Turbine_and_Gear_JA-21_May_2019_(003)_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 2 of 5

I. Contracting Activity.

United States Air Force

OL:H/PZABA

6050 Gum Lane, Bldg 1215 Hill AFB, UT 84056-5825 Contracting Officer: Patrick Jurkiewicz Phone Number: DSN 775-6535 PR Number: FD2020-1901001

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

A. Upon approval to use other than full and open competitive procedures, the Government will issue a new follow-on non-commercial spares contract to procure 134 Turbine & Gear, Matched Set NSN 3020-01-054-1271 for the F-16 Auxiliary Drive Gearbox (ADG) used by the US Air Force and FMS customers. A previous contract was awarded on a sole source basis to UNICAL Aviation under contract FD2020-17-00916 on 8 November 2018 with deliveries made Jan 2020 through May 2020.

The contract will be awarded to:

UNICAL Aviation Inc.

680 S. Lemon Avenue City of Industry, CA 91789-2934 CAGE Code 7CNG1

OR

Hamilton Sundstrand (DBA Collins Aerospace) 4747 Harrison Ave.

Rockford, IL, 61108-7929

CAGE 99167

B. The estimated dollar value of this acquisition is A Firm-Fixed-Price (FFP) pricing arrangement is anticipated. The estimated award date is Aug 2019. The period of performance is expected to conclude in Dec 2020.

C. Type: Individual

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

A. This is a new follow on non-commercial stand-alone spares contract to purchase F-16 Turbine & Gear, Matched Sets which are installed in the F-16 accessory Drive Gearbox (ADG) sustaining the F-16 Secondary Power Systems.

B. The Air Force estimated unit price, quantity, and extended price are shown below:

LINE NSN Item Qty Cost Est Total 0001 3020-01054-1271 Turbine & Gear, Matched Set 134

C. Total estimated cost is Sufficient pricing data, procurement history, and performance data are available from D200A requirements system to come up with a realistic forecast. The contracting action will use 4930 CSAG-S Working Capital Funds. We are seeking approval for more than one (1) FY since the period of performance will cross fiscal years (FY19 and FY20).

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

10 USC 2304(c)(1), as implemented by the Federal Acquisition Regulation (FAR) 6.302-1(a)(ii), Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

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

A. The above authority was selected because the requirement is for the acquisition of highly specialized assets. The F-16 Gear Spur is a component generally termed as Turbines and Gears Assembly that is highly specialized equipment of the F-16 Accessory Drive Gearbox (ADG) gear train. The ADG supplies hydraulic and electrical power during F-16's flight operation. Additionally, the F-16 ADG is unique only to the F-16 aircraft. It is a complex gearbox which distributes power from the F-16 Jet Fuel Starter (JFS) over to the main engine. Upon start up of the main engine, the JFS shuts down and redistributes power from the engine to the hydraulic pumps and IDG all connected to the ADG. Internally, the torque converter is a three element assembly of fixed geometry designed to be constantly filled with oil which serves as its working medium. The torque converter provides transmitting torque from the JFS to the aircraft engine during start up of the ground motoring. The F-16 Gear Spur is unique to the F-16 aircraft with a total of 1 each per aircraft. Therefore, this acquisition is for the supply of highly specialized assets.

B. The Original Equipment Manufacturer (OEM), Hamilton Sundstrand (Cage Code 99167), owns the data rights to the F-16 Gear Spurs and has licensed UNICAL to be the sole vendor. The Government has made multiple attempts to obtain the data rights from the OEM but has only been successful in obtaining limited rights to perform minor repairs. The most recent attempt was in December 2018. The Government e-mailed a letter to UNICAL Military Customer Support Manager to inquire whether they would be willing to sell or license the data required for the Government to conduct a competitive procurement for the required parts. UNICAL responded that they are not willing to sell or license the required technical data for a competitive procurement to the Government at this time.

C. The 419th SCMS believes that award to any other source other than UNICAL or Hamilton Sundstrand would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and would cause unacceptable delays. The Government estimates the cost to reverse engineer the F-16 Spur Gear, including cost of equipment, development of special testing requirements, software development for the test equipment, and creation of technical drawings would be . Based on an estimated Annual As-Is value of and an annual To-Be value of the break-even calculation results in 35.16 years to achieve a return on investment on the upfront reverse engineering costs, even factoring a 2% annual cost savings. The airframe is anticipated to operate until 2041 (24 more years), which results in a projected loss of over the life of the airframe. The Government anticipates a reverse engineering project would take 3 years to complete based upon the time to perform the engineering study, manufacture, and test the reverse engineered Turbine and Gear.

D. Accordingly, UNICAL Aviation Incorporation (CAGE Code 7CNG1) or Hamilton Sundstrand (CAGE Code 99167) are the only firms capable of providing the supplies described in Section III above without the Government experiencing substantial duplication of cost that could not be expected to be recovered through competition and unacceptable delays in fulfilling its requirement.

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

A. Sources Sought Synopsis: A sources sought synopsis titled "Turbine & Gear, Matched Set was issued 28 Oct 2018 and closed 5 December 2018. The synopsis outlined the Governments intent to procure additional F-16 Turbine and Gear, Matched Sets.

B. No response was received from the Sources Sought Synopsis

C. Synopsis - This requirement will be synopsized in http://www.FEDBIZOPS.gov as a notice of proposed contract action

IAW FAR 5.201

D. Other Actions: After the SSS closed, Viranim contacted the Government and stated that they were potentially interested in reverse engineering the F-16 Turbine & Gear, Matched Set. The Government is developing a source qualification document to provide to the company to outline the requirements to become qualified if the company decides to reverse engineer this part.

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However, due to the expected duration required to reverse engineer the Turbine and Gear and for the qualification process, this Viranim would not be capable of meeting the Governments needs for this procurement. The Government estimates that it will take 3 years to reverse engineer and qualify this part.

E. Qualifying Country Sources: None

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

The following steps will be taken to ensure that the anticipated cost of this acquisition will be fair and reasonable. The Contracting Officer will comply with the procedures and criteria contained in Federal Acquisition Regulation (FAR) under Part 30 - Cost Accounting Standards, Part 31 - Contract Cost Principles and Procedures, Subparts 15.4 - Contract Pricing;

to include technical evaluations and audits, as appropriate. Additional steps to ensure price reasonableness will be under the guidance of the Contract Pricing Reference Guides, jointly developed by the Federal Acquisition Institute and the Air Force Institute of Technology. The Final Step is to include the Price Negotiation Memorandum (PNM). This detailed documentation and justification of price reasonableness will be disclosed in the official PNM, to be prepared upon completion of negotiations.

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

A. As described in Section VI above, market research, in accordance with FAR Part 10, has been conducted by synopsis of the proposed acquisitions, advising industry of the pending acquisition and soliciting inquiries from interested parties.

B. In accordance with FAR part 10, and in addition to ongoing market surveillance by the integrated product team, acquisition specific market research has been conducted by the 419th SCMS on 25 October 2018. This market research consisted of a review of commercial catalogs, company literature, proprietary data rights and individual experience was initiated by IPT members. The integrated product team also reviewed the procurement history for this item, which only identified Hamilton Sundstrand as being the only manufacturer utilized for the procurement of this item. The Engineer also conducted searches of ThomasNet.com and Google. No new sources or commercially-available alternative parts were found as a result of this search.

C. Market research concluded that there are no alternate/additional sources capable of meeting the government's requirement at this time and UNICAL Aviation Inc. (CAGE CODE 7CNG1) is the only known company capable of satisfying the government requirements.

D. The F-16 Turbine and Gear, Matched Set is unique to the F-16 fighter aircraft and does not have commercial off-the shelf sources of manufacture. No commercial or non-developmental items are available with similar form, fit, or function parameters that can be used or modified to satisfy the agency's need.

E. The government does not have the organic capabilities to manufacture the turbine and gear. The government does not own the data rights to the turbine and gear and therefore does not have authority to manufacture this component without authorization from the OEM.

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

No Further Information

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

See section VI above.

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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.

Actions to increase competition on this acquisition will be performed by 419 SCMS and will ensure the following tasks are accomplished per the milestones established. The Government will post a sources sought synopsis to see if any other vendors are capable of producing these assets. Additionally, the Government will continue to attempt to procure appropriate data rights. Each action will be performed prior to executing a requirement, and will be evidenced through documentation in the contract file e.g. SSS, RFIs, e-mails to contractor, etc.

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.

XII. Certification by the Contracting Officer.

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