JARecommended_Redaction-TIGER_II_CY1617_extension_(CMO_15-155)_Redacted.pdf

CMO Control Number: 2015-155 TIGER Engine Program

Justification Review Document for Other than Full and Open Competition

Program/Equipment: Total InteGrated Engine Revitalization (TIGER) program

Authority: 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii)(A)(B)

Amount: $374,000,000.00

Prepared by:

Typed Name: Justin Kalousdian DSN: 330-6071

Title: Contract Specialist Date: 27 Jul 2015

E-mail: justin.a.kalousdian.civ@mail.mil

Contracting Officer:

Typed Name: LISA BEHNKE DSN: 330-6090

E-mail: lisa.m.behnke.civ@mail.mil Date Reviewed: 18 Aug 2015

Technical Representative:

Typed Name: CONSTANCE M. TUCKER DSN: 786-7703

Title: Deputy Project Director Date Reviewed: 13 Aug 2015 Main Battle Tank Systems (MBTS)

E-mail: constance.m.tucker.civ@mail.mil

Technical Representative:

Typed Name: JERRY FIGUEROA DSN: 786-6825

Title: DIRECTOR, R&S Date Reviewed: 24 Aug 2015 Ground Combat Systems

E-mail: jerry.a.figueroa.civ@mail.mil

Requirements Representative:

Typed Name: CONSTANCE M. TUCKER DSN: 786-7703

Title: Deputy Project Director Date Reviewed: 13 Aug 2015 Main Battle Tank Systems (MBTS)

E-mail: constance.m.tucker.civ@mail.mil

Requirements Representative:

Typed Name: JERRY FIGUEROA DSN: 786-6825

Title: DIRECTOR, R&S Date Reviewed: 24 Aug 2015 Ground Combat Systems Integrated Logistics Support Center (ILSC)

E-mail: jerry.a.figueroa.civ@mail.mil

Reviews: I have reviewed this justification and find it adequate to support other than full and open competition.

Program Executive Office (PEO, for PEO-managed items)

Typed Name: BG DAVID G. BASSETT DSN: 786-6662 Title: Program Executive Officer, Ground Combat Systems

Signature Date

Integrated Logistics Support Center (ILSC, for ILSC-managed items)

Typed Name: BRIAN BUTLER DSN: 786-6090 Title: Executive Director, Integrated Logistics Support Center (ILSC)

//Signed// BdB 24 AUG 2015 Signature Date

Legal Counsel

Typed Name: ARTHUR M. BOLEY DSN: 786-7646 /s/ AMB 19 AUG 2015

Signature Date

Special Competition Advocate (SCA)

Typed Name: LARUTH SHEPHERD DSN: 786-6597

Signature Date

Principal Assistant Responsible for Contracting (PARC)

Typed Name: JOHN D. JOLOKAI DSN: 786-7069

Signature Date

The AGT 1500 engine is used on the following programs and production lines: Abrams tanks (M1A2, M1A1, and RESET), United States Marine Corps (USMC) M1A1 tanks, Foreign Military M1A1 Abrams tanks, Federal Supply System (FSS), Assault Breacher Vehicles, and the Joint Assault Bridge Vehicles. The TIGER engine program overhauls the AGT 1500 engine to a near new standard to include durability based design improvements.

4. Authority Cited: The statutory authority permitting “Other than Full and Open Competition” is Title 10 United States Code (U.S.C.) 2304(c)(1) as implemented by Federal Acquisition Regulation (FAR) 6.302-1(a)(2)(iii)(A)(B), “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.”

Specifically, “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” and “unacceptable delays in fulfilling the agency’s requirements.”

5. Reason for Authority Cited: Honeywell (formerly Allied Signal Engines, Textron Lycoming and AVCO Lycoming), the original equipment manufacturer (OEM) of the AGT 1500 turbine engine, has extensive technical and production expertise including engine durability improvements and First Pass Yield (FPY) testing required to provide innovative initiatives to improve the reliability of the AGT 1500 overhauled engines.

Over the past 30 years, Honeywell has gained the institutional knowledge and hands-on experience through production, system technical support, and field service support of the engine. As the OEM, Honeywell is uniquely qualified to implement an AGT 1500 engine closed loop data collection system and follow-on durability design improvements.

a. The TIGER overhaul program provides ANAD with EMOT instructions to overhaul the AGT 1500 engine. Honeywell has patented this EMOT process, which includes an interactive database of drawings, instructions, and process sheets to produce consistently reliable engines. Honeywell developed the specific step-by-step EMOT instructions for AGT 1500 repair and overhaul using its decades of experience designing and working with AGT 1500 engines, its knowledge of commercial turbine engine repair best practices, and its knowledge of the Army’s National Maintenance Work Requirements (NMWR). Although the Government has unlimited rights to the technical data procedures contained in the EMOT software, the Government possesses only limited data rights to technical data; information and assistance including disassembly and assembly MOTs; work Instructions; quality procedures; Acceptance

Hardware (AGT 1500 Parts) $298.0M Hardware Services $36.0M Technical Engineering Services (STS) $40.0M

TOTAL (in millions) $374.0M

Rough Order of Magnitude (ROM) estimate from Honeywell for the purchase of unlimited rights to the nine parts along with EMOT software. Honeywell replied in December 2013 with a ROM estimate of $550M. If the Government were to purchase unlimited rights, the delay caused from qualifying new component sources would result in unacceptable interruption to the engine overhaul line at ANAD and the tank production line at the JSMC. Therefore, any AGT 1500 engine improvement program would have to include Honeywell at some capacity for the procurement of the nine components and EMOT software. The required inclusion of Honeywell would prevent the Government from recouping the expense of unlimited rights through future competitive procurements.

6. Efforts to Obtain Competition:

a. Effective competition: There is no plan to obtain competition for this contractual action on the prime contractor level. Durability improvements in the AGT 1500 are dependent on Honeywell. Only Honeywell, with its unique AGT 1500 engine experience and on-going relationship with ANAD, can provide a near term solution for improving the readiness of the engine supporting the Abrams tanks.

b. Subcontracting competition: Efforts at competition will be limited to the subcontractor level. This action will be synopsized in FedBizOpps for subcontracting opportunities.

The TIGER program, AGT 1500 engine production, and STS requirements were synopsized in the past and no potential sources responded to the announcements.

7. Actions to Increase Competition:

This contract action is required to allow time for the execution of a DoD-wide Enterprise Performance Based Logistics (EPBL) contract anticipated for award in October 2016.

The viability of EPBL is based on a decision point in 2nd quarter FY16 from the Deputy Assistant Secretary for Procurement (DASA(P)), the Under Secretary of Defense for Acquisition, Technology and Logistics (AT&L), and the Director, Defense Procurement and Acquisition Policy & Strategic Sourcing (DPAP). Should EPBL not be awarded, ACC-WRN will work to develop a new follow-on TIGER III contract.

Competition of future TIGER procurements would be impractical because of the requirements to continue TIGER program durability design improvements and testing, condition based overhaul, reset and sustainment engines, and fuel efficiency improvements. There would be an unacceptable delay for a new contractor to gain the level of expertise required to understand and meet these requirements. For these reasons and those cited in paragraph five above, efforts will be made to increase competition in subcontracting.

8. Market Research:

a. A Request for Information (RFI) market survey for TIGER program requirements was posted to the ACC-WRN Procurement Network (ProcNet) by TACOM Life Cycle

9. Interested Sources: To date, no other sources have written to express an interest.

In accordance with FAR 5.203(c), the TIGER program will be synopsized in FedBizOpps to identify contracting and subcontracting opportunities and to notify potential offerors of the Government’s requirement.

10. Other Facts:

a. Procurement History.

(1) Contract W56HZV-12-C-0344, referred to as TIGER II, was awarded on a sole source basis as an undefinitized contract action (UCA) on 30 July 2012 and definitized on 30 May 2013. The total definitized contract value was $98,945,491.92. The contract period of performance was later extended by modification through 31 December 2014 to a total contract value of $119,357,831.77. The Senior Procurement Executive signed a Justification and Approval (J&A) on 9 February 2012 approving the use of “Other than Full and Open Competition” citing the exception at 10 U.S.C.

2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii)(A)(B), “Only One Responsible Source.” The contract period of performance was again extended by modification through 31 December 2015 resulting in a revised total contract value of $159,149,085.49. As sole source justification for that extension, the Deputy to the Commanding General of Army Contracting Command (ACC), signed a J&A on 18 November 2014 approving use of “Other than Full and Open Competition” citing the exception at 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii)(B), “Only One Responsible Source.”

(2) Contract W56HZV-12-C-0133, referred to as TIGER Bridge, was awarded on a sole source basis on 1 February 2012 for a six month period of performance. Total contract value is $72,464,669.61. A Justification and Approval was signed on 1 December 2011 approving use of “Other than Full and Open Competition,” citing the exception 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii)(A)(B), “Only One Responsible Source.”

(3) Contract W56HZV-06-C-0173, referred to as TIGER I, was awarded on a sole source basis on 16 December 2005. The total contract included performance for a six year period and resulted in a final contract value of $1,774,620,986.81. A Justification and Approval was signed on 19 October 2005 approving use of “Other than Full and Open Competition,” citing the exception 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii)(A)(B), “Only One Responsible Source.”

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.

CONSTANCE M. TUCKER

Deputy Project Director

//signed// 13 Aug 2015

JERRY FIGUEROA

DIRECTOR, R&S

Jerry Figueroa 24 Aug 2015

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.

CONSTANCE M. TUCKER

Deputy Project Director

//signed// 13 Aug 2015

JERRY FIGUEROA

DIRECTOR, R&S

Jerry Figueroa 24 Aug 2015

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost for this contract action will be fair and reasonable. This determination will be based on results of a DCAA Audit, DCMA Technical Data, Cost and Price Analysis and certified cost or pricing data. A Certificate of Cost or Pricing data will be required.

Lisa Behnke Contracting Officer

//S/LB 18 Aug 2015

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

Lisa Behnke Contracting Officer

//S//LB 18 Aug 2015

APPROVAL

Based on the foregoing justification, I hereby approve the contract extension to procure two additional program years for TIGER II hardware requirements and System Technical Support engineering services ordered in calendar year 2016 and 2017, in addition to TIGER hardware services from 1 January 2016 through 31 December 2017, from Honeywell International, Inc. on an other than full and open competition basis pursuant to the authority of Title 10 United States Code 2304(c)(1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. The approval is subject to availability of funds, and provided that the services and property herein described have otherwise been authorized for acquisition. The total estimated value for this acquisition is $374 million.

Date Heidi Shyu

Senior Procurement Executive