Attachment 7 - FINAL JA VC25 - Redacted.pdf

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

CONTROLLED UNCLASSIFIED INFORMATION

April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 4 of 7April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 4 of 7

5007 Sim Fill In Hour 10

Total:

Total For 5 Year Ordering Period + EOS:

IV. Statutory authority permitting other than full and open competition.

AFFARS 5313.501 - 10 U.S.C. 2302b, Implementation of Simplified Acquisition Procedures (41 U.S.C. 1901)

V. Demonstration that the contractor's unique qualifications or nature of the acquisition requires the use of the authority cited above (applicability of authority).

As confirmed in the FAA Qualified Flight Simulator Training Device list, dated 09 March 2021, Atlas owns and operates both a Boeing 747-200 and Boeing 747-400 FAA Level C certified Flight Simulation Training Device (FSTD) at one location. The Atlas Air facility in Miami, FL, has one of only two of the required B747-200 simulators in the continental United States (CONUS). The other B747-200 simulator is in Denver, CO, and is owned by A.T.S., who does not currently own/operate or have access to a Boeing 747-400 Level C certified simulator. B747-400 FAA Level C certified simulator is required for training to support the transition from the VC-25A to the VC-25B.

The impact of not having all of the required training in one location would be too severe to the mission of the PAG.

The impact would result in the PAG losing an additional 40 to 60 days of pilot availability to fly missions each year while the pilots are traveling to/from and in training at a separate location. Also, the amount of TDY (temporary duty travel) costs would increase by an estimated $30K to $60K annually, which would be a 20-40% rise in TDY costs for the PAG. The PAG has a volatile mission schedule due to the demands of transporting the POTUS all over the world at a moment's notice. Additional travel and training days would limit the PAG pilots' and FEs' availability to perform their essential service when it is required. According to the Department of Defense's (DOD) personnel tempo (PERSTEMPO) management, as a result of the nation’s extended involvement in contingency operations around the globe, some service members have experienced prolonged, frequent, and/or stressful deployments. Preparation for deployments (e.g., training, exercises, temporary duty assignments) can lead to extended working hours or frequent travel away from home station. The pace of operations for individuals is commonly referred to as PERSTEMPO and can affect quality of life, work satisfaction, and overall morale for members and their families. It is a DOD initiative to reduce unnecessary time away from duty station and the service members' families.

In addition, the PWS requires B747-400 simulator training because the PAG utilizes the B747-400 simulator to help with the transition from the VC-25A to the VC-25B. Continuity of Concept of Operations across both platforms is essential to the successful training and certification of the flight crew. Keeping this capability in close proximity is a unique and critical capability to the PAG. Specifically, having both simulators close to each other is imperative as the crew is able to test a maneuver on one simulator and quickly try the same maneuver on the other simulator, which allows them to more fully understand differences in the aircraft. This enables the PAG pilots to gain the most benefit possible out of each training session as it provides expertise while aiding in the seamless transition to the new aircraft.

The training offered by Atlas enables pilots to obtain an ATP rating or Type certification and the flight engineers to receive an FE rating. This is accomplished with FAA approved Atlas Training Center Evaluators (TCE) who administer the ATP Rating/Type Rating and Flight Engineer Certification. Also, Atlas has FAA Part 142 certified instructors, who are qualified to teach the required training on the VC-25A. These instructors meet the requirements of FAA Part 142.47 and 142.53. No other contractor has the capability to provide all of the required training for both the B747-200 and -400 IAW the FAA regulations and PWS requirements.

VI. Description of efforts made to ensure that offers are solicited from as many potential sources as practicable.

As noted above and in the Market Research Report (MRR), the active FAA Qualified Flight Simulator Training Device list, dated 09 March 2021, provides a list of companies that own/operate the required simulators needed to deliver the required training. Per the list, only two CONUS companies own/operate a FAA Level C certified B747-200 simulator, Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 5 of 7April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 5 of 7 and seven CONUS companies own/operate a FAA Level C certified B747-400 simulator. Of the two companies that own/operate a FAA Level C certified B747-200 simulator, only one, Atlas Air, owns/operates a Level C certified B747-400 simulator as well. In May 2021, a search of the the AbilityOne Procurement List of Services, located at https:// www.abilityone.gov/procurement_listprocurement list/, found that the mandatory source, AbilityOne Program, is unable to fulfill this requirement.

A Sources Sought Notice, FA4452-22-Q-VC25A-SIM, and a copy of the draft PWS were posted to the beta.SAM website on 14 April 2021. The notice sought out possible sources and technical capability of large and small businesses for this requirement. The notice requested that interested businesses submit a brief capability package demonstrating their ability to provide the required simulator configurations and perform the services depicted in the draft PWS.

Responses to the Sources Sought Notice were due by 12 May 2021. On 28 April 2021, an email was sent directly to the two companies who currently have B747-200 FAA Level C certified simulators, Atlas Air and A.T.S. Inc., to inform them of the Sources Sought Notice. Only one capability package, from Atlas Air, was received on time. An assessment of Atlas Air's capability to meet the VC-25A training requirement was conducted on 17 June 2021. The MP, after reviewing Atlas Air's capability statement, determined that Atlas Air is technically capable of performing all of the PWS requirements.

A.T.S. was contacted again via email on 14 June 2021 specifically asking if A.T.S. has access to a B747-400 simulator and if A.T.S. would be interested in responding to a solicitation for this requirement. In addition, a phone call was made to A.T.S. and a voicemail was left asking the same questions on 17 June 2021. On 12 July 2021, A.T.S. responded via email stating that they were interested in responding to a solicitation. After further communication, on 20 July 2021, A.T.S.

submitted a response to the original Sources Sought Notice stating that they do not have a B747-400 simulator or have access to one in the Denver, CO area. The response also stated the following: "The draft PWS in [SIC] written for 2 totally different aircraft. The B-747-200 aircraft has a Flight Engineer position and analog instrumentation while the B-747-400/8 does not have a Flight Engineer position and has digital instrumentation. The chances of locating one facility that can accommodate the needs of both aircraft will be extremely difficult. For the reasons stated above I would suggest splitting the contract RFPs into two separate units, one for the -200 aircraft and one for the -400/8 aircraft."

The MP reviewed the feedback from A.T.S. and provided support as to why separating this requirement into two requirements is not an option. He stated, "ATS only has a -200 capability, which means we would have to have a separate TDY/expenditures/time away/etc. for -400/-8 training. The next closest -400/-8 facility to Andrews is at UPS in Louisville, KY or Kalitta Air in Ypsilanti, MI." Further discussions revealed that the additional impact to the mission if the pilots and FEs were required to attend training via two different contracts would be too severe to the mission as explained above in section V. B747-400 FAA certified Level C simulator is required for training to support the transition to the VC-25B, and there is only one company, Atlas Air, who owns/operates both simulators that are required in the same facility. There is not a FAA approved B747-400 Level C simulator in or located near the A.T.S. facility.

As determined by the MP, the capability package received from Atlas Air demonstrates the company's technical ability to meet this acquisition. Per market research, there is not a reasonable expectation that two or more capable offerors will submit priced offers in response to a solicitation.

VII. Determination by the Contracting Officer that the anticipated cost to the Government will be fair and reasonable.

IAW FAR 13.106-3(a), the Contracting Officer (CO) must determine that the proposed price to the Government is fair and reasonable. The Government anticipates using the price analysis techniques IAW FAR 13.106-3(a)(2)(ii), comparison of proposed prices found reasonable on previous purchases; and (iv), comparison with similar items in a related industry to ensure the cost to the Government is fair and reasonable.

VIII. Description of the market research conducted and the results, or a statement of the reasons market research was not conducted.

Various methods of market research were conducted by the CO and MP from 01 March 2021 to 05 August 2021.

A Sources Sought Notice, FA4452-22-Q-VC25A-SIM, and a copy of the draft PWS were posted to the beta.SAM website

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 6 of 7April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 6 of 7 on 14 April 2021. One response from Atlas Air was deemed technically capable, and one late response from A.T.S. was determined not capable to perform all of the required PWS tasks.

Source Lists were reviewed, including the active FAA Qualified Flight Simulator Training Device list, dated 09 March 2021, that shows which companies have the approved simulators to provide the required training. Only two companies have a B747-200 FAA certified simulator and seven companies have a B747-400 FAA certified simulator. In May 2021, the AbilityOne Procurement List of Services was also reviewed. The AbilityOne program does not have the approved simulators to provide VC-25A Pilot and FE Training.

Internet searches were conducted to determine if VC-25A Pilot and FE Training is still considered to be a commercial service. It was concluded that the VC-25A is a commercial derivative of the Boeing 747-200 that has been modified to include top of the line equipment, capability for air-refueling, and a baggage loader. Flight training services for the B747-200/400 are provided in the commercial marketplace at established prices, standards, terms, and conditions.

Therefore, this requirement can be satisfied by commercial contracting practices along with commercial contracting provisions and clauses under FAR Part 12.

Government Databases such as SAM and FAPIIS indicated that no active debarments and/or suspensions exist for Atlas Air and further stated that the vendor does not have delinquent tax debt.

The 763d ESS Small Business Professional reviewed the Sources Sought Notice prior to posting it.

Known sources were contacted on 28 April 2021, via email, which was sent directly to the two companies who currently have B747-200 FAA certified simulators, Atlas Air (LB) and A.T.S. LLC (Small Disadvantaged Business/Woman Owned Small Business). That email informed them of the Sources Sought Notice. A.T.S. was contacted again via email on 14 June 2021 specifically asking if A.T.S. has access to a B747-400 simulator and if A.T.S. would be interested in responding to a solicitation for this requirement. In addition, a phone call was made to A.T.S. and a voicemail left asking the same questions on 17 June 2021.

The CO reviewed the market research from the current contract, FA445217D0003, which is summarized in Section C of the MRR.

Finally, the MP is very knowledgeable and well versed in the pilot training industry. Both the MP and the CO have conducted market research on a regular basis via conversations with USAF pilots and FEs as well as C-37, C-21, C-32, C-40, and VC-25 pilot/FE training contractors, internet searches, reading articles, and staying up to date on what is occurring in the commercial aviation training industry.

IX. Any other facts supporting the use of Other Than Full and Open Competition.

Historically, there has been little to no viable competition for the VC-25A Pilot and FE Simulator Training requirements.

Only two contractors have submitted responses to the VC-25A pilot and FE training requirement dating back to at least 2012.

Atlas Air currently performs these services under contract FA4452-17-D-0003, a FFP, requirements contract. A full and open RFP, FA4452-17-R-0017, was posted to the Federal Business Opportunities (FBO) website on 09 Feb 2017 with a due date of 13 March 2017. Two proposals were received: Atlas Air (CAGE 1KF51, LB) and Kalitta Air (CAGE 1VL55, LB). Atlas Air's final price proposal was % less than Kalitta Air's proposal and was determined technically acceptable; as such, Kalitta Air's proposal was not evaluated for technical acceptability. Today, Kalitta Air no longer has a B747-200 certified simulator approved by FAA, and thus the company is not capable of meeting the VC-25A Pilot and FE Simulator Training requirement.

Prior to contract FA4452-17-D-0003, VC-25A Pilot and FE Training was provided by Atlas Air under contract FA4452-12- D-0007, a FFP, requirements contract. A full and open RFP was posted to the FBO website on 12 April 2012 with a due date of 11 May 2012. Only one proposal, Atlas Air's, was received.

Boeing received a $3.9-billion contract in July 2018 to build two 747-8 aircraft for use as AF1, set for delivery by December 2024. There have been recent reports that Boeing asked for an extension due to production issues caused by the shut down of major supply industries during 2020 and early 2021. The USAF plans to sunset the current AF1 upon completion, testing, and transition of the replacement aircrafts; therefore, there is not currently any expectation to continue services for VC-25A Pilot and FE Training after the expiration of the subject follow on contract. Besides the two AF1s, there were only five B747-200s in service as freighters and zero as passenger aircraft as of July 2019. Since

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 7 of 7April 2021 CONTROLLED UNCLASSIFIED INFORMATION Page 7 of 7 industry is aware of the new aircraft in production and there is already such a low demand for B747-200 crew training, companies are unlikely to invest in building or maintaining B747-200 simulators required for the VC-25A training.

X. List of any sources that expressed, in writing, an interest in the acquisition.

See Section VI above.

XI. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before making subsequent acquisitions for the supplies or services required.

As mentioned above, the current AF1 is scheduled to sunset upon the completion, transition, and training of the replacement aircraft that Boeing is currently contracted to produce. The current VC-25A will be retired and training for that specific aircraft will no longer be needed. It is not expected that another acquisition will be done for this requirement after the subject follow-on contract expires.

XII. Certification by the Contracting Officer.

As evidenced by my signature above, I have determined this document to be both accurate and complete to the best of my knowledge and belief.

XIII. Certification by the technical/requirements personnel.

As evidenced by our signatures above, we certify that any supporting data contained herein, which is our responsibility, is both accurate and complete.