JA Pt Loma - Max Quantity Increase 11.5.2024 Redacted.pdf

DEFENSE LOGISTICS AGENCY

ENERGY

8725 JOHN J. KINGMAN ROAD

FORT BELVOIR, VIRGINIA 22060-6222

J&A Tracking Number 24-0016

Justification for Other than Full and Open Competition

1. Summary/Introduction:

The purpose of this Justification & Approval (J&A), presented under the authority of FAR 6.302-1 (a)(2)(iii)(B), is to provide information to support a change to the contract to increase the maximum quantity of services the government may order under Contract Line Item Number (CLIN) 0002 Extraordinary Site Support of contract SPE603-23-D-5002. The change to the contract would allow performance of critical maintenance services tasks associated with the existing environmental remediation system and prevent unacceptable delays in fulfilling Defense Logistics Agency (DLA) Energy requirements. DLA Energy is the contracting activity for petroleum products and services for the Department of Defense (DoD). DLA Energy contract SPE603-23-D-5002 with contractor Bhate Environmental Associates, Inc. (Bhate) provides environmental restoration services at Defense Fuel Supply Point (DFSP) Point Loma located at Naval Base Point Loma (NBPL) in San Diego, CA. The goal for the contract is to reduce long-term environmental liabilities and life-cycle costs through providing environmental remediation and achieve site closure by 2045. Although Extraordinary Site Support was anticipated during the planning phases of the procurement, the magnitude of the requirement was not fully known.

Pursuant to FAR 16.504(a)(4)(ii), the maximum quantity of services was set at 54 units of CLIN 0001, , and 112.5% of the total estimated value of CLIN 0002, .

Within one year of contract award, a clearer understanding of the maintenance requirements associated with the environmental remediation system emerged. Although there is an increase in quantity of services required, the type of services required are within the scope of the contract.

The most efficient and cost-effective means of meeting the requirement with the least disruption to the progress made towards fulfilling the environmental goals at DFSP Point Loma would be to modify contract SPE603-23-D-5002 in accordance with FAR 52.243-1 Changes-Fixed Price Alternate II (a)(1) to continue uninterrupted environmental restoration services through the end of the performance period of April 30, 2027. With the proposed change to the contract, the period of performance would remain the same: May 1, 2023, through April 30, 2027, with an optional extension period from May 1, 2027, through October 31, 2027.

The estimated dollar value change to contract SPE603-23-D-5002 for the modification to increase the maximum quantity of services under CLIN 0002 is . The change will be funded using Defense Working Capital Funds. The estimated total value from contract award would change from to .

Under the contract, Bhate provides environmental restoration, compliance, and facility maintenance services at DFSP Point Loma using best commercial practices. These services include operation and maintenance (O&M) of existing remedial systems, facility groundwater monitoring and reporting, data management activities, and professional services (project management and technical support). With over 21 years of expertise and extensive knowledge of

Justification for Other Than Full and Open Competition (Cont’d) (SPE603-23-D-5002 – Bhate Environmental Associates, Inc.)

order on the remaining three years of the contract. An additional sum of is anticipated to be ordered under CLIN 0002.

An increase to the maximum quantity under CLIN 0002 is necessary to support DLA Energy environmental restoration program goals at DFSP Pt Loma. As such, this action is to increase CLIN 0002’s maximum quantity stated in contract text B35 from 112.5% to 1,670.46%, , which will cover the anticipated order amount of . On September 25, 2024, the DLA Energy LEV funds manager verified that Defense Working Capital Funds are available to fully fund this requirement.

Having performed under the current contract since 2023 and under the previous contract since 2018, Bhate has the knowledge, skills, expertise, supplies, equipment, and personnel to perform the additional work required with minimal disruption to the ongoing remediation effort. A contract modification to increase the maximum quantity of services the government may order is appropriate to maintain continuous operations and not incur delays that could interfere with program goals.

The environmental remediation services at DFSP Point Loma require continuous 24 hour /7 days a week operation and are highly specialized. An early termination of the current contract and re-compete that could result in award to a new contractor would require the new contractor to make a substantial investment in equipment and materials, including off-road vehicles, sufficient inventory of off-the-shelve and custom designed components and tools for maintenance of the remediation systems. The new contractor would need to setup NBPL hazardous waste disposal accounts, procure internet and phone services (e.g. a monitored 800 number for emergencies), and obtain/update permits that reflect the company change. The offerors’ pricing would take all of these costs into account. Contract termination fees for the current contract with Bhate may also be applicable of which DLA Energy would be obligated to pay per FAR 52.212-4(l). The cost to re-procure the environmental remediation services would present a substantial increase or duplication of cost to the Government that is not expected to be recovered through competition.

3. Description of supplies or services required to meet the agency’s need (including estimated value) (FAR 6.303-2(b)(3)):

This contract was competed between small business concerns (100% set-aside) and awarded to Bhate on May 1, 2023. No options under this contract have been exercised. The awarded dollar value of the current contract is .

In order to meet the mission at NBPL, it is critical that the environmental remediation services at DFSP Point Loma, CA not be interrupted. Within the scope of this contract, Bhate is responsible to provide all materials, labor, & services to perform the following commercial services:

1) Under CLIN 0001

- Public Relations

- Project Management Review Meetings

- Regulatory Agency Meetings

- Remediation

- Groundwater Monitoring, Analysis, and Reporting

- Analytical Testing

- Environmental Management System

- Hazardous Material Business Emergency Plan

- Hazardous Waste

- Natural and Cultural Resource Support

- Pest Management Support and Herbicide Management

- Spill Response

- Wastewater support

- Storm Water Structures

2) Under CLIN 0002, Extraordinary Site Support is reserved for tasks that include, but are not limited to, sampling for or remediation of emerging contaminants, employing novel or innovative solutions for promoting cleanup objectives, responding to an unforeseeable incidental tasking (e.g. assess impacts to endangered species or management area), or conducting an assessment to third-party damages of a capitalized fuel pipeline or providing certain subject matter expertise to support DLA Energy’s environmental program objectives.

An estimated additional amount of is required to order required services, to include:

1. Well installation, sampling workplan and sampling/analysis plan;

2. Point Loma treatment system upgrade workplan addendum, treatment system computer upgrades, and flow meter replacements;

3. Treatment system remedial design workplan, soil boring installation and sampling, groundwater well/recovery well installation, and treatment system upgrades reporting at recovery well S-34;

4. Portable extraction unit operation and maintenance (LNAPL); and

5. Performance model update, facility groundwater monitoring plan up date, degradation piezometer well installation, granular activated carbon and organoclay treatment replacement vessels, paint treatment system canopy, and power jetting two trenches.

4. Identification of the statutory authority permitting other than full and open competition (FAR 6.303-2(b)(4)):

This J&A is based upon the authority of 10 U.S.C. §2304(c)(1), as implemented by Federal Acquisition Regulation (FAR) 6.302-1, and more specifically, the authority of FAR 6.302- 1(a)(2)(iii). The services sought are highly specialized and available only from the original source for this contract action. Award to a new source would likely result in substantial duplication of cost to the Government that is not expected to be recovered through competition and would result in unacceptable delays in fulfilling the agency’s requirements. A new remedial contractor may not have any expert knowledge of the geology of the site and expert understanding of the specific remedial equipment that is currently operating at the site. As an example, if a different contractor was selected to perform this remedial work now, schedule slippage due to transitioning and training would certainly cause unacceptable delays and would likely jeopardize project execution as this work is inherently tied to the remedial work currently being performed by Bhate (ex. For the work that involves treatment system upgrades, which is the bulk of this proposed FY24 work, the new contractor may not have any knowledge of how those remedial systems work, which would not be in DLA’s best interest for project execution, cost and schedule).

5. Demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited (FAR 6.303-2(b)(5)):

The services required by the agency may be deemed to be only available from the original sources for the continued provision of highly specialized services in accordance with FAR 6.302- 1(a)(2)(iii).

Bhate is uniquely qualified to perform the environmental restoration services at NBPL as they have been providing continuous support under the current contract and were in joint venture under the previous DLA Energy environmental restoration contract at DFSP Point Loma.

Bhate’s existing work force is trained and capable of conducting operations without interruption.

DFSP Point Loma being located on a secure Naval Base with sensitive military operations, contractor personnel working on NBPL must be vetted and cleared. Key personnel must possess a Common Access Card (CAC). Bhate’s personnel have been vetted and have the proper identification to access NBPL. Bhate personnel have understanding and experience with the processes, procedures, and standards at NBPL as well as established relationships with key NBPL points of contact.

Bhate’s performance rating under the current contract at DFSP Point Loma, CA is Very Good based on COR Reports in DOD’s Surveillance and Performance Monitoring system.

Additionally, Bhate currently possesses the vehicles, equipment, and personnel to sustain the services during the remaining three years of the period of performance in accordance with the current contract SPE603-23-D-5002. A new contractor would need preparation time prior to beginning performance to acquire the necessary specialized trucks to perform the contract and to develop and implement operations and training plans and to train personnel.

Terminating this contract and resoliciting utilizing full and open competition for this requirement is not in the best interest of the Government. In accordance with FAR 6.302-1(a)(2)(iii), an attempt to resolicit this requirement through full and open competition would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and would result in unacceptable delays in fulfilling the agency’s requirements as addressed in Section 2 above. Substantial logistical and financial burdens required of a contractor to perform this requirement, past experience of low bids, and the market research results listed in Section 8 of this document shows that few, if any, contractors would be interested in fulfilling this requirement. The procurement conducted in 2022 through 2023 to award the current contract resulted in two offerors. Companies that may be interested, would likely propose contract prices that are much higher than the current contract in order to recover start-up costs over a shorter period of time. Therefore, the cost of conducting a solicitation for this requirement is unlikely to be recovered through competition. The Contracting Officer has determined that modifying the current contract to increase the maximum quantity of services the government may order will ensure the continued and uninterrupted support of the environmental restoration mission at DFSP Point Loma through the end of performance period.

6. Description of the efforts made to ensure that offers are/were solicited from as many potential sources as is/was practicable, including whether a notice was or will be publicized as required by Subpart 5.2 and, if not, which exception under 5.202 applies (FAR 6.303- 2(b)(6)):

In accordance with FAR 6.305(a), a J&A special notice will be posted to the SAM.Gov website synopsizing the proposed increase to the maximum services the government may order price. A competitive action is not practicable to meet the immediate needs of the following five task orders:

1. Well installation, sampling workplan and sampling/analysis plan;

2. Point Loma treatment system upgrade workplan addendum, treatment system computer upgrades, and flow meter replacements;

3. Treatment system remedial design workplan, soil boring installation and sampling, groundwater well/recovery well installation, and treatment system upgrades reporting at recovery well S-34;

4. Portable extraction unit operation and maintenance (LNAPL); and

5. Performance model update, facility groundwater monitoring plan update, degradation piezometer well installation, granular activated carbon and organoclay treatment replacement vessels, paint treatment system canopy, and power jetting two trenches.

7. Determination by the contracting officer that the anticipated cost to the Government will be fair and reasonable (FAR 6.303-2(b)(7)):

Contract prices, to include prices established in Attachment 2 of contract SPE603-23-D-5002, were negotiated and determined fair and reasonable IAW FAR 15.404-1(b)(2)(i). The Contracting Officer determines that the anticipated cost for additional extraordinary site support services under CLIN 0002 will be comprised of pricing from Attachment 2 and potentially additional quantities of services the government order or supplies not found in Attachment 2. The additional quantities of services the government may order and supplies that may be required and are not established in Attachment 2 may be determined fair and reasonable based on a combination of FAR 15.404-1(b)(2)(ii) – (vii) and a price analysis that will be conducted on a case by case basis for each task order. The requirements for the upcoming five task orders were quantified and documented in the Independent Government Cost Estimate (IGCE) for .

8. Description of the market research conducted and the results or a statement of the reason market research was not conducted (FAR 6.303-2(b)(8)):

While market research was conducted for the initial procurement that resulted in award of contract SPE603-23-D-5002, market research was not conducted for this action to increase the maximum quantity of services the government may order because the additional requirements are intertwined with the existing contract actions and it would be unsustainable to have two contractors working at the same site on projects that require overlap and tight coordination. Also, the procurement for the current contract was conducted relatively recently and thus, the circumstances of the most recent procurement were considered, to include interested companies, number of companies attending the preproposal conference, number of competitive proposals received, and prices proposed. Only 2 offerors submitted proposals on the current contract, which suggests that the pool of providers capable of delivering these highly specialized services is limited. Among the offerors, only Bhate possesses the requisite expertise in site knowledge, project management, and regulatory interaction to successfully execute the contract. A new contractor may lack essential expertise in the site’s geology and may not be familiar with the specific remedial equipment currently in operation at the site.

9. Any other facts supporting the use of other than full and open competition, such as (FAR 6.303-2(b)(9)):

(i) Explanation of why technical data packages, specifications, engineering descriptions, statements of work, or purchase descriptions suitable for full and open competition have not been developed or are not available.

N/A

(ii) When 6.302-1 is cited for follow-on acquisitions as described in 6.302-1(a)(2)(ii), an estimate of the cost to the Government that would be duplicated and how the estimate was derived.

(iii) When 6.302-2 is cited, estimated cost, or other rationale as to the extent and nature of the harm to the Government.

10. A listing of the sources, if any, that expressed, in writing, an interest in the acquisition (FAR 6.303-2(b)(10)):

DLA Energy FESDA has not received communication from sources interested in this acquisition.

11. Actions that may be taken to remove or overcome barriers to competition before any subsequent acquisition for the supplies or services are required (FAR 6.303-2(b)(11)):

Increasing the maximum quantity of services the government may order to the contract will not create barriers to future competition at DFSP Point Loma. The Government has procured these services competitively in the past and intends to do so for the follow-on contract in 2027.

I hereby certify that the data which forms the basis for this justification is accurate and complete to the best of my knowledge and belief.

Contract Specialist Date:

I hereby certify that the data which forms the basis for this justification is accurate and complete and that the purchase request covers only the minimum requirements to satisfy the needs of the Government.

Navy/Marine Corps Team - Environmental Branch Chief Facility Sustainment Directorate Defense Logistics Agency Energy

Approved:

Contracting Officer