JA 0222-21-315-00 Redacted.pdf

J&A Number: 0222-21-315-00 Code: 0241 P.R. Number: 21-REM-020

CLASS JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity

Naval Sea Systems Command (NAVSEA) Naval Surface Warfare Center, Philadelphia Division (NSWCPD), Contracts Division Code 0241.

2. Description of Action Being Approved

Establishment of a Basic Ordering Agreement (BOA) on a sole source basis for the procurement of Original Equipment Manufacturer (OEM) equipment to L3Harris Technologies, Inc. OEM hardware components for the systems listed in Table 1 below. Authority to act under this Class Justification and Approval (CJ&A) expires five years after issuance of the BOA master agreement.

Table 1: List of Systems Ship Class System

LPD 17 Engineering Control System DDG 1000 Ship Control System LSD 41/49 Advanced Engineering Control System

& Ship Control System LHD 1/LHA 6 Ship Control System LHD 1/LHA 6 Electronic Charting and Display

Information System CVN 78 Steering Gear Control System CG 47 Machinery Control System

3. Description of Supplies/Services

The planned acquisition provides for the procurement of hardware components in support of systems as listed in Table 1.

The estimated total value for these procurements is $39,995,295. Per Federal Acquisition Regulation (FAR) Subpart 16.703(a), the underlying BOA is not a contract; future delivery orders (contracts) will be funded at issuance. The BOA will contain an ordering period of 60 months. In accordance with FAR 16.703(c)(2), each basic ordering agreement will be reviewed annually before the anniversary of its effective date and revised as necessary to conform to the requirements of this regulation.

DEPARTMENT OF THE NAVY

NAVAL SURFACE WARFARE CENTER

PHILADELPHIA DIVISION

5001 SOUTH BROAD STREET

PHILADELPHIA PA 19112-1403

IN REPLY REFER TO:

This requirement is a follow-on requirement to contract N65540-14-D-0011 awarded to L3Harris on a sole source basis for material procurements for multiple ship class Ship Control Systems, and Navigation Control Systems by the Naval Sea Systems Command (NAVSEA) Naval Surface Warfare Center Philadelphia Division, on 22 Sep 2014 (ref. J&A #3351-11-022-00, approved 27 Jan 2011). Under this contract, L3Harris provided proprietary hardware for Ship Control Systems and Navigation Control Systems for which it was the primary designer and producer during the new construction phase.

Award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition. The cost to the Government to acquire an alternative source to provide material procurement support contained in this requirement would adversely impact the mission readiness and/or mission capability of LPD 17, DDG 1000, LSD 41/49, LHD 1, LHA 6, CVN 78, and CG 47 ship classes. Utilizing a new vendor to supply this highly specialized hardware for all these ship classes and unique systems would result in a substantial cost, estimated to be $22.4M for the engineering, drawing, hardware development, Equipment Qualification Testing and functional testing. This would bring the total estimated IGCE to $62.4M for a new contractor to develop, test and supply the hardware versus the current estimate of $39M if the strategy remains sole source to L3 to supply the hardware. The estimated cost is based on the historical costs of previous LHD SCS support contracts associated with development, integration and lifecycle support of the Automated Bridge System and Ship Control Systems. Table 3 below shows the breakdown of the additional $22.4M in costs. Contracted labor consists of technical evaluations and engineering analysis, hardware requirements development and review, hardware procurement and qualification review, and environmental/shock qualifications review. Material procurement consists of contractor testing, packing and shipping.

Table 3: Cost Estimate to Acquire from Alternate Source

Program Material Development EQT System Testing

LPD 17 Engineering Control System $131,299.50 $304,709.36 $355,182.44 $254,236.28 DDG 1000 Ship Control System $1,048,646.00 $880,862.64 $1,321,293.96 $440,431.32 LSD 41/49 Advanced Engineering Control System $227,625.00 $221,426.00 $316,220.00 $126,632.00 LHD 1/LHA 6 Ship Control System $896,600.00 $753,144.00 $1,129,716.00 $376,572.00

LHD 1/LHA 6 ECDIS $125,500.00 $193,929.20 $236,769.20 $151,089.20

LSD 41/49 Ship Control System $138,371.00 $152,193.60 $209,187.60 $95,199.60 CVN 78 Steering Gear Control System $1,470,080.00 $1,264,756.80 $1,878,032.40 $651,481.20 CG 47 Machinery Control System $2,005,523.00 $1,684,639.32 $2,526,958.98 $842,319.66 Total $6,043,644.50 $5,455,660.92 $7,973,360.58 $2,937,961.26 Total NRE Cost $22,410,627.26

The highly specialized systems listed above, have undergone and passed extensive tests and received certification by the Navy. The qualification tests include environmental qualification testing (shock, vibration, and electromagnetic interference), and system testing. Deviating from these certified systems would require re-certification efforts, redesign of the systems estimated at a total cost of $22.4M. This cost impact would be directly related to the additional funding required to procure, test and certify new hardware equipment, integrate and test software, conduct interface testing, as well as the time and effort expended to develop and qualify any other component parts.

Any new hardware equipment certified would also have a significant amount of non-recurring engineering cost to retest the system interface and software.

Failure to award this contract to L3Harris would jeopardize the lifecycle supportability of currently fielded systems and thereby degrade the mission readiness and capability of the systems listed in Table 1.

Thus, these highly specialized supplies are deemed to be available only from L3Harris the original source, for the duration of the 60 month ordering period, as award to any other source would result in substantial costs to the Government associated with designing and fielding new systems. This cost is not expected to be recovered through competition.

6. Description of Efforts Made to Solicit Offers from as Many Offerors as Practicable

In accordance with DFARS PGI 206.302-1, a request for information was posted to the beta.sam.gov website on 7 January 2021 and received one (1) inquiry from the following vendor:

B&H International LLC. On 15 January 2021, the posting closed on the website and the information was forwarded to the Subject Matter Expert (SME). Upon review, the SME determined B&H International LLC is not an authorized reseller of the required L3 Harris products.

Additional market research was conducted with Ruta Supplies Incorporated. L3 Harris identified Ruta Supplies as an authorized reseller. Ruta was contacted multiple times seeking a capabilities statement, but no response was received. Ruta’s capabilities, therefore, could not be directly verified.

A synopsis was posted to the beta.sam.gov website on 09 July 2021 and closed on 25 July 2021.

No responses were received. Individual orders to be issued under this BOA will be published on the beta.SAM.gov website. Any responses received will be considered.

7. Determination of Fair and Reasonable Costs

The Contracting Officer has determined that the anticipated cost to the Government for the supplies/services covered by the CJ&A will be fair and reasonable. Similar quantities of this requirement have been purchased from this company in the past and cost/pricing information was received on those past procurements. This information should be sufficient to support the fair and reasonable cost determination of this procurement. The Contractor will be required to submit a formal price proposal and sufficient information to support the accuracy and reliability of the estimate for each solicitation issued under this BOA. Technical analysts and contract specialists will perform analysis of the proposal, with assistance, as needed, from the Defense Contract Management Agency and Defense Contract Audit Agency. Experienced technical analysts and contract specialists with the aid of field pricing support, if necessary, will review the Contractor’s proposal. The Contracting Officer will use the results of this price analysis as the basis determining a fair and reasonable price.

8. Actions to Remove Barriers to Competition

The circumstances surrounding the need to obtain the required supplies/services without providing full and open competition will be reviewed annually by the Procuring Contracting Officer (PCO).

NSWCPD will continue to monitor the marketplace and identify potential sources of the supplies identified in this Justification. Any sources discovered that could potentially satisfy this specific procurement will be taken into account for any future requirements.