JA Exception to Fair Opportunity_RHS PH2_GAC_Redacted.pdf

CUI

January 2025

5. RATIONALE/EXPLANATION TO SUPPORT CITED AUTHORITY:

V2X is currently storing the GAC tanks on Oahu, Hawaii under the current lease, which expires on 28 February 2026.

In support of NCTF-RH’s mission to restore the Red Hill Shaft (RHS) as an active, routine drinking water source for the Joint Base Pearl Harbor-Hickam Public Water system (JBPHH- PWS) to achieve increased water resiliency, the GAC tanks will be utilized as part of the Red Hill Shaft GAC Phase II project to install an interim water treatment system. Operation of the GAC system will not begin until the Navy has obtained Hawaii Department of Health’s (DOH) approval to reactivate the RHS. The lease is necessary until the decommissioning of the temporary water treatment facility. The initial completion date was September 2025 but has been extended to January 2027 based on several site conditions found at RHS that differ from the original project designs and other unforeseen site conditions that have impacted the task order.

V2X is the incumbent and is already performing the services identified above for NCTF-RH and has the requisite resources, skills, and knowledge to continue uninterrupted services. They are uniquely positioned to complete the required services with no undue delay, expeditiously addressing the impacts to mission, life safety, and security. Procuring requirements outlined herein through full-and-open competition is neither practical nor achievable since it will result in meaningful delays and substantial project cost increases while also exposing NCTF-RH to unnecessary risk and potentially negatively impacting the NCTF-RH’s mission objectives.

Based on the current Plan of Action and Milestones, the target contract award dates for the modifications are 27 February 2026 and 30 July 2026 respectively.

6. FAIR AND REASONABLE COST DETERMINATION:

To determine fair and reasonableness, the Contracting Officer will determine, using the procedures in FAR 15.404-1, that the order represents the best value to meet the Government’s needs. The Government will utilize historical data from prior GCSMAC Red Hill Task Orders, Task Order Modifications and the Independent Government Estimate. Upon completion of negotiations, V2X will be required to submit Certified Cost Pricing Data in accordance with

FAR 15.403-4.

The contractor’s experience with the existing drinking water quality Red Hill GAC system installation, operation and continued performance will eliminate the following for a new contractor: (1) Equipment and parts replacement and redundancy, (2) transition and training period, (3) specialized training for the use and maintenance of inline analyzers, and (4) the setup of subcontractors (e.g. administrative tasks).

Furthermore, the contractor has already procured the required GAC tanks, mobilized them from the mainland United States to Oahu, where they are pending installation upon project schedule opportunity. The cost of an individual GAC tank is estimated for per unit. The cost of 10 GAC tanks for the temporary treatment facility amounts to a total estimate of

V2X is the owner of this equipment and leases it to the government at a monthly rate for use on the project. Re-selecting this contractor will result in an estimated savings of approximately $5M on essential materials that otherwise would need to be purchased once again by another contractor.

Additionally, the amount of time manufacturing another set of tanks that meet specific project specifications should be considered. Per contractor provided information, the manufacturing of these GAC tanks has typically required extended lead times ranging from 40 to 52 weeks based on the manufacturer’s production schedule and production backlog. In addition, these tanks would need to be transported via vessel to Oahu from the mainland United States which adds even more time. This would inevitably result in severe project delays as the tanks are the most crucial component to the treatment system and installation cannot proceed without them.

Government estimates that further project delays have cost implications that could result in approximately in added cost if subsequent extensions are necessary. That amount is a result of additional tank leasing costs as well as the related project management cost that an extension would require.

The selection of V2X for the subject task order provides the government with the most fair and reasonable cost for completion of the project.

Use of the authority cited above is deemed appropriate due to the agency’s need for the required continued statutory and regulatory compliant services until a permanent solution is put into place. Otherwise, NAVFAC will not have in place a viable mechanism to continue this mission essential work to provide a secondary drinking water source.

7. ANY OTHER FACT SUPPORTING THE JUSTIFICATION:

Under a separate and previously awarded task order, V2X installed an emergency GAC system in response to contingencies that occurred at the Red Hill Bulk Fuel Storage Facility (RHBFSF).

V2X continues to operate that emergency system specifically for the Red Hill Shaft.

Consequently, V2X has demonstrated that they are capable of installing, appropriately assessing work and performing the required maintenance and operations to successfully maintain and operate a water treatment facility. Furthermore, V2X has staff that are trained and embedded within current government operations that remain active 24 hours on a daily basis at RHBFSF.

Due to V2X’s experience in performing the aforementioned task order at Red Hill, it is reasonable to believe that V2X has the technical expertise and experience to continue to complete the installation of the GAC Phase II system.

Upon approval of this J&A, NAVFAC Pacific will issue a Request for Proposal to V2X (Vectrus Systems Corporation).

8. ACTIONS TO INCREASE COMPETITION:

NAVFAC project P-716 design phase, which is the permanent solution to the temporary GAC treatment at Red Hill Adit 3, has been completed. This construction project will be competitively procured.