DF No. 0222-25-029-00_Redacted.pdf

D&F No: 0222-25-029-00.1

DETERMINATION AND FINDINGS

AUTHORITY TO CONSOLIDATE CONTRACT REQUIREMENTS

Upon the basis of the following findings pursuant to the authority of 15 U.S.C. § 657q, as implemented in Federal Acquisition Regulation (FAR) Subpart 7.107-2 and the Navy Marine Corps Acquisition Regulation Supplement (NMCARS) Subpart 5207.107-2, it is hereby determined that the Naval Sea Systems Command (NAVSEA), Naval Surface Warfare Center, Philadelphia Division (NSWCPD) engineering support services of Steam And Auxiliary Controls Engineering Services Support requirements may be consolidated.

FINDINGS

1. Identification of Requiring Agency and Contracting Activity

This Determination and Findings has been prepared by the NSWCPD, a contracting activity under the authority of Naval Sea Systems Command (NAVSEA).

2. Nature/Description of Action

NSWCPD is planning to issue a single solicitation for engineering support services of Steam and Auxiliary Controls Engineering Services Support. This requirement will provide engineering services for upgrading Hull Mechanical & Electrical (HM&E) systems and deploying technologies, which improve availability, increase reliability, ship mission readiness, and decrease maintenance and workload requirements for machinery systems and components. These services are critical to NSWCPD Department 50 Codes 544, 545, and 546, as the principal provider for life cycle management and full spectrum engineering support with the technical rigor and focus on process for cyber secure surface ship auxiliary, fluid, and ventilation control systems and submarine propulsion and auxiliary control systems. This procurement action will consolidate these requirements which had been previously contracted separately by two (2) Contractors, NDI Engineering Company (NDI) and Noblis MSD, LLC (Noblis) under three separate Task Orders as detailed below.

a. Fluid Systems Automation

On 14 April 2020, Task Order No. N6449820F3004 (Period of Performance: 5 Years) competitively awarded under a SeaPort-NxG Small Business set-aside to NDI Engineering Company under Contract No. N0017819D8168 ( ) to provide engineering, technical, programmatic, logistics, maintenances, ship installation/alternations, and life cycle management support for the U.S. Navy Auxiliary, Fluid, and Machinery Control Systems.

DEPARTMENT OF THE NAVY

NAVAL SURFACE WARFARE CENTER

PHILADELPHIA DIVISION

5001 SOUTH BROAD STREET

PHILADELPHIA PA 19112-1403

IN REPLY REFER TO:

This Task Order expires on 31 December 2025. The intention is to award the new requirement by the end of the calendar year before the Period of Performance expires.

b. Technical and ISEA Support Services

On 23 September 2022, Task Order No. N6449822F3172 (Period of Performance: 3 Years) was competitively awarded as an unrestricted Task Order under Multiple Award Contract No. N6449821D4048 ( ) to Noblis MSD, LLC to provide technical and ISEA support services at NSWCPD and onboard U.S. Navy ships as required and engineering and programmatic efforts for the Fluid Control System on DDG class ships. This Task Order expires on 31 December 2025. The intention is to award the new requirement by the end of the calendar year before the Period of Performance expires.

c. Propulsion and Auxiliary Control System (PACS) and Ballast System Engineering

Support

On 27 September 2022, Task Order No. N6449822F3176 (Period of Performance: 3 Years) was competitively awarded as an unrestricted Task Order under Multiple Award Contract No. N6449821D4048 ( ) to Noblis MSD, LLC to provide program management, logistical services, various technical and ISEA support services, hardware & software development and cybersecurity support at NSWCPD and onboard U.S. Navy ships as required in support of engineering and programmatic efforts on LHD, ARDM and AFDL class ships/floating dry-docks for the following systems; Propulsion and Auxiliary Control System (PACS), Damage Control System (DCS), Ballast Control System (BCS), Fluid Control System (FCS), ADECS and AFDL Ballast System. This Task Order expires on 26 September 2025. There are currently adequate LOE hours remaining under this Task Order to continue support through the end of the calendar year. The intention is to award the new requirement by the end of the calendar year before the Period of Performance expires.

The combined value of all three Task Orders is . After consolidation, the combined efforts will have an estimated value of and will be competed as a Small Business Set- Aside under SeaPort-NxG with a period of performance of one (1) 12-month base period and four (4) 12-month option periods. The difference between the aggregated value of the prior three (3) Task Orders ( ) and the follow-on consolidated procurement value of can largely be accounted for by three primary cost drivers:

(1) The application of labor rate escalation from the mid-point of the above identified three historical task orders reflecting prevailing market conditions and competitive compensation trends necessary to retain and attract qualified personnel associated with the continuance of historical task order work during the follow-on task order period of performance. This cost driver accounts for approximately of the cost difference

(2) Increased level of effort and richer labor mix associated with requirement efforts that had been historically accomplished under the three task orders that are the subject to this consolidation action. In addition, the follow-on Task Order will include new requirements driven by the focus to modernizing HM&E systems, and the deployment of novel technologies to improve system availability, ship mission readiness, intended to decrease maintenance and workload requirements for machinery systems and components (growth). As the follow-on consolidated effort includes broader support for life cycle management and full spectrum engineering support with technical rigor and focus on process for cyber secure surface ship auxiliary, fluid, and ventilation control systems and submarine propulsion and auxiliary control systems, the expectation of a significant new work component is considered to be justified. The noted enhancements are essential to ensure the modernization of hardware & software development and cybersecurity support at NSWCPD and onboard U.S. Navy ships. This cost driver accounts for approximately of the cost difference ( ).

(3) Incorporated tasking from other existing Task Orders that are more aligned with the scope of this procurement to maximize efficiencies. This cost driver accounts for approximately of the cost difference ( ).

(4) The remaining delta is attributed to the incorporation of a Surge Option CLIN representing 10% of the total Level-of-Effort (LOE) hours estimated, intended to address “Wartime Readiness” unplanned tasking.

3. Results of Market Research

As discussed in detail below, market research indicates that there are two (2) Small Businesses that appear capable of providing the required services at fair market prices. In accordance with FAR 19.502-2(a), this requirement shall be set-aside for Small Businesses.

Market research was performed through a review of previous acquisitions for similar requirements and discussions with the requiring technical divisions.

In accordance with FAR Part 10, a determination has been made that Government’s need cannot be met by a type of service customarily available in the marketplace as they are not of a type offered and sold competitively in substantial quantities in the commercial marketplace based on established catalog or market prices for specific tasks performed under standard commercial terms and conditions. The DoD Commercial Item Database within PIEE was queried before making this non-commercial determination.

In 2022, when Task Order No. N6449822F3172 was competed as unrestricted, there were two (2) offers received in response to the solicitation, of which two (2) offers were found to be technically acceptable ( ).

c. Propulsion and Auxiliary Control System (PACS) and Ballast System Engineering

Support

In 2022, when Task Order No. N6449822F3176 was competed as unrestricted, there was one

(1) offer received in response to the solicitation, which was found to be technically acceptable ( ).

Small Business Impacts: NSWCPD has considered the potential impacts of this consolidation to Small Businesses. As noted above, market research indicates a reasonable expectation of obtaining offers from two (2) or more responsible Small Business concerns that are competitive in terms of fair market prices, quality, and delivery. Therefore, in accordance with FAR 19.502- 2(a), this requirement shall be set-aside for Small Businesses. Thus, in accordance with 15 U.S.C. § 657q(c)(1)(D) and FAR 7.107-2(a)(4), NSWCPD has found that this consolidation in-and-of-itself will ultimately have no negative impacts on contracting with Small Business concerns. This consolidation determination has received concurrence from NSWCPD’s Office of Small Business Programs (00K).

4. Benefits of Planned Consolidation

NSWCPD has determined that the consolidation of the three (3) previously awarded Task Order requirements into a single combined action provides substantial benefits to the Government. These benefits are both tangible to the Government in terms of efficiency and quantifiable in terms of favorable cost impact. The expected benefits in terms of quality, schedule, workforce, acquisition cycle time, and cost are critical to the NSWCPD Steam and Auxiliary Controls Branches’ ability to rapidly deliver quality Critical Steam and Auxiliary Controls System solutions that enhance warfighter capabilities. These benefits are as follows:

Quality and Schedule: Consolidating all activities associated with various Auxiliary, Steam, and Ventilation Engineering Services requirements into one SeaPort-NxG Task Order directly aligns with the NAVSEA and NSWCPD mission and will improve the quality of the end product. Consolidation will facilitate an increase in overall quality and timeliness of the Contractor’s delivered products, allowing one (1) Contractor to effectively integrate support services and adjust resources as necessary. Consolidation will also increase the quality and timeliness of services provided by having one (1) Task Order with standard terms and conditions, with one (1) Program Manager responsible for resultant Task Order performance.

Such efficiencies promote consistency and compliance with NSWCPD quality control processes and procedures. Furthermore, a single Contractor executing the requirement under a single Task Order encourages higher quality and consistent deliverables when compared to the potential of having two (2) Contractors executing related requirements under separate contracts.

A single Contractor, in concert with any Subcontractors, may be more invested in delivering higher quality support requirements. Further, consolidation encourages innovation with respect to integration across functional areas.

Ultimately, to solicit and award separate contracts or Task Orders for services that are very similar in scope is inefficient. This approach would lead to higher contract costs, slippage of milestones and schedules, and quality control redundancies. There would be duplicative actions such as quarterly program review support of Contract Data Requirements List (CDRL) and Data Item Descriptions (DID) deliverables, and management of the CDRLs and DIDs. The consolidation of these requirements will also reduce overlap leading to overall improvement of the delivery and quality of services.

Consolidation of the engineering support will increase the quality and timeliness of services provided by having one (1) SeaPort Task Order and enabling standard terms and conditions.

Consolidation will increase the quality of the services provided by:

Having one (1) SeaPort Task Order with standardized terms and conditions;

Having a single Procuring Contracting Officer (PCO), Contract Specialist, Contracting

Officer’s Representative (COR), and Contract Program Manager for the service performance; and

Promoting consistency and accountability in the execution of the SOW.

Consolidation of the three (3) Task Order requirements ensures that program management, engineering, technical, and logistic support to U.S. Navy HM&E systems, including auxiliary, fluid, and machinery control systems are managed under a single contract requirement. Such efficiencies promote consistency and compliance with Auxiliary, Steam, and Ventilation Engineering Services and Level 1 quality control processes and procedures. Having these requirements managed under one (1) contract requirement will significantly improve the quality of the Auxiliary, Steam, and Ventilation Engineering Services systems and will substantially benefit mission execution of the fleet and warfighter.

Workforce Benefits: The consolidation of the efforts will enable the Contractor to provide a better and more efficient service by leveraging the technical capabilities of its workforce.

Consolidating the required effort under a single SeaPort solicitation would provide an overall increase in workforce stability and provide consistent workforce expectations across staff supporting the effort. One (1) enterprise contract requirement is more beneficial than multiple similar contract requirements since there will be a specific point of contact for both the Government and Contractor.

Reduction in Acquisition Cycle Times: Duplication of processes and document requirements is a significant strain on acquisition productivity. The proposed consolidation drastically reduces the documentation required to acquire the services desired thereby reducing the technical, contractual, and administrative burden of conducting multiple simultaneous competitions. There is significant benefit in consolidating the Task Orders, as removal of duplicative acquisition steps (e.g., acquisition planning, solicitation, evaluation, negotiations, etc.) will compress the acquisition cycle time by at least one (1) year from the alternative acquisition strategies. This estimate is based on the average time to conduct a tradeoff competition combined with the average manpower required to evaluate multiple proposals for each competition. Consolidation reduces acquisition, Program Management, Contracts, and Legal manpower requirements.

Consolidating these requirements creates efficiencies through the reduction of Government pre-award solicitation development and proposal evaluation, as well as post-award monitoring, administration, and closeout.

Cost: Pursuing the proposed requirement consolidation would result in an estimated cost savings to the Government over a five (5) year period, as outlined below.

a. Source Selection: Each competitive SeaPort-NxG Task Order is estimated to cost to award. Reducing the number of orders from three (3) to one (1) is expected to lead to a reduction of in source selection costs.

b. Contract Administration: As of 19 December 2024, there have been two thirty (30) modifications issued over a two (2) year period under Contract No. N6449821D4048 Task Orders N6449822F3172 and N6449822F3176 or 75 modifications normalized over a five-year Period of Performance period. There have been 73 modifications over the five-year period under SeaPort-NxG Task Order No. N6449820F3004. If the current three Task Orders were to be maintained over the five-year follow-on period 148 modification or approximately 49 per Task Order would be expected to be executed.

o The elimination of two Task Orders would result in a total reduction in Task Order modifications of 98 (2 x 49). Assuming the cost to process a modification is , the associated reduction in administrative cost is .

o There would also be a reduction in additional support staff administration if the Task Orders were consolidated. With three (3) Task Orders in place, there is duplication of efforts for the COR, Quality Assurance, Security, and Defense Contract Audit Agency support. It is estimated that consolidation would result in approximately in additional administrative cost savings.

c. Program Management:

It is assumed each separate SeaPort Task Order would utilize at least one (1) full-time Program Manager II. Using the average estimated fully burdened labor rates for the next five (5) years for the Program Manager II ( ) at 1,912 hour per year, there would be additional costs to the Government of if two of the current three (3) Task Orders were eliminated as a result of the subject proposed consolidation.

As depicted above, favorable cost impacts are expected to be realized by consolidating these efforts, estimated at a total of in administrative costs over a five (5) year period.

Although these cost savings (approximately of the total estimated value of the consolidated contract requirements) would not alone qualify as “substantial” under FAR 7.107-2(d), they do represent a quantifiable benefit of the consolidated approach in addition to the substantial non-monetary benefits described above. Further, this consolidation strategy is considered to be critical to the agency’s mission success, in addition to providing maximum practicable participation by small business. The current three Task Order awards normalized over a five-year Period of Performance resulted in in Task Order awards to small business prime contractors (1 of 3 Task Orders). Due to the growth associated with the proposed consolidated procurement, and the fact that proposed consolidated effort will be competed as a SeaPort-NxG Small Business Set-Aside, the associated Task Order value to be awarded to a Small Business Prime Contractor is expected to increase to .

5. Alternate Acquisition Strategies

Prior to settling on the proposed acquisition strategy, NSWCPD considered an alternative contracting approach that would have involved a lesser degree of consolidation. The alternative approach considered was to maintain the status quo and continue issuing separate competitively awarded contracts for the Steam and Auxiliary Controls Engineering Services Support requirements. The previous task orders were solicited competitively, however only one of the three Task order procurements had been conducted as a small business set-aside. It is not practicable to continue to compete engineering support service efforts separately from each other. The execution of three (3) separate Task Order procurements presents overall cost inefficiencies and delays to the Government. Separate Government Furnished Property (GFP) tracking mechanisms for each contract requirement would be required for all GFP being handled by the resultant Prime Contractor(s) and its Subcontractor(s) (as applicable). Three (3) Task Orders will also affect and inhibit an easier, more cost-effective method of managing the multitude of GFP that is being refurbished under this effort. A consolidated contract will allow for one (1) team, consisting of a Prime and Subcontractor(s) (vice three (3) teams under three (3) contractual vehicles, to perform the work providing for a quicker turnaround on repaired items at a lower cost for the administrative management of the Subcontractor(s) and GFP.

Additionally, competing each engineering support services requirement separately would cause an undue delay, while consolidation allows for unification of requirements and streamlining of acquisition and technical efforts. Utilizing average timelines to compete the requirements separately along with the manpower needed for each competition. The same Government personnel would be required to process each competition separately. Thus, the competitions