Signed_ADCP_II_JA_Redacted.pdf

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITY

Department of the Air Force Air Force Materiel Command Air Force Life Cycle Management Center F-15 Program Office (AFLCMC/WWQ) Bldg 556, Area B 2690 West Loop Road Wright-Patterson AFB, OH 45433-7148

This is a Class Justification and Approval (J&A) for Other than Full and Open Competition.

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

This Class J&A authorizes the use of other than Full and Open Competition for the acquisition of the Advanced Display Core Processor II (ADCP II) system for the F-15 aircraft. This class J&A is consistent with the approved ADCP II acquisition strategy (8 Oct 13). This effort will be a predominately fixed price new stand-alone contract with options, covering requirements to complete the production, installation and Interim Contractor Support (ICS) of the ADCP II system for the USAF F-15 fleet. Past experience has shown that the prime contractor may add an unreasonable inflation factor for work proposed beyond three years. Recently a major subcontractor refused to bid on work beyond three years due to their inability to accurately forecast cost. Therefore, multiple contracts may be required to complete the Low Rate Initial Production (LRIP) (Lot 1) and Full Rate Production (FRP) (Lots 2-3 and Lots 4-5) with ICS included in each separate contract action. The quantities and phasing of the contract actions are depicted in the table and chart at Section III. The contract(s) will be awarded to The Boeing Company (formerly McDonnell Douglas), St. Louis, Missouri, the original equipment manufacturer of the F-15.

III. DESCRIPTION OF THE SUPPLIES/SERVICES REQUIRED TO MEET THE

AGENCY’S NEEDS

The ADCP II is the new F-15 multi-processor mission computer that drives the Operational Flight Program (OFP) as well as displays for radar and other pilot-vehicle interfaces. The system consists of the mission computer Line Replaceable Unit (LRU), display upgrade, and the re-hosting of a common OFP. The contractor will produce ADCP II install kits, perform installation, conduct checkouts including classified functions, develop technical orders, conduct maintenance training, manage configuration control, resolve diminishing manufacturing sources issues, and maintain overall F-15 fleet integration.

The F-15 aircraft is a system of systems in which the ADCP II is the central computer that accomplishes all mission processing. This mission critical subsystem is both complex and highly specialized as it must seamlessly integrate with other mission systems on the aircraft to include radars, OFP, and Eagle Passive/Active Warning Survivability System (EPAWSS). The ADCP II production system upgrade provides future growth in air-to-air weapons and OFP capability, eliminates processing/display limitations, and provides greater processing, throughput, and memory to meet increased resource demands required to implement new and existing subsystem capabilities. ADCP II is an Acquisition Category (ACAT) II program in its Engineering and Manufacturing Development (EMD) phase that is currently being executed as a sole source effort with Boeing utilizing the Eagle TALON ID/IQ contract (F33657-01-D-0026) under the authority to the Eagle TALON J&A No. 02-JA-020 dated 6 Feb 02. The EMD contract (Delivery Order 0109 under Eagle TALON) was awarded on 19 Nov 2012, definitized on 13 Mar 2014, and has a period of performance that ends on 30 Oct 2017. As the integrator, Boeing has been awarded delivery orders under the ID/IQ contract to develop the ADCP II system including development and integration of a common LRU modification kit and OFP capable for use in the entire F-15 fleet.

This Class J&A will authorize a contract(s) for LRIP lots, FRP lots, and ICS required to successfully execute the ADCP II program in the production and deployment phase and field the capability on the F-15 fleet.

The requested $479M J&A ceiling is based on: the 2013 F-15 ADCP II Program Office Estimate for production and deployment, previous obligation history, current activities, and in-house estimates for future projected requirements. $479M is expected to be sufficient to complete the fleet upgrade and accommodate flexibility for future force structure decisions. The production and deployment phase of the ADCP II will take several years to complete, thus requiring the obligation and expenditure of funds over multiple fiscal years. The individual annual dollar amounts depicted below are estimates only, and subject to change based on funding and aircraft availability. The overall period of performance cap is FY23.

IV. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION

All contracting actions covered by this Class J&A fall within the authority found at 10 USC 2304(c)(l), as implemented by FAR 6.302- l(a)(2)(ii) -- 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)

Since its inception the ADCP II program has been a sole source effort to Boeing pursuant to FAR 6.302-1 and is within scope of the previously referenced F-15 Eagle TALON J&A. Boeing continues to be the only source capable of performing the integration and verification effort of this program. Only Boeing possesses the unique and highly specialized capabilities and qualifications necessary to successfully complete the F-15 ADCP II system upgrades. As the sole source producer and prime integrator of this system, Boeing is the only contractor in possession of the technical expertise, documentation and detailed knowledge of the F-15 weapon system (i.e., operations, design, facilities and tooling, configuration, manufacturing processes, integration of the aircraft avionics and maintenance support procedures) to successfully perform these activities. Furthermore, the classified requirements of the ADCP II program add a level of complexity that Boeing is uniquely qualified to manage.

Boeing is currently on contract to complete all ADCP II development activities through delivery of qualified modification kits. The EMD contract (Delivery Order 0109 under Eagle TALON) was awarded on 19 Nov 2012, definitized on 13 Mar 2014, and has a period of performance that ends on 30 Oct 2017. This acquisition is a follow-on to the EMD effort for the continued production and fielding of this highly specialized major subsystem. Due to the complexity and specialized requirements, only the modification kit developer is positioned to produce the ADCP II modification kits without unreasonable re-work and delay.

The F-15 Program Office (PO) asserts 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 would also result in unacceptable delays in fulfilling the USAF's requirements. Duplication or transference of the capabilities possessed by Boeing would be schedule and cost prohibitive.

The anticipated delay of qualifying a new F-15 ADCP II integrator and potentially qualifying another ADCP II system will prohibit the program from achieving critical Warfighter milestones for Required Asset Availability (RAA).

The PO anticipates that it would take over five years to qualify another source (1 year to procure and collect the re-procurement data and develop the request for proposal, 18 months for a source selection, 2.5 years for a new contractor to develop the infrastructure and manufacturing processes required to produce the ADCP II upgrade), and this would result in schedule delays of at least five years in meeting the RAA commitment. This estimate is based on the time between the award of the ADCP II Pre-EMD contract in FY11 to the estimated completion of EMD. Introducing another contractor or a Government entity to execute ADCP II production without these capabilities presents unacceptable risk into the overall weapon system management; particularly for mature, interdependent fielded systems.

The anticipated cost of qualifying a new F-15 ADCP II integrator along with the five (5) year schedule delay outlined above is estimated to be approximately . This estimate is based on the ADCP II, AFLCMC/FZC approved, 2013 Program Office Estimate (POE), ADCP II actuals, F-15 actuals/rates/factors, and analogous efforts. The cost of qualifying a new vendor includes: to develop new infrastructure and manufacturing processes calculated using of the EMD cost; in vendor set up costs/nonrecurring engineering (NRE) based on ADCP I actuals/engineering estimate, for a data reprocurement package using KC-46 adjusted actuals for Operations and Maintenance Installation and Training data, in Diminishing Manufacturing Sources based on F-15 Radar Modernization Program actuals and “to complete” costs, and for additional cost risk/uncertainty based on a factor for unknowns of qualifying a new vendor. The estimate also assumes five year program extension costs, which based on the 2013 POE, includes: for extended ICS (cost of repair times rate of repair times total production units), for Other Government Costs (such as Advisory & Assistance

Services and Program Management Administration costs) using ADCP II actuals and estimate to complete, for extended System Engineering and Program Management costs based on actuals and estimates to complete, for Engineering Change Orders (ECO) based on F-15 historical data and of extended profit costs using ADCP II’s EMD target profit rate of .

The Program Office (PO) also asserts that the support elements of this program can only be reasonably accomplished by Boeing under this J&A. ICS is currently covered by the previously awarded EMD task order through 2017. Since the ADCP II has been declared to be core, the PO will stand up an organic depot capability no later than 2023. At this time, no above core requirements are anticipated to require lifetime contractor logistics support. To bridge the gap between EMD and depot standup, the PO estimates that an ICS contract action of will be required under this J&A. Since the ICS will be comprised of vendor repairs of the ADCP II, stand up of an alternative source will require the same level of effort needed for production. The stand up of an alternative source in parallel with standing up the organic depot capability would be duplication of resources. Maintenance training would also be covered under this J&A for the same rationale. Since ADCP II is a new system, no third party vendors are available to provide training at this time. Classified aspects of the program also make it difficult to qualify another contractor.

Accordingly, Boeing is the only firm capable of providing the supplies and services described in Section III without the USAF experiencing substantial duplication of cost that could not be expected to be recovered through competition and unacceptable delays in fulfilling its requirements. Market research supports this assertion. As described in Section VI, market research was conducted by synopsis of the proposed acquisition and no responses were received.

The PO contends this is an indication the market agrees that Boeing is the only viable source.

Boeing’s strong connection to the F-15 weapon system includes levels of development, integration, and production experience that cannot reasonably be duplicated. Specifically, Boeing served as the EMD contractor responsible for developing and integrating the ADCP II into the F-15 weapon system demonstrating capability to manage this complex program and proving their ability to execute the production contract(s). Through their participation in ADCP II production planning meetings and Statement of Work reviews, Boeing demonstrates a willingness to accept responsibility for the ADCP II system production and deployment phase.

VI. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS DEEMED PRACTICABLE

A Sources Sought Synopsis (SSS) describing the F-15 ADCP II system production requirements was published on the Federal Business Opportunities (FBO) website on 19 Aug 14 under solicitation number FA8634-14-R-0001. The synopsis requested all interested sources to respond by providing: a description of existing relative experience; their capabilities to design, develop, integrate, fabricate, test, install, and support improvements to weapon systems to include handling of classified and unclassified material; qualifications of key personnel; their organizational structure; any information on existing facilities, including Transient Electromagnetic Pulse Emanation Standard facilities; any deficiencies in capabilities and proposed fix mitigations; and to provide similar information for major subcontractors to be utilized. The synopsis also requested recommendations for use of an alternate North American Industry Classification System code and to identify any major performance, schedule or cost risks anticipated.

The ADCP II SSS was posted for a period of 30 days with all responses due back by 19 Sep 14, no responses were received.

VII. DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE

The F-15 Contracting Officer has determined that the Government can obtain and negotiate fair and reasonable prices for the ADCP II system, initial spares, and associated activities acquired sole source from Boeing. Thorough technical, price and cost analyses will be performed as necessary by the F-15 PO, the Defense Contract Audit Agency (DCAA) and the Defense Contract Management Agency (DCMA). Boeing will be required to furnish certified cost or pricing data for proposals meeting the threshold for submission of such data (FAR 15.403-4).

Assist audits, rate reviews, and other evaluations of major subcontracted efforts will be accomplished, as necessary, by the cognizant DCAA and DCMA organizations. DCAA and DCMA analyses will be combined with F-15 PO analyses and used in the substantiation of fair and reasonable prices. For those proposals not meeting the thresholds for submission of certified cost or pricing data, other than cost or pricing data will be obtained from the contractor in sufficient detail to support evaluation by means of cost analysis. The Contracting Officer will verify that the anticipated cost to the Government is fair and reasonable based on the enterprise assessment of this data.

VIII. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE

RESULTS, OR A STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT

CONDUCTED

As described in Section VI, market research in accordance with FAR Part 10 was conducted by synopsis of the proposed acquisition, advising industry of the pending acquisition and soliciting inquiries from interested parties. A SSS was posted on the FBO website on 19Aug14. No responses were received. The SSS requested all interested sources to respond by providing: a description of existing relative experience; their capabilities to design, develop, integrate, fabricate, test, install, and support improvements to weapon systems to include handling of classified and unclassified material; qualifications of key personnel; their organizational structure; any information on existing facilities, including Transient Electromagnetic Pulse Emanation Standard facilities; any deficiencies in capabilities and proposed fix mitigations; and to provide similar information for major subcontractors to be utilized. The synopsis also requested recommendations for use of an alternate North American Industry Classification System code and to identify any major performance, schedule or cost risks anticipated.

In addition, the F-15 PO reviewed existing internally controlled documentation of the current ADCP system, upgrade costs, and potential vendor alternatives for the F-15 ADCP II program.

Existing documentation used for this effort included products from recent trade studies and documented past experience with similar contracts, and discussions with other US Government personnel with previous similar Central Computer upgrade programs or other similar efforts for the F-15. Examples include the ADCP I, F-15 OFP and the F-15 Radar Modernization programs. As a result of the previous market research conducted in support of the contract award, Boeing was found to be the only appropriate integrating contractor for the F-15 aircraft.

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

OPEN COMPETITION

N/A

X. LIST OF SOURCES, IF ANY, THAT EXPRESSED INTEREST IN THE

ACQUISITION

As identified in Section VI, no other sources expressed interest in this acquisition.

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

This contract(s) is intended to complete the F-15 ADCP II system procurement and no future new production efforts are foreseen. Production and fielding of ADCP II is a non-recurring requirement. A Source of Repair Assignment directed an organic source of repair at which will be implemented through a public/private partnership. The Government will stand-up a depot capability and is acquiring sufficient data rights to support this decision. After interim contractor support, will assume responsibility for maintenance, repairs, and replacements with the transition currently planned to begin in FY22. In accordance with FAR Part 6, will competitively procure necessary spare parts to the maximum extent practicable in accordance with the local procedures using standard market research and procurement methods.

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 responsible for supplying the data have certified that any supporting data contained herein are both accurate and complete (FAR 6.303-2(c)).