justification_and_approval_SmartBlend_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 1 of 4

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! )

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

Funding level for this acquisition:

Contracting Activity: AFSC/PZIM

Purchase Request / Local ID Number: Serv 19-001

Program / Project (and PE, if applicable): SmartBlend Preventive Maintenance and Remedial Maintenance Services

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

19 Sep 2018

Program Mgr / Requiring Activity

OC-ALC/OBCA 405-734-1062

Signature

APPROVAL (AFFARS 5306.304(a) )

Date

19 Sep 2018

Contracting Officer David W. Herrig

AFSC/PZIMC 405-739-5819

Signature

HERRIG.DAVID.W.11399

58795

Digitally signed by

HERRIG.DAVID.W.1139958795

Date: 2018.09.19 13:30:15 -05'00'

March 2018 FOR OFFICIAL USE ONLY Page 2 of 4

I. Contracting Activity.

Department of the Air Force

AFSC/PZIMC

3001 Staff Dr, Ste 2S76 Tinker Air Force Base, OK 73145-5990

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

The 76 PMXG requires a multi-year maintenance service contract that includes the Preventive Maintenance (PM) and Remedial Maintenance (RM) of the SmartBlend System (SBS). The SBS is a Non-Destructive Inspection (NDI) system that uses harmonics to measure the disturbance caused by blending Integrally Bladed Rotor (IBR) blades used in the F119 jet engine. This equipment is used in a partnership with the F119 Systems Program Office (SPO) and F119 engineering group to help make data-driven decisions on the blend limits for IBR blades. This program has the potential to save the Air Force thousands of dollars by preventing unnecessary condemnation of IBR's. The equipment is new, highly-specialized non-commercial technology that is in constant review and development. Since it has been placed into service at Tinker AFB, the Air Force agencies participating in its development have directed 76 PMXG to purchase a maintenance agreement from the system's manufacturer. The maintenance service contract will ensure that the equipment is operational and ready to serve the Air Force's needs. It will also produce reports from tests that will be used to build a database of IBR inspection responses. This is a first-time purchase and will be a sole source award, with one base year and two option years, to Blade Diagnostics Corp of Pittsburgh, PA (CAGE 332B2). Estimated Period of Performance is 1 Nov 18 - 31 Oct 22.

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

This acquisition will be a new three (3) year Non-Commercial, Firm Fixed Price purchase order awarded using simplified procedures at FAR 13. Funding will be from 4930 Working Capital (Non-expiring) funds.

Contract Summary

YEAR Quantity Unit Price Estimated Dollars Estimated Period of Performance Basic CLIN 0001 PM/RM 1 lot 1 Nov 19 - 31 Oct 20 CLIN 0002 Reports (Data) 1 lot 1 Nov 19 - 31 Oct 20 CLIN 0003 Spare Parts 1 lot 1 Nov 19 - 31 Oct 20 Option I CLIN 0001 PM/RM 1 lot 1 Nov 20 - 31 Oct 21 CLIN 0002 Reports (Data) 1 lot 1 Nov 20 - 31 Oct 21 Option II CLIN 0001 PM/RM 1 lot 1 Nov 21 - 31 Oct 22 CLIN 0002 Reports (Data) 1 lot 1 Nov 21 - 31 Oct 22 52.217-8 Option CLIN 0001 1 lot 1 Nov 22 - 31 Mar 22 Total

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

The statutory authority for this action is 10 USC 2304(c)(1) as implemented at FAR part 6.302-1(a)9@)(iii), Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

March 2018 FOR OFFICIAL USE ONLY Page 3 of 4

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

BDC is the OEM (Original Equipment Manufacturer) for the Smartblend machine. As the OEM, BDC has the experience, equipment and training to be able to perform service on the Smartblend machine. The system relies heavily on software developed and patented by BDC. BDC retains the data rights for the software that operates this highly specialized, LASER-guided machine. They send company-trained technicians to service the Smartblend machine. They have no authorized service partners and will not license or sell their data to a third party repair source. This acquisition is for performance of a highly specialized service. The Government does not have the data rights to accomplish repair and maintenance of the equipment. The Government does not have the source code data such as machine parameters and machine original specifications. Operation and performance of the machine are monitored via computer at BDC's main office in Pittsburgh, PA. From there, reports are generated that need to be reviewed by 76 PMXG representatives to assess IBR airworthiness and effectiveness of this new NDI technology. Award to any other source would result in inadequate maintenance of the system and lead to loss of machine serviceability and unacceptable delays in fulfilling the requirements of the Air Force. A non-OEM source would need to subcontract to the OEM to get data rights, which could lead to duplication of effort, and potential increase subcontracting costs and delays. The anticipated extra costs would run between 10-15% of the estimated price, resulting in approximately $60,000-$65,000 in extra costs to the Government. Award to another source would also eliminate the report data that is crucial to monitoring machine performance and effectiveness as only BDC has the ability to collect this data based on their wholly-owned software. Accordingly, BDC is the only firm capable of providing 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.

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

A Sources Sought Synopsis (SSS) was published on Federal Business Opportunities (FBO) along with the draft Performance Work Statement (PWS), from 15 Jun 18 to 29 Jun 18. No responsible companies responded to the notice.

The lack of responses, along with market research, support the sole source nature of this requirement.

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

The Contracting Officer will ensure that 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 Other than Certified Cost or Pricing Data. A detailed price analysis will be performed.

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

The Smartblend system is a new, one-of-a-kind system developed by BDC in collaboration with Air Force Research Laboratory (AFRL). It is Non-commercial in nature and there are no other non-government entities operating with the same type of technology for NDI applications. Market Research was performed by reviewing a past Capital Infrastructure Program (CIP) contract for the development of this equipment as well as past invoicing for repairs and parts. The Small Business Administration's Dynamic Small Business Search system was also consulted along with a review of GSAAdvantage! for the existence of other developers or contracts for this type of equipment. No companies or contracts were found that correlate with this effort.

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

N/A

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

Blade Diagnostics Corporation (BDC) 2730 Murray Ave Pittsburgh, PA, 15217-2420

POC:

PH:

Email:

CAGE Code: 332B2

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.

Because BDC exclusively retains ownership of proprietary data and rights and is unwilling to license or sell those rights, and the duplication of costs resulting from attempts to reverse engineer or develop in-house capabilities, there are no known additional actions which can be taken to remove barriers to competition;

therefore, specific actions and milestones cannot be established.

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 signature above, I certify that any supporting data contained herein, which is my responsibility, is both accurate and complete.