HS002124F0071 Limited Source Justification_Redacted.pdf

FEDERAL ACQUISITION REGULATION (FAR) PART 8

LIMITED SOURCE JUSTIFICATION (LSJ)

Procurement Title: Defense Counterintelligence and Security Agency Counterintelligence Analytical System Modernization GSA Contract Number: GS-35F-0086U Contractor: Palantir Technologies, Inc.

Estimated Value:

Limited Source Authority: FAR 8.405-6(a)(1)(i)(B)

1. Identification of the agency and contracting activity.

The United States (US) Department of Defense (DoD) Defense Counterintelligence and Security Agency (DCSA) Contracting and Procurement Office (CPO) proposes to enter a contract on a basis of other than full and open competition for the Office of Counterintelligence (CI) within the CI and Insider Threat Directorate.

a. Requiring Activity/Program Office:

DCSA - Office of Counterintelligence, CI and Insider Threat Directorate 27130 Telegraph Road Quantico, VA 22134

b. Contracting Activity:

DCSA – CPO

27130 Telegraph Road Quantico, VA 22134

2. The nature and/or description of the action being approved.

This requirement provides for the sustainment of the DCSA CI Analytical System (DCIAS), which is the mission-critical system of record for CI that stores and integrates data in support of identifying, assessing, and disrupting threats to cleared industry, cleared personnel, the DoD and DCSA.

Specifically, this requirement procures Palantir Gotham Cloud Licenses, along with the associated support, needed to sustain the current DCIAS environment. DCIAS possesses interdependencies with all other CI requirements and supports each of CI’s mission goals and objective. Additionally, this requirement supports DCSA enterprise goals to enable a productive work environment through automation and developing a secure digital ecosystem to drive transformation and mission performance. The inability to sustain DCIAS would result in work stoppage for CI.

This action is for a Firm-Fixed-Price (FFP) order directly to Palantir Technologies off of its established General Services Administration (GSA) Federal Supply Schedule (FSS). Per FAR 8.401, 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.

3. A description of the supplies or services required to meet the agency’s needs (including estimated value).

The supplies/services required to meet DCSA CI’s requirements include the following:

Description of the Requirement: Provide the Office of Counterintelligence with Palantir Cloud License Sustainment. The products required are as follows:

Product Number Product Name PT-PG-CLOUD Cloud Software License- Palantir

Platform configured as Gotham Palantir Enablement Services

(CES)

Core Engineer Services

Field Service Representative

(CONS)

Continental United States (CONUS) Field Service Representative (FSR)

Support

Total Estimated Cost:

Period of Performance: One (1) six (6) month base period, plus four (4) 6 month option periods.

4. Identification of Authority.

In accordance with 8.405-6(a)(1)(i)(B), only one source can provide the supplies or services required at the level required because the supplies or services are unique or highly specialized. DCSA market research identifies Palantir as the only available software solution for DCIAS capable of providing all required features to CI within an Impact Level (IL) 6 environment.

Per Defense Federal Acquisition Regulation Supplement (DFARS) 208.7402(1), departments and agencies shall fulfill requirements for commercial software and related services through DoD mandatory source, DoD Enterprise Software Initiative (ESI). Palantir Technologies is currently an ESI BPA holder; however, its ESI BPA is set to expire in July 2024, which will occur before the anticipated award date of this requirement. The follow-on ESI BPA is anticipated to be executed in late 1st Quarter Fiscal Year (FY) 2025, making ESI an unavailable option for this award.

5. A demonstration of the proposed contractor’s unique qualifications to provide the required supply or service.

In accordance with FAR 8.405-6(a)(1)(i)(B), Palantir Technologies is the only source capable of providing the services required at the level of quality required. Palantir Technologies, Inc., is the proprietary owner of Palantir Gotham, which provides DCSA with custom and flexible tools to import and model data, intuitive constructs to search against this data, and powerful applications to analyze the data in numerous ways. Based on extensive market research, other vendors are unable to meet DCSA’s functional requirements, including:

Integrate disparate data sources, providing common views of unified data;

Search and discover across all datasets;

Perform enterprise-wide knowledge management;

Collaborate across users, groups, and agencies;

Conduct relational, temporal, geospatial, statistical, and network analysis in one unified

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Share investigations and analytic discoveries in a single secure collaborative environment to achieve situational awareness and collective understanding;

Maintain an interactive history of every object in the system – objects of interest can be ‘watched’ for changes and every edit is recorded in an immutable audit log; and, Perform robust auditing, auditing traits, and identify when and who has viewed or changed any item of data.

There is no authorized reseller for the full Palantir Platform. While Palantir has an established ecosystem of channel partners and authorized resellers for the additional services required by DCSA, the significantly discounted pricing provided by Palantir in their market research estimate is contingent upon DCSA contracting direct with Palantir. Furthermore, if DCSA were to procure the additional engineering and field service support services from one of Palantir’s partners, it would introduce additional cost and administrative burdens for procuring and administering multiple separate contracts. Based on this, Palantir is the best suited vendor to provide the full scope of products and services required by DCSA.

Market research efforts have failed to identify any other solution that offers all required functionalities in one platform, and more specifically, within a secure platform. Developing and introducing a similar secure solution would be both time consuming and costly. In addition, obtaining all the essential features would require multiple contracts with multiple different vendors, introducing additional complexities and increasing the room for error in ensuring cross-functionalities between multiple different Contractors’ systems and oversight. Counterintelligence and contract personnel would have to be trained to use new systems, integrate a multitude of streams of data, and build applications to replicate what is already in existence via Gotham. The additional cost burdens would include both the Government administration required to procure and administer new contracts, as well as the costs associated with separately purchasing all of the functionalities.

Over the past four years, DCSA has conducted market research to identify other SaaS solutions to meet DCSA CI’s DCIAS requirement. DCSA has evaluated over seven (7) potential solutions for DCIAS; however, all evaluated solutions are unable to provide the necessary features that Palantir Gotham offers, and unable to meet CI’s functional requirements. In addition, none of the evaluated solutions can provide all required features on a secure platform for DCIAS in a cloud environment with IL 6 authorization. In order for DCSA to acquire the required features and functionalities on a secure cloud platform, it would likely require multiple contracts with multiple different vendors, which would result in significant investment by DCSA/CI into on-premises infrastructure or secure-network cloud infrastructure. Palantir Gotham is determined to be the only solution available in the marketplace to meet all the unique requirements needed to support DCSA CI’s intelligence and reporting activities.

There are no other vendors that can provide application with all the capabilities CI requires. For the Government to build and sustain a new application that meets all required capabilities and parameters, it would take approximately 24 months, which would create a critical capability gap for CI. Additionally, CI would require an extensive realm of support personnel in order to build and sustain the new application, costing an estimated additional $10M. Furthermore, personnel would have to be trained to use a new system, integrate a multitude of streams of data, and build applications to replicate what is already in existence. The estimated level of effort and cost associated with a new application is detailed in the table below.

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6. A determination by the Contracting Officer that the order represents the best value (FAR 8.404(d)).

The Contracting Officer has determined that issuing an order against the FSS represents the best value to the Government resulting in the overall lowest cost alternative, considering price and special features necessary to meet the Government’s requirements. This determination is made on the basis that the required product is available via GSA FSS, which will decrease the administrative time/burden, that the Contractor’s proposed pricing is fair and reasonable, and that the Government will seek further discounts.

Per FAR subpart 8.4, GSA has already determined the GSA Schedule prices to be fair and reasonable;

however, the Contracting Officer will conduct price analysis using one or more methods, including but not limited to, comparison of pricing to historical prices paid and comparison with competitive published price lists. The Contracting Officer will make a separate fair and reasonable determination as well as requesting additional discounts in accordance with FAR 8.405-2 and DFARS 208.404, Use of Federal Supply Schedules, and DoD Class Deviation 2014-O0011- Determination of Fair and Reasonable Prices When Using Federal Supply Schedule Contracts, dated March 13, 2014.

Based on the justification to continue with its current need for the Palantir Gotham Cloud Licenses, the market research conducted and significant discounts anticipated, as well as implementation of the streamlined procedures under FAR part 8, DCSA has determined that issuing a task order to Palantir Technologies, Inc. against GSA contract GS-35F-0086U represents the best value to the Government at the lowest potential price.

The GSA FSS with Palantir Technologies indicated the cost of the required licenses and services to be approximately ; however, the actual anticipated dollar amount for this action is approximately This amount was obtained via a Rough Order of Magnitude (ROM) provided to DCSA by Palantir Technologies during market research and includes significantly discounted pricing off of Palantir’s DoD ESI BPA. DCSA inquired with Palantir to confirm that they will honor the ROM pricing estimate that was based upon DCSA ordering off of DoD ESI, even if a

Cost per FTE Number of FTEs Annual Cost for Labor Category

Project Managers, GG-15 $200,000 2 $400,000

Software Developers, GG-14 $175,000 6 $1,050,000

Requirement Analysts, GG13 $150,000 8 $1,200,000

Software Developers, GG-13 $150,000 18 $2,700,000

QA Engineers, GG-13 $150,000 8 $1,200,000 Data Engineers, GG-

13 $150,000 8 $1,200,000

45 $7,390,000

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Request for Quote is solicited via GSA instead. Palantir confirmed that they will honor the current ESI terms after the BPA expires, and will quote the same discounted pricing as provided within the market research estimate, regardless of the ordering vehicle. With Palantir honoring the significantly discounted pricing, there is no benefit to executing a shorter contract in order to procure off of the new DoD ESI BPA once available. Given the significant discounts offered, there is no guarantee that the pricing will be the same or lower compared to Palantir’s current price estimate if DCSA were to execute a new order next year off of Palantir’s new DoD ESI BPA once available.

7. A description of the market research conducted.

DCSA continually seeks vendors that can offer alternative SaaS solutions to meet DCSA CI’s unique requirements. In accordance with (IAW), FAR part 10, DCSA CI has conducted extensive market research for the purpose of seeking as many potential sources as possible. Systems reviewed include All options are currently unable to provide a comparable secure platform to Palantir without significant investment by DCSA into either on premises infrastructure or SIPR Cloud Infrastructure. DCSA requires a software that can meet the analytic functionality necessary, while also operating on IL6. Palantir is currently the only company that offers both of these critical requirements.

Solution Assessed Capability to meet DCSA CI Requirements

A relationship-oriented software that enables graph analytics at scale through a set of analytic techniques based on how business entities such as people, places, and things are related to each other. CI deemed inappropriate for DCIAS due to its foreign-ownership ties.

Combines case management, intelligence collection, analytics and more in a simple cloud-based architecture by DCSA, an on premises deployment, or DCSA to sponsor and ATO on IL6.

is a maturing software and is not compliant on IL6.

DCSA is not the appropriate agency to sponsor into classified spaces since IL6 requires a Service-level effort to sponsor an ATO.

Workflow management tool, but not built to do detailed analysis required by DCSA CI.

Workflow management and ticketing tool, but not built to do detailed analysis required by DCSA CI.

Historically a geospatial intelligence tool, but new capabilities are being added to that have the potential to meet DCIAS requirements. To deploy this tool across CI would require a complete overhaul of CI capabilities and resourcing to include cloud architecture, on-premises deployment, and workforce training and implementation.

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Palantir Gotham https://www.palantir.com/platforms/gotham/

Palantir Gotham is a commercially-available, AI-ready operating system that improves and accelerates decisions for operators across roles and all domains. Gotham integrates data from any number of systems and presents it in multiple visual formats, enabling analysts to produce actionable intelligence based on the full ecosystem of available data. Palantir Gotham is FEDRAMP-approved and have a provisional ATO for IL6 from DISA.

8. Any other facts supporting this justification.

CI regularly conducts market research for SaaS products utilizing the mandatory sources such as GSA Advantage, NASA Solutions for Enterprise-Wide Procurement (SEWP), DoD ESI and open market via internet, phone, and email, as well as contacting DCSA partners and collaborating with other United States Government agencies to identify any additional products that may have the necessary capabilities to meet DCSA’s minimum requirements. No other products have been identified that meet DCSA CI’s minimum requirements at this time.

9. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required, if subsequent acquisitions are anticipated.

The Counterintelligence Directorate will continue to conduct market research to ascertain if changes occur in the marketplace that would enable future actions to be competed. Future efforts, if needed, will be procured through mandatory sources such as DoD ESI, as necessary.

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Certification:

Program Official:

I certify that the facts and representations under my cognizance, which are included in this justification, and which form the basis for this justification, are complete and accurate.

Program Analyst Office of Counterintelligence

Contracting Officer:

I certify that this justification I accurate and complete to the best of my knowledge and belief.

Contracting Officer Contracting and Procurement Office (CPO) Defense Counterintelligence and Security Agency

Reviews and Approvals:

Competition Advocate (actions exceeding $750K but less than $15M):

This review serves as concurrence and my written determination that the aforementioned circumstances apply in accordance with FAR 8.405-6(a)(1)(i)(B).

Alternate Competition Advocate Contracting and Procurement Office (CPO) Defense Counterintelligence and Security Agency

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Head of Contracting Activity (actions exceeding $15M but less than $75M):

This review serves as my written determination that the aforementioned circumstances apply in accordance with FAR 8.405-6(a)(1)(i)(B).

Head of Contracting Activity (HCA) Contracting and Procurement Office (CPO) Defense Counterintelligence and Security Agency

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