B1 - 0231-22-281-00.1_JA Redacted.pdf

J&A Number: 0231-22-281-00.1

Code: 0231

P.R. Number: 21-D2D-028

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

JUSTIFICATION

1. Contracting Activity

The Naval Sea Systems Command, Naval Surface Warfare Center, Philadelphia Division

(NSWCPD), Code 0231.

2. Description of Action Being Approved

Award of a Firm-Fixed-Price contract on a sole source basis to Cincinnati Gearing Systems, Inc.

(CGS) for the repair, upgrade, and testing of three (3) Landing Craft, Air Cushion (LCAC) gearbox test stands.

3. Description of the Supplies or Services

The planned acquisition will provide for repair, upgrade, and testing of three (3) LCAC gearbox test stands. The LCAC gearbox test stands are used for performing spin and load tests, which are required for the verification of assembled or rebuilt LCAC gearboxes.

MOPAS Acquisition Strategy Plan No. 0231-22-281-00.2 covers this acquisition.

The Government’s minimum needs have been verified by the certifying technical and requirements personnel.

The total estimated dollar value of this procurement is $1,067,892 and will utilize

Operation and Maintenance, Navy (O&MN) funds as indicated below.

DEPARTMENT OF THE NAVY

NAVAL SURFACE WARFARE CENTER

PHILADELPHIA DIVISION

5001 SOUTH BROAD STREET

PHILADELPHIA PA 19112-1403

IN REPLY REFER TO:

Funding

Type CLIN FY22 Total

O&MN

CLIN 0001 – Forward offset gearbox test stand $355,964 $355,964

O&MN

CLIN 0002 – Main engine gearbox test stand $355,964 $355,964

O&MN

CLIN 0003 – Aft offset gearbox test stand $355,964 $355,964

Total $1,067,892 $1,067,892

The Period of Performance for this effort will be one (1) year from date of award.

4. Statutory Authority Permitting Other Than Full and Open Competition

10 U.S.C. 2304(c)(1), Only One Responsible Source and No Other Supplies or Services Will

Satisfy Agency Requirements, as implemented by Federal Acquisition Regulation (FAR)

Subpart 6.302-1.

5. Rationale Justifying Use of Cited Statutory Authority

The LCAC has three (3) distinct gearboxes and corresponding test stands used for acceptance and vibration testing. The gearboxes were originally designed and built by the now defunct Steel

Products Engineering Company (SPECO). In 1983, CGS acquired SPECO and all test stand components were physically relocated from the SPECO facilities located in Springfield, OH to

CGS. The gearbox test stands were built and tested by CGS and are utilized by the U.S. Navy aboard the LCAC Class (1-91) ships. CGS is the Original Equipment Manufacturer (OEM) for the LCAC gearbox test stands. CGS developed the technical documentation required to repair and maintain the test stands at private expense and considers this technical data proprietary. The gearbox test stands certify production gearboxes for the LCAC Program as well as gearboxes for the Japanese Maritime Self-Defense Force (JMSDF) LCACs. The Navy has been utilizing these gearbox test stands for the LCAC Program for the previous 30 years and they were most recently procured under Contract No. N65540-05-C-0014 on a sole source basis from CGS. The gearboxes in the LCAC Program have unique configuration that are certified to ensure proper form, fit and function. The gearbox test stands are currently used to certify the gearboxes for the

LCAC Class (1-91) ships. When a gearbox fails, the gearbox is turned into the stock system as a

Condition F asset. Once gearboxes are repaired and certified on the test stands, the gearboxes are returned to the stock system as Condition A assets. This acquisition will provide for the repair, upgrade, and testing of the test stands in accordance with the statement of work (SOW) so that gearboxes can continue to be repaired and the LCAC craft can remain operational. Without these operational test stands, it is estimated that the supply of Condition A gearbox assets will be depleted within the next three (3) to five (5) years, which will negatively impact the Navy’s ability to deploy LCAC craft when needed.

The proprietary manuals and drawings allow CGS to break apart the LCAC gearboxes to their individual piece parts. With that level of detail, CGS is able conduct spin, load (torque), and vibration acceptance testing for the 972 production gearboxes for the LCAC Program as well as the gearboxes for the JMSDF LCACs. As such, CGS owns the rights to the proprietary manuals and drawings required to support a repair of the LCAC gearbox test stands. No other entity other than CGS has been authorized or qualified to repair, upgrade, and test these LCAC gearbox test stands. On 30 November 2021, the Government reached out to the OEM to inquire about purchasing the data rights. On 01 December 2021, the OEM provided an official response regarding this inquiry, stating that “CGS considers the development technical data pertaining to the LCAC transmission test stands as proprietary and would not consider selling the data rights.”

The Government owns and has access to the repair manuals required to repair the LCAC gearbox test stands. However, the Government does not possess full capabilities to troubleshoot and maintain the test stand over its lifecycle. CGS is the sole designer and fabricator of the equipment, and as such, is the only contractor with the background, technical knowledge and expertise, design familiarity, facilities, and access to proprietary information and processes necessary to comply with the requirements of this acquisition. No other firm possesses the requisite capabilities or access to proprietary information necessary to meet the requirements.

Therefore, without access to the proprietary information detailed above, the Navy cannot develop these processes and procedures with the requisite level of detail and precision necessary to execute the required repairs.

In order to maintain operational LCAC craft availability for the reasons stated above, an unacceptable delay would occur should the Government seek an alternate vendor. An alternate vendor would need to complete the tasks listed in the chart below prior to being considered for such work.

Table 1 – Estimated Alternate LCAC Plant Schedule Task Duration

Initial Design, Build, Test and Delivery of Alternate LCAC

Centrifugal Test Stand models 18 months

LCAC Transmission System Gearbox Repair, Upgrade, Modification and Engineering 12 months

LCAC Gearbox and Gearbox Test Stand Design and Engineering

Familiarization Training 18 months

LCAC Gearbox Test Stand Operational Testing 6 months

Deliver the first set of repaired and certified Condition A gearboxes to the Government 18 months

Procurement of additional suitable GFM inventory 18 months

Total Time 90 months (7.5 years)

In addition to the estimated time required as listed in Table 1, significant time and effort will be required to manufacture and support all the different centrifugal LCAC test stands with a capacity of one test stand each for the lift fan gearbox, main engine gearbox, and propeller gearbox. The duration of these tests cannot be estimated as a full overhaul of the LCAC system would be required. The above also does not include the time required to source replacement bearings for the main engine gearbox test stand to be taken from Government Furnished Material

(GFM) inventory held at CGS. With the exception of special tooling provided to CGS by the

LCAC Program to disassemble, inspect, reassemble, and test gearboxes, no other GFM is required.

Award to any other source would result in unacceptable delays in fulfilling the agency’s requirements, as the Navy requires these gearbox test stands to be repaired within the twelve (12) month ordering period in order for the LCAC craft to remain operational. Failure to award this contract to CGS would jeopardize immediate and future operational availability of LCAC craft. As a result, CGS is the only source available that is capable of providing the services in an acceptable time to fulfill the agency’s requirement for ship readiness and mission capability for the duration of the twelve (12) month ordering period.

Based on the above, the only capable source is CGS due to the nature of the requirement. No other source will possess the intimate knowledge and expertise needed to ensure the Government’s needs are met.

6. Description of Efforts Made to Solicit Offers from as Many Offerors as Practicable

In accordance with DFARS PGI 206.302-1, a Request for Information/Source Sought was posted to the beta.SAM.gov website on 16 August 2021 and closed on 30 August 2021. Additionally, a synopsis was published on the beta.SAM.gov website on 30 August 2021 and closed on 15

September 2021. No responses were received to either posting. No additional market research was conducted because it is not practicable, for the reasons discussed in paragraph 5 above, for any other contractor than CGS to provide the required services.

7. Determination of Fair and Reasonable Costs

The Contracting Officer has determined that the anticipated costs to the Government for the services covered by the J&A will be fair and reasonable. The contractor will submit a formal price proposal with other than certified cost or pricing data and sufficient information to support the accuracy and reliability of the estimate. The contractor’s proposal will be reviewed by experienced technical analysts and contract specialists with the aid of necessary field pricing support. The Contracting Officer will use price analysis for negotiating a fair and reasonable price.

8. Actions to Remove Barriers to Competition

For the reasons set forth in paragraph 5, the Government has no plans at this time to compete future contracts for the services covered by this procurement. If another potential source emerges, the Government will assess whether competition for future requirements is feasible.