JA for BAE 814-817 Rev A Redacted Final_Redacted.pdf

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

JUSTIFICATION

1. Contracting Activity

Naval Surface Warfare Center, Carderock Division (NSWCCD), Contracting and Acquisitions Department.

2. Description of Action Being Approved

NSWCCD intends to use other than full and open competition to award a firm-fixed price, fixed price economic price adjustment, and cost reimbursable Definite Quantity and Indefinite Delivery Indefinite Quantity (IDIQ) contract to BAE Systems Platforms & Services Division (BAE). The contractual actions outlined within this Justification and Approval (J&A) will provide the material, manufacturing, assembly, delivery and support for Virginia Class Submarine (VCS) Propulsor Forward Subassemblies.

3. Description of Supplies/Services

This contract is for the manufacture and delivery (M&D), and all material required to manufacture and deliver the VCS Propulsor Forward Subassemblies for the FY24-FY25 VCS Hulls (SSN 814-817). This contract will also allow for procurement of advanced propulsor hardware, equipment, materials and engineering related services for propulsors as required by the program. This effort is a follow-on to NAVSEA contract N00024-21-C-4106, which provided for M&D of VCS hulls SSN 804-813 and Basic Ordering Agreement (BOA) N00024-20-G-4107, under which all required material was awarded via separate delivery orders (DOs) for SSN 806-813.

Material for SSN 804-805 was procured under NAVSEA contract N00024-15-C- 4103 with BAE. This contract will have an ordering period 36-months from the date of award and the first DO will provide the material for two Forward Subassemblies (SSN 814-815).

The estimated total dollar value is $91.790 Million as shown in Table 1.

The funding used for this contract may be SCN and/or OPN funds. SCN funds will be used to procure VCS Propulsor Forward Subassembly material and M&D, as well as engineering services and other direct costs. SCN or OPN funds will be used to procure general hardware, tooling and equipment, depending on the work identified in each DO.

DEPARTMENT OF THE NAVY

NAVAL SURFACE WARFARE CENTER

CARDEROCK DIVISION

9500 MACARTHUR BOULEVARD

WEST BETHESDA MD 20817-5700

IN REPLY REFER TO:

J&A Number: N00167-24-

RFPREQ-CD-808-0001.02

4. Statutory Authority Permitting Other Than Full and Open Competition

10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

5. Rationale Justifying Use of Cited Statutory Authority

BAE is the only proven source with the in-depth technical knowledge to manufacture, assemble, and deliver the fixed portion of the VCS Propulsor.

BAE (formerly United Defense LP) became the sole source provider for VCS Forward Subassemblies via contracts N00024 99-C-4059, N00024-04-C-4156, N00024-09-C-4137, N00024-15-C-4103, and currently N00024-21-C-4106. BAE remains the only qualified vendor available to meet the Navy’s VCS Forward Subassembly needs. The Government does plan to attempt and qualify another vendor(s) for future contracts for VCS Propulsor Forward Subassemblies, as discussed in paragraph 6 below.

BAE has maintained the necessary resources to continue the existing production process with its current assets, machines, tooling, and fully trained personnel. In addition, BAE has been instrumental in the significant changes made to the Propulsor fixed assembly iterations and possesses critical lessons learned through the management of configuration changes that are not easily transferrable due to the steep learning curve process of the Propulsor Forward Subassembly. Due to the exacting requirements and classified nature of the VCS Propulsors, award to any other source would cause the Navy to miss the scheduled In-Yard Need Dates for the next four VCSs, critically impacting fleet readiness and mission capabilities.

The existing M&D contract, N00024-21-C-4106, was awarded to BAE for the manufacture, assembly, and delivery of the fixed portion (including Forward Subassembly and Aft Subassembly) of the VCS Propulsor to support construction of the FY20-FY24 boats. The existing BOA, N00024-20-G-4104, was awarded to BAE as well to provide material in support of the manufacture and delivery CLINs under N00024-21-C-4106, as well as for the inspection, repair, alteration, and replacement of Government-Furnished Property, Propulsor hardware, tooling and associated equipment in support of existing in-service units, new construction ships and support needed for Large Scale Vehicle efforts.

N00024-21-C-4106 was awarded in FY21 and will expire in FY25, and N00024-

J&A Number: N00167-24-RFPREQ-CD-808-0001.02

20-C-4107 was awarded in FY20 and will expire in FY24. Due to mission needs, the VCSs have continued to be constructed at an expedited rate and the Propulsor fixed assembly is on high demand. Construction to the VCS cannot be completed without the delivery of the Propulsor Forward Subassembly, and immediate follow-on contract support is required to prevent disruption of the FY24-25 boat construction schedule. The cost impact of a delay would result in the additional expenditures of taxpayer dollars that cannot be recovered through negotiations.

If the Government were to solicit the subject requirements, a conservative time frame for an alternate vendor to achieve the requisite qualifications and complete an approved first article unit would take two to three years.

Among other things, this time frame would encompass: developing the vendor's necessary manufacturing capabilities; conducting preliminary technical meetings and briefs with the new vendor; inspecting the vendor's facilities and verifying clearance requirements; certifying the vendor's specialized equipment and necessary tooling and; approving the vendor's processes and procedures. Even after the vendor obtains the requisite qualifications, the vendor would still require additional time for drawing review and analysis in anticipation of primary production and to establish supply sources for material requirements. Even before the two to three-year vendor ramp up, based on standard procurement lead times, it would take approximately two additional years to complete a competitive source selection.

Mission needs require the vendor to be "ready-in-place" with all requisite certifications, specialized knowledge, trained personnel and appropriate facilities to seamlessly execute the subject efforts on day one. However, the rate at which the VCSs are being built simply does not leave a large enough window for a new vendor to complete the necessary qualifications without causing a substantial delay in the construction schedule. An award to any other source would result in inefficiencies, substantial cost increases and, unacceptable delays in fulfilling the Government's operational requirements.

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

Practicable

On 6 June 2022, NSWCCD Code 02 released a Request for Information (RFI), N00167-24-VIRGINIA-FWD-MFG, on the Government Point of Entry (GPE) website. Responses to the RFI were due on 28 October 2022. Two companies expressed an interest in manufacturing VCS Propulsor Forward Subassemblies MAF (BAE and ). BAE, who is the incumbent under contract N00024-21-C-4106 and N00024-20-G-4104, indicated that it would be able to maintain current production rates, with no additional non-recurring costs or schedule impacts. response indicated that the company has a significant history of manufacturing complex components for the U.S. Navy; however, the majority of its experience is specific to electromagnetic systems (i.e. the Electromagnetic Aircraft Launching System (EMALS), generators and propulsion motors). noted that significant facility improvements would be necessary to meet the manufacturing requirements set forth in the references. Specifically, additional crane capacity, building/floor space and new large-scale machines (boring mill and CNC machine) would be necessary to provide with the manufacturing capability necessary to machine VCS Propulsor FWD assemblies. Additionally, requested four to six months to evaluate a request for proposal (RFP) for this requirement due to the exacting specifications and uniqueness of the Forward Subassembly and also requests to have the proposal provided as a deliverable under contract (Government funded). has also requested that the Government proceed via phased approach (five total phases), which are considered necessary to evaluate, develop and install the facility improvements necessary to meet the Government’s requirements, as well as phases to work through a traditional low-rate-initial-production process. This phased approach will directly affect ability to deliver components to the Navy on schedule; however, the exact schedule impact is unclear at this time. Based upon response, the Navy estimates that a two to three- year window will be necessary to identify facility requirements, procure the necessary building if required, install new equipment, and begin manufacturing. There will also be considerable cost impacts that are not known at this time, but are likely an over to the Government.

and multiple machines may be necessary to meet throughput requirements. The Government will engage with via site visits and data analysis to evaluate capabilities and determine a path forward for qualification. The Government will also work with other vendors that express interest for qualification purposes.

As a result, NSWCCD will post a synopsis on the GPE notifying industry of NSWCCD’s intent to award a sole-source hybrid firm fixed price (FFP) and cost plus fixed fee (CPFF) contract to BAE and will attempt to qualify as a potential vendor.

7. Determination of Fair and Reasonable Costs

In accordance with FAR 15.402, the Procuring Contracting Officer (PCO) shall ensure that all supplies and services provided under this contract are procured at a fair and reasonable price. The contractor will submit a formal price proposal with certified cost or pricing data and sufficient information to support the accuracy and reliability of the estimate. The contractor’s proposal will be reviewed by experienced technical analysts and contract specialists with the aid of necessary field pricing support. Assistance from the Defense Contract Audit Agency (DCAA) and the Defense Contract Management Agency (DCMA) may be utilized to analyze, evaluate, and negotiate. The PCO will use cost and price analysis, including historical cost estimating relationships from previous procurements, to determine that the final price to the Government is fair and reasonable.

8. Actions to Remove Barriers to Competition

At this time, BAE is the only identified source capable of meeting the Agency's propulsor needs within the specified period of time. The Government will attempt to qualify as a future vendor and work with other potential sources that emerge.

CERTIFICATIONS AND APPROVAL

TECHNICAL/REQUIREMENTS CERTIFICATION (FAR 6.303-2(c))

I certify that the facts and representations under my cognizance, that are included in this justification and its supporting data, except as noted herein, are complete and accurate to the best of my knowledge and belief.

APPROVAL BLOCK

Upon the basis of the above justification, I hereby approve, as Senior Procurement Executive of the Navy, the solicitation of the proposed procurement(s) described herein using other than full and open competition, pursuant to the authority of 10 U.S.C. 2304(c)(1).

Technical Director, Naval Surface Warfare Center Carderock Division

Signature Name Date