S_A12_nat_gas_transport_JOFOC_Signed.pdf

JUNITED STATES DEPARTMENT OF JUSTICE

FEDERAL BUREAU OF PRISONS

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

Natural Gas Local Distribution Company Utility Services FCI Fairton

Pursuant to the Federal Acquisition Regulation (FAR) Part 6.302-1 (a) and 6.302-1 (b)(3), and the Bureau of Prisons Acquisition Policy (BPAP) 4100.05 Subpart 6.304 (b), the Federal Bureau of Prisons (BOP) has determined that the procurement of natural gas local distribution company utility services for the Federal Correctional Institution Fairton located near Fairton, New Jersey, meets the criteria established for other than full and open competition. It is further determined that only one responsible source and no other supplies and/or services will satisfy agency requirements. This limitation on competition is justified as supported by the following information:

1. IDENTIFICATION OF THE AGENCY AND THE CONTRACTING ACTIVITY:

United States Department of Justice Federal Bureau of Prisons Federal Correctional Institution Fairton 655 Fairton-Millville Rd Fairton, NJ 08320

2. NATURE and/or DESCRIPTION OF ACTION BEING APPROVED:

This action is for the acquisition of natural gas local distribution company (LDC) utility service provided to the FCI Fairton, from the sole provider of such services in the Fairton, New Jersey, area. The FBOP, a component of the Department of Justice (DOJ) has a preceding, current, and continuing requirement for natural gas LDC utility service for the proper operation of the facility in order to provide a safe, secure environment to confine offenders and protect the public. The FBOP, Field Acquisition Office working to satisfy the acquisition needs of the FCI Fairton, intends to make a single award to the contractor who shall provide natural gas LDC utility services upon request by the institution. The pricing includes all associated charges to the government for providing the services required

(e.g., insurance, overhead, minimum wages, planning, etc.). The quantity of supplies/services to be provided by the contractor is estimated. These estimates are not a representation to a offorer or contractor that the estimated quantities will be required or ordered, or that conditions affecting requirements will remain stable or normal. General information regarding the FBOP and its facilities is located at www.bop.gov.

3. DESCRIPTION OF SERVICES REQUIRED TO MEET THE AGENCY NEEDS:

Pursuant to FAR Part 41.202, the South Jersey Gas Company (SJGC) continues to provide the “entire natural gas LDC utility service” (i.e., distribution, transportation, conveyance, system operation and maintenance, metering, billing, etc.). SJGC shall provide to the government facility at FCI Fairton, natural gas LDC utility services in a manner and form that is consistent with all applicable laws, rules, codes, industry standards, permits, and regulations, promulgated by any and all governmental authorities having jurisdiction. The http://www.bop.gov/

SJGC shall provide services on an uninterruptible daily basis 365 days per year. SJGC will be responsible to maintain and/or repair all associated pipelines and equipment, including associated costs for such repair, up to the delivery point or meter of FCI Fairton. SJGC will be responsible to ensure that the pipelines and associated equipment, utilized to provide natural gas LDC services will be maintained and operated in compliance with all rules and regulations set by the States of New Jersey Board of Public Utilities, in accordance with all Federal, State, County, and local government for a safe and secure natural gas LDC utility service.

The service required is natural gas local distribution company utility service from December 1, 2016, through September 30, 2017, subject to funds availability (FAR Clause 52.232-18.

The estimated average monthly cost for the LDC natural gas utility service is $14,900. The total estimated amount for the 10 month period is $149,000.

Contract Line Item Number Performance Period Estimated Annual Cost ($)

CLIN 0001 December 2016 through September 2017 $149,000.00

Total Estimated Cost: $149,000.00

4. AN IDENTIFICATION OF THE STATUTORY AUTHORITY PERMITTING

OTHER THAN FULL AND OPEN COMPETITION:

The statutory authority for this action is found at 41 U.S.C. 3304(a)(1). The exception which permits use of the cited statutory authority is stated at FAR 6.302-1, only one responsible source and no other supplies or services will satisfy agency requirements. When the supplies or services required by the agency are available from only one responsible source.

The application which permits use of the cited statutory authority are stated at FAR Part

6.302-1(b)(3), “When acquiring utility services (see 41.101), circumstances may dictate that only one supplier can furnish the service (see 41.202). Only one responsible source & no other supplies or services will satisfy agency requirements.” Analysis of the market indicates that the SJGC has proprietary rights up to the meter at FCI Fairton. In order for another provider to be capable of providing the service, significant capital improvements would be needed. The Bureau would be required to pay for the capital improvements, but it would not recover the costs of duplication of services, connection fees and infrastructure installation costs through competition. The current requirement is for follow-on services and does not include funding for capital improvements.

5. A DEMONSTRATION THAT THE PROPOSED CONTRACTOR’S UNIQUE

QUALIFICATIONS OR THE NATURE OF THE ACQUISITION REQUIRES USE

OF THE AUTHORITY CITED:

It is the policy of the Federal Government to obtain utility service from sources which are most advantageous to the Government in terms of economy, efficiency, reliability, and/or service. SJGC is the sole provider of natural gas LDC utility service in the FCI Fairton service area. SJGC is a private entity in the State of New Jersey, the only agent authorized by rules and regulations to provide natural gas LDC utility service in the Fairton area.

Having a single supplier of natural gas LDC utility service for this area is the most efficient method of providing natural gas. The New Jersey Board of Public Utilities (NJBPU) is the administrative agency charged under new Jersey law with the supervision and control over all public utilities in the state. The NJBPU has regulatory authority with statutory mandate to ensure natural gas is provided at reasonable rates. To this end, SJGC is designated by the NJBPU to be the local distribution company and related services within the protected franchise territory of Fairton, New Jersey. The rates SJGC is permitted to charge is regulated by the NJBPU.

6. A DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY SOURCES AS IS PRACTICABLE, INCLUDING

WHETHER OR NOT A NOTICE WAS OR WILL BE PUBLICIZED A REQUIRED

IN FAR PART 5.2:

As stated in FAR Part 5.202, Exceptions to transmitting a notice to the Government Point of

Entry(GPE) at (a)(5), the contracting officer need not submit a notice when “the proposed contract action is for utility services other than telecommunications services and only one source is available.” There are no General Services Administration (GSA) area-wide or single point contracts for natural gas LDC utility service in the FCI Fairton area at this time.

This contracting officer has determined, in accordance with FAR 5.202(a)(5), that this requirement appears to be a non-competitive market and the contracting officer need not submit a notice of, nor the issuance of, the RFQ to the GPE.

7. A DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND

REASONABLE:

The estimated average monthly cost, which was based on invoice history, for the natural gas LDC utility service is $14,900.00 with a total estimated usage for a 10 month period of $149,000.00. Utility rates are approved by the NJBPU. The SJGC, which is charged under State of New Jersey law to ensure that rates be just and reasonable. The State of New Jersey and SJGC websites have provided sufficient data to the FBOP contracting officer, pursuant to FAR 15.402, Pricing Policy, allowing the ability to make a preliminary determination that such anticipated costs appear to be fair and reasonable. All rates, rules and regulations of the SJGC are subject to the approval of the NJBPU. A formal decision in the form of periodic rulings, reviews, or similar actions of a governmental body, or embodied in the laws, are sufficient to set pricing (see FAR 15.403-1[c][2]). The establishment of the current supply and delivery of services began when the original service connections were installed. As such, this Contracting Officer has determined the anticipated cost to the Government will be fair and reasonable.

8. A DESCRIPTION OF THE MARKET RESEARCH CONDUCTED:

This documentation is in accordance with FAR Part 10, which describes the policies and procedures for conducting market research in a process of finding viable sources of goods and services to meet government requirements and to find the most suitable approach to acquiring, distributing, and supporting supplies and services. The amount of market research will vary, depending on such factors as urgency, estimated dollar value, complexity, and past experience.

Market research involves obtaining information specific to the item being acquired. This report is submitted in support of an acquisition with an estimated value in excess of the simplified acquisition threshold. Below are the findings of the market research for the above referenced requirement.

I. BACKGROUND: A review of the obligation reveals the following – FCI Fairton has a current and continuing requirement for the purchase of natural gas LDC utility service for the continuation of normal operations of the institution in order to provide a safe, secure environment to confine offenders and protect the public.

1. Title: Natural Gas LDC Utility Service – FCI Fairton

2. Product or Service Code: S- Utilities and Housekeeping Services – S111 Gas Services

3. North American Industry Classification System (NAICS): 221210 Natural Gas

Distribution = this industry comprises (1) establishments primarily engaged in operating gas distribution systems (e.g., mains, meters); (2) establishments known as gas marketers that buy gas from the well and sell it to a distribution system; (3) establishments know as gas brokers or agents that arrange the sale of gas over gas distribution systems operated by others; and (4) establishments primarily engaged in transmitting and distributing gas to final consumers

4. Standard Industrial Classification (SIC) Code: 4924 Natural Gas Distribution

II. DELIVERY / PERFORMANCE: Purchase order to provide natural gas LDC utility services from December 1, 2016 through September 30, 2017. The SJGC shall provide to the government facility at FCI Fairton, natural gas LDC utility services in a manner and form that is consistent with all applicable laws, rules, codes, industry standards, permits, and regulations, promulgated by any and all governmental authorities having jurisdiction.

SJGC shall provide services on an uninterruptible daily basis 365 days per year. SJGC will be responsible to maintain and/or repair all associated natural gas LDC lines and equipment, including associated costs for such repair, from the delivery point or meter of

FCI Fairton. Pursuant to FAR Part 41.202, SJGC continues to provide the “entire natural gas LDC utility service” (i.e., transportation, distribution, system operation and maintenance, metering, billing, etc.).

III. POTENTIAL SOURCES: SJGC, Number One South Jersey Plaza, Route 54, Folsom, NJ

08037-9109

IV. MARKET ANALYSIS:

1. The results of market research have determined that the Government’s needs can be met by an item that is of a type customarily available in the commercial marketplace and is used by the general public.

2. The following methods were utilized to conduct Market Research:

X Reviewed historical acquisition information.

X Personal knowledge in procuring supplies/services of this type.

X Review of Government and/or commercial databases for relevant information.

X FedBizOpps Sources Sought Synopsis; Found no other interested party capable of providing natural gas LDC utility service.

X Searched database and contacted GSA Energy Center of Expertise; Found no areawide or single point contract is available.

X Searched FPDS-NG; Found GSA, VA, and the FBOP are purchasing natural gas

LDC service from the SJGC.

X Searched previous purchases of similar/identical acquisitions; Found the SJGC is current provider to FCI Fairton. This is a continuation of service.

X Reviewing results of recent market research undertaken to meet similar or identical requirments.

X Contacting knowledgeable individuals in Government and Industry regarding market capabilities to meet requirements.

3. Results: Results of Market Research were as follows: Only on source could be found.

A Justification for Other than Full and Open Competition is provided for approval.

V. RECOMMENDATION: The market research conducted by the contracting office and the Facilities Department staff determined that a GSA area-wide nor a single point contract with SJGC is available in accordance with Title 31 USC § 1535. GSA is specifically authorized by law and regulation to purchase utility services on behalf of other agencies by providing an Assisted Acquisition. August 2010, in accordance with

Title 40 USC § 121(d), GSA issued the FBOP a Delegation of Authority for nationwide authority to negotiate and execute utility service contracts at Federal facilities under the control and direction of the FBOP in accordance with Title 40 USC § 501(b)(1)(B).

Search of previous purchases of similar/identical acquisitions shows the SJGC is the current natural gas LDC service provider for FCI Fairton and has serviced the facility since dedication. Also, SJGC is the only service supplier capable at this time of providing FCI Fairton with natural gas LDC services. No other company or municipality has presented itself with the capabilities or the infrastructure to run natural gas LDC lines to the current connection site. The amount compensated for the construction of the natural gas LDC infrastructure systems currently being used at FCI Fairton is not available. No other sources have been located that are currently capable or that could acquire the capability of meeting the Bureau’s requirement.

1. It is this Contracting Officers determination there is a source available that is capable of providing the required services. The requirement will be awarded to SJGC as a single award of a firm-fixed price requirements type natural gas LDC utility purchase order utilizing FAR Part 6, 12, 13, and 41. A Performance-Based Acquisition method will not be used for this procurement as it is determined not applicable. A PBA relies on the use of measurable performance standards and financial incentives in a competitive environment to encourage competitors to develop and institute innovative and cost-effective methods of performing the work.

2. SJGC Natural gas LDC is the sole provider of natural gas LDC utility service in the FCI

Fairton service area. The NJBPU is the independent governing body that approves all rates with the responsibility of natural gas LDC services for the locale in which FCI

Fairton resides. I applied personal knowledge, interaction with knowledgeable individuals in local and Federal Government regarding market capabilities to meet the requirements, and research of generally accessible literature available on-line were the techniques used in researching this procurement for a supply/services of this type.

During construction of the institution, one contract was awarded for the installation and operation of one natural gas LDC pipeline leading to and from the institution. A review of State of New Jersey regulations determined that a natural gas LDC utility service is not a deregulated utility. Deregulation would promote competition.

SJGC is other than small business.

3. This requirement will not be posted to Fedbizopps to promote competition, broaden industry participation, and assist small business concerns in obtaining contracts for FCI

Fairton. This requirement meets the exemption at FAR 5.202(5) the proposed contract action is for utility services other than telecommunications services and only one source is available. SJGC is an entity in the City, the only agent authorized by rules and regulations to provide natural gas LDC service in the Fairton area. Having a single supplier of natural gas LDC service for this area is the most efficient method of providing and distributing potable natural gas LDC service.

4. Search of previous purchases of similar/identical acquisitions shows the SJGC is the current natural gas LDC service provider for FCI Fairton and has serviced the facility since dedication. Also, SJGC is the only service supplier capable at this time of providing FCI Fairton with natural gas LDC services. No other company has presented itself with the capabilities nor the infrastructure to run natural gas LDC lines to the current connection site. No other sources have been located that are currently capable or that could acquire the capability of meeting the Bureau’s requirement. The

Bureau does not have the state and local approval or the resources to provide the funding for another company to install a new natural gas LDC system at the institution, other pipelines are not available, and no other contractor can provide natural gas LDC service through the SJGC pipelines.

5. The U.S. General Services Administration has issued a Delegation of Contracting

Authority to the U.S. Department of Justice, Federal Bureau of Prisons to negotiate and execute utility service contracts. This includes the provision of natural gas LDC service for FCI Fairton.

6. I also make the determination that this procurement action “NOT” be set-aside for small business.

COMMENTS: The Government contemplates the single award of a firm-fixed price requirements type natural gas LDC utility service purchase order resulting from this requirement. The conclusions from this market research will be incorporated into the document for providing Natural gas LDC Utility Service for FCI Fairton.

9. OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN

COMPETITION:

There are no other facts which would support the use of other than full and open competition.

10. A LISTING OF THE SOURCES, IF ANY, THAT EXPRESSED, IN WRITING, AN

INTEREST IN THE ACQUISITION:

There were no other sources which expressed an interest in this acquisition or that would be able to provide the service to meet the minimum requirements of the government.

11. A STATEMENT OF ACTIONS, IF ANY, THE AGENCY MAY TAKE TO

REMOVE OR OVERCOME ANY BARRIERS TO COMPETITION BEFORE ANY

SUBSEQUENT ACQUISITION FOR THE SUPPLIES OR SERVICES REQUIRED:

Contracting and requirement staff continue to conduct appropriate market research to determine if sources capable of satisfying the agency’s requirement exist and to overcome competition barriers. Deregulation laws are presently nonexistent and no alternative source of service is currently available. A review of government procurement databases shows only the FBOP and GSA are issuing orders to the SJGC for natural gas LDC utility requirements. FCI Fairton is a consumer of services from the public utility. If another potential source emerges, the agency will assess whether competition for future requirements is feasible. FCI Fairton will continue to monitor the trends in the utility industry to see if competition or sources that may be able to meet the minimum needs of the government and its utility requirements. Should opportunities arise in the future FCI Fairton will take appropriate action.

12. Contracting Officer’s Certification:

I hereby certify that this request for Justification and Approval of other than Full and Open Competition is made in good faith, the supporting data and information are accurate and complete to the best of my knowledge and belief, and that I would not be making this request if it were feasible to fully compete this requirement. I further certify that this request is not the result of lack of advance planning or a desire to expend funds while those funds are still available.

Approved:

Dennis Dempsey, Contract Specialist Date Field Acquisition Office

//S// 12/05/2016