Post_J&A_Redacted.pdf

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

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: AFLCMC/WLNKA

Purchase Request / Local ID Number: FD2060-16-93540

Program / Project (and PE, if applicable): In-flight Propeller Balancing System (IPBS) Component Certification

Program Type (PEO or Other Contracting): PEO

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

Estimated Contract Cost (including options): $1,500,000.00 J&A Type: Class Individual

COORDINATION (AFFARS 5306.304(a) )

Date

06 Apr 2016

I. Contracting Activity.

This Justification and Approval to request authority for Other than Full and Open Competition supports requirements generated for the Air Force Life Cycle Management Center (AFLCMC)/WLNCC. The contracting activity for this requirement is AFLCMC/WLNKA, Robins Air Force Base, Georgia. The Purchase Request Number is FD2060-16-93540.

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

Due to the circumstances described herein, the activity requests authority to acquire the services listed in this document using other than full and open competition as prescribed in FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. The proposed sole source action will result in the award of a new Firm Fixed Priced (FFP) basic contract. Travel will be included on a Cost Reimbursement No Fee basis. The proposed sole source action will be awarded to the following company:

LORD Corporation 111 Lord Drive Cary, NC 27511-7923

CAGE 9J509

Large business

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

The services required are available only from LORD Corporation, the Original Equipment Manufacturer (OEM), for this follow-on contract for the continued development of the C-130H In-Flight Propeller Balancing System (IPBS). Under this new contract, LORD Corporation shall conduct certification tests on IPBS components and deliver test result and component certification reports to the Government.

Before integration and production of the IPBS can occur, environmental, electrical, and other certification tests of the IPBS Controller, IPBS Controller Software, and IPBS Holder Assembly must be completed.

These component certification reports will be used in the IPBS airworthiness certification required for permanent installation on C-130 aircraft.

The completion of artifacts is required to support airworthiness certification in accordance with MIL- HDBK-516 and Operational Safety, Suitability and Effectiveness (OSS&E) for an IPBS for United States Air Force (USAF) C-130 aircraft equipped with 54H60 propellers.

The total estimated contract value is $1,500,000.00. The projected Period of Performance (PoP) is nine months; June 2016 to March 2017 (not including the government's determination of airworthiness). The program will be funded using FY16 3010 Congressional Add dollars.

The focus of the IPBS Component Certification Program is to complete certification of the LORD Corporation IPBS components identified below for C-130H T56A-15 engine with 54H60 propellers.

Therefore, under the contemplated contract, LORD Corporation will provide the following services for continued development of the C-130H IPBS:

IPBS Controller The objective is to have the IPBS Controller (P/N B-101760-1) certified, which includes completing the hardware testing and analysis and documenting the end item satisfies the performance requirements in the Performance-Based Work Statement (PWS). Final test reports with findings and a certification report are required.

IPBS Software The objective is to have the IPBS Software (P/N SW-11016-1) certified, which includes completing the software testing and analysis and documenting the software satisfies the referenced performance requirements in the PWS for functional use in the IPBS controller. Final test reports with findings and a certification report are required.

IPBS De-icing Bulkhead Holder Assembly The objective is to have the IPBS Holder Assembly (P/N 1018794-1) certified, which includes hardware testing and analysis of the Holder Assembly, and documenting the end item satisfies the referenced performance requirements in the PWS. Final test reports with findings and a certification report are required.

The Government will take the delivered test and component certifications reports and use them to determine the airworthiness of the C-130H aircraft with IPBS installed.

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 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 C-130H IPBS is a highly specialized system because it reduces propeller vibrations caused by mass and aerodynamic imbalances experienced in flight. These imbalances have been demonstrated to reduce avionics and engine reliability, thereby increasing maintenance labor and cost. Currently, only ground-balancing methods are employed, which do not adequately correct imbalances due to mass and aerodynamic loads experienced in flight. The C-130H IPBS is a permanently installed, active balance system that continuously monitors and automatically corrects for mass and aerodynamic imbalances on the ground and in flight. The USAF has a requirement to install IPBS on C-130H aircraft. The system must meet airworthiness certification criteria before installation.

Failure to certify IPBS and install it on the C-130 fleet will result in the continued detrimental effects to the propulsion system from propeller vibration, resulting in increased cost ownership and decreased aircraft availability.

The IPBS effort began in 2002 as a Commercial Operations and Support Savings Initiative (COSSI) project with a demonstration of the feasibility of in-flight propeller balancing by installing an existing commercial balancer on a single propeller for an in-flight test. This feasibility assessment cost approximately $1.5M and took two years to accomplish and its success led to Congressional funding to develop and flight test an

IPBS.

In September 2005, Air Mobility Command (AMC) approved the permanent installation of the LORD Corporation IPBS (AMC 05-042) and in September 2007, the Government awarded a sole source contract to LORD Corporation to design and manufacture the IPBS for full-scale qualification testing in preparation for permanent installation. The Government was not able to complete all of the testing required for the government to make an airworthiness certification for the IPBS controller, controller software, and holder assembly due to a delay caused by a bearing failure in the IPBS system and, ultimately, the retirement of the test aircraft.

The sole source contract associated with that previous effort is FA8504-07-C-0011. The PoP was 10 September 2007 through 20 December 2011 and cost $4.6M in testing. In total, the COSSI, sole source contract and PoP extensions, this project took 9-years to get where it is today. The OEM holds proprietary rights to the data and they stated 14 December 2015 they were "unwilling to sell the data required for the manufacture, repair, and testing of the In-Flight Balancing System at any cost." Furthermore, LORD Corporation has patented this technology and maintains manufacturing rights. Because of this, reverse engineering or having another company produce the components is not feasible. LORD Corporation is the only supplier for a permanently mounted, in-flight operational, dynamic balancing system for 54H60 propellers and holds United States Patents 8961139 and 8961140 on aircraft propeller balancing systems.

If this effort were opened to competition, a competitor would be required to design a completely new propeller balancing system. This would create significant risk and cause an unacceptable delay based on the time required to complete the development and testing of a new system. This new effort would include producing engineering requirements, complete development of a different balancing system, assembly of test articles, procurement and assembly of test fixtures, ground and flight tests, and component certification. To have another source develop a C-130H compatible, permanently mounted, active balance system would require approximately nine years for development and testing. This includes time for design engineering, laboratory testing, prototype testing, developmental and qualification testing, and operational testing. The design of the existing IPBS components is based on existing commercial items for which LORD has maintained all of the existing intellectual rights. This is based on the previous IPBS development contracts N00019-00-G-01745/XT07 and FA8504-07-C-0011.

This acquisition supports the continued development of the C-130H IPBS. The Controller, Controller Software, and De-icing Bulkhead Holder Assembly. It requires electrical, environmental, and other testing to complete the certification requirements before production units can be installed on the aircraft.

The current technology uses only ground balance methods that account for mass imbalances. This effort is not an ACAT I or II program. The C-130H IPBS is the first permanently mounted, in-flight operable, active balance system that continuously monitors and automatically corrects for mass and aerodynamic imbalances on the ground and in-flight.

The Government does not possess the production-level drawings as previous contracts were developmental contracts and the system configuration was not finalized. The Government possesses some engineering and installation drawings that were used for installation of the test configuration of IPBS and were acquired as deliverables under the previous contract; however, these drawings are not adequate to support production nor are they formatted properly to be maintained in Government databases.

LORD Corporation developed the IPBS for United States military aircraft with the T56A engine/54H60 propeller configuration. The Government does not have access to the intellectual property used to develop or manufacture the components. Testing and manufacturing requires the services of LORD Corporation.

Once these components are certified, there is no subsequent requirement for certification of these components.

There are no suitable replacements for the components manufactured by LORD Corporation that automatically balance the 54H60 propeller. Existing commercial items would be similar to the commercial balancer that LORD started with in 2002 which would require a significant amount of non-recurring engineering (NRE) to resize and configure for the 54H60 propeller. Any design other than LORD's design would be unproven and would increase both the technical and programmatic risk.

Accordingly, LORD Corporation is the only source capable of performing the effort due to their involvement in the earlier phases of IPBS development under contract FA8504-07-C-0011. LORD Corporation is the only firm 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 expected to 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.

This requirement will be synopsized on the Federal Business Opportunities (FedBizOpps) web page as required by FAR 5.201 citing conditions which preclude full and open competition. A Sources Sought Synopsis (SSS), #FA850416R0002 was posted 22 October 2015 and closed 6 November 2015. The synopsis requested the identification of potential sources that that may possess the expertise, capabilities, and experience to meet the requirements for certification of the In-Flight Propeller Balance System (IPBS) components. The Government does not own or have access to the data or components, therefore the contractor was required to furnish all material, support equipment, tools, test equipment, and services. The contractor was also responsible for providing, maintaining, and calibrating all support equipment required at their facility or a subcontractor's facility.

Two companies submitted responses; Alion Science and Technology Corporation and LORD Corporation (the OEM). Alion's response did not adequately address several areas within the SSS. Specifically, the absence of drawings, specifications, technical data, test procedures, etc., additionally, they did not fully describe their capabilities and experience in required test, evaluation, and process/procedures with regard to required items in IPBS. Finally, Alion ignored all of the subparts, stating environmental and vibration testing would be done at a “sister office” and that Alion has “several trusted vendors with proven experience” for the electromagnetic testing. Alion did not state the facilities and equipment needed to conduct the software certification.

LORD Corporation adequately addressed the RFI/Sources Sought directives. LORD Corporation did not explicitly state it, but since they are the developer and OEM for IPBS, they do not have an issue with acquiring the components and data.

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

The overall cost of this acquisition will be determined to be fair and reasonable to the Government. In accordance with FAR 15.403-4, the contractor will be required to provide certified cost or pricing data to be used supporting the Government's evaluation of the proposed cost. The contract price will be negotiated in accordance with the procedures in FAR Part 15 ensuring the ultimate cost to the Government is fair and reasonable.

The Basis of estimate and steps used to determine that the cost estimates are fair and reasonable will include technical evaluations and audits in accordance with FAR 15.4. The Government will negotiate the proposed mix of skill labor, labor hours, types and quantities of materials, other direct costs, and direct and indirect rates. The evaluations include:

a. Review of engineering scope by AFLCMC/WLNEA

b. Review of adequately developed PWS for contractor pricing by AFLCMC/WLNCC

c. Review of contractor's technical approach and reasonableness of labor and materials by AFLCMC/

WLNCC

d. The proposed skill mix of direct/indirect rates and other direct costs will be negotiated by the Government based on recommendations from the Defense Contract Audit Agency (DCAA).

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

Market research was conducted and completed on 16 December 2015, in accordance with FAR Part 10.001 and 10.002. The market research encompassed a review of potential vendors that can obtain the certification of the IPBS Controller, Software, and Holder Assembly.

A SSS was posted 22 October 2015 and closed 6 November 2015. Two companies responded with LORD Corporation being one of the respondents. The other respondent was evaluated and determined to not have the capability to fulfill the requirements. They did not possess the components or the data to manufacture the components and do not have the data or software required to complete the testing and certifications.

Other market research techniques used were a United States Census Bureau North American Industry Classification System (NAICS) (541380, Environmental Testing Laboratories or Services) search, a Small Business Administration (SBA) Dynamic Small Business Search (DSBS), contract reviews, an internet search, and telephone contact using four different key phrases: Manufacture of in-flight propeller balance system, P/N B-11026-1 balancer assembly, MIL-STD-810 testing, and RTCA Document DO-160 testing.

Results of the market research are as follows:

1. Manufacture of in-flight propeller balance system: The search results can be grouped into the following three categories: Dynamic Balancing; In Flight Propeller Balancing; and Other.

a. Dynamic Balancing is a technology similar to balancing a wheel on a car where vibration data is collected from propellers being operated on the ground, an algorithm is used to recommend a weight correction by weight and location, the propeller and engine is shut down, the correction is made, and the correction is evaluated again. Although there were 34 query returns on system described and offered by different vendors, the USAF already accomplished dynamic balancing using equipment manufactured by Honeywell so none of these query returns were relevant.

b. There were 17 query returns on In Flight Propeller Balance System from various sources. All of these results were associated with the IPBS manufactured by LORD Corporation.

c. Other: This included 40 query results from various vendors on irrelevant (or marginally relevant) topics including advertising for propellers; propeller repair, flight school, model airplane sales, and the aerodynamics associated with powered flight using propellers. None of the results were relevant.

Summary: Of the 91 query results evaluated, 34 (37%) were for dynamic balance and 40 (44%) were for miscellaneous responses. None of these 74 responses was relevant. There were 17 relevant responses, however, they were all written on different perspectives of the IPBS manufactured by LORD Corporation.

2. P/N B-11026-1 Balancer Assembly: A total of 27 query results were evaluated and none were determined to be relevant. They addressed a variety of dynamic balance issues or other topics not related to the requirement.

3. MIL-STD-810 and RTCA Document DO-160 testing: The testing part of this requirement was included in the market research to access subcontracting small business opportunities of the prime.

Our research concluded the prime contractor would have multiple small business options to accomplish the task. There were 15 different vendors that advertised their ability to accomplish the required MIL-STD-810 testing and 10 different vendors that advertised their ability to accomplish the required RTCA Document DO-160 testing.

Market research data concluded the strategy to pursue for this acquisition is sole source to LORD Corporation.

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 above.

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 is a follow-on effort to the previous developmental contract to complete the certification testing required for permanent installation on C-130H aircraft.

The Justification and Approval for the previous contract included the section “Actions currently in progress or which will be taken to remove competitive barriers on subsequent acquisitions.” It stated that the deliverables in that task included all of the drawings, specifications, and technical data required to integrate IPBS into a 54H60 propeller and C-130 aircraft. Those deliverables were received by the Government and will be used. However, at the end of the previous contract, IPBS was expected to have completed all certification testing. Due to mechanical issues and, ultimately the retirement of the aircraft, testing was cut short and IPBS was not certified. This follow-on contract will complete the testing and certification.

The deliverables from the previous contract do not contain the information required to the testing and certification. Without the required data, completion of this effort organically is not feasible. In December 2015, LORD Corporation stated they were unwilling to sell the data required data to the Government.

LORD Corporation has also patented this technology and maintains the manufacturing rights. Because of this, reverse engineering or having another company produce the components is not feasible.

The certification process is non-recurring; once the components are certified, there is no other need for additional airworthiness certifications of those components.

Upon completion of this sole source acquisition for testing and certification, the Government plans to conduct a follow-on competitive acquisition for integration and installation of the C-130H IPBS.

Procurement of a complete production-level technical data package with unlimited rights will be included in the follow-on acquisition, in addition to trial kit and verification kit.

XII. Certification by the Contracting Officer.

As evidenced by my signature, 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.