JA RFAAP Increase Ceiling signed 13 Dec 2021 - Redacted.pdf

CUI

Control No: 21-032 initial ten years, which necessitates this ceiling increase, was contemplated in the Acquisition Plan; as such, an amendment to the acquisition plan is not necessary.

c. On 17 May 2011, BAE OSI was competitively selected for operation of RFAAP.

BAE OSI was awarded three companion contracts as a result of the competition:

1) Contract Number W52P1J-11-C-0012, a FFP, zero dollar, facilities use contract for the operation and maintenance tasks required at RFAAP, which included a five-year base and a five-year option that was exercised at the time of award.

2) Contract Number W52P1J-11-D-0013, a five-year FFP IDIQ contract for the production of NC, propellant, and rocket grains with a maximum contract value of $423,000,000.00.

3) Contract Number W52P1J-11-G-0002, a five-year Basic Ordering

Agreement (BOA) for direct-funded modernization projects issued under task orders.

As expressly noted in the facilities use contract, it was awarded as a “zero dollar” contract and BAE OSI was required to perform the indirect services at no cost to the Army (i.e. not separately funded), and as consideration, BAE OSI (as the operator) would receive revenues through the companion IDIQ contract, orders issued under the BOA for modernization projects and direct services, along with third party sales. Both the IDIQ production contract and the facilities use contract acknowledged that the cost of performance of indirect Performance Work Statements would be amortized into the price of products contained in the FFP IDIQ contract and any other production contracts that are awarded for performance at Radford. The IDIQ production contract provided a list of propellant products that were considered the base workload for production at RFAPP, but it did not expressly limit production orders to only those listed products. It also noted that BAE OSI may be required in future years to maintain a particular surge capacity level.

24 January 2012 subsequently became the contract start date for all three contracts after two post-award protests were successfully resolved. The initially-awarded period of performance for the facilities use contract (the base and the five-year option) runs through 23 January 2022. The initial period of performance for the BOA was modified in 2016 to extend the ordering period through 23 January 2022, for consistency with the facilities use contract.

The initial period of performance for the IDIQ production contract was extended in 2015 via a contract modification supported by Justification and Approval (J&A) 15- 178; it was extended to 31 July 2018. The authority cited in that J&A was 10 U.S.C. 2304(c)(3), as implemented by FAR 6.302-3, “Industrial Mobilization,” the same as in this J&A. Under that authority, full and open competition need not be provided for when it is necessary to award the contract to a particular source in order to keep vital facilities or suppliers in business or make them available in the

JS and accounts for anticipated customer requirements, which are based on Procurement Appropriation funding, FMS, and supplemental funding, as well as surge capacities that are intended to align with RFAAP production capabilities and are necessary in order to support customer requirements in the event of a national emergency. The increase in value will cover the contract through January 2027.

ACC-RI has issued a request for proposal to BAE OSI for production requirements through January 2027. Subsequent to the completion of negotiations, ACC-RI will extend the period of performance on the production contract through January 2027.

Contract provisions also provide for the potential achievement of two subsequent award terms beyond this initial five-year extension.

2026 totals are inclusive of any potential January 2027 orders.

4. Authority Cited: 10 U.S.C. 2304(c)(3), as implemented by FAR 6.302-3, “Industrial mobilization; engineering, developmental, or research capability; or expert services.”

More specifically, FAR 6.302-3(a)(2) provides that “Full and open competition need not be provided for when it is necessary to award the contract to a particular source or sources in order – (i) To maintain a facility, producer, manufacturer, or other supplier available for furnishing supplies or services in case of a national emergency or to achieve industrial mobilization.”

5. Reason for Authority Cited:

a. As described in FAR 6.302-3(b)(1)(i), use of the exception to full and open competition provided for in FAR 6.302-3 (a)(2)(i) is appropriate when it is necessary to award the contract to a particular source in order to keep vital facilities available in the event of a national emergency. Furthermore, as provided for in FAR 6.302-3(b)(1)(v), use of that exception to full and open competition is also appropriate when it is necessary to continue in production a contractor that is manufacturing critical items, where there would otherwise be a break in production.

b. The Defense Industrial Reserve Act requires the Department of Defense (DoD) to maintain a nucleus of Government-owned plants and equipment and to maintain an industrial reserve of equipment for emergencies (10 U.S.C. 2535 Defense Industrial Reserve). The Army, as the Single Manager for Conventional Ammunition (SMCA) under Section 806 of the National Defense Authorization Act for Fiscal Year 1999, Public Law No. 105-261, as delegated from the Department of Defense to the Secretary of the Army (SECARMY) by Department of Defense Directive 5160.65, Single Manager for Conventional Ammunition (SMCA), is responsible for ensuring there are critical industrial capabilities to meet current

Product 2022 2023 2024 2025 2026 Total Solvent Solventless

NC

Rocket Motor Total

Total Contract Value ($)

Subcontracting, which states that the contractor shall select subcontractors on a competitive basis to the maximum practicable extent.

7. Actions to Increase Competition: For the reasons discussed in paragraph 5, competition is not being sought for this requirement. However, prior to the expiration of the BAE OSI contracts, a follow-on contract will be competed to the maximum extent.

8. Market Research: A significant amount of market research was conducted in accordance with FAR 10.002 Market Research, prior to a competitive award of the facilities contract and its companion BOA and FFP IDIQ contract in 2011. Additionally, a sources sought announcement was published to the Federal Business Opportunities website on 28 June 2019 to identify additional sources. An industry day was also conducted on 29-30 October 2019 for the RFAAP requirement. This market research performed in FY19 was utilized to help craft the Government’s decision to either extend via an award term option or re-compete. On 09 July 2020, JPEO AA determined that it is imperative and required to maintain BAE OSI as the operator and manufacturer at RFAAP. On 16 July 2021, after continuous market research assessment of the conditions regarding the extension, JPEO AA reaffirmed this decision.

9. Interested Sources: Other sources have expressed interest in the operation and maintenance of RFAAP; however, for the reasons identified in paragraph 5, a competition is not appropriate at this time. Prior to expiration of the Facility Use contract, BOA, and the FFP IDIQ contracts, either at the end of the impending award term extension period or a subsequent award term extension under the Facility Use contract, a competition will be conducted to execute a new contract for the operation and maintenance of RFAAP, and other interested parties will have the opportunity to submit proposals at that time.

10. Other Facts:

a. Procurement History:

Contract: W52P1J-11-D-0013, P00016, Ceiling increase Contractor: BAE OSI Award Date: 28 July 2020 Competitive Status: Not competed, J&A 20-035 Authority: FAR 6.302-3

Contract: W52P1J-11-D-0013, P00010, Realign POP after protest resolution Contractor: BAE OSI Award Date: 29 September 2015 Competitive Status: Not competed, J&A 15-178 Authority: FAR 6.302-3

Contract: W52P1J-11-D-0013, Propellants Contractor: BAE OSI Award Date: 17 May 2011 Period of Performance: Through 23 January 2022 Competitive Status: Full and Open Competition

BOA: W52P1J-11-G-0002, Modernization Contractor: BAE OSI Award Date: 17 May 2011 Period of Performance: Through 23 January 2022 Competitive Status: Full and Open Competition

Contract: W52P1J-11-C-0012 Contractor: BAE OSI Award Date: 17 May 2011 Period of Performance: Through 23 January 2022 Competitive Status: Full and Open Competition

Contract: DAAA09-09-G-0002 Contractor: ATK Award Date: 13 July 2009 Competitive Status: Sole Source to ATK, J&A CM 001-032 Authority: FAR 6.302-3

b. Acquisition data availability: N/A

c. Unusual and compelling urgency: N/A