14-00896_J_and_A_for_FBO.pdf

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITY

This Justification and Approval to request authority for Other Than Full and Open Competition supports requirements generated for the Air Force Sustainment Center (AFSC), 638 Supply Chain Management Group (SCMG), and the 408 Supply Chain Management Squadron (SCMS) / (GULB). The contracting office for this requirement is AFSC/PZABB. The purchase request number supporting this contracting action is

FD2060-14-00896.

II. NATURE AND/OR DESCRIPTION OF THE ACTION BEING PROCESSED

Due to the circumstances described herein, the activity requests authority to acquire the Engineering Services listed in this document using Other Than Full and Open Competition as prescribed by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. This action will result in the award of an engineering services contract for the form, fit, function, and interface redesign for the ALQ-172 LRU-8, National Stock Number (NSN) 5985-01-290-2072EW.

This action will result in a new predominantly Cost Plus Fixed Fee (CPFF) C- type engineering services contract, the first of its kind for this item. A Cost Plus Fixed Fee (CPFF) contract type was determined for this development effort due to circumstances and uncertainties which do not allow the requirement to be defined sufficiently for a fixed price type contract. The period of performance will be 36-month basic with no options or ordering periods (FY15-FY17). The sole source requirement will be obtained from the following source:

Exelis Inc.

77 River Road Clifton, NJ 07014

CAGE: 28527

Large Business

III. DESCRIPTION OF THE SUPPLIES/SERVICES REQUIRED TO MEET THE AGENCY’S

NEEDS

Under the contemplated engineering services contract, Exelis will provide the following services to the United States Air Force (USAF) which are required to support the ALQ-172 Weapon System that is installed on the B-52H aircraft.

USAF REQUIREMENTS:

CLIN Pricing Type

Units Estimated Unit Price

FY15 Estimated Cost

0001 CPFF Engineering Services 1 LOT 0002 CPFF Prototypes 12EA

0003 CPFF Data 1 LOT 0004 CRNF Travel/Per Diem 1 LOT

Total Estimated Contract Value $ 42,175,000.00

TOTAL ESTIMATED CONTRACT VALUE $42,175,000.00

Prices for the engineering services, prototype development, and fabrication were based on comparison to previous engineering projects for LRU redesigns.

Requirements for development and redesign, particularly those unique to the Government, usually result in a greater risk assumption by the Government. This is true for developmental type contracts when performance uncertainties or the likelihood of changes makes it difficult to estimate performance costs in advance and with sufficient accuracy for use of any firm pricing arrangement. After prototypes have been produced and as production begins from redesign of the item, the cost risk should shift to the contractor and a Firm Fixed Price (FFP) pricing arrangement should be considered.

The anticipated type of appropriation that will be used to fund this effort is the Consolidated Sustainment Activity Group-Engineering (CSAG-EN). FY15 funds will be used for this requirement.

This contract will require engineering services for the form, fit, function, and interface redesign of the ALQ- 172 LRU-8, delivery of prototypes, and successful testing at the system and aircraft level based upon contract performance parameters in Section 2.0 of the Performance Based Work Statement. These prototypes will qualify a form, fit, function, and interface redesign that will replace the current legacy ALQ-172 LRU-8.

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)

Research has identified Exelis, Inc. (CAGE 28527) as the currently qualified source with the unique technical expertise, experience and business relationships to satisfy the Government’s requirements for these highly specialized engineering services redesign requirements.

Exelis is currently the only contractor with the system knowledge and personnel required to support and develop the form, fit, function, and interface redesign. The Government does not have enough technical data to give to an additional source to support the effort. This effort requires the PIFS and the interface data for the LRU-8 to the other ALQ-172 LRUs. The Government does not own the data for the interfaces, which includes the information for RF, digital and analog timing between LRU-7 and LRU-9. LRU-7 provides electronic signals to control LRU-8, and the LRU-7 circuit card assemblies (CCAs) were designed by Exelis. The Air

Force has continuous requirements with Exelis, not only for repair support, but for support of all types.

Specifically, hardware modification, R&M projects, and both hardware and software engineering support.

Another contractor must fabricate an EMTS/Hot Mockup, all ALQ-172(V)-2 LRUs, and LRU-21 Test Set.

This effort requires an update to the EMTS, which is the depot level tester used for repair. Exelis is the OEM for the EMTS. This workload will remain organic based on the core decision in SORA 09-154. Another source cannot acquire an EMTS due to obsolescence and the amount of GFE required to support the setup for the EMTS. The cost and time involved in having another source acquire the equipment and expertise would not be cost effective and feasible. The Government doesn’t have additional equipment to furnish a new source. The estimated time for another vendor to become familiar with the ALQ-172 PAAM and system would take three to five years and cost to reverse engineer and redesign the LRU-8.

These estimates are based on prior ALQ-172 projects where a vendor not familiar with the ALQ-172 attempted redesign efforts. To support the effort, another vendor would need access to the ALQ-172 system and interface data for the phased array antenna system, which includes the ALQ-172 LRU-9 and LRU-7. The Government does not own the interface data, which is proprietary to Exelis, Inc. The Government did request on 2-Apr-14 a Rough Order of Magnitude for the data and Exelis quoted for the entire ALQ-172 system. The government would incur a substantial duplication of costs. It would be uneconomical to buy the current data because the redesign includes the requirement for a full technical data package, which will include everything the Government is lacking currently to support LRU-8. The technical data package for the redesign was quoted . The cost difference is significant because it is less costly to create a new data package versus overhauling a legacy package. It would take another vendor three years to become familiar with the ALQ-172 system due to its complexity. This estimate is based on prior contracting efforts with vendors, including prior OEMs, for ALQ-172 items, that have been asked to assist on other projects, but have not supported the ALQ-172 for a significant period of time. A three year delay is unacceptable to the USAF because this delay would put the Government past the need date for a redesigned LRU-8.

Based upon the information above, the government would incur a substantial duplication of cost and an unacceptable delay. As such, the OEM has the unique technical expertise, experience, specialized test equipment and knowledge to support the form, fit, and function redesign at their facility.

VI. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE SOLICITED FROM

AS MANY POTENTIAL SOURCES AS DEEMED PRACTICABLE

This requirement will be synopsized on the Federal Business Opportunities (FedBizOpps) web page citing conditions which preclude Full & Open Competition. Sources expressing an interest as a result of the synopsis will be investigated for their capabilities to perform on this and/or future requirements. This is a pre-award synopsis of proposed contract actions, as required by FAR 5.201(b) in advance of issuance of the solicitation.

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 fair and reasonable to the Government. In accordance with FAR 15.403-4, the contractor will be required to provide certified cost and pricing data to be used in supporting the

Government’s evaluation of the proposed cost. The proposed skill mix of labor, labor hours, types and quantities of material, other direct costs, and direct and indirect rates will be negotiated by the Government based on recommendations from the Defense Contract Audit Agency (DCAA), Defense Contract Management Agency (DCMA), and expert technical personnel supporting the program. 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.

VIII. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE RESULTS, OR A

STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT CONDUCTED

Market research, in accordance with FAR Part 10, was conducted in March 2014 by queries of the proposed acquisition, advising industry of the pending acquisition and soliciting inquiries from interested parties.

Internal knowledge possessed by the AN/ALQ-172 engineering staff was queried. Engineering is actively engaged in component product sustainment, staying current with industry developments by reviewing industry reports, trends and product developments, talking with field personnel, reviewing applicable company portfolios on a regular basis, and maintaining an active dialog with the sustainment parts suppliers. The team conducted a review of several industry-wide searches on the Internet, using the following AE-recommended component search engines. The key terms used in the search were: Phased-Array Antenna:

http://www.aerospace-technology.com/contractors/index.html, http://www.globalspec.com/ProductFinder, http://www.eem.com/, http://dsbs.sba.gov/dsbs/search/dsp_dsbs.cfm http://www.iso-parts.com/Default.aspx www.bpn.gov/ccrsearch/ www.google.com

The Government found several companies that have the capability to make antennas; however, the Government does not possess the data or equipment to provide another vendor for this effort. Exelis produced the Prime Item Functional Specification (PIFS) for the LRU-8 and the other LRUs directly related to the PAAM. Development of the new PAAM will require extensive system integration testing to ensure integrity of the engineering design and limit developmental risk. System integration testing includes sell off at the contractor’s facility on the Enhanced Maintenance Test Set (EMTS) and at the depot on their EMTS. The EMTS tester includes a test rack and a full system mock-up of all the LRUs for the ALQ-172, as well as, an ALQ-155 test interface. There are only two AN/ALQ-172 (V) 2 EMTS benches in existence. One bench is at Exelis to support repairs and engineering services requirements, and the other bench is at the depot. The software for the EMTS is proprietary to Exelis. Exelis is the only source with this equipment and it is needed to support the engineering redesign. The EMTS cannot be furnished to another vendor because it would create a work stoppage for over 20 NSNs for the items repaired by Exelis.

Therefore, market research reveals that there is only one qualified source, Exelis that can meet the Government’s schedule for this urgent requirement.

IX. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN

COMPETITION

See Section VI above.

X. LIST OF SOURCES, IF ANY, THAT EXPRESSED INTEREST IN THE ACQUISITION

No other source(s) other than Exelis, Inc. has expressed interest at this time.

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

Currently, the Government does not have a technical data package to provide to other vendors. This effort requires the timing specification between other LRUs and that is proprietary to Exelis. The Government requested a ROM in Sept 2013 and Exelis provided a rough order of magnitude . A full technical data package is required as a deliverable for this effort. The technical data package that will be procured under this effort will be able to support competition for future acquisitions. Therefore, future acquisitions for the LRU-8 will be competed. The B-52H is scheduled to fly until 2048.

XII. CONTRACTING OFFICER’S CERTIFICATION

The contracting officer’s signature on the Coordination and Approval Document evidences that the contracting officer has determined this document to be both accurate and complete to the best of the contracting officer’s knowledge and belief (FAR 6.303-2(b)(12)).

XIII. TECHNICAL/REQUIREMENTS PERSONNEL’S CERTIFICATION

As evidenced by their signatures on the Coordination and Approval Document, the technical and/or requirements personnel have certified that any supporting data contained herein, which is their responsibility, is both accurate and complete (FAR 6.303-2(c)).