JA SSP No 18045_Redacted_Final.pdf

J&A NO sp. 18,045 Code: SPN301

JUSTIFICATION AND APPROVAL (J&A)

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

1. CONTRACTING ACTIVITY. Department of the Navy’s Strategic Systems Programs Office (SSP) located at the Washington Navy Yard, 1250 10th Street SE, Washington, D.C. 20374

2. DESCRIPTION OF THE ACTION BEING APPROVED. This Justification and Approval seeks the approval to negotiate and award a Fiscal Year (FY) 2021 TRIDENT II (D5) Strategic Weapon System (SWS) SSP Shipboard System Integration (SSI) Navigation (NAV) Subsystem Production effort by using other than full and open competition. The contractor is Lockheed Martin Rotary and Mission Systems (LMRMS) located in Mitchel Field, NY. The contract will consist of one (1) base year and seven (7) option year periods to provide production and delivery of SSI Increment 8 Inertial Navigation Systems (INSs) and associated spares for the OHIO, VANGUARD, COLUMBIA, and DREADNOUGHT SSBN SWS platforms for the Fleet Ballistic Missile (FBM) Program.

3. DESCRIPTION OF SUPPLIES/SERVICES.

a. This contract will provide SSP with the required U.S. and UK Navigation hardware deliverables, and supporting spares, for the SWS INS production efforts associated with the OHIO, VANGUARD, the impending COLUMBIA, and DREADNOUGHT SSBN platforms, along with support for the functional and performance factory acceptance testing, sell-off, packaging and storage of the INS units prior to install. The contract is expected to include a base award with seven (7) option years. The base contract is expected to be awarded in Dec of 2020 and contain a 12-month Period of Performance with seven option years, each containing a 12-month Period of Performance. The contract is expected to end in Dec of 2028.

b. This contract provides SSP with SWS Navigation Subsystem performance improvements associated with the SSI Program and reduces risks due to: 1) the homogeneity of material purchases; 2) reduced need of SSP Ship Alterations (SPALTs); 3) reduced re-qualification of hardware when compared to mutli-decade production runs; 4) minimizes obsolescence/Diminishing Manufacturing Sources (DMS) concerns during the production cycle;

5) provides significant Economic Order of Quantity (EOQ) savings; 6) sustains workforce by achieving steady-state unit quantities per year (optimization of supporting labor, e.g. non-touch, DEPARTMENT OF THE NAVY

STRATEGIC SYSTEMS PROGRAMS

1250 10th Street SE, Suite 3600

Washington Navy Yard, DC 20374-5127 workforce); 7) provides significant savings by amortizing fixed facility expenses across greater quantities, annually; and, 8) ends the production run significantly sooner than current Program of Record (POR) timelines, therefore eliminating need for significant resources in the out-years.

c. The following table delineates the estimated contract value, by appropriation and includes the value of all options.

Then Year ($)

Appn FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 Total

OP,N $31,764,778 $37,219,165 $39,463,343 $0 $0 $0 $0 $0 $108,447,286

SC,N $8,706,853 $0 $0 $15,842,799 $3,197,025 $7,108,074 $24,865,428 $24,949,440 $84,669,618

U.S. Total $40,471,631 $37,219,165 $39,463,343 $15,842,799 $3,197,025 $7,108,074 $24,865,428 $24,949,440 $193,116,904

In accordance with 10 U.S. C 2304 (f)(2)(E), the United Kingdom FY 2018 POLARIS/TRIDENT II Procurement Memo, and the Jan 1986 UK Memo, identifies UK funding as non-appropriated and not requiring J&A approval.

4. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION. 10 U.S.C. 2304(c)(1). Only one responsible source and no other supplies or services will satisfy agency requirements.

5. RATIONALE JUSTIFYING USE OF CITED STATUTORY AUTHORITY.

a. Lockheed Martin Rotary and Mission Systems (LMRMS) designed, developed, installed, and supported each of the FBM SWS Navigation Subsystems on all existing U.S. OHIO and UK VANGUARD submarines. LMRMS (and major subcontractor) possess and/or operate specialized facilities, such as the Ashore Navigation Center, the Inertial System Test Lab, the Navigation suite onboard the USNS WATERS, software development laboratories, and other program-related TOP SECRET facilities. These unique facilities are crucial for the continued system evaluation, problem investigation, and resolution as they can duplicate and simulate events experienced in the Fleet. Additionally, LMRMS designed and manufactured the specialized test equipment and simulators located at each of the aforementioned laboratory facilities which are used by LMRMS subject matter experts (SMEs) to gain insight into performance issues encountered during production. These facilities are also used to perform formal acceptance of SWS mission hardware.

b. SSP estimates it would require approximately four years, at a cost estimated at nearly $150M to establish another source to perform the functions provided by LMRMS and to duplicate the facilities currently in place to produce the INSs. Such an enterprise would require the development and certification of duplicate facilities as well as educating and training another workforce. Developing duplicate test facilities, while also maintaining existing facilities, would include the following:

(1) Development and delivery of special tooling and test equipment; qualifying the navigation equipment design, production, and recertification processes via rigorous test and inspections;

(2) Preparation of detailed program plans to include production, maintenance, training, logistics, and support of existing Trident II facilities;

(3) Preparation of documentation for shipboard installation and test, and the operation, maintenance, and provisioning of the navigation subsystem onboard existing U.S. OHIO and UK VANGUARD submarines;

(4) Additional Costs for engineering and sustainment.

c. Presently, LMRMS is the sole source provider for engineering personnel with the highly-specialized knowledge of the design requirements, concepts, operations, and maintenance of the SWS Navigation Subsystem. The knowledge and expertise among the LMRMS workforce has been cultivated over years of experience and through the continued evolution of the SWS Navigation Subsystem.

d. To assume the LMRMS effort, alternate sources would have to duplicate the LMRMS facilities; receive, install, and set into operation the above mentioned test and engineering evaluation equipment; generate in-plant documentation implementing government and LMRMS provided higher level documentation; and establish SSP engineering, quality, production and reliability systems. Government support of this initial effort would cost in excess of $20M.

These expenditures would be required for properly conducting the test and engineering evaluation; generate in-plant implementation documentation; and the relocation and installation of test and engineering evaluation equipment at the new source, transfer of and/or development of existing engineering and production skills, and coordination with existing Navigation industrial support contractors. The effort would require a minimum of 2 years from the date of contract award, to start of the new source. The effort to achieve the current level of Navigation subsystem skillsets by another organization would be substantial. LMRMS is currently the lead system integrator of the SSI Increment 8 INS configurations, performing the majority of the ongoing hardware and software design management, in addition to the integration of the SSI Increment 8 technology items into the full Navigation subsystem configuration. Gyro and INS production began in FY2017 in order to meet critical program milestones for SSI Increment 8.

SSP estimated that the effort required for a new contractor to assume the role of lead system integrator for production of the SSI Increment 8 efforts in FY2019 would have also required approximately 2 additional years and in excess of $25M, a substantial and irrecoverable duplication of costs, and an unacceptable slip to the SSI schedule that would have caused SSP to fail to provide the U.S. and UK Fleets with a serviceable replacement to the electro-static gyro navigator (ESGN). Current ESGN sustainment efforts are not capable of filling the gap created by a 2-year slip to the SSI Increment 8 INS schedule without significant risk to the SWS mission.

Delays to the SSI Increment 8 (OHIO and VANGUARD), COLUMBIA, and DREADNOUGHT schedules, whether due to in-service sustainment, development, or delivery requirements for the next-generation platforms, will ultimately impact SSP’s ability to meet the SWS requirements of the U.S. and UK Fleet. These delays would require Ballistic Missile submarines in the U.S. and UK Fleet to be out of service for extended, unscheduled time periods which would adversely impact Fleet readiness.

e. In addition to the above analysis of start-up cost to duplicate the capabilities already obtained by LMRMS along with the loss of time that would be required to build such capabilities to the current level of LMRMS’ capabilities, there is an actual cost savings of over $25 million over the life of the production. The proposed procurement allows for LMRMS to build the INS during the first four-to-five years of the contract and store the INSs until such time that the Government requires the INSs for installation to new ships, or when funding is available. The “buy at time of need / funds available” options under this contract maximizes the learning curve and building efficiencies LMRMS develops and ensures INSs are ready when the Government is ready while reducing production cost significantly. The table below shows the cost savings.

Price $M ($TY) is:

INS Spares Byproducts savings from acceleration

Original 'build and buy' $216 $57 $273

Accelerated plan: $171 $52 $25 $248

Total delta (saving): $45 $5 -$25 $25

f. For reasons stated above, SSP considers LMRMS to be the only known source available with the essential background of design, knowledge, and operational experience relative to the SWS Navigation Subsystem to provide the quality and timeliness of required production services without undue technical risk. No other source could provide these services within the lead time proposed for this procurement. In attempting to develop another source, the Government would encounter substantial duplication of cost that is not likely to be recovered through competition.

Procuring these services from an alternative source would present an unacceptable technical, schedule, and cost risk to the SWS Navigation Subsystem program. Furthermore, the cost savings to the Government, which exceeds $25M, cannot be obtained through any other procurement strategy or with any other vendor. The SSP Navigation Branch (SP24) certifies this recommendation is based on accurate and complete data.

6. DESCRIPTION OF EFFORTS MADE TO SOLICIT OFFERS FROM AS MANY

OFFERORS AS PRACTICABLE.

a. A Sources Sought Notice (SSN) was released on N0003019C0045, with identical work scope for Inertial INS and Spare production as a subset, seeking potential interested sources. No sources responded to this notice with any capability statements meeting the requirements of the posted draft Statement of Work (SOW). Another Sources Sought Notice was released on 28 October 2019 under SSN number N0003021Q0015 and received no responses. However, LMRMS acknowledged the Sources SSN during a Program Review on 14 November 2019.

LMRMS verbally informed SP24 personnel that LMRMS leadership decided not to invest resources in building a capabilities package as a response to the SSN, since they are the current incumbent.

b. Given the complexity of the efforts being procured, (i.e. specialized engineering support of U.S. TRIDENT II weapon systems and research in the application of technologies to support TRIDENT II (D5) Guidance and Reentry Systems), SSP’s past experience procuring the same or similar efforts, and the extensive knowledge of SSP’s technical personnel regarding all sources for the efforts, including commercial sources, market research was limited to a high level, informal analysis by SSP technical personnel. Analysis included review of the Air Force facilities: Boeing, Newark Ohio; Northrop, Hawthorne CA; BAE, Silver Springs MD and NASA, Houston TX. This examination emphasized the unique nature of the TRIDENT II (D5) missile subsystem, thus underscoring the reliance on our current source.

c. Other strategic market research has been an ongoing effort by surveying non-inertial Navigation System technologies and systems. The SP24 engineers actively monitor relevant DoD activities in this area of precision navigation development. At this time, the strategic market research confirms that it is not practical, for the reasons discussed in paragraph 5 above, for any company other than LMRMS to provide the required services and supplies in this contract given the complexity of the efforts being procured in this highly specialized and unique submerged inertial navigation subsystem requirements.

d. The conclusion derived from all market research is to continue with the current prime contractor. Change from the current prime contractor would result in significant programmatic impacts regardless of the new source selected.

7. DETERMINATION OF FAIR AND REASONABLE COST. By using such tools as the SSP technical analysis, the Defense Contract Audit Agency (DCAA) audit reports, Defense Contract Management Agency (DCMA) Pricing report, and SSP cost and price analysis from previous contract, including the use of actual costs on SSP Contracts N0003017C0045, N0003018C0045, and N0003019C0045 with LMRMS, the Contracting Officer has determined that the anticipated cost to the Government of the supplies and services covered by this J&A will be fair and reasonable.

8. ACTIONS TO REMOVE BARRIERS TO FUTURE COMPETITION. Due to the substantial duplication of cost an unnecessary delay that would result from assigning this effort to a contractor other than LMRMS, SSP does not have plans at this time to compete future contracts for the types of supplies/services covered by this document. If another potential source emerges, as discovered through the continual tactical and strategic market research processes, sources sought notices, and synopses, SSP will assess whether competition for future requirements is feasible. Furthermore, SSP is exploring other navigation solutions for feasibility in support of the SWS Navigation requirements such as the Multi-Star Enhanced Prelaunch (MEP) and the

Navy’s WSN-12 Inertial Sensor Module which may provide for competition, alternative procurement strategy in the area of inertial navigation solutions in the future.

GEURTS.JAME

S.F.1034185286

Digitally signed by

GEURTS.JAMES.F.1034185286

Date: 2020.06.17 08:11:16 -04'00' 17 Jun 2020