JA_SPRDL120R0105_Redacted_Final.pdf

Justification & Approval: SPRDL1-20-R-0105 (Previous J&A SPRDL1-17-R-0564 provided separately)

DEFENSE LOGISTICS AGENCY

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

1. Contracting Activity: The Contracting Activity for this action is the Defense Logistics Agency – Land Warren (DLA Land Warren).

2. Description of Action: The proposed contract action is for the purchase of a quantity of 12 each Falex 400 Fuel Thermal Oxidation Tester (herein referred to as Thermal Oxidation Tester) for the Petroleum Quality Analysis System – Enhanced (PQAS-E). The PQAS-E is a mobile testing lab for determining fuel quality in theatre in accordance with modified level B standard per MIL-STD-3004, ASTM International and ISO standards. The PQAS-E increases the testing capabilities to ensure the quality of fuel that is received, stored, and issued from commercial, military, and/or captured enemy stocks throughout the theater of operation. This procurement will be restricted to Compass Instruments, Inc. (CAGE: 43AS7), as this firm is the only responsible source for this item, and no other supplies can successfully satisfy agency requirements. This action will be funded using Army Working Capital Funds (AWCF).

3. Description of Supplies/Services: The proposed contract action is to procure a quantity of 12 each Thermal Oxidation Tester units (National Stock Number (NSN) 6630-01-564-5517) from Compass Instruments, Inc., part number 400-001-001, with an option to purchase a quantity of 12 each. The estimated unit value is , for an estimated total contract value of . Pertinent details regarding the proposed acquisition are listed below.

Acquisition Method Code (AMC): 3 – Acquire, for the second or subsequent time, directly from the actual manufacturer.

Acquisition Method Suffix Code (AMSC): R – The Government does not own the data or the rights to the data needed to purchase this part from additional sources. It has been determined to be uneconomical to buy the data or rights to the data. It is uneconomical to reverse engineer the part. This code is used when the Government did not initially purchase the data and/or rights. If only one source has the rights or data to manufacture this item, AMCs 3, 4, or 5 are valid. If two or more sources have the rights or data to manufacture this item, AMCs 1 or 2 are valid.

4. Authority Cited: The statutory authority permitting other than full and open competition is 10 USC 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. Reason for Authority Cited: The U.S. Government does not own or have rights to the technical data for this item, as the Thermal Oxidation Tester was developed and tested at private expense; as a result, the technical data is considered proprietary to the manufacturer. The Government did not fund any efforts in developing or testing this item, nor did the Government fund any efforts to prepare a fully detailed technical data package (TDP) after approval. Compass Instruments is the sole source owner of the drawing package and technical data rights. The lack of such data requires the Thermal Oxidation Tester to be procured on a non-competitive basis from the current manufacturer for all replenishment acquisitions.

Procurement by other than full and open competition is necessary because Compass Instruments’ Thermal Oxidation Tester is the only source that has been used with the PQAS-E and is needed to insure standardization of equipment, test procedures, training, spare parts, and manuals with the PQAS-E. This Compass Instruments item is the only approved item for these systems. Due to the specific dimensions of the interior of the PQAS-E, the only suitable X-ray analyzer available is the Compass Instruments model. The mounting brackets and trays have been specifically designed for the Compass Instruments’ Thermal Oxidation Tester and will not work with any other models. Furthermore, counter space is also conserved due to the small size of the instrument which allows for it to be mounted on the countertop. If a new instrument were used, these benefits would potentially be lost. Lastly, the Technical Manual (TM) has been written specifically for this instrument. If a new instrument were to be used, it would be very costly and time consuming to update the TM to reflect the new operating procedures.

6. Efforts to Obtain Competition: The Government does not own a fully detailed TDP required to manufacture this item. There are no vendors in the process of being qualified at this time, nor will be prior to the contract award due to funding constraints.

There are no planned efforts to qualify additional sources due to the fact that that there is no technical data available to produce a competitive TDP, nor are there any funds available to conduct the extensive (costly and time consuming) qualification testing requirements. The estimated time to reverse engineer the Thermal Oxidation Tester is three years at a cost of approximately $2M.

This would have a negative impact on the PQAS-E program as those funds are not available, and the timeline is not acceptable. Army units with a PQAS-E that need a new Thermal Oxidation Tester would not be fully mission capable until the reverse engineering effort was completed, and then a contractor was selected to produce the instrument. The estimated cost of purchasing the TDP from Compass Instruments, Inc.

is $12M.

Testing and validation of any claims would need to be verified before source approval is granted. It is estimated to take 18 months and an additional $2M to fully test and validate a new instrument in the PQAS-E. Reverse engineering, testing, and all other efforts to become a secondary approved source would be at the contractor’s expense.

Therefore, this action will only be limited to Compass Instruments, the owner of the intellectual property and manufacturer of the Thermal Oxidation Tester.

7. Actions to Increase Competition: There are no known funding efforts in progress at this time to develop the competitive technical data required needed to make the Thermal Oxidation Tester fully competitive.

No contractors are in the process of being qualified at this time, nor will be prior to the contract award due to funding constraints. Currently, there has not been any expressed interest by any known vendor(s) to become qualified source(s) to produce this item.

Any new vendor who decides to pursue the qualification process will be directed to the Competition Advocate’s Source Approval Program (SAP). The Competition Management Office (CMO) would encourage interested parties to submit a Source Approval Request (SAR) at this time for future buys.

8. Market Research: Market research was conducted by

. The research included reviewing online catalogs (websites) published by manufacturers of instruments certified by ASTM D3241 (Standard Specification for Aviation Turbine Fuel) to see if they offered an equivalent instrument to the Thermal Oxidation Tester. No instruments were found that would be suitable for this application due to differences in size, operation, lack of detailed work instructions, and different spare parts and maintenance procedures. This market research was conducted from 9 September 2019 through 20 September 2019.

The results of this search did not produce any new information on any company that could provide a replacement for the Thermal Oxidation Tester. No detailed technical data is available for the Thermal Oxidation Tester, and market research results are very limited.

Websites Reviewed:

http://www.paclp.com/lab-instruments/brand/alcor/product/13/jftot-iv-jet-fuel-thermal-oxidation-tester http://www.meteo-tech.co.il/ImagesDownloadFiles/DownloadFile1727 1 %D7%91%D7%A8%D7%95%D 7%A9%D7%95%D7%A8.pdf

WebFLIS - Market Research.pdf

A Sources Sought Notice was posted on 01 October 2019 (see below). To date, no other sources have expressed an interest in providing the subject item. Any interested source will be directed to the Source Approval Program though the competition advocate’s office for information on becoming a qualified source of supply.

Sources Sought Notice#: 2020-004 Component: Thermal Oxidation Tester

NSN: 6630-01-564-5517

Part Number: 400-001-001 End Item: Petroleum Quality Analysis System (PQAS-E)

Sources Sought Notice 2020-004:

https://www.fbo.gov/index?s=opportunity&mode=form&id=4cd0513111776dc6ba031d0ec6 b36736&tab=core& cview=0

9. Interested Sources: There has not been any expressed interest by any known contractors to become a qualified source to produce the Titrator item. The notices required by FAR 5.201 will be published, and any bids or proposals received will be referred to the applicable engineering office for analysis and will be considered.

10. Other Facts:

(1) Procurement History:

Contract: SPRDL1-18-C-0218, awarded on 04 April 2018 to Compass Instruments, Inc. for a quantity of 28 each Thermal Oxidation Tester units with a total dollar value of $2,097,200.00. The J&A document for this procurement action is attached below.

Contract: SPRDL1-17-C-0203, awarded on 31 May 2017 to Compass Instruments, Inc. for a quantity of 10 each Thermal Oxidation Tester units with a total dollar value of $749,000.00.

(2) The above buys were solicited and awarded under Other Than Full and Open Competition.

(3) FAR 6.302-1, Only One Responsible Source was utilized

(4) Acquisition Data Availability: The Government does not own or have rights to the technical data for the Titrator NSN for this procurement.

(5) Unusual and Compelling Urgency: N/A

11. Technical Certification: I certify that the supporting data under my cognizance which are included in the justification are accurate and complete to the best of my knowledge and belief.

Name:

Title: PQAS-E Systems Engineer Date: 01 OCT 2019 Signature:

Name:

Title: Team Leader, Petroleum Storage and Distribution Date: 1OCT19 Signature:

Name:

Title: Associate Director FPT Date: 7OCT19 Signature:

12. Requirements Certification: I certify that the supporting data under my cognizance which are included in the justification are accurate and complete to the best of my knowledge and belief.

Name:

Title: Item Manager Date: 04 DEC 2019 Signature:

Name:

Title: PAWS Group Leader Date: 04 DEC 2019 Signature:

Name:

Title: FP PSID Director Date: 08 Jan 2020 Signature:

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable.

Normal acquisition procedures will be followed to determine that the contract price is fair and reasonable. The appropriate forms of cost and/or price analysis will be utilized, and negotiations will be conducted if necessary.

Name: Timothy A. Nichols Title: Contracting Officer, ZGBC Date: 09 Mar 2020 Signature: //TAN//

14. Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief.

Name: Timothy A. Nichols Title: Contracting Officer, ZGBC

Date: 09 Mar 2020 Signature: //TAN//

15. Legal Concurrence:

Concur:

Date: 03/13/2020

Approval Authority for Acquisitions Equal to or Greater Than $700,000

APPROVAL OF JUSTIFICATION

FOR OTHER THAN FULL AND OPEN COMPETITION

Based on the foregoing Justification, I hereby approve the procurement of the following:

a. Noun: Tester, Thermal Oxidation

b. NSN: 6630-01-564-5517

c. Maximum Quantity: 24 each

d. Estimated Value:

This action will be awarded under other than full and open competition pursuant to the authority of 10 USC 2304(c)(1) and subject to the availability of funds. This approval is subject to the proviso that the property herein described has otherwise been authorized for acquisition

NAME: Mary E Shearer TITLE: DLA Land and Maritime Competition Advocate

SIGNATURE:

Date:

SHEARER.MARY.E.

1250702449

Digitally signed by

SHEARER.MARY.E.1250702449

Date: 2020.03.18 13:54:09 -04'00'