JA APPROVED - REDACTED (2).pdf

Control Number: SPL 23-01 3 FEB 2023

(CUI - Source Selection Information - See FAR 2.101 and 3.104-4)

Justification Review Document for Other than Full and Open Competition

Program/Equipment: Procurement of Architectural-Engineering Professional Services contract associated with the design of real property for the VA Phoenix Remodel 2C Inpatient Ward, Solicitation No. W912PL23R0011.

Authority: Federal Acquisition Regulation (FAR) 6.302-1 Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. 10 U.S.C.3204(b)(B)

Amount: Estimated range of procurement is $250K-$500K with no options.

Prepared by:

Typed Name: Phone

Title: Date:

E-mail:

Contracting Officer:

Typed Name: Phone:

Date Reviewed: E-Mail:

Technical Representative:

Typed Name: Phone:

Title: Date:

Control Number: SPL 23-01 5 JAN 2022

Justification and Approval for Other than Full and Open Competition

1. Contracting Agency:

U.S. Army Corps of Engineers Los Angeles District 915 Wilshire Blvd, Suite 1109 Los Angeles, CA 90017

USACE, Los Angeles District (CESPL), proposes to enter into a sole source contract with Nagel Architects. Information from SAM.gov:

Nagel Services LLC 13890 Bishops DR STE 250 Brooksfield, Wisconsin 53005-6609

CAGE: 59DM0 EIN: N1J9HQFLG497

Business Size: 8(a), SDVOSB

2. Description of Action:

The requirement is for a new Architectural-Engineering (A-E) Professional Services contract associated with the design of real property. The contract will be firm-fixed price. Under the authority of the Economy Act, the funding type to be used is Reimbursable.

On May 3, 2018, the Phoenix Arizona Veteran’s Affair Health Care System (PVAHCS) awarded a task order for A-E Design Services on IDC VA258-14-D-0020-664 under task order 36C25818N0233 in the amount of . The Veteran’s Affair (VA) closed the Task Order out on The VA has asked USACE to provide a contract that includes follow-on A-E Services in support of necessary corrections to the Plans and Specifications in addition to providing Construction Phases Services for the construction of the project. This request was made in an email (attached) from Dawn White, VA COR dated October 26, 2022. Furthermore, Chris Beaubien, VISN 22 Network Capital Assets Manager, requests USACE to proceed with Architect of Record (AOR) Nagel Services, LLC.

3. Description of Supplies/Services:

The requirement is for A-E Professional Services associated with the design of real property.

The Scope of Work includes four separate tasks:

Task 1: Design Quality Review: This task includes review and evaluation of responses to all DrChecks comments in ProjNet to ensure all government review comments are fully satisfied and closed.

Task 2: Design Special Systems: This task includes design solutions (plans, specifications, and basis of design) for capabilities/infrastructure supporting Special

(Source Selection information - See FAR 2.101 and 3.104-4)

IT/Communication Systems, so that it can be integrated and is compatible with the existing building systems.

Task 3: Solicitation Phase Services: This task includes the BCOES phase, Solicitation Phase services, and Conformed sets of Plans and Specifications. The relevant architectural or engineering disciplines will address technical comments and answer technical Bidder inquiries, make required revisions to the solicitation plans and specifications, and furnish revisions to the Government so that they are complete and accurate for construction purposes.

Task 4: Construction Phase Services: This task includes the review of technical Submittals and Shop Drawings, respond in detail to Request(s) for Information (RFIs) submitted by the construction contractor, perform construction site visits to verify and validate construction compliance to include any commissioning activities against the approved plans and specifications, and As-Built reviews.

The estimated value of this action is in the range of $250K-$500K. There will be no Options.

4. Authority Cited:

10 U.S.C. § 3204(b)(B), as implemented by FAR 6.302-1(a)(2)(iii)(A) and (B). There is only one responsible source and no other supplies and services will satisfy agency requirements because competition would create unacceptable delays in fulfilling the agency’s requirements and there would be substantial duplication of costs not expected to be recovered through competition.

5. Reason for Authority Cited:

Nagel Architects is the original A-E Firm that developed a 100 percent design, possesses the institutional knowledge for the Basis of Design, and has already overcome the steep learning curve of PVAHCS’ criteria and requirements under task order contract

. The unique qualification of Nagel Architects is they are the Architect of Record (“AOR”) and carry the liability for the Plans & Specifications produced.

For this follow-on contract, the continued design development requires the A-E firm to accept all calculations, measurements, specifications, and drawings as the baseline for the correction to deficiencies effort. As the architect of record, Nagel Architects is the only known source that can deliver the level of continuity required for a complete A-E solution using the existing design as the baseline.

Nagel Architects has a level of technical familiarity and institutional knowledge of the project about the existing design, requirements, specifications, scope, site conditions, calculations, and building systems. The acquired specialized knowledge and experience with the project uniquely positions Nagel Architects as the only available source to perform the correction to deficiencies and A-E services without substantial duplication of costs to the Government. The retention of the architect of record through the construction phase to perform the identified construction phase services and inspections is also required to achieve continuity throughout the project and to preserve project timeline requirements, avoiding unacceptable project delays.

Justification:

USACE received its customer request from the VA on an Interagency Agreement (IAA) Form FMS 7600B Appendix. Consequently, the VA did not account for any design deficiencies as cited in the statement in block #15 as identified below:

“Note: The estimate assumes no issues with the existing design and that no redesign would be required due to changed site conditions or changed requirements. There is also an assumption the A-E contractor would be available and respond to USACE review comments in a timely manner with no additional contract action required for the A-E contractor to support.”

USACE is not changing the existing design or starting fresh. This effort is not a “midstream” model, rather it is a 100 percent design. Due to an agreement between USACE and the VA, the design has been subject to additional design reviews after acceptance by the VA to meet USACE requirements in order to solicit a construction contract. The Project Delivery Team (PDT) conducted its Design Quality Review and has identified 447 deficiencies. This discovery results in the need for Nagel Architects, the original A-E firm that developed the design, to provide continuing services as the AOR.

The VA started this design for the Phoenix Remodel Inpatient 2C Ward in May 2018 and shelved the design in April 2022. USACE received funding for this project in April 2022, to address the decades old hospital backlog of building infrastructure deficiencies and maintenance issues that have been delayed several years. Considering that the funds will expire on September 30, 2023, USACE will be required to return funds to VA by August 15, 2023, there is a compelling urgency to immediately acquire a Sole Source A-E Design Services contract with Nagel Architects. The award for A-E Services must be by no later than the end of February 2023, and the construction contract awarded by no later than the end of August 15, 2023.

USACE and VA are certain an A-E firm other than Nagel Architects represents unacceptable additional costs and delays to the Ward 2C renovation project. To award to an A-E firm other than the AOR for this effort would entail researching and learning the existing design work (“coming up to speed”) before the design completion and support could even begin.

The following characterizes unacceptable delays and duplicate costs that will impact the completion of the design for the VA Phoenix Remodel Inpatient 2C ward if using an A-E firm other than Nagel Architects:

1) Duplication of Cost

Task 1 - Design Quality Review (DQR):

There are 6 weeks allotted in the schedule for the AOR to respond to the 447 design deficiency review comments to work toward resolution/closure. Utilizing an A-E firm other than the AOR will require time to get up to speed on the full design:

reviewing the plans, specifications, basis of design, and other documents to fully understand the work for which they would become the responsible and liable party.

Based on the number of hours required by the USACE DQR PDT to just review and provide comments, it is estimable that time required A-E firm other than the AOR to “get up to speed” and provide coherent well-informed responses to USACE about the design deficiencies would be considerably more than that of the AOR.

USACE has performed an assessment on the cost that an A-E firm other than the AOR would incur and compared it to the estimated cost the AOR would incur.

USACE has determined that substantial additional costs would be incurred if an A-E firm that is not the AOR is required to to “get up to speed” on the existing design.

Task 2 - Design Special Systems:

There are 6 weeks allotted in the schedule for the AOR to develop and adapt a design solution for the Special Systems. Utilizing an AE firm other than the AOR will require time for the AE firm to get up to speed on the full design: reviewing the plans, specifications, basis of design, and other documents to fully understand the existing systems unique to this facility for which this additional design work would need to be integrated. This Task runs parallel to Task 1. As with Task 1, it is estimated that time required by a new AE firm to “get up to speed” would be considerably more than that of the AOR.

In addition, USACE has performed an assessment on the cost that an A-E firm other than the AOR would incur and compared it to the estimated cost the AOR would incur. USACE has determined that substantial additional costs would be incurred if an A-E firm that is not the AOR was required to “get up to speed” on the existing design.

Task 3 – Solicitation Phase Services:

There are 6 weeks allotted in the schedule for the AOR to support the Biddability, Constructability, Operability, Environmental and Sustainability (BCOES) review and Solicitation phase. In compliance with USACE ER 415-1-11, a BCOES review of the design will be conducted. This is a necessary step leading to construction award.

The BCOES review will generate USACE technical comments that will need to be addressed by the AE firm so that it can incorporated in the Plans and Specification documents. Similarly, the Solicitation phase support will need an A-E firm that is versed in the current plans and specifications so that during the construction contract bidding period, answering bidder inquiries, making necessary revisions to the Plans and Specification, and providing a Conformed Set (to include Amendments) are efficiently executed in the short amount of time. As with Task 1 & 2, it is estimated that the time required by a new A-E firm to “get up to speed” would be considerably more than that of the AOR .

USACE has also performed an assessment on the cost that an A-E firm other than the

USACE has determined that substantial additional costs would be incurred if an A-E firm that is not the AOR was required to “get up to speed” on the existing design.

Task 4 - Construction Phase Services:

The Construction Phase Support Task is aligned with the duration of the Construction contract. As the AOR, the A-E is subject to FAR Clause 52.236-23 Responsibility of A-E Contractor and FAR 36.608 Liability for Government Costs.

USACE will use the Construction Phase to review and provide recommendations of approval or disapproval regarding construction Submittals, Shop Drawings, As-Builts conformance, answer RFIs, and Site Visits. The disadvantage of bringing on a new AE is the added costs to carry the Responsibility, in which USACE would consider the AE responsible for professional quality, technical accuracy and coordination of its products and services and Liability for Government Costs (in which the A-E Firm is responsible for additional costs [damages] to the Government caused by errors or omissions). USACE deems it is feasible for an A-E firm not the AOR to supplement their cost proposal to cover its liability issues, which could be as much as double the estimated costs of utilizing the AOR’s services. The advantage of sole sourcing is that the AOR already carries the Responsibility and Liability of the Design, which would not add any additional costs to cover these risks.

USACE has performed an assessment on the cost that an A-E firm other than the

USACE has determined that substantial additional costs would be incurred by an A-E firm that is not the AOR to learn the existing design during the construction phase.

In summary, USACE estimates substantial duplicate costs for an AE firm other than AOR to perform all the tasks. In addition to the cost impacts, there would be schedule impacts which USACE estimates to be at least an additional 14 weeks (approximately a little over 4 months) added to the schedule as discussed in the next section.

2) Project Delay Impacts

In accordance with the Brooks Act and EP 715-1-7, Appendix L, typical durations for AE contacting activities required to award a competitive AE contract is at 145 calendar days.

Utilizing a sole source procurement method would eliminate: Synopsis Period, Preselection, Selection, Selection Approval activities, resulting in a time savings of 81 days (approximately 11.6 weeks).

USACE has performed an analysis and estimates that using an AE firm other than the AOR would increase the allotted time in the schedule for Tasks 1-3. A new AE firm would utilize this extra time to “get up to speed” on the full suite of documents required in the design package including plans, specifications, basis of design, cost information and other documents. USACE estimates the total impact to perform the tasks in the SOW by an AE firm other than the AOR is estimated at 98 days (14 weeks).

3) Veteran Care Impacts

Veterans would greatly benefit from the project from both an experience and quality perspective. Firstly, the project will create single patient rooms which are now the expected standard across the industry for the privacy, peacefulness, and security of patients. These experiential measures have been linked to direct impacts on clinical outcomes; hence why experience measures are included in both VA and CMS (Centers for Medicare and Medicaid) standards when looking at holistic care. Furthermore, crowded rooms with multiple occupants may introduce logistical challenges for clinical staff, such as fitting equipment into the room and placement of clinical equipment/supplies. This is especially problematic if an emergent medical issue were to arise. Crowded spaces like the currently existing rooms may also lead to increased infections.

At times patients must have private rooms due to certain illnesses that could spread. When this occurs clinical staff need to block an entire room, which in the VA’s multi-patient room environment means closing off beds that other patients could have utilized. This is especially acute in Phoenix where occupancy is routinely 90%+. This 2C project is a tremendous upgrade for the Phoenix VA and delays would directly impact Veteran experience and quality of care.

According to the VA, the project has been delayed several years, thus delaying the upgrades causing a negative impact to our Veterans’ quality of patient care.

VA has submitted this project as the first of a sequence of projects to update all VA inpatient units from multi-patient rooms to single patient rooms. Single patient rooms have been the expected healthcare standard for many years in the private sector. As a top strategic and Veteran experience priority, it is imperative to get this sequence of projects started. A multi-month delay of this project would almost certainly impact the sequencing of the other inpatient units going to single patient rooms.

VA considers a delay of 2C will further impact the VA’s strategic objective of single patient rooms that has been on its 3-5 year strategic plan for multiple years. Ultimately, Veterans would have to wait longer for a critical functionality and clinical upgrade.

Alternative: Nagel Architects is the only firm that can update the design without delay in the schedule and without unnecessarily duplicative costs to come up to speed on the existing design.

If a schedule delay and likely increased cost were acceptable, USACE would revert to Full and Open Competition under the Brooks Act. Unfortunately, the only alternative is not awarding a contract at all, given the required project timeline and USACE’s availability of funding (15Aug23).

Impact: The alternative approach of awarding a competitive contract to an AE firm versus a sole source to Nagel Architects would cause the VA to incur delays upwards of 5 months. Such an impact would result in failing to meet the VA and USACE’s fixed schedule of awarding the construction contract by 15Aug23, which is funds need to be returned to the VA. The project has been delayed several years and the alternative would additionally delay the upgrades causing a negative impact to our Veterans quality of patient care.

Selection of Sole Source Contractor: Nagel Architects is the original AOR and no other A-E firm could perform the scope without increased cost and schedule due to learning curve on existing design, which Nagel Architects already possesses.

6. Efforts to Obtain Competition:

As required by FAR 5.201, a Notice of Intent to Sole Source using the authority at FAR 6.302-1 was published on SAM.gov.

7. Actions to Increase Competition:

Due to the liability of proceeding with Nagel Architects’ current Plan & Specifications, no other A-E Firm will assume responsibility for this requirement to follow on to a previous professional services contract of an architectural or engineering nature associated with design or construction of real property without unnecessary duplication of cost and unacceptable delays.

USACE received two expressions of interest from design firms, but the associated contractor inquiries suggested that firms other than Nagel Architects would cause an increase in the contract time and price to become familiar with the underlying design and to respond to comments.

8. Market Research:

Market Research was not conducted as Nagel Architects is the A-E firm who produced the original design documents. They are the only A-E firm that can fulfil the agency’s needs and only provider of this design.