A9_FBO_MCK_JOFOC_Water.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN

COMPETITION

PUBLIC UTILITY - WATER UTILITY SERVICE

FEDERAL CORRECTIONAL INSTITUTION MCKEAN

LEWIS RUN, PENNSYLVANIA

Contractor: Bradford City Water Authority

Period of Coverage: 2/1/2016 through 9/30/2016

Estimated Amount: $190,670.00

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

FCI McKean Water Utility Service

(a) Pursuant to the Federal Acquisition Regulation (FAR) Part 6.302-l(b)(3), and the Bureau of Prisons Acquisition Policy (BP AP) Acquisition Guidance Document (AGD) 06-006, the Federal Bureau of Prisons (FBOP) has determined that the procurement of Water utility service for the Federal Correctional Institution (FCI) McKean located near Lewis Run, Pennsylvania, meets the criteria established for other than full and open competition. It is further determined that only one responsible source and no other supplies and/or services will satisfy agency requirements. This limitation on competition is justified as supported by the following information in accordance with FAR Part 6.303-2:

(b)(l) IDENTIFICATION OF THE AGENCY AND THE CONTRACTING ACTIVITY:

U.S . Department of Justice Federal Bureau of Prisons FCIMcKean 6975 Route 59 Lewis Run, PA 16738

(b)(2) NATURE AND/OR DESCRIPTION OF ACTION BEING APPROVED:

This justification for other than full and open competition is for the acquisition of water utility services supplied to FCI McKean, from the original and sole provider of such services. FCI McKean has a present and continuing requirement for water utility service for the proper operation of the facility.

(b)(3) DESCRIPTION OF SUPPLIES OR SERVICES REQUIRED TO MEET THE AGENCY

NEEDS:

Pursuant to FAR Part 41 .202, the Bradford City Water Authority (BCW A) continues to provide the "entire water utility service" (i.e., transportation, distribution, system operation and maintenance, treatment, metering, billing, etc.). The BCWA shall provide to the government facility at FCI McKean, water services in a manner and form that is consistent with all applicable laws, rules, codes, industry standards, permits, and regulations, promulgated by any and all governmental authorities havingjurisdiction. The BCWA shall provide services on an un-interruptible daily basis (365) days per year. The BCW A will be responsible to maintain and/or repair all associated pipelines and equipment, including associated costs for such repair, up to the distribution point or meter of FCI McKean. The BCW A will be responsible to ensure that the pipelines and associated equipment utilized to provide water services will be maintained and operated in compliance with all rules and regulations set in accordance with all Federal, State, County, and local government for a safe and sanitary water utility service.

The BCW A shall provide water utility services for the period from February 1, 2016, through September 30, 2016, subject to funds availability (FAR Clause 52.232-18). The average monthly amount for water utility service is estimated to be $23,833.75 . The total estimated amount for water utility service is $190,670.00. ·

Source Selection Information- See FAR 2.101 & 3.104

FCI McKean JOFOC Page2

Water Utility Services

(b)(4) AN IDENTIFICATION OF THE STATUTORY AUTHORITY PERMITTING OTHER THAN

FULL AND OPEN COMPETITION:

This justification to award as a sole source is prepared pursuant to the exception to full and open competition requirements in accordance with the statutory authority for these services that is found at 41 USC § 253 (c)(l), the supplies or services required by the agency are available from only one responsible source. The application which permits use of the cited statutory authority are stated at FAR Part 6.302-l(b)(3), "When acquiring utility services (see 41.101), circumstances may dictate that only one supplier can furnish the service (see 41.202). Analysis of the market indicates that the BCWA has proprietary rights up to the distribution point or meter at FCI McKean. In order for another provider to be capable of providing the service, significant capital improvements would be needed. The Bureau would be required to pay for the capital improvements, but it would not recover the costs of duplication of services, connection fees and infrastructure installation costs through competition. The current requirement is for follow-on services and does not include funding for capital improvements. In accordance with FAR 9.102(b), a contracting officer is not required make a responsibility determination when awarding to a Foreign, State, or local government.

(b)(5) A DEMONSTRATION THAT THE PROPOSED CONTRACTOR'S UNIQUE

QUALIFICATIONS OR THE NATURE OF THE ACQUISITION REQUIRES USE OF THE

AUTHORITY CITED:

The BCWA is the government-owned sole provider of water utility service in this McKean County service area. The BCW A does not appear to be regulated by the Public Utility Commission of Pennsylvania which is the governing body that sets all rates and tariffs for water companies. BCW A is a local Government entity and the only agent authorized by rules and regulations to provide these services within the service area. Having a single supplier of water for this area is the most efficient method of providing these services. This requirement cannot be conveniently or economically obtained by contracting directly with a private source because building multiple distribution and treatment systems would be costly and inefficient.

(b)(6) A DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE SOLICITED

FROM AS MANY POTENTIAL SOURCES AS IS PRACTICABLE INCLUDING WHETHER OR

NOT A NOTICE WAS OR WILL BE PUBLICIZED AS REQUIRED BY FAR SUBPART 5.2:

As stated in FAR Part 5.202, exceptions to transmitting a notice to the Government Point of Entry(GPE) at (a)(5), the contracting officer need not submit a notice when 'the proposed contract action is for utility services other than telecommunications services and only one source is available.' A General Services Administration (GSA) area- wide nor a single point contract for water utility services in the FCI McKean area is available at this time.

(b)(7) A DETERMINATION BY THE CONTRACTING OFFICER THAT THE ANITCIPATED

COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE:

The current rates offered by the BCW A are equal to the market price levied other commercial and

Water Utility Services industrial users in the FCI McKean area. The BCW A has provided sufficient data to the FBOP contracting officer, pursuant to FAR 15.402, Pricing Policy, allowing the ability to make a preliminary determination that such anticipated costs appear to be fair and reasonable. The BCW A is a non-profit local Government entity. Utility rates are enacted during meetings of the BCW A, which is charged under Pennsylvania law to ensure that rates be just and reasonable. A formal decision in the form of periodic rulings, reviews, or similar actions of a governmental body, or embodied in the laws, are sufficient to set pricing (see FAR 15.403-1 [c][2]) and the purchasing of supplies and services from a responsible source is determined fair and reasonable. As such, this contracting officer has determined the anticipated cost to the Government will be fair and reasonable.

(b)(8) A DESCRIPTION OF THE MARKET RESEARCH CONDUCTED:

This documentation is in accordance with FAR Part 10, which describes the policies and procedures for conducting market research in a process of finding viable sources of goods and services to meet government requirements and to find the most suitable approach to acquiring, distributing, and supporting supplies and services. This report is submitted in support of an acquisition with an estimated value in excess of the simplified acquisition threshold. Below are the findings of the market research for the above referenced requirement.

Background: A review of the obligation reveals the following-The Federal Correctional Institution McKean (hereinafter referred to as ''FCI McKean") has a current and continuing requirement for water utility service.

Title: Water Utility Service FCI McKean, to provide water services forthe FBOP, FCI McKean near Lewis Run, PA. FCI McKean does not have onsite water treatment/distribution facilities.

Product Service Code: S- Utilities and Housekeeping Services - S 114 Utilities/Water.

North American Industry Classification System (NAICS): 211310 Water Supply and Irrigation Systems.

Standard Industrial Classification (SIC) Code: 4941 Water Supply.

Estimated Contract Value (including options): $190,670.0b for 8 months

Potential Sources: The BCW A is the sole provider of water utility service in the FCI McKean service area. FAR provides that a formal decision in the form of periodic rulings, reviews, or similar actions of a governmental body, or embodied in the laws, are to set pricing and the purchasing of supplies and services are determined fair and reasonable from a responsible source. I applied personal knowledge, interaction with knowledgeable individuals in local and Federal regarding market capabilities to meet the requirements, and research of generally accessible literature available on-line were the techniques used in researching this procurement for a supply/services of this type. During construction of the institution, one contract was awarded for the installation and operation of one water pipeline leading

Source Selection Information - See FAR 2.101 & 3 .104

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Water Utility Services to the institution. A review of State of Pennsylvania regulations determined that this water utility service is not a deregulated utility. Deregulation would promote competition.

Commercial Item Determination: Water utility service is an item that is of a type customarily used by the general public and by non-governmental entities for purposes other than governmental purposes.

Market Analysis:

The results of market research have determined that the government's needs can be met by items customarily available in the commercial marketplace.

The market research conducted by the contracting office and the Facilities Department personnel determined that a GSA area-wide nor a single point contract is available in accordance with Title 31 USC § 1535. No Interagency Agreement is available for use either. GSA is specifically authorized by law and regulation to purchase utility services on behalf of other agencies by providing an Assisted Acquisition. In August 2010, in accordance with 40 USC 121 § (d), GSA issued the FBOP a Delegation of Authority for nationwide authority to negotiate and execute utility service contracts at Federal facilities under the control and direction of the FBOP in accordance with 40 USC 501 § (b )(l)(B)for a 10 year period. The FBOP, as the requiring agency, must make a determination of the best procurement approach that satisfies FCI McKean's schedule, performance, and delivery requirements. The BCW A is the current water utility service provider for FIC McKean and has serviced the facility since 1989. No other source could be expected to make the capital investments for the infrastructure required to provide water utility service to meet FCI McKean's requirements.

Results: Based on the information provided by the sources detailed above, the following information outlines the conclusions and provides the basis for this procurement.

It is this Contracting Officers determination there is a source available that is capable of providing the required services. The procurement will be conducted in accordance with the procedures as outlined in FAR Part 12, 13, and 41. A Performance-Based Acquisition method will not be used for this procurement as it is determined not applicable. A PBA relies on the use of measurable performance standards and financial incentives in a competitive environment to encourage competitors to develop and institute innovative and cost-effective methods of performing the work.

One potential source is a local entity, the incumbent BCW A, which appears able to satisfy the requirement. BCW A is other than small business.

The provision of water utility service is essential for the orderly operation of FCI McKean. History shows and economics dictate that the construction of facilities by multiple utilities in the same location would be extremely costly and disruptive to communities. The ratemaking process ensures the lowest reasonable rate for consumers while maintaining the financial stability of the utility. Under the law, the utility is entitled to recovery of its reasonable incurred expenses.

Water Utility Services

The Bureau does not have the state and local approval or the resources to provide the funding for another company to install a treatment plant/distribution system at the institution, another pipeline is not available, and no other contractor can provide water utility service through BCW A pipelines.

Recommendation: The Government contemplates the single award of a firm-fixed price requirements type water utility service purchase order.

Comments: The conclusions from this market research will be incorporated into the agreement document for providing Water Utility Service for FCI McKean.

(b)(9) ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN

COMPETITION:

The provision of water utility services is essential forthe orderly operation ofFCI McKean, which was designed with arated capacity to collectively house approximately 1148 inmates. The facility is an all-male medium security correctional facility with an adjacent minimum secUiity federal prison camp.

State regulations and local ordinances limit the providers of this service to only one.

(b)(lO) A LISTING OF THE SOURCES, IF ANY, THAT EXPRESSED, IN WRITING, AN

INTEREST IN THE ACQUISITION:

There were no other sources which expressed an interest in this acquisition.

(b)(ll) A STATEMENT OF THE ACTIONS, IF ANY, THE AGENCY MAY TAKE TO REMOVE

OR OVERCOME ANY BARRIERS TO COMPETITION BEFORE ANY SUBSEQUENT

ACQUISITION FOR THE SUPPLIES OR SERVICES REQUIRED:

Contracting and requirement staff continue to conduct appropriate market research to determine if sources capable of satisfying the agency's requirement exist and to overcome competition barriers.

Deregulation laws are presently nonexistent and no alternative source of service is currently available. A review ofFPDS-NG shows only the FBOP is currently issuing purchase orders to the BCW A for water utility service. If another potential source emerges, the agency will assess whether competition for future requirements is feasible.

(b)(12) CONTRACTING OFFICER'S CERTIFICATION:

I hereby certify that this request for Justification and Approval of other than Full and Open Competition is made in good faith, that the supporting data and information are accurate and complete to the best of my knowledge and belief, and that I would not be making this request if it were feasible to fully compete this requirement. I further certify that this request is not the result of lack of advance planning or a desire

Water Utility Services

Source Selection Information – See FAR 2.101 & 3.104 to expend funds while those funds are still available.

_//Signed//___________________________ _2/17/2016

Dennis Dempsey, Contract Specialist Date

Field Acquisition Office

(c) I hereby certify that the supporting data, provided by the technical and requirements personnel, which form the basis for this justification is complete and accurate to the best of my knowledge and belief.

Isaac Hilton, Facilities Manager Date

FCI McKean

Concurrence:

M. Recktenwald, Warden Date

FCI McKean

Approved:

_//Signed//___________________________ _2/23/2016

Jill D. Ryan, Chief Date

Field Acquisition Office