A02-JA_FY26-001_20251208_REDACTED.pdf

CUI//SP-PROCURE//FEDCON

Control Number: FY26-001

JUNE 2025

FAR Part 6 Justification and Approval for Other than Full and Open Competition

1. Requiring Activity: U.S. Army Garrison (USAG) Italy Department of Public Works

(DPW)

2. Contracting Activity: 414th Contracting Support Brigade (CSB), Regional Contracting Office (RCO), Vicenza, Italy.

3. Description of Action: USAG DPW requests a modification to the contracts listed below to increase the total capacity of the five-year VMC construction MATOC (currently in the third year) in order to complete previously awarded Garrison construction projects as well as to support new construction projects that are needed at once to preserve a structure or its contents from damage.

4. Description of Supplies/Services: The VMC construction MATOC is used to execute Design-Build (DB) and Design-Bid-Build (DBB) construction services for the VMC area. The scope of work includes a variety of maintenance repair and construction efforts, including, but not limited to: grading, water lines, sewer lines, painting, roofing, renovation of interiors of existing buildings, new building construction, electrical substation construction, structural construction, heating, ventilating, and air conditioning (HVAC) systems and components, refrigeration systems, fire suppression systems, fuel pipeline and storage systems, power and services supplies, distribution and utilization systems (including lighting), power generators, public address systems, fire alarm systems, telephone systems, asbestos, lead based paint, and petroleum-contaminated material abatement and disposal, and exterior site and systems work such as utilities infrastructure, roadways, sidewalks, parking lots, landscaping, and irrigation. The VMC Construction MATOC contractor pool provides competition for subsequent DB and DBB firm-fixed price (FFP) task order requirements.

The construction MATOC was solicited utilizing full and open competition resulting in proposal submissions from ten firms. Indefinite Delivery Indefinite Quantity (IDIQ) awards were made on 07 November 2023 using the Highest Technically Rated Offeror (HTRO) source selection approach along the Best Value Continuum. The Construction MATOC has seven responsible contractors with design and construction capabilities (reference the contractor table in paragraph 3 above).

Contract # Contractor Cage SAM.gov UEI Address W912PF24D0001 Battistella Spa A0536 HYSWC1ULWPA9Pasiano Di Pordenone, Italy W912PF24D0002 PORR Government Services Italy Srl AJ336 R8LZLYBG7UK5 Vicenza, Italy W912PF24D0003 Consorzio Continental Scarl AR578 CG65Q3HBTMN5 Napoli, Italy W912PF24D0004 Environmental Chemical Corporation Italy Srl AP350 X6PKF1TKFJN5 Limena, Italy W912PF24D0005 Eiffage Infraestructuras SA 607DB LMHZXD1EYFC7 Dos Hermanas, Spain W912PF24D0006 JV SKE Italy 2012 AL013 FNM2GH3R7AW3Vicenza, Italy W912PF24D0007 Wolff & Muller Government Services Italia Srl AN734 LDJHEUWJ4DP6 Milano, Italy

JUNE 2025

The current MATOC ordering period is 08 November 2023 to 7 November 2028 (five years) with an original ceiling value of $20,000,000. To date, $16,783,025, or 84%, of the ceiling has been expended leaving $3,216,975 for the remaining three years.

An increase to the ceiling of $9 million is requested due to construction needed at once to preserve a structure or its contents from damage and modification contingency associated with those projects.

5. Authority Cited: Title 10 United States Code (U.S.C.) § 3204(a)(2) as implemented in Federal Acquisition Regulation (FAR) § 6.302-2(a)(2) and Defense Federal Acquisition Regulation Supplement Procedures, Guidance, and Information (DFARS PGI) § 206.302-2 Unusual and Compelling Urgency(b)(iii) construction needed at once to preserve a structure or its content from damage.

6. Reason for Authority Cited: This action requires use of the authority at 10 U.S.C.

-2 and DFARS PGI 206.302-2(b)(iii), because the construction work is urgently needed to preserve existing facilities and their contents from damage. The accelerated depletion of MATOC capacity necessitates an out-of-scope modification to ensure timely execution and prevent further deterioration.

a. Background: Market research was conducted for the VMC Construction MATOC in February 2023. The research took into consideration the amount of $17.6 million (procured via the issuance of 40 task orders) in construction requirements procured between Fiscal Year 2018 (FY18) – FY23 on the previous VMC construction MATOC. During the time of the current VMC MATOC recompete and ceiling determination, the following details are pertinent:

1. USACE JOC: DPW utilized the U.S. Army Corps of Engineering (USACE)

Job Order Contract (JOC) for construction projects that did not require a design or had a developed design.

2. O&M Thresholds: In accordance with 10 USC § 2805 Unspecified minor construction, the use of operation and maintenance appropriations were authorized for unspecified minor military construction projects costing not more than $2,000,000.

3. EDI Funding: European Deterrence Initiative (EDI) funding is a flexible U.S. defense tool that adapts to current events. Current geopolitical developments—especially Russian military activity—directly influence which garrisons are selected for infrastructure investment.

4. Modifications: Historically (previous FY18 MATOC), modifications to awarded projects accounted for 10% of the ceiling consumed.

Modifications are typical in construction due to various reasons, but most often differing site conditions (e.g., hazardous material) or time extensions

JUNE 2025

extending field overhead costs. Of the awarded projects on the current MATOC, three projects have experienced an average increase of 10% already, and nine anticipate an increase of 30% within the next four months.

The current MATOC was awarded in November 2024 with the intent to support projected magnitude of USAG Italy DPW construction requirements during the five-year ordering period, FY25 – FY29. Based on the market research performed at the time, the $20,000,000 ceiling was sufficient based on historical projects and future USAG Italy Annual Work Plans (AWP). In less than two years into the five-year ordering period, RCO awarded 30 task orders and 17 task order modifications totaling $16,783,025 resulting in a remaining ceiling of $3,216,975, or 16%.

The unexpected, early influx of orders can be largely attributed to the factors listed in paragraphs (a)(1)-(4) above, explained in more detail below:

1. USACE JOC: The JOC expired in November 2024 with the new contract awarded in May 2025 resulting in a seven-month period without the ordering vehicle. This resulted in roughly $900,000, or seven orders, being placed on the VMC construction MATOC, which was not considered in the initial VMC construction MATOC ceiling determination.

2. O&M Thresholds: The threshold for new construction was increased from $2 million to $4 million in December 2023, enacted by the FY24 National Defense Authorization Act (NDAA). U.S. Army Materiel Command (AMC) provided the guidance via memorandum in March 2024 delegating authority to expend available O&M appropriations up to the $4M statutory or increase EMCT threshold to all Garrison Commanders, Garrison Managers and Depot Managers of installations for which HQ IMCOM has been assigned real property accountability in the Army Headquarters Installation Information System (HQIIS).

3. EDI Funding: Following February 2023 when the market research was conducted, EDI funding allocated to U.S. Army Garrison Italy’s Area of Responsibility (AOR) increased. This rise reflected expanded requirements for logistics, infrastructure, and prepositioned stocks, driven by NATO enhanced deterrence posture in response to Russia’s ongoing war in Ukraine. This resulted in roughly $2,500,000, or three orders, which would not have been considered in the initial ceiling due to the influence of current events.

4. Modifications: As provided above, the average increase in projects due to modifications was 10%; however, based on projects in the current VMC MATOC, the average of already awarded project modifications is anticipated at 30%. The increase can be attributed to the size and

JUNE 2025

Modernization (SRM) program has been impacted by increased statutory thresholds for O&M-funded construction, unanticipated funding sources such as EDI, a lapse in JOC coverage for FY24–FY25, and unforeseen differing site condition modifications.

Failure to increase the MATOC ceiling would result in significant delays to urgent construction requirements, including repair of failing utilities and structures necessary to preserve facilities and protect personnel, property, and mission assets. Issuance of a task order under the MATOC can be accomplished in approximately 60 days from RFP compared to an estimated 120 days for a stand-alone contract. This difference in lead time would seriously injure the Government by exposing critical infrastructure to further deterioration and risk to safety and national security.

Additionally, contractors under the MATOC are already vetted and familiar with the security and administrative requirements of working on a U.S. installation. Their established knowledge of access procedures, safety protocols, and administrative processes further streamlines execution and reduces risk of delay, ensuring construction can commence without the additional lead time required to qualify new contractors.

Accordingly, pursuant to Title 10 U.S.C. §3204(a)(2), FAR 6.302-2(a)(2), and DFARS PGI 206.302-2(b)(iii), an increase in the MATOC ceiling is requested to address these urgent requirements. The requested ceiling increase of $9M is consistent with the one-year limitation under FAR 6.302-2(d), as the recompete MATOC award is anticipated in FY26 for use beginning FY27.

c. Alternatives:

1. Full and Open Stand-Alone Contracts: A full and open competition would require about 120 days to award, compared to 60 days under the MATOC.

This delay would expose the Government to unsafe conditions and mission risk. Further, DPW and RCO must execute multiple projects at once; managing numerous stand-alone acquisitions would multiply delays and administrative burden. In contrast, the MATOC allows rapid, concurrent task order awards to vetted contractors already familiar with installation requirements.

2. Recompete MATOC: This alternate is already underway; however, due to the planned award in the fourth quarter of FY26, delaying the projects in order to utilize the new MATOC would cause further risk of damage.

d. Impact if not approved:

1. Unacceptable Delay: Stand-alone competitive acquisitions would require approximately 120 days to award, compared to 60 days under the MATOC. With multiple projects needing concurrent execution, this delay would leave critical utilities and structures in failing condition for months longer, jeopardizing safety and mission readiness.

JUNE 2025

2. Duplication of Cost: Establishing separate noncompetitive contracts or multiple stand-alone acquisitions would duplicate administrative effort, increase procurement costs, and require onboarding of contractors unfamiliar with installation security and administrative requirements.

3. Serious Harm to the Government: Without immediate action, deteriorating facilities and failing infrastructure could cause damage to Government property, disrupt operations, and endanger personnel. The inability to respond promptly would impair DPW’s ability to protect national security interests and fulfill its responsibilities.

7. Efforts to Obtain Competition: The Contracting Officer will not publish the notices required by FAR 5.201 based on the following FAR exception: 5.202(a)(2). As discussed above, the proposed contract action is being made in part under the circumstances described in FAR 6.302-2.

a. Effective competition: Effective competition will continue to occur among the seven MATOC contractors at the task order level. Task order proposal requests will be issued, and each task order will be awarded to the contractor submitting the lowest-priced proposal. The current MATOC contracts were awarded two years ago following an extensive competitive source selection process, ensuring that all contractors are qualified and capable of performing the required work. This structure allows the Government to maintain competition at the task order level while meeting urgent requirements.

b. Subcontracting competition: Not applicable as this is not a single source acquisition. Also, this action does not include a subcontracting plan, as the work will be performed overseas; however, the Government will continue to encourage prime contractors to obtain competition in their subcontracting to the maximum extent practicable.

8. Actions to Increase Competition: Although this justification relies on FAR 6.302-2 for unusual and compelling urgency, the Government continues to maximize competition. The current MATOC was awarded through full and open competition, and effective competition will occur at the task order level among the seven contractors, with awards based on lowest-priced. A recompete MATOC is planned for FY26 to restore full and open competition for future requirements.

9. Market Research: A market research report was not formally prepared for this specific effort due to the urgent nature of the requirement; however, market research is currently being conducted in support of the forthcoming competitive procurement of the MATOC recompete anticipated in FY26. This effort will ensure full and open competition for future requirements and broaden the pool of qualified sources. Furthermore, as this

JUNE 2025

contract action is not utilizing the authority at FAR 6.302-1, a request for information or source sought notice required under DFARS PGI 206.302-1 is not required.

10. Interested Sources: Not applicable.

11. Other Facts:

a. Procurement history. The current MATOC contracts are displayed in the contractor table in paragraph 3 above. There was a total of ten offerors who submitted proposals and seven were selected for contract awards.

b. Other facts. As permitted under FAR 5.202(a)(2), a synopsis to identify interested sources will not be issued in SAM.gov prior to increasing the IDIQ maximum value. In accordance with FAR 6.305, an award announcement will be posted on SAM.gov within 30 days after award and remain publicly available for at least 30 days. Any communication received from interested parties will be considered and incorporated into the ongoing market research effort described in Section 9.