LSJ_-_IBM_Mainframe_-_20087423_-_for_FBO_Posting.pdf

Limited-Sources Justification (LSJ) IBM Software Licenses and Maintenance Renewal for Enterprise

PR 20087423

- 1 -

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.

Department of Homeland Security, Customs and Border Protection (CBP), Office of Information and Technology (OIT), proposes to enter into a task order pursuant to FAR 8.405-6(a), Limiting Sources.

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

Office of Information and Technology intends to limit the number of sources solicited pursuant to FAR Part 8.405-6(a) for the procurement of annual renewal of IBM proprietary Subscription and Support (S&S), e.g. software license, and the Monthly License Charge (MLC), e.g. software maintenance, at an estimated cost of for a one-year base and one-year option period. A firm fixed price Federal Supply Schedule task order is contemplated using FY16 Operations and Maintenance funds for the base year.

The following awardee is identified for task order award:

International Business Machines (IBM) 6710 Rockledge Drive Bethesda, Md 20817 (800)333-6705

3. Description of Supplies/Services.

This requirement is to provide renewal of IBM proprietary Subscription and Support, and Monthly License Charge, at an estimated cost of for the base year, plus for option year 1, total estimated cost . This software is widely used across the enterprise and essential for continued use of mission critical CBP Mainframe applications. The software supports a large range of functions, from developer tools to production system application execution, monitoring, and system level software.

The Mainframe supports either directly or indirectly, approximately 90% of CBP’s mission critical automated systems. The required software must be an exact match for compatibility purposes. Applications are in production that are mission critical and will be at risk for failure if the software is not kept up to date with fixes and new versions. Also, vendor support is required for any failures of the application related to the software.

http://uscode.house.gov/

PR 20087423

- 2 -

Many of the required products, although undergoing various software version and enhancement upgrades, have been used for more than ten (10) years within CBP and the Department of Homeland Security (DHS). During this time CBP has created many mission critical applications which are dependent on this software. The software licenses will be used by CBP Office of Information and Technology (OIT) support personnel. The software requires ongoing upgrades to allow integration of information and continued enhancements for CBP systems and vendor support for any issues that may arise.

Testing and implementation of a replacement product would require extensive time and funding, neither of which can be implemented at this time; therefore, renewing maintenance on the existing equipment is the only reasonable option available at this time. For these reasons, CBP is unable to implement conversion from IBM mainframe to another IT solution at this time.

4. Authority and supporting rationale.

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)(1)(i)(B), Limiting Sources, only one source is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized. The required S&S and MLC are proprietary to IBM. A sole source award to IBM allows CBP to take advantage of the best price through their software efficiency offering in a single transaction to meet CBP’s needs by providing a total solution. Under this arrangement, S&S and MLC together offer a complete solution to meet CBP mission requirements, and provide cost savings.

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 IBM for Subscription and Support, and Monthly License Charge represents the best value and will result in the lowest overall cost, considering price and administrative costs, to meet the Government’s needs.

Although market research indicates that another vendor could provide the S&S, (which is a much smaller overall portion of the resulting Order, approximately 15% of the overall value), it was determined that it is in the government’s interest to combine the S&S and MLC in a single contract, rather than two individual contracts, in order to receive more favorable, discounted pricing. In addition, there are administrative efficiencies gained by awarding a single contract that results in a total solution, such as reduced administration costs and increased efficiencies in dealing directly with a single awardee, as opposed to coordinating multiple awards with each vendor providing a partial solution. Therefore, a single transaction is the most efficient and effective strategy to meet CBP’s mission needs.

http://uscode.house.gov/

PR 20087423

- 3 -

This order will be placed in accordance with FAR 8.404, “Use of Federal Supply Schedules.”

The General Services Administration (GSA) has already negotiated fair and reasonable pricing. Discounts to the GSA schedule pricing will be requested. Additionally, the contractor’s proposed costs will be compared to the Independent Government Cost Estimate (IGCE). A comparison will also be made with pricing received under previous orders.

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 considered FirstSource II, however, none of the contractors on this strategic sources vehicle have software reseller rights or MLC for the required IBM mainframe support. GSA schedule holders were considered; Four, Inc. is an authorized IBM Teaming Partner to sell the S&S product, but is not certified to sell the MLC. The IBM representative confirmed that only IBM is authorized to sell the mainframe MLC. This offering results in a single transaction for both the S&S and MLC. The applicable GSA schedule is GS-35F- 110DA under GSA Schedule 70.

Market research further indicates other companies’ similar products, or products lacking the particular features, do not meet, or cannot be modified to meet, the agency’s needs. Any disruption of this support would severely impact CBP’s ability to accomplish its mission as many mission critical applications depend on these IBM Commercial Off the Shelf (COTS) software components. IBM is the only compatible solution for use on the legacy mainframe environment until such time as all applications running on the mainframes can be re-written and transferred to other hardware platforms.

7. Any other facts supporting the limited-sources justification. Additional facts may be stated in this section.

It is critical that the required software be an exact match to ensure compatibility with the IBM Mainframe for continuous mission critical operations until such time that new technology is identified and implemented. Applications are in production that will be at risk for failure if the software is not kept up to date with fixes and new versions. Also, vendor support is required to quickly address any failures of applications related to the IBM proprietary software.

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

The ability of the government to have competition for this requirement is restricted because of the proprietary nature of the IBM mainframe that has been in use for over ten (10) years.