Attachment_5_Pricing_Instructions.pdf

CUI

JPSS USG Pricing Instructions

SUBJECT: United States Government (USG) Request for Proposal Pricing Instructions in Support of the Joint

Propellor Sustainment Support (JPSS) effort

The offeror (General Electric Aviation Systems) shall comply with these pricing instructions to prepare its priced proposal for the Joint Propellor Sustainment Support (JPSS) effort.

The USG assumption is that all pricing from General Electric Aviation Systems (herein also referred to as “Dowty” or “the contractor”) or any subcontractor supporting JPSS will be subject to certification pursuant to the Truthful Cost or Pricing statute (e.g. TINA – 41 USC Chapter 35 or FAR 15.403-4) unless one of the following is applicable:

1. The contractor makes a commercial item assertion to include a description of the supplies or services, the specific identification of the type of commercial item claim (FAR 2.101 commercial product sub-definitions (1) through (6) or commercial service sub-definitions (1)-(3)), the basis on which the item meets the definition, the supplier part number, and the commercial equivalent part number.

For modified commercial items (commercial item sub-definition (3)), the offeror shall specify the classification of the modification(s) with supporting rationale as either:

a. Of a type customarily available in the commercial marketplace (FAR

2.101 commercial item sub-definition (3)(i)); or

b. A minor modification of a type not customarily available in the commercial marketplace made to meet Federal Government requirements (FAR

2.101 commercial item sub-definition (3)(ii)).

2. Complete population of sales data for all part numbers as detailed at Section (c) and Section (d) of these instructions.

(a) General Instructions and Guidance In response to the Request for Proposal (RFP), the contractor shall prepare and submit financial or cost records and supporting attachments to substantiate its cost proposal:

(1) Responsibility.

The responsibility for providing a well-prepared and fully supported cost proposal lies solely with the contractor. The basis and rationale for all proposed costs shall be provided as part of the proposal so that the Procuring Contracting Officer (PCO) has the information necessary to evaluate the reasonableness of the proposed price.

(2) Intent.

These pricing instructions are issued to facilitate timely delivery of an adequate proposal for review, evaluation, negotiation, and award. Nothing herein shall limit the contractor from choosing to provide additional information. Nothing herein shall be construed to prohibit the PCO at any time from requesting additional information to the extent necessary to determine fairness and reasonableness of proposed costs.

(3) Proposal Adequacy Checklist

Except as otherwise provided, the contractor shall prepare and submit certified cost or pricing data and supporting attachments in accordance with Table 15-2 of FAR

15.408 as well as other existing regulations. The contractor shall utilize the DFARS 252.215-7009, Proposal Adequacy Checklist (PAC) (MAR 2023), including in pre-submission proposal quality reviews, and furnish the completed checklist as part of its final proposal submission.

i. If the contractor is unsure as to whether a checklist item is required in support of the effort, or how to adequately comply with a checklist item, the contractor shall contact the PCO as soon as possible, but in any case, prior to the final proposal submittal, to resolve the questions.

ii. Any significant deviations from the DFARS Proposal Adequacy Checklist (not otherwise authorized by the PCO) and the additional requirements herein will require immediate correction by the contractor; however, completion of the checklist does not relieve the contractor from the responsibility to comply with all applicable regulations and any special requirements of the solicitation.

iii. These instructions and those in the Request for Proposal shall take precedence over the Proposal Adequacy Checklist.

(4) In addition to the requirements identified in the DFARS Proposal Adequacy Checklist, the contractor shall submit the following in its proposal:

a. Breakout by Year.

If the proposal includes more than one (1) Contract Line Item Number (CLIN)/subCLIN, the proposal shall include a breakout of all CLIN/subCLIN prices by cost element by Contractor Fiscal Year (CFY) and by contract period.

i. The proposal shall define the timeframe of the Contractor Fiscal Year (for example, January – December).

At the PCO’s direction, the breakout by year shall also be provided by Calendar Year

(CY)

b. Recurring/Non-recurring costs.

If the proposal includes more than one (1) CLIN/subCLIN, the contractor shall identify the recurring/non-recurring costs for each CLIN/subCLIN.

c. Cost Estimating Relationships.

All costs proposed on the basis of Cost Estimating Relationships (CERs) shall be fully supported. The proposal shall identify the basis for the proposed rate, the base to which the rate is applied, and clearly demonstrate the calculation of proposed costs based on CERs.

(5) Submission of electronic cost model.

Cost models shall be submitted in Excel workbook format only as detailed below.

The Excel file shall be an unlocked electronic cost model with visible formulas demonstrating the mathematical calculation of the proposed cost (in Excel). Th Excel file shall include worksheets for direct rates, indirect rates, direct cost inputs, etc.

All information supporting each CLIN shall be visible and verifiable in the electronic cost model. The formulas included in the electronic cost model shall not be locked, and the model shall be editable by the USG.

The contractor shall require separate electronic costs models containing the same information specified above from its subcontractors/interdivisionals (IWTs) for which FAR compliant proposals are required.

Other submissions. In addition to proposal submittal through electronic means to the PCO, the offeror shall submit one (1) additional electronic copy to the Navy Price Fighters (NPF).

(6) Proposal updates.

The contractor shall take actions to minimize formal proposal updates/refreshes/revisions.

The contractor shall coordinate with the PCO as early as possible throughout the proposal process if a proposal update/refresh/revision is needed. In no event shall the contractor submit a proposal update/refresh/revision without prior coordination with the PCO.

The PCO will consider the nature and extent of any proposal inadequacies, or unqualified proposal submittals, when assessing/negotiating proposal preparation costs. Revisions/refreshes/revision to the proposal resulting from any of the following will be challenged in their entirety by the USG:

i. Errors in data utilized by the contractor to estimate costs discovered by the

USG during fact-finding that impact the total cost line by more than $500k

ii. Data required by pricing instructions that was not provided in the initial proposal submission

(7) Other Direct Cost BOEs.

The contractor shall provide the basis of estimates and rationale for all Other Direct Cost (ODCs), to include any travel worksheets and Field Service Representative (FSR)/Contractor Field Team (CFT) price build-ups, in an Excel format.

(8) Submission of Historical Actual Costs Incurred.

It should be noted in accordance with FAR 31.201-3, a cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person in the conduct of competitive business. Reasonableness of specific costs must be examined with particular care in connection with firms or their separate divisions that may not be subject to effective competitive restraints. No presumption of reasonableness shall be attached to the incurrence of costs by a contractor. If an initial review of the facts results in a challenge of a specific cost by the contracting officer or the contracting officer’s representative, the burden of proof shall be upon the contractor to establish that such cost is reasonable.

(b) Commerciality Assertions:

For all products or services the contractor asserts to be not subject to the submission of certified cost/pricing data due to commerciality, the contractor shall provide the following documentation, at a minimum:

1. A description of the supplies or services;

2. Specific identification of the type of commercial item claim (FAR 2.101 commercial item sub-definitions (1) through (6)), and the basis on which the item meets the definition; and

3. For modified commercial items (commercial item sub-definition (3)), classification of the modification(s) with supporting rationale as either:

i. Of a type customarily available in the commercial marketplace (FAR

2.101 commercial item sub-definition (3)(i)); or

ii. A minor modification of a type not customarily available in the commercial marketplace made to meet Federal Government requirements (FAR 2.101 commercial item sub-definition (3)(ii)).

4. Mapping/matrix of supplier part number, commercial equivalent part number and part number priced as part of the scope of JPSS

5. The contractor shall identify/track all commercial warranties extended to the

USG.

6. All commercial assertion supporting documentation shall be presented un-redacted unless coordinated in advance with the PCO.

After receipt of the contractor and supplier proposals (as applicable) and/or after receipt of the requested data, the USG may require certified cost/pricing data (CC&PD), including actual cost data, in the event the USG determines a product or service does not meet the commercial definition and no other exception applies.

Items sold to state, local, or foreign governments or items sold with applications only to state, local, or foreign government or US Government end items are not considered to be sales to the general public unless the proposed commercial item meets the FAR 2.101 commercial item definition sub-definition (8).

(c) Basis of pricing for new assets (inclusive of spares, spare components and production):

The following instructions are applicable to the scope inclusive of Spare Component and Material Procurement

For pricing based on an assertion of commerciality IAW FAR 2.101:

The USG will establish price reasonableness using the guidance at FAR 15.403-1(c)(3)(i)- (iv), FAR 15.403-3, FAR 15.404-1(b)(ii), (vi) and (vii) and DFARS PGI 215.404-3.

In accordance with the following regulations, the PCO may require the offeror to provide additional cost/pricing data in order to determine price reasonableness:

1. In accordance with FAR 15.403-3, the PCO may require the submission of data other than certified cost or pricing data from the offeror to the extent necessary to determine a fair and reasonable price.

2. DFARS PGI 215.402(2) states that when certified cost or pricing data are not required, and the contracting officer does not have sufficient data to determine price reasonableness, FAR 15.402(a)(2) requires the offeror to provide whatever data the contracting officer needs to determine fair and reasonable prices.

3. In accordance with DFARS PGI 215.404-1(a)(i)(C), if previous sales data is not sufficient to determine price reasonableness, the contracting officer must obtain “data other than certified cost or pricing data.”

4. If the product/service procured by the USG for JPSS is a modification of a commercial items/service, the pricing of the modification would be exempt from the requirement for submission of certified cost or pricing data provided the total price of all such modifications under a particular contract action does not exceed the greater of the threshold for obtaining certified cost or pricing data in FAR 15.403-4 (e.g. $2.5M if awarded before 30 June 2026 and $10M if awarded after 30 June 2026) or 5 percent of the total price of the contract at the time of contract award. If the value of the modification exceeds the applicable TINA threshold 5 percent of the anticipated contract value, the contractor will be required to certify to the pricing delta between the commercial item/service and the modification.

Per DFARS 215.404-1(b)(ii), the contractor nor the USG shall rely solely on prior Government prices paid, including purchase orders, to support the reasonableness of the commercial item price; additional other than certified cost and pricing data information may be necessary.

The contractor shall provide all unredacted sales data (entire population inclusive of USG, foreign governments and non-governmental end users/commercial customers) from May 2018 to the USG’s RFP release date for 100% of the part numbers with a unit price greater than or equal to $250 contained within the R391 catalog and R381 catalog. Sales data shall include the following, at a minimum per FAR 15.403-3(c):

1. Customer name

2. Sale date

3. Item part number

4. Unit price per part number

5. Part number nomenclatures

6. Quantities per part number

7. Applicable terms and conditions (FAR 15.403-1(c)(3)(ii)(B))

The contractor shall provide the sales data in Excel format.

Sales data shall be inclusive of all sales per part number within the specified time period, regardless of customer and quantity.

Sales data shall be inclusive of all sales per part number within the specified time period, regardless of whether the activity was performed when the contractor was a prime or when Dowty was a subcontractor.

The contractor shall annotate if the part number sold to the USG differs than the commercial equivalent part number.

The contractor shall provide a matrix of all USG C-130J part numbers and nomenclatures and the corresponding commercial equivalent part numbers and nomenclatures.

If the contractor refuses to provide or the USG is unable to determine a fair and reasonable price based on a review of the sales data the PCO will request the contractor provide other than certified cost or pricing data in the form of cost data to support the proposed prices for the JPSS effort IAW FAR 15.403-1(c)(3)(ii)(C). The cost data that will be requested by the USG will include at a minimum:

1. A costed Bill of Material (BOM)

2. Actual labor hours and labor cost

3. Direct labor and indirect rates

4. The cost buildup for the proposed parts to support the proposed prices

For pricing subject to Truthful Cost or Pricing Data (FAR 15.403-4):

In addition to the requirements outlined in FAR 15.408 and Table 15-2, the contractor shall provide actual incurred hours and costs per part number from May 2018 to the USG’s RFP release date for any scope not asserted by the contractor to be and concurred with by the USG PCO to be commercial.

Provided actuals shall include the following, at a minimum:

1. Incurred actual hours by labor category, calendar year and part number

2. Incurred material costs by calendar and part number

3. Actual direct labor/indirect rates or a loaded rate required to calculate an extended price

Actuals may be provided in total per part number and year or at the per unit level.

1. If the actuals provided are in total per part number and year, the number of completed units per part number and year shall be provided in order for the USG to derive an average hours/costs per unit.

2. If the actuals are provided at a unit level, all incurred actuals per part number and year shall be provided (e.g. if 100 repairs for part number X were performed in CY2025, actuals for all 100 repairs need to be provided and the actuals need to be segregable)

(d) Basis of pricing for repairs (inclusive of over & above repairs, overhauls and regrease):

The following instructions are applicable to the scope inclusive of:

• Consumable Material Replenishment

• Repairable Component Replenishment

• TPTG Upgrade (Prop Assembly & Individual Blades)

• O&A Repairs

• Calendar and Unscheduled Regrease

• Calendar and Unscheduled Depot Repairs

• Support Equipment Repairs

For pricing based on an assertion of commerciality IAW FAR 2.101:

See Section (c) of these instructions for the guiding regulations and expectations from the USG in terms of data to be provided by the contractor in the proposal.

For pricing subject to Truthful Cost or Pricing Data (FAR 15.403-4):

See Section (c) of these instructions for the guiding regulations and expectations from the USG in terms of data to be provided by the contractor in the proposal.

(e) For Program Management, ILS, Inventory Control Point, Supply Chain Management, Engineering Scope, Field Service Representatives (FSR) / Contractor Field Team (CFT) and Site Activation Scope:

(1) Proposed Labor hours/skill Mix: Regardless of the basis of the proposed pricing for the current effort (i.e. previous actuals, engineering estimate, level of effort, etc.), the proposal shall provide historical actuals from May 2018 to the USG’s RFP release date from the following efforts:

• Contract N0001923D0013 (PEO(A) PMA-207 KC-130J Propellors)

• Contract FA8504-18-D-0006 (R391 Propellors & Spares)

• Contract FA8124-23-D-0002 (AE 2100D3/T108 – Propulsion System Sustainment)

• Any commercial contract for which FSR, CFT or similar service was provided

Actuals provided should be inclusive of the following, at a minimum:

1. Task/Basis of Estimate (BOE) identification numbers

2. Period of Performance (PoP) per task with start and stop dates Applicable WBS(s) and PWS paragraphs per task to include BOEs

3. Mapping of previous contract period WBS to BOEs used in prior proposals (i.e. BOE matrix) CLIN traceability

4. Contract number

5. Actual cost and hours/skill mix(es)/RSC incurred, including a breakout of actuals as recurring/non-recurring costs. If performance is not complete on any of the specified contract actions, provide an estimate to complete and the basis for that estimate.

Actuals shall be by WBS with mapping of all BOEs related to the WBS actuals.

Within the BOEs:

1. Use of comparable historical actuals to estimate proposed hours/skill mix/costs is preferred to the maximum extent possible.

2. In the instance of new scope, proposal shall include comparisons to similar programs and clearly distinguish the new scope hours/skill mixes from scope based on actuals.

3. BOEs shall use actual and recent data, as close as possible to actual proposal submission date. Estimating rationale such as “per management direction”, “engineering judgment”, or any other debatable substantiation shall be avoided whenever possible. All rationale shall be factual based.

Specific to Field Service Representatives (FSR) / Contractor Field Team (CFT) Scope (PWS Section 6. Sustainment Site Support: Field Service Representatives (FSR), in addition to the historical actuals for the same scope or similar scope from May 2018 to the USG’s RFP release date, the contractor shall submit the following data:

1. The anticipated man-year or full time equivalent (FTE) hours and how the annual hours were derived Current salaries for FSRs/CFTs

2. Benefits package for FSRs/CFTs per location

3. The anticipated overtime hours per month, actual overtime hours incurred per month and per location and actual incurred overtime rate

4. Historical FSR/CFT replacement rate per location

Specific to Site Activation Scope, in addition to the historical actuals for the same scope or similar scope from May 2018 to the USG’s RFP release date, the contractor shall submit the actuals from KBay USMC site activation contract.

(f) Technical Manual Subscriptions:

The contractor shall provide a list of required technical manual subscriptions that are required for the performance of JPSS prior to or with its final proposal submission.

In addition, the contractor shall submit the historical costs per subscription incurred in support of current or previous similar efforts, inclusive of Government and non-Government requirements, in the proposal. The contractor shall submit a list of previous efforts being used as a basis for the JPSS effort.

The historical costs shall be segregable by previous effort, unit of issue (e.g. per month, annual cost, etc.) and inclusive of terms/conditions.

(g) Build-Up of the Flight Hour Rate:

The contractor shall submit a detailed build-up of the proposed Flight Hour Rate in the proposal.

Build-up shall identify the scope/costs to be included within the rate. Such scope/costs include:

1. Consumable Material Replenishment by part number

2. Repairable Component Replenishment by part number

3. Repairable Component Repair(s) by part number

4. Hazardous Material Replenishment

The contractor shall provide the basis for the proposed number of heads, number of demands, etc.. The calculation of the Flight Hour Rate shall be easily traceable.

For example:

Element Pricing Unit of

Issue

FHR

ILS (1 PM, 1 FSM, 2 LCs) $ $

Consumable Material Replenishment by part number

Repairable Component Replenishment by part number

Repairable Component Repair(s) by part number $ $

Hazardous Material Replenishment $ $

Etc… $ $

The contractor shall submit the historical costs per element incurred in support of current or previous similar efforts, inclusive of Government and non-Government requirements, in the proposal. The contractor shall provide a list of previous efforts being used as a basis for the JPSS effort in the proposal. Historical costs shall be segregable by previous effort/contract and element.

(h) Additional Data Requested by the USG

The contractor shall provide the following data in advance of the proposal, if possible:

1. MTBR for Each Propeller in Fleet

2. USG is requesting the hours since last shop visit for each propeller repair inclusive of all DoD customers

3. Data needs to be segregable by customer MTBR Calculation Methodology for Fleet

4. USG is requesting an outline of the calculation methodology (and any changes over time) OPL Data

5. USG is requesting the part number and purchasing/provisioning inclusive of all DoD customers

6. Data needs to be segregable by customer O-Level Shipments

7. USG is requesting actual usage data inclusive of all DoD customers Data needs to be segregable by customer

8. Rationale for the estimation of consumption rates

9. A copy of the most recent Configuration Management Plans Age of Propellers

10. Data needs to be segregable by customer

(i) Failure to provide supporting cost/pricing data:

The contractor shall provide other than certified cost or pricing data no later than (NLT) the date of proposal submission.

If the contractor elects not to respond or does not comply with these pricing instructions, the USG will document the refusal to comply with PCO requests for data resulting in notification to Secretary of the Air Force Deputy Assistant Secretary (Contracting) (SAF/AQC) and Director, Defense Pricing and Contracting (DPC) in accordance with DFARS PGI 215.403- 3.