Consolidation Memo_POM JOC_REDACTED.pdf

DEPARTMENT OF THE ARMY

US ARMY CORPS OF ENGINEERS (USACE)

SOUTH PACIFIC DIVISION (SPD)

SACRAMENTO DISTRICT (SPK)

CONSOLIDATION MEMORANDUM

INDEFINITE DELIVERY/INDEFINITE QUANTITY (IDIQ)

JOB ORDER CONTRACT (JOC)

PRESIDIO OF MONTEREY

MONTEREY, CALIFORNIA

April 2023

The Federal Acquisition Regulation (FAR) 2.101 defines “Consolidation or consolidated requirement” as follows:

“Consolidation or consolidated requirement --

(1) Means a solicitation for a single contract, a multiple-award contract, a task order, or a delivery order to satisfy–

(i) Two or more requirements of the Federal agency for supplies or services that have been provided to or performed for the Federal agency under two or more separate contracts, each of which was lower in cost than the total cost of the contract for which offers are solicited (Services); or

(ii) Requirements of the Federal agency for construction projects to be performed at two or more discrete sites. (Construction)

Consolidation of requirements with a total value exceeding $2 Million must be justified.

(2) “Separate contract” as used in this definition, means a contract that has been performed by any business, including small and other than small business concerns.”

I have reviewed this requirement and associated market research and determined that consolidation, in accordance with 15 U.S.C 657q, FAR 2.101, FAR 7.107-2, DFARS 207.170, and AFARS 5107.170, and UAI 5107.170 is both necessary and justified. My review resulted in the following findings.

FINDINGS

1. Introduction: On June 20th, 2022, the United States Army Corps of Engineers (USACE), Sacramento District (SPK) agreed to a $20M requirement for Sustainment, Restoration and Modernization (SRM) construction services at the Presidio of Monterey, (POM), Ord Military Community (OMC) and the US Army Signal Agency (USASA), POM Enclave (UPE), located in Camp Roberts, San Miguel, CA (Attachment 1). In accordance with Army Federal Acquisition Regulation Supplement (AFARS) 5117.9004-1 (a), the Directorate of Public Works (DPW) of POM evaluated the feasibility and appropriateness of a JOC (Job Order Contract) to satisfy the subject requirement and determined a JOC represents the most advantageous approach. (Attachment 2).

2. Description of the Procurement Action

a. Project Description: The scope of this acquisition includes Sustainment, R estoration, and Modernization (SRM) as well as minor construction projects (Not to exceed $2M in value) at POM, Ord Military Community (OMC) and the US Army Signal Agency (USASA), POM Enclave (UPE), located in Camp Roberts, San Miguel, CA. This includes a wide variety of repair and minor construction services, to include but not limited to:

• Mechanical

• Plumbing

• Structural

• Electrical

• Lighting installation or repair

• Heating, ventilation, and air conditioning (HVAC)

• Instrumentation repair incidental to construction

• Asbestos and lead based paint abatement

• Other environmental remediation incidental to the construction

• Anti-terrorism and force protection systems upgrades, repairs, and installation

• Interior or exterior painting of buildings or structures incidental to construction

• Temporary structures

• Emergency repair services

The recommended NAICS code for this procurement is 236220, Commercial and Institutional Building Construction, with a small business size standard of $45M.

b. Procurement History: The proposed contract has no successor. This will be the first JOC contract for POM and installations under POM, with the Sacramento District. In the past, POM has used their own internal DPW resources or USACE stand-alone contracts to complete minor construction projects. To replace the typical government shops (which provide carpentry, plumbing, electrical, etc. repairs and services), Mr. Sam Farr, the US Representative for the 17th and 20th Districts in California, had enacted special separate legislation to allow POM to directly contract with the host City of Monterey. The organization is titled Presidio Maintenance and Service Agency (PMSA). The intent of the organization was not to utilize DPW funds for construction, and their contract with the installation is currently in place and doesn’t satisfy a need to provide construction services.

c. Requirements being consolidated: This new requirement includes a variety of construction projects to be performed at various sites throughout POM, the nearby area known as the Ord Military Community (OMC) and the US Army Signal Agency (USASA), POM Enclave (UPE), which is a small portion of Camp Roberts, all located in CA.

Attachment 3 shows estimated projected workload, funded with SRM, in support of these three areas, all of which are maintained by the POM DPW.

d. Acquisition Strategy/Procurement Summary: The acquisition strategy is to compete a total small business set-aside procurement, for a single Firm Fixed-Price (FFP) Indefinite Delivery/Indefinite Quantity (ID/IQ) Job Order Contract (JOC) award, with a one-year base and four 12-month option periods. This will be an Invitation for Bid (IFB).

Task order size to range from a minimum of $5,000 to a maximum of $2,000,000 (but not to exceed the amount of Sustainment, Restoration and Modernization (SRM) authority delegated to the installation by the Army Command (ACOM) and/or HQDA as referenced in AFARS Subpart 5117.9000(a). Estimated annual workload is $4M per year, with total JOC capacity of $20M for use at any time during the period of performance. Period of performance includes a one- year base period and four 12-month options. Task order prices will be calculated based on the pre-set Unit Price Book (UPB), the quantity required and applicable coefficients (normal working hours, other than normal working hours, hazardous abatement, and non-pre-priced items). The Government will award an initial $50,000 minimum task order guarantee IAW AFARS Part 5117, with subsequent task orders issued on an as needed basis. The approved DD2579 Small Business Coordination Record will be found in Paperless Contracting File (PCF) Cabinet.

e. Applicability of Consolidation Definition: This requirement meets the definition of consolidation as the proposed IDIQ JOC includes minor construction work that will be performed at two or more discrete sites and the total estimated value exceeds the $2M threshold, 15 U.S. Code § 657q(a) (2and FAR 7.107-2(a).

f. Rationale for Consolidation: The IDIQ will provide immediate need for minor construction for POM, OMC and the UPE. The requested consolidation of two or more discrete locations will increase efficiency, streamline processes, decrease costs, and increase the probability of quality performance.

JOC pricing will be based on the R.S. Means Facilities price book with a city cost index (CCI) for Monterey, California, thus providing a greater benefit to the Government from both a cost and technical perspective. The Government has a subscription with RS Means – Unit Price Book. The Government and Contractor are required to utilize this RS Means Price Book to price out projects. The Contractor applies a coefficient, and the level of effort is negotiated for the cost saving. When an IDIQ type contract is used, it reduces the total lead time for accomplishing sustainment, restoration, and modernization (SRM) projects at installations. Additionally, having multiple projects performed at the same installation by one prime contractor will encourage higher quality and ensure consistency when performing similar requirements. The contractor will gain knowledge of the local conditions and requirements to perform work at POM through the necessary interactions with Government representatives when scoping work requirements which leads to an improvement in the quality of work.

By utilizing the R.S. Means Facilities UPB with a CCI for JOC this is a collaborative construction project delivery method that enables the organization to get numerous, commonly encountered construction projects done quickly and easily through IDIQ or multi-year umbrella contracts. JOC reduces unnecessary levels of engineering, design, and contract procurement time along with construction project procurement costs by awarding long-term contracts for a wide variety of renovation, repair and construction projects. JOCs provide steady work for small businesses while limiting risk to the government. These contracts are often referred to as IDIQ contracts in the federal government. With an emphasis on partnering and teamwork between owners and contractors, JOC provides the methodology to execute a wide variety of minor construction and maintenance projects indefinite delivery, indefinite quantity, fixed-price, multiple simultaneous orders for renovation, rehabilitation and repair work for large facilities and infrastructures. JOC contractors are selected based on responses to the request for proposal and utilizing best value trade off procedures. JOC is about performance, reliability, dependability, and quality. At the same time, JOC is about performance-oriented results and delivering a quality product within budget and time constraints. To that end, the JOC contractor will provide “on call” construction services from concept to close-out and when required by the Government, negotiations will be a part of the process for issuance of work.

A major element of the JOC contracting process is the use of a UPB or list, which provides preset costs for specific construction tasks. The unit price book can cover nearly every construction, repair or maintenance task, whether it’s minor renovation projects or recurring projects like bathroom renovations, installing carpeting, replacing windows or doors, or even painting, the pricing is developed from the line items in the unit price book or list. If a task is not in the UPB, it can be negotiated, priced and added to the book, at any time, via addendum and contract modification.

As part of the proposal process, the contractor submits a coefficient (a multiplier) to be applied to the preset unit prices appearing in the UPB or list unless specified otherwise.

The coefficient must include not only the contractor’s overhead and profit, but also any necessary adjustments to the UPB, based on the contractor’s costs in the local area of the contract (which are functions of labor costs, subcontractor base, market conditions and client-specific terms and conditions).

Post award, the Contracting Officer or Ordering Officer uses the coefficient to calculate the project price, using preset unit prices, multiplied by quantity, multiplied by the coefficient.

For each project, the owner, the Directorate of Public Works, and the contractor will follow the same five steps:

(1) Conduct a joint scope meeting onsite to review the work and discuss the construction schedule;

(2) Prepare a detailed scope of work;

(3) Contractor prepares a price proposal, via an automated software platform, using unit prices from the UPB, required quantities, and contract coefficient(s), and submits a proposed construction schedule, list of subcontractors and other documents required by the owner;

(4) Owner reviews price proposal/estimate to ensure the right tasks and quantities were used;

(5) If owner is satisfied with price, schedule, subcontractors, etc. owner may issue work order for the project.

This relationship and partnership carry with it a strong motivation for the JOC contractor to provide outstanding service and high-quality work, as this provides the owner incentive to issue additional work orders; A direct correlation between the work assigned by the facility owner or manager to the JOC contractor’s performance. The four option year periods ensure the contractor maintains a high level of performance as an incentive to maintain the contract for the duration, it serves as a check and balance system while providing incentive for a quality product. JOCs foster increased communication between the contractor and owner, which further enhances the partnering relationship and contributes to successful delivery of mission.

Key JOC characteristics include:

• Standard specifications established in a master contract with a summary of work, also including any specific or client-driven conditions.

• A unit price book or list containing unit prices for construction tasks.

• Facility owner issues a work request.

• A guarantee of minimum amount of work for the contractor. This is usually a small amount for consideration – a requirement in most states for contracts.

• Issuance of contractor’s work orders based on owner’s requirements.

• Costs for individual work orders are calculated by multiplying the unit prices by the quantities multiplied by the contractor’s coefficient.

• Open communication between public entity facilities team and awarded JOC team, including a kick-off partnering session between everyone utilizing the contract.

Major JOC advantages include:

• Fast and timely delivery of projects.

• Low overhead cost of construction procurement and delivery.

• Development of a partner relationship based on work performance.

• Reduced legal fees and reduced program management fees.

• Transparency with itemized unit pricing

• Elimination of change orders. Contractor initiated change orders should not occur in a properly functioning program.

Other JOC advantages include:

• Partnering and performance incentives result in high-quality construction and service and enhanced quality control. Quality JOC contractors have reduced and even eliminated punch lists.

• Simplified design documents and acquisition processes negate the need for complicated and repetitive contract documents and reduce contract administrative costs.

• The speed of JOC contracting ranges from 10 days to 21 days from request to construction start, since JOC projects don’t demand soliciting and acquiring a contract along with detailed plans and specifications.

• Employment of smaller subcontractors in the area to perform the work, allowing for the majority of the project funds to be spent locally.

• Minimal risk for the owner in the event of problems with the contractor because the owner can stop using the contract at any time. If a performance-based system is also used, the JOC contractor can be terminated for lack of performance.

• A win–win attitude or motivation for both the contractor and the facility owner produced by and through the long-term relationship.

The task orders under this JOC are primarily intended to provide a timely response to maintenance, and repair projects which will not exceed the SRM authority delegated to the installation IAW AFARS 5117.90 Job Order Contracts.

A JOC Ordering Officer will be appointed and will have authority to award task orders up to the appointed ordering limit. The JOC Ordering Officer will have the authority to award modifications to task orders not to exceed the cumulative total of the ordering limit. All task orders and modifications which exceeds the Ordering Officer's authority will be ordered by an SPK Contracting Officer. IAW AFARS 5117.90 Job Order Contracts, the Contracting Officer is the official ultimately responsible for management of all aspects of the JOC.

SPK cannot reasonably anticipate all of the future requirements for POM, particularly when the vast majority of projects will be funded with SRM appropriations; and therefore, future work plan projections are less predictable than MILCON programs that may be funded several years in advance. As a result, the establishment of this JOC has been determined to be the best contracting vehicle to accommodate the demand associated with a continually changing workload, customer priority list, and immediate need that may arise.

Past experience has shown that customers, such as new tenants in a building, routinely ask for small projects requiring alteration and repair, as most are reimbursable projects.

Because of the uncertainty of requirements, it is necessary to have a contractual vehicle in place to provide the capacity and flexibility to rapidly respond to changing workloads and priorities.

The standard pricing and specification utilizing a published UPB, resulting in efficient and effective estimating, design, and fixed-price construction. The purpose of the JOC contractor striving to achieve a high percentage rate for completion of projects on time and on budget. Also, the JOC process provides for a single contract to be used for the delivery of multiple or repeated work orders without having to re-bid the same work as required in other commonly used delivery systems. It allows for back-and-forth communication and development efforts throughout a project. This differs greatly from the traditional delivery method of design–bid–build. JOC provides the greatest advantage in situations involving recurring work when delivery times, type of work and quantity of work are indefinite. While JOC is not used for new construction, this is defined as “Design” the construction requirement producing the technical specifications and drawings and preparing the construction cost estimate which requires the contractor a straight-forward construction project for alterations, renovation, repair and maintenance of existing facilities and infrastructures.

In conclusion, a consolidation of contract requirements will reduce the cost to the Government by utilizing a single JOC contractor and Unit Price Book resulting in high-quality construction and service and enhanced quality control. Quality JOC contractors have reduced and even eliminated punch lists; by simplified design documents and acquisition processes negate the need for complicated and repetitive contract documents and reduce contract administrative costs.

g. Extent of Consolidation: The proposed contract action will result in the consolidation of 150 minor construction projects from FY 24 through FY29. The projected value of the forecasted projects is approximately $20M.

h. Funding: Task Orders under this JOC will be primarily funded by SRM funds from Army customers. Consolidated projects will be identified on separate line items with the appropriate funds.

i. Applicable Statutes/Regulations: Reference 15 U.S.C. § 657q; FAR 7.107- 2, Consolidation, and AFARS 5107.170.

j. Market Research, Analysis and Results: According to 13 CFR 124.504(D) and the Partnership Agreement between the U.S. Small Business Administration and the US Department of Defense this procurement will be awarded on the basis of competition limited to small business firms due to the availability of capable small business contractors.

(1) Internet Tools. Market research incorporated a search of various internet tools to locate potential vendors. The NAICS code of 236220 Commercial General Contractors was used. Websites used for market research were:

a. Small Business Administration’s Dynamic Small Business Search (DSBS)

b. General Services Administration’s System for Award Management (SAM.gov)

c. Federal Procurement Data System – Net Generation (FPDS – NG)

For details about how many firms were identified as a result of these internet searches, please refer to the Market Research Report completed on this procurement.

(2) Sources Sought Announcement. A Sources Sought announcement was posted to SAM.gov on 7 November 2022. This announcement was closed on 1 Dec 2022. 18 firms responded to the SS announcement. For details on these firms, please refer to the Market Research Report completed on this procurement

(3) Industry Day. SPK Contracting hosted an industry Day at the MOTCO Installation on 24 January 2023. At that time, the Government intended to include POM and MOTCO installation as a singular JOC contract. It has since been determined that this is not the best path forward. The extensive geographical distance between the installations would severely limit competition and be difficult challenge for the contractor to adequately respond to various projects at the different installations. It makes better business sense for the government to establish separate JOCs at MOTCO and the POM installation. For details on these firms, please refer to the Market Research report that was completed on this procurement.

Market research serves several purposes, including identifying sources capable of meeting the government’s need, promoting competition, identifying whether commercial items can meet the government’s needs, and identifying whether small businesses are capable of meeting the requirement. Firms were determined potentially capable if they were found capable of performing 15% or more of the work listed above. Consolidation of tasks will result in significant benefits and 8(a) small business firms will be afforded the maximum opportunity to participate in competition for award. The awarded 8(a) small business concern will be required to perform at least 15 percent of the cost of the contract, not including the cost of materials, with its own employees, in accordance with FAR 52.219-14(c)(3). For further breakdown of the Market Research, reference Market Research Report located in PCF.

3. Feasible Alternatives and Impacts:

a. Alternative 1: Stand Alone “P” or “C” Type Contracts: An alternative contracting approach would be to procure the requirements on a stand-alone basis through individual “P” or “C” Type contracts.

(i) Quality Assurance/ Quality Control: The quality assurance reviews, and inspection and acceptance are made by DPW personnel and are the same as those for any other construction contract. The government determines the type and extent of government quality assurance based upon the particular acquisition.

On the other hand, Quality Control (QC) is the responsibility of the contractor.

Contractors are responsible for carrying out their obligations as set forth in the contract terms and conditions, for controlling product quality, and for offering to the government only those supplies and services conforming to contract requirements. A JOC contractor's coefficient includes the costs associated with quality control.

Unlike in a “C” type contract, a JOC contractor is strongly incentivized to provide consistency of high-quality construction, as the Government is under no obligation to provide new work once the guaranteed minimum is achieved. Quality is also improved by the cooperative and mutually beneficial climate that results from necessary interaction between the Government representatives and contractor when jointly scoping work requirements. Unlike a standalone, a JOC allows for a project to be delivered within 15-21 days compared to the months it takes to establish a stand-alone C or P type contract. The time savings ensures the installation is able to quickly address and satisfy the customer needs/requirements.

(ii) Acquisition Cycle: As it is required with all acquisitions the acquisition for the JOC also identifies and establishes milestone dates and critical events, to ensure timely accomplishment of the acquisition. JOC efforts of minor construction results in a more efficient and effective use of resources to design, develop, or produce quality systems. This includes ensuring that only necessary and cost-effective requirements are included, at the most appropriate time in the acquisition cycle, in solicitations and resulting contracts.

According to the Job Order Contracting Performance 2015 Industry Survey conducted by Arizona State University:

(https://www.researchgate.net/publication/308600630_Job_Order_Contracting _Performance_and_Industry_Analysis), the procurement phase for a task order accounted for 20% of the overall performance period compared to 27% - 29% for stand-alone contracts.

Analysis of the contract procurement times under other JOCs, such as the current White Sands Missile Range (WSMR), NM JOC support these findings. The average JOC task order procurement time (RFP issuance to award) was 91 days compared to a procurement time of 342 days for traditional competitive “C” type contract Design Bid Build (DBB) similar size and similar scope projects.

According to the DOD Army Job Order Contracting Guide, task orders for individual projects can usually be estimated, scoped, negotiated, and issued in three to four weeks.

The acquisition cycle times needed to solicit and award a base contract is the same for Alternative 1 and 2. Although there may be potential time savings in subsequent task orders, the overall cycle time would not be offset by using a MATOC. This is generally in the range of 150-360 days; orders generally require a minimum of 90 days to issue. (See Table 1 for the quantifiable impact).

Use of a stand-alone “C” contract does not allow flexibility required for end of the year small project execution. Often, these minor renovation or repair projects are identified and are required to be executed within 30 days of project identification.

The use of a stand-alone "C" contract requires specifications creation and editing, market research, cost estimating, and engineering to facilitate the creation of the RFP. This process takes over 60 days and must be completed prior to issuance to the small business contractor making the utilization of this contract vehicle inappropriate for many of the projects.

(iii) Cost: The established cost goals for the acquisition and the rationale supporting them discusses the related cost concepts to be employed, including the rationale for quantity, learning-curve, and economic adjustment factors to be tracked, and enforced. The stand-alone contracts don’t necessarily reduce lead times for acquiring small to medium sized repair contract work by eliminating the need to develop design specifications each time a work requirement is identified.

The contracting lead time is intended to be shortened since JOC eliminates the need to formally advertise and solicit or locate qualified new contractors for stand-alone type contracts. This allows the maximum cost saving in labor for establishing new stand-alone contracts for each new project that arises.

Job Order Contracting provides a quick and cost-effective means of acquiring SRM needs. A JOC contract can be used to accomplish SRM projects of buildings, structures, or other real property. JOC cannot be used to purchase supplies, services, or architect and engineer (A-E) services, or major construction that is complex in nature. A single award contract often makes it difficult for the government to secure the same price reductions and contractor performance improvement that would occur if the contractor was competing against other qualified contractors throughout the contract.

The use of job order contract with the use of the UPB, allows and provides flexibility for POM DPW to take continuous advantage of the competitive forces of the commercial marketplace which will result in lower prices, better quality, reduced time from requirements identification to award, and improved contractor performance in satisfying customer requirements. With the exception of the requirement for mandatory use of multiple award contracts for advisory and assistance services, the "preference" for multiple award contracts is just that, a preference. Federal Acquisition Streamlining Act (FASA) recognizes that single award contracts may be preferable in some situations. The implementing regulations provide a range of available exceptions and make clear that the contracting officer (CO) is expected to make a sound business decision as to whether single or multiple awards may be more advantageous to the government. No separate written determination is necessary when the determination to make a single award is contained in a written acquisition plan or when a class determination has been made.

These types of contracts typically include government established unit prices for specific line items needed to complete the requirements of the delivery order.

Award determinations are made by selecting the mix of line items to be used for a project and multiplying the mix of line items by the coefficient bid by the offeror.

The contractor's coefficient is based on cost elements such as overhead, profit, minimum design costs, G&A expenses, bond premiums, and gross receipt taxes.

These contracts have much of their pricing determined by pre-award competition.

It is possible that the use of multiple awards for these contracts could result in higher overall prices to the government because Offerors might be inclined to raise their bidding coefficients to account for the fact that potential delivery orders would be spread out among several firms, which means that the companies would have fewer tasks over which to spread their overhead. (See Table 1 for the quantifiable impact).

According to the Job Order Contracting Performance 2015 Industry Survey, the average administrative cost savings realized by owners using a JOC compared to traditional contracting methods was 24%. These costs relate to procurement, design construction, and post construction. In addition to pre-award cost and schedule expenses in traditional contracting methods, quality and performance after award may be reduced when contractors desire to maximize their profit on a single contract opportunity. There are risks in terms of successfully awarding quality stand-alone contracts for last minute SRM projects in the fourth quarter of each fiscal year. Use of a stand-alone “C” contract does not allow flexibility required for end of the year small project execution. Often, these minor renovation or repair projects are identified and are required to be executed within 30 days of project identification. The use of a stand-alone C contract requires specifications creation and editing, market research, cost estimating, and engineering to facilitate the creation of the RFP. This process takes over 60 days and must be completed prior to issuance to the small business contractor making the utilization of this contract vehicle inappropriate for many of the projects.

Locating small business contractors willing to perform work for small dollar value projects can also be time consuming and result in receipt of a single bid.

(iv) Terms and Conditions: It is not anticipated that the Government will secure better terms or conditions by selecting this alternative.

b. Alternative 2: Multiple Award Task Order Contract (MATOC): An alternative approach is to procure the requirements through the use of a MATOC task order.

(i) Quality and Schedule: MATOC contracts provide an acquisition vehicle that allows the Government to complete numerous minor repair, maintenance and construction projects with a single, competitively awarded contract at a minimum cost through competition limited to the MATOC Pool. Request for Proposal (RFP) responses are received much quicker than those associated with traditional contracting methods because competition is restricted to those contractors in the pool. Quality is also very good since the contractor is motivated to obtain more orders by providing timely, responsive, high-quality work. When the project proposal and the proposed schedule is received, the project manager will ensure that the contractor's performance schedule is realistic and meets the requirements of the job order.

(ii) Acquisition Cycle: The acquisition cycle times needed to solicit and award a base contract is the same for Alternative 1 and 2, apart from awarding multiple contracts versus one. Thus, the overall cycle time would not be offset by using a MATOC. MATOC task orders generally require a minimum of 90 days to issue.

(iii) Cost: A MATOC task order requires use of a USACE Design Manager, USACE Project Manager, Contract Specialist, Contracting Officer, and many PDT members to develop scopes of work, handle funding, prepare documentation and negotiate and award task orders. JOCs, in contrast are designed to minimize the amount of personnel required to award a task order, thus requiring less customer funding to award the small dollar value projects. JOC task orders use an appointed Ordering Officer who is responsible for all administrative functions of the JOC contract. The Ordering Officer, within their authority, can plan and order new JOC task orders and involve a fraction of the required PDT members on a MATOC task order. (See Table 1 for the quantifiable impact).

(iv) Terms and Conditions: It is not anticipated that the Government will secure better terms or conditions by selecting this alternative.

c. Alternative 3: Job Order Contracting (JOC) (Recommended):

(i) Quality and Schedule: JOC contracts provide an acquisition vehicle that allows the Government to complete numerous minor repair, maintenance and construction projects with a single, competitively awarded contract at a minimum cost. The Government and contractor develop scopes of work jointly, resolving uncertainties at scoping meetings and eliminating the time and expense of the normal project Architect Engineering (A-E) design-bid-construct/build cycle.

Request for Proposal (RFP) responses are received much quicker than those associated with traditional contracting methods and awards can be made in a matter of days compared to three weeks to three months. Quality is also very good since the contractor is motivated to obtain more orders by providing timely, responsive, high-quality work.

(ii) Acquisition Cycle: Although lead time to award a JOC contract is the same as other contracts, JOC orders can start much more quickly once the contract has been awarded. The UPB adds value in streamlining the process in developing the government or the cost proposals. JOC orders don't require a mandatory 15-day synopsis or a 30-day proposal preparation period. RFP response times generally range from three to ten days with award shortly thereafter. This is a valuable mission consideration at year-end when funds become available on short notice and standalone contracts are at risk for timely award.

(iii) Cost: JOC contractors do not have to compete for each project, spending time and money preparing proposals for projects they may not win, although the government still has the right not to award the contract.

These savings could be passed on to the Government in the form of lower proposed prices since the contractor can spread overhead over more projects. Project price is negotiated and is determined from regionalized pre-set unit prices for construction tasks (i.e., this contract would use the R.S. Means Facilities price book with the CCI for Monterey and San Miguel, CA multiplied by quantities and competitively bid adjustment factors (i.e., coefficients) and the quantities of said tasks along with quantities of materials. Furthermore, design costs can be reduced or eliminated because design documentation in JOC is less formal and much less costly than having an A-E prepare bid documents.

Benefits: The ability to work with a single contractor directly through JOC provides significant advantages in comparison to awarding multiple small business “C” type contracts where various contractors may be utilized. Fort Worth District and other districts experienced that the iterative process of negotiating and executing repair and construction efforts with a single contractor generates greater understanding between contractor and Government, resulting in more thorough proposals and quality projects. While stand alone “C” type contract competitions give the Government the opportunity to avail itself of a wider range of potential contractors for each project. Market Research achieves essentially the same result for task orders under the proposed JOC – a high quality and familiar contractor that is suited for the requirements. Furthermore, the iterative process of working with one contractor under a JOC tends to generate a more thorough shared understanding between the contractor and Government for the Government's requirements, and the installation's and facilities' procedures. While the potential exists for the small business JOC holder to end up being a poor performer, due diligence by the Government at the outset makes this risk highly unlikely, potentially resulting in a “good to great” contractor for every project. In addition, the unlikely event that the small business JOC contractor does not perform well, the Government can quickly pursue another small business JOC contractor or avail itself of other contract vehicles.

Risks: The risk with a JOC as with any other type of contract, is if the contractor is unable to perform to adequate standards or defaults due to bankruptcy. The risk is mitigated with four, one year ordering options. This encourages the contractor to perform at an acceptable level to continue to receive a steady income over a five-year period, or potentially results in losing the remaining value of the contract for the outstanding period of performance.

(iv) Quantifiable Impact:

Given the 150 projects anticipated in the workload during FY24 - FY28, the extrapolated total cost per alternative is included above. The JOC approach provided in Alternative 3 provides over $28,788,375 in administrative cost savings over Alternative 1 over the life of the Contract and its expected 150 Contract Actions. Alternative 2 provides $22,027,500 in cost savings over the life of the Contract assuming 150 Contract Actions.

Alternative 3 is 71.6% cheaper than Alternative 1 and is 23.5% cheaper than Alternative 2.

Table 2: Cumulative Cost/Hours, by Alternative, for 150 projects:

Alt2: ID/IQ

MATOC

Alt1: Stand-Alone “C” Type Contract

Alt3: JOC Task Order

#Hrs Cost #Hrs Cost #Hrs Cost

37900

18,166,500

84400

$40,194,000

67650

28,788,3

Table 3: Summary of Alternatives

Alternative 1 Advantages Disadvantages

No

Consolidation –

Stand Alone

“P” or “C” Type

Contracts

• Allows an increased number of small business firms the opportunity to propose on more Government projects.

• No contract value or time limits to impact the project

• Stand-alone projects do not realize the fiscal efficiency that are gained by consolidating projects, as shown by Table 1, above.

• Preparation and approval of the Consolidation memo could impact schedule

• Contractors may have a lack of understanding of POM and USACE procedures

• One award per project

• Workload in fourth quarter does not provide adequate review and oversight time

Alternative 2 Advantages Disadvantages

Alternative 2: ID/IQ

MATOC

• Allows an increased number of small business firms the opportunity to propose on more Government projects.

• Longer acquisition cycle for both the contract and task order

• Higher acquisition costs for the contract

• Limited competition at the task order level

Alternative 3 Advantages Disadvantages

Job Order Contract

(JOC)

Base Contract

• Acquisition and ordering costs are substantially less.

• Expedited issuance of orders.

• Minimal PDT involvement.

• Streamlined process.

• Responsive support

• Reduced project and/or deferred maintenance backlog

• More funds applied to construction vs procurement

• Dependable, long-term owner- contractor relationships

• Reduced or eliminated claims

• Reduced or eliminated change orders

• Greater cost visualization and control

• Easier project deployment/management

• Longer acquisition cycle for the base contract.

• Lower acquisition costs.

• Lack of competition at the Task Order level.

• Potential default for cause with no additional contractors to perform the remaining work.

4. Bundling:

a. FAR 2.101(b) defines bundling as consolidating two or more requirements for supplies or services, previously provided or performed under separate small contracts, into a solicitation for a single contract that is likely to be unsuitable for award to a small business concern due to -

(i) The diversity, size, or specialized nature of the elements of the performance specified;

(ii) The aggregate dollar value of the anticipated award;

(iii) The geographical dispersion of the contract performance sites; or

(iv) Any combination of the factors described in paragraphs (1)(i), (ii) and (iii) of this definition."

b. FAR 2.101 defines "separate small contract" as a contract that has been performed by one or more small business concerns or that was suitable for award to one or more small business concerns.

The proposed strategy does not constitute bundling because the contracts are suitable for award to small business and will be specifically set aside for small business.

The Competition in Contracting Act (CICA) requires solicitations to provide for full and open competition except where restrictions on competition are necessary to satisfy the procuring agency's needs. In such a case, restrictions on competition are allowed but only to the extent necessary to satisfy the agency's needs. Bundled procurements combine separate requirements into one contract; thus, they have the potential to restrict competition in violation of CICA by excluding firms that can provide only a portion of the bundled requirement. However, substantial cost savings achieved through the reduction of duplicative efforts and operational efficiency can be a reasonable basis for restricting competition where requirements are bundled. Here, there is no CICA bundling because small businesses are not being excluded by combining the requirements. In fact, all of the contract capacity will be set aside for 8(a) small businesses. Moreover, the savings and efficiencies that are anticipated to be achieved through this acquisition justify any restriction on competition presented by the consolidated requirement, which involves the least amount of consolidation necessary to execute the mission.

5. Considerations, facts, reasoning supporting the determination: There are no additional considerations, facts, or reasons not covered elsewhere in this determination.

The Small Business Administration Procurement Center Representative (SBA PCR) and the SPK Deputy, Office of Small Business Programs (OSBP) both concur with the proposed approach for this procurement and the DD2579 will be signed by the Contracting Officer, SPK Deputy, Office of Small Business programs and the SBA PCR.

6. Summary: The acquisition of the contemplated JOC provides the best manner in which to support the requirements of POM and represents the most cost effective and time efficient approach. By consolidating, the government will realize quality improvements that will save time and improve efficiency while receiving a reduction in acquisition cycle time, as described in FAR 7.107-2(c), because a single contractor will perform the somewhat repetitive tasks creating a streamlined acquisition process. In addition to the cost savings that will be achieved because the Government will not need to pay mobilization and demobilization costs for each Task Order and the contractor's administrative cost for gaining base access for a short duration, the proposed consolidation provides greater than the requisite 10% savings in administrative costs to the Government, per FAR 7.107-2(d)(1)(i), demonstrates an appropriate balance of mission and savings, and provides a JOC alternative, the benefits of which far outweigh the benefits of the other proposed alternatives. Additionally, consolidation is necessary, per FAR 7.107-2(e)(1), because the JOC is critical to the agency's mission success by providing fast and timely delivery on critically needed projects; and it provides for maximum participation by small business since it is being set-aside for small businesses.

ATTACHMENTS:

1. COE JOC Request and MIPR (March 2022)

2. Feasibility Report (March 2022)

3. Projected Project List

COORDINATION PAGE

NATALIA GOMEZ

Contract Specialist Sacramento District

MICHELLE SPENCE

Contracting Officer

Jesus L. Ortiz Military Technical Lead

Richard L. Wells Chief, Military Design Branch

Michelle D. Morales Deputy for Small Business Programs l2edmmeh Text Box Maribeth Haynes, R.A.

Acting Chief, Military Design Branch

Acting Deputy District Counsel for Military Programs

DEPARTMENT OF THE ARMY

US ARMY CORPS OF ENGINEERS (USACE)

SOUTH PACIFIC DIVISION (SPD)

SACRAMENTO DISTRICT (SPK)

CONSOLIDATION MEMORANDUM

INDEFINITE DELIVERY/INDEFINITE QUANTITY (IDIQ)

JOB ORDER CONTRACT (JOC)

PRESIDIO OF MONTEREY (POM), CALIFORNIA

Determination

The acquisition of the contemplated consolidated JOC provides the best manner in which to support the requirements of POM. By consolidating, the government will realize quality improvements that will save time and improve efficiency while receiving a reduction in acquisition cycle time, as described in FAR 7.107-2(c). This is because a single contractor will perform the somewhat repetitive tasks creating a streamlined acquisition process. The proposed consolidation provides greater than the requisite 10% savings in administrative costs to the Government, per FAR 7.107-2(d)(1)(i), demonstrates an appropriate balance of mission and savings, and provides the best JOC alternative. The consolidated JOC alternative’s benefits far outweigh the benefits of the other proposed alternatives. Additionally, consolidation is necessary, per FAR 7.107-2(e)(1), because the JOC is critical to the agency’s mission success by providing fast and timely delivery on critically needed projects at all locations maintained by POM; and it provides for maximum participation by small businesses since it is being set aside for small businesses.

R. Colette Carrizales

Chief of the Contracting Office