J_and_A_redacted.pdf

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

I. Contracting Activity.

This Justification and Approval (J&A) requests authority for Other Than Full and Open Competition to support 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 FD2060-17-00043.

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

Due to the circumstances described herein, the activity requests authority to acquire the spares 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 a new Firm Fixed Price (FFP) 5-year Delivery Protection Program (DPP) Indefinite Quantity (ID/IQ) contract for production of the ALR-69 Power Supply National Stock Number (NSN) 6130-01-576-8907. The contract will consist of a two year basic for the MEQ, first article, production option, and two out-year options.

A. Special Features: DPP procedures will be utilized for this acquisition. This requirement will be a competitive effort with DPP terms. If the proven source is the successful overall best offeror, the Government will award one ID/IQ type contract with the Mission Essential Quantity (MEQ) and Out-year option(s) to the proven source. If an unproven source is the best offeror, the Government will award one (ID/IQ) type contract with the MEQ and Out-year option(s) to the proven source and one ID/IQ type contract with the first article requirements and Out-year options(s) to the unproven source.

B. Definitions:

1. DPP is a contractual vehicle which provides the Contracting Officer (CO) a means of competing the maximum practical quantity of a requirement while mitigating risk through acquiring the MEQ from a proven source to ensure continued mission support during production capability and validation from an unproven source. These items have been determined of such complexity and/or so critical that first article/preproduction testing measures are required for all unproven sources.

Also, the Government has determined that a break in coverage would jeopardize support to the mission capability of operational units. In addition, the item has an Acquisition Method Code (AMC) of 1 assigned. An AMC of “1” means suitable for competitive acquisition for second or subsequent time.

2. A proven source is an offeror who has previously satisfactorily provided the identical item to the

Government or who proposes to provide an item manufactured by the prime manufacturer or the prime manufacturer's vendor (when there is no value added by the prime manufacturer).

3. An unproven source is an offeror who has not previously satisfactorily provided the identical item to the Government and who proposes to provide an item manufactured by other than the prime manufacturer or the prime manufacturer's vendor (when there is no value added by the prime manufacturer).

4. MEQ is the quantity of an item needed during the time it takes to produce, test, and approve the first article. The MEQ provides a buffer to span the time while the first article is produced, tested and approved/disapproved.

5. Production option is the quantity that will be supplied by the proven source or the unproven source, depending on whether or not a conforming first article was submitted on schedule.

6. MEQ options are utilized as a contingency plan for handling requirements that are not known at the time. This option is to be utilized to protect against supply shortages until a new source becomes proven.

7. Out-year options are used for future requirements needed after the MEQ and Production option quantities are received. Exercise of Out-year options require re-approval by the local Competition Advocate.

The proven source for this requirement:

Strike Technology, Inc.

DBA: Wilorco 24311 S Wilmington Ave Carson, CA, 90745-6139

CAGE: 22100

Small Business

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

This requirement is for the spares purchase of the ALR-69 Power Supply NSN 6130-01-576-8907. The ALR-69 system is the primary Radar Warning receiver (RWR) for the Air Force and must remain viable on all of its combat coded aircraft. This system plays a critical role in the self-protection of Aircrews and Aircraft operating within a highly volatile threat environment. The system will remain in the active inventory for the next 24 years.

Under the proposed contract, Strike Technology, Inc. will provide the MEQ to ensure continued mission support during the time allowed an unproven vendor to successfully complete the qualification of first articles. Consolidated Sustainment Activity Group (CSAG) Defense Working Capital Funds (DWCFs) 97X4930 will be utilized. The contract is projected to award January 2018. Based on this the period of performance is projected to be January 2018-January 2023. The total estimated cost of this acquisition can be found in the table below:

Aircrews and Aircraft operating within a highly volatile threat environment. The Government currently has enough assets in inventory to cover approximately 8 months' of demand. Without the procurement of the power supply from the approved source (while unproven sources are awaiting first article testing and approval), our supply will be depleted before a new source can be qualified, resulting in backorders and Mission Incapable Awaiting Parts (MICAP) status. The MICAPs and backorders would most likely continue to accrue until a new contractor's first article testing and qualification is approved and production begins.

The Government has determined that requirement satisfies the following DPP Criteria:

1. A break in supply would jeopardize support to operational units' mission capability.

2. The item has an Acquisition Method Code (AMC) of 1 or 2 assigned, regardless of the suffix code. The AMC assigned to this NSN is “1” meaning suitable for competitive acquisition for the second or subsequent time.

3. First article testing measures are required to ensure that the new source is capable of producing a conforming part.

The Government owns Source Control Drawings (SCDs) that establish the performance, design, test, manufacture, and acceptance requirements for the C-10373 Power Supply of the AN/ALR-69 Radar Warning Receiver and owns a production level data package to facilitate competition.

Currently, Strike Technologies is the only source qualified to produce these assets. The previous requirement was solicited using competitive Insurance Policy procedures (currently known as DPP). The two qualified sources that were supported by the J&A were Strike Technologies and Martek. Martek later disclosed they no longer do business with the Government. The contract was awarded to Strike Technologies on 25 Jan 2013. The contract included a basic and three 1-year options. The final option III was exercised on 20 Jan 2017 and a delivery order for a quantity of 33 ea. was placed against this option.

The maximum quantity allowed is 100 ea. Option III is valid through 24 Jan 2018.

To mitigate the risk of increased backorders, MICAPs, and mission degradation to the ALR-69 system to which they are applicable, this procurement will utilize DPP procedures. This J&A document provides the authority to acquire the ALR-69 Power Supply under the following circumstances:

A. If the successful best value offeror is an unproven source, award will be made to the unproven offeror to qualify a first article. The MEQ will be awarded to the proven source and the DPP is activated.

B. If the unproven source is the successful best value offeror and an unexpected buy generates during the time the unproven source is qualifying the first article, MEQ Option(s) may be exercised to the proven source.

C. If the unproven source is the successful best value offeror and they qualify an acceptable first article within the time specified in the contract, the Production Option(s) will be exercised to the unproven source.

D. If the proven source is the successful best value offeror, all the Government's requirements will be awarded but exercise of Out-year option(s) require reapproval by the local Competition Advocate.

E. Production Options: If the unproven source fails to provide an acceptable first article within the time specified in the contract, the unproven source's contract may be terminated for default, then Out-year option(s) may be exercised with the proven source if they were the next lowest offeror. Until the contract is terminated for default, Out-year options can only be exercised with the proven source after re-approval by the local Competition Advocate.

F. If the unproven source is the low offeror, the proven source is NOT the next lowest offeror, and the unproven sources does not qualify a first article, then Out-year options may be exercised with the proven source only after re-approval by the local Competition Advocate.

Consideration will be given to initiation of a new competitive buy for Out-year options should the unproven source fail to deliver the conforming first article on schedule, and the proven source is not the next low offeror.

The basis for this J&A and the DPP policy concept is that full and open competition will be achieved and an award will be made to the successful best value offeror, whether proven or unproven source.

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

A Request for Information (RFI), solicitation number 17 3, was posted to Federal Business Opportunities (FedBizOpps) on September 21, 2016 with a response date of October 21, 2016. The RFI requested responses from interested sources with the capabilities to manufacture and/or knowledge of power supplies, general EW principles, electronic countermeasures, generation and storage of classified assets and/or documentation, and potential warranty services. Responses were received from two potential sources, Espey Mfg. & Electronics Corp. and Prime Power Inc. Both sources were deemed capable of qualifying through use of the Government owned drawings to produce first article test assets. These potential sources will be notified when the solicitation is posted to FedBizOpps.

This requirement will be synopsized on FedBizOpps web page as required by FAR 5.201 and citing the DPP acquisition approach. The synopsis will include conditions which preclude full and open competition to acquire the MEQ and potentially the production quantity as discussed in Section V.

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

The Contracting Officer (CO) will ensure that the supplies are acquired at a fair and reasonable cost to the Government. The CO anticipates cost will be considered fair and reasonable based on adequate competition under the DPP approach. For Alternative 1 (Complete Award), the unproven source(s) will submit proposals under Proposal Schedule A and the proven source will submit under Proposal Schedule B.

Proposal schedules A and B contain quantities for the entire contract period and will allow price comparisons between proven and unproven sources for evaluation purposes. Transition to Alternative II will only occur if a proposal under Alternative I, Proposal Schedule A is considered to be the best overall value. Prices submitted under Alternative I and II will be evaluated for reasonableness, balance and total evaluated price. In the event that competition is not realized, meaning only one proposal is received under either Proposal Schedule A or B and not both, the contractor will be required to provide certified cost or pricing data in accordance with FAR 15.403-4. Cost and price analysis will be conducted and audits will be performed by Defense Contract Management Agency (DCMA) and Defense Contract Audit Agency (DCAA), as required. The contract price(s) will be negotiated in accordance with the procedures of FAR 15, ensuring the ultimate price(s) 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 was conducted in July 2016 and finalized on 1 February 2017 in accordance with FAR Part 10. The Government performed several queries in the marketplace, as well as in databases listed on the approved Acquisition Center of Excellence (ACE) website. The ALR-69 Systems Engineering team searched the database and websites by NSN, part number, and/or item description.

The team conducted a review of several industry-wide searches on the Internet, using the following ACE-recommended component search engines. The key term used was: ALR-69.

• http://www.aerospace-technology.com/contractors/index.html

• http://www.globalspec.com/ProductFinder

• http://www.eem.com/

• https://cage.dla.mil/Search/Results?q=22100&page=1

• http://www.electronics-oems.com/

A number of vendors were identified. Further research was conducted through a vendor survey to determine which vendors possess the capabilities necessary to meet the Government's requirements. Four potential sources were discovered through market research. Of the four sources, three have been replaced, discontinued, or are no longer in business. Two of the four sources, Strike Technology, Inc. and Martek Power were previously determined to be qualified vendors. Strike Technology is a qualified vendor, however Martek Power is no longer a qualified vendor because they no longer bid for Government contracts, and their version of the power supply has been discontinued and replaced by a newer version. An RFI was posted to FedBizOpps on 21 September 2016. Two responses were received. The sources that responded are unproven, but have the potential to qualify.

The results of the market research concluded that there is market interest and there are potential sources interested in production of the ALR-69 Power Supply to support a full and open competition effort. Based on market research, the program is pursuing full and open competition; however; of the companies researched, it was determined that Strike Technology Inc. is the only proven source. No other sources can provide the immediate and ongoing coverage needed during the basic period of performance of 24 months as covered under this J&A.

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.

The proposed competitive acquisition strategy will utilized DPP procedures to ensure the continuation of mission support while a new source qualifies. It will allow for simultaneous award of ID/IQ contracts to the proven source, Strike Technology Inc., to satisfy immediate requirements and to an unproven source for first article and optional production requirements in the event an unproven source is the low offeror. If Strike Technology, Inc. is the best value, only a single production contract will be awarded. If the best value offeror is an unproven source and they cannot deliver in a timely manner, experience conformance issues, or fails first article testing, the Government has the ability to exercise option(s) to continue sustainment of the program with the proven source. Unless the unproven source's contract is terminated for default, exercise of Out-year options to the unproven source requires re-approval by the local Competition Advocate.

There are no current barriers to competition. The Government owns the data required to manufacture this item. All future requirements will be competed using full and open competition procedures or the DPP procedures, as appropriate. The ALR-69 is expected to be in use through 2041.

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.