redacted_JA_for_FA8524-15-D-0007.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), 638th Supply Chain Management Group (SCMG), 411th Supply Chain Management Squadron (SCMS)/GULD. The contracting agency for this requirement is AFSC/PZAAA at Warner Robins, GA.The purchase request number supporting this contracting action is FD2060-13-01783.

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

The purpose of this Purchase Request is to initiate the acquisition of repair capability for the NSNs listed below, which will support the sustainment of the Fuel Quantity Indicator (FQI) for the HH-60 Pavehawk helicopter. This contract action will be Firm Fixed Price Requirements Type contract with a Basic year and four 1-year Options for the specific quantities listed. This sole source requirement will be purchased from the following company:

Ontic Engineering and Manufacturing 20400 Plummer Street Chatsworth, CA 91311 Marlene Walsh Ph: 818-725-2369 (Direct) Fax: 818-725-2535 Email:

CAGE 45934

Large Business

III. DESCRIPTION OF SERVICES REQUIRED TO MEET AGENCY’S NEEDS

Under the contemplated contract, Ontic Engineering and Manufacturing will provide the following repairs, which are required to support the HH-60G Pave Hawk Helicopter in sustainment of the USAF Special Operation Forces (SOF) program:

Basic Year

NSN NOUN QTY UNIT PRICE TOTAL PRICE

6680-01-442-3181 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

6680-01-442-1888 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

Basic Year Total Option Year 1 6680-01-442-3181 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

6680-01-442-1888 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3 $790.00

Option Year 1 Total Option Year 2 6680-01-442-3181 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

6680-01-442-1888 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

Option Year 2 Total Option Year 3 6680-01-442-3181 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

6680-01-442-1888 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

Option Year 3 Total

Option Year 4 6680-01-442-3181 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

6680-01-442-1888 Fuel Qty 15 Indicator No Fault Found 3 Beyond Economical Repair 3

Option Year 4 Total

TOTAL POTENTIAL CONTRACT VALUE =

Basis for the estimated cost for this repair was derived from the average repair costs of assets repaired against Repair Contracts FA8524-12-M-0014 and FA8524-12-M-0005, with an inflation factor added to each Option Year.

IV. STATUTORY AUTHORITY

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 AUTHORITY IS APPROPRIATE

Due to the circumstances described herein, the activity requests authority to acquire this repair capability 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. The agency's minimum needs can only be satisfied by the unique supplies or services available from the cited source that possesses unique capabilities demonstrated as follows:

The Fuel Quantity Indicator (FQI) visually indicates the total amount of fuel in all fuel tanks as well as indicating individually the quantities of the left and right external auxiliary and the left and right internal auxiliary fuel tanks. The FQI is mounted on the instrument panel directly below the main fuel quantity display. Its Display Selector Switch Panel (DSSP) is mounted directly below the FQI and above the stabilizer position indicator. The FQI has bar graphs which are used exclusively to display internal auxiliary tanks' fuel quantities. When 185 gallon internal auxiliary fuel tanks are installed, the left bar graph indicates quantity of fuel in the left internal auxiliary tank and the right bar graph indicates quantity in the right internal auxiliary tank. No commercial aircraft item fits the criteria. The only qualified manufacturer of this equipment is Ontic Engineering and Manufacturing. Ontic Engineering and Manufacturing purchased the data rights from General Electric (GE) Aviation Systems LLC in May 2011, who had acquired the Original Equipment Manufacturer (OEM) of the FQI, Smith Industries, in January 2007. No other company has ever supplied the FQI assembly. Ontic Engineering and Manufacturing is now the only company with the necessary drawings and technical data package to repair the FQI assembly. Furthermore, the Government does not own the rights to the data required to repair this assembly. In an effort to http://www4.law.cornell.edu/uscode/html/uscode10/usc_sec_10_00002304----000-.html http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/Far/06.htm%23P77_9982 circumvent this limitation, the 411 SCMS/GULD contacted Ontic Engineering and Manufacturing via telephone and e-mail on 16 Feb 2012 to inquire about the potential purchase of data rights. Ontic replied on 20 Feb 12 stating that they were not willing to sell data rights to the Government. The 411 SCMS/GULD sent a more recent request to Ontic Engineering on 3 March 2014 requesting their willingness to sell data to the Government and a follow-up request again on 31 March 2014. On 1 April 2014 Ontic responded stating they are not interested in selling the technical data or the rights to the technical data. This means that the technical data package, specifications, and engineering description suitable for Full and Open Competition cannot be developed without reverse-engineering the system. However as stated in Section XI below, since the contractor has never agreed to sell data to the Government to enable a competitive environment for this asset, the HH-60G System Program Office (SPO) awarded a contract to Mercer Engineering Research Center (MERC) for $1.48M to produce a Technical Data Package (TDP) and design and re-engineer a prototype Fuel Quantity Indicator to address and resolve current and future obsolesnece issues. On 29 Apr 2013 MERC successfully delivered the TDP and two fully functioning Form Fit and Function prototypes. The Government does not anticipate a multi-year follow on repair requirement to this 5-year repair effort. A small purchase repair reqirement may be needed to bridge the gap between full installation of the new EFQI and the expiration of this effort anticipated to last to May 2020. As HH-60 aircraft are fitted with the new EFQI, current FQI spares requirements will decrease and enable available spares to support non-retrofitted HH-60s until all HH-60s modified. However, the Program Office will continue their attempts to procure data by requesting within the company; should a proposal be provided, the Program Office will budget for the funds to procure data if it makes economic sense to do so. Additionally, the current has obsolescence issues that are expected to increase the longer the system is used without replacing. Government strategy is to replace the FQI with the EFQI rather than spend Government funds to reverse engineer an obsolete. Its estimated to take 8 to 12 years (CY2022 to CY2026) to reverse engineer the current FQI, develop the repair data and flight test a repaired asset, award a full and open repair contract, deliver the First Article Test Report, and receive the first deliveries of repaired assets from the contractor. By then the HH-60G fleet is estimated to have the EFQI installed. The FQI will likely be un-supportable due to continued obsolescence issues before any competitive repair contract can be realized.

Award Engineering Services Contract, 18 ~ 24 months

18 ~ 24 months

Deliver Drawing/ Prototype, 18 ~ 24

Deliver Test & Repair Data, 12 ~ 18 months

Aircraft availability for Flight Testing, 24 ~ 36

Execute DT&E / OT&E Flight test, 6 ~ 12 months

24 ~ 36 months

54 ~ 78 months

48 ~ 66 months

36 ~ 48 months

Award F&O contract, 24 ~ 36 months

Deliver First Article Test Report, 12 ~ 18 months

Deliver Assets, 6 ~ 12 months

78 ~ 114 months

90 ~ 132 months

96 ~ 144 months

1116063472C Highlight

The current design of these items has enabled successful operation of the aircraft since the introduction of this assembly Accordingly, Ontic Engineering and Manufacturing, CAGE 45934 is the only source capable of providing the supplies and services described in Section 3 (above) without the U.S. Air Force experiencing substantial delays, which would jeopardize the feasibility of execution and overall success of delivering the needed capabilities to the war-fighter.

VI. EFFORTS TO ADD ADDITIONAL SOURCES/SOLICIT FROM AS MANY

SOURCES AS POSSIBLE

This requirement will be synopsized on the Federal Business Opportunities (FedBizOpps) web page as required by FAR 5.201. It is anticipated that sources having an interest in subcontracting may be identified through synopsis. Although the Government does not own data to support acquisition of this asset from any other source, any source who responds to the Government as a result of this 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. Price analysis will be utilized if possible. If not, the contractor will be required to provide other than cost or pricing data to support the government’s evaluation of the proposed cost IAW FAR 15.403-4. The proposed cost elements will be negotiated by the government based on recommendations from the Defense Contract Audit Agency (DCAA)/Defense Contract Management Agency (DCMA), and local pricing 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 pursuant to FAR 10.001 and 10.002. Market Research Techniques used include searching for technical data in JEDMICS, procurement history, System for Award Management (SAM), and ThomasNet.com database web site. Market Research conducted 15 Nov 2013 and updated 28 March 2014.Based on available information and engineering knowledge of the item and the aerospace industry, the only viable source for the repair of this part is Ontic Engineering and Manufacturing. No small business and no small disadvantage opportunities can be met concerning the acquisition of this repair service.

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

AND OPEN COMPETITION

The risk and cost far outweigh the benefits that could be realized by the Government.

The identified source is the only source with adequate technical data. Due to proprietary design of the FQI and the lack of data to compete this requirement, there are no other potential sources. The Government’s need cannot be met by any other source.

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

A Cost Benefits Analysis was performed in 2007 under SORA 05-001 and it was estimated to cost the Government at leat $2M to reverse engineer the system in order to develop a Technical Data Package adequate for Depot Level Repair of the current system. The HH-60G System Program Office (SPO) awarded contract FA8504-08-G- 0001-0005 on 23 Sep 2008 to develop and produce a Technical Data Package (TDP) for a replacement Fuel Quantity Indicator along with a prototype Fuel Quantity Indicator. The contract awarded to Mercer Engineering Research Center (MERC) for $1.48M. On 29 Apr 2013 MERC successfully delivered the TDP and two fully functioning Form Fit and Function prototypes. Feilding of the new FQI will be through attrition and require a small dollar modification to the helicopter to install a wiring kit. The repair strategy for this new replacement FQI will be either through Full and Open Competition or possibly be through Organic repair. However, development of depot level repair procedures using the delivered technical data is required prior to organic or commercial repair of this system.

Estimate the new FQI to begin installation on USAF HH-60G fleet around Jul 2014 and complete on entire USAF HH-60G fleet around 2024. Therefore, repair coverage for the current FQI system will be required at least until 2024 when the SPO estimates complete HH-60G fleet will have the new FQI system through attrition.

XII. CONTRACTING OFFICER’S CERTIFICATION

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

http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/Far/06.htm%23P204_28777 http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/Far/06.htm%23P204_28777