L0WC07 Cold Roll SSJ_signed Redacted.1.pdf

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

FOR OFFICIAL USE ONLY

25 May 2018 FOR OFFICIAL USE ONLY Page 1 of 5

NOTE: If a Justification was approved for the preceding acquisition, a copy of the approved Justification for the predecessor action must be included in the staff package for approval of the instant Justification. This applies to Justification staff packages that are submitted for review and approval at a level above the contracting officer. The predecessor Justification will be used as a reference document by the approving official.

Is this a new or amended J&A Document? New Amended ( Prior to Award Only! )

Is this a Bridge Action as defined in the AF Bridge Action Reduction Plan? Yes No

Funding level for this acquisition:

Contracting Activity: AFSC/PZIMA

Purchase Request / Local ID Number: FY20 CIP L0WC07

Program / Project (and PE, if applicable): Cold Roll Machine

Program Type (PEO or Other Contracting): Other Contracting

Authority: AFFARS 5313.501 - 10 U.S.C. 2302b, Implementation of Simplified Acquisition Procedures (41 U.S.C. 1901)

AFFARS 5313.501 - 10 U.S.C. 2304a, Special Emergency Procurement Authority (41 U.S.C. 1903)

Estimated Contract Cost (including options): Justification Type: Class Individual

COORDINATION (AFFARS 5306.304(a) )

Date

20 Mar 2020

Signature

Date

06 Mar 2020

APPROVAL (AFFARS 5306.304(a) )

Date

03 Apr 2020

Contracting Officer

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

25 May 2018 FOR OFFICIAL USE ONLY Page 2 of 5

I. Contracting Activity.

The contracting activity for this requirement is Air Force Sustainment Center (AFSC)/PZIMA.

II. Nature and/or description of the action being processed.

Due to the circumstances described herein, the activity requests authority to acquire one (1) automated cold roll machine required to automate cold rolling of the model 54H60 C-130 propeller blade using Other Than Full and Open Competition as prescribed by FAR 13.5, simplified Procedures for Certain Commercial Items. This action will result in the award of a new, commercial definitive supply contract which will be Firm Fixed Price

(FFP).

This sole source requirement will be purchased from the following company:

Kredit Automation & Controls, Inc.

252 S El Dorado Cir.

Mesa AZ 85202-1044

CAGE Code: 1YL40 Woman-Owned Small Business

III. Description of supplies/services required to meet agency needs.

Under the contemplated contract, an Azurite Engineering vendor will provide one (1) automated cold roll machine required to automate cold rolling of the model 54H60 C-130 Propeller Blade.

Statutory authority permitting other than full and open competition.

AFFARS 5313.501 - 10 U.S.C. 2302b, Implementation of Simplified Acquisition Procedures (41 U.S.C. 1901)

V. Demonstration that the contractor's unique qualifications or nature of the acquisition requires the use of the authority cited above (applicability of authority).

Azurite Engineering, Inc. is the only manufacturer that can satisfactorily meet the need for providing an Automated Cold Roll System to perform cold rolling operations on the shank of the 54H60 C-130 propeller blade without substantial duplication of engineering costs and design/certification delays. The cold rolling process is a highly controlled and specialized process where a hardened steel roller imparts 900 lbs. of force to the surface of the aluminum. This increases the compressive stresses in the material allowing it to better withstand stress and reduce the possibility for cracks to form or continue to grow. Cold rolling is considered a flight safety critical process to the C-130 System Program Office, and it is essential to have a consistent, repeatable process to support the overhaul of the prop blades. There are several critical variables which could alter the amount of residual stress imposed into the retention fillet including the following: roller bearing geometry, roller bearing material, roller bearing hardness, RPM range, RPM controllability, load control, and load indication process.

Prior to 2017, only 10% of the propeller blades required the cold rolling process. If the production requirement for props were 35 props per month (140 blades per month), only 14 of the 140 blades would require cold rolling. After a mishap in the summer of 2017, an independent review team, in association with the C-130 System Program Office, determined that all blades, 100% of the fleet, would require the cold roll process (TO 3H1-18-3S-8, Page 29, Figure 2-27A). This is a 900% increase in cold rolling requirements for C-130 blades.

Currently there are over 200 backorders for the required propeller blades. A second cold roll machine is needed

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

25 May 2018 FOR OFFICIAL USE ONLY Page 3 of 5 urgently both to expand capacity and to eliminate a single point failure in production of these safety-critical parts.

Azurite Engineering has been developing automated 54H60 propeller blade cold roll equipment for the Air Force and private entities since 1996. The cold rolling process developed by Azurite is custom designed and unique to Robins AFB production, as Robins is currently the only ALC providing cold rolling operations for the 54H60 C-130 propeller blade.

Additionally, military certification would be required for another vendor's equipment. Azurite has obtained FAA/JAA and military certification for their equipment. To obtain this certification, Azurite Engineering was required to provide 10 cold-rolled coupons.

Additionally, the time to develop an alternate cold rolling machine is estimated to take 12 months at a minimum, plus another 6 months for military certification.

As such, to develop another source to produce a cold rolling machine would duplicate over in engineering, design, and certification costs and result in an 18-month delay to procure the required equipment.

The design for the equipment, hardware, software programming, and adapters is proprietary to Azurite Engineering, and Azurite is not willing to sell or release the data to the government nor any other vendor (see attached Proprietary Letter).

The C-130 System Program Office requires that we maintain consistency in equipment in order to maintain a reliable, repeatable process and configuration control of the 54H60 propeller. As per the attached email correspondence dated 7 Feb 20 from the C-130 System Program Office, it is crucial to standardize the machinery used in the production of these propeller blades. The required cold roll machine must exactly mirror the existing machine and upgraded controls already in use, as this would ensure consistency and allow the operators to isolate any faults that arise in the production process. Using another vendor's product would necessitate the procurement of two identical cold roll machines to replace the existing Azurite equipment.

In conclusion, use of a manufacturer other than Azurite would sink in excess of $800K in non-value-added cost duplications (a 200% increase) as well as add 18 months to the procurement lead time for this urgently needed asset. For the reasons stated above, a sole-source award to Azurite, via their sole authorized distributor Kredit Automation & Controls, represents the most cost-effective, expedient route for this acquisition.

VI. Description of efforts made to ensure that offers are solicited from as many potential sources as practicable.

This requirement will be synopsized on Federal Business Opportunities (Fed-Biz-Opps) as required by FAR

5.201. It is anticipated that sources having an interest in subcontracting may be identified through synopsis.

Although the Government does not own data to support acquisition of the item listed in section III from any other source, any source who responds to the Government as a result of this synopsis will be identified to the prime contractor as a potential for subcontracting possibilities.

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

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VII. Determination by the Contracting Officer that the anticipated cost to the Government will be fair and reasonable.

This acquisition will follow procedures of FAR 13.5, "Simplified Procedures for Certain Commercial Items." The overall cost of this acquisition will be negotiated in accordance with procedures in FAR Part 12 and FAR 13.106-3(a)(2), and a statement of price reasonableness ensuring the ultimate price to the Government is fair and reasonable. Additional pricing methodologies to negotiate fair and reasonable pricing may include reviewing publicly offered catalogs, comparison to historical contractor sales, and/or analysis of limited cost and pricing information provided by the contractor. In the event that limited cost and pricing information is made available, the Government's negotiation objective will be developed using local technical analysis and direct and indirect rate factors recommended by the Defense Contract Management Agency (DCMA).

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

Market research was conducted in accordance with FAR part 10 and was finalized on 9 Mar 20. Internet queries of Thomasnet and the Dynamic Small Business Search (DSBS) were conducted but identified unrelated cold rolling applications, primarily large cold rolling mills for manufacturing steel plate and bar stock, not the customer propeller blade application sought (see attached queries). NAICS code 333519, Rolling Mill and Other Metalworking Machinery Manufacturing, is applicable to this requirement. A Request for Information was posted to SAM.gov from 30 Dec 19 to 24 Jan 20 (Notice ID L0WC07) to survey the market for potential vendors. Only Kredit Automation & Controls, Azurite's authorized vendor, responded to the RFI; Azurite does not sell direct to the government and as such did not respond directly. KAC's response, which included a rough-order-of-magnitude estimate, was found technically acceptable by the government project engineer.

IX. Any other facts supporting the use of Other Than Full and Open Competition.

None

X. List of any sources that expressed, in writing, an interest in the acquisition.

No other sources responded to the RFI or expressed an interest in the acquisition.

XI. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before making subsequent acquisitions for the supplies or services required.

The Government will monitor the market for changes that might allow for future competitive acquisitions. In the event that the system program office approves an alternative to the equipment currently in use, or technology changes allow for a suitable alternative, the Government will prepare future requirement descriptions suitable for competition.

XII. Certification by the Contracting Officer.

As evidenced by my signature above, I have determined this document to be both accurate and complete to the best of my knowledge and belief.

Sole Source (Including Brand Name) Justification - Simplified Procedures for Certain Commercial Items

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XIII. Certification by the technical/requirements personnel.

As evidenced by my (our) signature(s) above, I (we) certify that any supporting data contained herein, which is my (our) responsibility, is both accurate and complete.