Class DF for Consolidation of Sole Source Contract Not Meeting Substantial Benefits Threshold 31Dec2026.pdf

DEFENSE LOGISTICS AGENCY

LAND AND MARITIME

P.O. BOX 3990

COLUMBUS, OHIO 43218-3990

MEMORANDUM FOR RECORD

SUBJECT: Class Determination and Findings for Consolidations of Sole Source Contract Requirements Not to Exceed $100 Million for Procurements Not Meeting the Substantial Benefits Threshold at FAR 7.107-2(d)(1)

Introduction:

With the migration towards long term contracts, DLA Land and Maritime routinely procures multiple items under a single solicitation. When items that were formerly procured under two or more separate contracts are procured under a single solicitation with a greater value than either of the separate contracts, the resulting solicitation is considered a consolidation of contract requirements. In accordance with FAR 7.107-2, the consolidation of contract requirements is not authorized for acquisitions exceeding $2 million unless the Senior Procurement Executive (SPE) makes a determination that the consolidation is necessary and justified. The SPE has delegated the authority to approve such determinations to the CCO for acquisitions valued over $2 million up to $10 million, and to the HCA for acquisitions valued over $10 million up to $100 as outlined in DLAD 7.107-2(b). This Determination and Findings (D&F) is a Class D&F authorizing the consolidation of sole source requirements with no prior dealer/distributor participation or interest from alternate sources of supply for acquisitions between $2 million and $100 million. References to sole source requirements within this D&F include part numbered items as well as requirements for the sole source repair, engineering, and technical services of those items. This D&F shall expire December 31, 202 .

Discussion:

The consolidation of contract requirements is authorized when, based in part upon the results of market research, a D&F is executed finding the consolidation necessary and justified. Where the consolidation does not meet the thresholds for a substantial benefit under FAR 7.107-2(d)(1), the finding is appropriate when the benefits are critical to the Agency’s mission success (FAR 7.107-2(e)(1). Benefits can be measured in terms of costs, quality, acquisition cycle, terms and conditions, or any other benefits. Prior consolidations of sole source requirements under a single solicitation have been found to be necessary and justified with essentially identical rationale. Consequently, a Class D&F is appropriate.

Consolidations of sole source requirements achieve similar benefits: consistent terms and conditions; decreases in acquisition lead-times; enhanced delivery schedules; reduced and stable pricing through buying related parts or services under a single contract; improved supply availability to preclude backorders; use of a more efficient ordering process; reduction of contract administration actions through use of a single point of contact; and improved vendor management of orders.

DLA is the military’s premier logistics provider, and it is imperative that DLA structures its contract actions to maximize benefits while minimizing costs. The consolidation does this by reducing administrative costs which, in turn, helps to keep DLA’s cost recovery rate low.

Critical benefits include increased material availability, reduction in lead time, and increased warfighter equipment operational readiness.

Several steps are taken during the pre-solicitation process to determine if alternate sources exist and to identify the impact of the consolidation on small business concerns. A technical review is conducted to verify the item or service description and approved source. Market research is performed to confirm that there are no other sources expressing interest in supplying or performing the sole source requirement at the time of the acquisition. The impact of the consolidation on small business concerns is determined negligible based on the lack of multiple sources or evidence of interested sources. A Justification and Approval is executed to document that all items or services thereof are individually certified as sole source. A sources sought notice and synopsis are posted to.SAM.gov advertising the government requirements.

Sole source requirements found to be competitive during this process are excluded from the sole source solicitation.

Consideration of Alternate Contracting Approaches:

Alternative contracting approaches include procuring these items via individual purchase orders (for items valued below the simplified acquisition threshold) or per-item or service on numerous stand-alone contracts. These strategies would not generate the support and cost benefits anticipated under a single solicitation/contract, and lead-times to negotiate and award individual contracts would be greater.

Actions to Mitigate Impact to Small Business:

These items and services have no prior dealer/distributor participation or interest from potential alternate sources. Notwithstanding, to include small businesses in acquisitions not set aside for small business that offer a significant opportunity for subcontracting, the solicitation will require a subcontracting plan and evaluation factors for small business participation in accordance with FAR 15.304(c)(3)(ii) and (c)(4).

Class Determination and Findings:

In view of the foregoing, I hereby determine:

Those proposed acquisitions for sole source, part numbered items and/or associated services with only one approved source, without prior distributor support or evidence of another firm having expressed interest in providing or servicing the items as an alternate source, constitute a consolidation of contract requirements. 15 U.S.C. 657q; FAR 7.107-2.

There are benefits of consolidating the contract requirements. The expected benefits do not meet the thresholds for a substantial benefit at FAR 7.107-2(d)(1), but are critical to the Agency’s mission success.

The consolidation of sole source requirements is necessary and justified.

A Class Determination and Findings authorizing consolidation of sole source requirements is appropriate as they involve essentially identical justifications and the requirements of FAR 1.703 have been met.

This Class Determination and Findings is limited to those sole source requirements with an estimated value of $100 million or below. For consolidated requirements with an estimated value over $100 million, an individual D&F is required. The Contracting Officer shall ensure that individual actions are within the scope of this Determinations and Findings

This Class Determination and Findings shall become effective upon signature and will expire on December 31, 202 . This Class Determination and Findings request has been reviewed and concurred with by DLA Land and Maritime Office of Counsel (G) and Office of Small Business Programs (DU).

ROBERT D. JOHNSON, SES

Acquisition Executive, Land and Maritime

JOHNSON.ROBE

RT.D.1230338090

Digitally signed by

JOHNSON.ROBERT.D.12303380

Date: 2024.12.20 15:21:40 -05'00'