C1_JA_-_MRO_PV_Korea_SPM50005DBP07_(5th_Bridge).pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

(C)(1) UNIVERSAL SODEXHO – KOREA REGION – SPM500-05-D-BP07

MAINTENANCE, REPAIR AND OPERATIONS (MRO) PROGRAM

1. Defense Logistics Agency (DLA) Troop Support, Construction and Equipment Supply Chain, is the contracting activity.

2. The action being evaluated for approval is the ability to solicit for DLA requirements on the basis of other than full and open competition.

3. The proposed acquisition will be a bridge contract for a period of five months to provide for the purchasing of facilities Maintenance, Repair and Operations (MRO) supplies and associated incidental services. The Tailored Logistics Support Prime Vendor (TLS PV) contract provides for MRO materials and other supplies including, but not limited to: Heating, Ventilation and Air Conditioning (HVAC); plumbing supplies (including bath and shower items); electrical products (including generators, wire, connectors, sockets, outlets, lights, etc.);

tools of various kinds; chemical, lubricating, and rubber products and products including same;

construction supplies (including but not limited to cement, lumber and plywood, bricks, blocks, steel, aluminum, and other metal products, conduits, prefabricated structures, etc.); perimeter security items such as barriers, barbed wire, concertina wire, and sand bags (also used for erosion prevention); communication devices (such as walkie-talkies, two-way radios, etc. used by maintenance personnel); and various other MRO supplies needed by war-fighters stationed in the Korea Region. The maximum dollar value, based on current sales data, for this proposed contract is $18.8 million (approximately $3.76 million per month) for the five month period. The original contract, SPM500-05-D-BP07, was awarded to Universal Sodexho, March 31, 2005 with an effective date of July 31, 2005 to support military customers with MRO requirements in the Korea Region, which is defined as the Republic of Korea (ROK) (South Korea). The original contract was issued with a two-year base period and 3 one-year options. Four bridge contracts have since been awarded, starting with the first effective as of August 01, 2010 for a one-year period. The second bridge contract was awarded for eight months from August 01, 2011 through March 31, 2012. The third bridge contract was awarded for one year from April 1, 2012 through March 31, 2013. The fourth and current bridge contract was awarded and made effective April 1, 2013 and will expire October 31, 2013. The proposed fifth bridge contract will have the same terms and conditions with an effective period of November 1, 2013 through March 31, 2014.

Should a competitively awarded contract be issued ahead of the projected timeframe and the contract guaranteed minimum is satisfied, delivery orders will no longer be placed under this (c)(1) bridge contract. The proposed fifth bridge contract will use the same number as the current contract: SPM500-05-D-BP07.

4. The statutory authority permitting other than full and open competition is 10 U.S.C. 2304 (c)(1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

5. There is one contract in place supporting Korea under the existing MRO Program. The contract, SPM500-05-D-BP07, is critical to maintaining continuity of support for war-fighters stationed in the Korea Region. The requisite MRO products and associated incidental services are deemed to be available only from the current contractor, Universal Sodexho, in the required time-frame. Award to any other source would result in unacceptable delays in fulfilling the Agency’s requirements. Universal Sodexho has established relationships or partnering

MRO KOREA REGION – SPM500-05-D-BP07 Page 2 of 5 arrangements with various suppliers, including local suppliers, and is capable of providing and delivering material to the geographic region through established transportation systems. They also have customer support representatives in place, an understanding of customer requirements and the ordering process, and established systems interfacing with DLA Troop Support.

The follow-on contract under the MRO Program has been delayed. When the initial solicitation was issued, DLA Troop Support utilized a multiple award strategy in an effort to enhance competition; however, after further consideration and additional market research, including information received from customers, the Agency determined that it would not be possible to provide adequate customer support in the Korea Region utilizing the multiple award strategy, as the competitive process would negatively impact the Agency’s ability to support day-to-day requirements. The additional steps and procedures required to process delivery orders under a multiple award strategy would result in longer lead times. Also, the current systems used to process delivery orders for multiple award contracts do not have automated award processes in place, which negatively impacts the order processing time and drastically increases customer wait time. Under the current MRO contracts operating under a single award strategy, automated awards are processed for a number of orders and a fair and reasonable price determination is made on a post-award basis in compliance with the Contract Management Plan. Furthermore, the Agency recognizes that the level of customer support provided under the current MRO Korea single award contract would be degraded because a multiple award contract would eliminate direct interface between customer and contractor. In order to ensure fair opportunity to all MRO Prime Vendor contractors operating under a multiple award contract, each MRO Prime Vendor contractor must be provided the opportunity to meet with customers and assess requirements for projects with incidental services. This would result in significant delays while each vendor conducted site visits and obtained necessary information to offer on the requirement. The Agency had previously made a determination to exclude incidental services from the scope of the follow-on initiative based on the inability to manage incidental service requirements effectively under a multiple award strategy. Based upon the foregoing reasons, including additional market research and customer feedback, the Agency reconsidered its determination and decided that it is necessary to provide for the incidental service requirements, which requires a revised single award strategy necessary to meet mission requirements and customer needs. Because of the extent and number of changes made to the acquisition strategy, a determination was made to issue an amendment cancelling the solicitation on April 12, 2012. These changes also caused the Agency to reevaluate the source selection method. The initial solicitation anticipated using the Lowest Price Technically Acceptable Source Selection Method; however, it was decided that the Tradeoff Source Selection Method was preferable in that it is in the Government’s best interest to consider award to other than the lowest priced technically acceptable offeror and establish evaluation criteria that would best serve the Agency’s needs, by ensuring satisfactory performance and technical proficiency up-front.

Due to significant changes in acquisition strategy, all pre-award contracting documents had to be rewritten. During the re-write, additional market research was conducted, and numerous meetings were held to discuss pricing strategy, evaluation methodology and Information Technology issues. The solicitation was subsequently issued on November 20, 2012, with a Pre- Proposal Conference held on December 13, 2012. Numerous questions from vendors and significant pricing strategy changes during the solicitation period pushed back the closing date from January 4, 2013 to March 15, 2013. The Source Selection Evaluation Board’s (SSEB) non-price evaluations were completed end of May 2013. Progress was delayed on this acquisition from unanticipated, complex pricing issues that arose during the evaluation stage which required

MRO KOREA REGION – SPM500-05-D-BP07 Page 3 of 5 resolution. Negotiations, Reverse Auction, final evaluations, the preparation of award documents and review will need to take place prior to award. It is estimated that it will take approximately five months to complete the contract award for this initiative. Consequently, the follow-on procurement will not be awarded prior to October 31st, 2013, the expiration of the current bridge contract. The anticipated award of the follow-on contract is expected by January 31, 2014. This proposed bridge contract is required to allow for final reviews and approvals, negotiations, a Reverse Auction, and award, as well as to provide contract coverage during the 60-day “ramp up” or transition period; therefore contract coverage must be in place until March 31, 2014.

It is essential that DLA Troop Support maintain the ability to purchase MRO supplies and associated incidental services, in the period from November 1, 2013 until March 31, 2014. The MRO contract supplies numerous items required for the maintenance and operation of Government facilities throughout the Korea Region. This proposed bridge contract will ensure continuous contract coverage providing for an uninterrupted supply of vitally needed MRO supplies and incidental services. If this contract is not awarded and coverage lapses, DoD and DLA’s ability to provide much-needed supplies will be significantly impaired in as much as the traditional DLA supply system could not support the volume of individual orders that are processed through the MRO program. Universal Sodexho is the only established firm capable of providing continued support for these vital MRO items in the Korea Region while the follow-on competitive acquisition is being completed. Universal Sodexho’s satisfactory performance on the existing contract indicates that it has the necessary capabilities to provide material and support throughout the region without delay. A new contractor would require at least a 60-day “ramp-up” period to form relationships with local suppliers and manufacturers located in the Korea Region, identify potential delivery service and transportation requirements, establish adequate purchasing, distribution and quality control systems, hire local customer support representatives, and implement systems that would interface with DLA Troop Support, which would further result in unnecessary costs and impede continuous support to the military in this region.

Universal Sodexho currently operates a warehouse with company owned and operated delivery service in Korea which allows them to fill urgent requirements within 24 hours and Universal Sodexho has been designated Invited Contractor Status under the United States Forces Korea (USFK) Status of Forces Agreement (SOFA) with the ROK. Beyond this, a contractor would need to invest a significant amount of time and cost to develop sources and understand the customers in the Korea Region.

6. This requirement will be synopsized in FedBizOpps as required by FAR Subpart 5.2. In addition, this justification will be made available for public inspection, after award, in accordance with FAR 6.305.

7. As the Contracting Officer, I hereby determine that the anticipated cost to the Government will be fair and reasonable based on price analysis, including comparison to available commercial pricing, General Services Administration (GSA) pricing and other Government contracts.

8. The requirement for this bridge contract will be synopsized. No other firms will be solicited since the required supplies and services are essentially only available from the incumbent contractor in the required timeframe.