JA VA-20-00087967 (HPE Fair Exception)_Redacted.pdf

BISL NST HPE Server wGPUs Control Number: VA-20-00087967

JUSTIFICATION

FOR AN EXCEPTION TO FAIR OPPORTUNITY

1. Contracting Activity: Department of Veterans Affairs (VA)

Office of Procurement, Acquisition, and Logistics Technology Acquisition Center 23 Christopher Way Eatontown, NJ 07724

2. Description of Action: This proposed action is for a firm-fixed-price delivery order to be issued under the National Aeronautics and Space Administration (NASA) Solutions for Enterprise-Wide Procurement (SEWP) V Governmentwide Acquisition Contract (GWAC) for a brand name Hewlett Packard Enterprise (HPE) server and associated software and warranty support.

3. Description of Supplies or Services: The Department of Veterans Affairs (VA), Business Intelligence Services Line (BISL) has a requirement for one brand name Hewlett Packard Enterprise (HPE) ProLiant DL580 Gen10 server, to include all associated software and remote installation, startup, and system performance verification services, cables, and racking equipment. The HPE ProLiant DL580 Gen10 server and associated software and components shall also include a 5-year HPE Proactive Care Service (warranty support coverage) to include 24 hours a day, 7 days a week (24x7) technical support and 24x7 Software Service with Defective Media Retention (DMR). The delivery of hardware shall be within 30 days of receipt and processing of the delivery order. The Contractor shall complete remote installation and configuration of server within 30 days of equipment delivery. This action also includes optional tasks for optional quantities of up to four additional NVIDIA Tesla V100-32 GB PCIE Graphics Processing Unit modules and up to six additional HPE SN1600E 32GB FC Host Bus Adapters. The period of performance for the warranty support shall be five years from receipt of the end items. The total estimated price of the proposed action is , inclusive of the two optional tasks.

4. Statutory Authority: Pursuant to Federal Acquisition Regulation (FAR) 16.505(a)(4), the following brand name requirement is being justified and approved as an exception to fair opportunity under the statutory authority of Section 41 U.S.C.

4106(c)(2) as implemented by FAR 16.505(b)(2)(i)(B), entitled “Only one awardee is capable of providing the supplies or services required at the level of quality required because the supplies or services ordered are unique or highly specialized.”

5. Rationale Supporting Use of Authority Cited Above: Based on market research as described in section 8 of this justification, it was determined that limited competition is available among authorized resellers for the required brand name HPE ProLiant DL580 Gen10 server and associated software and warranty support. The Government requires this equipment to expand and strengthen the current Corporate Data Warehouse (CDW) infrastructure at the Austin Information

Technology Center (AITC) to support the National Surveillance Tool (NST). This tool brings together information from dozens of different publicly available internal and external databases to provide an unprecedented view of the battlefield in the war against COVID-19, thereby allowing Veterans Health Administration leadership to monitor its national COVID-19 case load, hospital staffing, and bed and supply availability in real-time. As the volume of COVID-19 data continues to increase, the infrastructure must be expanded and strengthened to support the growing volume of data, and be able to process it quickly enough to provide the real-time views that allow VA staff to see all the elements necessary to run its health care systems from a strategic, operational, or tactical perspective. The HPE ProLiant DL580 Gen10 server will be deployed within an existing server environment that is comprised of only HPE hardware and software. Therefore, only HPE brand equipment can be fully compatible within the existing HPE-based infrastructure, which includes dozens of HPE servers and storage devices.

The existing HP servers are proprietary to HPE and, due to the included proprietary HPE code, no other brand name servers are compatible with the current server infrastructure. Only HPE servers and can interoperate within VA’s existing HPE server environment at the AITC. Specifically, no other brand name server will communicate and function within the current infrastructure due to the aforementioned proprietary constraints. Due to technical compatibility requirements and the proprietary constraints of HPE servers, expanding the computing resources to support the NST requires the same hardware as what is currently in used in the CDW environment at the AITC. Any additional server and associated components are required to fit and have 100 percent compatibility in an already existing HPE environment; therefore, HPE and its authorized resellers are the only providers that can provide the brand name servers and associated software and components that are fully compatible within the HPE-based infrastructure at AITC. Furthermore, use of any other brand name server would require VA to replace the existing HP server environment, causing extensive delivery delays that would not be recovered through competition. Since the current HPE infrastructure consists of dozens of existing servers and storage devices, the replacement cost would be approximately several million dollars, and the time required to procure these replacements would result in several months of downtime for the environment. These estimates are based on similar previous efforts. Since a stable, running environment is required to sustain VA’s healthcare providers and researchers, this cost and delay is prohibitive.

Finally, only HPE or its authorized resellers have the access to the proprietary data and source code necessary to provide warranty services for the hardware and software within the server. The proprietary code is required to ensure the server is properly operational and defects properly resolved. Access to HPE proprietary data and source code is required to provide the required warranty services on the server and ensure all the services provided are properly configured. Failure to procure the brand name warranty services would hamper VA’s ability to maintain the operational status of the server and greatly disrupt research and care being provided by VA’s healthcare providers.

6. Efforts to Obtain Competition: Market research was conducted, details of which are in section 8 of this justification. This effort did not yield any additional sources that can meet the Government’s requirements. However, it was determined that limited competition is viable among resellers for these brand name items. In accordance with FAR 16.505(a)(4)(iii)(A)(1), this justification will be provided with the solicitation to all appropriate NASA SEWP V GWAC holders. Furthermore, in accordance with FAR 5.301, 16.505(b)(2)(ii)(D), and 16.505(a)(4)(iii), the award notice for this action will be synopsized on the System for Award Management’s Contracting Opportunities website and this justification will be made publicly available within 14 days of award.

7. Actions to Increase Competition: The Government will continue to conduct market research to ascertain if there are changes in the marketplace that would enable future actions to be competed. Specifically, the Government will continue to research whether non-HPE parts can interoperate with the current environment without performance degradation or violating warranties of other HPE equipment that are currently in use in the CDWHPE environments, which must interoperate with the HPE equipment for which warranty coverage is being procured under this action.

8. Market Research: Market research was conducted in July 2020 by Government technical experts by searching internet sites, and obtaining information from vendors for information on its server equipment. Vendors were provided with the precise data center specifics and were asked to identify servers to expand the existing BISL environment to support the NST. The results of the market research confirmed that only HPE or its authorized resellers have the capability of providing servers that are compatible with the existing infrastructure. These products did not meet the requirement to integrate seamlessly with the current environment. This brand name equipment is required to fit and have 100 percent compatibility in an already existing HPE environment. Furthermore, the market research results indicate that only HPE and its resellers of HPE products can provide warranty on the HPE servers as no other manufacturer has the required access to HPE proprietary data and source code required to provide the support coverage.

Additional market research was conducted in August 2020 utilizing the Provider Lookup tool on the NASA SEWP V GWAC website which identified multiple Service- Disabled Veteran-Owned Small Business (SDVOSB) Value Added Reseller GWAC holders in Group B(2) that provide the brand hame HPE hardware and warranty.

Therefore, limited competition is anticipated on NASA SEWP V among SDVOSBs for this proposed action.

9. Other Facts: None.

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

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

Contracts awarded on NASA SEWP V GWAC have already been determined to be fair and reasonable. As there are multiple resellers on the NASA SEWP V GWAC capable of providing the HPE Server and associated software and warranty support, price competition is anticipated. Finally, if only one quote is received price analysis shall be conducted by comparing the successful quote to the Independent Government Cost Estimate.

12. Procuring Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief. As this contract action exceeds the simplified acquisition threshold, but does not exceed $700,000, the certification required by FAR 16.505(b)(2)(ii)(C)(1) serves as approval.