JA N69450-21-0337 N69450-20-D0002.doc

Department of the Navy, Naval Facilities Engineering Command Southeast (NAVFAC SE), Jacksonville, Florida. Approval is sought to increase the contract maximum not-to-exceed (NTE) amount for the Professional Architect and Engineering (A/E) Services Indefinite Delivery Indefinite Quantity contract (IDIQ) by $7,000,000.00, thereby increasing the total NTE amount from $30,000,000.00 to $37,000,000.00. NAVFAC SE procured an A/E IDIQ for the Southeast Area of Responsibility (AOR), providing professional design services to include labor, travel and other direct costs necessary to perform projects in the $200,000.00-$30,000,000.00 task order range. Although this contract is primarily for use within the Southeast AOR, the contract AOR can extend beyond Southeast if necessary. The IDIQ was solicited as a Small Business Set-Aside. It was awarded to the Schmidt-Prime Group, LLC (Schmidt-Prime) located in Pensacola, FL on 20 November 2019. The contract is for a period of five (5) years, with a contract completion date of 19 November 2024. The statutory authority permitting other than full and open competition is 10 U.S.C. 2304(c)(2), as implemented by FAR 6.302-2 – Unusual and compelling urgency. Hurricane Sally inflicted significant damage to Naval Air Station (NAS) Pensacola, FL when it made landfall on 16 September 2020. Initial estimates suggest total remediation efforts at NAS Pensacola exceed $443,000,000.00. Global Contingency Construction Contract (GCCC) support was engaged immediately following the storm to provide emergency stabilization efforts, including, but not limited to roof repair, debris clearing and removal, traffic management, and rip out/tear out of saturated facilities. The determination was made that all permanent repair efforts associated with Hurricane Sally would be procured via other methods, independent of the GCCC. In order to ensure the amount of sole source work provided to the GCCC remains limited to emergency/stabilization work only, the necessity to develop Design-Build (DB) Request for Proposal (RFP) packages for other competitive or local 8(a) procurements is urgent, considering these design packages often take months to develop.

While NAVFAC SE currently has five active A/E IDIQ contracts with sufficient contract capacity to support the urgent hurricane recovery needs, the use of the Schmidt-Prime A/E IDIQ for these design packages is the most cost effective solution, considering they are local to Pensacola, FL. Utilizing a local firm will eliminate the payment of significant travel costs that would be required if one of NAVFAC SE’s other A/E IDIQ were used to support this effort. Schmidt-Prime’s recent experience performing nearly identical work in support of Hurricane Michael recovery at Naval Support Activity (NSA) Panama City will further reduce costs and increase efficiency. They were awarded an A/E task order in early Fiscal Year 2020 to provide DB RFP packages for 10 facilities at NSA Panama City, experience they will be able to capitalize on for this design effort allow for greater efficiencies in pricing and performing the work. Additionally, awarding this design effort to Schmidt-Prime, a small business, will further demonstrate NAVFAC SE’s commitment to the support of socioeconomic programs during hurricane recovery efforts. This is particularly important considering substantial contract awards are typically made to large businesses under the GCCC for hurricane recovery efforts. The total value of design work required as a result of Hurricane Sally, which could not have been planned for and was not included during the acquisition planning of the IDIQ, is $7,000,000.00. While most of the immediate stabilization and repair efforts were procured on the GCCC, it has been determined local professional services should be utilized to the maximum extent practicable for design packages for competitive project solicitations. Critical repair work associated with Hurricane Sally will require additional contract capacity that exceeds the A/E IDIQ remaining unassigned capacity. The IDIQ contract was awarded with an aggregate NTE amount of $30,000,000.00, however, $13,525,138.00 (including $7,000,000.00 Hurricane Sally recovery efforts) in capacity has already been obligated, $1,569,145.00 in pre-negotiated Post Construction Award Support (PCAS) options are pending, and $19,800,000.00 in future pending requirements are slated to be procured on Schmidt-Prime’s IDIQ. Twenty-five design projects valued at $19,800,000.00 are identified and slated to be procured on this A/E IDIQ based upon project requirements, location and estimated dollar value. Current execution schedules require each task order to be awarded in Fiscal Year 2021. The planned project list, enclosure (1), provides a detailed list of the 25 projects and the preliminary Government estimate for each.

The delta between anticipated project costs and available remaining capacity is $4,900,000.00 through Fiscal Year 2021. This $4,900,000.00 capacity shortage does not account for the reservation of capacity for unforeseen modifications that commonly occur post-award. The typical “reserve” amount is 5% - 10%, amounting to $1,500,000.00 to $3,000,000.00 for a $30,000,000.00 IDIQ contract. Based upon the awards already made under this contract, pending PCAS options, planned future requirements and a planned reserve amount of $2,100,00.00, it is determined that an additional $7,000,000.00 in capacity is required to meet all current and future Fiscal Year 2021 requirements. Without the unplanned/unforeseen hurricane recovery work, the current contract capacity of $30,000,000.00 would have been sufficient to meet all planned requirements through Fiscal Year 2021. Further, the COVID-19 environment has a significant impact on mission readiness. Health and safety concerns have severely limited the pool of potential contractors available to the NAVFAC SE installations to execute work. Restriction of Motion (ROM) requirements apply additional negative impacts (delay and contracting opportunities). Schmidt-Prime is ideally located to support mission requirements of the gulf coast installations, and is currently under contract on NAS Pensacola, and NSA Panama City, FL, and has employees and a pool of subcontractors already established on the installations, and in the local to the community. Quarantine requirements apply additional negative impacts to mobilizing new contractors to the sites. The A/E IDIQ was competed as a total small business set-aside. In accordance with FAR 6.305, the approved J&A will be posted on beta.SAM.gov within 14 days after award of the contract modification. No additional market research beyond the qualifications of Schmidt-Prime was conducted because it is not practicable, for the reasons discussed in Paragraph 5 above. The Contracting Officer has determined the anticipated cost to the Government of the supplies/services covered by this J&A will be fair and reasonable. Mission essential repairs are still required. NAVFAC SE will pursue/investigate business opportunities other than the sole-source as requirements for Hurricane Sally are realized. A new $45,000,000.00 A/E IDIQ is currently being negotiated with a projected award timeframe of December 2020. NAVFAC SE will take appropriate actions that promote competition and small business goals that are in the best interests of the agency, stakeholders, and expenditure of tax payer dollars.