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HC1047-22-D-0002 Defense Enclave Services

CUI

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Controlled By: DISA Controlled By: FE1 CUI Category: PROCURE Distribution/Dissemination Control: FEDCON POC: lily.j.scheve.civ@mail.mil

JUSTIFICATION FOR OTHER THAN FULL AND

OPEN COMPETITION (OTFAOC)

Federal Acquisition Regulation (FAR) Part 6 Justification & Approval (J&A), Supporting Procurements under FAR Part 12, and FAR Part 15

Contract Number: HC1047-22-D-0002 Procurement Title: Defense Enclave Services (DES) Estimated Value: $0.00 Statutory and Regulatory Authority: 10 U.S.C. 302(1a) and FAR 6.302-(1) / DFARS 206.302-1

Justification for OTFAOC Number: Not Applicable

Upon the basis of the following justification, I, as the Contracting Officer, hereby approve the use of other than full and open competition of the proposed contractual action pursuant to the authority of FAR 6.302-(1a) and FAR 6.302-(1)/DFARS 206.302-1).

REQUIRING AGENCY AND CONTRACTING ACTIVITY:

Requiring Agency:

Defense Information Systems Agency (DISA) Endpoint and Customer Services Directorate Fourth Estate Network Optimization (4ENO) Program Office 6910 Cooper Avenue Fort Meade, MD 20755

Contracting Activity:

DISA/Defense Information Technology Contracting Organization – National Capital Region (DITCO-NCR) / PL64 6910 Cooper Avenue Fort Meade, MD 20755

2. NATURE/DESCRIPTION OF ACTION(S): This J&A is in support of the modification of the DES, contract number HC1047-22-D-0002, a single-award indefinite delivery/indefinite quantity (ID/IQ), in order to provide support for a 4ENO requirement for Asset/Property Management and Logistics.

The DISA 4ENO Program Office has identified the DES ID/IQ as the most viable contracting solution to support the Asset/Property Management and Logistics requirements as identified in paragraph 3 below. Significant benefits are afforded to the Government by leveraging the expertise, cost efficiencies, and avoidance of unacceptable delays. The DES contract is

Page 2 of 7 Pages structured to provide IT support for common use environments, i.e., IT capabilities, applications, infrastructure, services, and business processes that are commonly threaded throughout all Department of Defense (DoD) organizations.

3. DESCRIPTION OF SUPPLIES/SERVICES: 4ENO has a need for Asset/Property Management and Logistics support. The objective of the Asset/Property Management and Logistics task order is to provide storage and storage support, along with shipping and logistics support for the migration of Defense Agencies and Field Activities (DAFAs) to the Department of Defense Network (DoDNet). Asset management and logistics are covered in the DES ID/IQ contract. However, there is need for a cost type contract line item number (CLIN) to support Other Direct Costs (ODCs) associated with this effort and a need to add specific labor categories for logistical support. The proposed ODC CLIN will support incidental costs associated with the performance of Asset/Property Management and Logistical support task orders, with the exception of equipment procurement which will continue under the applicable DoDNet Catalog(s) as stipulated in the Acquisition Plan for the DES contract. The addition of an ODC CLIN to the DES ID/IQ contract is required to ensure Procurement Data Standard compliance when task orders are issued under the ID/IQ contract. As presently constructed, and in accordance with the Acquisition Strategy and Acquisition Plan, the only ODC CLIN within the DES ID/IQ contract is for Travel.

In addition, the Government is proposing specific logistics labor categories to support the 4ENO requirement. Currently there are no labor categories established on the DES IDIQ that covers tasks required for the Asset/Property Management and Logistical support. The Government has identified three labor categories that are necessary to perform the requirement and that are not included in the DES IDIQ already established labor categories. The contemplated labor categories are Logistician (Intermediate), Logistician (Lead), and Shipping and Receiving.

Adding a cost type CLIN to support ODCs and adding logistics specific labor categories to the to the scope of the DES ID/IQ contract will not increase the ceiling value of the contract; the DES ID/IQ contract ceiling remains $11,504,145,490.57.

4. IDENTIFICATION OF STATUTORY AUTHORITY: Only one responsible source and no other supplies or services will satisfy agency requirements, 10 U.S.C. 3204(a)(1) (FAR 6.302-

1/DFARS 206.302-1).

5. DEMONSTRATION OF CONTRACTOR’S UNIQUE QUALIFICATIONS:

(a) Description of events. On December 21, 2017, the Reform Management Group (RMG) directed the IT and Business Systems Reform Group to review IT networks, policies, business processes, functions, costs, personnel, and IT organizational structures across the Fourth Estate. An assessment was performed by the DoD Chief Management Officer (CMO) and the Chief Information Officer (CIO), and a decision was made to consolidate Fourth Estate Common Use IT functions across the DAFAs listed in Attachment 1 under a Single Service Provider (SSP). DISA was granted the authority beginning on October 1, 2019, to direct the transition of each DAFA from legacy Common Use IT services and

Page 3 of 7 Pages assets into the SSP environment over the period FY20—FY24. DISA's authority includes the ability to give direction to DAFAs regarding all Common Use IT assets and services designated for transfer to DISA or to a DISA-approved contract.

DISA was directed to develop and provide a comprehensive Defense Working Capital Fund (DWCF) Common Use IT service, integrating commercially procured and inherently Government services to comprise an initial SSP environment ready for early adopters within 90 days. DISA was directed to engage with each affected DAFA to negotiate and establish Common Use IT functions spanning cyber security, enterprise services, asset management, network services, and operations. DISA will respond to DAFA's requests for new capabilities and involve DAFAs in architecture decisions and technology insertion and innovations to provided products and services.

During the transition to the SSP environment, DISA will unify the Government workforce and contracts for Common Use IT services and assets. In order to consolidate the Government workforce for efficiencies, the President's Budget 2020 Program Decision Memorandum has directed a transfer of Common Use IT workforce positions from each DAFA to DISA beginning in FY20. DISA's authority as the SSP for Common Use IT services includes the designation of additional IT workforce positions corresponding to legacy Common Use IT services and assets at each DAFA for transfer to DISA in future years. In order to consolidate contracts for economies of scale, DISA's authority includes the ability to direct DAFAs to review, and if deemed by DISA to be feasible and in the best interests of the Department, modify and de-scope incumbent legacy contracts, and utilize DISA's DWCF chartered services and designated contract vehicles for Common Use IT services and assets.

The single-award DES ID/IQ contract was competitively awarded to Leidos Corporation on 28 February 2022. DES is the result of the unprecedented effort to analyze and exploit the benefits of consolidating the DAFA networks and associated common use IT services into a department-wide strategic vision. Inconsistencies and duplicities across the Department’s Fourth Estate in cybersecurity management, reliability and resiliency, service level agreements, and asset management, all of which result in increasing IT operations costs, drove the requirement for a Single Service Provider. DES was solicited with the intent of bringing best of breed IT capabilities and services under a single umbrella, with special focus on service improvement, standardization, operational automation, and most importantly cost efficiencies. Leidos Corporation is uniquely positioned to support 4ENO’s Asset/Property Management and Logistics requirement as they are the only contractor that has performed assessment, integration, and operations and sustainment work on the common use IT DES environment. For this reason, Leidos Corporation possesses an unmatched level of experience and expertise in this field, allowing them to readily support 4ENO’s critical IT enhancements without the need for additional due diligence, transition, and/or knowledge transfer that would otherwise delay and hinder another contractor. While other contractors may be able to perform the work required, only Leidos Corporation, through the DES contract, is positioned to support the time critical needs of 4ENO today.

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Leidos Corporation is positioned to support the asset management requirement by leveraging shared resources across the Fourth Estate. By leveraging the DES contract, 4ENO will be able continually gain time and cost efficiencies through the life of the ID/IQ. Leidos Corporation is the only contractor capable of performing these requirements in an economically viable manner without introducing schedule delays that would impact the 4ENO mission by delaying the migration of DAFAs to DoDNet. Further, the requirements for asset management support the intended performance requirements of the DES contract. These are the efficiencies and cost savings for which the DoD CMO and CIO directed DISA to established as SSP solution. Awarding Asset/Property Management and Logistical support to another contractor would violate OCIO’s directive of December 21, 2017.

(b) Justification.

(1) Minimum Government requirements. 4ENO requires Asset/Property Management and

Logistics support. This support requires storage and storage support, along with shipping and logistics support. Asset management and logistics are covered in the DES ID/IQ contract however, there is need for a cost type CLIN to support ODCs associated with this effort and the addition of specific labor categories for logistical support.

(2) Proposed sole source contractor.

Leidos Corporation 1750 Presidents Street Reston, VA 20190

(3) Discussion regarding cause of the sole source situation. This requirement has not been previously acquired, however the timeliness of the DES acquisition and the urgency to meet the needs of asset management in order to ensure mission success necessitates a sole source situation to Leidos Corporation as the only viable contracting solution. No other contract exists with a viable scope to meet the unique needs of 4ENOs Asset/Property Management and Logistics support like the DES contract. There are no changes to the performance objectives in DES to meet the Asset/Property Management and Logistics requirement.

By utilizing the DES contract, asset management requirements will be aligned to the DoD’s Fourth Estate and Asset Management and Logistics Task Order in terms of quality of service while also achieving cost avoidance by having a single asset management provider. Additionally, by utilizing the existing contractor Leidos Corporation, the Government will avoid delaying DAFA migrations to DoDNet by utilizing an existing contract vehicle and avoiding delays due to solicitation.

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(4) Impact. Based on 4ENOs urgency for Asset/Property Management and Logistics support, a competitive acquisition is not a viable solution. Awarding Asset/Property Management and Logistical support to another contractor would violate OCIO’s directive for a SSP. Furthermore, the schedule to seamlessly migrate DAFAs to a SSP will be severely impacted if another competitive acquisition occurs rather than utilizing capable sources on the existing DES ID/IQ contract vehicle. A protracted schedule to award a competitive contract presents an unreasonable level of risk to 4ENO’s mission. Additionally, the estimated cost impacts of executing a competitive acquisition would further delay mission achievement and the benefit of this SSP efficiency would be lost if the requirement is awarded to another vendor.

6. CONTRACT OPPORTUNITIES ANNOUNCEMENT/POTENTIAL SOURCES: No previous announcement has been publicized for this modification action. In accordance with FAR 6.305, this J&A will be posted to the Government Point of Entry, SAM.gov, within 14 days of award.

7. DETERMINATION OF FAIR AND REASONABLE COST: Not applicable. This contract action will not impact the existing DES ID/IQ ceiling value, nor the established labor rate pricing, which was previously evaluated and determined to be fair and reasonable based on adequate price competition. The ODC CLINs issued in support of asset management requirements will be individually negotiated with the terms and conditions of the DES ID/IQ contract.

8. MARKET RESEARCH: Market research for this requirement was conducted in March 2023 and indicates there are no new sources that can execute the required services, as described in Section 6 of this document. Market research included the following activities: (1) review of previous market research and acquisition history for similar requirements; and (2) review of changes to industry application of commoditized IT services.

In summation of the current market research, no new sources are capable of supporting this requirement and only Leidos Corporation can fully meet the Government’s need within the required time frame. A competitive award for this requirement presents undue cost, schedule, and performance risk to DISA as prescribed in Section 5(b)(4) of this document and therefore not an economically feasible alternative.

In accordance with DFARS PGI 206.302-1(d), the DISA Head of the Contracting Activity approved a waiver to the requirement to post a sources sought announcement or request for information to SAM.gov prior to executing this J&A.

9. ANY OTHER SUPPORTING FACTS: None.

10. LISTING OF INTERESTED SOURCES: None.

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

THAT LED TO THE EXCEPTION TO FULL AND OPEN COMPETITION:

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(a) Procurement History. N/A

(b) The 4ENO Program Office is charged with managing the common use IT SSP environment, which oversees the asset management and logistics of the Fourth Estate IT through the services acquired by the DES contract. The Program Office has determined that the DES contract is the only current contract vehicle capable of meeting the asset management requirements while maximizing efficiencies and minimizing costs.