Redacted_J&A.pdf

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

Security Marking (select from the drop-down list)

March 2018 Security Marking (select from the drop-down list) Page 1 of 9

NOTE: If a Justification and Approval was approved for the preceding acquisition, a copy of the approved J&A for the predecessor action must be included in the staff package for approval of the instant J&A. This applies to J&A staff packages that are submitted for review and approval at a level above the contracting officer. The predecessor J&A will be used as a reference document by the approving official.

Is this a new or amended J&A Document? New Amended ( Prior to Award Only! )

Is this a Bridge Action as defined in the AF Bridge Action Reduction Plan? Yes No

Contracting Activity: AFSC/PZAAB

Purchase Request / Local ID Number: FD2060-18-00195

Program / Project (and PE, if applicable): Ground Collision Avoidance Computer (GCAC) Repair

Program Type (PEO or Other Contracting): Other Contracting

Authority: 6.302-1 – 10 USC 2304(c)(1), Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements

Estimated Contract Cost (including options): J&A Type: Class Individual

COORDINATION (AFFARS 5306.304(a) )

Date Project Lead / Program Mgr / Requiring Activity

Date

07 Aug 2018

Contracting Officer

Signature

Date Local Legal Reviewer

APPROVAL (AFFARS 5306.304(a) )

Date Competition Advocate

March 2018 Security Marking (select from the drop-down list) Page 2 of 9

I. Contracting Activity.

This Justification and Approval to request authority for Other Than Full and Open Competition (OTF&OC) supports requirements generated for the Air Force Sustainment Center (AFSC), 638 Supply Chain Management Group (SCMG), 409 Supply Chain Management Squadron (SCMS)/ GUMB. The contracting activity for this requirement is AFSC/PZAAB, Robins Air Force Base, GA 31098. The Purchase Request number supporting this contracting action is FD2060-18-00195.

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

Due to the circumstances described herein, the activity requests authority to repair the items 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 requirement is for the award of a new, Firm-Fixed-Price (FFP) Requirements Indefinite Delivery contract consisting of a 12 month basic and 4 annual option periods. This repair contract will support AFSC, United States Air Force (USAF), United States Air Force Reserve (USAFR), and United States Air National Guard (USANG) at the contractor depot repair facilities for the C-130 Ground Collision Avoidance System (GCAS).

This sole source requirement will be purchased from the following company:

International Enterprise, Inc. (IEI) 108 Allen Street Talladega, Alabama 35160-1302

CAGE CODE: 50218

Large Business

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

This requirement is for the depot-level repair source for the C-130 AN/ASN 167(v) Ground Collision Avoidance Computer (GCAC). Services shall include maintenance services, supply support, inventory management, and repair of recoverable items, packaging, handling, storage, transportation and data collection. The purpose of this process is to enhance supportability of the GCAC and ultimately that of the C-130 aircraft.

This acquisition is in support of the United States Air Force (USAF) by providing a continued flow of serviceable assets to the warfighter. The projected requirements are shown below:

National Stock Number BEQ Cost/Unit Total

BASIC

5841-01-463-3343LG 50

5841-01-449-9255LG 50

NFF 1

BER 1

Over & Above 1

TOTAL BASIC

OPTION I

March 2018 Security Marking (select from the drop-down list) Page 3 of 9

5841-01-463-3343LG 40

5841-01-449-9255LG 40

NFF 1

BER 1

Over & Above 1

TOTAL OPTION I

OPTION II

5841-01-463-3343LG 40

5841-01-449-9255LG 40

NFF 1

BER 1

TOTAL OPTION II

OPTION III

5841-01-463-3343LG 40

5841-01-449-9255LG 40

NFF 1

BER 1

TOTAL OPTION III

OPTION IV

5841-01-463-3343LG 20

5841-01-449-9255LG 20

NFF 1

BER 1

Over & Above 1

TOTAL OPTION IV

TOTAL ESTIMATED VALUE:

The total estimated value of this acquisition is . The repair cost estimates are derived from negotiated repair pricing on current USAF contract, FA8538-16-D-0018, including a 3% inflation factor. Any combination of the two listed NSNs can make up the best estimated quantity (BEQ). The type of appropriation for the repair of NSNs is Consolidated Sustainment Activity Group (CSAG) 4930. The period of performance is for a total of 60 months, which consists of a 12 month Basic and 4 annual option periods. Award of this acquisition is anticipated to be 30 September 2018, with POP through 29 September 2023. Delivery of the assets is 30 days after receipt of order.

Both NSNs included in this effort have an Air Force Material Command, AFMC Form 762 Contract Repair Screening Analysis Worksheet, Repair Method Code (RMC) and Repair Method Suffix Code

March 2018 Security Marking (select from the drop-down list) Page 4 of 9

(RMSC) that indicate a sole source requirement.

The RMC/RMSC Codes are R5/R.

RMC: R5 Repair directly from a sole source contractor which is not the actual manufacturer.

RMSC: R The government does not own the data or 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.

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

10 U.S.C. 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).

The GCAC is a critical application item that is essential to weapon system performance and operation.

The services required for this acquisition serve the purpose of enhancing supportability of the GCAC and ultimately that of the C-130 aircraft. The GCAC is currently installed on 490 C-130 aircraft and is exclusive to the C-130 fleet. Continued sustainment and repair is necessary in order to support mission over the next 11 years. The C-130 life cycle is through 2040, however the GCAC will be replaced on the C-130 with the Avionics Modernization Program (AMP) Increment 2 by 2028. This will be an embedded system within the mission computer.

The critical significance of the GCAC is its ability to provide visual and aural warnings to the pilot and copilot that help identify the cause of a warning and take appropriate action to prevent a crash.

Currently the specific design process used for manufacturing the GCAC has become obsolete; parts obsolescence problems are being experienced by the Government. Test equipment that is in marginal condition or technicians that lack seasoned proficiency in the repair of GCAC can destroy next higher assembly and thus affect cost and schedule for end item repair. There are currently no new technologies applicable to testing that could provide an affordable best value alternative to the current design. The GCAS is listed on the minimum essential list (MEL) of equipment required for the C-130 aircraft and is congressionally mandated; no troops or passengers may be carried on the C-130 without an operational GCAC engaged. As such this acquisition is necessary for continued performance in order to support mission requirements.

Given the criticality of this item, the agency's minimum needs can only be satisfied by the unique services available from International Enterprise, Inc. as demonstrated in the following paragraphs. IEI possesses the skilled employees, equipment, facilities, repair data, and processes necessary to perform this requirement via a license agreement finalized with Honeywell International Inc. in August 2017.

Honeywell International, Inc. is the Original Equipment Manufacturer (OEM) of the GCAC and is currently providing repair services for the GCAC managed by Robins Air Force Base via contract FA8538-16-D-0018 which is set to expire 29 September 2018.

Honeywell International, Inc. has been the only source to possess the expertise, facilities, equipment, repair data, proprietary data rights on software and depot level manuals to provide repair support of

March 2018 Security Marking (select from the drop-down list) Page 5 of 9 the NSNs covered for this requirement. In response to a GCAS redesign effort initiated in December 2016, Honeywell International Inc. provided a white paper in March 2017 which advised the Government of their intention to remove themselves from the repair services specific to the GCAC.

They maintained that they would only provide sustainment services of both the Air Data Computer (ADC) and the Ground Proximity Warning System (GPWS).

The Government does not own the data or the rights to the data needed to contract repair the GCAC from additional sources. The data needed to compete contract repair is not physically available, it cannot be obtained economically, nor is it possible to draft adequate specifications or any other adequate, economical description of the repair for a competitive solicitation. The Government also possesses no viable repair data on these items in its Joint Engineering Data Management Information and Control System (JEDMICS) repository or Technical Order Library. The Government has contacted Honeywell International Inc. multiple times, with the most recent being by email on 15 May 2015 and again on 30 Oct 2017. Honeywell International Inc. has repeatedly responded that they are unwilling to sell the repair data, proprietary software nor depot level manuals.

In accordance with System Engineering, reverse engineering is typically cost effective only if the item to be reverse-engineered will result in a high return in investment or the OEM is no longer willing or able to provide support. Return on investment cannot be justified, based on parts obsolescence and total system replacement through the Avionics Modernization Program (AMP). A reverse engineering redesign effort for the GCAS was conducted due to obsolescence issues in 2017 for an estimated cost of . This RE redesign effort was based on a similar RE effort of the Advanced Lighting Control System and consisted of qualification and production of the GCAS. The redesign effort of the GCAS specifically required the development and qualification of a Form, Fit, Function and Interface (F3I) of three (3) GCACs and three (3) ADCs that would be a compatible replacement for the legacy GCAS on the C-130 aircraft. It included a total of six (6) Line-Replaceable Units (LRUs), development of six

(6) prototypes, a technical data package (TDP), and an updated GCAS Item Specification List. The competitive solicitation was released (FA8538-17-R-00023) in which the Government received zero

(0) bids from industry. The effort was subsequently canceled.

An additional reverse engineering estimate and return on investment analysis was done while utilizing government certified facilities in October 2017. This RE effort was for 1 A condition GCAC, Technical Data Package (TDP) for depot stand‐up of GCAC, and Depot level maintenance instructions with IPB. Based on past official estimates, funding this type of effort will take approximately 21 months, with the estimated cost being . A breakeven analysis was performed by AFSC/ FZC-R on the subject NSNs using the Sole Source and Reverse Engineering alternatives. The following assumptions were used within the analysis:

• All costs within the analysis are in BY2017$. Costs provided are considered TY costs and were converted to BY2017$ using 2017 USAF Raw and Weighted Indices for 3400 Operations and Maintenance, Non-Pay.

• The analysis period is years, FY2018-2027, based on the expected service life of the subject NSNs.

• Annual repair costs are based on the FY2016 repair price adjusted for inflation. Repair

March 2018 Security Marking (select from the drop-down list) Page 6 of 9 quantities are based on two separate NSNs, and are used for the duration of the period of analysis (FY2018-2027). Repair quantities were generated based on 2016 contract requirements from FA8538-16-D-0018. Those quantities are used as the average for each year of this analysis.

• Reverse engineering effort requires years. Investment costs are based on engineers working for years to develop the technical data package and approve the prototype.

These cost are based on the FY2017 quote provided by 402 EMXG/MXDEK, were adjusted for inflation, and spread evenly across the year effort (FY2018- 2019).

• While the reverse engineering effort is being accomplished, analysis assumes repairs are sole source (FY2018-2019).

• Once a new source is qualified, repair costs are reduced by based on estimated savings due to competition (FY2018-2027).

The Savings/Investment Ratio (SIR) and Payback Period are provided below. A desired SIR is or greater, indicating that for every dollar invested, a dollar or more is earned as a return on investment.

The Payback Period indicates how many years it takes to recoup dollars invested.

a. SIR = ( return on every dollar invested).

b. Payback Period = years

Based on the analysis, the savings gained through competition does not offset the costs of reverse engineering within the year analysis.

Accordingly, International Enterprise, Inc. is the only capable source of providing the supplies and services for this instant acquisition without the USAF experiencing unacceptable delays and duplication of cost in fulfilling its requirements.

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

This requirement will be synopsized on the Federal Business Opportunities (FedBizOpps) website as required by FAR 5.201. Although the Government does not own the data to support acquisition of these components from any other source, any source who responds to the Government because of this synopsis will be identified to the prime contractor as a potential source for subcontracting possibilities.

Request for Sources Sought Synopsis (SSS)/Request for Information (RFI) for Non-competitive Repair of C-130 AN/ASN-157 (V) Ground Collision Avoidance Computer (GCAC) was posted to FedBizOpps on 29 Sep 2017 resulting with one response (International Enterprise, Inc.) by close of business 31 Oct 2017.

March 2018 Security Marking (select from the drop-down list) Page 7 of 9

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, it is anticipated that negotiations will be conducted using data other than cost or pricing data from the contractor. Thorough price analysis and/or cost analysis will be conducted using available information and approved pricing techniques that will support the contracting office in making a determination that the price paid is fair and reasonable to the Government and the Contractor.

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 and completed on 16 November 2017 in accordance with FAR Part

10. The following market research techniques were used:

Thorough searches were conducted within government data bases, combined with various Internet searches (IHS Haystack, GSA Advantage, Google) for part/national stock numbers and item description for potential sources.

A Small Business (SB) Search was performed to specifically find SB vendors that may be capable of repairing these items. A search for HUB zone and service disabled and all subcategories of small businesses was conducted using the Dynamic Small Business Search Engine (http://dsbs.sba.gov/dsbs/ search/dsp_dsbs.cfm), using criteria consisting of keywords (Ground Collision Avoidance System) pertaining to the item descriptions and the NAICS code 334511. Results from the search indicated there are no potential opportunities for small business set asides and/or direct awards in support of this requirement.

Market Research reflected that the GCAC is a commercially available product from the OEM, Honeywell International, Inc. It has many versions and is used by both the military and the commercial aviation industry. The repair service specific to the GCAC is considered non-commercial based on the definition of a “Commercial Item” in accordance with FAR 2.101.

E-mail correspondence was exchanged with the OEM to determine the present status of the item and repair service. These emails as well as additional forms of communication led to a white paper submitted by Honeywell International Inc. on 22 March 2017 in which they provided the Government with alternative repair solutions given Honeywell was no longer able to perform repair activity associated with the GCAC. Honeywell International Inc., advised in this paper their intention to finalize a license agreement with IEI, in which Honeywell would provide IEI access to all proprietary data and equipment associated with the repair of the GCAC. This license agreement was finalized in August 2017.

Request for Sources Sought Synopsis (SSS)/Request for Information (RFI) for Non-competitive Repair of C-130 AN/ASN-157 (V) Ground Collision Avoidance Computer (GCAC) was posted to FedBizOpps on 29 Sep 2017 resulting with one response (International Enterprise, Inc.) by close of business 31 Oct 2017.

March 2018 Security Marking (select from the drop-down list) Page 8 of 9

The Market Research concluded that International Enterprise, Inc. is the only viable source to successfully fulfill this instant repair acquisition. This conclusion is based on IEI's license agreement held with Honeywell International Inc. in which proprietary access has been granted to IEI for the repair manuals and testing equipment necessary to repair the GCAC. Honeywell International Inc. is unwilling to provide repair service for the GCAC but has provided the Government with an alternative solution through IEI.

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 Ground Collision Avoidance Computer is planned for service until 2028. In accordance with Systems Engineering, reverse engineering is typically cost effective only if the item to be reverse engineered will result in a high return in investment or the OEM is no longer willing or able to provide support. A reverse engineering effort is estimated to cost for the development of a TDP and the actual repair of the GCAC. Based on the breakeven analysis conducted, the savings gained through competition does not offset the costs of reverse engineering within the ten year analysis. Market surveillance will continue through the monitoring of technical literature, discussion with other engineers and attendance at expos for potential repair sources/suppliers of the subject NSNs.

While the current market research indicates a sole source environment for the repair of the GCAC, the Government will continue to engage with the OEM, Honeywell International Inc. on an annual basis, prior to the exercise of each option period with IEI to determine the feasibility of procuring the data rights in order to promote full and open competition. As of 30 Oct 2017, Honeywell International Inc.

is unwilling to sell the technical data package or rights to it.

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.

March 2018 Security Marking (select from the drop-down list) Page 9 of 9