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J&A No: FY14-0294 1

Justification for Other Than Full and Open Competition 41 U.S.C. 3304(a)(1) – Only One Responsible Source

J&A No.: FY14-0294

Pursuant to the requirements of the Competition in Contracting Act (CICA) as implemented by the Federal Acquisition Regulation (FAR) Subpart 6.3 and in accordance with the 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 U.S. Department of Homeland Security (DHS), Office of Procurement Operations (OPO), on behalf of the Domestic Nuclear Detection Office (DNDO), proposes to enter into a contract with Sensor Technology Engineering, Inc. (STE) on a basis of other than full and open competition.

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

(a) Type of action: Firm Fixed Price Indefinite Delivery/Indefinite Quantity Contract

(b) Amount:

(c) Type of funding: Acquisition

(d) Year of funding: FY13 and FY14

(e) Brief Description:

DNDO has a requirement to procure a limited number of RadPack radiation detection backpacks and RadPack Maritime Accessory Kits on a sole source basis to meet the United States Coast Guard (USCG) and the Small Vessel Standoff Detection (SVSD) program backpack radiation detector requirements for the FY2014 and FY2015 period at an estimated value of $7.3M. This sole source procurement is a follow-on contract to a previous RadPack procurement (HSHQDC-08-C-00045) with STE that was originally competed using full and open competition on FedBid. The anticipated contract will be an Indefinite Delivery Indefinite Quantity (IDIQ) contract with a base period of one year and an option period of one year.

The RadPack and RadPack Maritime Accessory Kit are manufactured by and available only from:

Sensor Technology Engineering, Inc.

5553 Hollister Ave 1 Santa Barbara, CA 93117-3836

J&A No: FY14-0294 2

(3) Description of supplies/services.

The RadPack is a very sensitive gamma ray and thermal neutron radiation detector in a backpack configuration for use in the detection, interdiction and location of illicit nuclear materials. It is specifically designed to be easily used by trained law enforcement agents/officers, security force personnel, and emergency responders. The RadPack utilizes two side-looking 1.5” long by 0.5” diameter and four rear-looking 1.5” long by 0.5” diameter cesium iodide gamma-ray detectors.

The neutron detectors are an array of seven, 2” diameter by 14.1” long (13” active) helium-3 (3He ) proportional counters filled to a pressure of 39.3 pounds per square inch. When gamma rays or neutrons are detected at levels significantly above the natural background, the unit quickly alerts the operator by sounding an audio alarm, and lighting single digit and graphical displays on the handheld umbilical control panel, or sounding an audio alarm, lighting single digit and graphical displays, and vibrating on a wireless handheld control panel. The operator can easily locate the radiation source using the duty-cycle-based audio alarm, and/or the graphical displays. The RadPack is designed for operators who need to quickly detect and locate a radiation threat in an unpredictable radiation background.

The STE RadPack Maritime Accessory Kit consists of the following items that are separate and distinct from the backpack device itself:

Item Description

(3) Nylon Ratchet Straps 9’(feet) in length, marine environment Pelican Case w/ foam lining #1610 (IP67 rated); 1.7# Foam Lining and cutout location for wireless transmitter Wireless communications package

Transmitter, receiver, additional power supply and connecter cables. Package operates on 2 additional 2/3 lithium batteries (preferably Duracell® #123); battery life: 120 hours

Moderator for Pelican Case 1” of high density polyethylene (HDPE) on bottom of case not glued (Velcro)

Dry Bag (90 L) Optional use without backpack Connection fitting Attached to pelican case to allow for short control module cable attachment in pelican case and long cable attachment outside of case. Water tight connection and cap.

Extension Cable 35 foot cable from outside pelican case to control module in cabin area of vessel

Delivery Requirements: Specific delivery/shipping information will be provided in the individual DO. Government supplied 3He will be supplied to the vendor pursuant to FAR 52.245-1, Government Property (Jun 2007). After the receipt of Government-supplied 3He by the vendor, the requested RadPacks will be delivered starting within 60 days at a rate of 6 backpacks per month.

After the receipt of the delivery order, the requested RadPack Maritime Accessory Kits will be delivered starting within 60 days at a rate of 10 kits per month.

J&A No: FY14-0294 3

Item Unit Price Quantity Total Est. Value Backpack $ $ Maritime Accessory Kit $ $ Spare Parts $

GRAND TOTAL: $

(4) Identification of statutory authority permitting other than full and open competition.

The statutory authority under FAR 6.302 permitting other than full and open competition is 41 U.S.C. 3304(a)(1)The exception under FAR 6.302 pertaining to this acquisition is 6.302-1, “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.

a) Background Information:

The STE Radpack is the current system of record for the USCG’s radiation detection backpack program. The Radpack system consists of highly specialized equipment for detection, interdiction and location of illicit nuclear materials in a maritime environment and is suited to at least two current USGC mission areas. Having the ability to employ a single system in multiple mission areas is a force multiplier which leverages training and maintenance infrastructure already in place, translating to a reduction in overall lifecycle procurement and sustainment costs. Additionally, as the system of record, the RadPack is the only device that has undergone USCG specific performance and operational testing and been approved for use in the USGC environment.

b) Details covering what events lead to the situation requiring use of other than full and open competition procedures:

The testing regimen required to establish a new system of record would span an estimated 6 – 12 months to include time for Technical Reference Model (TRM) testing to validate compliance with USCG enterprise architecture requirements and additional time to develop and provide training in appropriate use and maintenance of the device. In light of the foregoing, an award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and unacceptable delays in fulfilling the agency’s FY2014 and FY2015 requirements.

c) Consideration of Alternatives:

For future radiation detection backpack requirements beginning in FY2016 DNDO anticipates conducting a full and open competition for a 3He alternative system. The supply of 3He is decreasing and therefore DNDO is seeking alternatives to 3He-based neutron radiation detection systems. In December 2012, DNDO released a Request For

J&A No: FY14-0294 4

Information (RFI) seeking information on neutron radiation detectors for backpacks and handhelds that do not use 3He technology. The intent of the RFI was to determine the feasibility of utilizing Commercial-Off-The- Shelf (COTS) or future COTS for alternative neutron radiation detectors. As a result of that RFI and the submitted technologies, a test campaign was conducted to evaluate alternative neutron radiation detection technologies in a well characterized test bed to allow comparisons between detectors. Based on the test results, 13 potential alternatives to 3He-based neutron detection were identified for backpack and handheld applications. Further testing is required to determine the suitability of each detector technology when fully integrated into deployable systems for specific applications as well as consideration of other relevant system and operational requirements. In support of further testing, an RFI (https://www.fbo.gov/spg/DHS/OCPO/DHS- OCPO/DNDO_14_BRD_RFI/listing.html) was released in June 2014 seeking information on non 3He backpack-based radiation detection systems (BRDs) to participate in a Radiological/Nuclear Interagency Characterization and Assessment Joint Test Program.

Manufacturers participating in the testing will be provided feedback regarding the performance of their BRD and the functionality of their alternative 3He neutron technology.

The DNDO is also currently in the process of conducting a System Threat Review (STR) and refining the operational requirements with the user community to support an eventual Request For Proposal (RFP) for the next-generation, non-3He backpack detector.

Furthermore, on May 14, 2014 DNDO posted a Special Notice (https://www.fbo.gov/spg/DHS/OCPO/DHS-OCPO/DNDOHe3/listing.html) on FedBizOpps informing industry that starting in FY2016, the Government will not be providing 3He to vendors and that we anticipate transitioning off 3He-based neutron detection systems for future procurements. No responses were received from vendors following this notice.

d) Applicable Authority and Explanation:

Pursuant to FAR 6.302-1(a)(2)(ii)(A) and (B), the required RadPack devices and accessories are deemed to be available only from the original source for a follow-on contract for the continued production of highly specialized equipment and no other supplies will meet the Government’s requirement. Until the next full and open competition is held for the 3He alternative system it is in the Government’s best interest to continue to procure the current USCG System of Record, the STE RadPack. At this time, the RadPack is the only approved radiation detection backpack that meets the USCG and SVSD requirements. Procuring a new type of 3He dependent device for only two years until a full and open competition is held for a 3He alternative system would compromise compatibility and uniformity, result in substantial duplication of cost to support additional testing, integration, and training that is not expected to be recovered through competition and introduce unacceptable delays in fulfilling the agency’s requirement for the FY2014 – FY2015 period due to the long lead time associated with conducting the USCG specific performance and operational testing required prior to deployment of such devices.

The cost estimate information below has been extracted from the approved Small Vessel Standoff Detection (SVSD) Lifecycle Cost Estimate (LCCE), dated April 21, 2014, and

J&A No: FY14-0294 5 is depicted in “then-Year” dollars. This information details cost estimates for activities that would have to be repeated if the DNDO were to procure a system other than the STE RadPack at this time.

In total, the program would have to repeat all activities performed during the acquisition stages indicated below:

Total Cost Duplication (Calculated in Then-year dollars as an output from the LCCE) Cost Element/Acquisition Stage Estimated Cost Planning $ Integrate & Test $ Implement $ Total $

The information provided herein does NOT include activities that are already ongoing in the Deploy/Support acquisition stage and would also have to be repeated.

e) Impact to Mission of J&A Not Approved:

At this time, the RadPack is the only approved radiation detection backpack that meets the USCG and SVSD requirements. Procuring a new type of 3He dependent device for only two years until a full and open competition is held for a 3He alternative system would compromise compatibility and uniformity, result in substantial duplication of cost to support additional testing, integration, and training that is not expected to be recovered through competition and introduce unacceptable delays in fulfilling the agency’s requirement for the FY2014 – FY2015 period due to the long lead time associated with conducting the USCG specific performance and operational testing required prior to deployment of such devices.

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

In 2008, a full and open competition was held on FedBid to establish a five year BPA for radiation detector backpacks for USCG. Four responses were received and only one, STE, was determined as ‘technically acceptable’ and therefore awarded the contract. This sole source procurement is a follow-on contract to the previous Radpack contract (HSHQDC-08-C-00045) with STE in order to sustain ongoing efforts to meet USCG’s and SVSD’s requirements for the FY2014 – FY2015 period until FY2016 when a new full and open competition will be conducted for the next-generation non-3He backpack detector.

As stated in section (5) above, an RFI was released to industry in 2012 soliciting input to government-sponsored test campaign for alternatives to 3He-based neutron radiation detection systems. The DNDO received an overwhelming number of responses and the test results are hopeful, identifying 13 potential alternatives to 3He-based neutron detection. The DNDO intends to continue communications with industry, including releasing our revised requirements for the next generation backpack once they are final. The DNDO anticipates receiving feedback from industry

J&A No: FY14-0294 6 on our draft requirements prior to releasing an RFP in order to maximize the potential number of sources for a robust future competition.

In addition, a synopsis was posted to FedBizOpps in accordance with the requirements of FAR 6.303-2 on July 3, 2014 notifying industry of DNDO’s intent to issue an award on a sole source basis for this requirement to STE. Two responses were received, however, follow-up market research has shown that these vendors are neither manufacturers nor resellers of Radpack devices, the USCG system of record, and deploying a new device across the USCG would result in duplication of costs for integration and testing, as well as unacceptable delays in fulfilling the agency’s requirements.

(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 prices(s) will be fair and reasonable based on prior acquisition history and by using cost and price analysis techniques described in FAR Part 15.4. In addition, certified cost and pricing data shall be required to be submitted by the vendor, in accordance with FAR 15.403-4.

(8) Description of market research.

At this time, the Government requires the continued procurement of the current “system of record” for radiation detection backpacks until alternative technologies can be government-tested in their full operational configuration and shown to have comparable performance to 3He-based technologies.

DNDO used a number of techniques and sources during market research. These included:

review of acquisition history; interviews with knowledgeable individuals in industry and government; review of government and commercial databases; Sources Sought Notices/Request For Informations (RFIs), and one-on-one meetings with vendors.

Based on the various techniques and sources described above, there is only one product – the STE RadPack that currently meets the USCG and SVSD requirements. STE is also the only distributor of this product.

Market research also indicated that, while there are other backpack products offered in the commercial marketplace, none meet the USCG or SVSD’s requirements. The RadPack is a highly specialized system suited to at least two current USCG mission areas. Having the ability to employ a single system in multiple mission areas is a force multiplier and leverages a training and maintenance infrastructure already in place, translating to a reduction in overall lifecycle procurement and sustainment costs.

Additionally, a synopsis was posted to FedBizOpps in accordance with the requirements of FAR 6.303-2 on July 3, 2014 notifying industry of DNDO’s intent to issue an award on a sole source basis for this requirement to STE. Two responses were received, however, neither of these vendors are able to provide Radpack devices, the USCG system of record, and deploying a new device

J&A No: FY14-0294 7 across the USCG would result in duplication of costs for integration and testing, as well as unacceptable delays in fulfilling the agency’s requirements.

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

None.

(10) A listing of the sources, if any, that expressed, in writing, an interest in the acquisition.

ThermoFisher Scientific Proportional Technologies, Inc. (PTI)

(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 DNDO is currently in the process of conducting a System Threat Review (STR) and refining operational requirements with the user community to support an eventual Request For Proposal (RFP) for the next generation backpack. This time will also allow industry to continue research and development of the 3He alternative technology and the commercialization of their product. DNDO intends to continue communications with industry, including the release of our draft requirements for the next generation backpack once they are finalized. DNDO anticipates receiving feedback from industry on our draft requirements prior to releasing an RFP in order to maximize the potential number of sources for a robust future competition.

Anticipated RFP release date is tentatively scheduled for the first half of FY16, but is subject to change based on feedback from industry.

2014-08-21T14:12:08-0400

JOHN A ZIU