JOTFOC 11-04-22 fully executed.pdf

Justification and Approval for Other than Full and Open Competition Sturgeon Electric Company

U.S. General Services Administration

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

Only One Responsible Source - FAR 6.302-1

Sol # 47PJ0022R0102 Y-Side Substation Transformer

Replacement

The Public Buildings Service (PBS) of the General Services Administration (GSA), Rocky Mountain Region, proposes to contract the requirements described herein by means of other than full and open competition. Contracting by such means is authorized by FAR Subpart 6.3 and is supported by this justification prepared in accordance with FAR 6.303-2.

1. Identification of the agency and the Contracting Activity: General Services Administration, Public Buildings Service, Rocky Mountain Region, Denver Federal Center Service Center.

2. Summary of Action Being Approved: This justification authorizes and approves a sole-source construction activity to Sturgeon Electric Company (Sturgeon) to alter the existing electrical substation at the Denver Federal Center, Lakewood, Colorado. More specifically, Sturgeon would replace equipment and underground cabling at the 115kV/13.8kV substation (known as the Denver Federal Center “Y-Side” substation transformer) including replacing one of the two 22.4MVA transformers and switchgear cabinets and all necessary related work. The related work includes demolition of the existing transformer and switchgear and bringing the transformer site up to current spill containment standards. The contract would include the purchase of the new transformer equipment.

3. Description of the supplies or services required to meet the agency’s needs, including the estimated value:

As outlined by the Contracting Officer’s Representative (COR) and provided in the attached specification details, GSA would award a single contract to Sturgeon to complete the following necessary electrical upgrades at the Denver Federal Center in Lakewood, CO:

The Y-Side Substation Transformer, one of the two existing primary substation transformers at the Denver Federal Center, identified in the attached project scope of work is beyond its life cycle, at risk of eminent failure, and unsafe to work on. The transformer is leaking cooling and insulating oils.

Damages which may occur are the Denver Federal Center losing power. A loss of power would be detrimental to operations costing the U.S. taxpayer significant dollars in lost government business and productivity.

DFC “Y”-Side Substation Replacement

- Provide manufacturer engineering, purchase, and deliver a new “Y” side Substation transformer to match the performance characteristics of the existing “X” side Substation transformer.

- Provide manufacturer engineering, purchase, and deliver a new 15kv “Y” side switchgear. The new switchgear sections shall match the existing section’s purpose with new circuit breakers, protective relays, and metering cabinets.

- Engineer and design a set of construction documents and specifications for the civil, structural, and electrical work for the replacement of the “Y” side Substation. The design shall incorporate the transformer and switchgear.

- Civil/Site Work:

• The construction and capacity of the foundation underneath the existing transformer equipment, is unknown. To ensure optimal operation from the new equipment, Sturgeon shall fully remove the existing foundation. Sturgeon will design a new foundation sized and engineered to meet the geotechnical conditions and weight of the new transformer and equipment to be installed.

• Sturgeon will also construct an oil retention pit or curb, with tank. This oil retention pit or curb and tank will be designed to hold all of the oil plus the addition of standing rainwater level for an entire year at the DFC.

• The existing secondary transformer feed is overhead. Sturgeon shall remove and install a new concrete duct bank from the transformer to the existing switchgear pad.

• The existing “Y” side switchgear concrete pad and underground distribution will remain as now existing.

- Sturgeon shall Test and Commission all new electrical equipment according to ANSI NETA

ECS.

Please see project scope for exact work description (attached).

The estimated cost for this project is $2,942,436.32. This total project cost is estimated for material and labor plus an overhead and administrative costs and contingency. The following table further breaks down the subtotal estimated cost:

Y-Side Substation Replacement Total Project Cost Estimate Total $2,942,436.3221-Jul-22 Building CO0100AA Item Description Total Material Total Labor Total Cost Equipment Purchase Substation Transformer $995,000.00 $26,250.00 $1,021,250.00 15kV Switchgear $390,000.00 $26,250.00 $416,250.00 Shipping & Crane $15,000.00 $3,000.00 $18,000.00 Testing $500.00 $15,000.00 $15,500.00Design - Site Application Engineering $5,500.00 $83,500.00 $89,000.00 Relay Programming and Commission $14,500.00 $14,500.00 Arc Flash Study $1,500.00 $11,500.00 $13,000.00 Project Management $65,000.00 $65,000.00Demolition $26,900.00 $108,300.00 $135,200.00New Construction Site & Structural Work $6,500.00 $130,650.00 $137,150.00 Cables and Conduit $21,550.00 $20,298.00 $41,848.00 Power Transformer $17,700.00 $96,950.00 $114,650.00

Power Switchgear $34,000.00 $61,950.00 $95,950.00Bonds/Insurance/Overhead/Profit/ General Conditions/Contingency $497,514.48 $267,623.84 $765,138.32 Total Estimated Cost $2,942,436.32

4. Statutory Authority Permitting Other than Full and Open Competition: 41 U.S.C. § 3304(a)(1), as cited in FAR 6.302-1, allows for other than full and open competition when the supplies or services that the Government requires are available from only one responsible source, and no other type of supplies or services will satisfy the needs of the Government.

5. Demonstration that the Nature of the Acquisition Requires Use of the Cited Authority:

In accordance with FAR 6.302-1, it is permissible to acquire supplies or services without competition where, as here, the supplies or services are available from only one responsible source and no other source will satisfy the needs of the agency. In this case, GSA must ensure that the electrical grid at the Denver Federal Center remains unharmed to prevent catastrophic damage to electrical infrastructure and to ensure that the many federal agencies that depend on seamless use of space at the Denver Federal Center receive uninterrupted electrical service.

As background, GSA is responsible for maintaining all federal buildings and supporting systems at the Denver Federal Center and ensuring that the federal buildings on site preserve the health and welfare of federal employees who work within the buildings. The electrical grid components in the substation requires improvements to continue to provide the expected level of service to all federal agencies on the Denver Federal Center. In this instance, GSA must replace an unsafe electrical transformer that serves the entire Denver Federal Center. The current electrical “Y” side substation transformer is beyond its useful life. It must be removed and replaced with a new transformer.

Sturgeon is currently the sole contractor for GSA’s electrical grid operations and maintenance (O&M) contract covering all of the Denver Federal Center. Award to any other contractor would introduce additional complexity to the arrangement of contractors responsible for and working along the electrical grid. Any additional complexity would likely increase the chance of a mistake on the part of the additional crews who would be working on the grid, which in turn would increase the possibility of a catastrophic and total failure of the electrical grid. As such, awarding this contract to Sturgeon, which is already responsible for continued maintenance and repair of the electrical grid, is primarily to reduce risk of a catastrophic failure along the Denver Federal Center electrical grid. Additionally, Sturgeon has continued to demonstrate good past history and performance.

Moreover, the current O&M contract would allow GSA to order this type of work without need for a justification for other than full and open competition if the total estimated value were under the maximum order threshold of the Simplified Acquisition Threshold (SAT). Because the estimated cost of this work exceeds the SAT, ordering off this contract vehicle is not possible. As a result, the CO must seek approval for a sole source acquisition to satisfy these requirements. Had the estimated cost not exceeded the SAT, this work would be a routine order under Sturgeon’s current contract.

Because of the complexity involved in maintaining the entirety of the electrical grid without any catastrophic failures by just a single contractor, award to a different contractor for these construction services would increase the likelihood of a catastrophic equipment failure in the electrical grid at the Denver Federal Center. The Public Building Service is aware that when more complexity is added to electrical grid operations, there follows a higher risk of a catastrophic failure—meaning, a higher chance of total blackout. Any risk of catastrophic failure is unacceptable because so many different agencies depend on continuous electricity service in their various offices and lab spaces, that any interruption would have high costs to the ongoing success of all of those agencies’ missions. In maintaining the Denver Federal Center’s electrical grid, the best and safest practice for GSA’s tenant agencies is to hire a single service provider who operates, maintains, and repairs the entire electrical grid throughout the campus. By awarding this electrical grid upgrade work to Sturgeon, GSA alleviates risk of a catastrophic failure occurring.

6. Actions Taken to Remove Competition Barriers and Solicit Offers from Other Sources.

The current O&M contract with Sturgeon was awarded effective 12/1/2019. Currently, the contract is in its second option year and is set to expire on November 30, 2022, with two more one-year renewal options. This base contract for O&M services at the Denver Federal Center was awarded using full and open competition. Sturgeon was the only qualifying proposal received. At the expiration of the current contract, if subsequent requirements still exist, GSA will make every effort to seek full and open competition.

This O&M contract allows for similar services under this Justification to be completed as part of a task order. In other words, GSA will ensure that the next procurement for all types of O&M work for the electrical grid, including replacing transformers like those at issue in this Justification, (if subsequent requirements fall within the ordering limits) will be competed—obviating the need for any further justification for other than full and open competition in the future.

7. Determination that the Anticipated Cost/Price will be Fair and Reasonable.

The Contractor’s price estimate has been analyzed by comparing it with comparable market pricing.

GSA’s Project Manager, Michael Golenda and GSA’s technical expert, Phillip Inman, have consulted with electrical providers on these items to verify pricing. The hourly rate in the estimate is unitized and based off a blended straight time and overtime Sturgeon Electrical rate per CBA requirements, fringes and benefits.

Based on such review, the Government’s anticipated cost of $2,942,436.32 will be fair and reasonable based on material and labor pricing and a reasonable markup/contingency. The price analysis will include consideration of the effect of any changes to the Service Contract Act Wage Determinations or Collective Bargaining Agreements.

8. Market Research, FedBizOpps Announcement, and Listing of Interested Sources.

The Denver Federal Center provides high voltage electrical services from the main transformers to all buildings housing major business operations. These tenant agencies include critical operations such as BLM, Data Centers, the Ice Core Labs and other major operations. These services require operating services 24/7, including a crew response time of less than an hour for any emergency power outage.

Due to the unique requirements of the tenant agencies at the Denver Federal Center and the need to provide continuity services, it was determined that there were no qualified small business’ in the required response range area at this time. While market research has shown that there are small businesses who can provide some of the requirements of this contract, there are no qualified small business entities that can perform the total requirement due to the nature of this work. GSA will continue to work closely with SBA to ensure that the Government researches all potential subcontracting opportunities for socioeconomic business concerns.

9. Other Facts Supporting the Use of Other than Full and Open Competition

The Denver Federal Center is supplied by two independent medium voltage electrical distribution grids referred to as “X” and “Y”, supplied by Xcel Energy at 115kV, identified in the scope of work.

This is unique in that the medium voltage service is maintained by Sturgeon Electric Company for the approximate one square mile of buildings and land rather than Xcel Energy, the utility provider for the surrounding cities and communities. To reduce the risk of a catastrophic failure by adding complexity to contractor arrangements working on the electrical grid, a sole source procurement to the current repair, operation, and maintenance provider for the Denver Federal Center electrical grid is proper.

CERTIFICATION (FAR 6.303-2(b)):

I certify that supporting technical data and/or documentation are accurate and complete to the best of my knowledge and belief. It is appropriate to use such information to establish the basis for this justification.

Contracting Officer: Laura Magee, Contracting Officer

Signature Date

Review for Legal Sufficiency

Assistant Regional Counsel: Mikhail Petersen, GSA Region 8

Review Competition Advocate

GSA Region 8 PBS Competition Advocate: G.W. Emge, Director, GSA R8

CERTIFICATION (Per FAR 6.303-2(a)(12)):

I certify this justification is accurate and complete to the best of my knowledge and belief.

Contracting Officer: Laura Magee, Contracting Officer

Digitally signed by LAURA MAGEE DN: C=US, O=U.S. Government, OU=General Services Administration

, CN=LAURA MAGEE + OID.0.9.2342.19200300.100.1.1=

47001001049710 Reason: I am the author of this document Location:

Date: 2022.11.04 11:36:01-06'00' Foxit PDF Editor Version: 12.0.1

LAURA MAGEE

MIKHAIL PETERSEN

Digitally signed by MIKHAIL

PETERSEN

Date: 2022.11.04 11:46:43 -06'00'