JA_Honeywell_-_redacted1.pdf

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

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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.

Choose the funding level for this J&A Document:

< $700K > $700K and < $13.5M > $13.5M and < $93M > $93M

Contracting Activity: AFMC OL:H/PZA

Purchase Request / Local ID Number: TEMP-3559206

Program / Project (and PE, if applicable): Engineering Support for Secondary Power Systems

Program Type (PEO or Other Contracting): Other Contracting

Authority (include full title): 10 U.S.C. 2304 (c) (1), as implemented by FAR 6.302-1

Estimated Contract Cost (including options): $12,000,000.00 J&A Type: Class Individual

COORDINATION (AFFARS 5306.304(a) )

Date

12 Jan 2017

Contracting Officer Matthew Anderson

OL:H/PZABA / 801-777-6502

Signature

Date

14 Nov 2016

Project Lead / Program Mgr / Requiring Activity Tyrell Philpott

419 SCMS/GUEA / 801-586-2845

Signature

Date

12 Jan 2017

Local Legal Reviewer Michael Bassett

75 ABW/JA / 801-586-4191

Signature

APPROVAL (AFFARS 5306.304(a) )

Date

31 Jan 2017

Competition Advocate Kevin Flinders

AFMC OL_H/PZC / 801-777-6549

Signature

PHILPOTT.TYRELL.G.12

73598614

Digitally signed by PHILPOTT.TYRELL.G.1273598614 DN: c=US, o=U.S. Government, ou=DoD, ou=PKI, ou=USAF, cn=PHILPOTT.TYRELL.G.1273598614 Date: 2016.11.14 14:49:29 -07'00'

ANDERSON.MATTHEW

.STEVEN.1158523066

Digitally signed by ANDERSON.MATTHEW.STEVEN.1158523066 DN: c=US, o=U.S. Government, ou=DoD, ou=PKI, ou=USAF, cn=ANDERSON.MATTHEW.STEVEN.1158523066 Date: 2017.01.12 09:29:19 -07'00'

BASSETT.MICHAEL.D.1

406950111

Digitally signed by BASSETT.MICHAEL.D.1406950111 DN: c=US, o=U.S. Government, ou=DoD, ou=PKI, ou=USAF, cn=BASSETT.MICHAEL.D.1406950111 Date: 2017.01.12 10:59:32 -07'00'

FLINDERS.KEVIN.G.123

1477949

Digitally signed by FLINDERS.KEVIN.G.1231477949 DN: c=US, o=U.S. Government, ou=DoD, ou=PKI, ou=USAF, cn=FLINDERS.KEVIN.G.1231477949 Date: 2017.01.31 14:21:58 -07'00'

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I. Contracting Activity.

United States Air Force 6050 Gum Lane, Bldg 1215 Hill AFB UT 84056-5825 Contracting Officer: Matthew Anderson Office Symbol: OL:H/PZABA Phone Number: 801-777-6502

PR#: TEMP-3559206

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 follow-on contract to FA8208-07-D-0002 which will be a requirements type contract for research & development, including prototypes and engineering services to support redesign, study and analysis of secondary power systems (SPS) gearboxes, Auxiliary Power Units (APU), Jet Fuel Starters (JFS), Oil Pumps, Fuel Controls etc. for multiple weapon systems to:

Honeywell Defense & Space

111 S. 34th Street

Phoenix, AZ 85034

CAGE Code: 99193

B. Contract Type & Structure: A follow-on 5 year base requirements contract with two 1.5 year options for research & development and engineering services where the contractor will provide redesign efforts, reliability improvements, continuing expert operational, technical, and engineering support for secondary power systems. This effort will be for the secondary power systems on identified weapon system platforms. The estimated dollar value is $12M. Other military services (Navy, Army, Coast Guard) that have a similar engineering need may use this contracting vehicle if applicable. It is anticipated to be a cost plus fixed fee pricing term and will be issued under an IDIQ type of arrangement. The estimated award date is 1 March, 2017. No orders will be issued on this contract after Feb 2025.

Performance will end upon completion of the last delivery order with an estimated schedule of 1 year after issue of order.

C. Type J&A: Individual

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

A. This contract will provide research & development, continuing sustainment, engineering efforts, technical data, drawings, change proposals, manpower support, design activities, prototype hardware, testing, product and procedure improvements, reports, etc. for secondary power systems on the F-16 (Turbine Power Unit), F-15, B-1, A-10, E-3, B-2, C-130 (including start carts), C-5 and other potential weapon systems which are proprietary to Honeywell . The Air Force platforms will be funded under Component Improvement Program (CIP) 3600 appropriations which are research and development funds. Other defense agencies will use research and development appropriations that may be numbered differently depending upon the agency. The anticipated CLIN structure is as follows:

CLIN 0001 Technical Services SCLIN 0001AA Engineering Services SCLIN 0001AB Research & Development SCLIN 0001AC Data

The estimated yearly totals are as follows:

Year Estimated Total (M) 1 $.750 2 $.750 3 $2 4 $2 5 $2 6 $2 7 $1.5 8 $1 Total $12M

B. The CIP program approves funding in one year installments, depending upon the complexity of the project. There will be multiple weapon systems that require redesign efforts and other engineering activity.

C. The funding is for more than 1 year as there are no feasible actions that can be taken during the period of performance of the proposed contract.

D. The estimated award date is 1 March, 2017. No orders will be issued on this contract after Feb 2025. Performance will end upon completion of the last delivery order with an estimated schedule of 1 year after issue of order.

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IV. Statutory authority permitting Other than Full and Open Competition.

10 USC 2304 (c) (1) as implemented by FAR 6.302-1, Only One Responsible Source and No Other 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).

A. The secondary power system provides starting power for propulsion engines and hydraulic & electrical power during flight depending on the aircraft. When the propulsion engines reach self-sustaining speed, the startup power in the SPS engine is turned off. There are components of the SPS that continue operating during flight; these are either Aircraft Mounted Accessory Drive (AMAD) gearboxes or Accessory Drive Gearboxes (ADG).

Engineering services for secondary power systems is highly specialized because of the following:

• Strict requirements and high precision for flightworthy, aircraft components

• Complex manufacturing techniques for small turbine engine components

• Intricate details of design and manufacturing of aircraft gearboxes

• Specialized testing and test criteria

• Possession of proprietary data for aircraft interface details

• Possession of proprietary data for part details for redesign efforts

• Experience with military airworthiness requirements

The government has identified these as Key Performance Parameters that any vendor should have in order to possess the capability to provide the services required. Therefore, this acquisition is for the development of highly specialized aircraft parts and for performance of a highly specialized engineering service.

B. Honeywell is the Original Equipment Manufacturer (OEM) of the secondary power systems of specified weapon systems. Honeywell developed at their own expense, the secondary power technology many years ago and is the only approved source for the specified aircraft. Honeywell is the only source that has the necessary data and existing engineering resources to redesign, provide reliability improvements and provide the required services for the specified aircraft. They are the only source which owns the highly specialized design, configuration, manufacturing, production and process data. They have the unique

Page 5 of 8Updated: 15 Mar 16 and highly specialized equipment required for analysis, testing and production. They also have the engineering personnel with extensive experience that have designed and built power systems hardware.

C. The government currently has limited use rights to SPS data on legacy aircraft for which Honeywell is the OEM of. This data is not sufficient to allow for this to be a competitive acquisition. This data is used for procurement, form, fit, function and overhaul & repair actions. The government does not have adequate rights for competitive acquisition.

Honeywell owns the data and rights necessary for engineering and production. The government requested on May 2, 2016, if Honeywell would sell data rights which would allow the government to compete this. Honeywell officially responded on May 10, 2016 by declining to sell the rights to the government. This data is required for the engineering services, design, and prototype production which will be required by this contract.

D. The 419 SCMS/GUEA Engineering Group believes that award to any other source would result in substantial duplication of costs to the Government that is not expected to be recovered through competition. Based off of future task list costs it is estimated that an extra $8.6M would be necessary for any vendor outside the OEM to perform the requirements of this highly specialized engineering services contract. The added costs are mostly from data inadequacies and the cost to reverse engineer mating hardware.

E. Accordingly, Honeywell is the only firm currently capable of providing the supplies and services described in Section III above without the U.S. Air Force experiencing substantial duplication of costs in fulfilling its requirements.

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

A. Sources Sought Synopsis:

The sources sought synopsis (SSS) was issued IAW FAR 5.201 on May 3, 2016. Its solicitation number is FA8251-16-ENGSPS. The closure date was June 2, 2016. Its purpose was to help in conducting market research to determine if responsible sources exist and to assist in determining if this effort can be competitive and/or a total Small Business Set- Aside.

There was one response to the SSS, other than Honeywell:

A company called SAMMS LLC contacted the USAF regarding the SSS. His interest was in the IDIQ contract to create a condition based maintenance (CBM) program for the secondary power systems that Honeywell is the OEM for. It was explained to them that this contract is not for CBM and the weapon system program offices would be the groups to engage for that kind of work. They were given some POCs at a couple different program

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B. This requirement will be synopsized in FEDBIZOPPS as a notice of contract action IAW FAR 5.201.

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

A. 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 Contracting Officer will obtain certified cost or pricing data IAW FAR Subpart 15.403,--when/if required. Should individual contract items later be determined to be commercial in nature as defined in FAR 2.101, the contracting office will obtain other than certified cost and pricing data IAW FAR Subpart 15.403-3. 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 IAW FAR Part 10, was conducted by synopsis of the proposed acquisition, advising industry of the pending acquisition and soliciting inquiries from interested parties.

B. Further market research was conducted by internet searches for aircraft related secondary power systems. The market research showed that there are a few companies that have experience with design, manufacture, sustainment, test, and supply chain activities for similar type of hardware. The companies identified with this experience were Honeywell, Pratt & Whitney, GE Aviation, R&D Dynamics Corporation, US Microjet LLC, and Triumph Group Inc. The research shows that the commercial marketplace has very few vendors for distribution, and no commercial services are available that can satisfy the government requirements. The vendors were evaluated on a list of key performance requirements (KPR) necessary to qualify for the required services of the aircraft listed above. All of the vendors were deficient in one or more KPRs and did not have capability, except Honeywell.

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C. IAW FAR part 10 market research/surveillance was performed. Acquisition specific market research was performed by engineering from 419 SCMS. The market research strategy focused on gathering information to determine if commercial items or non-developmental items are either available or can be modified to fit the requirements. No commercial items or non-developmental items were found that will meet the government's needs. It was also used to help identify potential sources for this acquisition. The only viable source identified was Honeywell .

D. No organic capability exists for this Engineering Services and R&D effort.

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

NONE

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

See Section VI

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.

This contracting action will provide research & development and engineering services for secondary power systems. The expectation is that the government will have continued need for this type of engineering service and R&D efforts after this contract closes. A qualification requirement in accordance with the government Key Performance Requirements will be developed during these 8 years and posted periodically to possibly provide for competition in the future, if required. The government will also continue to attempt to procure the data from Honeywell.

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.

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