Source Selection Information – See FAR 2.101 and 3.104

SSJ# 26-176

FSS SOLE SOURCE JUSTIFICATION (above SAT)

1. Identification of Requiring Activity and Contracting Activity.

This is a Sole Source Justification in accordance with GSAR 538.7104-3(b). The requiring activity is Naval Education and Training Command (NETPDC); the contracting activity is NAVSUP Fleet Logistics Center (FLC) Norfolk, Contracting Dept., Pentagon Directorate.

2. Nature and description of contract action. This acquisition is conducted under the authority of the Multiple Award Schedule Program (Title 41 U.S.C. 152 (3) and Title 40 U.S.C.

501, Services for Executive Agencies). This sole source action is to be awarded as a new Federal Supply Schedule task to Personnel Decisions Research Institute LLC (PDRI). The placement of a firm-fixed-price order is anticipated.

The action is considered a new requirement.

3. Description of Required Supplies/Services. The proposed acquisition is for a sole-source, firmed-fixed-price task order to PDRI for specialized psychometric services supporting the Navy Enlisted Advancement System (NEAS). It is intended to acquire expert psychometric, statistical, and test development support services for the Navy Advancement Center (NAC). These services are critical for ensuring the validity, reliability, and legal defensibility of the Navy’s enlisted advancement examinations.

Key deliverables include:

- Analysis of exam performance data.

- Development and equating of exams using Item Response Theory (IRT) modeling.

- Validation of exam content and scoring.

- Consultation on improvements to the NEAS.

- Application of proprietary statistical models to ensure exam integrity.

The period of performance shall be for one (1) Base Year of 12 months and four (4) one-year option periods and one (1) six-month option period thereafter IAW FAR 52.217-8.

4. Identification of the Justification Authority and Supporting Rationale.

The proposed requirement is to acquire expert psychometric, statistical, and test development support services for the Navy Advancement Center (NAC).

The statutory exception supporting the placement of an exceeding the SAT on a sole source basis is:

GSAR 538.7104-3(b)(1)(ii) – Only one source is capable of providing the products, services, or solution required at the level of quality required because the products, services, or solutions are unique or highly specialized.

PDRI is the only source capable of providing the requisite psychometric support that NETPDC requires. In order to meet the unique statistical and legacy system requirements of NEAS, PDRI can extensively configure its commercial, proprietary Palladium platform. Through specialized psychometric modeling and custom data-export pipelines, PDRI can adapt its commercial software to successfully integrate with the Navy’s Enlisted Advancement System (NEAS).

Because the underlying software architecture and these highly specialized configurations are proprietary to PDRI, no other vendor has the data rights or technical access required to maintain, execute, or update this solution without unacceptable delays and duplicated costs. The unique IRT algorithms required were created by PDRI and specifically address the unique challenges and data created by US Navy testing environments and rating populations.

Palladium is a proprietary, commercial SaaS platform developed internally by PDRI at their own private expense. The core programming is used by other federal agencies such as OPM, FDIC, and the USAF. PDRI owns the intellectual property for the core platform, combined with the highly specific, proprietary configurations they can develop to meet the Navy’s unique operational use case. The core Palladium engine (which handles item banking, test delivery, and Item Response Theory (IRT) scoring algorithms) was built by PDRI for the broader federal market, but because it is their proprietary system, no other vendor has access to the source code to modify, maintain, or host the platform. The way this modern cloud environment must interface with the Navy Enlisted Advancement System (NEAS) which operates on a legacy COBOL mainframe makes this requirement specific. To bridge this gap, PDRI can create a highly tailored, modular configuration for NEAS. Palladium calculates highly precise ability estimates (IRT scores) and, specifically for this case, calibrates the scoring data using Bayesian Modal Estimation to handle the small samples the Navy’s Rating Knowledge Exams are limited

by. Then they can securely serialize them into structured files that NEAS’s legacy batch-processing systems can ingest/read. This software is proprietary to PDRI. They are the only vendor capable of delivering, maintaining, and updating the system without the Navy having to completely rebuild the assessment and integration architecture from scratch, and a new vendor cannot modify PDRI’s software to interface with NEAS.

No other vendor possesses these validated mathematical models, which are essential for the development of equivalent exams and the continuation of the program without interruption. A new contractor would be required to recreate and redevelop all mathematical equations and algorithms from the beginning, after extensive evaluation of existing Navy data. This would represent an unacceptable duplication of cost to the government for work that can easily be complete and would introduce substantial and unacceptable delays and risk to the Navy’s enlisted advancement programs. Therefore, no other source has the capability to perform this work without a complete re-development of the foundational psychometric models.

5. Determination of Fair and Reasonable Price. GSA has determined the prices of fixed-price services of the schedule contracts to be fair and reasonable for the purpose of establishing the schedule contract. Per DFARS 208.470(d), GSA’s determination does not relieve the ordering activity contracting officer from the responsibility of making a determination of fair and reasonable pricing for individual orders, blanket purchase agreements (BPA), or orders under BPAs. Therefore, ordering activities are responsible to make a separate determination of fair and reasonable pricing for individual orders, BPAs, and orders under BPAs. The Contracting Officer will determine, using the procedures in FAR 15.404-1, that the prices are fair and reasonable and will document such determination with a level of detail commensurate with the complexity and circumstances of each order. By placing an order against a schedule contract, the ordering activity contracting officer concludes that the order represents a fair and reasonable price and best value to the Government.

6. Description of market research among schedule holders and the results or a statement of the reason market research was not conducted. The requiring activity and contracting activity have conducted market research among schedule holders.

Market research was conducted to identify potential sources for the required psychometric and consulting services. NAC has determined that the core of this requirement is the application of proprietary mathematical models and algorithms developed by PDRI specifically for the Navy Enlisted Advancement System. Research confirms that these unique statistical methodologies are the exclusive intellectual property of PDRI and are not available from any other source. While other firms may offer general psychometric consulting, none possesses the specific, validated tools and deep institutional knowledge of the NEAS data environment required to perform the work without causing unacceptable delays and duplication of costs. Therefore, market research concludes that only PDRI is capable of meeting the government’s requirements.

7. Any other facts supporting the justification. This procurement uses a GSA Federal Supply Schedule and will be solicited and awarded in accordance with GSAR Subpart 538.71.

8. Actions the Agency may take to remove or overcome barriers to competition.

For the reasons set forth in Paragraph 4, NETPDC has no plans at this time to compete future contacts for the types of services covered by this document. However, if another potential source emerges, the contracting activity will assess whether competition for future requirements is feasible.