JA_HSCG40-17-Q-11003_Switchboard_WPB-87_Cutters_redacted.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

Under 41 U.S.C. 1901

Per FAR § 13.501(a) Sole source (including brand name) acquisitions

RFQ Number: HSCG40-17-Q-11003

Pursuant to the requirement of the authority of 41 U.S.C. 4901, as implemented by Federal

Acquisition Regulation (FAR) Part 13.5, Simplified Procedures for Certain Commercial Items, Special documentation requirements for Sole Source (including brand name) acquisitions and is justified by the following facts and rationale required under FAR § 13.501(a)(1)(ii) as follows:

1. AGENCY AND CONTRACTING ACTIVITY:

The Department of Homeland Security, United States Coast Guard (USCG), Surface Forces

Logistics Center (SFLC), located at 2401 Hawkins Point Road, Baltimore, Maryland proposes to award a contract on a basis other than through full and open competition.

2. NATURE/DESCRIPTION OF THE ACTION:

The SFLC anticipates awarding a sole source firm fixed price contract to Powergen Controls, LLC for the procurement of designed switchboards, p/n PGC001079 onboard WPB-87 Patrol

Boat Cutters. Powergen Controls, LLC is the Original Equipment Manufacturer (OEM for this switchboard and has proprietary data rights to the software and programming. This acquisition is for ten (10) switchboards with the proper preservation and packaging. The USCG intends to use

2017 AFC 45 funds to direct award a definitive firm fixed priced contract to Powergen Controls, LLC is a Woman Owned Small Business (WOSB) located at 7102 Brookside Rd., Suite 112

Pearland, TX 77581.

3. DESCRIPTION OF SUPPLIES/SERVICES:

This requirement is forthe procurement of ten (10) ship service switchboards p/n PGC001079 for installation on 87’ WPB USCG Cutters. The switchboard is critical to the operational needs of ten (10) WPB-87 Cutters. Without this critical upgrade, these ten (10) WPB-87s (approx 15% of the WPB-87 fleet) are in jeopardy of becoming not mission capable in FY17-FY18. This would have dramatic negative impact on the ability of the USCG to effectively perform its missions in the operational areas that these ten (10) WPB-87s perform their duties including but not limited to national security, search and rescue, maritime law enforcement, fisheries, illegal migration, human trafficking and drug interdiction.

HSCG40-17-Q-11003

4. IDENTIFICATION OF STATUTORY AUTHORITY PERMITTING OTHER THAN

FULL AND OPEN COMPETITION:

The statutory authority permitting other than full and open competition is 41 U.S.C. 1901 as implemented by FAR 13.5, Simplified Procedures for Certain Commercial Items.

5. DEMONSTRATION THAT THE NATURE OF THE ACQUISITION REQUIRES USE

OF AUTHORITY CITED:

In 2013, the WPB-87 Patrol Boat fleet began the process of replacing out of production Ship

Service Diesel Generators (SSDG). On 17 April 2013, contract HSCG40-13-D-11011 was awarded for the design and manufacture of WPB-87 replacement SSDGs.

PBPL Maintenance Standards state that the SSDG life cycle is 12,500 underway operational hours. The ten (10) WPB-87 Patrol Boats who are most in need of and will receive first replacements are:

1) PAMPANO

2) SKIPJACK

3) SAWFISH

4) RAZORBILL

5) COCHITO

6) PIKE

7) MANTA

8) OSPREY

9) AHI

10) IBIS

The Patrol Boat Product Line (PBPL) has put in place a waiver for these generators to operate up to 15,000 hours, which is the maximum allowable engine hours permitted before mandatory replacement, in order to extend the life until upgrades can be made. These ten (10) WPB-87s that are most overdue for upgrade are in jeopardy of becoming Not Mission Capable FY17-FY18 without this critical upgrade.

In accordance with SFLC’s Configuration Management Process Guide CGTO PG-85-00-670-S the WPB-87 and all USCG Surface Assets adhere to a strict doctrine of maintaining identical configuration of systems and equipment on each class of cutters. Identical configuration of the switchboard is absolutely critical across all WPB-87s for operation, maintainability, repair and parts support.

These switchboards must be manufactured using the OEM specifications, standards, software and programming. The switchboards must be identical in all aspects to the previously mentioned manufactured and tested First Article Prototype which is currently being installed on CGC

SEAHORSE, scheduled to be complete in August 2017.

Substantial duplication of cost and man hours would be incurred should the government choose to solicit industry again, for another vendor to design another WPB-87 Switchboard. Based on the previous $207,000 Switchboard design contract successfully performed by Powergen Controls, the USCG PBPL would expect to pay at least another $207,000 for a new design. The man hour duplication would easily exceed thousands of man hours expended by PBPL Engineering, PBPL

Support Staff and Contracting and Procurement Division (CPD) personnel to create specifications, solicit, award, manufacture and test another First Article Switchboard from the new vendor. Not only would this $207,000 cost not be recovered through competition, but having another firm develop a prototype, complete First Article Testing, and then begin production, would require approximately 8 to 12 months from time of award.

Thus the time to prepare the solicitation, post the solicitation, make award, manufacture and complete first article testing is estimated to be as long as two (2) years. This would create an unacceptable delay in fulfilling the agency’s requirements to maintain a mission ready fleet of

WPB-87 Patrol Boats. Due to previously experienced Switchboard compatibility issues discovered in PBPLs initial efforts to upgrade the WPB-87 SDG, the WPB-87 fleet is approximately 5 years behind the original anticipated replacement schedule. Numerous WPB-87 cutters are currently operating their SSDGs in excess of allowable operating hours under waiver.

Without the procurement of these Ten (10) tested and approved Powergen Controls designed

Switchboards, the Ten (10) most overdue WPB-87s cannot get the SDGs replaced – the

Switchboards and SDGs must be installed together as a system. These cutters cannot wait any longer for replacement SDGs and are in serious risk of becoming Not Mission Capable should this procurement be delayed for any reason.

6. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS IS PRACTICAL:

In an effort to solicit as many potential sources as practical, a sources sought notice was posted on

Federal Business Opportunities (FBO) on 08 February, 2017 and closed 21 February, 2017.

7. DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE:

The Contracting Officer anticipates the price will be fair and reasonable based upon the comparison with catalog pricing for similar products and the Independent Government Estimate

(IGE), which was derived from historical pricing of the previous contract for the prototype.

8. DESCRIPTION OF MARKET RESEARCH:

Recent market research was conducted from February 2017 throughout March 2017 in an effort to identify companies that have the capability of manufacturing the OEM switchboards. Market research was conducted by looking at various companies on the internet, available companies through Federal Supply Schedules, and historical data from previous contracts. Powergen

Controls, LLC in response to the Sources Sought notice posted on 08 February 2017, stated they are the OEM with no other authorized manufacturers or dealers. The compatibility of any other manufacturer’s switchboard design with the WPB-87 Patrol Boat is unknown, as none have been tested except the Powergen Controls design.

9. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND

OPEN COMPETITION:

The 87’ WPB switchboard system parts must conform to design, materials and operational requirements. In 2013, the USCG competitively awarded a contract to Powergen Controls, LLC for the original prototype to be installed onboard an 87’ WPB. As stated above, proprietary software which is installed on the main switchboard and controls and proprietary licensing for the hardware are proprietary to Powergen Controls, LLC and data rights were not obtained under the previous contract. The compatibility of any other manufacturer’s switchboard design with the

WPB-87 Patrol Boat is unknown, as none have been tested except the Powergen Controls design.

10. LISTING OF SOURCES, IF ANY, THAT EXPRESSED, IN WRITING, AN

INTEREST IN THE ACQUISITION:

A Sources Sought notice was posted on FOB on 08 February, 2017 and closed 21 February, 2017.

The following vendors responded:

The McHenry Management Group (TMMG)

600 Independence Parkway, Suite 105

Chesapeake, VA 23320

DUNS: 809425163

Veteran Owned Small Business

BMT Designers & Planners, Inc

Address: 4401 Ford Avenue Suite 1000

Alexandria, VA 22302

DUNS: 018539619

Large Business

Beier Integrated Systems, LLC

1150 North Causeway Blvd.

Mandeville, Louisiana 70471

DUNS: 790760644

Small Business

Philadelphia Electrical Equipment Corp

14 MT Pleasant Rd

Aston, PA 19014

DUNS: 062745773

Current Power Solutions, Inc.

5050 W. Greens Rd.

Houston, TX 77066

DUNS: 831358101

Powergen Controls, LLC

7102 Brookside Rd., Suite 112

Pearland, TX 77581

DUNS: 964853407

Woman Owned Small Business

MD Marine Electric

672 E 11thSt

Tacoma, WA 98421

DUNS: 156660149

Electronic Power Design, Inc.

15200 I-45 North

Houston, Texas 77090

DUNS: 191374149

Carolina Power Systems of Sumter, Inc.

551 North Pike East

Sumter, SC 29153

DUNS: 867701005

Fairlead Integrated Power & Controls, LLC

912 Ventures Way

Chesapeake, VA 23320

DUNS: 829419519

Veteran Owned Small Business

Numerous vendors responded to the Sources Sought HSCG40-17-Q-19006 with their proposed ability to manufacture Switchboards based on the USCG approved Powergen Controls design.

However, the OEM Powergen Controls, LLC responded with a letter stating that they have proprietary data rights to the software they created which operates all functions on the switchboard as well as OEM proprietary rights to the manufacturing. This prevents USCG from utilizing another vendor to manufacture Switchboards based on this design.

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:

The OEM Powergen Controls, LLC responded to the Sources Sought with a letter outlining their proprietary data rights to the software they created, which operates all functions on the switchboard, as well as OEM proprietary rights to the manufacturing. The Contract Specialist contacted Powergen Controls, LLC to investigate the possibility of the Government purchasing their proprietary data rights. On May 9, 2017 Powergen Controls, LLC responded with a letter stating ,“At this time, Powergen Controls, LLC is not willing to sell any proprietary software

Powergen has developed for installation in the switchboard & controls of vessel diesel generators.” The USCG will continue to engage Powergen Controls for the release of proprietary data prior to any subsequent acquisition. In the future, if Powergen Controls quotes a price for the proprietary data rights, the USCG will weigh the benefits of purchasing the data rights at that time.