Justification and Approval_Redacted -updated.pdf

CUI

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. Agency and Contracting Activity.

This Justification and Approval (J&A) requests authority for Other Than Full and Open Competition (OTF&OC) to support requirements generated for the Air Force Sustainment Center (AFSC), 638 Supply Chain Management Group (SCMG), 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 FD2060-23-00045.

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

Due to the circumstances described herein, the activity requests authority to establish a follow-on repair contract for AN/ALR-56C Low Voltage Power Supply (LVPS) using Other Than Full and Open Competition as prescribed by FAR 6.302-1, Only One (or a limited number) Responsible Source(s) and No Other Supplies or Services Will Satisfy Agency Requirements. This action will result in the award of a new follow-on Requirements Indefinite Delivery Contract (IDC), which will include a 12-month basic and four (4) additional 12-month ordering periods (FY23-FY28).

This will be a firm fixed price (FFP) contract. Based on the projected contract award date, orders can be issued 27 Sep 2023 through 26 Sep 2028.

This requirement will be a limited competition between the following companies:

CRANE ELECTRONICS, INC.

84 Hill Ave NW Fort Walton Beach, FL 32548-3858

CAGE: 09062

Large Business

PACIFIC ELECTRONIC ENTERPRISES, INC. (PEE)

7471 Talbert Ave Huntington Beach, CA 92648-1209

CAGE: 32324

Small Business

III. Description of supplies/services required to meet agency needs (including the estimated value).

This requirement is for a performance-based, long-term repair of the LVPS, National Stock Number (NSN) 6130-01-521-2947EW, Part Number A2D0516-1. The LVPS is a component of the AN/ALR -56C Radar Warning Receiver (RWR), which provides power required by Line Replaceable Units (LRUs). The LVPS goes into the next higher assembly which is also a Power Supply. These Power Supplies provide operating power for the RWR as well as panel lighting power to other aircraft systems. The RWR provides functions of threat signal detection, identification, and direction finding. This RWR is applicable to the F-15 C/D/E aircraft. The

*Best Estimated Quantity **Teardown, Test, & Evaluation ***Not Separately Priced

Total estimated contract value is A 3% escalation factor was applied to estimated unit price for each out-year ordering period. The basis for the estimated cost was derived from the previous repair cost under the current effort, FA8522-18-D-0015.

Based on the anticipated contract award date, orders can be issued on this Requirement IDC for five years, anticipated to be 27 Sep 2023 through 26 Sep 2028. This J&A covers the ordering period of the Requirement IDC through completion of all delivery/task orders. This acquisition will be funded with Consolidated Sustainment Activity Group-Supply Division Defense Working Capital Fund 97X4930 appropriations.

This NSN has been screened and assigned Repair Method Codes (RMC) “R1” and Repair Method Suffix Codes (RMSC) code of “R.”

RMC R1 - Suitable for competitive repair for the second or subsequent time.

RMSC R - The Government does not own the data or the rights to the data needed to contract repair of this part from additional sources. It has been determined to be uneconomical to buy the data or rights to the data. It is uneconomical to reverse engineer the part. This code is used when the Government did not initially purchase the data and/or rights. If only one source has the rights or data to repair this item, RMCs 3, 4, or 5 are valid. If two or more sources have the rights or data to repair this item, RMCs 1 or 2 are valid.

IV. Statutory authority permitting other than full and open competition.

10 U.S.C. 3204 (a) (1) [formerly 10 U.S.C. 2304 (c) (1)], as implemented by FAR 6.302-1, required by FAR 6.303-2(b) (4), Only One (or a limited number) of Responsible Source(s) and No Other Supplies or Services Will Satisfy Agency Requirements.

V. Demonstration that the contractor's unique qualifications or the nature of the acquisition requires use of the authority cited above (applicability of authority).

The current contract for these services is FA8522-18-D-0015. It was a limited competition between Crane Electronics, Inc. and PEE with award made to Crane Electronics, Inc. on 27 Sep 2018. This contract expires on 26 Sep 2023.

BAE (CAGE: 81413) is the AN/ALR-56C Original Equipment Manufacturer (OEM), however has never performed any repairs of this NSN, nor taken action to become a qualified source of repair. Based on this, the Government has determined them not capable of performing this repair effort. PEE and Crane became qualified repair sources by reverse engineering the repair processes and developing repair data for the LVPS at their own expense. As a result of their reverse engineering efforts, the Government qualified them as capable LVPS repair sources.

Since both companies developed the repair processes at their own expense, they retain the rights to the technical repair data. The Government does not possess the technical repair data to pursue a full and open competition repair strategy.

The Government contacted Crane on 15 Dec 2021 inquiring on the sale of technical repair data.

On 15 Dec 2021, Crane declined to sell to the technical repair data to the Government. The Government contacted PEE on 14 April 2022 with the same inquiry. PEE responded on 14 Apr 2022 stating they declined to sell their data.

This item is highly specialized and of such complexity and criticality that first article testing measures and specialized test equipment/tooling would be required for all unproven sources.

However, the Government does not possess the technical data package (TDP) so an interested source would be required to reverse engineer the part. Qualification of a new repair source would require a new vendor to develop and provide two first articles that pass qualification testing. Qualification is estimated to take a minimum of three (3) years to complete at an estimated cost of . This estimate is based on information provided by Robins AFB Depot. A break in repair sustainment would cause unacceptable delays and would seriously impair the mission capability and/or cause serious damage or harm, as follows: Failure to repair these assets will lead to increased Mission Incapable Awaiting Parts and Surge requirements that will ground aircraft and ultimately result in mission failure or loss of life.

The AN/ALR-56C system is no longer in procurement and will not be installed on any additional platforms. The ALR-56C is only installed on F-15 C/D/E versions. The divesture date for all F- 15C/D’s is scheduled to be completed by FY 2026. The F-15E fleet is currently being modified to replace the AN/ALR-56C with a new Electronic Warfare suite, Eagle Passive Active Warning Survivability System (EPAWSS), which is scheduled for completion by 2030. Based on fielding the EPAWSS, the retirement date of the AN/ALR-56C is in 2030.

A Return on Investment (ROI) analysis for the LVPS was conducted and concluded on 10 Apr 2022. The alternatives used were Sole Source and Reverse Engineering. The following are the assumptions that were used while conducting the analysis.

• Service life of the LVPS until 2030

• Annual repair/calibrations costs were based on 2022 repair/calibration price adjusted for inflation

• Reverse engineering effort requires three (3) years in total.

• Calculations were based on a potential savings of 30% per repaired unit.

• Reverse Engineering estimate is based on a 581 SMXS analysis performed in 2018 which resulted in an estimate of (updated to for current year)

• Outcomes o Qualifying a new vendor would save the Government 30% repair cost. The Government would not see a ROI until 2035.

Considering the remaining service life of the LVPS, there will not be adequate time remaining for the Government to gain positive ROI on qualification of a new vendor.

Based on available data, engineering knowledge of the item and the aerospace industry, and acknowledgement of the constraints resulting from not having Government-ownership of required intellectual property/data, Crane and PEE are the only firms capable of providing the services described in Section III above without the United States Air Force experiencing unacceptable delays in fulfilling its requirements.

VI. Description of efforts made to ensure that offers are solicited from as many potential sources as practicable, including whether a notice was or will be publicized as required by subpart 5.2 and, if not, which exception under FAR 5.202 applies.

A Sources Sought (SS) / Request for Information (RFI) synopsis was released via the System for Award Management (SAM.gov) website on 07 Jan 2022 with a response date of 09 Feb 2022 under Notice ID FD20602300023. The SS/RFI requested responses from interested vendors that possess the expertise, capabilities, and experience to meet qualification requirements for this effort. There were no respondents.

This requirement will be synopsized on SAM.gov website as required by FAR 5.201. It is anticipated that sources having an interest in subcontracting may be identified through this synopsis. Any source who responds to the Government as a result of the synopsis will be identified to the prime contractor as a potential 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. The Government anticipates fair and reasonable prices will be determined based on adequate competition in accordance with FAR 15.403-3(b). In the event competition is not achieved, he contractor will be required to provide certified cost or pricing data to be used in supporting the Government’s evaluation of the proposed cost in accordance with FAR 15.403-4. 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 Management Agency 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 was conducted 10 Sep 2021 through 25 Apr 2022 as outlined by FAR 10.001 and 10.002. The Market Research Report was completed on 27 Apr 2022. The following market research techniques were used: SS/RFI; reviewing industry reports, trends and product developments; discussions with industry representatives; internet searches; and industry knowledge possessed by the AN/ALR-56C Engineering staff.

A SS/RFI was released on SAM.gov on 07 Jan 2022 under Notice ID FD20602300023. No interested sources responded to the SS/RFI.

Engineering reviewed industry reports, trends and product developments, and talked with field personnel, and maintaining an active dialog with the AN/ALR-56C system designer/manufacturer (BAE) and the qualified repair sources PEE and Crane. The team conducted several industry-wide searches on the internet, using the following search engines.

The key terms used in the searches were “ALR-56C Power Supply.” The internet sites used are as follows:

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

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

• http://www.eem.com/,

• Review of Govt-proprietary component product database (Haystack).

Crane Electronics, Inc. and PEE were examined for their service capabilities and for services they are currently providing or have provided in the past. Internet searches and vendor surveys did not result in the discovery of any new sources that possess the detailed knowledge required for the repair of these assets.

Market research revealed that there is no commercial application that can fulfill the AN/ALR- 56C LVPS requirement. The uses of the AN/ALR-56C LVPS is limited to military aviation.

These components were specifically designed for the AN/ALR-56C RWR for electronic warfare applications.

Thus, market research concluded PEE and Crane are the only qualified sources with the data, skills, and equipment necessary to support this effort within the allotted time and to meet this requirement.

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

None

X. List of any sources that expressed, in writing, an 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 prior J&A did not include a plan to break barriers to competition due to the end of the life cycle for the LVPS.

It would not be economical or cost beneficial for the Government to pursue qualification of a new repair source due to the planned phase out of AN/ALR-56C. Therefore, the AN/ALR-56C team will not take any additional actions to remove or overcome any barriers to competition at this time.

XII. Certification by the Contracting Officer.

As evidenced by my signature on the Coordination and Approval Document (CAD), 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) on the CAD, I (we) certify that any supporting data contained herein, which is my (our) responsibility, is both accurate and complete.