FA8681-14-0028_J_A.pdf

FD2020-12-77178

10 December 1012

COORDINATION AND APPROVAL DOCUMENT

Contracting Activity: FA8213 (Hill AFB) aod FA8681 (Eglin AFB) Purchase Request Number: FD2020-12-77178 Program Name: Joint Direct Attack Munition (JDAM) Est.imated Contracts Cost: $1.144B Type Program: PEO (ACAT IC) Authority: 10 D,S,C, 2304(c)(I), as implemented by FAR 6,302-1 Type J&A: Class

COORDINATION:

12/17/2012

Program Manager/ Requirements Initiator

12(17/2012

Contracting Officer

Local Legal Review

Competition Advocate

Program Executive Officer

12/18/2012

12/18/2012

1/9/2013

10 December 2012

JUSTIFICATION FOR OTHER

THAN FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITIES:

United States Air Force

AFLCMC/EBHKA

6033 Elm Lane, Bldg 1247 Hill AFB UT 84056-5819 Contracting Officer: Ms. Katie Barker Phone Number: 801-777-8403 PR Number: FD2020-12-77178

United States Air Force

AFLCMC/EBDK

207 West D Ave, Bldg 350 Eglin AFB FL 32542 Contracting Officer: Mr. Ron Foskey Phone Number: 850-883-3542 PR Number: Not determined

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

A.

. This procurement is in support of US Air Force

(USAF) and US Navy (USN) requirements and will be managed by the JDAM program offices. Contract will be awarded to the McDonnell Douglas Corporation (A wholly owned subsidiary of the Boeing Company), 6200 JS McDonnell Blvd., Saint Louis MO 63134, CAGE Code 76301.

B.

To date, Eglin AFB has been responsible for procuring JDAMs. The JDAM Transition Support Plan (TSP) transferred System Program Manager (SPM) duties from Eglin to Hill AFB, 30 June 2012. As part of the transition plan, Eglin will retain management of a portion of the JDAM technical support services. These support services will be procured as a separate contract managed within the Air Armament Directorate, but are also covered in this class J&A. The Eglin JDAM team anticipates award of a 5 year ID/IQ contract utilizing primarily CPFF and FFP CLINs. The anticipated award date is in April 2015 with performance expected through April 2019 .

C. Type J&A: Class

III. DESCRIPTION OF THE SUPPLIES/SERVICES REQUIRED MEETING THE

AGENCY’S NEEDS:

A.

B. The technical support services for the JDAM weapon system provides the engineering, management and logistic support required to ensure the continued Operational Safety, Suitability, and Effectiveness (OSS&E) of JDAM weapons in-accordance-with (IAW) AFI 63-1201. These services also provide the necessary resources to effectively assess the warfighter’s requests for potential enhancements and performance growth, as well as properly manage the ongoing production and sustainment activities. Technical support services include: simulations/modeling, lot acceptance testing and WSEP technical support, aircraft integration technical support, non-warranty repair actions funded from separate Operations and Maintenance (O&M) accounts, software maintenance/upgrades, assessments of impacts such as changes in GPS infrastructure, and studies and analyses related to current and future expansion of JDAM system performance. The estimated yearly required funding for technical support services, through the completion of planned production, is listed below.

C. IDIQ Fiscal Year Breakout: Estimated Funding per FY (in Millions)

IDIQ Fiscal Year Breakout: Estimated Quantities per FY

D.

Repair requirements, as part of Technical Support Services, will be funded with BP3400 (O&M) appropriated funds.

IV. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION:

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 THE CONTRACTOR’S UNIQUE QUALIFICATIONS

OR NATURE OF THE ACQUISITION REQUIRES THE USE OF AUTHORITY CITED

ABOVE (APPLICABILITY OF AUTHORITY):

A. This contract is for the production of a major system. The JDAM weapon system is designated as an ACAT IC program within the Weapons Program Executive Officer’s (PEO) portfolio. The current approved JDAM class J&A supports JDAM production lots 12-17 and associated technical support services and will expire in FY13. The current sole source contracts issued under that J&A are as follows: JDAM Production (FA8681-08-C-0001;

period of performance (POP) for last production lot ends March 2015) and JDAM technical support services (F08635-03-D-0007; period of performance ends December 2013). The baseline JDAM weapon system is designed, built, tested, produced and supported by Boeing and has been since 1995. The JDAM flight software is custom-designed by Boeing to achieve the Government's performance requirements and constraints as defined in the JDAM system specification. The design is based on Boeing's unique experience with the JDAM weapon system, its major and minor components, and GFE (such as warhead design and as-built characteristics). The design also incorporates Boeing's independently-created navigation and autopilot designs, which take advantage of their long experience with various guided weapon systems and their integration with carrier aircraft.

The technical support services needed to maintain the OSS&E of JDAM are intrinsic to the hardware and software designs of the system. The Government does not own the data package necessary to produce the JDAM tail kit nor the necessary support equipment, skill sets, or facilities necessary to provide technical support/maintenance for the weapon system.

Boeing is also the only source who possesses the necessary special test/inspection/ maintenance equipment, flight simulation models and computer programs to provide the required technical support services and analysis. For a second source to provide technical services and analysis for JDAM weapons, the Government would have to obtain delivery of additional data, including certain form, fit and function data and other data necessary for Operations, Maintenance, Installation and Training (OMIT) purposes, as well as source code and applicable technical drawing packages with Government purpose or unlimited rights, which per section V. B., are not for sale at this time. Also, any maintenance repair services performed by an alternate source would void the 20 year warranty purchased by the Government. Boeing has provided production Lots 1-17 and is the only source capable of providing JDAM tail kits and applicable technical support services. Therefore, this class J&A will cover the follow-on contracts for the continued production and associated technical support services of this major system.

B. Based on analysis stated below, award to any other source would result in substantial duplication of cost and unacceptable delays in fulfilling the USAF and USN requirements that is not expected to be recovered through competition.

Duplication of Cost: As part of the original JDAM Engineering and Manufacturing Development (EMD) contract (F08626-94-C-0003), the Government invested $318.4M. In 1995, the JDAM program was Congressionally designated as a Defense Acquisition Pilot Program, resulting in an arrangement where the Government agreed to limited program oversight. As part of that arrangement, the Government agreed to limit rights to the technical data being developed and waived Rights in Technical Data clauses. At the present time, the government has limited/restricted rights to the technical data of the JDAM weapon system.

Without sufficient licensing rights to the technical data, it is impossible for the government to provide this information to other contractors and foster a competitive procurement environment. The government has the following rights:

C.

D.

E. Also, delaying award for Technical Support Services would risk losing the expertise needed to support/troubleshoot urgent combat operations, causing additional system downtime. Any issues found during combat operations are immediately addressed under the Technical Support Services contract with the contractor. Delay in contract award would negatively impact the warfighters’ ability to troubleshoot weapon issues, causing a decrease in mission reliability and effectiveness.

F. Accordingly, Boeing is the only firm capable of providing the supplies and services described in Section III above without the Government experiencing unacceptable delays in fulfilling JDAM procurement requirements and substantial duplication of cost that could not be expected to be recovered through competition.

VI. DESCRIPTION OR EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS DEEMED PRACTICABLE:

A. Sources Sought Synopsis: Hill AFB Contracting issued a sources sought synopsis on 20 July

2011, # FA8213-11-R-3026. The Synopsis described the acquisition of a follow-on production contract for the JDAM weapon system, with an estimated contract award of January 2014, and included the estimated quantities the JDAM SPO planned to procure. The scope of the synopsis matches the item descriptions in Section III of this class J&A. The contracting officer also attached a Source Approval Request Plan applicable to the Sources Sought and requested all interested offerors coordinate information requests through the contracting officer. Seven companies formally responded to the Sources Sought:

1. Boeing responded to the Sources Sought on 17 October 2011 with a “Notice of Intent to Qualify” letter. See additional information regarding “industry day” in Section VIII of this document.

2. Lockheed Martin responded to the Sources Sought and on 18 October 2011, the

JDAM contracting officer received a “Notification of No-intent to Qualify” from

Lockheed Martin. See additional information regarding “industry day” in Section VIII of this document.

3. Raytheon responded and on 18 October 2011, the JDAM contracting officer received a letter stating “that the Raytheon Company intends to qualify to become a source of supply for JDAM weapon systems.” On 4 November, the JDAM contracting officer received a Source Approval Request plan as well as a request for additional information from Raytheon.

On 27 April 2012, Raytheon submitted a letter indicating, …please be advised that Raytheon will not be moving forward in qualifying a design pursuant to the subject solicitation.” See additional information regarding “industry day” in Section VIII of this document.

4. Deltek responded to the Sources Sought and on 24 October 2011 the JDAM contracting officer received an email from Deltek stating, “We will not be seeking a position as a prime contractor.”

5. API Defense responded to the sources sought and on 31 May 2012 the JDAM contracting officer received an email from API Defense stating, “API Defense is not interested in pursuing this as a prime..”

6. Systron Donner Inertial (SDI) responded and on 19 October 2011 the JDAM contracting officer received an email from SDI stating, “At this time, SDI does not possess an integrated missile assembly for this program.”

7. Faxon Machining responded and the Hill Contracting officer received an email from

Faxon on 21 October 2011 stating they are only interested in working with the prime contractor. The JDAM SPO directed Faxon to the current JDAM manufacturer.

B. An addendum to the sources sought synopsis was posted on 14 May 2012. The addendum added the requirement for JDAM technical services. Currently, Boeing provides technical services described in Section III B of this document to support JDAM production. However, the original sources sought did not include the requirement to provide technical support services for JDAM in error, so an addendum was issued. On 17 May 2012, Boeing submitted a response to the amended sources sought stating, “Boeing looks forward to continuing this relationship with Eglin and our new Hill Air Force Base Partners in contracting the FY12- Production Tail Kits.” Boeing described the current production and technical service tasks they perform for the JDAM program. No other respondents replied to the amended sources sought.

C. This requirement will be synopsized in FedBizOpps, as a notice of proposed contract action IAW FAR 5.201. If other sources express interest as a result of this synopsis or other actions, they will be listed in the official contract file.

D. Other Actions: None

E. Qualifying Country Sources: None

VII. DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE:

The following steps will be taken to ensure that the anticipated cost of this acquisition will be fair and reasonable. The Contracting Officer will comply with the procedures and criteria contained in Federal Acquisition Regulation (FAR) under Part 30 - Cost Accounting Standards, Part 31 - Contract Cost Principles and Procedures, Subparts 15.4 - Contract Pricing; to include technical evaluations and DCMA/DCAA audits, as appropriate. Additional steps to ensure price reasonableness will be under the guidance of the Contract Pricing Reference Guides, jointly developed by the Federal Acquisition Institute and the Air Force Institute of Technology. The contracting office will obtain certified cost and pricing data IAW FAR Subpart 15.403. The final step is to include the Price Negotiation Memorandum (PNM). This detailed documentation and justification of price reasonableness will be disclosed in the official PNM, to be prepared upon completion of negotiations.

VIII. DESCRIPTION OF MARKET RESEARCH CONDUCTED AND THE RESULTS,

OR A STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT

CONDUCTED:

A. As described in Section VI above, 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.

B. Based on the number of responses to the Sources Sought, the JDAM SPO decided to hold an industry day on 4 October 2011 to assess the current market and industry capability. Of the companies that responded to the Sources Sought, only three attended industry day: Boeing, Lockheed Martin and Raytheon. Each company was given one-on-one time with the JDAM SPO to present their capabilities and ask questions. Each company showed interest in the requirement. The JDAM SPO gave the contractors until 4 November 2011 to submit their source approval request and meet the SPO’s requirement of contract award by January 2014.

As described in paragraph VI, Boeing is the only company that has expressed interest in the JDAM production lots 18+ and technical services requirement.

C. Additional Market Research included attending Worldwide Munitions Reviews, featuring a cross section of the weapon manufacturers (Sep 2011). Also, the JDAM SPO performs internet searches to examine other capabilities that could meet the JDAM performance and integration requirements. No other United States manufacturers were determined to meet these requirements.

D. IAW FAR Part 10, engineering has determined that there are not any commercial items or non-developmental items available that could be modified to satisfy the agency’s needs.

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

OPEN COMPETITION:

The Government does not have adequate data deliverables and rights to pursue a competitive strategy for the requirement described. The Government will continue to pursue additional technical data rights and investigate competitive opportunities for JDAM production and technical support in the future.

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 major barrier to competition for the JDAM program is the inability of the JDAM SPO to use technical data to compete the requirement. As noted in Section IX, the Government does not have adequate data deliverables and rights to pursue a competitive strategy. The Government also does own any of the technical data and previous inquiries to Boeing to purchase the data package have shown they are not willing to sell it. The JDAM SPO will continue to request the necessary data packages from Boeing and explore which aspects of the overall requirement may be rendered susceptible to competition in the future.

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)).