DOAD-II LSJ OCFO FO Technical Accounting Logical Follow-on v1.1.pdf

OPOAM 3008.405-6

Limited-Sources Justification (LSJ)

For orders or BPAs exceeding the Simplified Acquisition Threshold

LSJ No. FY25-069 - 1 -

LSJ No.: FY25-093

This acquisition is conducted under the authority of the Multiple-Award Schedule Program, 41 U.S.C. 152(3), Competitive Procedures, and 40 U.S.C. 501, Services for Executive Agencies.

1. Agency and Contracting Activity.

The Department of Homeland Security (DHS), Office of Procurement Operations (OPO), Departmental Operations Acquisition Division (DOAD) II proposes to award an order pursuant to FAR 8.405-6(a), Limiting Sources.

2. Nature and/or description of the action being approved.

DHS/OPO intends to limit the number of sources solicited pursuant to FAR 8.405- 6(a)(1)(i)(C) for the procurement of Financial Management Services to Proposed Contractor:

Kearney Company PC, 1701 Duke Street, Suite 500, Alexandria, VA 22314.

3. Description of Supplies/Services.

The contractor shall provide a continuation of support including technical accounting, auditing, Financial Operations (FO) program management, and budget expertise to support technical finance and accounting operations for Office of the Chief Financial Officer (OCFO), Financial Operations Division. OCFO FO provides financial support and oversight to the offices and employees within the Departmental Management and Operations (DMO), which includes support across all 25 program offices within the DMO, to include Offices of the Secretary and Executive Management (OSEM) and the Management Directorate (MGMT), including Federal Protective Services (FPS) and Office of Biometric Identity Management (OBIM). There are two primary aspects of this support:

a. Task 1: Enhancing operations through integration of federal accounting, financial reporting and budget legislation and guidance, industry best practices, DHS financial reporting requirements, and DHS lessons learned. This includes development and execution of automation of manual or repetitive tasks, data analytics, data cleanup, technological integration, audit remediation, audit readiness, risk management, and compliance.

b. Task 2: Leading the end-to-end DMO Component implementation of a modernized, integrated financial system, eliminating legacy systems, and increasing efficiencies in business execution. This work is ongoing with an onboarded system integrator and directly impacts over 600 budget, accounting, and financial management personnel across all 25 program offices including Office of the Secretary, FPS, and OBIM.

The estimated total value for the performance period is $2,260,829.52. This performance period includes a two-month period starting April 25, 2025.

LSJ No. FY25-069 - 2 -

Period Duration (Months)

Unit Price Total

04/25/2025 – 06/24/2025 Two Month N/A $2,260,829.52

Total $2,260,829.52

4. Authority and supporting rationale.

FAR 8.405-6(a)(1)(i)(C). In the interest of economy and efficiency, the new work is a logical follow-on to an original Federal Supply Schedule order provided that the original order was placed in accordance with the applicable Federal Supply Schedule ordering procedures. The original order or BPA must not have been previously issued under sole-source or limited- sources procedures.

This acquisition is being conducted under the authority of the Multiple-Award Schedule Program, 41 U.S.C. 152(3), Competitive Procedures, and 40 U.S.C. 501, Services for Executive Agencies, in accordance with FAR 8.405-6(a), Limiting Sources. An award will be made in the interest of economy and efficiency as a logical follow-on to Task Order No.

70RDAD21FC0000112 pursuant to FAR 8.405-6(a)(1)(i)(C). The original award was competitively solicited and awarded using the ordering procedures at FAR 8.405 under Blanket Purchase Agreement (BPA) No. 70RDAD19A00000009 established under GSA Multiple Award Schedule (MAS) Contract No. GS-00F-031DA and expires on April 24, 2025. It is necessary to limit competition for new work described herein as services are needed after expiration of the incumbent contract and pending award of the competitive follow-on task order.

Rationale:

The scope of this proposed short-term order will remain unchanged from services and deliverables outlined in the original Statement of Work (SOW). Task Order No.

70RDAD21FC0000112 expires in the middle of several key audit and financial systems modernization activities to include the Discovery sprints for the Cube financial systems modernization efforts. The original task order requires Kearney Company PC to perform two tasks: Audit Readiness and Data Cleanup (Task 1) and Financial Operations for Financial Systems Modernization (Task 2). This logical follow-on task order requires continued performance of the same two tasks related to audit and data cleanup as well as financial systems modernization for DMO. For example, under the current task order, Kearney is leading the end-to-end DMO Component implementation of a modernized, integrated financial system. This work is ongoing with an onboarded system integrator and directly impacts over 600 budget, accounting, and financial management personnel across all 25 program offices including Office of the Secretary, FPS, and OBIM. The follow-on task order requires Kearney to continue to perform the exact same tasks with respect to the implementation of a modernized, integrated financial system. The award of a follow-on order would allow for the current vendor to complete the work that commenced under the current task order.

LSJ No. FY25-069 - 3 -

The support currently provided by the incumbent is critical to the continued success of the DHS CFO’s execution of the DHS mission. Bringing in a new contractor would create substantial delays, require considerable lead time to become productive due to the learning curve, and would significantly impact the program’s ability to support critical FSM discovery activities, deliverables, and audit readiness functions. In addition, the incumbent currently holds the requisite security clearances, suitability, and personnel on-site necessary for continued support while the new task order is being initiated. The incumbent’s familiarity and experience with the DMO’s Financial Systems Modernization (FSM) program, stakeholders, and customers; the financial systems; audit requirements and processes;

remediation activities; and its nuances and complexities will alleviate the substantial risk that would be present if a new contractor was brought on board without sufficient transition time.

Any awardee other than the incumbent would be required to obtain the cognizant security clearances, suitability, cyber hygiene, and review by the Chief Information Officer (CIO) which, based on the median time it has taken contractors to obtain the necessary clearances and suitability for efforts under DHS OCFO, would veritably result in a minimum delay of 100 days from the time of award to full performance by the contractor. Given the limited timeframe of this logical follow-on order, DHS has determined that the estimated duplication of time and costs thus could not be substantially recovered through competition and will result in unacceptable delays in fulfilling the agency’s requirements. Due to the in-flight audits’ readiness and assessments and ongoing challenges that have been presented by the FSM program, it is critical that DHS retain the experience and knowledge base of the incumbent until a recompete is complete. Allowing a short-term interim task order will allow additional time to execute a recompete contract action. This support is critical to the timely completion of the audit and for the timely delivery of FSM deliverables related to the on-going modernization effort. If audits are not completed on time, the audit opinion may be modified or delayed. The audit opinion is critical for the Administration and Congress as it lets them know whether or not the information in the financial statements is accurate and transparent. The audit opinion informs the users of financial statements about the integrity and competency of Executive leadership and the Department and can have a direct impact on future funding requests. Further, the FSM program is currently in a critical period where requirements, processes and information is being consolidated to develop the new integrated ERP solution across multiple concurrent development sprints. Without the support of this contractor, FO will be unable to ensure the needs of the Headquarters Component, to include FPS’s unique needs, are accounted for. This will risk Headquarters’ ability to fulfill its fiscal responsibility to the American taxpayer, achieve compliance with statutory requirements and effectively modernize its operations to reduce operational and financial risks in the short, and long run.

5. Determination by the ordering activity contracting officer that the anticipated order represents the best value consistent with FAR 8.404(d).

The contracting officer has determined that issuing the proposed task order to Kearney Company PC for these services represents the best value and will result in the lowest overall cost, considering price and administrative costs, to meet the Government’s needs. The

LSJ No. FY25-069 - 4 -procurement will be conducted utilizing procedures found in FAR 8.405-3 Blanket Purchase Agreements (BPAs), to issue a single task order against the Financial Management & Operations (FMO) Support Services BPA for the DHS OCFO Financial Operations division. DHS/OPO has already determined the BPA rates are fair and reasonable. Discounts from the BPA rates will be requested. Additionally, prior to issuance of the task order, the ordering activity will consider the level of effort and the mix of labor proposed to perform the specific task being ordered in order to determine that the total price is reasonable. The contractor’s labor mix and level of effort will also be compared to the Independent Government Cost Estimate (IGCE).

6. A description of the market research conducted among schedule holders and the results, or a statement of the reason market research was not conducted.

Market research was extensively conducted in 2023 and 2024 as part of the DHS FMO BPA award competition and the subsequent task order competition.

As part of that market research for the DHS FMO BPA process, three (3) primary methods were employed:

1) Request for Information (RFI) Issued: In January 2023, DHS sent RFI No.

70RDA224RFI000001 to ALL GSA Multiple Award Schedule (MAS) vendors under Special Item Numbers (SIN)s SIN 541211 – Auditing Services, SIN 541611 – Management & Financial Consulting, Acquisition and Grants Management Support and Business Program and Project Management Services, and SIN 541219 – Budget and Financial Management Services. A total of seventeen (17) vendors submitted a response that was reviewed, evaluated, and incorporated, as applicable, into the BPA structure, approach, and documentation. Full RFI assessment results are included as Attachment A of the BPA Market Research Report.

2) Acquisition History Review: The reviewer examined the prior task orders awarded under the prior FMO BPAs, to include the current task order for this requirement, Task Order No. 70RDAD21FC0000112.

3) Review of the GSA Federal Supply Schedule/Multiple Award Schedule: The reviewer examined the GSA Federal Supply Schedule/Multiple Award Schedule and GSA eLibrary to identify business establishments by the type of economic activity (i.e., North American Industry Classification System (NAICS)) and respective alignment to GSA’s schedule (i.e., Special Item Number (SIN)) and inventory and examine available vendors able to support the work being solicited.

For the subsequent task order competition, the Program Office reviewed the market research for the DHS FMO BPA. Additionally, two Professional Services Strategic Sourcing Vehicles were reviewed: One Acquisition Solution for Integrated Services+ (OASIS+) and the Program Management, Administrative, Operations (Clerical), and Technical Services II

(PACTS II).

LSJ No. FY25-069 - 5 -

• PACTS II Functional Category 1 provides program management and technical services, but period of performance is ending February 2025 and PACTS III is not available at this time.

• NAICS code 541219 is available in the OASIS + Pool 2. Review of the OASIS dashboard, 34 Task orders have been awarded to vendors under NAICS Code 541219 from Oct 2024 - Feb 2025. Awards were made to Veteran Owned Small Business, Small Business and Large Business.

However, it was determined that only one of the vendors has the requisite knowledge, by being the current contractor, which will prevent any gaps in critical functions until a follow-on task order can be competitively awarded.

7. Any other facts supporting the limited-sources justification.

The target award date for the larger follow-on effort is in June 2025. This logical follow-on order will provide support from the expiration of Task Order No. 70RDAD21FC0000112 through the award date of the follow-on in June 2025.

8. A statement of actions, if any, the agency may take to remove or overcome any barriers that led to restricted consideration before any subsequent acquisition for the supplies or services is made.

This short-term, non-competitive logical follow-on award is necessary to prevent gaps in these critical services and allows OCFO additional time to plan and recompete a larger scope and size follow-on effort that helps meet future OCFO needs. This logical follow-on order will only include a period of performance sufficient to complete several key audits and financial systems modernization activities and provide a continuation of services until the competitive follow-on task order can be awarded. The solicitation for the follow-on effort has completed the necessary reviews, however, there have been unanticipated delays in obtaining necessary approvals prior to solicitation release. These unanticipated delays have impacted the Schedule and created a need for these logical follow-on services pending the competitive solicitation and award against the FMO BPA. This short-term, logical follow-on order will include FAR Clause 52.237-3, Continuity of Services, to facilitate a transition, if necessary, from the incumbent contractor to the awardee of the competitively awarded follow-on task order.

9. DHS intends to post this requirement on System for Award Management (SAM.gov) pursuant to FAR 8.405-6(a)(2)(i).

LSJ No. FY25-069 - 6 -

10. Technical/Requirements Personnel Certification.

Pursuant to FAR 8.405-6(c)(2)(x), I certify that this requirement meets the Government’s minimum need and that the supporting data, which form a basis for the Limited-Sources Justification, are accurate and complete.

LAUREN I PEARCE Digitally signed by LAUREN I PEARCE Date: 2025.04.03 10:44:23 -04'00'

Lauren Pearce Date Technical Representative/COR

DHS/OCFO

11. Contracting Officer Certification.

Pursuant to FAR 8.405-6(c)(2)(ix), I certify that the Limited-Sources Justification is accurate and complete to the best of my knowledge and belief.

LESLIE A KENSER Digitally signed by LESLIE A KENSER Date: 2025.04.03 11:03:03 -04'00'

Leslie Kenser Date Contracting Officer

DHS/OPO/DOAD II

12. Approval.

Antoinette Clay

Digitally signed by

ANTOINETTE CLAY

Date: 2025.04.22 15:05:31 -04'00'

Antoinette Clay Date Procuring Activity Advocate for Competition Office of Procurement Operations