CL19073001 J and A Redacted.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION (J&A)

LONG TERM CONTRACT (LTC) PROJECT CL19073001

SOLICITATION SPE7LX-20-R-X029

APRIL 1, 2020

SOURCE SELECTION INFORMATION – SEE FAR 2.101 AND 3.104

FOR OFFICIAL USE ONLY

ORIGINAL

1. Defense Logistics Agency (DLA) Land and Maritime (L&M) is the contracting activity.

2. The action being approved is the acquisition of supplies on an Other than Full and Open (Unrestricted) competition basis. The parts in this initiative have been determined to be commercial and will be procured under the procedures found in Federal Acquisition Regulations (FAR) Subpart 13.5 – Simplified Procedures for Certain Commercial Items. A J&A is required for sole source, code and part number acquisitions.

3. The supplies required to meet the using activity's needs are described as follows:

This solicitation is for two (2) National Stock Numbers (NSNs):

Explanation of Chart Column Header Names and Abbreviations:

CLIN: Contract Line Item Number NSN: National Stock Number CAGE: Commercial and Government Entity Number P/N: Part Number U/I: Unit of Issue

EA = Each AMC: Acquisition Method Code (See Section 5 for additional detail) AMSC: Acquisition Method Suffix Code (See Section 5 for additional detail) PIC: Place of Inspection Code

2 = Inspection/Acceptance at Destination QCC: Quality Control Code - CAA

First Position: C = Contractor Responsibility Second Position: A = No Quality Subsystem Requirements Third Position: A = No Specific Requirements

Quality Control Code - DAA First Position: D = Standard Inspection Second Position: A = No Quality Subsystem Requirements Third Position: A = No Specific Requirements

NAICS: North American Industry Classification System Codes 336350 Motor Vehicle Transmission and Power Train Parts Manufacturing

WSDC: Weapon System Designator Code and end item:

CLIN 0001: MRA (Parent WSDC for all ARMY MRAP [Mine Resistant

Ambush Protected] vehicles;

o “MRAP is a term for United States military light tactical vehicles produced as part of the MRAP program that are designed specifically

CLIN NSN Item Approved Source(s) CAGE Size Approved P/N(s) U/I AMC AMSC PIC QCC NAICS WSDC 0001 2520-01-361-0596 Plate, Intermediate, Fricton Clutch Allison Transmission 73342 Large 29536346 EA 3 D 2 DAA 336350 MRA 0002 3010-01-460-9681 Electronic Control Unit, Transmission Allison Transmission 73342 Large ECB007AW EA 3 B 2 CAA 336350 39A to withstand improvised explosive device (IED) attacks and ambushes.” (From Wikipedia)

CLIN 0002: 39A (Missile, Patriot);

o “The MIM-104 Patriot is a surface-to-air missile (SAM) system, the primary of its kind used by the United States Army and several allied nations. It is manufactured by the U.S. defense contractor Raytheon and derives its name from the radar component of the weapon system.”

(From Wikipedia)

The scope of this solicitation, and resulting contract(s), is Government supply support for the two (2) NSNs, as listed in Solicitation SPELX-20-R-X029 Attachment B-2 (Pricing and Delivery Spreadsheet). The proposed action is for the solicitation and award of a Firm Fixed Price (FFP), Indefinite Delivery Contract (IDC), to consist of three (3) base years and two (2) option years. The option years may be exercised at the discretion of the Government.

The Federal Supply Class (FSC) codes for these items are:

o CLIN 0001 FSC 2520 Vehicular Power Transmission Components o CLIN 0002 FSC 3010 Torque Converters and Speed Changers

The solicitation values for these NSNs are shown in the chart below:

The Annual Demand Value (ADV) for this acquisition project is with a three (3) year total value of (ADV * 3), and a five (5) year total value of

(ADV * 5). The ADV is based upon the value found in the REC_ MAX_VALUE_1YR field from the Max-Out Values tab of the project data pull, as supplied by the Sourcing Strategy Specialist on 03/09/20.

Contract minimum and maximum values will be used within the solicitation, and are for the life of the contract. The contract maximum amount is (ADV * 6), which will allow for any unexpected surges in demand through the life of the contract.

The total guaranteed minimum for this acquisition is which is calculated as the ADV * 0.01. The contract minimum will be held in reserve by the Government.

4. The statutory authority permitting other than full and open competition is:

10 U.S.C. 2304(c)(1) o (c) The head of an agency may use procedures other than competitive procedures only when—

CLIN NSN

Estimated Total

Base Year 1

(ADV)

Estimated 3 Year Contract

Value

(ADV * 3)

Estimated 5 Year Contract

Value

(ADV * 5)

Contract Maximum

(ADV * 6)

Contract Minimum

(ADV * 0.01)

0001 2520-01-361-0596 0002 3010-01-460-9681

Totals o (1) the property or services needed by the agency are available from only one (1) responsible source or only from a limited number of responsible sources and no other type of property or services will satisfy the needs of the agency.

The Government requires spare parts that are form, fit and functionally interchangeable with those currently used on the supported weapon system.

There are no known pending source approval requests with Engineering Support Activities (ESA) for these NSNs.

5. If restricted to the only source(s) of supply, include source(s) and CAGE code:

The use of the authority cited is based on:

Acquisition Method Code (AMC) 3: Acquire, for the second or subsequent time, directly from the actual manufacturer.

Acquisition Method Suffix Code (AMSC) B: This part must be acquired from a manufacturing source(s) specified on a source control or selected item drawing as defined by the current version of DoD-STD-100. Suitable technical data, Government data rights, or manufacturing knowledge are not available to permit acquisition from other sources, nor qualification testing of another part, nor use of a second source part in the intended application. Although, by DoD-STD-100 definition, altered and selected items shall have an adequate technical data package, data review discloses that required data or data rights are not in Government possession and cannot be economically obtained. If one (1) source is available, AMCs 3, 4, or 5 are valid.

o For the item coded AMSC B (CLIN 0002), Allison Transmission (CAGE 73342) is the approved manufacturing source for this item to be specified on the source control drawing.

Acquisition Method Suffix Code (AMSC) D: This part requires engineering source approval by the design control activity in order to maintain the quality of the part.

Existing unique design capability, engineering skills, and manufacturing knowledge by the qualified source(s) require acquisition of the part from the approved source(s). The approved source(s) retain data rights, manufacturing knowledge, or technical data that are not economically available to the Government, and the data or knowledge is essential to maintaining the quality of the part. An alternate source must qualify in accordance with the design control activity's procedures, as approved by the cognizant Government engineering activity. The qualification procedures must be approved by the Government engineering activity having jurisdiction over the part in the intended application. If one

(1) source is approved, AMCs 3, 4, or 5 are valid. If at least two (2) sources are approved or if data is adequate for an alternate source to qualify in accordance with the design control activity's procedures, AMCs 1 or 2 are valid.

o For the item coded AMSC D (CLIN 0001), Allison Transmission (CAGE 73342) is the only source to have received approval by the design control activity, and to have the expertise, skill and knowledge to manufacture this part.

CLIN NSN Item Approved Source(s) CAGE Size Approved P/N(s) AMC AMSC 0001 2520-01-361-0596 Plate, Intermediate, Fricton Clutch Allison Transmission 73342 Large 29536346 3 D 0002 3010-01-460-9681 Electronic Control Unit, Transmission Allison Transmission 73342 Large ECB007AW 3 B

, a Quality Assurance Specialist at DLA L&M-FLBC, completed a technical review for these items on 02/20/20, stating “The tech/quality review for project CL19073001 has been completed and is recommended for LTC. Technical certification is attached. Data has been posted cFolders.”

On 02/24/20, provided additional information regarding CLIN 0002, stating that “Per my discussion with , lead sales manager for Allison Transmission, P/N 29561675 is purchased as a BLANK transmission control unit. Once it is connected to the Allison Docs in house program and is specifically calibrated, the part then becomes P/N ECB007AW. Mr.

Remali stated that correct P/N to order for NSN 3010-01-460-9681 is ECB007AW”.

6. Efforts to ensure that offers are solicited from as many sources as practicable are:

Market research efforts are detailed in Section 8.

A Sources Sought notice, which included a market survey, was posted on the beta.SAM.GOV web site from 02/05/20 through 02/13/20, with no responses received.

A synopsis will be posted on the beta.SAM.GOV web site, and will run for a period of 15 days.

On the first business day after the close of the synopsis, the solicitation will be posted on the internet, via the DLA Internet Bid Board System (DIBBS). The solicitation will run for a period of at least 30 days.

On the day that the solicitation is posted to DIBBS, copies of the solicitation will be e-mailed to the approved source for these NSNs, along with their known distributors.

7. I hereby determine that the anticipated cost to the Government will be fair and reasonable.

The total value of this acquisition exceeds $2,000,000.00. However, per FAR 15.403(b)(1) & (3), Certified Cost or Pricing Data (CCPD) will be not be required. Based upon market research, these are commercial items and competition between dealers is expected.

The price analysis of historical contracts, as well as current and future years will be based on the Global Insights Producer Price Index (PPI) forecasts. The Global Insights PPI forecast data is provided by the DLA L&M Pricing Support group, and provides timely, accurate price & cost analysis, allowing procurement professionals to understand supplier cost structure and better negotiate supplier proposals.

Based upon the above techniques to be used, the Contracting Officer hereby anticipates costs to the Government will be fair and reasonable.

8. Market Research/Efforts to Obtain Competition:

Market research was conducted to find the following:

o Researching items on-line via the internet for availability and features.

o Reviewing previous procurements of items and determining previous acquisition methods.

o Determining vendor interest in long-term contracting for these NSNs.

o Researching/gathering information regarding commerciality of the items.

o Vendor size and business status information.

o Delivery estimates.

o Distributor/dealer involvement.

Summary of market research:

o A Sources Sought notice was run on beta.SAM.GOV, from 02/05/20 through 02/13/20, with no responses received.

o The following companies were sent a market survey questionnaire on 02/05/20:

Allison Transmission (CAGE 73342); large manufacturer; sole approved source Clarke Power Services (CAGE 1SHN6); small distributor; prior awardee Penn Power Group (CAGE 62860); large distributor; prior awardee

Completed market surveys were received from all three (3) companies, and the key points from each are summarized below:

Allison Transmission (CAGE 73342); sole OEM/approved source for two (2) CLINs

, Aftermarket Manager, Defense Business

Verified status as a large manufacturing business for NAICS 336350 in the System for Award Management (SAM) on 03/25/20. Allison Transmission is the sole OEM/approved source for Part Numbers (P/Ns) 29536346, ECB007AW

Market Survey Details:

Distributors include Penn Power, Clarke Power, Central Power and WW Williams

Will not quote directly to the Government Interested in a LTC but only through their distributors

Indicates that items are commercial but will not provide invoices or catalog pricing

Note from , regarding commerciality: “We categorize our parts into two (2) categories. Commercial and tracked military. Tracked military is just for tracked vehicles like tanks. Commercial means wheeled military and commercial trucks. These two (2) parts fall under the commercial trucks”.

Clarke Power Services (CAGE 1SHN6)

, Government Sales Manager

Small Distributor (805 employees) for Allison Transmission (73342) Verified Small Business status for NAICS 336350 on 03/25/20

Market Survey Details:

Interested in LTC; agreeable

Did not respond to questions regarding commerciality

Penn Power Group (CAGE 62860)

, Contract Administrator 877-736-6332

Large Distributor (500 employees) for Allison Transmission Verified large status for NAICS 336350 in SAM on 03/25/20

Market Survey Details:

Interested in LTC; agreeable to

Indicates that the items are commercial o Provided Commercial Invoice o Provided internal Inventory Item Inquiry, Information received regarding the commerciality of the item:

A Google search was done on 03/25/20, for CLIN 0001, NSN 2520-01-361-0596, P/N

29536346, with the following results:

The part was found on GSA Advantage:

https://www.gsaadvantage.gov/advantage/catalog/product_detail.do?gsin=11000009853749

The part was also found on two (2) commercial online sales sites (shown below):

o FindItParts.com https://www.finditparts.com/products/981007/allison-29536346 o PowerLineComponents.com https://www.powerlinecomponents.com/allison/29536346/plate-reaction

A Google search for CLIN 0002, NSN 3010-01-460-9681, P/N 29561675 was conducted on 03/25/20. This part was not found on GSA Advantage. However, it was found on the commercial site below:

o PacificPowerGroup.com https://www.pacificpowergroup.com/product/29561675-electronic-controls-wt3

The two (2) NSNs on this acquisition are determined to be commercial. Therefore, this acquisition will proceed in accordance with the procedures of FAR Subpart 13.5 – Simplified Procedures for Certain Commercial Items.

9. Additional facts supporting other than full and open competition are:

Based upon the technical review and certification, completed by the Product Specialist, technical data is not available to the Government, and cannot be developed to permit full and open competition. The data presently available reflects the minimum needs of the Government.

As noted in Section 5, the Product Specialist supplied a technical certification on 02/20/20, which included a Memo for Record (MFR) - Justification for Restricting Competition, indicating that the AMC/AMSC codes had been reviewed.

A DD2579 Small Business Coordination Record was reviewed, and concurrence obtained, from Heidi Treadway, the Contracting Officer, on 03/12/20. In accordance with FAR 7.107-2(a)(3), the DD2579 was then referred to the DLA L&M Office of Small Business Programs. The document was signed by, and concurrence received from, Small Business Specialist on 03/12/20. The Small Business Administration (SBA) Procurement Center Representative, , has concurred with an Unrestricted solicitation, and signed and returned the DD2579 on 03/13/20.

10. A listing of sources, if any, indicating an interest in the acquisition:

Clarke Power Services (CAGE 1SHN6) Penn Power Group (CAGE 62860)

Allison Transmission (CAGE 73342), the approved source for these items, expressed an interest in the IDC, but will only quote through their distributor(s).

11. This item is subject to the following methods of locating additional sources:

Procurement History: The two (2) NSNs being procured were previously included on

LTC SPE7LX-15-D-0093, awarded to Clarke Power Services (CAGE 1SHN6) on 03/10/15.

The Acquisition Plan for this 2015 project indicated that a J&A was required. However, a copy was not found in Records Management. The buyer for the previous LTC, was contacted on 03/20/20, to see if she might able to provide a copy of the J&A. responded by saying “

The

Acquisition Plan detailed the market research efforts for the project, including the sending of market surveys to the approved source, along with distributors.

The Acquisition Plan indicates that a Sources Sought notice was run on FedBizOps from 08/08/14 to 08/15/14, with no responses received. After market research was completed, the acquisition was to be synopsized on FedBizOps for 15 days. A review of solicitation SPE7LX-14-R-0248 in Records Management shows that it opened on 08/28/14 and closed on 11/26/14.

In lieu of the J&A, a copy of the Acquisition Plan is included as Attachment 1.

The complete Procurement History is included as Attachment 2.

The Government will continue to conduct market research, to see if changes occur in the marketplace that would enable future actions for these items to be competitive. This solicitation contains the DLAD Procurement Note entitled Offers for Part Numbered Items (L04). This clause provides that the Government will consider alternate offers, and that alternate offerors should submit a source approval request (SAR) package that will be referred to the engineering activity. If the current procurement cannot be delayed, due to mission requirements, and to allow sufficient time for the engineering activity to determine whether to approve the alternate offer, the SAR package will be considered for future awards.

At this time, the requirement/guidance in DFARS PGI 206.304 has been fulfilled.

Attachments:

1. Acquisition Plan from LTC Solicitation SPM7LX-14-R-0248

2. Procurement History

CONTRACTING OFFICER CERTIFICATION

I hereby certify that the information contained in this justification is accurate and complete to the best of my knowledge and belief.

Contracting Officer

Heidi Treadway Typed name of Contracting Officer

APPROVAL/CERTIFICATION

I have reviewed and approved this justification:

Competition Advocate

APPROVAL REQUIREMENTS

( X ) $700,000 to $13,500,000 Competition Advocate

TREADWAY.HEI

DI.E.1299371855

Digitally signed by

TREADWAY.HEIDI.E.129937185

Date: 2020.04.02 11:05:59 -04'00'

SHEARER.MAR

Y.E.1250702449

Digitally signed by

SHEARER.MARY.E.1250702449

Date: 2020.04.09 10:09:52 -04'00'