JA Emergency Repairs HQC010-20-P-0068-P00008 - Signed.pdf

Control Number: HQC010-22-20

JUSTIFICATION REVIEW DOCUMENT

Description of Acquisition: This action will increase the ceiling estimate for the Time and

Materials (T&M) Sub-Contract Line Item Number (Sub-CLIN) 1002AA which provides capability to perform unscheduled and emergency maintenance on the Cooling System for the

Central Distribution Center – Kaiserslautern (CDC-K) Kaiserslautern Cold Storage (KCS)

Facility. The proposed modification will increase the ceiling amount for the Sub-CLIN 1002AA from €92,555.00 ($106,348.39) to €941,755.00 ($1,082,103.87), enabling emergency repairs that exceed the current ceiling estimate of €92,555 ($106,348.39). The period of performance for this

Sub-CLIN 1002AA is 1 October 2021 through 30 September 2022.

Statutory Authority: 10 U.S.C., §2304 (c)(2), FAR 6.302-2, Unusual and compelling urgency.

Estimated Contract Amount:

HQC010-20-P-0068

Original Amount: €817,855 ($939,739.17)

J&A Amount: €849,200 ($975,755.50)

New Total Amount: €1,667,055 ($1,915,494.66)

* Exchange rate $1.00 = € .8703

Period of Performance: 1 October 2021 – 30 September 2022

Prepared By: Bernadette Dorsch Contract Specialist

Phone : +49-631-3523231 Date/Initials: 05/27/2022 - BD

Technical: John Groh Field Engineer

Phone : +49-162-2972794 Date/Initials: 05/27/2022 - JG

Requirements: John Groh Field Engineer

Phone : +49-162-2972794 Date/Initials: 05/27/2022 - JG

PCO: David Bremer Contracting Officer

Phone : +49-631-3523128 Date/Initials: 05/27/2022 - DB

Required Review Signatures: We have reviewed this J&A and find the justification adequate to support other than full and open competition.

Program Manager: N/A

Legal Counsel: Betsy Dulin Phone: 804-734-8000 x 48871

Signature: Date:

Division Chief: Michael G. Shaffer Phone: 804-734-8000 x 48681

Competition Rhonda N. Jackson Phone: 804-734-8000 x49816

Advocate:

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Office – Defense Commissary Agency (DeCA), Non-resale Contracting

Directorate, Contracting Branch Europe (CCQRU), Kaiserslautern, Germany.

2. Type of Contract Action – This action is for modification of contract HQC010-20-P-0068 with PROTEC Facility Solutions GmbH. The proposed modification will increase the ceiling values of Sub-CLIN 1002AA from €92,555.00 ($106,348.39) to €941,755.00 ($1,082,103.87), an increase of €849,200.00 ($975,755.50). The contract type is hybrid, incorporating Firm-Fixed

Price (FFP) for preventive and routine maintenance, and T&M for unscheduled and emergency work. DeCA’s surcharge funds will be provided to fund the Sub-CLIN.

3. Description of Supplies/Services – This action will increase the ceiling estimate for the T&M

Sub-CLIN 1002AA which provides capability to perform unscheduled and emergency maintenance on the Cooling System for the Central Distribution Center – Kaiserslautern (CDC-

K) Kaiserslautern Cold Storage (KCS) Facility. The proposed modification will increase the ceiling amount for the Sub-CLIN 1002AA from €92,555.00 ($106,348.39) to €941,755.00

($1,082,103.87), enabling emergency repairs that exceed the current ceiling estimate of €92,555

($106,348.39). The period of performance for this sub-CLIN is 1 October 2021 through 30

September 2022. The modification will increase the estimated total contract value as follows:

HQC010-20-P-0068

Original Amount: €817,855 ($939,739.17)

J&A Amount: €849,200 ($975,755.50)

New Total Amount: €1,667,055 ($1,915,494.66)

* Exchange rate $1.00 = € .8703

4. Authority Cited - 10 U.S.C., §2304 (c)(2), FAR 6.302-2, Unusual and compelling urgency.

5. Reason for Authority Cited - As described at FAR 6.302-2(a)(2), when the agency’s need for the supplies or services is of such an unusual and compelling urgency that the Government would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals, full and open competition need not be provided for. Pursuant to FAR 6.302-2, the incumbent contractor is the only available source because award under competitive procedures to any other source at this time would result in unacceptable delays due to the time required to compete this action, and requirement to mobilize a workforce capable of performing emergency maintenance work to enable continued operation of the KCS, which, if not fully operational, could result in up to $10 million dollars of frozen and chilled food products spoiling. Additionally, timely action to address the inability of compressors and condensers to maintain temperatures in the upcoming hot summer weather through repair or replacement actions would also result in the inability of DeCA Europe to distribute the frozen and chilled products to the 33 Commissaries it supports in the European area, denying the benefit provided to authorized Patrons under 10 U.S.C. 2481. The commissary benefit is the cornerstone of the military quality of life and it is essential that DeCA be able to provide resale items, including frozen and chilled products, to the 33 Commissaries in the European Area. An interruption in services would negatively impact DeCA’s mission to provide the commissary benefit for the military and their families.

PROTEC Facility Solutions GmbH currently performs the scheduled, preventive, unscheduled and emergency maintenance for the KCS facility, having qualified technicians with the required licenses and background on site to work on the ammonia based cooling system, which is very unique in Germany. PROTEC Facility Solutions GmbH has been performing this contract successfully since 1 October 2020, providing services that conform to the contractual requirements and terms and conditions. The company has the intimate knowledge and resources in place to provide the needed emergency repairs and potential equipment replacement, allowing uninterrupted service and mitigating loss of frozen and chilled products. The current contract contains T&M Sub-CLINs to provide emergency work, with estimated values established at contract formation based upon anticipated equipment failures and historical data from previous maintenance contracts. The scope and magnitude of the current emergency work far exceeds what was reasonable to contemplate when the estimates were developed that lead to the estimated amounts currently on contract. Once these emergency repair and replacement actions are completed, it is anticipated that there should be no more catastrophic emergencies in the contract’s future years that cannot be accommodated by the current existing CLIN amounts. As a result, PROTEC Facility Solutions GmbH is the only source available that has the necessary infrastructure and quality assurance measures in place to provide immediate support to address the critical repairs required to ensure the KCS facility can maintain operations and store frozen and chilled products in accordance with required food safety standards.

6. Efforts to Obtain Competition – A sources sought notification was not issued for this requirement due to the fact no contractors other than the incumbent is capable of providing the required repair and replacement services without causing unacceptable delays, disruption in service, and unrecoverable loss of frozen and chill products. Technical data packages, specifications, and engineering description have not been developed or are not available given the urgent nature of this action does not support timelines to develop them. As described below in paragraph 9, PROTEC will be required to obtain three quotes from repair and replacement parts vendors where feasible to provide competition at the sub-contract level. Contract

Opportunities notice required by FAR 5.201 is exempt for this requirement under the exception identified at FAR 5.202(a)(2) given the urgent and compelling nature of the requirement and

FAR 5.202(a)(12) as the action is being taken by a defense agency with performance outside of the United States and its outlying territories, with use of a local source.

7. Fair and Reasonable Cost Determination - Contract HQC010-20-P-0068 was awarded under full and open competition. The contractor is performing successfully. The action being taken is to raise the ceiling amount of Sub-CLIN 1002AA to have sufficient space for all potential emergency work to be completed. Because of the nature of the emergency repairs, a fully definitized price schedule is not achievable until the contractor has begun work to fully understand the complete extent of work required. The estimated T&M ceiling increase is based upon the field engineer’s assessment of the condition of the six compressors and three condensers currently experiencing challenges in keeping cooling levels required given the increasing temperatures and assuming a worst-case scenario that full replacement of equipment will be required, along with contingencies for additional work uncovered once the equipment is taken offline and further inspected. The maintenance vendor is currently assessing the full magnitude of what equipment repairs and replacements will be required, however, the full extent of required repairs will not be fully known until the equipment is taken apart and diagnosed.

DeCA Engineering uses an in-house maintenance system (SOMS) to track and manage all facility and equipment work, including the work supporting the cooling system at the KCS facility. This is the system that the vendor will use to submit the work to repair the system, which will be supported with quotes for parts and labor. The Field Engineer will review all submitted work from a technical feasibility and reasonability standard. Once a feasible and reasonable offer for work is concurred on by the Field Engineer, the work request will be reviewed by the Contracting Officer and the price fair and reasonable determination will be made. The Contracting Officer will rely on the techniques outlined in FAR 13.106-3(a)(2) to determine and document price fair and reasonable for each work effort submitted in the SOMS system supporting this emergency work performed against Sub-CLIN 1002AA. Additionally, as outlined in paragraph 9 below, we will require the vendor to provide three quotes for equipment where feasible which will also be used in the fair and reasonable determination. Once the price is found fair and reasonable for the individual repair work efforts, the Contracting Officer will approve the work request in the SOMS system, and the contractor will complete repairs. Based on the aforementioned, the contracting officer determines the prices offered by PROTEC Facility

Solutions GmbH will be found fair and reasonable.

8. Market Research - Market research did not reveal any contractors having the ability to facilitate the successful and expeditious execution of the services required via this modification.

Due to the complex and time sensitive nature of the procurement, it is unreasonable to expect that anyone other than the incumbent will be able to effectively perform the emergency repair work in a timely manner due to the time required to mobilize a trained and certified workforce with the ability to repair and sustain the ammonia-based cooling system which is unique in the

European area.

9. Actions to Increase/Foster Competition - DeCA Contracting Branch Europe discussed the feasibility to compete the emergency maintenance with the engineering staff, however, as outlined above, competitive actions will not meet critical timelines to support the emergency work required. Based on a review of historical contracting timelines, a competitive action to satisfy this emergency work is estimated at 150 days from receipt of a complete and actionable requirements package. In order to increase and foster competition, the Contracting Officer will require PROTEC Facility Solutions GmbH to obtain three quotes for replacement equipment when feasible to provide as many opportunities as possible for equipment suppliers. Finally, when the follow-on requirement to sustain and maintain this facility comes up for renewal, market research and the competition conducted for the current contract indicates that there are multiple vendors with both interest and capability to provide the services. As a result, it is anticipated at this time that the follow-on contract will be a competitive acquisition similar in nature to how this contract was initially competed.

10. Other Factors - PROTEC Facility Solutions GmbH is currently supporting the maintenance and sustainment of the ammonia-based cooling system at the KCS under contract HQC010-20-P-

0068. This is the first stand-alone contract supporting the KCS cooling system, with previous support having been provided under general facility maintenance contractHQC010-16-D-0002 which was competitively awarded on 1 September 2016. The decision was made by DeCA

Engineering to make the stand-along contract given the unique nature of the cooling system and host nation additional training and certification requirements that fall outside of standard repair and maintenance certifications. The contract was competitively awarded in FY 2020 with performance beginning on 1 October 2020. No J&A was used in the previous contract award, and it is not anticipated that the follow-on contract will require a J&A to limit competition at this time. Because of the unique nature and age of this cooling system along with safety compliance concerns by the host nation government, DeCA has been working with the United States Army

Corps of Engineers – Europe (USACE) to design, build and install a new CO2 based cooling system, which will be compliant with host national safety regulations, and is expected to be a more reliable system. The USACE design process has seen several delays, which has pushed back the timeline for the new system to be installed to FY24. As a result, DeCA will have to continue to try to keep the current aged system functioning longer than initially planned. The emergency work to be completed by increasing the T&M ceiling amount on Sub-CLIN 1002AA is expected to provide longer term capability for the cooling system until such time as the new

CO2 based system is installed.

11. Interested Sources – As a result of the authority cited under 10 U.S.C., §2304 (c)(2), FAR

6.302-2, Unusual and compelling urgency, no sources sought or request for information was posted in accordance with DFARS PGI 206.302-1. Because no formal posting took place given the urgent and compelling nature of the requirement, no other sources have expressed written interest in this requirement.

12. Fair and Reasonable Price Determination and Contracting Officer Certification:

I hereby determine that the price for this contract action will be fair and reasonable. I certify that this J & A is accurate and complete to the best of my knowledge and belief.

Name: David G. Bremer Signature: _______________________________

Contracting Officer Date: __________________

Technical Certification:

I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Name: John Groh Signature: _______________________________

Title: Field Engineer Date: _________________________

Requirements Certification:

I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Name: John Groh Signature: _______________________________

Title: Field Engineer Date: _________________________

APPROVAL

Based on the above mentioned justification, I hereby approve the increase in ceiling price for sub-CLIN 1002AA from €92,555.00 ($106,348.39) to €941,755.00 ($106,348.39), to support the emergency repairs for the Kaiserslautern Cold Storage Facility in Germany under contract

HQC010-20-P-0068, on other than full and open competition basis pursuant to the authority of

10 U.S.C. §2304 (c)(2), provided funds are available, or will be available, and provided that services herein described have otherwise been authorized for acquisition.

APPROVED:

Signature: ______________________________ Date:_________________________

Rhonda N. Jackson

Competition Advocate