J A_GearboxesO RContractFBO.docx

HSCG38-11-R-J00004

Justification for Other than Full and Open Competition Under 10 U.S.C. 2304 (c)(1) Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements Overhaul of MH-60J/T Gearboxes

HSCG38-11-R-J00004

Pursuant to the requirements of the Competition in Contracting Act (CICA) as implemented by FAR 6.3 and in accordance with the requirements of FAR 6.303-1, the justification for the use of the statutory authority under FAR 6.3 is justified by the following facts and rationale required under FAR 6.303-2 as follows:

(1) Agency and Contracting Activity. The Department of Homeland Security, United States Coast Guard (USCG), Aviation Logistics Center (ALC), Elizabeth City, NC, proposes to enter into a contract on a basis other than full and open competition.

(2) Nature and/or description of the action being approved. The United States Coast Guard has a requirement for a sole-source procurement for the overhaul of MH-60J/T gearboxes. This Justification for Other Than Full and Open Competition seeks approval to contract with the original equipment manufacturer (OEM), Sikorsky Aircraft Corporation (cage 78286), 6900 Main Street, Stratford, CT 06614-1385. Request approval to proceed with this sole source acquisition for a requirements type contract for the overhaul of Main, Intermediate, Input, Accessory, and Tail Rotor gearboxes used on the USCG’s Sikorsky MH-60 J/T fleet of aircraft. The contract will contain a base year with four one year option years. The delivery orders will be issued on a firm fixed-price basis.

(3) Description of the Supplies/Services. This is an overhaul requirement for MH-60J/T gearboxes as listed below. Annual estimated quantities based on previous usage are also shown.

The scope of work is for the overhaul of the Coast Guard’s fleet of MH-60J/T Main, Tail Rotor, Intermediate, Accessory and Input Gearboxes. The contractor shall provide all necessary parts, material, labor, tooling, test equipment and facilities to evaluate and overhaul the gearboxes. This entails complete disassembly to include 100% visual inspection of all components and 100% replacement of housings with Rockhard coated zero time units. The carrier assembly shall be replaced with a zero time Improved Durability Gearbox (IDGB) Improved Planetary Carrier. Time/life components with less than 3500 hours remaining to retirement shall be replaced with a zero time component.

(4) Identification of the justification and the rationale. The statutory authority permitting other than full and open competition is 10 USC 2304(c)(1) implemented by the Federal Acquisition Regulation (FAR) Subpart 6.302-1(a)(2)(ii) entitled “Only one responsible source and no other supplies or services will satisfy agency requirements”.

(5) Demonstration that the nature of the acquisition requires use of the authority cited. The gearboxes to be overhauled are manufactured by Sikorsky Aircraft Corporation, the OEM. Sikorsky is the only known and approved manufacturer for the gearboxes. An email dated January 6, 2011 from the USCG/Navy NAVICP liaison, states that Sikorsky is the only source the Navy currently uses for gearbox overhauls. They design and manufacture the gearboxes for the MH-60 J/T aircraft. The data and specifications are owned exclusively by Sikorsky. They are the only known company that has the technical expertise to overhaul, incorporate service bulletins and test the gearboxes. The Naval Aviation Inventory Control Point, Philadelphia, PA (NAVICP) is the Primary Inventory Control Activity (PICA) for the gearboxes. In accordance with PL.108-136, 802, NAVICP has the sole responsibility for certifying manufacturing and servicing contractors for common MH-60 items used by the Navy and Coast Guard. The parts listed in this requirement are currently used on the Coast Guard MH-60 J/T aircraft fleet. The gearboxes are interchangeable throughout the Coast Guard MH-60 J/T Fleet. There are no acceptable alternate part numbers. Market research through speaking with gearbox vendors at the Helicopter Association International (HAI) trade shows, internet searches and searches of various subscription inventory locator services such as Haystack and PartsBase have not resulted in locating any other approved sources other than Sikorsky. The Aircraft Maintenance Repair and Overhaul (MRO) convention was attended in 2010 by ALC engineering and contracting personnel. Gearbox overhaul and manufacturing companies were specifically sought out as possible sources for the MH-60J/T gearbox overhauls. Some companies have the capabilities but do not have access to a complete line of overhaul parts or the most recent technical data. These companies rely on the government to provide these materials. The USCG did not purchase data rights with the HH-60 procurement and does not have access to current design documents.

(6) A description of efforts made to ensure that offers are solicited from as many potential sources as is practicable. A Sources Sought was released on the Electronic Posting System (EPS), Federal Business Opportunities (FedBizOpps) for market research to determine capable overhaul sources. The Sources Sought was posted on July 1, 2010 with a closing date of July 16, 2010. Sikorsky was the only qualified source to respond in accordance with the sources sought requirements and is a current Naval Inventory Control Point (NAVICP) approved source.

(7) Determination by the Contracting Officer that the anticipated cost to the government will be fair and reasonable. The Contracting Officer determines that the anticipated price will be fair and reasonable based on price analysis techniques and comparison with current prices and previously paid prices. Furthermore, certified cost and pricing data will be requested.

(8) Description of market research. Sikorsky is the OEM of the gearboxes. They possess the necessary data, tools, test equipment, facilities, skills, labor, manuals, and quality control systems peculiar to the overhaul of the gearboxes. In order to maintain integrity of the gearboxes and ensure compatibility of the replacement parts and overall safe operation of the aircraft, overhauls must be obtained from the OEM, an OEM approved source or have NAVICP source approval. A Sources Sought was released on the Electronic Posting System (EPS), Federal Business Opportunities (FedBizOpps) for market research to determine capable overhaul sources. The Sources Sought was posted on July 1, 2010 with a closing date of July 16, 2010. Sikorsky and two other companies responded to the sources sought. Sikorsky is a Naval Inventory Control Point (NAVICP) approved overhaul source and was the only qualified vendor to provide a response to the sources sought notice.

(9) Any other facts supporting the use of other than full and open competition. The gearboxes are Critical Safety Item’s (CSI) and the overhaul sources are restricted to the sources approved by the Navy. This is regardless of whether the overhaul is performed by the Government or a contracted entity. CSI parts that fail have the potential for catastrophic or critical consequences to personnel or equipment. This is a follow-on contract for repairs. In December 2005 ALC released a solicitation for a requirements type contract with a base year with four one year options. This current contract expires in May 2011. The only approved vendor was Sikorsky Aircraft Corporation (SAC). SAC operates in-house repair shops that have the specialized tooling, test equipment and supplies required to perform all levels of overhaul. In addition, their extensive in-house spares inventory provides immediate availability of all spare parts required for support. When combined with the exceptional experience level of their technical workforce, labor hours for troubleshooting are reduced, thereby increasing the aircraft’s availability. Engineering drawings needed for repairs and modifications to the Sikorsky MH-60J/T aircraft are produced by Sikorsky design engineers. Sikorsky also maintains a comprehensive engineering historical drawing library that reduces the time and cost required to generate drawing modifications. The USCG/NAVY liaison located at NAVICP queried the Navy logistician that manages the Navy’s gearboxes at NAVAIRDEPOT Cherry Point. The Navy logistician stated that Cherry Point sends their gearboxes to Sikorsky and that Sikorsky was the sole provider for overhaul and repair for the Navy.

(10) A listing of the sources, if any that expressed, in writing, an interest in the acquisition. A Sources Sought was released on the Electronic Posting System (EPS), Federal Business Opportunities (FedBizOpps) for market research to determine capable overhaul sources. The Sources Sought was posted on July 1, 2010 with a closing date of July 16, 2010. Sikorsky and two other vendors responded to the sources sought. Sikorsky was the only vendor to provide a response in accordance with the sources sought requirements and is the only Naval Inventory Control Point (NAVICP) approved overhaul source.

(11) A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for required supplies or services. The USCG did not purchase data rights as part of the initial system acquisition for the MH-60 J/T aircraft. The manufacturing, performance and acceptance data are proprietary to Sikorsky Aircraft. The Coast Guard does not have the technical data to provide information to potential offerors for manufacturing or to perform the overhauls. The NAVAIR Research and Engineering Group (AIR-4.0) and NAVICP are responsible for providing the engineering policies, processes and support necessary to ensure design integrity and airworthiness throughout the life cycle of maintained unique military aviation systems and equipment. Sikorsky Aircraft is the only approved source at this time. The USCG will continue to interface with NAVICP in order to stay aware of any OEM/NAVICP approved sources for gear box overhauls, at which point the CG may be able to effectively compete this requirement.