Thales_JOTFOC_FINAL_Redacted.pdf

Justification for Other than Full and Open Competition

Under 10 U.S.C. 2304 (c)(1)

Only One Responsible Source and No Other Supplies Will Satisfy

Agency Requirements

Solicitation Number: HSCG40-15-R-20975

Pursuant to the requirements of the Competition in Contracting Act (CICA) as implemented by FAR Subpart

6.3 and in accordance with requirements of FAR 6.303-1, the justification for the use of the statutory authority under FAR Subpart 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 (DHS), U.S. Coast Guard Surface Force Logistics Center (SFLC), Medium Endurance Cutter Product Line (MECPL), located at 707 E. Ordnance Road, Baltimore, MD 21226 proposes to enter into a contract on a basis of other than full and open competition.

(2) Nature/description of the action being approved.

The SFLC intends to procure, on a sole source basis, 185 parts to support the continued operation of the TMR-

90 High Frequency Transceiver System at an estimated cost of In accordance with HSAM

3007, supplies valued under $10 million do not require a written AP; however acquisition planning was coordinated with the contracting officer and appropriate subject matter experts and was completed on 16 July

2015 with all parties in agreement.

This will be solicited as a sole source, requirements contract with fixed price delivery orders, containing one (1)

Base Year and four (4) Option Years, for the purchase of parts for the Thales Mackay Radio TMR-90 High

Frequency (HF) Transceiver System installed and used aboard cutter classes.

The OEM for this requirement is Thales Defense and Security, Inc. (TDSI), located at 22605 Gateway Center

Drive, Clarksburg, MD 20871, utilizing procedures established under FAR Part 6.3, Other than Full and Open

Competition, FAR Part 12, Acquisition of Commercial Items, and FAR Part 15, Contracting by Negotiation.

(3) Description of supplies/services.

The requirement is to provide 185 parts to support the continued operation of the TMR-90 High Frequency

Transceiver System, in addition to Technical Support and Training through visits to the Electronics Repair

Facility (ERF), C3CEN, in Baltimore, Md. six (6) times annually.

A summary of the government estimate per performance period is provided below. The detailed government estimate price breakdown is provided as Thales Comm IGE.

Base Year:

First Option:

Second Option:

Third Option:

Fourth Option:

TOTAL:

Thales Defense and Security Inc is the only company that holds proprietary rights to the required parts and therefore is the only company with the necessary technical data to ensure the fit, form and function.

(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

FAR Subpart 6.302-1, 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 authority cited.

The required parts are only available to the government from TDSI. These parts integrate into the current

TMR-90 HF Transceiver System which is capable of

. The current system provides reliable data and voice communications over High Frequency radio spectrum that is interoperable with DHS and DOD assets in secure and non-secure modes. The TMR-90 system configurations have been in place aboard multiple classes of Coast

Guard vessels since 2005 and will be utilized for at least another five years. The Original Equipment

Manufacture’s (OEM) specifications for these parts are proprietary property. The Coast Guard did not purchase this information under the initial contract for installation and subsequent attempts to purchase these specifications have been denied by the OEM. Adequate item information, documentation, and specifications are not available to develop appropriate purchase descriptions for full and open competition. The OEM is the only known provider meeting system requirements for form, fit, function and seamless integration into the existing system. Re-capitalization of the entire HF transceiver system would be the only alternative to using OEM equipment. An effort to re-capitalize the Power Amplifier portion of the system with equipment from the OEM has been denied at this time. The cost estimates for this effort were in excess of $25,000,000.00

HF is a critical component of communication aboard Coast Guard vessels which operate many nautical miles away from shore. It allows communication between DOD and other agency assets over great distances verse using VHF which has only Line-of Sight capabilities. The impact of non- award of this contract would result in a reduction of the vessel’s operational capabilities by as much as 75%.

(6) Description of efforts made to ensure that offers are solicited from as many potential sources as is practicable.

Acquisition Planning Forecast Record number F2015027014 was posted 21 July 2015 at http://apfs.dhs.gov.

Additionally, as required by FAR Subpart 5.2 a sources sought notice was posted on Federal Business

Opportunities (FedBizOps) site on 24 June 2015 detailing the requirement and notifying industry that it is the

Coast Guard’s intent to award a sole-source contract to the OEM TDSI for this acquisition (see FBO Notice). It also invited other vendors with the expertise and required knowledge for this work to submit information discussing such capabilities. This notice closed on 30 June 2015. No responses were received.

(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 pricing will be fair and reasonable based on prior acquisition history, including HSCG84-05-D-AAT131 awarded to TDSI on 2 August 2005 (Ordering Period 4 dated 1 August 2013 through 31 July 2015) which contains fair and reasonable unit prices for each of the required items, comparison to the Independent Government Estimate, and through negotiations, if required.

http://apfs.dhs.gov/

Price analysis may also be performed to ensure a fair and reasonable price is negotiated in accordance with FAR

15.404.

(8) Description of Market Research.

Market research as prescribed in FAR Part 10 was conducted by the Contracting Officer’s Representative between May and June of 2015. The Internet was searched using NSN, part numbers, and item names for a list of manufacturers/vendors that could provide suitable alternatives. The market research showed that only TDSI can provide the parts and that TDSI does not currently have any authorized distributors. FedLog, IHS-Haystack

Gold, NE-TIMS, Thomas Register, NE-TIMS, Supply Support Systems/Grams, and the Internet were used to attempt to locate additional manufacturers for the needed items, but none were found. Market research also indicates that the items are not available through other Government Agencies or Federal Stock Systems.

(9) Any other facts supporting the use of other than full and open competition.

The Government does not possess the technical data and/or drawings pertaining to the manufacturing of the parts, which are proprietary. Therefore, the Government does not have any data to compare other manufacturer’s parts to ensure the same fit, form and function nor does the Government possess the independent expertise to evaluate other manufacturer parts. Use of another manufacturer’s HF system parts would require extensive modifications to the existing HF system configuration, requiring multiple Time

Compliance Technical Orders (TCTO). Cost to re-capitalize the entire HF system across all Cutter classes could cost the Coast Guard in excess of $100,000,000.00.

The TMR-90 is the only HF transceiver system used aboard the aforementioned cutter classes and there is no secondary HF system. Failure of this system could lead to an adverse affect on the cutter’s primary and secondary missions and/or safety of the crew.

Additionally, Commandant's Instruction 4130.6A calls for configuration management. The OEM parts would preserve configuration management requirements on all aforementioned cutter classes to ensure effective logistics support and compliance with this Instruction.

(10) Listing of sources, if any, that expressed, in writing, an interest in the acquisition:

No additional sources expressed any interest.

(11) Statement of actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisitions for supplies or services required:

TDSI was contacted on 26 August 2015 regarding their position towards selling the data rights for the parts required under this solicitation. In an email date 27 August 2015, Ms. Mary Faccone, a representative of TDSI, states that TDSI does not wish to offer or provide unrestricted rights to the U.S. Coast Guard for the TMR-90

HF systems (see email attachment). In the future, if TDSI quotes a price for the proprietary data rights, the

Coast Guard will weigh the benefits of purchasing the rights at that time.