KC-10A_Mode_5_Installation_justification_and_approval_19_Mar_19-Redacted.pdf

FOR OFFICIAL USE ONLY

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

FOR OFFICIAL USE ONLY March 2018 Page 1 of 7

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

Is this a Bridge Action as defined in the AF Bridge Action Reduction Plan? Yes No

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

Contracting Activity: AFMC AFLCMC/WKDK

Purchase Request / Local ID Number: FD2030-19-32056

Program / Project (and PE, if applicable): KC-10 Mode 5 Installation and Software Update

Program Type (PEO or Other Contracting): PEO Tankers

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) ) ** The text in the signature blocks below is editable, including the title.

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X

APPROVAL (AFFARS 5306 . 304 ( a) )

Date Alternate Competition Advocate Signature

19 Mar 2019

Mary Semyone

AFSC/PZCA/405-739-5513

Digitally signed by

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.

Sign and Save Procedure

Date

07 Feb 2019

Project Lead / Program Mgr / Requiring Activity

Signature

Date

07 Feb 2019

Contracting Officer

08 Feb 2019

Local Legal Reviewer

07 Mar 2019

Chief of the Contracting Office (COCO)

FOR OFFICIAL USE ONLY March 2018 Page 2 of 7

I. Contracting Activity.

United States Air Force

AFLCMC/WKDK

3001 Staff Drive

Tinker AFB, OK 73145-5320

PR: FD2030-19-32056

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

This individual Justification and Approval (J&A) authorizes the use of other than full and open competition procedures for installation and software update of 58 each KC-10 Mode 5 Identification Friend or Foe (IFF) modification by Original Equipment Manufacturer (OEM) Collins Aerospace, Commercial and Government Entity

(CAGE) 13499. Collins Aerospace (previously Rockwell Collins Inc (RCI) is the OEM for the mode 5 system and approximately 80% of the commercial KC-10 aircraft flight deck. This will be a new contract for non-commercial service using FAR Part 15 procedures.

The estimated value of this contract is . The contract will utilize firm fixed price (FFP), cost reimbursable-no fee (CR), and cost plus fixed fee (CPFF) as described in section III. The contract type will be a "C" type, Definite

Quantity contract. The contract will have an 18-month delivery schedule with estimated completion in Feb 21. There are no options for this contract effort. The projected award date is Aug 19.

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

This will be a service contract for the following items. All items will be funded with 3010 procurement dollars.

As previously stated in section II, the delivery schedule to complete all 58 each Mode 5 system installations is estimated and shall be accomplished not later than 18 months after award of contract. Each Mode 5 system installation includes the necessary software updates but herein will only be referenced as "installation". In addition to installation of the Mode 5 system, the contractor shall be required to ship items such as line replaceable units and other materials that cannot be upgraded on the aircraft. The contractor shall update system drawings and technical data as required based on aircraft differences. The delivery schedule will be based on specific dates after receipt of aircraft and is based on mission requirements.

CLIN Deliverable Contract Type

0001 Installation of KC-10 Aircraft Mode 5 System FFP

0002 Technical Data Updates CPFF

0003 Travel CR-No Fee

0004 Shipping/Transportation CR-No Fee

0005 Over and Above FFP/TBN

0006 Data Not Separately Priced

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

10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii), 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 requested services will consist of a physical kit inventory, software updates, installation of Mode 5/ Automated

Dependent Surveillance-Broadcast (ADS-B) Out modification to include removal of unused wiring and installation of new kits in accordance with Collins Aerospace drawing package, continuity, disturbed systems pre/and post installation operational checks, engineering support to support troubleshooting as required, and

FOR OFFICIAL USE ONLY March 2018 Page 3 of 7 return aircraft to service. The contractor shall include a completed FAA 8130-31 statement of conformity -

Military Aircraft. The contractor shall support quality assurance (QA) to ensure installation is in accordance with

Collins Aerospace Supplemental Type Certificate (STC), Certificate of Conformance (COC) for upgraded

Control Display Units to Collins Aerospace proprietary technical data.

This is a follow-on contract to the Engineering, Manufacturing and Development (EMD) activities for production of a major system. The EMD task order for KC-10 Mode 5 system was awarded on contract FA8105-17-

D-0006, Task order for Engineering Assignment FA8105-18-F-0008 with current obligated value of $11.6M as sole source to Collins Aerospace. The J&A document for FA8105-17-D-0006 was previously approved on 6 Feb

17 by Brigadier General Duke Richardson for KC-10 Avionics Sustaining Engineering Support. Collins

Aerospace is the only company with the special test equipment, personnel, and technical data to satisfy the Air

Force's minimum need. The Mode 5 program is a modification of the KC-10 Communication, Navigation, and

Surveillance Air Traffic Management (CNS/ATM) system. The KC-10 CNS/ATM suite is a highly specialized and safety-critical avionics and navigational system consisting of several million lines of Collins Aerospace proprietary code interfacing with multiple other sources within the KC-10 Avionics suite. Therefore, this acquisition will be a follow-on contract for the continued production of a major system.

The Mode 5 installation requires an A-kit and B-kit. The A-kit consists of approximately 3 bundles of wires and attaching hardware. The B-kit consists of installing 1ea APX-119-0531, 1 ea KIV-77, proprietary software in the

Multi-Function Display (MFD), on-site proprietary software/firmware into the Control Display Units (CDU) and a

Collins Aerospace part number to be installed on the updated CDUs. System installation requires specific involvement of proprietary data that requires Collins Aerospace to load software/firmware on the CDU-7000 for the purposes of upgrading to meet the Technical Standard Order (TSO) authorization, resulting in a highly specialized modification of a major system. The resulting activity requires a change to proprietary technical data and TSO of the CDU-7000 which is owned by Collins Aerospace.

Initial modification of the CDU is required to be accomplished at the main operating base to significantly reduce cost and aircraft downtime. The logistics time-lines for removal, shipping, updates, test processes, and return of CDU and limited quantity of spares prevent establishment of a rotable pool. Therefore, the on-site concept will result in an estimated savings of and 120 days per unit associated with turnaround time for the upgrade.

On 20 Dec 18, the Government asked Collins Aerospace if they would consider sale or licensing proprietary technical data associated with this modification. Collins Aerospace replied 4 Jan 19 with a definitive "no".

Supplemental Type Certificate artifacts are proprietary to Collins Aerospace and are considered competition sensitive and are not released to third parties for liability purposes. The government has limited rights to technical data as defined within applicable drawing legends and in accordance with the applicable FAR/DFARS.

Collins Aerospace is the sole holder of the STC for this avionics upgrade to the KC-10 aircraft, designed the integration package and retains rights to proprietary, intellectual data necessary for successful implementation of the aircraft modification. The proprietary data is not able to be purchased by the government as stated in the

Collins Aerospace contract letters. The estimated cost to obtain proprietary data via outright ownership of

Collins Aerospace is in the range of $1.5B. The procurement of data could not be recovered through competition based on the estimated cost and near-future of projected aircraft retirements.

AFLCMC/WKDB believes that award to any other source would result in substantial duplication of cost to the

Government not expected to be recovered through competition and unacceptable delays in fulfilling the Air

Force's requirements.

ADS-B is a next generation surveillance technology incorporating both air and ground aspects providing air traffic control with a more accurate picture of the aircraft's three-dimensional position in the en route, terminal, approach, and surface environments. The aircraft provides the airborne portion in the form of a broadcast of its identification, position, altitude, velocity, and other information. The ground portion is comprised of ground stations, which receive these broadcasts and direct them to air traffic control automation systems for presentation of a controller's display, with much improved accuracy over existing technology. The result is increased safety, efficiency, capacity and predictability allowing for more direct routes, reduced fuel consumption and fewer emissions being produced. Through this data precision, air traffic control is evolving

FOR OFFICIAL USE ONLY March 2018 Page 4 of 7 from a system of knowing approximately where an aircraft is to one based on knowing where each aircraft is headed and where it will be a designated points along its projected flight path for improved efficiency and capacity. This is known as trajectory-based operations allowing for decreased separation, increased air speeds and more direct routes. If the KC-10 Mode 5 system is not installed by the FAA mandate of 1 Jan 20 the fleet will be required to fly alternate routes due to failure to comply with the subject mandate and sister mandates around the world. These alternate flight patterns will increase flying hour cost by an estimated per month totaling to the Government. This cost estimate is based on the AFTOC database, and the 618 AOC/

XOND (TACC) data.

Any potential contractor would require access to Collins Aerospace developed proprietary data to perform the other services of engineering support, completing FAA 8130-31 Certification, Field Support Engineer on-site technical support, Engineering Change Orders, quality assurance activities to ensure installation is in accordance with Collins Aerospace STC, and Certificate of Conformity for upgraded CDUs. If another vendor was selected to perform the installation, the duplication of cost would come from two areas: procurement of the proprietary data from Collins Aerospace and an additional contract to Collins Aerospace to perform the above tasks. The additional contract would require Collins Aerospace Field Support Engineers (FSE) to be located at each operating base to avoid schedule delays; however, it is unlikely the FSEs would be fully utilized.

Installation by a vendor other than Collins Aerospace would include tasks for QA oversight in order to sign off FAA

8130-31 Statement of Conformity, tasks that could be performed by the already on-site Collins FSE. The

Government would be paying for an additional FSE/FSR per install team, at a cost of , per contractor budgetary planning estimate.

Competition of installation would create a significant unacceptable delay to the program's completion, through delay in contract award (+2 months) and a lack of expertise in troubleshooting problems during installations (+4 months). The contemplated additional 2 months for competition was based on the standard AFLCMC time-line for contract award. The estimated time for a competitive acquisition without discussions is approximately 197 days from release of request for proposal. The estimated time for a sole source contract is approximately 130 days from release of request for proposal. The program office estimates the aforementioned 4 months for troubleshooting problems is based on lead-time for a contractor to secure a subcontract with Collins Aerospace for field service engineering support. Accordingly, Collins Aerospace is the only company capable of providing the services described in section III above without the U.S. Air Force experiencing substantial duplication of cost that could not 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.

The KC-10 Program Office released a combined Request for Information (RFI)/Sources Sought Synopsis (SSS) on 4 May 18 (“KC-10 Mode 5 Production Installations - FA810518R0005”) which generated one respondent, Collins Aerospace. The government issued a revised RFI/SSS on 21 Dec 18. Three companies, Northrop

Grumman, L2 Aviation, and The Boeing Company expressed significant interest and were asked to provide a letter of intent from Collins Aerospace to enter into a teaming arrangement for the entire effort. Northrop

Grumman did not respond to request for letter of intent, L2 returned a response indicating they could only perform as subcontractor, and the Boeing Company stated they could not secure an agreement from Collins

Aerospace and could not be prime contractor without such agreement.

Only Collins Aerospace responded to both requests. Collins Aerospace is the design entity and Supplemental Type

Certificate holder of the modification and supporting installation package. In addition, the Mode 5 multi- functional team has reached out specifically to three other companies, including our KC-10 Airframe Contractor Logistics

Support contractor, L-3 Vertex. L-3 Vertex is capable of partially completing the stated requirements; however, they are unable to satisfy the full requirement and subject to the duplication of cost and unacceptable delay to the program as they do not have access to proprietary data necessary for successful performance.

This requirement will be synopsized in http://www.FedBizOpps.gov as a notice of proposed contract action IAW http://www.fedbizopps.gov/

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FAR 5.201 at least fifteen days prior to releasing the request for proposal.

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

The Contracting Officer will ensure the items described herein are negotiated at a fair and reasonable price to the Government. IAW FAR as supplemented, the contractor will be required to submit Certified Cost or Pricing Data and/or Other Than Certified Cost or Pricing Data. A detailed cost analysis and price analysis will be performed. The

Contracting Officer will request a technical evaluation from the Defense Contract Management Agency (DCMA) or

AFLCMC/WKD to aid in the evaluation of the contractor's proposal. The Contracting Officer will seek an audit assistance from the Defense Contract Audit Agency (DCAA) if necessary.

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

The KC-10 Mode 5/ADS-B Out Market Research data was collected through multiple methods across a 14-month period in accordance with FAR Part 10.002(b)(2). The government utilized postings on Federal Business

Opportunities Website, contact with the Small Business Office, two sources sought synopses as previously discussed in section VI, and subject matter experts.

Additional searches were performed on FedBizOpps and the Electronic Data Access for similar or identical requirements acquired by other government agencies. As a result of the market research, the services have been identified as being non-commercial and not customarily available in the commercial marketplace in accordance with FAR 10.002(d)(1). This service requires unique experience, expertise, data, and equipment. Collins

Aerospace owns the proprietary data required for this effort and they are the only firm capable to perform this requirement.

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

The government realizes that it has unlimited rights to form, fit, and function data, including source qualification data, as well as data related to operation, maintenance, installation, and training (OMIT). However, such rights are insufficient to satisfy the current need. Access to production drawings and software code is necessary to accomplish the tasks for this acquisition. Efforts by the Government to acquire a license from the Collins

Aerospace have been unsuccessful. The most recent attempt by the Government to acquire the data or rights to the data occurred on 20 Dec 18 when the PCO sent Collins Aerospace a letter requesting Collins Aerospace to provide a position relative to license or sale of proprietary technical data as related to this modification.

Collins Aerospace provided a response 4 Jan 19 declining the sell or license of data rights.

The capabilities necessary to reverse engineer the system in a timely and cost effective manner exceeds the current in-house engineering capabilities. The APX-119 Digital IFF Transponder and associated interfacing line replaceable units are highly specialized equipment containing a high degree of complexity for integration into the existing avionics suite. The estimated cost to reverse engineer this item is and may require up to

3.5 years to develop and test a reverse engineering derived alternative which negates this as a viable solution based upon the cost and required schedule. This estimate was based on information provided by the C-17

Program Office as stated in the Justification and Approval for the KC-135 APX119 Upgrade and certified the

AFLCMC/WKDM Program Manager on 29 May 18. The Air Force expects to begin retirement of the KC-10 aircraft in FY19; therefore it is not considered possible to recover the cost of reverse engineering over the life expectancy of these parts and it is not possible to draft adequate procedures without the necessary technical data, which would drive unacceptable delays in fulfilling the Air Force's requirement.

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

The following sources expressed interest as a result of the previously stated sources sought synopses.

Collins Aerospace, CAGE 13499

400 Collins Road NE

Cedar Rapids, IA 52498

OEM for modification and considered qualified and capable.

Tyonek/Zenetex CAGE 1XPL6, Madison, AL

L-3 Vertex CAGE 1P066, Madison, MS

The Boeing Company CAGE 1GTA0, San Antonio, TX

Ackerman Engineering CAGE 82FA4, Wheat Ridge, CO

BW Sprague CAGE 7YCK4, Tampa, FL

Northrop Grumman Technical Services CAGE 0RJC1, Herndon, VA

REDCO CAGE 7SEQ7, Mission, SD

L2 Aviation CAGE 4JRP3, Dripping Springs, TX

Apogee Worx, LLC CAGE 7KKF3, Ogden, UT

The above vendors expressed interest in this effort. The government's assessment is that the only company capable of meeting the entire requirement is Collins Aerospace. All other companies did not have access to the required proprietary data, failed to provide a viable solution, or were only interested in subcontracting opportunities. The market research provides additional details.

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.

As a result of the continued refusal by the sole source contractor to provide or license data as well as the duplication of cost of developing additional sources per Sections V and IX, there are no known additional actions which can be taken to remove barriers to competition and therefore, specific actions and milestones cannot be established.

Per PGI 206.304(a)(S-70) - As indicated by signature on the Coordination and Approval Document, the previous

J&A has been reviewed and the Approval Authority determines that all stated actions to remove barriers to competition have been accomplished. This is a follow-on contract to the Engineering, Manufacturing and

Development (EMD) activities for production of the Mode 5/ADS-B system, a major system. The Mode 5 program is a modification of the KC-10 Communication, Navigation, and Surveillance Air Traffic Management

(CNS/ATM) system. The KC-10 CNS/ATM suite is a highly specialized and safety-critical avionics and navigational system consisting of several million lines of Collins Aerospace proprietary code interfacing with multiple other sources within the KC-10 Avionics suite.

XII. Certification by the Contracting Officer.

The contracting officer's signature on the Coordination and Approval Document evidences that he has

FOR OFFICIAL USE ONLY March 2018 Page 7 of 7 determined this document to be both accurate and complete to the best of his knowledge and belief.

XIII. Certification by the technical/requirements personnel.

By their signatures on the Coordination and Approval Document, the technical and/or requirements personnel have certified as accurate and complete all supporting data, which is their responsibility, contained herein IAW FAR

6.303-2(c).

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