JA TA-FSR Follow-On PY24-26 (Signed 10.25.24) (002)_Redacted.pdf

Control Number: LTB-J&A24-1911

(Source Selection Information – See FAR 2.101 and 3.104-4)

JUSTIFICATION REVIEW DOCUMENT

FEDERAL ACQUISITION REGULATION (FAR) PART 6 JUSTIFICATION AND

APPROVAL FOR OTHER THAN FULL AND OPEN COMPETITION

Program/Equipment: Program Years (PY) 2024 through 2026 for Phased Array Tracking Radar to Intercept of Target (PATRIOT) Advanced Capability (PAC)-3 Technical Assistance Support for The United States (U.S.) and Foreign Military Sales

(FMS)

Authority: The statutory authority permitting other than full and open competition is Title 10 United States Code (U.S.C.) Section 3204(a)(1), as implemented by FAR 6.302-1(a)(2)(iii)(A) and (B) – “Only one responsible source and no other supplies or services will satisfy agency requirements.”

Amount:

Prepared by:

Contracting Officer:

Technical Representative:

Requirements:

JUSTIFICATION AND APPROVAL (J&A)

FOR OTHER THAN FULL AND OPEN COMPETITION – FAR Part 6

PHASED ARRAY TRACKING RADAR TO INTERCEPT ON TARGET (PATRIOT)

TECHNICAL ASSISTANCE

1. Contracting Activity: Department of the Army, Army Contracting Command - Redstone Arsenal (ACC-RSA), CCAM-LTB, Redstone Arsenal, Alabama 35898-5280.

2. Description of Action: The Short and Intermediate Effectors for Layered Defense (SHIELD) Project Office (PO) requests approval of a Justification and Approval (J&A) to award a sole source follow-on contract to provide PAC-3 Technical Assistance (TA) support for the United States (U.S.) Government and International Partners to Lockheed Martin Missiles and Fire Control (LMMFC), 5600 W Sand Lake Rd, Orlando, Florida 32819-8907, Commercial and Government Entity (CAGE) code 1Q1J8. The intent is to award a follow-on contract for a base year and two option years during Program Years (PYs) 2024 through 2026. It is anticipated that the contract award will consist of Firm- Fixed-Price (FFP) effort. The Government projects award for this action by

. The resulting contract actions will utilize Missile Procurement Appropriation (MIPA) and Foreign Military Sales (FMS) funds.

This justification includes current and potential FMS requirements, some of which have yet to be identified and some of which may be source directed. The FMS requirements for newly identified International partners will be for the same or related services requiring essentially identical justifications. This contract will provide FMS support to the following known non-source directed countries: . Relevant case information is shown in Table 1 below:

Table 1: Case Information Country Case Number

3. Description of Supplies/Services: This requirement is in support of the SHIELD PO mission to provide TA to the U.S. and FMS partners for the PAC-3 missile segment being fielded, which includes ground support equipment, trainer devices and associated hardware and software, and depot maintenance at the contractor’s facility. This proposed acquisition is for the procurement of all materials, equipment, labor and resources required for TA support by the

. This acquisition will provide for an estimated for the TA support for a total estimated dollar value of It is anticipated that this contract action will cover a period of 36 months (one base year and two option years) with a Period of Performance (PoP) starting on and broken out as follows: PY1

, PY2

and PY3 Tables 2 and 3 below identify the estimated labor hours and cost for the U.S. and FMS.

Table 2: Total Estimated Labor Hours U.S. and FMS for Non-Source Directed Countries by Program Year

PY1

2024/2025

PY2

2025/2026

PY3

2026/2027

Total Estimated

Labor Hours

Table 3:Total Estimated Labor Hours U.S. and FMS Countries

Requirement Estimated Man- Hours Country Estimated Dollar

Amount

PY 24

PY 24

PY 24

PY 24

Sub Total PY24

FY25

FY25

FY25

FY25

Sub Total FY25

FY26

FY26

FY26

FY26

Sub Total PY26

4. Authority Cited: The statutory authority permitting other than full and open competition is Title 10 U.S.C. Section 3204(a)(1), as implemented by FAR 6.302- 1(a)(2)(iii)(A) and (B), “Only one responsible source and no other supplies or services will satisfy agency requirements.”

5. Reason for Authority Cited: The proposed source for the Technical Assistance efforts is LMMFC, 5600 W Sand Lake Rd, Orlando, Florida, 32819, CAGE Code 1Q1J8.

LMMFC, as the developer and producer of the PAC-3 missiles, for both the Cost Reduction Initiative (CRI) and Missile Segment Enhancement (MSE) configurations with associated ground support equipment and initial spares, is the only source with the technical knowledge, technical expertise, production infrastructure, facilities, and ownership of the full Technical Data Package (TDP) to produce the PAC-3 CRI and PAC-3 MSE missiles and associated launcher equipment. The U.S. Government has taken, and currently does take, delivery (via data item requirements) of the product drawings and specifications. However, the U.S. Government does not possess the product drawings and specification with the necessary technical data rights, proprietary work instructions or corporate knowledge that is required to support a competitive procurement.

(a) As described at FAR 6.302-1(a)(2)(iii)(A) and (B), "For DoD, NASA, and the Coast Guard, services may be deemed to be available only from the original source in the case of follow-on contracts for the continued provision of highly specialized services when it is likely that award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition; or unacceptable delays in fulfilling the agency's requirements."

(b) The Federal Acquisition Streamlining Act of 1994 mandated performance specifications, commercial standards, and manufacturing best practices be used for defense systems instead of military specifications, standards and level three TDPs. This allowed contractors to maintain control of the drawings, which limited the U.S.

Government's technical data rights. The U.S. Government and LMMFC entered into a Special License Rights Agreement (SLRA) in , re-negotiated in with further revisions incorporated in pursuant to the Defense Federal Acquisition Regulation Supplement (DFARS) 227.7103-5(d). The agreement provides the U.S. Government unlimited rights to any technical data relating to an item, component, or process, as well as any computer software, developed exclusively at the U.S. Government's expense after provided that the technical data and computer software can be segregated from technical data and computer software existing prior to . While the U.S. Government continues to pursue greater technical rights, the U.S. Government does not have sufficient rights to the complete TDP to compete this requirement. The current SLRA does allow the U.S. Government to use all technical data and computer software included in the TDP for sustainment and depot maintenance purposes. The renegotiated SLRA essentially provides the U.S. Government with government purpose rights to existing technical documentation in depot support activities.

(c) Any documentation submitted by LMMFC with less than unlimited rights requires an assertion by the contractor to justify the restriction. The U.S. Government reviews these assertions and challenges the assertions pursuant to DFARS 252.227- 7019, "Validation Of Asserted Restrictions–Computer Software ( and DFARS 252.227-7037, "Validation Of Restrictive Markings On Technical Data )," if it is determined that the U.S. Government funded the development of a new item or the modification of the design of an existing item in part or in whole.

(d) The U.S. Government has been able to reduce the restrictive intellectual property markings by approximately 66 percent which increases the possibility of future opportunities within the organic industrial base. However, a substantial number of the documents included in the current TDP reflect restrictive intellectual property markings critical for TA requirements. Per the SLRA dated

, competition for the production, design, or redesign of the PAC-3 missile system is restricted to LMMFC. This severely limits the U.S. Government’s current ability to utilize full and open competition. Further, the U.S. Government has incurred a substantial investment, summarized in Table 4 below, in developing manufacturing processes and procedures, special tooling, special test equipment, special inspection equipment, and fixtures, which are located at LMMFC facilities. Any effort to develop another source would increase overall program cost and delay the program schedule, severely impacting the system’s readiness posture and would limit the Warfighter from performing the intended mission. Duplication of costs to the U.S. Government to develop another source, summarized in the Table 4 below per the Economic Analysis conducted by the SHIELD PO on are substantial, would not be cost effective, could not be accomplished without a major impact to the program, and are not likely to be recovered through competition.

Table 4: Duplication of Costs to the U.S. Government

Contract Number Effort Contract Value ($M)

(e) LMMFC has been unwilling to provide an estimate of the cost to acquire the technical data rights for PAC-3 post-production support. The cost estimate of to procure the TDP is the result of comparison to a rough order of magnitude provided by LMMFC to acquire similar intellectual property rights to the TDP for Guided Multiple Launch Rocket System (GMLRS), which is a much less complex weapon system. The U.S. Government is currently working with LMMFC to acquire additional government purpose rights for sustainment/maintenance of the PAC-3 missiles. In addition, due to the complexity of the PATRIOT System and the PAC-3 Missile Segment, a technical interface contract would be required between LMMFC and any potential new source for PAC-3 post-production efforts. The Engineering and Manufacturing Development (EMD), MSE Development, and Initial Production Facility Costs of per the U.S.

Government estimated invested costs in Table 4 would be an initial estimated cost for a new technical interface contract with a new source. These efforts, ranging from missile testing to missile recertification and repairs, will be adversely impacted if a contract is awarded to a source other than LMMFC. The duplicated costs described above are not expected to be recoverable through competition because there is no expected competition for this contract.

(f) Any effort to award the proposed contract action(s) to a source other than LMMFC would result in slippage of necessary PAC-3 missile system post-production support and severely impact system readiness. The FMS customers would also be affected by schedule slippages as the TA contract provides post-production support to FMS partners.

(g) According to an economic analysis conducted by SHIELD PO on

, it is estimated to take four to seven years to establish another source for a comparable missile system, which would delay post-production support, missile field testing, inspection, and stockpile reliability efforts beyond the required timeline. This schedule slippage would result in a delay in fielding and an unacceptable decrease in the operational readiness of U.S. and Allied Forces. The PAC-3 Field Surveillance Program and Launcher Equipment International Engineering Services Program also supports the U.S. Government’s FMS customers. Any disruption or delay will result in the inability to meet international agreements and will severely impact the system's readiness posture limiting the Warfighter from performing the intended mission.

(h) As a result, development of an alternate source by means of competitive acquisition for this required effort would require approximately in duplicated costs, which are not likely to be recouped through competition due to the lack of interest by another contractor. Competing this effort would also result in the loss of knowledge base and the risk of fielding unreliable missiles and launchers, which could be detrimental to the Warfighter and the USG. This acquisition is also a joint effort with FMS customers. Any disruptions or delays in PAC-3 support would cause a negative effect on the partnership between the USG and FMS partners. Failure to obtain approval of this Justification will lead to a break in service if the follow-on contract is not awarded by . A break in service would introduce unacceptable delays in sustainment services to the U.S. and FMS end users, which will severely impact the readiness posture limiting the Warfighter from performing the intended mission.

6. Efforts to Obtain Competition:

(a) Effective Competition. For reasons cited in paragraph 5, there is no alternate qualified source to provide the necessary services, hardware, facilities, equipment, and technical support necessary for the TA requirements, therefore no effective competition is anticipated. The Contracting Officer shall publish the notices required by FAR 5.201.

Pursuant to DFARS 206.302-1(d), a Request for Information/Sources Sought Announcement for the proposed PY 2024 through 2026 acquisition was posted via SAM.gov on for 15 days. The ACC-RSA received no responses. No other sources have expressed an interest in this acquisition. The Contracting Officer shall publish the notices required by FAR 5.201, Synopses of Proposed Contract Actions, and will consider any proposals received in response to the notice. LMMFC is currently performing this requirement on existing contracts, awarded on a sole-source basis and is technically capable to perform this work. In accordance with FAR 5.203(a) Publicizing and response time, a notice of intent to solicit and negotiate with only one source was published in SAM.gov on . Any proposals received will be given due consideration as prescribed by law.

(b) Subcontracting Competition: To minimize the adverse impact to small businesses, the contract will include contract clauses FAR 52.219-8, Utilization of Small Business Concerns; 52.219-9, Small Business Subcontracting Plan; and 52.219-28, Post-Award Small Business Program Representation; and FAR 52.244-5, Competition in Subcontracting.

(c) LMMFC participates in the DoD test program, as set forth in DFARS 252.219-7004, and is required to submit and adhere to an approved Small Business Subcontracting Plan. Historically, LMMFC has adhered to the annual Comprehensive Subcontracting Test Program Agreement, approved by Acting Director, Small Business Compliance Center, Defense Contract Management Agency, (DCMA), effective

. The Comprehensive Small Business Subcontracting Plan covers LMMFC locations in Orlando, FL, CAGE Code 1Q1J8. This plan requires LMMFC to submit monthly performance reports, quarterly reports of performance of targeted and focused initiatives, and a quarterly recovery plan to establish corrective action for any subcontracting goals or objectives that are not being met. The Comprehensive Subcontracting Test Program Agreement outlines the goals and reflects the efforts to provide Small Business Concerns the opportunity to compete for and participate in the performance of contracts awarded by Federal agencies. All contracts will incorporate the Comprehensive Small Business Subcontracting Plan that is approved each year to ensure that small business goals established and approved are met annually. All applicable FAR and DFARS clauses pertaining to subcontracting will be included in the solicitation and the resultant contracts.

7. Actions to Increase Competition:

(a) No competition is expected based upon both the results of the sources sought synopsis and the lack of a TDP. SHIELD Configuration Management is currently working with LMMFC to conduct a full review of the drawings and TDP utilized under the PAC-3 program. The latest data rights assertions submitted under the FY17/18 PAC-3 Production contract, , contain a total of 690 data rights assertions.

While this is not the full TDP, it is a representative sample, and it is being used on all of the active production contracts. Of those 690 assertions, 633 are special license rights, 48 are limited rights, and 9 are government purpose rights.

In the process of identifying new requirements, the SHIELD PO will continue to review these requirements for possible competitive procurement opportunities. For reasons cited in paragraph 5, no alternate qualified source can provide the TDPs, hardware, specialized production facilities, and equipment necessary to accomplish PAC-3 postproduction support. Any duplication of effort would result in an increase in overall program costs not reasonably expected to be recovered through competition. In cases where competition is feasible, LMMFC will be required to deliver those portions of the TDP, which do not contain restrictive markings to support breakout and repair part procurement actions through full and open competitive procedures, in accordance with

DFARS 227.7103.

(b) LMMFC is encouraged to compete subcontracts when it is reasonable to expect that competition is feasible and will produce equal or better performance with components at lower prices. As a participant of the DoD test program, as set forth in DFARS 252.219-7004, LMMFC is required to submit and adhere to an approved small business subcontracting plan that the DCMA reviews and approves annually. The most current agreed to Comprehensive Subcontract Test Program Fiscal Year 2024 Plan Agreement has an effective date from . The DCMA conducts annual reviews of Lockheed Martin’s performance under the Comprehensive Subcontracting Plan to assure compliance to incorporate small business goals and initiatives to ensure subcontracting goals meet criteria.

8. Market Research: Market research was conducted in accordance with FAR Part 10. A Market Research Report and Commerciality Determination (MRR-CD), Procurement Number was approved on , by the Procuring Contracting Officer. The MRR-CD effort was performed by the Logistics Management Specialist, SHIELD PO; Technical Lead, SHIELD PO; and the Acquisition Analyst, Lower Tier Interceptor, SHIELD PO through personal knowledge in procuring services of this type, contact with knowledgeable persons in the U.S. Government regarding the commercial nature of this requirement, review of recent market research results for similar services, and review of U.S. Government commercial databases for relevant information.

Collectively, the market research substantiates the finding that there are no other potential sources and there are no commercial items/services that will meet the U.S. Government’s requirement. The technical data package owned by LMMFC for the PAC-3 missile cannot be duplicated and is essential to overall success of the program. LMMFC is the only source that can provide the unique knowledge, experience, and training required to perform this effort. The PATRIOT/PAC-3 missile is a military specific weapon, and the U.S. Government’s needs and specifications cannot be met commercially utilizing FAR Part 12. The U.S. Government synopsized this proposed acquisition in SAM.gov on and any proposals received will be considered as prescribed by law.

Pursuant to DFARS 206.302-1(d), a sources sought announcement for this effort was publicized via SAM.gov on , for 15 business days. There were no replies to the sources sought for this acquisition. No effective competition has been found for this procurement due to the technical knowledge and expertise needed to fulfill this requirement within time and cost constraints.

9. Interested Sources: In accordance with FAR 5.201(b)(1), sources sought announcement was published on the SAM.gov website on for 15 business days. Subcontracting opportunities may be available. There were no replies to the sources sought for this acquisition.

10. Other Facts:

(a) Procurement History: The contracts listed in Table 5 below were all sole source actions awarded to LMMFC under the statutory authority permitting other than full and open competition, Title 10 U.S.C. Section 3204(a)(1), as implemented by FAR 6.302- 1(a)(2)(iii)(A) and (B), “Only one responsible source and no other supplies or services will satisfy agency requirements.” There have been no unusual patterns since the previous J&As were approved and the anticipated efforts for these contracts have been evaluated. No alternate qualified sources have been revealed and competition continues to be deemed as economically unfeasible.

Table 5: LMMFC Contract Data Contract Initial Award Date Definitization Date Amount

(b) As previously discussed, the U.S. Government is currently working with LMMFC to acquire additional government purpose rights for sustainment/maintenance of the PAC-3 missile.

(c) The major, Actions to Increase Competition and the resultant actions are summarized below:

POINT 1: The SHIELD PO encourages LMMFC to compete subcontracts when it is reasonable to expect that competition is feasible and will produce equal or better performance with components at lower prices.

RESULT 1: As a participant of the Department of Defense (DoD) test program as set forth in DFARS 252.219-7004, LMMFC is required to submit and adhere to an approved small business subcontracting plan. The most current Comprehensive Subcontract Test Program FY24 Plan Agreement has an approval date through

. The DCMA conducts annual reviews of Lockheed Martin’s performance under the Comprehensive Subcontracting Plan to assure compliance to incorporate small business goals and initiatives to ensure subcontracting goals meet criteria.

Subcontracting competition is encouraged by the inclusion of FAR 52.244-5, Competition in Subcontracting. The contracts included FAR 52.219-8, Utilization of Small Business Concerns, and DFARS 252.219-7004, Small Business Subcontracting Plan (Test Program). Interested sources, including Small Business, Veteran-Owned Small Business, Service-Disabled Veteran-Owned Small Business, HUBZone Small Business, Small Disadvantaged Business, and Women-Owned Small Business concerns which are identified through the synopsis will receive due consideration as required by law. Tables 6 and 7 show LMMFC’s corporate subcontracting goals and outcomes.

Table 6: Subcontracting Past Performance for Small Businesses (SB), Small Disadvantaged Businesses (SDB), and Women Owned Small Businesses (WOSB)

TOTAL

$ Goal

Actual % $ Goal

Actual

% $ Goal

Actual

GFY = Government Fiscal Year

Total Corporation

SB SDB WOSB

Subcontracting Past Performance - DoD Only

Table 7: Subcontracting Past Performance for HUBZone, Veteran Owned Small Businesses (VOSB), and Service-Disabled Veteran Owned Small Businesses

(SDVOSB)

POINT 2: The U.S. Government continues to review all intellectual property markings reflected in the current TDP and all newly submitted intellectual property markings. The SHIELD PO requires delivery of the complete PAC-3 configuration baseline drawings in the FY 2021-2023 PAC-3 production contract. Along with the requirement for LMMFC to deliver the configuration baseline drawings, the contract also includes DFARS clauses 252.227-7013, 252.227-7014, 252.227-7019, and 252.227- 7037 which require LMMFC to provide intellectual property rights assertions.

RESULT 2: The below listed technical data clauses and provisions were incorporated in the existing contract:

252.227-7013, Rights in Technical Data–Other Than Commercial Products and Commercial Services.

252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation.

252.227-7015, Technical Data–Commercial Products and Commercial Services.

252.227-7016, Rights in Bid or Proposal Information.

252.227-7019, Validation of Asserted Restrictions–Computer Software.

252.227-7027, Deferred Ordering of Technical Data or Computer Software.

252.227-7030, Technical Data–Withholding of Payment.

252.227-7037, Validation of Restrictive Markings on Technical Data.

TOTAL

$ Goal

Actual % $ Goal

Actual

% $ Goal

Actual

GFY = Government Fiscal Year

HUBZone VOSB SDVOSBTotal Corporation

Subcontracting Past Performance - DoD Only

The U.S. Government and LMMFC entered into an SLRA in December 1999. The SLRA was re-negotiated in with further revisions incorporated in

The agreement provides the U.S. Government unlimited rights to any technical data relating to an item, component, or process, as well as any computer software, developed exclusively at U.S. Government expense after , provided that technical data and computer software can be segregated from technical data and computer software existing prior to These rights do not provide the U.S. Government with the ability to compete this requirement. The SLRA allows the U.S. Government to use technical data and computer software included in the TDP for sustainment and depot maintenance purposes. Any documentation submitted by LMMFC with less than unlimited rights requires an assertion by the contractor to justify the restriction. The U.S. Government reviews these assertions and challenges the assertions if it is determined that the U.S. Government funded the development of a new item or the modification of the design of an existing item in part or in whole. The U.S. Government challenges any document marked inappropriately prior to acceptance with corrections required for non-conforming markings. Unjustified markings will be validated and challenged as appropriate, pursuant to DFARS 252.227- 7019, Validation of Asserted Restrictions—Computer Software and 252.227-7037, Validation of Restrictive Markings on Technical Data.

POINT 3: Future PAC-3 post-production requirements will continue to be evaluated to determine whether competition would be economically feasible and in the best interests of the U.S. Government. As new requirements are identified, the SHIELD PO will continue to review these requirements for possible competitive procurement opportunities.

RESULT 3: As stated in paragraphs 5 and 6, competition is still not deemed to be economically feasible given the U.S. Government’s lack of relevant data and the unacceptable cost and time that would be associated with standing up a second source even if sufficient data rights were available.

APPROVAL

Based on the foregoing justification, I hereby approve the procurement of Technical Assistance support for the Phase Array Tracking Radar to Intercept of Target (PATRIOT) Advanced Capability (PAC)-3 requirements, during 36-month Period of Performance, , on an other than full and open competition basis pursuant to the authority of Title 10, United States Code, Section 3204(a)(1), as implemented by Federal Acquisition Regulation 6.302- 1(a)(2)(iii)(A) and (B), "Only one responsible source and no other supplies or services will satisfy agency requirements", subject to availability of funds and provided that the services herein described have otherwise been authorized for acquisition. This acquisition includes highly specialized technical support for the PAC-3 missile Field Surveillance Program, and PAC-3 missile post-production activities. Lockheed Martin Missiles and Fire Control, Commercial and Government Entity Code 1Q1J8, shall furnish all services, hardware, facilities, and equipment, and provide all planning, management, technical and logistical support for testing, failure analysis, quality, reliability, and maintenance support. The estimated Period of Performance is . The total estimated value for both the United States and Foreign Military Sales contract actions is

SIGNATURE: DATE: ______________

NAME: TITLE: Senior Contracting Official