J&A_Redacted.pdf

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

FOR OFFICIAL USE ONLY

FOR OFFICIAL USE ONLY13 Sep 2017

NOTE: If a Justification and Approval was approved for the preceding acquisition, a copy of the approved J&A for the predecessor action must be included in the staff package for approval of the instant J&A. This applies to J&A staff packages that are submitted for review and approval at a level above the contracting officer. The predecessor J&A will be used as a reference document by the approving official.

Is this a new or amended J&A Document? New Amended ( Prior to Award Only! )

Funding level for this acquisition: < $700K > $700K and < $13.5M > $13.5M and < $93M > $93M

Contracting Activity: AFSC/PZIMA

Purchase Request / Local ID Number: FDB 49478 & 50546

Program / Project (and PE, if applicable): Teradyne L-Series, Spectrum, and TS128 Test Systems Maintenance and Repair

Program Type (PEO or Other Contracting): Other Contracting

Authority: 6.302-1 – 10 USC 2304(c)(1), Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements

Estimated Contract Cost (including options): J&A Type: Class Individual

COORDINATION (AFFARS 5306.304(a) )

Date

05 Dec 2017

Acquisition Program Manager

Date

11 Dec 2017

Contracting Officer

Signature

Date

Local Legal Reviewer

APPROVAL (AFFARS 5306.304(a) )

Date

Competition Advocate

FOR OFFICIAL USE ONLY

FOR OFFICIAL USE ONLY13 Sep 2017

I. Contracting Activity.

This Justification and Approval to request authority for Other Than Full and Open Competition supports requirements generated for 402 EMXG/MXDEC and 402 SMXG/FLT F. The contracting authority for this requirement is AFSC/PZIMA, Operational Contracting, Robins AFB, Georgia. The purchase request numbers supporting this contracting action are 18-49478 and 18-50546.

II. Nature and/or description of the action being processed.

Due to the circumstances described herein, the activity requests authority to acquire Teradyne L- Series, Spectrum, and TS128 Test Systems and components maintenance and repair using Other Than Full and Open Competition (OTF&OC) prescribed by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. This action will be awarded as a new sole source contract. This requirement will be a five (5) year Firm-Fixed Price (FFP) contract with a basic year and four (4) 1-year options (09 Mar 2018 - 08 Mar 2023)

This sole source requirement will be procured from the following:

Source: Teradyne, Inc.

DBA: Assembly Test Division 700 Riverpark Drive North Reading, MA 01864-2634 CAGE Code: 23350 Large Business

III. Description of supplies/services required to meet agency needs.

The 12 Teradyne Automatic Test Equipment (ATE) systems and associated components support repair processes for Avionics Line Replaceable Units (LRUs) and Shop Replaceable Units (SRUs) employed for F-15 aircraft, the Joint Surveillance Target Attack Radar System, C-130 Special Operations Forces aircraft, Low Altitude Navigation and Targeting Infrared for Night, and Joint Helmet Mounted Cueing System weapons systems.

The proposed contract will provide the 402d EMXG/MXDEC and 581st SMXG/FLT F with on-site preventive maintenance, replacement parts, and unscheduled maintenance for Teradyne M-910 Cards, Spectrum, TS-128 Test Stations, L-Series test equipment, and M-925-00 circuit card assemblies located on the 12 ATE systems. Calibration services are required annually on L-Series Testers and TS-128 Test Stations. Unscheduled maintenance consists of on-call telephone assistance and on-site repair services if telephone assistance fails to resolve the problem. The requirement includes preventive maintenance semi-annually on the L-Series, Spectrum, and TS128 testers.

The type funds for this effort is Consolidated Sustainment Activity Group (CSAG-M) funds, Defense Working Capital Fund (4930). The projected Period of Performance (PoP) is 09 Mar 2018 to 08 Mar

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2023, if all options are exercised. The basic and option period requirements for EMXG and SMXG are shown below:

Period of Performance EMXG SMXG Sub-Total Base Yr. 9 Mar 2018 - 8 Mar 2019

Option 1 9 Mar 2019 - 8 Mar 2020

Option 2 9 Mar 2020 - 8 Mar 2021

Option 3 9 Mar 2021 - 8 Mar 2022

Option 4 9 Mar 2022 - 8 Mar 2023

Total Estimated Value =

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. This acquisition will follow procedures of FAR 13.5, “Simplified Procedures for Certain Commercial Items.”

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 Teradyne ATEs consists of commercially available equipment that has been modified for Government use. The modified equipment is highly specialized and complex. The equipment utilizes proprietary data for software drivers and circuit card assemblies. The ATEs control complex test instruments, such as digital voltmeters, waveform analyzers, signal generators, and switching assemblies used to support SRUs consisting of circuit cards and LRUs that are black boxes. The Air Force employs the SRUs and LRUs on major weapons systems for F-15 aircraft, the Joint Surveillance Target Attack Radar System (JSTAR), C-130 Special Operations Forces (SOF) aircraft, Low Altitude Navigation and Targeting Infrared for Night (LANTIRN), and the Joint Helmet Mounted Cueing System (JHMCS).

The ATEs have their own computers and operating systems that perform tasks such as self-test, self-calibration, tracking preventative maintenance requirements, test procedure sequencing and storage, and retrieval of digital information. They utilize a multitude of digital/analog circuit cards, power supplies, test measurement equipment, and instrumentation controlled by Test Program Sets (TPSs).

The TPSs consists of 402d Software Maintenance Group developed test software, interface devices and associated documentation tailored specifically for each item of tested electronic workload. The computer in the ATE executes the TPS test software and sends signals where needed to take measurements at appropriate points. The test software then analyzes the results of the measurements and determines the probable cause of failure. It displays to the technician the component to remove and replace.

Calibration, troubleshooting, and repair requires ATE expertise. Teradyne technicians possess the

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FOR OFFICIAL USE ONLY13 Sep 2017 specialized training and experience required to understand the intricacies of each type of system design, theory of operation, failure tendencies, and the particular nuances of the system and associated equipment. Contributing to the complexity of maintaining the ATEs is the extensive knowledge required to troubleshoot a multitude of digital/analog circuit cards, power supplies, test measurement equipment, and instrumentation controlled by the TPS. Furthermore, Teradyne L-Series testers have been obsolete for years resulting in a shortage of repair parts. Only Teradyne has the necessary inventory to provide the logistical support for L-Series tester parts, and owns the design technical data necessary to produce additional assets, if needed.

The ATE system design utilizes specialized core processes, materials, and critical timing paths with proprietary software and drivers that only Teradyne technicians can access. Teradyne, Inc. has provided the calibration, preventive maintenance, unscheduled maintenance, and replacement parts for the ATE systems and components for the last 11 years. Teradyne is the Original Equipment Manufacturer (OEM) and owns the proprietary data for the hardware and software needed to service and repair the equipment. The current contract, FA8571-15-C-0004, was awarded sole source to Teradyne, Inc. on 3 March 2015 and expires on 8 March 2018. Teradyne is the only source with the trained technicians, specialized technical knowledge, proprietary data, drawings, and specifications to provide the required support.

Teradyne was contacted on 22 Feb 2017 and asked if they would be willing to grant the Government data rights. Teradyne replied on 23 Feb 2017 that they would not sell the data rights, limited rights, or drawings for their complex instrumentation or for the obsolete L-Series equipment. Detailed design documentation for Teradyne's products is not available outside of Teradyne. Teradyne does not license anyone to sell or repair its products.

Robins Air Force Base's reverse engineering capabilities are limited to the 402d Avionics Maintenance Group's reverse engineering of avionics commodities for obsolete parts or non-commercially available avionics parts. It is anticipated to take approximately 6 months to award a reverse engineering contract and 6 to 9 months for a new contractor to complete the reverse engineering effort.

If a reverse engineering effort resulted in changes to a brand of unfamiliar ATE, EMXG engineers estimate that 6 weeks of combined classroom training and on-the-job training would be required, and an additional 6 to 12 months would be required for technicians to become familiar with the nuances of the new equipment. Additionally, delays due to rehosting workload test programs would take approximately 2 to 4 years per ATE configuration depending on a particular tester's assigned workload. Test station instructions would have to be re-written and technical orders for SRUs and LRUs would require updating which would require the approval of each System Program Office (SPO) responsible for configuration control of the workloads tested on those test stations. Approval could take months of processing time to acquire.

The EMXG engineering section estimates the costs to rehost the Teradyne ATE systems with another manufacturer's ATE at approximately $43.8M. This estimate was derived using replacement costs contained in EMXG's Test Equipment Database for 42 TS128 testers, 118 L-Series testers, and 22 Spectrum testers, and includes re-writing the software for Test Program Sets and hardware costs to replace the existing ATE systems with another manufacturer's equipment.

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The 402d EMXG and 581st SMXS produce a high volume of workload tested by the Teradyne ATEs supporting the JSTARS, LANTIRN, F15, B1B, B52, C130, and C5 aircraft. Any loss of contract support services due to reverse engineering or other efforts would severely jeopardize the production for those weapon systems by crippling the sustainment capabilities of the ATEs. This would result in extended periods of unavailability, probable Mission Impaired Capability Awaiting Parts (MICAP) conditions, and lengthy turnaround times for replacement parts.

While there are other manufacturers of commercially available ATEs, those companies do not have knowledge of the Teradyne ATEs or possess the proprietary data required for maintenance and repair functions. It is standard practice within the industry, that ATE systems be repaired, maintained, and inspected by the OEM and their certified technicians to ensure that the highest standards of performance and quality are met. By obtaining the specialized maintenance and repair service from Teradyne, Inc., the Government will preserve and extend the life of the equipment until it can be rehosted to the Air Force approved Versatile Depot Automatic Test Station (VDATS). Current estimates by EMXG and SMXG predict that all of the L-Series testers will be rehosted to the newer Air Force approved VDATS by the end of the fourth quarter 2020. Without the current service provided by Teradyne, the failure of an ATE could occur resulting in negative mission impact for the Air Force.

Accordingly, Teradyne is the only firm capable of providing the supplies and services described in Section III above without the U.S. Air Force experiencing substantial duplication of cost that could not be expected to be recovered through competition and 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 Request for Information (RFI) under solicitation number “Teradyne_L- Series_Spectrum_and_TS128_Test Systems_Maintenance_and_Repair was posted on the Federal Business Opportunities (FedBizOpps) web site 07 Jun 2017 with responses due by 07 Jul 2017. The RFI requested responses from sources that may possess the repair data, expertise, capabilities, and experience to perform the required services. There were zero responses received.

In accordance with FAR 5.201, this requirement will be a combined synopsis/solicitation for commercial items on FedBizOpps. Sources expressing an interest as a result of the synopsis will be identified to the prime contractor as potential subcontracting sources FedBizOpps.

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

Negotiations will be conducted in accordance with FAR Part 12 to ensure the prices to the Government are fair and reasonable. This acquisition will follow procedures of FAR 13.5, “Simplified Procedures for Certain Commercial Items.”

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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 and completed 15 Sep 2017 in accordance with FAR Part 10 to determine if changes have occurred in the market that offer solutions other than that provided by Teradyne, Inc. A Dynamic Small Business Search (DSBS) was performed using NAICS codes, 334515, Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals and 811219, Other Electronic and Precision Equipment Repair and Maintenance. In addition, the keywords: "Automatic Test Equipment", "Circuit Card", and "Line Replaceable Unit" were used in the queries. A search of 8(a), HUBZone, SDVOB, WOSB socio-economic groups of small businesses returned 36 vendor profiles. These vendors were evaluated to determine their overall capability to meet the specified performance requirements and determined not capable. The vendors identified did not possess the proprietary data, specialized training, and repair expertise required to perform calibration, preventive maintenance, component replacement, and repair on the Teradyne ATEs.

RFI under solicitation number “Teradyne_L-Series_Spectrum_and_TS128_Test Systems_Maintenance_and_Repair was posted on FedBizOpps 07 Jun 2017. There were zero responses received.

The equipment and required services are commercial in accordance with FAR 2.101. The Teradyne ATE systems have been modified for Government use, however still considered commercial equipment. The ATE systems contain proprietary hardware data that is unique to the Air Force's weapons platforms. Any other commercial firm would need access to the proprietary data in order to perform the required services.

The results of the market research investigation concluded that Teradyne, Inc. is the only source of maintenance, repair, and support services for the Teradyne ATEs and related components. Proprietary rights prohibit any other commercial entity from performing calibration, maintenance, or repair services on Teradyne equipment.

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 Teradyne ATEs consist of highly specialized and complex test equipment utilizing proprietary data for software and drivers. Teradyne was contacted in Feb 2017 and asked if they would grant the Government data rights. Teradyne responded stating they do not sell data rights, limited rights, or drawings for their current complex instrumentation, or for the obsolete L-Series equipment, and they

FOR OFFICIAL USE ONLY

FOR OFFICIAL USE ONLY13 Sep 2017 do not license anyone to sell or repair its products.

Currently, there is no organic capability to accomplish the work on the Teradyne systems at Robins AFB. There are no OEM certified, factory-trained available resources qualified to perform the necessary maintenance and repair on the ATE systems. It is anticipated to take approximately 6 months to award a reverse engineering contract and 6 to 9 months for a new contractor to complete the reverse engineering effort. Reverse engineering efforts could require additional training for EMXG/ SMXG technicians. This training is estimated to take 2 to 4 years per ATE. In addition, SPO approval would be required before test station instructions could be re-written and technical orders updated. The ATE re-hosting cost of 12 Teradyne ATE systems with another manufacturer's ATE is estimated at $43.8M and take up to five years to complete therefore not feasible.

Current estimates by EMXG and SMXG predict that all of the L-Series testers will be rehosted to the newer Air Force approved Versatile Depot Automatic Test Station (VDATS) by the end of the fourth quarter 2020. Therefore, there is no support planned for the L-Series ATEs after option year 2. Once all Teradyne L-Series are rehosted to VDATS, the Government will provide organic support for the maintenance and repair of the VDATS systems and a maintenance and repair contract will no longer be required.

The Teradyne Spectrum and TS128 testers are currently serviceable and not obsolete. According to EMXG's 20-year modernization plan, efforts to rehost the Spectrum and TS128 testers are identified to take place between FY25 and FY36. Teradyne's LASAR software is used to generate digital test programs and provide diagnostic information for the M-series digital circuit cards. Use of this currently limits their replacement because no other manufacturer's software is capable of accurately predicting how the Teradyne boards will behave under test to allow debugging in the software. Based on the above, there are currently plans to break barriers to competition.

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.