Attachment 3 -Redacted J and A.docx

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

10 U.S.C. 3204(a)(1) Solicitation 70Z03824RW0000002

Pursuant to the requirements of the Competition in Contracting Act (CICA) as implemented by the Federal Acquisition Regulation (FAR) Subpart 6.3, the following facts and rationale justify the use of such authority:

1. Agency and Contracting Activity.

The Department of Homeland Security, United States Coast Guard (USCG), Aviation Logistics Center (ALC), Medium Range Surveillance (MRS) Division, Elizabeth City, NC, prepared this justification for other than full and open competition.

2. Nature and/or Description of the Action being Approved.

(a) Nature of the action: The USCG, ALC, MRS Division requests approval to award, on a sole source basis, a Firm Fixed-Price contract for the procurement of the overhaul and repair services for the HC-27J and C130J propeller and propeller components, and Field Service Representatives (FSR) in support of the Programmed Depot Maintenance (PDM) of USCG aircraft.

(b) Name and address of the contractor:

GE Aviation Systems LLC (GE) 114 Powers CT #7 Sterling, VA, 20166-9321

(c) Type of action: Firm Fixed-Price, Indefinite Delivery Requirements Contract

(d) Estimated total value (including options):

Period Annual Total

Contract Totals $29,337,756

Services are currently provided under USCG contract 70Z03820DW0000001 with a period of performance end date of August 31, 2024.

(e) Type of funding: Operations and Support funds

(f) Year of funding: Fiscal Year 2024

(g) Solicitation number: 70Z03824RW0000002

(h) Background information about the requirement: This requirement is a follow-on requirement for Dowty Propellers (Dowty) R391 propeller repair and overhaul services provided under USCG contract 70Z03820DW00000001 that expires in August 2024. These services provide operational capability and continuity for the USCG HC-27 and HC-130 aircraft.

3. Description of Supplies/Services.

The action being approved is for services to repair and overhaul the Dowty R391 Propeller and components, for services of a Field Service Representative with technical reach back to engineers, and access to current real time OEM manuals, publications, and service bulletins required to support operational aircraft and PDM aircraft maintenance of the R391 propeller assemblies. This requirement will be awarded as a contract in accordance with FAR Part 12, Acquisition of Commercial Items and FAR Part 15, Negotiations. Services will be provided through individually funded task orders.

4. Identification of Statutory Authority Permitting Other Than Full and Open Competition.

The statutory authority permitting other than full and open competition is 10 U.S.C. § 3204(a) implemented by the FAR Subpart 6.302-1 entitled “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.”

5. Identification of Exception to the Buy American Act.

Not Applicable.

6. Demonstration that the Proposed Contractor’s Unique Qualifications or the Nature of the Acquisition Require Use of the Authority Cited.

(a) Rationale for using the authority cited in section 4 of the J&A: Dowty is the OEM of the R391 propeller assembly and GE controls engineering design change and product improvement. The data rights relative to the R391 propeller and components are proprietary to Dowty. GE is the only OEM authorized repair/overhaul facility authorized for the components identified in this requirement. The R391 propeller system was vetted as part of the aircraft’s operational requirements for the HC-130J and the HC-27J aircraft by the aircraft OEMs. The R391 propeller system were provided to the USCG as part of each of the aircraft platforms. Replacement of the R391 propellers on the HC-130 and HC27J aircraft would require significant resources by each of the aircraft OEMs as well as the USCG and is not an option for USCG consideration independent of the aircraft OEM. The USCG does not have adequate technical data to provide to potential offerors to promote competition.

(b) Details covering what events lead to the situation requiring use of other than full and open competition procedures including whether any portion of the work can be segregated to allow for competition.

The R391propeller assembly and components specified for overhaul by this requirement are considered Critical Safety Items (CSIs). A CSI is a part, assembly, installation, or production system with one or more critical characteristics that, if not conforming to the design data or quality requirements, would result in an unsafe condition. Unsafe conditions relate to mishap severity categories I (Catastrophic), and II (Critical) of Military Standard MIL-STD 882 and MIL-STD-100, System Safety Program Requirements, and include conditions which could cause loss or serious damage to the end item or major component, loss of control or serious injury to the personnel. USCG Engineering has determined that in order to ensure safety of flight, overhaul repair services must be accomplished by the OEM. The technical data for the repair and overhaul services identified in this requirement have not been released or sold to any Government agency. The OEM of the aircraft propellers Dowty, allows GE access to license, manuals and data and solely authorizes GE to perform overhauls and major repairs. Both companies fall under the GE Aerospace LLC umbrella.

(c) Summarize alternatives considered and why they will not work.

The USCG is prohibited from disclosing any technical documents in their possession as these were developed at private expense by GE and are proprietary to Dowty, the OEM for the R391 Propeller Assembly. GE is the only source in possession of the proprietary data, engineering design change, and product improvement capability. No alternative sources were considered as the data rights are proprietary to the OEM or any OEM authorized repair/overhaul facilities. The USCG is not able to reverse engineer any of the identified components nor share any repair/overhaul documents to find additional sources and facilitate competition for this requirement.

(d) Impact to the mission that would result if the J&A is not approved and, consequently, the product or service not provided. Spare R391 propellers, technical data and engineering resources supplied by the propeller OEM, and access to up-to-date manuals and publications are required to ensure availability of operational aircraft in support USCG missions. Failure to approve this J&A will jeopardize the performance of the USCG’s mission due to grounding of the aircraft as a result of insufficiency airworthy, ready for issue stock being available of the components as required.

(e) Section is required to be completed when the J&A includes the exception listed under FAR 25.103(b)(2) or FAR 25.202(a)(2)).

The exemption at FAR 25.103(b)(2) is not taken.

7. Description of Efforts Made to Ensure that Offers are Solicited from as Many Potential Sources as is Practicable.

(a) Sources Sought Notice70Z03824IL0000002 was posted on SAM.gov on January 4, 2024.The USCG received two timely responses to the Sources Sought Notice. This acquisition is forecasted in the Department of Homeland Security (DHS) Acquisition Planning Forecast System (APFS), number: F2023064354 published on October 5, 2023, revised on February 13, 2024, and can be found at https://www.apfs.gov

(b) If an announcement is being planned for posting in Contract Opportunities, provide the estimated date of publication. The Justification for Other than Full and Open Competition (J&A) will be posted to the Government-wide Point of Entry (GPE), via https://www.sam.gov, with the Notice of Intent that USCG intend to award to GE on a sole source basis. Any capability statement, or quotation received will be considered prior to award and the Contracting Officer will make a determination to solicit the requirement based on limited competition, if appropriate.

(c) If an announcement will not be published, identify the applicable exception under FAR 5.202.

The exceptions under FAR 5.202 do not apply to this requirement.

8. Determination by the Contracting Officer that the Anticipated Cost to the Government will be Fair and Reasonable. The contracting officer anticipates that prices will be determined fair and reasonable based on prior procurement history. The Contracting Officer will evaluate all proposals in accordance with FAR 15.404-1(b)(2).

9. Description of Market Research.

(a) Describe the market research techniques used, results, date when the market research was conducted, and how it was used by the contracting officer to determine price reasonableness. Market Research indicates that the components are not listed on a General Services Administration (GSA) contract or available through GSA Advantage. Market research also consisted of querying the Acquisition history, Internet Search, Inventory Locator System (ILS), Catalog and product literature, DHS-Wide and Multi-Component Contract Vehicles, Excess from Other Agencies, AbilityOne, Contracting Opportunities, and the Acquisition Planning Forecast System revealed no alternate supply sources. The OEM’s authorized facility, GE Aviation LLC, is the only approved source to provide the required repair and overhaul services. These repair and overhaul services for the HC-27J and HC-130 are commercial in nature and are prevalent in private aviation and commercial aviation. All terms and conditions are not expected to differ from customary terms and conditions in the marketplace or standard Government practices.

A Sources Sought Notice 70Z03824IL0000002 was posted on January 4, 2024, to Sam.gov. The USCG received two timely responses from GE and Piedmont Propulsion Systems, LLC (Piedmont). Piedmont provided a response stating “PPS is a FAA-certified Part 145 Repair Station with Propeller Class 1 and 2 Ratings for all Dowty propellers. FAA has specifically audited and approved PPS’s capability to support the Dowty R391 propeller assembly used on the HC-27J and HC-130J.” Piedmont’s response also includes “However, PPS does not possess an ‘OEM license to ensure access to the most current OEM overhaul data and OEM replacement parts.’ and ‘…USCG can provide PPS with access to the latest R391 maintenance manuals.” The USCG has confirmed with Dowty Propellers that the access granted to the USCG is for only Operational level repair manuals (minor operational repairs) and does not include access to any other repair/overhaul manuals nor the authority to distribute the manuals to anyone without Dowty Propellers approval. The requirement in question is for repairs outside of the operational level along with overhauls and FSR services. This information is considered proprietary to Dowty Propeller and their authorized repair facility and is not available for the USCG to distribute. Therefore, the USCG has determined that Piedmont is unable to provide documentation that they have access to the OEM licenses and manuals required to provide these services and will not be considered as a potential source for this requirement. The OEM was asked if these manuals were provided to any sources and the response received was that, that information and data was proprietary and not distributed.

(b) Describe the market research results that support the determination that the items are not available.

This J&A requirement does not include the exceptions at FAR 25.103(b)(2) or FAR 25.002(a)(2) for the Buy American Act.

(c) If market research was not conducted, state why.

Market research has been conducted.

(d) If patents, copyrights, and/or intellectual property are applicable to the acquisition, describe the circumstances for acquiring a patented or copyrighted product on the representation of the intellectual property holder that has not been licensed for resale.

This requirement does not have nor requires patents, copyrights, and/or intellectual property.

10. Any Other Facts Supporting the Use of Other Than Full and Open Competition.

(a) An explanation why technical data packages, specifications, statement of work, or purchase descriptions are not suitable for full and open competition.

GE, is the only approved source to provide the identified services. Therefore, this requirement is not suitable for full and open competition. The technical data package, including drawings, specifications, manuals, and publications required to develop additional sources to provide the repair and overhaul services were not procured by the Government and are proprietary to the OEM.

All manuals and publications published by the OEM, Dowty, are proprietary with restricted data rights afforded to the Government. Dowty has marked and continues to mark all maintenance support documents provided to the Government with restrictive verbiage regarding its release to any other party without expressed written permission from. To date, Dowty has not provided permission for that release.

(b) Discuss why your requirement cannot be modified to enhance competition.

The services to be procured cannot be modified to enhance competition because the components and the subsequent technical data are not available from any distributor other than the OEM.

(c) For a proposed contract subject to the restrictions of FAR 6.302-1 for follow-on acquisitions as described in 6.302-1(a)(2)(iii), provide an estimate of the cost to the Government that would be duplicated and detailed information on how the estimate was derived.

This requirement is not a follow-on for the continued provision of highly specialized services pursuant to FAR 6.302-1(a)(2)(ii).

(d) For a proposed contract subject to the restrictions of FAR 6.302-2(d) or HSAR 3006.302-270 and where FAR 6.302-2 is cited as the authority, describe the exceptional circumstances allowing for an award for a period of performance in excess of the one-year limitation (applicable to all federal agencies) or the DHS-specific statutory 150-day limitation.

Not applicable to FAR 6.302-2(d) or HSAR 3006.3020270. This is not considered unusual and compelling urgency.

11. A Listing of the Sources, if Any, that Expressed, in Writing, an Interest in the Acquisition.

As previously mentioned, both GE and Piedmont responded to the Sources Sought notice posted. However, only GE is considered an approved repair/overhaul source by both USCG Engineering and the OEM. No other sources have expressed an interest in this requirement.

12. A Statement of the Actions, if Any, the Agency May Take to Remove or Overcome Any Barriers to Competition Before Any Subsequent Acquisition for Supplies or Services Required.

a. Will the Government revise overly technical specifications, acquire data rights, etc?

The manufacturing, performance, and acceptance data are proprietary to the aircraft OEM. The USCG does not possess adequate and appropriate technical data to provide to potential offerors.

Dowty has not expressed any interest nor a desire to sell the proprietary data rights for the propellers and propeller components identified in this requirement. There are no actions the USCG can take to remove or overcome barriers to competition for this requirement. In the event Dowty chooses to release proprietary data rights, the acquisition of the identified services will be pursued on a full and open basis.

The USCG will continue to research maintenance and repair web-based subscription services, alternate approved systems, and industry periodicals, and sends representatives to various aviation trade shows and conferences to seek out all possible legally achieved purchase/service options and source.

b. When a J&A is issued for the purposes of acquiring goods or services while a competitive procurement is being conducted, the justification should include a detailed timeline for completion of the competitive procurement. The period of performance for the sole source action should fairly balance the time needed to complete the competitive procurement. The focus should be on minimizing the need for additional sole source awards. N/A