Logical_Follow-On_Justification_I-15_signed.pdf

DEPARTMENT OF TRANSPORTATION

FEDERAL HIGHWAY ADMINISTRATION

JUSTIFICATION FOR AN EXCEPTION TO FAIR OPPORTUNITY

Contract Number: DTFH61-12-D-00026 Task Order Number: 0212 Modification Number: 0001

1. Identification of the agency and the contracting activity.

Federal Highway Administration Headquarters, Office of Acquisition and Grants Management, 1200 New Jersey Avenue, S.E., E65-101, Washington, DC 20590.

2. Nature and/or description of the action being approved.

This is a justification for an exception to fair opportunity, for a modification to raise the ceiling of the subject task order. The task order is to provide legal advisory services to the Government for the “I-15 Tolled Express Lanes Corridor Improvement Project,” a prospective loan under the Transportation Infrastructure Finance and Innovation Act (TIFIA) for a project that will construct improvements to a section of highway in Riverside County, California.

3. Description of the supplies or services required to meet the agency’s needs (including the estimated value).

The additional services required consist of legal services, specifically continuation of the “negotiation” tasking described in the task order. The estimated value of the additional services is $225,000, to increase the total value of the task order from $297,635 to $522,635.

The period of performance for the task order is through October 31, 2017.

4. Identification of the exception to fair opportunity and the supporting rationale.

The exception to fair opportunity is that cited at FAR 16.505(b)(2)(i)(C): “The order must be issued on a sole-source basis in the interest of economy and efficiency because it is a logical follow-on to an order already issued under the contract, provided that all awardees were given a fair opportunity to be considered for the original order.”

Rationale: This modification is a logical follow-on to the base task order, because it is to continue legal services connected to ongoing negotiations between the Government and other parties, in connection with the “I-15 Tolled Express Lanes Corridor Improvement Project,” TIFIA loan. The scope of work remains identical to that of the base task order; however, a ceiling increase is necessary because the extent and duration of the negotiations required to complete the work effort are at this point estimated to substantially exceed that initially anticipated under the task order.

Additional unanticipated effort was and will be required due to the following:

1. The Contractor has devoted significantly more time than anticipated in their proposal to preparing, discussing and revising a list of key business issues for the TIFIA Loan Agreement and the related indenture. The Contractor’s estimate for this work element was based on their past experience with similar TIFIA transactions and was reasonable; the additional time was required based on the needs of the Government in this instance.

2. Despite the time, attention and care spent on the business issues list, the borrower and the Government have continued to have differing interpretations of how certain topics included in the issues list are to be resolved. Because of the negotiation dynamics, the level of effort required to finalize the TIFIA Loan Agreement and of the Indenture exceeds what the Contractor reasonably anticipated at the time of their proposal.

3. The Contractor has unavoidably spent more time and attention than anticipated in reviewing and marking up the toll revenue bond indenture due to reasons beyond the control of the Government and the Contractor.

4. There have been significantly more internal and external conference calls than traditionally has been the case in TIFIA loan transactions. The amount of time dedicated to these calls exceeded the Contractor’s expectations in their proposal, which were reasonable based on their past experience and the information provided in the TOPR.

The ceiling increase is necessary to enable the Contractor to complete the work associated with the labor hour task area, as described above. At this point, it would be extremely disadvantageous to the Government to hold a new competitive procurement for a legal advisor to complete the remaining work. It is in the interest of economy and efficiency for the same Contractor to complete the negotiations work under this task order; introducing another Contractor to the effort would have a detrimental effect from an economy and efficiency perspective. The Contractor has an intimate knowledge of the history and scope of the negotiation process and all of the documentation related to this transaction (including the key issues list term sheet process, which is instrumental in the documentation of the Bond Resolution and the TIFIA loan agreement) and all of the documentation related to this transaction, including the initial drafts of the loan agreements and ancillary documents listed above, and all of the diligence document regarding the borrower and the transaction structure. The Contractor’s knowledge of the commercial agreements made (and not made) in principal and not yet documented is essential in properly documenting the transaction and ensuring the Government’s interests are adequately protected and accurately documented.

All awardees were given a fair opportunity to be considered for the original order.

5. Determination by the Contracting Officer that the anticipated cost to the Government will be fair and reasonable.

The anticipated cost to the Government for this modification, $225,000 is considered fair and reasonable. This modification impacts the labor-hour component of the task order, and the anticipated cost corresponds to an expected increase in labor-hours (in various categories) multiplied by the labor rates in effect under the task order. These labor rates were approved at time of award as fair and reasonable. The proposed/accepted labor rates were achieved in a highly competitive environment—all seven awardees under the set of Indefinite Delivery, Indefinite Quantity (IDIQ) contracts were given a fair opportunity to compete.

6. Any other facts supporting the justification.

There are no other relevant facts supporting the justification, not otherwise included above.

7. A statement of the actions, if any, the agency may take to remove or overcome any barriers that led to the exception to fair opportunity before any subsequent acquisition for the supplies or services is made.

For subsequent acquisitions of legal advisory services under this set of IDIQ contracts, the Agency may consider providing ranges of labor hours as an advisory to the offerors, for the negotiations tasking. Experience has revealed that the nature of the negotiations work is often more protracted than initially expected/proposed by the contractors. Considering special factors (complexity, political sensitivity) that might warrant higher initial estimates/award ceilings would lessen the need for subsequent modifications using this logical follow-on justification. Additionally, in the future, the Government may consider the use of optional line items to allow for pricing of situations that might arise, such as the need for negotiations beyond the initially-anticipated period of performance end date.

8. The Contracting Officer’s certification that the justification is accurate and complete to the best of the contracting officer’s knowledge and belief.

Certification: ____________________________________________________________

Samantha Reizes, Contracting Officer Date

9. Evidence that any supporting data that is the responsibility of technical or requirements personnel (e.g., verifying the Government’s minimum needs or requirements or other rationale for an exception to fair opportunity) and which form a basis for the justification have been certified as complete and accurate by the technical or requirements personnel.

Certification: ____________________________________________________________

Jessica Pettrone, Contracting Officer’s Representative Date

DETERMINATION

Based on the foregoing information, I hereby determine that the circumstances in FAR 16.505(b)(2)(i)(C) applies to the subject modification.

Samantha Reizes Date Contracting Officer Office of Acquisition and Grants Management Federal Highway Administration

APPROVAL

Pursuant to FAR 16.505(b)(2)(ii)(C), the ordering activity contracting officer’s certification that the justification is accurate and complete to the best of the ordering activity contracting officer’s knowledge and belief will serve as approval. No higher approval level is established in accordance with agency procedures. Therefore, see section (8) of this justification, above.