Justification for Other than Full and Open Competition for B4T Redacted SAM.pdf

JUSTIFICATION AND APPROVAL FOR OTHER THAN FULL AND OPEN COMPETITION (J&A)

TO: , Contracting Officer, USAID/WBG

CC: , Agency Competition Advocate

FROM: , , Office of Economic Growth, Natural Resources and Infrastructure (EGNI), USAID/WBG

RE: USAID/WBG Construction Services / Build 4 Tomorrow

SUBJECT: Justification and Approval for Other than Full and Open Competition (J&A)

1. This document sets forth the facts and rationale justifying the use of other than full and open competition.

This document was prepared by the Economic Growth, Natural Resources, and Infrastructure Office (EGNI), USAID/WBG pursuant to the authorities under the Expedited Acquisition and Assistance Procedures (EPP) for West Bank and Gaza, approved on January 11, 2024, to provide justification for the use of other than full and open competition for the award of the Build 4 Tomorrow (B4T) Indefinite Delivery, Indefinite Quantity (IDIQ) contract. B4T is a seven year IDIQ (five year ordering period plus two years implementation period), with a shared ceiling of $500,000,000. Your approval of this Justification and Approval (J&A) constitutes the justification for other than full and open competition as required by Tab 1 (Determination and Findings (D&F) Authorization for the Use of Other than Full and Open Competition of Contracts) of the EPP.

RECOMMENDATION

It is recommended that you approve this justification for use of other than full and open competition pursuant to the Action Memorandum “Expedited Acquisition and Assistance Procedures (EPP) for West Bank and Gaza”, approved on January 11, 2024. Your approval of this J&A constitutes the justification for other than full and open competition as required by Tab 1 (D&F Authorization for the Use of Other than Full and Open Competition of Contracts) of the EPP.

2. The nature and/or description of the action being approved:

This request seeks approval to award follow-on services under the B4T IDIQ to the four holders of its preceding Building Foundations IDIQ contract holders, namely: CDM Constructors Inc; The Morganti Group Inc.; Blumont Engineering Solutions; and APCO-ArCon LLC. Under this action the four contractors will continue to provide a full range of multidisciplinary construction services to execute medium-to-large scale infrastructure activities in the West Bank, Gaza, and East Jerusalem. The estimated overall shared ceiling for the B4T IDIQ is $500,000,000. In accordance with FAR 16.505(b), all IDIQ holders will be provided a fair opportunity to be considered for each subsequent order exceeding the micro-purchase threshold through the Request for Task Order Proposal (RFTOP) process.

3. Description of the supplies or services required, including an estimated value:

The purpose of the B4T multiple award IDIQ contract is to obtain the services of qualified U.S.

construction firms to implement Task Orders for the construction of infrastructure in the West Bank, Gaza, and East Jerusalem. This IDIQ contract includes a full range of multidisciplinary construction services across all sectors to support USAID/WBG in its efforts to build thriving Palestinian communities, promote inclusive development, and advance a two-state solution.

The construction services under this IDIQ contract are defined as the construction, rehabilitation, alteration, conversion, extension, repair, or improvement of physical infrastructure related to, but not limited to, the following:

Water security infrastructure;

Solid waste management infrastructure;

Vertical structures;

Traffic management infrastructure;

Climate change infrastructure;

Economic development infrastructure;

Humanitarian emergency response interventions to address both manmade and natural crises;

Design-Build and/or Design-Build-Operate-Transfer infrastructure;

USAID-identified procurements necessary to uphold USAID objectives; and Any additional infrastructure construction activities of a similar nature that may arise to advance USAID development objectives in response to the dynamically changing political landscape.

B4T is a seven year IDIQ (five year ordering period plus two years implementation period), with a shared ceiling of $500,000,000. Funding will be obligated under separate Task Orders.

4. Statutory authority permitting other than full and open competition:

AIDAR 706.302-70(b)(3)(ii) and 40 U.S.C.§113(e)(2); see “Expedited Procedures Package for West Bank and Gaza,” January 11, 2024. The D&F is attached to this file in Tab 1. The EPP can be used to allow the Agency to respond quickly and effectively to meet critical needs in USAID’s West Bank and Gaza programming.

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

The B4T multiple award IDIQ contract represents the most recent iteration following three USAID/WBG construction services multiple award IDIQ contracts, which the USAID/WBG has consecutively awarded since 2008. The three preceding IDIQ construction contracts, spanning more than 15 years, had a comparable scope and scale to the B4T IDIQ, as outlined below:

Moreover, and despite the unprecedented security situation in the West Bank and Gaza, these contractors demonstrated their ability to implement projects during heightened security conditions.

The events of October 7 and the subsequent Gaza war fundamentally altered the landscape, risks, and complexities of project execution in the West Bank and Gaza. This underscores the pressing need for partnerships with contractors who possess extensive experience in navigating implementation challenges and have a thorough understanding of the USAID/WBG requirements, as well as the unique local requirements. Such contractors must also have established networks with relevant authorities and a roster of locally certified local subcontractors to ensure seamless execution. This is crucial to prevent significant implementation delays and additional costs that could jeopardize foreign aid programs. The Building Foundations IDIQ holders garnered over fifteen years of on-the-ground presence in the WBG, equipping them with the unique expertise to execute projects in the WBG efficiently and at competitive rates.

During periods of relatively stable security conditions, these contractors were consistently the companies expressing interest and meeting qualification criteria. Considering the current heightened security risks, it is unlikely that additional contractors would understand the context and seek to express interest in the B4T IDIQ contract.

- The period during which USAID/WBG intends to solicit the B4T Program presents a highly challenging period of insecurity and constantly changing operational context. Contractors lacking experience operating in WBG and without a physical presence are, as stated above, unlikely to express interest in submitting proposals. If they do, their proposals would most likely include a lack of understanding and present higher risk margins, which would result in substantial additional costs to the Government.

- Contractors lacking demonstrated experience with the unique requirements of USAID/WBG and the specific local regulations may encounter implementation delays or challenges, jeopardizing successful project completion. New contractors would either require additional time to establish connections and become acquainted with these intricacies or risk overlooking critical requirements. Both scenarios would result in detrimental consequences for USAID/WBG programming. Delays in project execution translate to additional financial and reputational costs to the Agency. Overlooking critical requirements could strain USG relations with local authorities and/or diminish USAID results.

- Contractors without prior experience in navigating the unique challenges of implementing projects in the WBG may struggle to effectively plan and address risks promptly. This could lead to either higher implementation costs or project delays, both of which would increase risks to USAID/WBG and the Agency.

Furthermore, this IDIQ primarily targets medium-to-large-scale and complex infrastructure projects that surpass the capabilities and capacities of local contractors, both financially and technically. USAID/WBG has an active contract specifically dedicated to small-scale infrastructure activities with a local firm.

Finally, the U.S. Government (USG) urgently needs to scale up its humanitarian assistance and development assistance in order to pivot and mitigate the impacts of the humanitarian, political, and economic crisis currently unfolding in Gaza and the West Bank, while also preparing for needs upon a cessation of violence. Successful implementation of development programming in this rapidly fluctuating environment requires USAID to expedite its normal planning and competitive award processes. To ensure that USAID/WBG is poised to respond as effectively as possible, a new construction services IDIQ needs to be awarded prior to September 30, 2024. In accordance with ADS 303.3.3, the procurement action lead time to award an IDIQ is 327 days, well beyond the current Fiscal Year. Proceeding with a full and open competition under these circumstances will unnecessarily strain Agency resources and increase the risk that USAID will be unable to execute its planned objectives as envisioned. This is a risk to USAID/WBG programming and impedes the advancement of USG strategy in the region.

6. Description of the efforts made to ensure that offers are solicited from as many potential sources as practicable, including whether a notice was publicized as required by FAR 5.2

[AIDAR 705.2].

Publication of a notice is not required per the determination at AIDAR 705.202(b) as it is not practical under the circumstances. As described above, due to the immediate need for USAID/WBG to scale up its humanitarian assistance and development programming, and pivot to mitigate the impacts of the humanitarian, political, and economic crisis currently unfolding, it is not practicable to solicit offers from potential sources.

7. A determination by the Contracting Officer that the anticipated cost to the Government will be fair and reasonable:

For each Task Order issued under the B4T IDIQ contract, an independent government cost estimate (IGCE) will be prepared by USAID independent Architectural and Engineering firm and validated by the USAID Activity Manager (Engineer) prior to issuing any RFTOP. The IGCE provides a basis for assessing the reasonableness and fairness of the price proposals received from the B4T IDIQ contract holders. Additionally, each proposal received in response to a Task Order will be reviewed by the price evaluation committee in accordance with FAR 15.404-11, utilizing the following techniques to ensure that the awarded task order’s prices are fair and reasonable:

Comparison of proposed prices received in response to the solicitation; in accordance with 15.403-1(c)(1)(i) – adequate price competition establishes a fair and reasonable price;

Comparison of proposed prices with independent Government cost estimates;

Comparison of the proposed prices to historical prices paid, whether by the

Government or other than the Government, for the same or similar items;

Comparison of proposed prices obtained through market research for the same or similar items;

Review of the unit prices in accordance with FAR 15.404-1(f); and Review of Unbalanced Pricing in accordance with FAR 15.404-1(g).

8. Description of the market research conducted, and the results or a statement of the reasons market research was not conducted:

There is no new market research. B4T IDIQ contract represents the fourth generation of construction services IDIQs at USAID/WBG. Over the last fifteen years, the preceding IDIQ contracts revealed sustained interest and performance from the same contractors: CDM Constructors Inc., The Morganti Group Inc., Blumont Engineering Solutions, and APCO-ArCon LLC.

Given the historical trends, no new market research was deemed necessary to expeditiously procure these services. EGNI will conduct new market research during implementation of B4T;

this will inform a full and open, competitive procurement process for any follow-on construction services.

9. Other facts supporting the use of other than full and open competition:

In addition to the risks outlined in Section 5 above, awarding the B4T IDIQ to continue construction services would allow USAID/WBG to continue current projects unimpeded.

- Full and open competition of B4T IDIQ. Conducting full and open competition for the B4T IDIQ, in line with ADS guidelines requires a PALT of 327 days. This option poses a significant risk to the USAID/WBG’s ability to obligate the $25 million of water earmark funds before their expiration on September 30, 2024.

10. Sources, if any, that expressed an interest, in writing, in the acquisition:

Publication of a notice is not required per the determination at AIDAR 705.202(b), as it is not practical under the circumstances.

11. The actions the Agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required:

USAID/WBG intends to conduct a competitive procurement for construction services once the B4T IDIQ expires. It is anticipated that, by that time, the funding levels for USAID/WBG would have stabilized, and the security and political situation would be improved in order to facilitate a robust competition to attract new contractors.

12. Technical or Requirements Personnel Certification:

In accordance with FAR 6.303, I hereby certify that the technical statements included above and which form a basis for the justification are complete and accurate and in accordance with EPP entitled Expedited Acquisition and Assistance Procedures (EPP) for West Bank and Gaza, approved on January 11, 2024 (attached Tab 1- EPP D&F for the Authorization for use of Other than Full and Open Competition of Contracts).

, EGNI, USAID/WBG Date

13. General Counsel /RLO Clearance:

Date

14. Contracting Officer Certification:

In accordance with FAR 6.303, I hereby certify that the justification is accurate and complete to the best of my knowledge and belief and in accordance with EPP entitled Expedited Acquisition and Assistance Procedures (EPP) for West Bank and Gaza, approved on January 11, 2024 (attached Tab 1- EPP D&F for the Authorization for use of Other than Full and Open Competition of Contracts).

Contracting Officer, USAID/WBG Date

Tab 1: Expedited Procedures Package (EPP) for the West Bank and Gaza