JA_Signed_Redacted.pdf

COORDINATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

ACQUISITION GREATER $150K, BUT NOT EXCEEDING $700K

PR Number: FD2060-16-00039

Estimated Value: $

Category: Other Contracting

Authority: 10 U.S.C. 2304(c)(1)

Based on the justification provided herein, acquisition of the supplies/services is recommended using Other than Full and Open Competition (OTF&OC) using the authority cited above.

COORDINATION AND APPROVAL

Technical/Requirements ____________ ______________________________ Symbol Date Phone

Legal _ _ _________________________________ Symbol Date Phone

(Required at $650K and above)

APPROVED:

Contracting Officer ______________________________ Symbol Date Phone

408 SCMS 11/2/15 472-4571

78 ABW/JAQ 19 Nov 2015 472-0569

07408

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITY

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

FD2060-16-00039.

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

Due to the circumstances described herein, the activity requests authority to acquire the repair services listed in this document using Other Than Full and Open Competition as prescribed by Federal Acquisition Regulation (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 a new Firm Fixed Price contract, which will be Requirements Type contract with a basic and four, one-year ordering periods in which additional quantities may be ordered. This sole source requirement will be repaired at the following company:

Keysight Technologies, Inc.

9780 S. Meridian Blvd.

Englewood, CO 80112.

CAGE: 1LQK8

Large Business

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

NEEDS

Under the proposed contract, Keysight will repair the AN/ALM-233 and AN/ALM-256 Support Equipment Service Life Extension Program (SESLEP) test equipment items which support the AN/ALQ- 184 and AN/ALQ-131 Electronic Countermeasure Pods. Consolidated Sustainment Activity Group (CSAG) funding will be utilized.

The total estimated cost for this acquisition can be found above. This estimate was developed using information from Keysight’s warranty repair. Out-year Estimated Unit Repair Prices were developed using a 3% escalation factor. The quantities are based on actual demand as well projections computed by the March 2015 D200A computation cycle.

These items currently have 3 ea. backorders. Repair shall be accomplished within 90 days.

According to the RMC/RMSC Contract Repair Screening Analysis Worksheet, the RMC/RMSC for these items is R3/B – Repair, for the second or subsequent time, directly from the actual manufacturer. This part must be repaired from a manufacturing source(s) specified on a source control or selected item drawing as defined by the current version of DoD-STD-100. Suitable technical data, Government data rights, or manufacturing knowledge are not available to permit repair from other sources, nor qualification testing of another part, nor use of a second source part in the intended application. Although, by DoD- STD-100 definition, altered and selected items shall have an adequate technical data package, data review discloses that required data or data rights are not in Government possession and cannot be economically obtained.

IV. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION

10 USC 2304(c), 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 AN/ALQ-184 and AN/ALQ-131 are self-protect Electronic Counter Measures (ECM) Electronic Warfare (EW) pods with widespread use in USAF combat aircraft. They provide electronic countermeasures against Surface to Air Missiles, radar-directed Anti-Aircraft Artillery, and Airborne Interceptors for the A-10 and F-16 aircraft. The AN/ALM-233 and AN/ALM-256 provide EW maintenance shops the ability to perform intermediate level maintenance on the AN/ALQ-184 and AN/ALQ-131. These SESLEP items are critical to the AN/ALM-233 and AN/ALM-256, and without them, the AN/ALQ-184 and AN/ALQ-131 could not perform their respective missions.

SESLEP was fielded in 2010 by AFLCMC/WNYCD to replace aging and obsolete items within the AN/ALM-233 and AN/ALQ-256. The OEM, Agilent (now Keysight Technologies, Inc.), provided the hardware, kitting, fielding, and warranty repair on GSA contract number 4QBR57103016.

The SESLEP items were based on Commercial Off the Shelf (COTS) items with uniquely configured hardware and firmware to meet the specific requirements of the AN/ALM-233 and AN/ALM-256, which are the only users of these items.

Hardware configuration drawings were included with the procurement. These Government-owned drawings contain specification and configuration information only. Included are assembly/disassembly procedures, identification of the hardware required for assembly, complete parts lists for the kits, and firmware information. Internal technical drawings was not included.

Keysight became the sole qualified repair source through the warranty repair process. The five-year warranty repair began expiring April 2015 and will completely expire December 2015. Therefore, this acquisition is for continued performance of a highly specialized service.

These items to be repaired under this proposed contract are highly specialized in nature. As previously stated, the SESLEP items are uniquely configured (hardware and firmware) for the AN/ALM-233 and AN/ALM-256. The items must be compatible with the latest AN/ALM-233 and AN/ALM-256 software as well as the latest firmware. According to the AFMC Form 762, Contract Repair Screening Analysis Worksheet, special tools/test equipment and special facilities are required, all of which Keysight currently possesses.

The internal technical drawings required to repair these items, to include the manufacture of internal piece parts, are owned by Keysight and considered proprietary. In an email dated 25 Aug 15, Keysight stated that they are not interested in providing or selling the proprietary internal technical drawings required to repair these items.

Keysight has indicated that, due to obsolescence, repair capability/support will only be guaranteed through 2020. The Government will begin researching future replacements for these items. Due to a fleet-wide uniformity requirement, every AN/ALM-233 and AN/ALM-256 requires modification/upgrade simultaneously. Replacement via attrition is not an option. A complete replacement is expected to cost no less than which is based off the cost that it took to field the current configuration.

The AN/ALQ-184 Program Office believes that award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and unacceptable delays in fulfilling the Air Force’s requirements. Because Keysight is unwilling to sell the propriety internal technical drawings required to repair the SESLEP items, award to any other source would require a reverse engineering effort to develop internal technical drawings to duplicate the existing propriety internal technical drawings owned by Keysight. Assuming that a reverse engineering project is even technically possible, a new vendor would be required to purchase the internal components from Keysight. Replacing the internal components with like-items from other vendors could not be accomplished through attrition due to the aforementioned fleet uniformity requirement. The only option other than sole-source repair is a complete redesign which would cost no less than $30M based on the cost to field the current configuration. The cost of such an effort obviously exceeds the estimated cost of this proposed contract. Coupled with relatively low quantities, the costs for such an effort could not be recouped within the next five years when the components become unrepairable due to obsolescence.

Based on the Air Force engineering staff’s experience with similar projects, a reverse engineering effort would expose the Air Force to unnecessary cost risk and technical risks with no guarantee of success.

Upon final warranty expiration in December 2015, these items will be unsupportable. It would take approximately two to three years for another vendor to obtain the necessary tools/equipment and facilities, complete the reverse engineering effort, deliver qualification reports, provide First Article assets for Government testing, deliver a technical data package, and begin deliveries. The delays associated with award to another vendor are unacceptable as the backorders and possibly MICAPs will accrue during the new contractor’s reverse engineering effort, build, test, qualification, manufacturing start-up, and delivery phases. The overall mission capable rate of the AN/ALQ-184 and AN/ALQ-131 fleets would be detrimentally impacted, as would the aircraft they support. Accordingly, Keysight 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 as well as unacceptable delays in fulfilling the Air Force’s requirements.

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

FROM AS MANY POTENTIAL SOURCES AS DEEMED PRACTICABLE

A Request for Information was posted on Federal Business Opportunities (Fed Biz Ops) web page for fifteen days. Results are discussed below. This requirement will be synopsized on Federal Business Opportunities (Fed Biz Ops) web page as required by FAR 5.201, citing conditions which preclude full and open competition. Any source that responds to the Government as a result of this synopsis will be identified to the prime contractor as a potential source for subcontracting possibilities.

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 15.403-3, the contractor will be required to provide other than certified cost or pricing data to be used in supporting the Government’s evaluation of the proposed cost. This data will include, at a minimum, appropriate data on the prices at which the same item or similar items have previously been sold, adequate for determining the reasonableness of price. 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 NOTCONDUCTED

Market Research was conducted September 2015 pursuant to FAR Part 10. Thorough documentation searches were conducted within Government data bases, combined with various internet searches (Thomas Registry, IHS Haystack, Google, etc.) for part/national stock numbers and manufacturers.

Correspondence with the OEM is on file to document the present status of the item. Qualified individuals, within the appropriate Government organizations, were contacted and assisted with the gathering of product background information.

A search for HUB zone and service disabled veteran owned businesses was conducted using the Dynamic Small Business Search Engine (http://dsbs.sba.gov/dsbs/search/dsp_dsbs.cfm), using criteria consisting of keywords pertaining to the item description. A number of vendors were identified; initial analysis determined that most are not relevant as calibration services were offered but not repair services. Further research was conducted through a vendor survey to identify which vendors possess the capabilities necessary to meet the Government’s requirements. Three companies were researched and it was determined that Keysight is the only company in possession of the proprietary internal technical drawings required to repair the SESLEP items.

A Request for Information was posted on Federal Business Opportunities (Fed Biz Ops) web page for fifteen days. The only respondent was Test Equipment. Theiy believe they have the capability to repair these components based on 24 years of experience calibrating and repairing similar components as well as having access to the necessary test equipment. Despite their credentials, Test Equipment is not a qualified source and award to them would require a reverse engineering effort, which as described above, is not in the best interest of the Government.

Market research identified Keysight as the only qualified source to repair these items. They are the only company who has repaired these items. Keysight currently possesses the proprietary internal technical drawings required to repair these items and has stated that they will not provide or sell the drawings. A redesign and/or reverse engineering project for this item is not feasible due to cost, schedule, and technical risk.

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

Keysight is unwilling to provide or sell the proprietary internal drawings required to repair these items. A redesign and/or reverse engineering project is not only uneconomical to pursue but would also result in unacceptable delays. Again, such an effort would be considered high risk from a technical standpoint with no guarantee of success.

Follow-on requirements are not expected as Keysight has stated that the items have a limited repair life of five years. As previously stated, the Government will begin researching a complete replacement for these SESLEP items.

XII. CONTRACTING OFFICER’S CERTIFICATION

The contracting officer’s signature on the Coordination and Approval Document evidences that she has determined this document to be both accurate and complete to the best of her 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)).