Attachment_2_JTFOC_Propulsion_System_Groom_Signed_ _Redacted_Copy.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

UNDER 41 U.S.C. 1901 & 10 U.S.C. 2304 (c)(1)

Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements

RFQ Number: HSCG85-15-Q-P45B45

ATTACHMENT 2

Pursuant to the requirements of the Competition in Contracting Act (CICA) as implemented by FAR Part 13.5, Test Program for Certain Commercial Items, this justification for the use of the statutory authority is supported by the following facts and rationale required under FAR 13.501(a)(1)(ii).

1. AGENCY AND CONTRACTING ACTIVITY:

The Department of Homeland Security (DHS), U.S. Coast Guard (USCG) Surface Forces Logistics Center (SFLC) Icebreaker, Buoy and Construction Tender Product Line (IBCTPL) Contracting Office located at 300 East Main Street in Norfolk, Virginia 23510 proposes to enter into an Indefinite Delivery Indefinite Quantity (IDIQ) contract with Caterpillar Inc. (CAT) or certified CAT Technical Representatives under the Commercial Items Test Program of Federal Acquisition Regulation (FAR) subpart 13.5 on the basis of other than full and open competition.

2. NATURE/DESCRIPTION OF THE ACTION:

This justification for other than full and open competition seeks approval to award an Indefinite Delivery Indefinite Quantity (IDIQ) type contract with fixed price task orders for one (1) base year plus four (4), one (1) year option periods to the Original Equipment Manufacturer (OEM), Caterpillar Inc. (CAT) located at 100 Northeast Adams Street, Peoria, Illinois 62629-8000 or certified CAT Technical Representatives that are certified to perform services on the Caterpillar Model 3608 Marine Diesel Engine and provide genuine CAT OEM approved parts as necessary for repairs onboard the 225 foot (ft) Seagoing Buoy Tenders (WLB) class vessels. Services constitute the major portion of this requirement while parts will only be procured in conjunction with repairs if they are needed. Multiple awards are anticipate, however the Government reserves the right to award a single award.

The Independent Government Estimate (IGE) for services and parts is $ over five

(5) years. The type of funding shall be Operations and Maintenance (O&M). Base year task orders through September 30, 2015 will be funded with FY15 O&M funding. All subsequent task orders will require O&M funding for that current year.

3. DESCRIPTION OF SUPPLIES/SERVICES:

The SFLC IBCTPL requires technical services to conduct grooms and assessments of the engine propulsion system and associated components onboard 225-ft WLB class vessels. These services and components will satisfy the Coast Guard’s need for maintenance and propulsion plant system support.

The Contractor shall provide all personnel, labor, materials, parts, tools, test equipment, test fittings, supplies, consumables, and equipment to accomplish the following: conducting appraisals, inspections, reports, calibrations, grooms, repairs, and tests (pre-operational and operational), and associated reports on a recurring basis throughout the contract period and any option years exercised under the contract. Grooms and assessments, remote troubleshooting, telephone support, and associated reports will be conducted to support the 225 foot WLB class which consists of sixteen (16) cutters currently in service. Additional services and parts may be required for repairs, on-site technical troubleshooting, offsite / remote troubleshooting (telephone, email), and additional grooms due to planned maintenance and/or unplanned casualty response.

Under this contract it is anticipated that the contractor will be required to perform the following services to include but not limited to:

• Validate the system is operating within the manufacturer’s specifications.

• Ensure the proper communication and interoperability of the system components.

• Perform planned maintenance tasks for system components. Planned maintenance tasks are those recommended by the system component manufacturers and approved by the Coast Guard.

• Participate in dockside performance test, evaluation, and validation.

• Participate in underway performance test, evaluation, and validation.

• Repair, renew, adjust, calibrate, and test of improperly functioning system components as required.

• Provide genuine OEM approved parts as necessary for repairs.

The estimated dollar value for this requirement is:

Period Total

Base Year Option Year 1 Option Year 2 Option Year 3 Option Year 4

Total $

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 and 10 U.S.C. 2304 (c)(1) as implemented by Federal Acquisition Regulation (FAR), Subpart 13.5 entitled “Test Program for Certain Commercial Items”.

5. DEMONSTRATION THAT THE NATURE OF THE ACQUISITION REQUIRES

USE OF AUTHORITY CITED:

The limitation to use only CAT/OEM technical services and OEM approved parts must be enforced. The requirement of this contract must be performed by a certified CAT Technical Representative who is authorized by CAT to work on their Marine Diesel Engine 3608. CAT certified and authorized Technical Representatives are the only sources capable of:

(1) Accessing the OEM’s proprietary information, software, and tools pertinent to the tasking in the Statement of Work;

(2) Assisting with proper repair methods, and ensuring compliance with manufacturer’s procedures and standards during disassembly, inspection, repair, modification, calibration, and reassembly of the equipment/system;

(3) Generating a Computer Aided Marine Performance Analysis Report (CAMPAR) with the diagnostic test data and recommendations for the diesel engines;

(4) Conducting Marine Engine Performance diagnostic testing (CAMPAR or load bank testing), ensuring compliance with OEM, USCG, OSHA, and other pertinent procedures and standards;

(5) Providing genuine, OEM-approved parts.

This requires a Technical Representative contractor that possesses a certification by CAT to work on Caterpillar equipment. Within this subset of prospective bidders, not every certified CAT contractor is authorized by CAT to work on the 3608 engine. This is due to the size and complexity of the engine as compared to smaller-sized CAT engine families. CAT Defense and Federal Products stated that CAT Authorized Marine Dealers (AMD) are not authorized to perform work on the 3600 and C280 engine family in accordance with internal CAT business instructions. Certain CAT contractors performing services for the 3600 and C280 engines are not in compliance with CAT internal guidance, and technically would be performing services under their own discretion.

The Government may be faced with duplication of cost or unacceptable delays due to non OEM certified companies requiring proprietary information, software, repair process standards, tools and parts pertinent to the tasking held solely by the OEM and OEM certified technical representatives.

6. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS DEEMED

PRACTICAL:

Acquisition Planning Forecast Record number F2014024104 was posted on July 14, 2015 at https:///apfs.dhs.gov. Pursuant to FAR Subpart 5.2, in an effort to solicit as many potential https://apfs.dhs.gov sources as practical, a sources sought notice was posted on FedBizOpps (FBO) at www.fbo.gov 20 April 2015 and closed on 30 April 2015. There was a revision to the sources sought notice and the amendment was posted for an additional five days. Responses were received from three (3) contractors who were all certified and authorized CAT contractors to work on the CAT Marine Diesel Engine 3608 and can provide CAT OEM approved parts. These contractors listed examples of their work on the CAT Marine Diesel Engine 3608 for USCG vessels such as the USCGC MACKINAW; USCGC HARRY CLAIBORNE; USCGC ELM; and US Navy vessels USNS ARTIC; USNS DAHL; and the USNS SUPPLY vessels.

7. DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND

REASONABLE:

The Contracting Officer anticipates that the awarded price will be fair and reasonable based on historical prices paid, current market prices for parts and labor rates for similar repair work along with negotiations and other than certified cost and pricing data when necessary. Additionally, the Contracting Officer has a reasonable expectation that multiple quotes will be received and adequate price competition will exist.

8. DESCRIPTION OF MARKET RESEARCH:

In accordance with FAR 10.001 (a)(2), extensive market research was conducted by the Contracting Officer’s Representative (COR) and Contract Specialist from April to July of 2015 to identify companies capable of conducting propulsion system grooms and validations on 225 WLB A/B class vessels. Attempts were made by searching the internet for contractors that may possess the necessary technical data, drawings, manufacturing data, specifications and repair tolerances, and that could provide OEM equivalent services. As stated above, a sources sought notice was posted on FBO requesting technical services and incidental parts for propulsion system grooms, and assessments in accordance with OEM guidelines. The NAICS code was changed for this procurement from 541330 to 336611 to follow historical coding of groom procurements with the intention of increasing small business participation. Subsequently, the sources sought notice was amended to include the revised NAICS code and posted for an additional five days. Ten companies known to be certified were contacted by the SFLC IBCT Contracting Office, including the three contractors who responded to the initial sources sought notice. The same three contractors responded affirmatively to the revised sources sought notice.

Additionally, Caterpillar was contacted by the SFLC IBCT Contracting Office to inquire about acquiring the technical data and rights. Caterpillar responded to the request with a letter stating that the data was developed exclusively at Caterpillar’s expense and was therefore unavailable for release. The letter also stated that any full service Caterpillar dealer with 3600 marine certified technicians is fully capable of evaluating and repairing any 3600 family marine engines.

While other systems and parts may exist within the commercial marketplace, these CAT systems were selected for installation on these cutters. All technical information is proprietary to the OEM and is unavailable for the Government to evaluate alternate parts. The only contractors that can provide the required services and OEM approved parts are CAT certified contractors to work on Caterpillar Model 3608 Marine Diesel Engine.

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

OPEN COMPETITION:

Caterpillar Inc. possesses the most up to date critical technical data and/or drawings for the 225 WLB A/B class propulsion engines. The OEM along with their authorized dealers are the sole authorized service and incidental parts providers for the WLB A/B class and this data is Proprietary to Caterpillar Inc., we must continue to rely solely on the OEM for these specific services and incidental parts to meet our current needs. Changes to the vessel configurations and costs to develop or procure a replacement to the current propulsion system would be cost prohibitive.

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

INTEREST IN THE ACQUISITION:

Three (3) contractors expressed an interest in this requirement and are Caterpillar Inc. certified dealers:

Blanchard Machinery Company 3151 Charleston Highway West Columbia, SC 29172

Gregory Poole Equipment Company 4807 Beryl Road Raleigh, NC 27606-1406

Hawthorne Machinery Co.

16945 Camino San Bernardo San Diego, CA 92127-2405

We anticipate that there are additional CAT certified contractors that did not respond to the sources sought notice but will provide a quote in response to the solicitation. Only certified CAT contractors can effectively respond to all of the solicitation requirements once it is posted. In accordance with FAR subpart 13.501(a)(ii) the approved J&A will be posted with the solicitation in FEDBIZOPPS at www.fbo.gov website. If quotes are received from qualified sources, they will be considered.

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:

Caterpillar Inc. owns all data rights for the propulsion diesel engines. It is not anticipated that any future requirements can be competed on a full and open competition basis, other than competition among its certified representatives. However, the Coast Guard will continue its attempts to obtain proprietary data rights and to conduct market research in accordance with FAR Part 10, with a focus on locating contractors capable of meeting the requirement before http://www.fbo.gov/ subsequent acquisitions occur. The propulsion systems on the 225 WLB are approximately 20 years old. The Coast Guard will review the option of replacing the propulsion system for the 225’ WLB with a system that is more diverse for technical support. An up to date propulsion system may be able to be supported by multiple contractors.