Justification Duramax Marine Parts Buy 70Z08020Q12002B00.pdf

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SOLE SOURCE JUSTIFICATION

For Certain Commercial Items for Procurements Exceeding the Simplified

Acquisition Threshold pursuant to FAR Subpart 13.5, Including Brand Name

RFQ Number: 70Z08020Q12002B00

Pursuant to the authority of 41 U.S.C. 1901 as implemented by Federal Acquisition

Regulation (FAR) Subpart 13.501 and consistent with the content requirements of FAR

6.303-2, the following facts and rationale support this justification.

1. Agency and Contracting Activity: The Department of Homeland Security, United States Coast Guard (USCG), Surface Forces Logistics Center (SFLC), Contracting and Procurement Division (CPD), 2401 Hawkins Point Road, Baltimore, Maryland 21226.

2. Nature and/or Description of the Action being Approved: The Surface Forces

Logistic Center (SFLC) anticipates awarding a sole source contract to procure proprietary Original Equipment Manufacturer (OEM) propulsion shaft stave bearings. These parts will be used to support the 154’ WPC Coastal Patrol

Cutters.

The period of performance will be in effect for one year from date of award. The

USCG intends to award a firm fixed price contract using FY’20 Operations and

Support funds. The proposed contract is expected to be awarded to the original equipment manufacturer, utilizing the procedures established under FAR part 12

Acquisition of Commercial Items in conjunction with FAR Part 13.5 Simplified

Procedures for Certain Commercial Items. The Independent Government Estimate

(IGE) including a list of parts is attached. The OEM and prospective contractor for this procurement is:

Duramax Marine LLC

Independent Government Estimate

CLIN

NO.

Description PART

NUMBER

EST.

ANN

QTY

U/I

Parts Kit, Bearing

Replacement, FRC-B Shaft

Forward Stave Bearing, External

80920203000004

EA

0002 Parts Kit, Bearing

Replacement, FRC-B

80920203000003 020 EA

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Propeller Shaft Forward or

Aft Romor Stave Bearing

0003 Parts Kit, Bearing

Replacement, FRC-B

Propeller Aft Stave

Bearing Split, External

80920203000005 026 EA

3. Description of Supplies/Services: This requirement has been designated as a supply because the primary purpose of the requirement is to furnish an end item of supply. These parts are considered commercial items. The parts will be shipped to the SFLC Warehouse for storage and ready issue to the fleet or will be direct shipped to various USCG cutters and units when required. The propulsion shaft stave bearings are used to allow rotation of the propulsion shafting while transmitting rotational torque from the main engine reduction gears to the propeller. This action allows for vessel propulsion. These bearings are critical to the operation of these vessels to complete their mission. Since the 154’ WPC vessels operate in all weather conditions and sea states throughout the world, these propulsion shaft stave bearings are critical to the vessels meeting their operational requirements. The parts associated with contract are as follows:

CLIN DESCRIPTION

PART

NUMBER

QTY

U/I

Parts Kit, Bearing Replacement, FRC-B Shaft Forward Stave

Bearing

80920203000004

Parts Kit, Bearing Replacement, FRC-B Propeller Shaft Forward or

Aft Romor Stave Bearing 80920203000003 020

Parts Kit, Bearing Replacement, FRC-B Propeller Aft Stave Bearing

Split, External 80920203000005 026

4. Identification of Statutory Authority Permitting Other Than Full and Open

Competition: The statutory authority permitting other than full and open competition is 41 U.S.C. 1901 implemented by FAR Subpart 13.5, Simplified

Procedures for Certain Commercial Items.

5. Identification of Exception to the Buy American Statute: The Buy American

Act does apply, since this will be a supply contract that exceeds the micro-purchase threshold. The OEM is located in the USA, so the Buy American Act requirements are expected to be met.

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6. Demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited: The DeAngelo

Marine LLC propulsion shaft stave bearings listed in this requirement are commercial items designed and manufactured by Duramax Marine LLC. Each propulsion shaft bearing was procured as a whole and was originally described as such by the Government. Procurement was not based on Government specified descriptions of all of the various components contained within; and the

Government has not bought those descriptions from Duramax Marine LLC, Inc.

Other than basic part/component descriptions (part numbers, etc.) provided by

Duramax Marine LLC, Inc., the Government does not possess descriptions adequate for procuring all the various components full and open.

OEM parts must be used or the Government will be harmed. The use of parts not manufactured in accordance with OEM specifications, materials, tolerances etc.

could cause equipment failure rendering the vessel unable to complete mission requirements. In order for the cutters to meet their mission requirements the

Coast Guard must maintain an aggressive parts purchasing program. It is imperative that the Coast Guard work in partnership with the OEM, Duramax

Marine LLC, Inc., in providing parts to keep these vessels at their original operating capability. The actual equivalency of any non-Duramax Marine LLC propulsion shaft bearing is not known, may not be easily determined, and the risk of accepting those propulsion shaft stave bearings without fully vetting their equivalence is unacceptable and may result in excessive cost to the Government, reduced reliability, reduced safety, and may hamper the Coast Guard mission requirements. The introduction of other manufacturer’s propulsion shaft stave bearings will also require technical publication storage and management, separate spare propulsion shaft stave bearings which would increase warehouse space usage and storage fees. It is not uncommon for these vessels to experience heavy seas and extreme weather during normal operations. In these conditions, these vessels and crew are exposed to various conditions that could make their duties and environment unsafe or extremely difficult. The Duramax Marine LLC, Inc.

propulsion shaft stave bearings were designed and tested to meet the vessel manufacturer requirements and specifications at the time of vessel construction.

The failure of any of propulsion shaft stave bearings could cause the failure of the vessel propulsion system. This failure would affect vessel movement. Since the

154’ WPC vessels operate in a wide variety of weather and sea state conditions and in close proximity of other vessels or fixed objects loss of propulsion could be catastrophic, loss of property or damage to the environment.

All reproduction manufacturing drawings, specifications, and other technical data pertaining to the propulsion shaft stave bearings were not available during vessel construction, and are not available for use by the Coast Guard now. The Coast

Guard does not possess parts manufacturing data required to obtain full and open competition. Further, the scope of manufacturing, special tools and equipment required to manufacture the propulsion shaft stave bearings are unknown. The technical data that is needed is proprietary. Without the adequate data, the Coast

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Guard is not capable of evaluating equal or alternate propulsion shaft stave bearings manufactured by other than the OEM. The use of OEM propulsion shaft stave bearings will insure components and processes are sufficient to enable physical and functional interchangeability, as well as meeting source, size, and configuration and performance requirements. On 4/21/20 the SFLC Patrol Boat

Product Line emailed Duramax Marine LLC, inquiring as to the ability to purchase proprietary technical data for use in full and open competition.

Company responded on 4/21/20 that the data was proprietary and therefore not available. A copy of the email is included with this procurement package.

7. Description of Efforts Made to Ensure That Offers are Solicited from as

Many Potential Sources as is Practicable: In accordance with FAR Subpart

5.203, in an effort to solicit as many potential sources as practicable, a sources sought notice was published on beta.SAM.gov on April 28, 2020-May 1, 2020 that informed industry that it is the Government’s belief that Duramax Marine

LLC propulsion shaft stave bearings are only available from Duramax Marine

LLC the OEM, unless other sources could provide verification of their capabilities to provide these parts. This announcement yielded one response from the source listed below:

The requirement was published in the Acquisition Planning Forecast System

(hereafter APFS) on May 5, 2020. The APFS number is F2020050269.

8. Determination by the Contracting Officer that the Anticipated Cost to the

Government Will Be Fair and Reasonable:

The Contracting Officer anticipates that the cost to the Coast Guard will be fair and reasonable based on comparisons with historical pricing, the Independent

Government Estimate, require other than certified pricing data, and price negotiations.

9. Description of Market Research: Market research was conducted by the

Contracting Officer’s Representative (COR) and Contract Specialist (KS) in April

2020 in an effort to identify companies that can provide the requested propulsion shaft stave bearings. Market research was conducted by looking at various companies, parts and components on the internet, available companies through

Federal Supply Schedules, and companies that have had previous contracts.

There are no other known distributors other than Duramax Marine LLC, Inc. that can provide the propulsion shaft stave bearings required in this contract. Since the proprietary data required for manufacturing the Duramax Marine LLC propulsion shaft stave bearings is not made available to the public, the government will not be able to determine if other than OEM propulsion shaft stave bearings are authentic, after market or were manufactured in accordance with Duramax Marine LLC, specifications, materials, tolerances or standards. It would not be possible for a third party to provide authentic Duramax Marine

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LLC, propulsion shaft stave bearings without the OEM's proprietary information or purchasing directly from the OEM itself.

10. Any Other Facts Supporting the Use of Other Than Full and Open

Competition: The Item Manager, Equipment Specialist and Contracting teams have on a regular basis procured propulsion shaft stave bearings used on the 154’

WPC vessels under the Simplified Acquisition Procedures (SAP) Section. These requirements have all been Sole Source due to the need for conformity and the

USCG’s operational requirements. At the time these purchases are required

Duramax Marine LLC is engaged and requested to provide their proprietary data including on 4/21/2020 as indicated above. Duramax Marine LLC, Inc. has denied each request. Duramax also confirmed they have no OEM dealers who would provide a quote in response to the upcoming solicitation.

11. A Listing of the Sources, if Any That Expressed, in Writing, an Interest in the Acquisition: The following companies responded to the sources sought notices posted for this acquisition and are expected to be able to meet this requirement:

12. A Statement of the Actions, if any, the Agency May Take to Remove or

Overcome Any Barriers to Competition Before Any Subsequent Acquisition for Supplies or Services are Required: Due to the fact the Coast Guard does not own the required drawings, specifications or technical data etc. to evaluate other than the OEM propulsion shaft stave bearings and it is unlikely Duramax Marine

LLC, Inc. will sell the data rights to the Coast Guard, it is not anticipated any future requirements will be full and open competition. The COR will engage the

Coast Guard SFLC Patrol Boat Product Line Command to request funding to reverse engineer the propulsion shaft stave bearings to obtain drawings that can be used for future manufacture.