T-38_PC_III_Industry_Day_Briefing_21_May_2014.pdf

AFLCMC… Providing the Warfighter’s Edge

T-38 Pacer Classic III

(PC III)

Industry Day

21 May 2014

AF Life Cycle Management Center

Disclaimer

• NOTHING STATED IN THIS BRIEFING OR RELATED

DISCUSSIONS IS CONTRACTUALLY BINDING. ALL

COMMUNICATIONS OR INFORMATION WHICH

PERTAINS TO THIS EFFORT IS FOR DISCUSSION

PURPOSES ONLY.

• ANY OFFEROR COSTS INCURRED PRIOR TO

RECEIPT OF A CONTRACT SIGNED BY THE

GOVERNMENT CONTRACTING OFFICER ARE THE

RESPONSIBILITY AND RISK OF THE OFFEROR.

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Agenda

• Administrative Items

• Ground Rules

• Introductions

• Program Overview – Ms. Staci Draney

• Systems Engineering – Mr. Matthew Morgan

• Contract Strategy – Mr. Russell Walter

Administrative Items

• Facilities

– Refreshments

– Restrooms

– Phones

– Smoking

• Emergency procedures

– Emergency exits

– Shelter in Place

Ground Rules

• During Industry Day

– Questions regarding briefing and draft requirements documents are encouraged

– One-on-one meetings will be 50 minutes

• Post Industry Day

– Direct questions to the Contracting Officer and Buyer

– Notes and non-proprietary questions and government responses will be posted to FedBizOpps

Introductions

Program Overview

Staci Draney Lead Program Manager

Objectives

• Conduct market research and provide industry with an overview of the T-38C PC III program

• Exchange information prior to Request For Proposal (RFP) release (Jul 14)

• Provide a clear understanding of the requirements

• Understand industry concerns, risks and receive feedback prior to RFP release

Today’s information may change based on feedback

Background

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• Replaces known life-limiting components

• Ensures structural integrity of 125 T-38C aircraft at high risk of grounding

• Depot-level modification program

– Installations performed by T-38 depot at Randolph AFB

• Phase I kits = sole source to NGTS for 51 kits

• Phase II kits = competitive effort for remaining 74+

• Tech Data & Engineering Services - NGTS

• Installation Tooling Design & Fabrication - NGTS

Structural Components

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100% Parts

Select Structural Components

Note:

Numerous PCIII skins not labeled for clarity

Requirements

• PC III Contract Shall Provide:

– Parts manufacturing and procurement

– Program management and kit integration

– Risk management and quality assurance

• Scope

– Up to 74+ kits

– 5 year ordering period; 6 year delivery period

• Estimated Contract Award (Jan 2015)

Evaluation Sub Factors

• Parts Manufacturing & Procurement Plan

– Manufacturing Parts

– Procuring Parts

• Drawing Interpretation

– Ability to interpret drawing

• Program Management and Kit Integration

– Supply chain management approach

– Detailed IMS from Contract Award to Final

– Organizational structure and sub contractors Risk

Management & mitigation process and methods

– Quality assurance(e.g. AS9100)

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Engineering

Matthew Morgan T-38 Aerospace Engineer

Engineering Technical Overview

• T-38 Engineering Source Authority (ESA) Roles

– Provide Technical Data Packages (TDP) clarification

– Waiver/deviation approval/disapproval

• Responsibilities

– Bill of materials

– TDP

– Source qualification

– Specialized tooling (forging and extrusion dies) for source directed parts

Engineering Bill of Materials

• Modification Impacts Entire Fuselage

• Key Components (35 Major)

– 10 longerons

– 10 bulkheads and formers

– 7 floors /floor assemblies

– Attaching hardware (130+ total Parts)

Engineering Technical Data Packages

• JEDMICS Disc

– Current configuration drawings

• Engineering Data List (EDL)

– Applicable drawings

– Engineering orders

• Attachment A

– Special instructions

• Source Qualification Statement

– Applicable Critical Safety Items (CSI)

Engineering Attachment A

• Special Instructions

– Necessary hole omissions

– Marking and identification

– Unique inspections

– Unique manufacturing processes

• Source

– Direct / Proprietary

– Qualified

Engineering

Source Qualification Statement (SQS)

• CSI

• Qualification Article

• Types of Waivers

– Qualified on the right or left-hand article

– Provided earlier dash numbers of a basic part number

– A similar or like item (complete set of drawings for the similar item, successful first article test completion report, and other documentation)

– The ESA is the final approval authority

• Contract Award will not be Delayed

Engineering Manufacturing

• Forging/Extrusion Tooling

– Forging/Extrusion house has dies (current production)

– Need to coordinate quote and lead time

• Check Fixtures and Other Tools

– Tool availability is unknown (current production)

– Coordination required

• First Article Test

– Required without approved waiver

• Parts Production Lead Time

– Not to exceed 12 months (including all processes)

Contract Strategy

Russell Walter

Contracting Officer

Total Evaluated Price

• Proposed pricing will be evaluated using a Total

Evaluated Price (TEP)

– Established to determine the lowest priced offeror

• TEP includes the following CLIN pricing:

– FFP CLINs 0002 - 0012: Individual PC III Aircraft

Modification Kits (each calculated using most likely order volume at proposed quantity break pricing)

– FFP CLIN 0013: PC III Supplemental Kits (calculated using proposed labor rates multiplied by notional hours for recurring engineering)

– FFP CLIN 0015: PC III Non-Recurring Engineering

• All CLIN Pricing will be evaluated for Balance and

Reasonableness

• The following CLINs are not included in TEP:

– FFP CLINs 0001: Overarching PC III Aircraft

Modification Kit, comprised of kits from CLINs 0002 -

– Not Separately Priced CLIN 0014: PC III Data

Total Evaluated Price Cont’d

Program Timeline

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MILESTONE DATE

Industry Day Today Release Synopsis May 14 Request for Proposal Jul 14 Proposals Due Sep 14 Contract Award Jan 15 Post Award Conference Feb 15 Contract Start Feb 15

Dates Subject to Change

• Single Prime Contractor with Overall Kit Integration

• 100% Small Business Set Aside

• Contract Type: Firm Fixed Price (FFP)

• Lowest Price Technically Acceptable (LPTA)

Summary

Summary

• Program Overview

– Parts manufacturing and procurement

– Program management and kit integration

– Risk management and quality assurance

• Systems Engineering

– Source qualification will not delay contract award

• Contract Strategy

– 5 year ordering period; 6 year delivery period

– 100% small business

– Firm fixed price

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Questions

Small Business Set-Asides for Manufactured Items

S. Brent Owens, Procurement Center Representative

U.S. Small Business Administration Office of Government Contracting

(801) 775-4141 brent.owens@hill.af.mil http://www.sba.gov/index.html

Overview

• What is a Small Business

• Small Business Set-Asides

• Manufacturer vs Non-Manufacturer

• Kit Assemblers

• Ostensible Subcontracting

Small Business Definition

• Organized for profit

• Place of Business in the U.S., operates primarily in the U.S., or makes a significant contribution to the U.S. economy (taxes, use of American products/labor)

• Does not exceed the small business revenue or employee size standard for the procurement (including affiliates)

– Each North American Industrial Classification System

(NAICS) code has a small business size standard

NAICS Codes and Size Standards

NAICS Description Revenue (M) # employees 325920 Explosives 750 237990 Construction $33.5 541330 Engineering $35.5 326220 Hoses 500 334310 Video Equipment 750 336413 Other Aircraft Part/Aux Equip Manuf. 1000 336411 Aircraft Manufacturing 1,500 http://www.sba.gov/size

Average Annual Receipts

• Use Federal Tax Returns

• Cost of Goods Sold plus Total Income

• Average of last three completed fiscal years

Number of Employees

• Count all individuals employed on a full-time, part-time, or other basis. This includes employees obtained from a temporary employee agency, professional employee organization or leasing concern.

• Numbers of employees for each of the pay periods for the preceding completed 12 calendar months(running average).

• Payroll records/IRS Form 941

SBSA --“Rule of Two”

$3,000 - $150,000 “Automatically reserved exclusively for small business…”

Over $150,000 “Shall be set-aside for small business when there is a reasonable expectation that:

(1) offers will be obtained from at least two responsible small business concerns…

(2) award will be made at fair market prices…”

“Responsible”

• Adequate financial resources*

• Comply with delivery schedule

• Satisfactory past performance

• Integrity

• Technical Skills*

• Necessary Equipment*

• Compliance with “Limitation on Subcontracting”

• *(or the ability to obtain)

FAR 9

Limitations on Subcontracting

• Applies to full or partial small business set-aside contract, an 8(a) contract, a WOSB or EDWOSB

• Supplies: 50% cost of manufacturing excl mat’l

• Services: 50% with its own employees

• General Construction: 15% with its own employees

• Specialty Construction 25% with its own employees

13 CFR 125.6

Manufacturer (for SBSA)

• A concern which, with its own facilities, performs the primary activities in transforming inorganic or organic substances, including the assembly of parts and components, into the end item being acquired

• End item must be manufactured or produced in the United States

• Must be small within the size standard of the assigned NAICS code

• Must comply with the Limitation on Subcontracting

– 50% of the cost of manufacturing, excluding materials

Non-Manufacturer Rule (for SBSA)

• An exception to the performance requirements (Limitations on Subcontracting)

• A non-manufacturer may qualify as a small business on a supply contract set aside for small business if:

– Will supply the item of a small business manufacturer

– Does not exceed 500 employees

– Is primarily engaged in the business

– Takes ownership of item consistent with Industry

Non-Manufacturer Rule Waivers

• The requirement that a non-manufacturer supply the product of a small business concern may be waived by the SBA when there are no small business manufacturers available to supply the item to the government

• Waivers are identified on NAICS codes and GSA’s Product and Service Codes (PSC)

• Listing of Waivers: www.sba.gov

• All other requirements of NMF Rule apply http://www.sba.gov/

SBSA for Kit Assemblers

• Kit Assemblers:

– Manufactured item is a kit of supplies…for a specific purpose

– Small Business cannot exceed 500 employees

– 50% of the total value of the components of the kit must be manufactured by Small Business in the US (applicable to NAICS code for item). Specified items from large business excluded from calculation

– The offeror need not itself be the manufacturer of the items assembled

Ostensible Subcontracting

• A subcontractor is an ostensible subcontractor if:

– The subcontractor performs the primary and vital requirements of the contract, or

– The prime contractor is unusually or unduly reliant upon the subcontractor

• A contractor and its ostensible subcontractor are treated as joint ventures, and therefore affiliates, for size determination purposes

Red Flags

• Firms identified as a team

• Incumbent’s project management employees being hired by prime contractor

• Significant portions of contract being subcontracted to the incumbent

• Discrete taskings between prime and subcontractor not identified

• Subcontractor has the required past performance experience and qualifications in the primary and vital taskings

Size Protests

• Can be initiated by any interested party:

– Unsuccessful Offeror

– Contracting Officer

– SBA

– Other Interested party (large business, where only one concern submitted an offer for the procurement)

• Can only be initiated against the apparent successful offeror

• Formal Size Determinations by SBA can be appealed to the OHA

Regulations

• 13 Code of Federal Regulations 121.402; 406; 1204; 125.6

• FAR Part 19.102; 502