J A_HVAC_and_Jani_signed__24_Feb_16.pdf

U.S. Department of Homeland Security Federal Emergency Management Agency

Acquisition Management Division

Justification for

Other Than Full and Open Competition February 24, 2016

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

FEMA/TXNPSC

3900 Karina Lane Denton, TX 76208

COR: William Dunaway Tele: (940) 891-8661 Fax: (940) 323-2719

The Federal Emergency Management Agency (FEMA), Texas National Processing Service Center (TXNPSC), proposes to enter into a contract on a basis other than full and open competition.

2. Nature and/or description of action being approved:

This request is for a non-competitive sole source award to the Lessor and building owner, NGP V Denton TX, LLC (NGP V) located at 1650 Tysons Blvd Ste. 200 McLean VA 22102-4888, to reimburse the Lessor/building owner for all overtime (OT) costs associated with heating, ventilation, air conditioning (HVAC) and janitorial services at the TXNPSC. It is a cost reimbursement action for an estimated amount of $300,000 over a 5-year period (Base Year plus 4 Option Years). The type of funding will be 06 funds which will be requested from the specific disaster that the TXNPSC will support in the future.

3. Description of supplies/services:

NGP V will provide, on an as needed basis per FEMA’s direction, all OT HVAC and janitorial services for the TXNPSC, per the previously agreed upon price in Lease Agreement No. GS-07B- 14913, Supplemental Lease Amendment (SLA) #31. Per SLA #31, FEMA will pay these costs directly to NGP V. During periods of surge activity related to disaster events, humanitarian events, or special campaign events, HVAC and janitorial services may be required 24 hours a day, 7 days a week for an estimated 60 days throughout the year.

Period Unit Price Total

Base Year

12 mo

$5,000

$60,000

Option Year 1 12 mo $5,000 $60,000 Option Year 2 12 mo $5,000 $60,000 Option Year 3 12 mo $5,000 $60,000 Option Year 4 12 mo $5,000 $60,000

Total $300,000

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.3304(a)(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 Require Use of the Authority Cited:

Per Lease Agreement No. GS-07B-14913 the Lessor is responsible for providing utilities, HVAC, janitorial services, etc. to and for the TXNPSC facility. Thus, FEMA cannot, for example, acquire its own janitorial services, which is why Supplemental Lease Agreement (SLA) 17 and 18 state the lease agreed pricing for overtime usage of HVAC and janitorial services.

Background:

Historically, FEMA paid General Services Administration (GSA) directly for all overtime (OT) costs associated with heating, ventilation, air conditioning (HVAC), and janitorial services for the Texas National Processing Service Center (TXNPSC) located at 3900 Karina Lane, Denton, TX.

Due to an amendment to the Lease Agreement, FEMA will establish a contract directly with the Lessor, NGP V DENTON TX, LLC (NGP V) for the direct payment of all OT charges associated with HVAC and janitorial services. Specifically, under the terms and conditions of Lease Agreement No. GS-07B-14913, Lease Amendment 31, which was signed on December 4, 2015, it is now mutually agreed that FEMA will pay these costs directly to NGP V. The unit prices for HVAC and janitorial services are set in the above mentioned Lease Agreement and will not change unless the Lease Agreement is amended.

The original building owner, Harwood, had the TXNPSC facility built to FEMA’s specification and the lease was set up with GSA in May 2002. At that time FEMA hired their own janitorial staff, and had control of scheduling staff to meet the needs of the current disaster activity and hours. The lights and HVAC ran 24/7 and janitorial needs were not an issue. Four years later, in October 2006, FEMA decided to have the janitorial services written into Supplemental Lease Agreement (SLA) 13 during TXNPSC normal business hours of 7 am-7 pm where the Owner would be responsible for janitorial services. Unfortunately, HVAC and janitorial OT needs were not thought of at that time. On October 1, 2007 the building was sold to Kam Am Grund under SLA 16, who would not provide OT janitorial services at their cost, or HVAC OT usage outside the agreed upon leased hours. GSA stated it is standard practice to shut off HVAC systems in unoccupied facilities and not provide HVAC OT service without a usage fee (for wear and tear) outside of the agreed upon lease hours. This caused FEMA, GSA, and the owner to come to an agreed upon OT rate for these services and thus SLA 17 came into play on 10/01/2007. Date of verbiage correction for the statement in SLA 17, “The rate for overtime use of HVAC equipment beginning with the 61st hour of the year is $2.32 per hour” under SLA 18 which was effective 12/05/2008. The building was sold to NGP V on February 14, 2011 and the lease rolled over to the new owner as is and there is no SLA associated with the NGP V purchase.

The facility lighting and HVAC unit is connected to a central computer that the building engineer programs according to FEMA’s needs. On a normal leased day (7 am-7 pm), the lights will come on at 7 am and the HVAC will come on early enough to ensure that the facility temperature is within the Lease Agreement. At 7 pm the computer shuts off the lights and the HVAC system. The only exception is the server room HVAC, which runs 24/7 and is written into the lease.

The current process is that Reimbursable Work Authorizations (RWA’s) for both janitorial and HVAC OT services are established with GSA, whom would ensure that the OT hours we requested could be funded on a weekly basis. GSA would approve our request based off funding availability and then send the Lessor’s management company approval to provide the services.

They in turn would contact the janitorial supervisor to schedule staff, and the building engineer to program the computer for HVAC OT needs (he also ensures lighting is available as well). The Lessor would bill GSA, who would then send the invoice with their attached fee to FFC for processing thru an IPAC to FEMA for approval.

Historically, the TXNPSC Support Services Unit set up one (1) RWA for the janitorial and HVAC OT services and it would be funded for the whole year out of the TXNPSC budget. In 2015 HQ denied this budget line item and stated that the disasters should be paying for the OT incurred. This new practice caused multiple RWA’s (usually a new one each month) for GSA to process and caused confusion and incorrect payment out of the wrong RWA’s. To streamline the process FEMA, GSA, and the Lessor agreed to take GSA out of the process and to have FEMA contract directly with the Lessor for reimbursement of janitorial and HVAC OT. Lease Amendment 31 was the result of that agreement and incorporated into the lease, which led to this requirement for the HVAC and janitorial OT services.

While there are two (2) local Contractors on the GSA Advantage schedule capable of providing janitorial services at the TXNPSC Facility, the Lessor is responsible for the janitorial services per Lease Agreement No. GS-07B-14913 and the terms were negotiated through GSA when the lease was signed. Moreover, the Lessor’s building engineer, oversees all building maintenance as well as controls the computer programming of utilities and HVAC. In addition, FEMA was mandated via Lease Amendment 31 to reimburse the Lessor for OT HVAC and janitorial services. Thus, the Government cannot maximize competition as competition is not available and therefore technical data packages, statements of work or purchase descriptions suitable to maximize competition to the maximum extent practicable have not been developed or are not available.

Disapproval of this sole source request to NGP V could result in the TXNPSC facility being without HVAC and janitorial services during after-hours, holidays, and weekends in support of disaster efforts. When a disaster is declared the TXNPSC houses hundreds of employees, contractors, and other federal agencies. Not having HVAC or janitorial services during disaster surge events would impact FEMA’s mission. In addition, if HVAC is not provided FEMA would not be in compliance with GSA’s Lease Agreement heating/cooling standards of 68 +/- 2 degrees in winter and 72 +/- 2 degrees in summer.

6. Description of Efforts Made to Ensure that Offers are Solicited from as Many Potential Sources as is Practicable.

There are no actions FEMA can take to remove or overcome any barriers to competition before any subsequent acquisition for the OT HVAC and janitorial services required because as stated in Lease Agreement No. GS-07B-14913, Supplemental Lease Amendment (SLA) #31, NGP V will provide all OT HVAC and janitorial services for the TXNPSC. This a sole source procurement solely to reimburse the Lessor, NGP V, for any OT charges for HVAC and janitorial services.

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 will be fair and reasonable based on prices set forth in Lease Agreement No. GS-07B-14913 SLA #17 and #18 that was signed between GSA and the Lessor, NGP V Denton TX, LLC.

8. Description of Market Research:

FEMA conducted market research with GSA Facilities Maintenance and Management, Schedule number 03FAC Contractors to perform janitorial services. Hourly rates received from the Contractor is in line with the rates stated in Lease Agreement No. GS-07B-14913, SLA #31. For example, Centerra Integrated Services, LLC, and provided rates for janitorial services of $25.76/hr. for a janitor and $27.91/hr. for a lead janitor. TD Industries did not provide a response to our market research request by the time we submitted this acquisition package. Centerra Integrated Services is in line with the rate of $27.34/hr. for janitorial services outside of normal operating hours contained in Lease Amendment 31.

Rates contained in the Lease Agreement, along with estimates from planning groups on the amount of overtime that is expected, will be used to develop the IGCE as well as determine future budget planning, and the period of performance could be affected by funding limitations. HVAC and Janitorial OT rates were established and deemed fair and reasonable through the GSA Lease Agreement.

As a result of the market research collection of information, GSA cited that the HVAC OT rate at a 1 million square foot building in Fort Worth, Texas is $65.00 per hour. In addition, the HVAC OT rate in Arlington, Texas for an 83,310 square foot GSA owned building is $50.00 per floor, per hour. In this building occupants have to run two (2) floors, so it adds up to $200.00 per hour. Per GSA “the OT rate at which FEMA is getting charged for HVAC is well below what some of our leases are paying”.

9. Any Other Facts Supporting the Use of Other Than Full and Open Competition.

The Statement of Work for this requirement is not suitable for full and open competition, nor can it be modified to enhance competition as only the Lessor, NGP V, can provide, in accordance with GSA Lease Agreement No. GS-07B-14913, HVAC and janitorial services, including overtime usage, to the Lessor’s facility located at 3900 Karina Lane in Denton, TX.

The Government will be harmed if this sole source contract is not awarded to the Lessor, NGP V, as FEMA will not be able to provide services to disaster survivors outside normal business hours, and will therefore violate section 408 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. §5174, and Title 44 of the Code Federal Regulations (CFR) which prepares for and responds to both natural and manmade disasters.

10. A Listing of the Sources, if Any That Expressed, in Writing, an Interest in the

Acquisition.

A synopsis was not issued in FedBizOpps because the Lessor, in accordance with GSA Lease Agreement No. GS-07B-14913, is solely responsible for providing HVAC and janitorial services, including overtime usage, to the Lessor’s facility located at 3900 Karina Lane in Denton, TX.

However, an intent to award will be posted to FedBizOpps at https://www.fbo.gov/.

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 Supplies or Services Required.

FEMA will be unable to remove or overcome competition barriers unless GSA and the Lessor (NGP V) agree to amend GSA Lease Agreement No. GS-07B-14913 that allows FEMA to contract for HVAC and janitorial services.

12. Contracting Officer’s Certification. I certify that the data supporting the recommended use of other than full and open competition is accurate and complete to the best of my knowledge and belief.

2/24/16 Contracting Officer Date

13. Technical/Requirements Personnel Certification. I certify this requirement meets the Government’s minimum need and that the supporting data, which forms a basis for this justification, is complete and accurate.

Technical Representative Date

APPROVAL:

2/24/16 Contracting Officer: Date https://www.fbo.gov/ jkrieger Typewritten Text jkrieger Typewritten Text jkrieger Typewritten Text jkrieger Typewritten Text jkrieger Typewritten Text 2/24/16 jkrieger Typewritten Text