JOFOC.docx

Justification for Other Than Full and Open Competition

(1) Identification of the agency and the contracting activity:

(2) Nature and/or description of the action being approved:

The International Trade Administration (ITA), a bureau within the U.S. Department of Commerce (DOC), has a requirement for a Dynamic General Equilibrium (GE) model and database of the world economy that enables ITA to analyze the global impact of trade and economic policies over a short to intermediate-run period incorporating industry specific capital and an explicit financial market structure.

(3) A description of the supplies or services required to meet the agency’s needs:

Develop and transfer a dynamic Computable General Equilibrium (CGE) model of global trade that incorporates a module containing an explicit specification of financial flows. The new model will be based on the Global Trade Analysis Project’s (GTAP) Global database and will incorporate the following features:

1)Industry Specific Capital The model to be developed will treat capital once committed to an industry as fixed in that industry. In addition, the model will introduce technologies for creating capital so that the inputs required to produce capital for industries will differ across industries. Thus, for example, the inputs needed to produce capital for agriculture sectors will be different than the inputs needed to produce capital for use in banking.

2) Sticky-wage Adjustment The model to be developed will treat wages as close to fixed in the short-run while employment adjusts. The adjustment in employment will affect wages, gradually moving them to their new long-run equilibrium with a corresponding movement in employment back to its baseline path.

3) Financial Markets The model to be developed will incorporate a module specifying equations that describe optimization problem of financial agents and the links between the budgets of financial agents and rest of the economy. The module will link the real and financial sides of the economy by describing the financing of the public-sector deficit, the current-account deficit and private-sector investment.

Centre of Policy Studies Victoria University Melbourne, Victoria, 8001 Australia.

(4) An identification of the statutory authority permitting other than full and open competition:

The statutory authority permitting other than full and open competition is FAR 13.106-3(b), “Only one source reasonable available”

(5) A demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited:

The International Trade Administration’s Office of Trade and Economic Analysis (OTEA) performs in-depth trade and economic analysis for industry and policy decision makers and provides a solid foundation of trade and industry data to support the development of national trade policies. Recent tasks assigned to OTEA have demonstrated that OTEA’s analytical capabilities would benefit greatly from the acquisition of a dynamic global Computable General Equilibrium model with realistic assumptions regarding industry capital and wage rigidity, as well as a fully formed financial sector.

The Center of Policy Studies, located at Victoria University, is a world leader in the development of dynamic computable general equilibrium models. OTEA has used United States Applied General Equilibrium (USAGE) model and database for more than 10 years and believe that such employment/procurement has ensured that OTEA fulfils its analysis capacity and keep up with high quality research in US industry competitiveness. It is the view of OTEA that the Center of Policy Studies is best suited to develop a model with the desired characteristics.

The existing alternative dynamic global CGE model is produced by the Global Trade Analysis Project. The members of the quantitative analysis team in OTEA have carefully explored this model including receiving training in its structure and use. Because this model lacks the characteristics described above with respect to capital, labor markets and a fully formed financial sector, OTEA found that the dynamic model produced by the Global Trade Analysis Project dynamic model does not fulfill OTEA’s requirements.

(6) A description of efforts made to ensure that offers are solicited from as many potential sources as is practicable, including whether a notice was or will be publicized as required by Subpart 5.2 and, if not, which exception under 5.202 applies:

N/A

(7) A determination by the contracting officer that the anticipated cost to the Government will be fair and reasonable:

The Contracting Officer has determined that the anticipated cost to the Government will be fair and reasonable based on the application of price analysis techniques in accordance with FAR 15.404-1(b), including comparison of proposed prices to historical prices paid and independent government cost estimates.

(8) A description of the market research conducted (see Part 10) and the results or a statement of the reason market research was not conducted:

Market research was conducted through the posting of the intent notice, in accordance with FAR 5.203 referenced above, that requested capability statements to fulfill the requirement. The results of the market research confirmed that only the Center for Global Trade Analysis at Purdue University holds the technical qualifications that meet the criteria.

(9) A listing of the sources, in any, that expressed, in writing, an interest in the acquisition:

No responses were received from the public or industry in response to the publicized synopsis of the proposed contract action and no sources have otherwise expressed, in writing, an interest in the acquisition.

(10) A Statement of the Actions, f any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for supplies or services required:

For future requirements for the development of a hybrid General Equilibrium-Partial Equilibrium (GE-PE) model, ITA and Enterprise Services – Acquisition anticipate posting competitive solicitations.

(11) Program Official’s Certification that the justification is accurate and complete to the best of the Program Official’s knowledge and belief:

The program official for this acquisition hereby certifies that the information provided in support of this justification for other than full and open competition, and which forms the basis for the justification, is accurate and complete to the best of their knowledge and belief.

Date Program Official

(12) Contracting Officer’s Certification that the justification is accurate and complete to the best of the Contracting Officer’s knowledge and belief:

The Contracting Officer hereby certifies that the information provided in support of this justification for other than full and open competition is accurate and complete to the best of their knowledge and belief.

Date Contracting Officer

(13) Pursuant to CAM 1306.70 Section 2.5(f), approval by the Department Competition Advocate is required for any actions under $700,000:

The Department Competition Advocate for this acquisition hereby certifies that the information provided in support of this justification for other than full and open competition is accurate and complete to the best of their knowledge and belief.

Date Department Competition Advocate