JA18-097_red_Redacted.pdf

JUSTIFICATION FOR OTHER THAN FULL AND

OPEN COMPETITION (OTFAOC)

Federal Acquisition Regulation (FAR) Part 6 Justification & Approval (J&A), Supporting Procurements under FAR Part 12, FAR Subpart 13.5, and FAR Part 15

Purchase Request Number: To be determined (TBD) Contract Number: TBD Tracking Number: 841812295 Procurement Title: Statistical Analysis System (SAS) Software Licensing and Software Support with Sub-Capacity Savings Estimated Value:

Statutory Authority: 10 U.S.C. §2304(c)(1)

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION (OTFAOC)

Justification for OTFAOC Number: JA18-097

Upon the basis of the following justification, I, as the Procuring Activity Competition Advocate (PACA), hereby approve the use of other than full and open competition of the proposed contractual action pursuant to the statutory authority of 10 U.S.C. §2304(c)(1) and the regulatory authority of FAR Part 6.302-1, only one responsible source and no other supplies or services will satisfy agency requirements.

1. REQUIRING AGENCY AND CONTRACTING OFFICE:

a. Requiring Agency:

Defense Information Systems Agency (DISA) Operations Center Logistics/OCL24 1 Overcash Avenue, Building 1 Chambersburg, Pennsylvania 17201-4122

b. Contracting Office:

DISA/Defense Information Technology Contracting Organization (DITCO)/PL8413 200 East Drive, Building 3600 Scott Air Force Base, Illinois 62225-5406

2. NATURE/DESCRIPTION OF ACTION(S):

a. The nature of this action is to renew commercial off-the-shelf SAS software licensing and software support with sub-capacity savings in support of DISA. The SAS software supports applications transmitted to and are processed by DISA managed systems and facilities. This procurement will be awarded as a firm fixed price (FFP) purchase order to the sole source provider and original equipment manufacturer (OEM), SAS Institute Incorporated, using open market procedures. This requirement will perpetuate existing coverage of SAS software licensing and software support with sub-capacity savings under contract number HC1028-14-C- 0011, which will expire on September 30, 2018.

SAS Software Licensing and Software Support Renewal 841812295-JA18-097

Page 3 of 7 Pages chargeback, capacity planning and performance analysis. The MICS and MXG tools require, at minimum, the base SAS product. In addition, the SAS/GRAPH product is used by the performance management group to create charts and graphs that are part of a DISA-wide web-based reporting system. SAS is a powerful language that enables programmers to quickly develop an application/program, making it an extremely useful tool within DISA. Sub-capacity pricing allows the Government to pay based on the average millions of instructions per second (MIPS) used in each licensed logical partition (LPAR) each month. The standard SAS licensing model requires payment for the entire capacity of the processor, rather than the small portion of the processor in which the software resides. Sub-capacity pricing allows the Government to pay based upon the average MIPS used in each LPAR used each month. The annual cost can fluctuate depending upon how many MIPS are used for the license. DISA’s cost container requires such flexibility in software licensing and support to ensure DISA is paying only for the software being utilized.

4. IDENTIFICATION OF STATUTORY AUTHORITY:

This acquisition is conducted under the statutory authority of 10 U.S.C. §2304(c)(1), only one responsible source and no other supplies or services will satisfy agency requirements. The regulatory authority that applies to the purchase of brand-name software updates and releases is FAR 6.302-1/DFARS 206.302-1, only one responsible source and no other supplies or services will satisfy agency requirements.

5. DEMONSTRATION OF CONTRACTOR’S UNIQUE QUALIFICATIONS:

a. Description of Events: The software OEM owns all proprietary rights to the source code and has not released the product source code to any authorized third party vendors to sell, lease or maintain their proprietary software product. Only the OEM can provide the continued software support of the proprietary commercial off-the-shelf (COTS) software.

b. Justification:

(1) Minimum Government Requirements: Renew SAS software licensing and software support as detailed in section 3.a and 3.b.

(2) Proposed sole source contractor: SAS Institute Incorporated

(3) Discussion regarding cause of the sole source situation: Previously purchased SAS software requires ongoing support to remain functional. SAS Institute Incorporated is the sole manufacturer for the SAS products. The SAS software licensing and software support renewal with sub-capacity savings is proprietary and only available from SAS Institute Incorporated, and no other support renewal will satisfy the agency requirements.

SAS Institute Incorporated owns all proprietary rights to the software code and does not offer renewals with sub-capacity savings to resellers.

(4) Demonstration of unique source: Similar products available on the market do not offer the full functionality of the SAS products. Significant costs and resources would be

Page 4 of 7 Pages required for the transfer to a different suite of software products. Market research showed the products are not compatible with MICS and MXG.

(5) Procurement Discussion: SAS software licenses are fully implemented and integrated into DISA’s architecture and require support to remain functional. This acquisition will be a sole source contract to SAS Institute, Inc.

(6) Impact: The present need is for continued support of the SAS existing licenses to obtain necessary patches, updates, and fixes to prevent security vulnerabilities from occurring. MICS and MXG could not be used without SAS software support. Software support for these products is required in order to obtain product support and the latest versions of the software. Software support is also required in order to meet DISA’s Security Technical Implementation Guide requirements to prevent security vulnerabilities in DISA’s communication architecture. Additionally, if the required software support is not procured, DISA would be in violation of security mandates which require software in the DISA environment to have software support.

6. FEDBIZOPPS ANNOUNCEMENT/POTENTIAL SOURCES:

A sources sought notice was published by DITCO-Scott to Federal Business Opportunities on April 13, 2018 through May 3, 2018 with no responses. A combined synopsis/solicitation of the proposed contract action will be synopsized on the Federal Business Opportunities website, as required by FAR 5.203(a), with the intention to award a sole source contract to SAS Institute, Inc. A copy of the redacted Justification for OTFAOC will be posted with the synopsis.

7. DETERMINATION OF FAIR AND REASONABLE COST:

A determination will be made by the contracting officer that the order represents the best value to the Government, as defined in FAR 2.101, and results in the lowest overall cost alternative (considering price, special features, and administrative costs) that meets the Government’s needs.

The contracting officer will determine that the resulting contract prices will be fair and reasonable based on comparison with the prices outlined below. The contracting officer will also determine the pricing information valid for comparative purposes. Certified cost and price data is not required for this commercial item acquisition, in accordance with FAR 15.403-1(b)(3).

The contracting officer will determine whether the price is fair and reasonable based on:

a. Comparison of the proposed prices to historical and existing prices paid, whether by the Government or other than the Government for the same or similar items.

b. Comparison with competitive published price list, published market prices of the same commodities.

c. Comparison of proposed prices with the Independent Government Cost Estimate.

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8. MARKET RESEARCH:

a. Market research was conducted from December 2017 through May 2018 via internet searches, phone calls and was based on the prior years’ acquisitions. The software support will continue to support the perpetual SAS software licenses that are already installed on the DISA Mainframe architecture. Market research showed that these licenses, maintained since the initial purchase, are commercially available to properly support the operating environment. Based on current market research, it has been determined that only the aforementioned brand-name software products can meet the Government’s needs. No other vendor or distributor/reseller can legally obtain access to the software, and no other vendor can make duplicate copies, since it is protected by copyright and patent laws.

b. Market research determined a negotiated contract directly with SAS would afford DISA the flexible terms and the type of sub-capacity pricing meeting DISA’s needs. Sub-capacity pricing allows the Government to pay based upon the average MIPS used in each LPAR used each month. The annual cost can fluctuate depending upon how many MIPS are used for the license. Sub-capacity pricing and the flexible terms of the current contract are not available on the General Services Administration schedule however the single licenses and software support is available. DISA’s cost container requires such flexibility in software licensing and support to ensure DISA is paying only for the software being utilized, thus an open market, sole source procurement is in the best interest of the Government. The SAS software support is not available through a Department of Defense Enterprise Software Initiative Blanket Purchase Agreement or the National Aeronautics and Space Administration Solutions for Enterprise-Wide Procurement V Government-wide acquisition contracts. No resellers were found to resell the SAS software support using sub-capacity pricing.

9. ANY OTHER SUPPORTING FACTS:

None

10. LISTING OF INTERESTED SOURCES:

SAS Institute, Inc.

11. ACTIONS THE AGENCY MAY TAKE TO REMOVE OR OVERCOME BARRIERS

THAT LED TO THE EXCEPTION TO FULL AND OPEN COMPETITION:

a. Procurement History:

Contract Number: DCA200-99-D-5003 Contractor: SAS Institute, Inc.

Contract Period: October 1, 2002 – September 30, 2003 Total Estimated Value:

Contract Type: Sole source, FFP Objective: Provide support renewal for SAS licenses/software.

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Contract Number: CC200414225 Contractor: SAS Institute, Inc.

Contract Period: October 1, 2003 – December 31, 2003 Total Estimated Value:

Contract Type: Sole source, FFP Objective: Provide support renewal for SAS licenses/software.

Contract Number: HC1013-04-D-5000 Contractor: SAS Institute, Inc.

Contract Period: January 1, 2004 – December 31, 2008 Total Estimated Value:

Contract Type: Sole source, FFP Objective: Provide support renewal for SAS licenses/software.

Contract Number: HC1028-09-C-2002 Contractor: SAS Institute, Inc.

Contract Period: January 1, 2009 – June 30, 2014 Total Estimated Value:

Contract Type: Sole source, FFP Objective: Provide support renewal for SAS licenses/software.

Contract Number: HC1028-14-C-0011 Contractor: SAS Institute, Inc.

Contract Period: October 1, 2014 – September 30, 2018 Total Estimated Value:

Contract Type: Sole source, FFP Objective: Provide support renewal for SAS licenses/software.

b. If the identified OEM elects to surrender their legal ownership, copyright, and/or intellectual property software rights and move toward a complete open-source solution, then the Government will seek a competitive environment. Regardless, the Government will continue to search the marketplace to determine if alternative solutions exist. If the Government should determine these brand-name products are no longer required or other software meets the Government’s needs, the Government will seek a competitive approach for the required functionality. If similar requirements arise, every effort will be made to compete to the maximum extent practicable.

12. REFERENCE TO THE APPROVED ACQUISITION PLAN (AP):

In accordance with DISA Acquisition Regulation Supplement 7.103(S-91)(1)(vii), this requirement does not meet the dollar threshold requiring a written AP.

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