J and A 20-19 SPEARS JOFOC.pdf

EXHIBIT 1

U. S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD)

JUSTIFICATION AND APPROVAL FOR OTHER THAN FULL AND OPEN

COMPETITION

Section 3 Performance Evaluation and Registry System (SPEARS/E04)

System Operations and Maintenance Support Services

1. IDENTIFICATION OF THE AGENCY AND THE CONTRACTING ACTIVITY,

AND SPECIFIC SPECIFICATION OF THE DOCUMENT AS A "JUSTIFICATION

FOR OTHER THAN FULL AND OPEN COMPETITION”.

Agency: U.S. Department of Housing and Urban Development (HUD) 451 7th Street SW, RM 5256 Washington, DC 20410

Contracting Activity: Office of the Chief Procurement Officer, Headquarters

2. NATURE AND/OR DESCRIPTION OF THE ACTION BEING APPROVED.

Approval is being sought to enter a one-year contract with NARTech, Inc. to provide uninterrupted and continuing Operations and Maintenance (O&M) Support services for the Section 3 Performance Evaluation and Registry System (SPEARS). A new sole source contract is being sought to ensure continuity of services while the follow-on competitive acquisition is being conducted.

Method of Contracting: New contract Type of Contract: Firm Fixed Price Funds: Contract action will be funded with OCIO’s Information Technology Funds

3. A DESCRIPTION OF THE SUPPLIES OR SERVICES REQUIRED TO MEET THE

AGENCY'S NEEDS (INCLUDING THE ESTIMATED VALUE).

Contractor support is required for O&M services for Section 3 Performance Evaluation and Registry System (SPEARS) steady state operations and maintenance.

Performance Period: 05/05/2020 through 05/04/2021 Estimated Cost:

4. AN IDENTIFICATION OF THE STATUTORY AUTHORITY PERMITTING

OTHER THAN FULL AND OPEN COMPETITION

Authority: FAR 6.302-1, Only one responsible source and no other supplies or services will satisfy agency requirements, 41 U.S.C. 3304 (a)(1)

J&A Log #20-19

5. A DEMONSTRATION THAT THE PROPOSED CONTRACTOR'S UNIQUE

QUALIFICATIONS OR THE NATURE OF THE ACQUISITION REQUIRES USE

OF THE AUTHORITY CITED.

The incumbent vendor, NARTech, Inc., located at 5918 Ipswich Road, Bethesda, Maryland 20814, has extensive experience in successfully providing expedited and efficient support services over the last 5 years. NARTech is the original developer of SPEARS and has in-depth knowledge of HUD SPEARS IT infrastructure and a clear understanding of HUD’s Section 3 business rules and operations. By virtue of having supported the steady state Operations and Maintenance of SPEARS, for the last five years, NARTech has the requisite knowledge and expertise to provide the required services and is the only vendor that can currently provide uninterrupted support. In addition, only this contractor can meet the current Operations and Maintenance support needs of the SPEARS system because they possess the unique knowledge, skills and abilities. This contractor also possesses the unique technical capability to undertake the Section 3 requirements, programs and interfaces. Another vendor cannot timely meet this requirement within the timeframe needed to maintain continuous and uninterrupted service to the system. Only NARTech has the knowledge, skills and capacity to expeditiously continue services on SPEARS with no interruption or additional lead-time necessary to learn the system interface and provide immediate support during this COVID-19 emergency. Awarding this contract extension to NARTech will eliminate any ramp-up costs, time, and risks associated with bringing on new contractor support staff. All NARTech staff supporting the current contract already have extensive SPEARS and Section 3 business knowledge as well as HUD public trust security clearances. A new vendor may take months to receive the necessary security clearances to access HUD’s infrastructure; therefore, putting the Department at risk of rendering the system inoperable for a long period time and losing valuable data to support Section 3 compliance efforts.

The requirement is essential because the SPEARS system supports critical needs of the Section 3 program. SPEARS supports HUD Secretary Carson’s Strategic Goal I (Advance Economic Opportunity) and Strategic Objective 8 (Promote Section 3) for over 5,000 HUD Grantees submitting over 50,000 Section 3 60002 annual filings and listing/searching Section 3 businesses and Residents suitable for contracting and job opportunities. The SPEARS application has multiple modules (60002 reporting, SPEARS Admin, Section 3 Business Registry, Opportunity Portal for Employer and Section 3 Residents).

A lapse in contract would jeopardize HUD’s ability to fulfill its goal of advancing economic opportunities for low and very low income residents and businesses that employ them. This would create a major financial and public relation burden to HUD and the Section 3 Grantees, as well as create economic hardships for the Section 3 businesses and residents.

The impact of the delay if this contract extension if not awarded by May 4th, 2020, is that there will be a break in service and a major business impact affecting all HUD program offices that provide funding to Public Housing Authorities and State/local government agencies aimed at advancing HUD’s overall mission to promote and advance economic opportunities for the low and very low income residents and businesses that employ them.

SPEARS is the Department’s system of record to capture HUD grantees’ compliance with Section 3 of the Housing and Urban Development Act of 1968 and its implementing regulation found at 24 CFR 135. The SPEARS application has multiple modules (60002 reporting, SPEARS Admin, Section 3 Business Registry, Opportunity Portal for Employer and Section 3 Residents). The requested extension will permit the automated reporting functions to capture compliance activities for use of approximately 80% of the Department’s funding. This includes but is not limited to Public Housing Operational and Capital funds;

Community Development Block Grant funds, HOME funds, Disaster Recovery, Lead Abatement and RAD funding. It will also allow funding recipients to effectively identify Section 3 residents and businesses for employment and contracting opportunities, therefore, increasing their ability to comply with the statutory and regulatory requirements.

In 2019, grant recipients for these programs received disbursements of more than $15 billion in funds for construction-related activities subject to Section 3 compliance. Failure to grant an extension of the current SPEARS contract will result in HUD’s inability to effectively monitor grant performance and use of these funds as intended under the applicable statutory and regulatory requirements. Without SPEARS, the Department will find itself unable to effectively collect and analyze qualitative and quantitative data regarding the use of HUD’s funds to ensure applicable compliance. The loss of this functionality will result in funded recipients being unable to report on accomplishments either accurately or timely, which will lead to errors, compliance issues and likely enforcement problems.

Without the extension of the existing contract, HUD will lose critical functionality and operations of SPEARS that include:

Inability to monitor over 5,000 grantees to ensure appropriate use of funds in accordance with statutory and regulatory requirements under Section 3.

Inability to upload/transfer LOCCS data into the SPEARS to ensure all funds align with appropriate reporting periods and program codes.

Inability to perform necessary complex data realignments to the system, which may render the system inoperable.

Inability to ensure that HUD’s approximately 5,000 Section 3 eligible grantees are compliant with applicable provisions of grant agreements awarded by HUD’s Offices of Public and Indian Housing, Community Planning and Development, and Housing.

In addition, Section 3 residents (which includes all Public Housing residents and low/very-low income individuals) are at risk of losing employment opportunities generated through the use of HUD’s funds.

6. A DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS IS PRACTICABLE,

INCLUDING WHETHER A NOTICE WAS OR WILL BE PUBLICIZED AS

REQUIRED BY SUBPART 5.2 AND, IF NOT, WHICH EXCEPTION UNDER 5.202

APPLIES.

A competitive follow-on acquisition is currently underway to procure O&M services for SPEARS (E04) under a new GSA BPA with an anticipated award date of FY21, 2nd Quarter. This acquisition will solicit offers from as many sources as practicable. As required by FAR Subpart 5.2, a notice will be publicized in the System for Award Management site, beta.sam.gov.

7. A DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND

REASONABLE.

The Contracting Officer will determine that the anticipated cost to the Government will be fair and reasonable based on the Independent Government Cost Estimate (IGCE) founded on historical pricing for the same or similar services.

8. A DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE

RESULTS OR A STATEMENT OF THE REASON MARKET RESEARCH WAS

NOT CONDUCTED.

Market research was conducted by querying government data bases which provided information relevant to this acquisition to determine the vendor pool for competition. A review was conducted of the results of recent market research conducted by HUD to meet similar or identical requirements; assessed performance of current and prior contractors;

queried government database of contracts and other procurement instruments intended for use by multiple agencies (www.contractdirectory.gov) using the word “Section 3”; and queried against the Small Business Administration (SBA), SBA Quick Market Search Results database using the key word “Section 3”. The original market research, conducted by the Program personnel in November 2019, on the competitive acquisition RCS-Q-2020- 00016, was conducted via Acquisition Gateway located on the SBA website. The original market research determined that there is adequate competition in the marketplace amongst small business that are capable of providing a commercial service.

Additional market research was conducted in early April 2020 under RCS-Q-2020-00153 for this one-year Bridge Contract to determine if the market has changed, and the market has not changed. The market research was performed by the Program Manager in conjunction with the Contracting Officer Representative (COR) and signed off by the Office of Small Disadvantaged Business Unit (OSDBU). The market research was conducted using the Small Business Administration (SBA) https://dsbs.sba.gov website that yielded results that were informative for the service requirements. Additionally, review of the 8(a) STARS II Industry Partners List to find qualified vendors was conducted. The market research conducted under RCS-Q-2020-00153 and captured in a Market Research Report dated April 7, 2020, revealed that NARTech, Inc. was the only vendor that had performed work on HUD’s Section 3 requirements, programs and systems, and has the requisite technological knowledge of HUD's Section 3 requirements, programs and systems.

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

OPEN COMPETITION.

The current contractor NARTech under HUD Contract # DU100I-15-C-20 supports the HUD Section 3 Performance Evaluation and Registry System (SPEARS). The contract is scheduled to expire on May 4, 2020. SPEARS supports HUD Secretary Carson’s Strategic Goal I (Advance Economic Opportunity) and Strategic Objective 8 (Promote Section 3) for approximately 5,000 HUD grantees that submit over 50,000 Section 3 60002 annual filings and listing/searching Section 3 businesses and Residents suitable for contracting and job opportunities. SPEARS is a critical system required to ensure compliance with Section 3 of the Housing and Urban Development Act of 1968 and its implementing regulation found at 24 CFR 135. SPEARS is also the system of record used for the compliance process and enforcement justification. The requested contract action will permit the automated reporting functions to capture compliance activities for use of approximately 80% of the Department’s funding. This includes but is not limited to Public Housing Operational and Capital funds;

Community Development Block Grant funds, HOME funds, Disaster Recovery, Lead Abatement and RAD funding.

In 2019, grant recipients for these programs received disbursements of more than $15 billion in funds for construction-related activities subject to Section 3 compliance. A lapse in O&M Support services will result in HUD’s inability to effectively monitor grant performance and use of these funds as intended under the applicable statutory and regulatory requirements. The Department has discontinued use of the paper form of the HUD 60002, instructing its funding recipients to utilize the SPEARS to report qualitative and quantitative data. Moreover, neither the Office of Fair Housing and Equal Opportunity (FHEO) nor the Office of Field Policy and Management (as an FHEO partner in the administration of Section

3) has the capacity or the bandwidth to perform the high-level IT functions currently performed by the contractor. Further, because the contract will expire on May 4, 2020, neither organization can adequately prepare to take over those functions before the contract expires. The loss of this functionality will result in funded recipients being unable to report on accomplishments either accurately or timely which will lead to errors, compliance issues and likely enforcement problems.

If there is a lapse in O&M Support services, HUD will lose critical functionality and operations of SPEARS that include:

Inability to monitor over 5,000 grantees to ensure appropriate use of funds in accordance with statutory and regulatory requirements under Section 3.

Inability to upload/transfer LOCCS data into the SPEARS to ensure all funds align with appropriate reporting periods and program codes.

Inability to perform necessary complex data realignments to the system, which may render the system inoperable.

Inability to ensure that HUD’s approximately 5,000 Section 3 eligible grantees are compliant with applicable provisions of grant agreements awarded by HUD’s Offices of Public and Indian Housing, Community Planning and Development, and Housing.

A lapse in services would jeopardize HUD’s ability to fulfill its goal of advancing economic opportunities for low and very low-income residents and businesses that employ these residents. It is crucial that the Department continues to maintain the ability to monitor the compliance of grantees regarding their training, hiring and awarding of contracts to Section 3 residents and businesses. Without accurate, timely data, the

Department lacks the data to assess its grantees compliance with the applicable regulatory and statutory obligations. Further, compliance data is needed to determine eligibility for certain grant opportunities. SPEARS permits grantees to meet their reporting obligation of individuals hired and contracts awarded as well as efforts made to meet goals during given reporting periods.

Additionally, the timely data collected by SPEARS is needed by the Department to evaluate the Section 3 program, to make informed decisions about grant funding and awards as well as meet its annual reporting requirements to Congress.

The incumbent, NARTech Inc, has extensive experience in successfully providing expedited and efficient support services for this work over the last 5 years. NARTech is the original developer of SPEARS and has in-depth knowledge of HUD SPEARS IT infrastructure and a clear understanding of HUD’s Section 3 business rules and operations. All NARTech staff supporting the current contract currently have SPEARS knowledge and experience as well as HUD public trust security clearances.

There are no estimated duplicative costs.

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

INTEREST IN THE ACQUISITION.

No sources have expressed, in writing, an interest in this acquisition.

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 THE SUPPLIES OR SERVICES REQUIRED.

A competitive acquisition for the re-compete of O&M services for SPEARS is currently planned under a new GSA O&M BPA. There was a pre-award protest on the GSA solicitation for the O&M BPA. This contract action will provide continuity of existing services under a new contract with the current contractor until the GSA pre-award protest is resolved, the BPA is awarded and then allow enough time to transfer the services from the incumbent to a new contractor.

12. CONTRACTING OFFICER CERTIFICATION THAT THE JUSTIFICATION IS

ACCURATE AND COMPLETE TO THE CONTRACTING OFFICER'S KNOWLEDGE

AND BELIEF.

See certification at Part 2, Form HUD-24012