Justification and Approval for HEC Support Contract.pdf

U.S. Department of Transportation 1200 New Jersey Avenue, SE Maritime Administration Washington, DC 20590

Justification for Other Than Full and Open Competition

IAW FAR 6.303-2

05/24/2023

1. Identification of Agency and Contracting Activity

The U.S. Department of Transportation, Maritime Administration, HQ Contracting Office in Washington, D.C., proposes to enter into a contract, on a basis of other than full and open competition for the Associate Administrator for Strategic Sealift.

2. Nature and/or Description of the Action Being Approved

The Maritime Administration (MARAD) intends to award a new sole source, time and materials contract to Herbert Engineering Corporation (HEC) of Alameda, CA, to provide general technical support and quality assurance services to MARAD in support of MARAD's National Security Multi-Mission Vessel (NSMV) new training ship construction project and recapitalization efforts. These recapitalization efforts include constructing new training ships for assignment to the State Maritime Academies (SMAs). The support effort will build upon the design work already accomplished by the Contractor under Contract No.

DTMA91C1600014 and construction technical review under Contract No.

693JF718C000048.

3. Description of Supplies or Services

This requirement is to provide technical expertise and quality assurance services to MARAD, over a four-year period for an estimated cost of $1.3 million, to support the agency in connection with the NSMV new training ship construction project.

Part of MARAD's mission is to support the training and development of highly qualified entry- level U.S. Coast Guard Merchant Mariner Credential (MMC) officers with unlimited endorsements to maintain the nation's pool of skilled merchant mariners for economic stability and national security. To accomplish this, MARAD provides training ships to the U.S.

Merchant Marine Academy and all six State Maritime Academies (SMA) for use in at-sea training. The National Defense Reserve Fleet (NDRF) training ships are owned and administered by MARAD. The training ships are also periodically used for domestic and foreign emergency contingency operations, and to support other authorized uses.

The NSMV has been designed to accommodate a modular configuration increasing its capability for modern training of cadets/midshipmen in deck and engineering operations, and for flexibility in responding to national and international emergencies and disasters. HEC has worked closely with MARAD for the last eight years in identifying requirements, developing the NSMV new design, supplying technical oversight and review, and providing quality assurance during construction of all NSMVs. Based on these extensive activities, HEC is intimately familiar with both the initial design, training ship requirements, and the shipyard construction process. This has included engineering changes and design changes. This knowledge of NSMV provides unique contributions in this follow-on support.

HEC will be the lead technical advisor to MARAD for the NSMV construction project. HEC will provide the following critical efforts in ensuring the timely and technically accurate success of the project:

• Respond to MARAD questions and inquiries about training ship vessel design, features, capabilities, requirements and applicable regulations.

• Assist MARAD with responses to inquiries or assist with the development of information and reports to be provided to other entities, such as:

a. U.S. Department of Transportation and/or other federal agencies, state or local governments.

b. U.S. Congress.

c. State Maritime Academies and their respective States or State University systems.

• Provide technical expertise to MARAD on the training ship guidance design as well as vessel design developed by the shipyard.

• Provide technical expertise to MARAD regarding the construction of the NSMV.

• As directed by MARAD, provide for oversight inspection at the shipyard, subcontractor facilities, aboard the vessel during sea trials, and other locations associated with the vessel to give high level and detailed review of vessel construction progress and quality based on on-site inspections. Vessel construction includes, but is not limited to:

a. Overall workmanship and quality;

b. Structural installation and quality;

c. Equipment selection, installation, and performance;

d. System installation and performance;

e. Vessel operation, seakeeping, and performance.

• Monitor overall vessel construction progress and identify concerns where progress is not in accordance with published plans and schedules.

• Monitor vessel performance during the warranty period of each vessel. Identify, or validate identified, warranty deficiencies. Provide independent recommendations and/or validate VCM proposed corrections to correct warranty deficiencies.

• As directed by MARAD, develop configuration changes to the vessels post-delivery.

This shall include sketches, detail plans, updates to as-built drawings, updates to operating manuals, cost estimates, and regulatory body approvals, if required.

• Issue reports to MARAD on a monthly basis describing the ship construction progress, items inspected, issues of note, status of milestone events and upcoming events.

• Review for compliance with the contract specification, MARAD requirements, and good shipbuilding practice.

• Review drawings within the allowed time frame as specified in the ship construction contract and prepare drawing review forms for informing the Vessel Construction Manager and MARAD of the recommended approval action and any comments.

• Work with the Vessel Construction Manager through MARAD to close out comments based on shipyard responses.

• Keep records of status of approval actions and periodically advise MARAD of the status which includes tracking recommended changes and comments to submitted drawings and documents and validating incorporation or reconciliation of changes and comments.

These efforts will be accomplished by providing subject matter expertise relating to: the NSMV design; commercial ship construction contracting and practices; attending meetings and making recommendations; reviewing and commenting on documents; assisting MARAD in responding to various inquiries from third parties; preparing status reports; and conducting design assessments, value engineering, advanced calculations, and analysis.

A complete Statement of Work is provided as attachment 1.

4. The statutory authority permitting other than full and open competition

The statutory authority permitting other than full and open competition is,41 U.S.C.253(c)(1)(or 10 USC 2304(c) (1)) as implemented by the Federal Acquisition

Regulation (FAR) Subpart 6.302-1 entitled, "Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements."

5. A statement demonstrating the unique qualifications of the proposed contractor or the nature of the action requiring the use of the authority

HEC is uniquely qualified to provide these services to MARAD due to the following:

HEC is a highly regarded and competent Naval Architecture and Marine Engineering Design firm. HEC specializes in developing initial concept and contract designs of commercial vessels. Beyond ship design, HEC provides quality assurance oversight to commercial ship owners during vessel construction and liaison to regulatory bodies. HEC is the principal naval architecture and marine engineering firm awarded contract DTMA91C201500005 for Phases 1and 2, and DTMA91C201600014 for Phase 3 of the NSMV Concept Design under an Architect-Engineer Brooks Act contract. They were also awarded contract No.

93JF718C000048 for construction technical review. The previous work with MARAD and its stakeholders over the past eight years has allowed HEC to develop a full appreciation of all the project requirements and limitations. They have developed a unique knowledge set which will be leveraged in order to optimize the concept design, maximize capabilities, and minimize lifecycle costs. HEC was selected for the initial concept design contract after a review of eight (8) qualification packages received in response to the A&E Presolicitation Notice.

HEC possesses a thorough understanding of the reasons and rational behind all previous decisions made in the optimization of the original design phases and their demonstrated performance. HEC was initially deemed most qualified over seven other design firms for Phases 1 and 2 based on their qualifications, technical presentation, and the team proposed. As the initial design agent, HEC has developed this concept design from the keel up. They have all the historical knowledge supporting the basis of the concept design to date and fully comprehend the reasoning behind aspects of the design. They have conducted global vessel searches and developed NSMV initial design plans that would successfully meet the NSMV requirements. In FY 2016, a sole source contract (DTMA91C201600014) was awarded to HEC to accomplish Phase 3 of the NSMV concept design based on their historical knowledge gained during Phases 1 and 2. HEC has worked closely with the SMAs and MARAD to refine the requirements for the design. HEC was able to provide specific information regarding design changes and the impacts on the requirements, costs, and production schedules; this information was critical for MARAD management's assessments to reach consensus with all stakeholders for the basic design of the NSMV. As this effort progresses, SMA specific requirements become increasingly critical to the design. In 2018, HEC was awarded a sole source contract (693JF718C000048) to provide technical review, assessments, and evaluation support to MARAD during the construction of the NSMV. HEC has since provided monthly onsite shipyard visits to review construction progress and provide schedule assessments to MARAD. They have also provided drawing reviews and technical reviews of engineering changes. HEC has continued to work with MARAD and the SMAs to refine and create drawings for operational spaces and future equipment outfitting. HEC’s prior expertise on this program has been leveraged to assist MARAD with a clear understanding of the shipyard’s schedule and design progress. Continuing under a different contractor would result in lost knowledge and the need for a new contractor to expend time and resources to gain this previously acquired knowledge base of not only the vessel design but also the shipyard’s construction approach and processes.

6. Potential Sources

Based on the aforementioned, soliciting from additional sources is not practicable at this time.

This Justification for Other Than Full and Open Competition (JFOTFOC) will be posted to SAMs as required by FAR 6.305(d).

7. Fair and Reasonable Cost

The anticipated cost to the Government will be determined to be fair and reasonable based on the Independent Government Estimate (Attachment 2) developed by the Program Office, prices paid for the same or similar services, and other available information.

8. Market Research

New market research was not conducted for this requirement. As a follow-on contract, this requirement is for the continuation of technical expertise previously provided by the proposed contractor and no new questions have arisen regarding the qualifications or abilities of the proposed contractor or the scope of the requirement. Market research would not have revealed additional sources that would be able to meet this requirement without the duplication of costs and unacceptable delays as discussed below.

9. Other Supporting Facts

This will be a follow-on contract for continued technical expertise during the execution of the NSMV new training ship construction project based on the development of the NSMV initial design and previous technical expertise provided by HEC. Award to a new contractor will result in a duplication of cost to the Government that is not expected to be recovered. If a new firm was solicited for, it is anticipated, there would be a minimum of four months lost time in the procurement process to identify a potential candidate. Additionally, the specialized knowledge developed during Phase 1, 2, and 3 and during the construction period are non-transferrable and would require additional cost and revalidation efforts. The additional contract cost to the Government is estimated at $525,549 and an additional three to seven months of contract performance time would be required for the new firm to review the extensive data developed in Phase 1, Phase 2, Phase 3, and the construction phase. The new firm would incur additional travel expenses to the shipyard and subcontractor facilities to establish baseline knowledge of the requirements and construction progress to date.

Additionally, a new contractor would impose unnecessary risk on the Government for any calculations and estimates previously conducted by HEC firm during Phases 1, Phase 2, and Phase 3. A new contractor would be required to revalidate calculations and estimates utilizing their own processes resulting in duplicative costs and time wasted. This estimated additional cost (rework) is based on the complexity and quantity of the work performed during each phase of design and the required effort to review and validate this work, which is reflected as ten percent of the HEC estimate for Phase 1, fifteen percent of the HEC estimate for Phase 2, at least twenty-five percent of the HEC estimate for Phase 3, additional travel costs for contractor to review shipyard and subcontractor facilities and construction progress, and government staff time to educate a new contractor on facets of the design. Details of this additional cost are outlined here.

Duplication of Effort Estimate Initial HEC Rework Costs Estimate

Phase 1 Review $253,000 $25,300 Phase 2 Review $235,000 $35,250 Phase 3 Review $1,750,654 $437,664 Travel Costs $25,000 $12,000 Government Staff Time* $15,335 Total Cost for Duplicated effort $525,549

*Fully burdened Government staff time is based on 120 hours of GS-15, Step 8 @ $88.22 (Washington, DC, region) plus 32.85% fringe benefits and 12% overhead.

10. Interested Sources

No sources have expressed an interest, in writing, in this acquisition. There have been two widely attended, public industry presentations that noted a role for a contracted owner's representative for quality assurance and technical review of the shipyard and construction manager's work.

11. Agency Actions taken to Overcome Sole Source Scenario

This contract is for technical expertise and quality assurance services in connection with the delivery of the new National Security Multi-Mission Vessel. Although a new firm could provide the services required by the Statement of Work, the Federal Government would ultimately pay for duplicative efforts and lose valuable time required for on-time delivery of the aging training ship.

12. Contracting Officer's Certification The information presented above is accurate and complete to the best of my knowledge and belief.

Ken Egbuna (Esq.) Date Sr. Contracting Officer

The description of the services being required and qualifications of the proposed contractor is complete and accurate to the best of my knowledge and belief.

Approval:

Brett Scrum Date MARAD Competition Advocate

Attachment(s)

(1) Statement of Work

(2) Independent Government Cost Estimate