EWTS JA Redacted.pdf

Justification and Approval (J&A) for Other Than Full and Open Competition

FOR OFFICIAL USE ONLY

March 2018 FOR OFFICIAL USE ONLY Page 3 of 8

Total

The total estimated cost of this acquisition is . The first ordering period will satisfy requirements for Air National Guard, Air Combat Command, Pacific Air Forces, United States Air Forces Europe, and Foreign Military Sales (FMS). Procurement of the testers during the first ordering period will be funded with 3400 Operational & Maintenance funds and FMS funds. Subsequent ordering periods will be funded with 3010 (BP12) funds.

The ordering validity period of this Requirement contract is projected to be 30 Jun 2019 to 29 Jun 2024. Delivery of the EWTS is estimated to be 210 days After Receipt of Order (ARO). This J&A covers the scope of not only the ordering validity anticipated for the IDC but through completion of all task or delivery orders as well as any increases above the BEQs stated.

NSN 4920-01-607-8242 was screened and assigned an Acquisition Method Code (AMC)/Acquisition Method Suffix Code (AMSC) of 3R:

AMC 3. Acquire, for the second or subsequent time, directly from the actual manufacturer.

AMSC R. The Government does not own the data or the rights to the data needed to purchase this part from additional sources. It has been determined to be uneconomical to buy the data or rights to the data. It is uneconomical to reverse engineer the part. This code is used when the Government did not initially purchase the data and/or rights.

IV. Statutory authority permitting other than full and open competition.

10 U.S.C. 2304(c) (1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

V. Demonstration that the contractor's unique qualifications or nature of the acquisition requires the use of the authority cited above (applicability of authority).

The agency's minimum needs can only be satisfied by the unique supplies or services available from DCX Division as demonstrated in the following paragraphs.

Lockheed Martin Corp. was the original equipment manufacturer (OEM) of the EWTS. British Aerospace Engineering (BAE) Systems, Inc. acquired the division of Lockheed Martin Corp. for the EWTS in November 2000. An engineering change order was initiated to upgrade P/N 16U23510-3 variant to P/N 16U2351-5, which was verified and validated by AFLCMC/WNZAB on 16 Jan 2013.

DCX Division was a sub vendor to BAE during the development of the variant 5 configuration of the EWTS in which DCX Division maintains configuration control of the EWTS and retains the associated proprietary rights to the technical data. DCX Division has since been the sole manufacturer for the EWTS.

The EWTS is highly specialized in that it tests for engine rotor speed (N-), fan turbine inlet temperature, and simulates engine operational conditions to ensure proper function of the engine warning lights of the F-16 aircraft series group engines (models/series A/B/C/D). This test set must be able to interface with the complete series of F-16 models of turbine engines and properly simulate engine states so that the warning lights function properly under all conditions. The sustainment life

March 2018 FOR OFFICIAL USE ONLY Page 4 of 8 cycle of the EWTS is dependent on the life of the F-16 aircraft program which is currently projected to end in 2030.

In Mar 2014, the Government made efforts to solicit a EWTS requirement under Full and Open Competition (F&OC) procedures. There were at least three (3) requests for additional/missing drawing information needed by prospective bidders. One vendor indicated that DCX Division would not sell some parts required for the effort because the parts were proprietary. Review of the technical data confirmed that some drawings for the current configuration indicates parts proprietary to DCX Division. Due to the Government's lack of a complete Technical Data Package (TDP), DCX Division proprietary makings on some drawings, proprietary parts, and engineering issues that surfaced, the solicitation was cancelled.

In Oct 2014, DCX Division was contacted regarding the sell of the TDP to the Government. DCX Division responded via letter on 22 Oct 2014 stating they were not willing to sell subassemblies of the Engine Warning Test Set, part number 16U23510-5 or the proprietary data to other vendors. The letter mentioned that the Engine Warning Test Set, part number 16U23510-5, contains various elements that are DCX-CHOL Enterprises proprietary design upgrades. The letter further identified subassemblies that have been modified due to part obsolescence since the original design and are considered proprietary. Those subassemblies were identified as the following:

DCX16U3556-801 Amplifier Printed Circuit Board Assembly DCX16U2714-1 Oscillator Printed Circuit Board Assembly DCX16VF003-2A Pratt Whitney Tachometer Indicator Digital Gauge (P/N DCX16VF003-21A GE Tachometer Indicator Digital Gauge DCX16VF004-4A Temperature Indicator Digital Gauge

In addition to the letter from Oct 2014, DCX Division reiterated in emails dated 22 Feb 2017 and 08 Jan 2018, their unwillingness to sell the proprietary data rights for the EWTS.

The last procurement for EWTS configuration “-5” was on 06 Jun 16 via delivery order (DO) FA8232-16-F-0066 issued against FMS source directed contract FA8232-15-D-0001 with BAE Systems. The final delivery on this DO was on or before 31 May 17 for 1 unit. The Government was FMS source directed to utilize BAE for the procurement of the EWTS. BAE in turn utilized DCX- Division as a sub vendor to manufacture the EWTS to satisfy the FMS requirement and others historically. BAE does not possess the technical data associated with multiple subcomponents and subassemblies that were developed by DCX Division for the -5 configuration of the EWTS and are therefore noncapable of manufacturing the EWTS independently. BAE confirmed this via email to the Government in May 19 where they acknowledged that they could provide the Government with the EWTS through subcontracting but could not manufacture the EWTS because they did not possess the DCX subcomponent information.

Given the lack of proprietary data and the unwillingness by DCX Division to sell the necessary data to the Government, the feasibility of a reverse engineering effort was investigated. The Government has determined that reverse engineering would be cost prohibitive based on comparison to a similar reverse engineering effort for the Synchrophaser System Test Set. An economic cost-benefit study was accomplished during the business case analysis (BCA) in Oct 2010 for a similar tester component part. The tester, Synchrophaser System Test Set, was estimated to cost to reverse engineer and it would take more than two years before final acceptance by the United States Air Force (USAF) could be completed.

March 2018 FOR OFFICIAL USE ONLY Page 6 of 8 recovered through competition, as well as unacceptable delays in fulfilling its requirements.

VI. Description of efforts made to ensure that offers are solicited from as many potential sources as practicable.

A Sources Sought (SS) / Request for Information (RFI) synopsis was posted to Federal Business Opportunities (FedBizOpps) on 08 Jan 2018 with a response date of 07 Feb 2018 under Solicitation FA8533-18-E-WARN. The SS/RFI requested responses from interested vendors that possess the expertise, capabilities, and experience to meet qualification requirements for this effort. One response was received from an interested vendor other than the incumbent. This vendor's capability was evaluated and they were determined not capable of producing the EWTS because they are not able to acquire the proprietary EWTS TDP from DCX Division.

The requirement will be synopsized in FedBizOpps in accordance with FAR 5.201. It is anticipated that sources having an interest in subcontracting may be identified through synopsis. Any source who responds to the Government as a result of this synopsis will be identified to the prime contractor as a potential subcontracting possibility.

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

The overall cost of this acquisition will be fair and reasonable to the Government. In accordance with FAR 15.403-4, the contractor will be required to provide certified cost or pricing data to be used to support the Government's evaluation of the proposed cost. The proposed skill mix of labor, labor hours, types and quantities of material and other direct costs, and direct and indirect rates will be negotiated by the Government based on recommendations from the Defense Contract Management Agency and expert technical personnel supporting the program. The contract price will be negotiated in accordance with the procedures in FAR Part 15 ensuring the ultimate cost to the Government is fair and reasonable.

VIII. Description of the market research conducted and the results, or a statement of the reasons market research was not conducted.

Market research was conducted in accordance with FAR Part 10.001 and 10.002 and was completed on 08 Nov 2018. Market research techniques used are as follows:

As described in Section VI above, a SS/RFI was posted to FedBizOpps advising industry of the pending acquisition and soliciting inquiries from interested vendors. The SS/RFI was posted on 08 Jan 2018 under Solicitation Number FA8533-18-E-WARN. One response was received from an interested vendor other than the incumbent. They were determined not capable because they were not able to acquire the DCX Division proprietary TDP.

Queries included researching the following company websites. Finding concluded DCX Division is

March 2018 FOR OFFICIAL USE ONLY Page 7 of 8 the only fully capable vendor.

www.dcxchol.com www.baesystems.com.

Documentation in the Program Execution and Tracking System, Purchase Request Process System database, and FedLog Information Service was reviewed.

Internet searches using www.google.com, www.yahoo.com, www.bing.com were undertaken using search strings “4920-01-607-8242”, “4920-01-194-3772”, “16U23510- 1, -3, -5”, “engine warning test set”, “turbine engine test set” and “warning lights”. The results of the techniques identified potential vendors that may be able to build the aircraft engine test set for F100/F110 engine variants on the F-16 aircraft but not the EWTS.

Research showed several vendors could manufacture the EWTS if DCX Division could supply them with the DCX Division proprietary drawings and parts. However, at this time, DCX Division will not sell proprietary data/parts to other vendors, therefore these vendors were determined not capable.

A Small Business Administration Dynamic Small Business Search query was conducted utilizing North America Industry Classification System code 336412. The search revealed several potential vendors but after evaluation of the vendors it was determined they were not capable because they are not involved with engine component testing and are not able to acquire the proprietary data from DCX Division. The EWTS does not fit the definition of a commercial item as defined in FAR Part 2.101.

This item is defined as military-unique and is not customarily used by the general public or by non- Governmental entities. The Government requires parts that meet an exact form, fit, and function as determined by the specific mission. The EWTS is unique to military applications and is not considered Commercial-off-the-Shelf equipment. An extensive web search did not produce any other manufacturers of commercial test equipment that meet form, fit, and function equivalent or that could be modified to be equivalent in place of the EWTS.

The market research concluded DCX Division is the only vendor capable of fulfilling the Government's requirement for the EWTS.

IX. Any other facts supporting the use of Other Than Full and Open Competition.

None.

X. List of any sources that expressed, in writing, an interest in the acquisition.

See Section VI above.

XI. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before making subsequent acquisitions for the supplies or services required.

The Government does not possess the TDP for the EWTS to support full and open competition. An inquiry for sell of the TDP was sent to the DCX Division on 08 Jan 2018. They responded the same

March 2018 FOR OFFICIAL USE ONLY Page 8 of 8 day and declined interest in selling the TDP.

A reverse engineering effort is estimated to cost and take approximately to complete. It is estimated to take before the Government would recoup this type investment, therefore it is not considered feasible to pursue. The sustainment life cycle of the EWTS is dependent on the life of the F-16 aircraft program which is currently projected to end in 2030.

A plan to break barriers to competition was not identified in a prior J&A as the most recent contracts executed were FMS source directed. As such, the requirement mandated per DFARS PGI 206.304(a) (S-70) (ii) is not applicable. In order to break barriers to competition, the Government will continue to engage with the DCX Division on an annual basis, prior to the entrance of each ordering period to determine the feasibility of procuring the TDP.

XII. Certification by the Contracting Officer.

As evidenced by my signature above, I have determined this document to be both accurate and complete to the best of my knowledge and belief.

XIII. Certification by the technical/requirements personnel.

As evidenced by my (our) signature(s) above, I (we) certify that any supporting data contained herein, which is my (our) responsibility, is both accurate and complete.