JA Bullard Bend BNSP Repair Signature rps 20220916.pdf

Control No.: CECT-NWO-22-17

CUI

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

MISSOURI RIVER, BANK STABILIZATION AND NAVIGATION PROJECT (BSNP)

BULLARD BEND REPAIR, River Mile (RM) 663

OUT OF SCOPE MODIFICATION CONTRACT W9128F21C0047

CONTRACTING AGENCY: United States Army Corps of Engineers, Northwestern Division, Omaha District (NWO), Contracting Division, Civil Works Branch (CECT-NWO-C), 1616 Capitol Avenue, Omaha, NE 68102.

1. DESCRIPTION OF ACTION: US Army Corps of Engineers – Omaha District (CENWO) requests approval to enter into an out-of-scope modification on firm-fixed-price contract, W9128F21C0047, 2021 Bank Stabilization & Navigation Project (BSNP) Structures Repair Project (RM 611 to 498) Missouri River, IA, MO, and NE. with Western Contracting. The current contract has a contract completion date of February of 2024. The contract is a firm-fixed price, small business contract in the amount of $12,962,258.50, which does not include this modification. The original contract was competed as a, invitation for bid (IFB) in 2021 as a small business set-aside. There were four bidders total with Western Contracting being the low bid and the awardee of the contract. Funding for this modification will be operation and maintenance (O&M) funds pursuant the Infrastructure Investment and Jobs Act, PL117-58.

The current working estimate for this modification is $454,756.

The proposed action is construction of 4 dike repairs to support the Missouri River, Bank Stabilization and Navigation Project (BSNP). Navigation is currently being impeded at the location of the proposed repairs.

Absence of immediate repairs will result in further degradation and a loss of navigation upstream or downstream of the location. The Omaha District is charged with operating and maintaining the navigation channel as part of the BSNP. The modification is to repair and return of configuration, restoration of the required and authorized purpose, for the return of unimpeded navigation traffic upstream and downstream of the project as per the BSNP mission. This action supports commerce, national and regional economic benefits, via the business located along the Missouri River, including several commercial navigators.

The proposed repairs would restore the navigation channel and prevent the loss of navigation through this part of the river. The repairs would be made by Western Contracting under an existing contract.

Western Contracting has adequate resources, experience, and capability to implement the repairs. The action would repair dike structures that support and enable a navigable channel, in accordance with the congressionally authorized and required depths and widths so that commercial navigators and private businesses can provide goods and services to the nation.

The four dikes are located at RM 663. All four dikes are located on an inside bend of the river. They are spread almost evenly across approximately ¾ of one mile of riverbank located on the left descending bank in Nebraska. Repairs are estimated to require placement of approximately 13,000 tons of stone via floating plant operation. The government owns the materials required and would be providing those materials from the Fort Calhoun quarry. The quarry is located directly on the bank of the Missouri River at RM 641. The contractor would not be required to truck or transport any materials across land. The entire operation will be on-river for the contractor. Materials would be loaded at the quarry onto the contactor’s material barge(s) and the contractor would transport the material upstream, via the river, to the construction site at RM 663. On-site operations are estimated to require 17 days. All other work, including loading, travel and transport, work plan development, preconstruction meetings, and surveys is estimated to add another 2-3 days. In total, the expected contract duration is approximately 21 days or three weeks.

Work must be completed NLT 01 November 2022.

DESCRIPTION OF SUPPLIES/SERVICES OR NATURE OF CONSTRUCTION: This is a construction contract which the contractor provides floating plant operations including labor, staff, and equipment to perform repairs on the BSNP. The work consists of placing government-supplied stone to repair four damaged BSNP dike structures at RM 663. The repair would restore the mechanics needed to enable the river to self-scour the navigation channel at this location. Degradation of these structures is causing sediment deposition in the channel and is an impediment to navigation. Immediate repair of the structures will enable the river to remove the deposited sediment on its own over the winter months and cause the government to avoid more costly repairs including dredging of the channel.

AUTHORITY CITED: 10 U.S.C. 2304(c)(2), as implemented by FAR 6.302-2, DFARS 206.302-2(b), PGI 206.302-2(b)(i) – Unusual and compelling urgency D&F.

REASON FOR AUTHORITY CITED: Expedited contracting procedures are necessary to performance time-critical emergency repairs of the Missouri River BSNP. The proposed repairs are urgent, compelling, and unusual.

Urgency. The urgency of this action is created by two factors primarily; 1) a lack of current legal compliance and navigability with urgent financial implications, 2) a limited hydrologic opportunity to affect the needed repairs.

Legal Compliance, Navigability, and Financial Implications. USACE is legally required to maintain navigation depths and widths which currently are not being provided at this location. This is due degradation of four dikes at this location. The inadequately functioning dikes have allowed sediment deposition to build up and an undesirable channel configuration at this location. While degradation and repair of BSNP structures is a routine occurrence, degradation that causes barges to scrape bottom and that threatens channel closure are much more urgent than routine repairs. Incidents like this are always considered urgent, especially due to the potential financial implications to the navigation industry and because they can quickly lead to a situation that costs the government significantly more than if repaired immediately. The situation is quickly worsening, thereby threatening an increase in repair costs and an expansion of the scope of needed repairs. Navigators are currently reporting ships are grounding at this location. To date, navigators have ultimately been able to pass however, as conditions deteriorate a complete closure at this location will occur if repair actions aren’t taken immediately.

Limited opportunity. Repairs are urgent due to the limited time the current hydrologic conditions on the river and climate forecasts for the FY23 navigation season restrict the time available to complete the repairs. Current hydrology is providing a limited window to repair the structures that takes advantage of the river’s energy to affect a portion of the needed repairs of the channel. Downstream tributaries are rapidly declining which has resulted in higher regulated flow support releases from upstream to meet downstream flow targets. Currently for a limited time, an additional 6,000 cubic feet per second (cfs) is passing through the work site at RM 663 until the end of November. As a result, it is expected that river flows through RM 663 will be modestly greater and afford the best opportunity to clear the sediments from the channel if the structures are repaired immediately. This will also maximize the time for the river needs to react the alterations and clear the channel. These repairs should be fully implemented NLT November 1, 2022, to allow the river to. clear the channel after the repairs are made. If completed in time it will potentially reduce the, the cost of potential dredging or more intense repairs would be avoided.

Recent climate forecasts suggest a high likelihood that flow conservation measures will be implemented at the start of the 2023 navigation flow support season (April 2023) due to projected drought conditions.

If these repairs are not made immediately, it is highly likely that additional sediment will accumulate in these areas throughout the winter months and the minimum flow support now expected at the start of the 2023 next season will be insufficient to break through this restriction to the waterway. The current state of the surrounding river structures is minimally effective at moving river sediments out of the channel and if the structures are not repaired immediately during this limited window of opportunity they will continue to degrade, likely prevent any navigation upstream or down. This could result in a need for dredging at this location in at the start of the 2023 navigation season and cost more money to repair if there is a failure to act in the next month.

Compelling. Maintaining the navigation channel is always considered compelling by the USACE. The government and the navigation industry are likely to suffer serious financial injury absent immediate action at this location. The navigation channel serves multiple ports upstream of the location of the needed repairs. These facilities typically handle dry bulk fertilizer, grain, soybean meal and oil, steel, lumber, salt, molasses, and feed stuffs. Based on 2020 shipping data for the Missouri River, the multiple ports upstream of this section a fully navigable channel could carry as much as $73,000,000 in cargo. If the channel becomes unnavigable significant commerce that could be affected, and the government bares the increasing cost of repairs for as long as the area remains unrepaired. These costs could increase dramatically if left to repair next navigation season. The financial implications that would be realized by both the government and the industry make the urgency of this repair very compelling. Details regarding the compelling nature of this effort are described below. The details focus on the 2023 navigation season. Although navigation traffic is currently utilizing the channel with difficulties the repairs won’t be effective for the 2022 season and any benefits from the repairs for this navigation season would be minimal at best.

The Port of Blencoe IA, is currently planning for significant expansion of services for the 2023 navigation season. Blencoe is a new port and any missed opportunities for Blencoe are more compelling than usual due to their need to secure and increase revenue. Currently, Blencoe is planning for approximately 80 barges with 120,000 tons of inbound commerce (primarily monoammonium phosphate fertilizer, but some potash and rock) and approximately 80 barges with 120,000 tons of outbound commerce (primarily, corn and soybean, but also some scrap metal) during the 2023 navigation season. Additionally, the Port recently became certified as a port for non-hazardous liquids and as a result, the Port is working to secure an additional 10-20 barges of corn oil for 2023 navigation season. Without a navigable channel shipping contracts cannot be secured and would practically stop navigation north of this section.

Blencoe is the port that most of the rock source for our structure repairs on the FY23 BSNP northern projects will be loaded from. The other location for loading rock is further to the north at Sioux City SD.

Any restriction on rock load out yet this season or for next season would likely have an adverse impact on schedules and increase of cost of the work as much as $5,000,000.

Additional cost is also likely if the site conditions are allowed to continue degrading and depositing sediment blocking the navigation channel. Should a dredge become necessary, it will add significant time and cost to the repair. Cost to secure a contract to clear the channel could be as much as $5,000,000.

The mobilization costs alone can be $500,000 for a dredge.

Beside the economic impacts of the restricted navigation channel there are also safety and environmental issues that must be considered. The current condition of the navigation channel increases the likely hood of a grounding to occur. The grounding of barge or tows could cause damage causing the spilling of cargo into sensitive areas. The added safety concern is the possibility of injury or death due to the grounding and the subsequent efforts to remove and repair the grounded vessel and cleanup of any spill of cargo.

Unusual. A combination of conditions and events has come together to create a very unusual circumstance which must be addressed. The unprecedented flooding and the resultant damage to BSNP structures, and the onset of drought conditions have left the navigation channel impeded and nearly impassable at RM 663. In addition, the normally available means for dealing with this situation are currently unavailable.

The Missouri River, Bank Stabilization and Navigation Project (BSNP) relies on system of thousands of river structures to concentrate and train river flows to efficiently move river sediments and create a self-scouring river navigation channel conforming to its authorized minimum dimensions to support navigation traffic from St Louis, MO to Sioux City, IA. Hundreds of these structures experienced significant damage from the 2019 flood. Due to the limited annual capability of specialized contractors and limited annual availability of suitable repair materials, the Omaha District initiated a multi-year repair program to leverage these resources in a prioritized manner based on potential risks to the connectivity of the commercial waterway under typical operating (i.e. river flow) conditions.

The predictability of actual river conditions has a high degree of uncertainty because of the unregulated contributions from the downstream tributaries and the considerable time lag (several weeks in some cases) it takes for the riverbed to adjust to the specific flow conditions at each bend. Until approximately early-to-mid August, there had been persistent rainfall occurring below Nebraska City (RM 562). Because of this, regulated flow support releases were only needed to meet the minimum service flow targets upstream of Omaha at RM 616. This minimum flow created a very unusual and delicate situation at the RM 663 bend. The situation has been continuously monitored and evaluated. Evaluations concluded that up until present, a repair action under those river flows would likely "clog" new bends downstream and exacerbate the issue. The course of action until now was to disseminate frequent survey info for the navigators to make the needed adjustments to their sailing lines.

Severe drought conditions beginning in late 2021 and conservation measures put in place during the 2022 navigation flow support season (April-November) significantly reduced the flow support available for navigation traffic. Flow support levels were not actually established until the impacts from the drought could be reflected in the March 15, 2022, storage check. The programmatic repair prioritization established in prior had no ability to anticipate the drought would be setting in during 2021. Additionally, there was no warning that the specific conditions realized now regarding the drought condition would elevate the priority of the repairs needed at RM 663. Until very recently it was thought that specific repairs at locations with circumstances like those at RM 663 could be deferred until later in repair process. The majority of contracted efforts to date have been focused on the most severely damaged structures located between River Miles 498-611, and any high-priority repair actions located above River Mile 611 have been performed by in-house forces.

Given the extraordinarily large backlog of repairs, limited resource capability, uncertain funding stream, and variability of actual realized flow conditions; these type of small but urgent actions have been best performed by our in-house fleet where USACE can provide a much higher level of responsiveness. Since July 2022 however, USACE floating plant assets have been under repair and remain unavailable. There is also a shortage of qualified in-house personnel to perform repairs. Normally, these in-house assets and personnel are available to address urgently needed repairs of this nature. Unfortunately, repairs to USACE fleet equipment are still being made in St Louis and NWO will not have a licensed boat pilot capable of making these repairs after October 2022. Qualified Pilots from other Districts are also not available.

The combination of circumstances, both the onset of the drought and the lack of available in-house means, have created an unusual situation which also supports the need for contracted support.

EFFORTS TO OBTAIN COMPETITION: There are no known 8(a) contractors with the capability of executing this work. Market analysis for the last several years and contracts for BSNP structure repairs has revealed few new sources of competition and revealed no companies (8a) that can be directly awarded a contract without competition. Even if an 8(a) was available, awarding this to an 8(a) directly would circumvent competition rather than obtain it.

The most recent effort to obtain competition for BSNP repairs included market research prepared in May of 2022. Three small business contractors were identified as known sources that could be solicited.

Those contractors included Newt Marine Service, Western Contracting Corporation, and Fenton Construction. Five (5) contractors ultimately responded to the FY22 BSNP solicitations, Newt Marine Service, Midwest Construction Company, Western Contracting Corporation, Legacy, and Fenton

Construction. Four (4) of those five (5) are eligible to submit a bid, Midwest Construction Company, Western Contracting Corporation, Legacy and Fenton Construction. Newt was disqualified during step-one of the solicitation due to an “unsatisfactory” CPARS rating. Legacy is located on the Mississippi river and would require significant resources to mobilize. Midwest would also require significant resources to mobilize. Western is currently mobilized and performing similar work on the Missouri and has capability to construct this project.

The contract identified for issuing a modification was competed as a small business IFB. It included a 15-day pre-solicitation and a 30-day solicitation. The award was made to Western Contracting from Sioux City IA. Since the time this contract was awarded, one new contractor, Fenton, has started bidding similar projects and has been awarded a contract based upon a competitive bid. Fenton is a new company and has proven to require intense project oversite. Adding this to their workload would strain, if not exceed, their capability.

Regardless, seeking further competition would result in unacceptable delays that would preclude making repairs during this limited window and likely result in interrupted and discontinued service upstream of RM 663. Delays would also result in significant cost increase in order to open the navigation channel for 2023 commerce. Pre-solicitation and solicitation timeframes (45 days combined) would place the potential for award in mid-September. BCOES would add to that timeframe as would the usual bonding and insurance timeframes as well as legal and BOB review. Two to three weeks of construction are also anticipated. Seeking additional competition would prelude repair of the structures in the timeframe required.

These repairs will be most efficiently repaired with government furnished materials currently available from Martin Marrietta Aggregates at their Fort Calhoun Dock at RM 631. Western Contracting is currently performing repairs of similar nature on structures located below RM 611 and is the only Contractor capable of completing the requirement at RM 663 without placing unnecessary risks to other existing USACE Contractual Commitments.

ACTIONS TO INCREASE COMPETITION: Usually, the Omaha District prefers to and does compete this type of work. Available and qualified contractors have proven limited in supply as demonstrated above and below this paragraph. The emergency nature, limited number of capable contractors working in the area, and the limited timeframe available has created a need to award this non-competitively. At present, the Missouri River Project Office believes only one contractor is available with the capability to perform the needed actions during the timeframe available. The efforts listed below demonstrate actions to increase competition for similar work.

Omaha District currently has an estimated 500,000 tons in BSNP work advertised as small business IFB in addition to this work. Four of the currently available small business contractors have been approved in step-one of a two-step process for that procurement. All four have invested in the current solicitation and are expected to bid. Several have verbally indicated the intent to bid. In addition, NWK is advertising approximately 1.8 million tons in similar work.

Since 2019, NWO has awarded nine (9) similar type of repair Contracts to four (4) different Contractors with a combined total in excess of $60M. Five (5) of these Contracts are currently active. NWK currently has five (5) active repair Contracts involving 4 separate Contractors valued in excess of $78M.

MARKET RESEARCH: The Omaha District has been advertising and competed this type of work for several decades. The pool of available and qualified contractors has typically been very limited.

MATOC’s have been utilized in the past and typically, only four contractors have been available. No MATOC is currently available. For a period of time between approximately 2017 and 2020, only two contractors were bidding BSNP repair work. At present, NWO only has 3 Contractors typically available with capability to perform this type of work (Western, Midwest, and Fenton). All three contractors have

Contract commitments and workload from Fenton and Midwest would be at risk if this work was added to their existing workload and both of those firms are qualified to bid on the upcoming FY22 BSNP contracts. This has the potential to stretch their limitations further.

Currently, there are no known 8(a) firms with the capability to perform this work. Market Research has been conducted multiple times in the last several years and no 8(a) firms have surfaced. Also, other discussions with Western and Midwest have revealed that they also are unaware of any 8(a) firms to sub-contract with.

There are no SATOC or MATOC available in the Omaha or in other districts. Kansas City District has a MATOC with limited remaining capacity that does not include adequate geographic scope. The northern extent of their MATOC contract ends at the Omaha District’s southern boundary near Rulo, NE.

In-house capability is not currently available. The Omaha District barge and tow are both out for repair and currently the district has no licensed pilots. Kansas City District has no pilots either. St. Louis District, whose capability focuses on dredging and lock and dam repairs, does not have a crew available that performs this type of work.

INTERESTED SOURCES: To date, no sources have written to express an interest. Any notices required by FAR 5.201 shall be published. Bids or proposals received shall be considered. Exception to policy is FAR 5.202(a)(2) since this is a sole source for unusual and compelling urgency.

OTHER FACTORS: Not issuing a Modification on an existing contract and instead deciding to develop and compete a new competitive contract award is time prohibitive based on the length of the navigation season and the depths needed to support construction and repairs on the Missouri River. This creates and urgent and compelling situation that can be mitigated if the contracting officer can execute a modification on the existing contract in the time necessary to conduct the repairs during the 2022 navigation season. These required repairs needed prior to the 2023 navigation season will not be possible if the decision is to award a new contract for this work due to the time required to initiate a new solicitation, which the advertising time required for the pre-solicitation and a full 30-day solicitation alone will place the award beyond the available window to complete the repairs.

At present, NWO only has 3 Contractors available with capability to perform this type of work (Western, Midwest, and Fenton). Contract commitments and workload from Fenton and Midwest would be at risk if this work was added to the existing workload.

Additionally, and as described in various portions of this document, no other sources of contractors appear available to perform this work in the timeframe available. No 8(a) firms exist here to conduct this work, even if the added expense of mobilization was justified. No SATOC or MATOC was found after consulting directly with Omaha’s contracting division and Kansas City District’s BSNP manager. St. Louis District doesn’t do this type of work and therefore doesn’t offer support with in-house or contracted resources.

As described above and again here, the technical data packages, specifications, engineering descriptions, statements of work and purchase descriptions suitable for full and open competition have not been developed and cannot be made available in the timeframe remaining. Pre-solicitation and solicitation timeframes (45 days combined) would place the potential for award in mid-September.

BCOES would add to that timeframe as would the usual bonding and insurance timeframes as well as legal and BOB review. Two to three weeks of construction are also anticipated. Seeking additional competition would prelude repair of the structures in the timeframe required.

TECHNICAL CERTIFICATION:

“I certify that the supporting data under my cognizance which are included in the Justification and Approval are accurate and complete to the best of my knowledge and belief.”

Name: Randy Sellers Signature: ____________________________________ Title: Project Manager

Date: 16 Sep 22

REQUIREMENTS CERTIFICATION:

"I certify that the supporting data under my cognizance which is included in the Justification and Approval is accurate and complete to the best of my knowledge and belief."

Name: Randy Sellers Signature: _____________________________________ Title: Project Manager Date: 16 Sep 2022

FAIR AND REASONABLE COST DETERMINATION:

“I hereby determine that the anticipated cost for the task order modifications will be fair and reasonable based on comparison to the Government Estimate, initial pricing in a competitive environment, and judgment of professional engineering and contracting staff on site.”

Name: John Hickman Signature: _______________________________________ Title: Contracting Officer Date16 Sep 2022

CONTRACTING OFFICER CERTIFICATION:

"I certify that the supporting data under my cognizance which is in the Justification and Approval is accurate and complete to the best of my knowledge and belief."

Name: John Hickman Signature: ________________________________________ Title: Contracting Officer Date: 16Sep 2022

APPROVAL

Based on the foregoing justification, I hereby approve the out-of-scope modification to contract W9128F21C0047. This modification will address repairs to BSNP structures at Bullard Bend, river mile 663 on an other than full and open competition basis pursuant to the authority of 10 U.S.C. 2304(c)(2) as implemented by FAR 6.302-2, Unusual and Compelling Urgency, and provided that the services described herein have otherwise been authorized for acquisition.

Date John Hickman, Contracting Officer US Army Corp of Engineers Omaha District