CAD-JA_COMBINED_REDACTED_Redacted.pdf

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITY

Materiel Support Contracting Division

AFSC/PZA

3001 Staff Drive

Tinker AFB, OK 73145

Purchase Request (PR): FD2030-16-02116

II. NATURE AND/OR DESCRIPTION OF THE ACTION BEING PROCESSED

This individual Justification and Approval (J&A) authorizes the use of other than full and open competition procedures to obtain a follow-on commercial firm-fixed price requirements-type contract. The contemplated contract is for the remanufacture of the

F108 201 Main Engine Control (MEC) from Woodward, Inc. DBA Woodward Turbine

Systems (hereinafter: Woodward), Commercial and Government Entity (CAGE) Code:

66503. In accordance with FAR Part 12, a five year requirements type contract with a one year basic, and four-one year options is considered appropriate for this acquisition. The total estimated value of this award is $1,753,480 with an estimated award date of October

2018.

Previous Contract: FA8122-14-D-0007

Date of Award: 07/28/2014

Completion Date: 07/27/2017

Basis of Award: Negotiated

Note: This item was solicited in a competitive environment, however only one bid was received. There was no previous J & A.

III. DESCRIPTION OF THE SUPPLIES/SERVICES REQUIRED TO MEET THE

AGENCY’S NEEDS

Under the contemplated contract, Woodward will provide the remanufacture for NSN:

2915-01-454-3407PN for the F108 201 MEC.

There is one NSN that is included in this request for remanufacture. The F108 201 MEC provides control of fuel flow, variable bypass valves (VBV) and variable stator vanes

(VSV) position on the engine. Additionally, the MEC schedules the proper amount of fuel during acceleration and deceleration, regulates the flow during steady state operation to maintain a core engine speed, thus allowing the speed governor to sense speed and adjust fuel flow as necessary to maintain desired speed set by the power lever, and uses fuel from the pump as a hydraulic medium. The type of appropriation requested is

97X4930 and the total estimated dollars of this requirements contract is $1,753,480.

Contract Summary

Year Period of

Performance Remanufacture

Mishap

Investigation

Estimated

Dollars

Basic Yr 1 14 Dec 18 -13 Dec 19 $515,866.00

Option I 14 Dec 19-13 Dec 20 $529,764.00

Option II 14 Dec 20-13 Dec 21 $544,082.00 Option III 14 Dec 21-13 Dec 22 $562,116.00 Option IV 14 Dec 22-13 Dec 23 $580,508.00

Total Contract Cost $1,718,670 $2,732,336.00

PR Line Item 0001

Description: Remanufacture of the F108 201 MEC

Input/Output NSN: 2915-01-454-3407PN

Input/Output P/N: 8063-216 (9278M96P12)

Noun: Fuel Control, Main

Application: F108 Engine/KC-135R

Item Description and Function: The MEC schedules the proper amount of fuel during acceleration and deceleration, regulates the flow during steady-state operation to maintain a set core engine speed, thus allowing the speed governor to sense speed set by the power lever, and uses fuel from the pump as a hydraulic medium.

Type of appropriation: Contract Depot Maintenance (CDM Funds), 97X4930

Total Estimated Dollars for PR Line Item 0001: $1,738,670

PR Line Item 0001: Remanufacture of F108 201 MEC

Year Period of Performance Qty Unit Repair Cost Estimated Dollars

Basic Oct 2018 - Oct 2019 $329,370

Option I Oct 2019 - Oct 2020 $329,250

Option II Oct 2020 - Oct 2021 $349,430

Option III Oct 2021 - Oct 2022 $359,910

Option IV Oct 2022 - Oct 2023 $370,710

Total Estimated Dollars for PR Line Item 0001 $1,738,670

PR Line Item 0002

Description: Engine Mishap Investigation Reporting

Input/Output NSN: 2915-01-454-3407PN

Input/Output P/N: 8063-216 (9278M96P12)

Noun: Fuel Control, Main Engine

Application: F108 Engine/KC-135R

Item Description and Function: The Contractor shall perform an as-received inspection and test for each F108 201 MEC involved in an engine mishap, as described in the

Statement of Work (SOW) and CDRL A006.

Type of appropriation: Contract Depot Maintenance (CDM Funds), 97X4930

Total Estimated Dollars for PR Line Item 0002:

PR Line Item 0002: Engine Mishap Investigation Reporting

Year Period of Performance Qty Unit Repair Cost Estimated

Dollars

Basic Oct 2018 - Oct 2019 $6,556

Option I Oct 2019 - Oct 2020 $6,754

Option II Oct 2020 - Oct 2021 $6,956

Option III Oct 2021 - Oct 2022 $7,164

Option IV Oct 2022 - Oct 2023 $7,380

Total Estimated Dollars for PR Line Item 0002 $34,810

PR Line Item 0003

Description: Contract Data Requirements List (CDRL)

Input/Output NSN: 2915-01-454-3407PN

Input/Output P/N: 8063-216 (9278M96P12)

Noun: Data

Application: F108 Engine/KC-135R

Item Description and Function: F108 201 MEC Contract IAW SOW

Type of Appropriation: Not Applicable

Total Estimated Dollars for PR Line Item 0003: Not Separately Priced (NSP)

Due to the circumstances described below in Sections V, IX, and XI, there are no foreseeable actions that could be taken to develop competition. Therefore, it is considered appropriate to seek approval for more than one fiscal year. If other sources become known during the life of this contract, competition will be utilized to the maximum extent possible.

IV. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION

10 U.S.C. 2304 (c)(1), as implemented by FAR 6.302-1(a)(2)(iii), modified to reflect the procedures in FAR 13.5 in accordance with 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)

A. As the OEM, Woodward has provided the government the highly specialized commercial remanufacture under the previous negotiated contract listed in Section II.

The F108 201 MEC is highly specialized, vital and complex Aviation Critical Application Item (CAI) and involves the intricate processes that affect the integrity and durability of the F108 201 MEC. As GEES Cincinnati and Woodward are the only known capable sources of support for the F108 201 MEC, and GEES Cincinnati has since ceased production for the F108 201 MEC, this leaves Woodward as the only qualified source and the only company with the special tooling, equipment, and technical data to satisfy the government’s need.

B. As the OEM, Woodward, is the only known contractor that has the data, expertise, and processes necessary to remanufacture the F108 201 MEC sufficiently to meet the government’s requirement. The scope to remanufacture the F108 201 MEC includes specific proprietary knowledge and data on certain systems and applications that are not available to anyone else, except the qualified sources. Qualification Requirements (QR) have been developed for this service that allows potential sources the opportunity to submit a Source Approval Requests (SAR). As Woodward is the OEM and owns the proprietary data, the government does not have the ability to competitively solicit the remanufacture of the F108 201 MEC. The data needed is not physically available and is not possible to draft adequate specifications of the remanufacture for a competitive solicitation without the data. While QRs are published, the OEM is the only entity capable of approving a new source at this time.

C. C. The 421 Supply Chain Management Group (SCMS) believes that award to any other source would result in substantial duplication of cost to the government that is not expected to be recovered through competition and unacceptable delays in fulfilling the government’s requirement. It is estimated that the cost to reverse engineer this item is estimated to be greater than $20M and the effort would take approximately ten

(10) years; this time period involves reverse engineering design and a thorough test process to ensure its capability and safety. Delays in testing could increase both monetary and time values. The component function and design are too complex to consider reverse engineering initiatives. As this remanufacture is expected to take no more than five (5) years to complete, it would be time prohibitive to expend over ten

(10) years in the pursuit of additional sources as the delay in time would not be recovered through competition in the current market conditions.

D. Woodward was contacted as recently as 13 October 2017, inquiring if the company might be interested in selling the data rights and querying if Woodward would be interested in selling the unlimited data rights. Woodward responded negatively to this request on 13 October 2017. Woodward was again contacted on 08 January 2018 to inquire if the company would be interested in selling the data rights and again

Woodward responded negatively.

E. Accordingly, Woodward is the only contractor capable of providing the remanufacture of the F108 201 MEC as described in Section III above without the government experiencing substantial duplication of cost that could not be expected to be recovered through competition and unacceptable time and monetary delays in fulfilling its requirement.

VI. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS DEEMED

PRACTICABLE

A. A Sources Sought Synopsis (SSS) for the F108 201 MEC was posted to the Federal

Business Opportunities (FedBizOpps) website on 12 October 2016, and closed on 20

October 2016, (under Solicitation Number: 2915-01-454-3407). A SSS for the F108

201 MEC was again posted to the FedBizOpps website on 23 February 2018 and closed on 09 March 2018, (under Solicitation Number: FA812216R0027).

B. The basic requirement was described in the Sources Sought Synopsis (SSS) as market research along with a draft copy of the Statement of Work (SOW).

A. Under Solicitation Number 2915-01-454-3407, No responses were received and although the government does have licensing rights, as well as, QRs and the ability to approve them, without unlimited data rights, as stated in Section V, there is only one qualified source at this time. Under Solicitation Number FA812216R0027, one response was received by Triumph Accessory Services, however, without data rights from the OEM, Woodward, Triumph would not be able to become a qualified source.

C. In accordance with FAR 5.201, the requirement shall be synopsized and the Request for Proposal (RFP) will be posted to the FedBizOpps website.

D. A repatriation decision was made for the remanufacture of the F108 MEC at the

Depot. The F108 was deemed organic via the Depot Source of Repair (DSOR) in

May 1987 and the MEC is one of the remaining components to be repatriated.

VII. DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND

REASONABLE

The Contracting Officer will ensure that the items described herein are negotiated at a fair and reasonable price to the Government. A detailed cost analysis and price analysis will be performed, The Contracting Officer will request a technical evaluation from the

Defense Contract Management Agency (DCMA) to aid in the evaluation of the contractor’s proposal. The Contracting Officer will seek audit assistance from the

Defense Contract Audit Agency (DCAA) if necessary.

VIII. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE

RESULTS, OR A STATEMENT OF THE REASONS MARKET RESEARCH

WAS NOT CONDUCTED

As described in Section VI above, Market Research, in accordance with FAR Part 10, was conducted by synopsis of the proposed acquisition advising industry of the pending acquisition and soliciting inquiries from interested parties. Market research was conducted by a multi-functional team consisting of the Engineer, Program Manager, and

Production Management Specialist and completed on 01 December 2016. Market research consisted of Internet Searches and making inquiries of available Air Force data systems, such as, the Joint Engineering Data Management Information and Control

System, the Military Engineering Data Asset Locator System, and the Contract Integrated

Technical Information System, as well as, posting a Sources Sought Synopsis (SSS), to the FedBizOpps website on 12 October 2016 and closed on 20 October 2016, (under

Solicitation Number: 2915-01-454-3407). This research revealed the same sole-source market condition that has existed since this part has been originally manufactured by the

OEM in that Woodward has been found to be the only source available to fulfill the requirement.

A Sources Sought Synopsis (SSS) for the F108 201 MEC was again posted to the

FedBizOpps website on 23 February 2018, and closed on 09 March 2018, (under

Solicitation Number: FA812216R0027). This research revealed that one response was received by Triumph Accessory Services. While Triumph Accessory Services responded to the solicitation, currently the only approved source is Woodward. For Triumph

Accessory Services to become a qualified source, a source approval package, as well as, process validation through first article testing and possible site visits would be needed.

Triumph Accessory Services would also need to purchase data rights from Woodward, and as of 08 January 2018, Woodward has declined to sell the data rights.

IX. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND

OPEN COMPETITION

No further information.

X. LIST OF SOURCES, IF ANY, THAT EXPRESSED INTEREST IN THE

ACQUISITION

Woodward, Inc. CAGE: 66503

5001 N 2nd Street

Loves Park, IL 61111-5808

United States

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

Only one source is approved to remanufacture the F108 201 MEC and no other sources have submitted SAR packages to become an approved source. The Government does not own the data required to qualify a new source. To become an approved source, companies would have to contact Woodward to provide this service to the Government.

The government will continue to monitor the marketplace for potential sources and will continue discussions with the OEM regarding additional approved repair sources.

XII. CONTRACTING OFFICER’S CERTIFICATION

The Contracting Officer’s signature on the coordination and approval document evidences the Contracting Officer has determined this document to be both accurate and complete to the best of the Contracting Officer’s knowledge and belief.

XIII. TECHNICAL/REQUIREMENTS PERSONNEL’S CERTIFICATION

As evidenced by their signatures on the coordination and approval document, the technical and/or requirements personnel have certified that any supporting data contained herein, which is their responsibility, is both accurate and complete IAW 6.303-2(c).