LSJ.pdf

DEFENSE LOGISTICS AGENCY

HEADQUARTERS

8725 JOHN J. KINGMAN ROAD

FORT BELVOIR, VIRGINIA 22060-6221

LIMITED-SOURCES JUSTIFICATION

1. IDENTIFICATION OF THE AGENCY AND THE CONTRACTING ACTIVITY

Requiring Activity Defense Logistics Agency (DLA) Information Operations Fort Belvoir (J62BGB) 8725 John J. Kingman Road Fort Belvoir, VA 22060-6221 Point of Contact: Ms. Lisa Saulsbery Telephone: (703) 767-9596

Contracting Activity DLA Contracting Services Office Energy (DCSO-F) 8725 John J. Kingman Road, Suite 1145 Fort Belvoir, VA 22060-6220 Point of Contact: LCDR Jackie Hurse, USN, SC Telephone: (703) 767-0468

2. NATURE AND/OR DESCRIPTION OF THE ACTION BEING APPROVED.

The action being approved is the authority to restrict competition of the Energy Help Desk Support (EnergyHDS) services to one General Services Administration (GSA) Federal Supply Schedule (FSS) source, Varec, Incorporated (Varec) for the purposes of awarding a 6-month task order.

Specifically, DLA J62BGB (the Customer) requests issuance of a 6-month GSA FSS task order to provide continued support for EnergyHDS services currently provided under task order SP4706-13- F-5003 while the Customer separates the Tier I and Tier II EnergyHDS requirements. In accordance with Federal Acquisition Regulations (FAR) 8.002(a)(2) and 8.704 (a)(2)(i), the Customer plans to transition the Tier 1 requirements into an existing DLA AbilityOne Program contract, either SP4701- 12-D-0001 for the Enterprise Help Desk and/or SP4510-16-M-0002 for the Contract Interaction Center (CIC). The Customer plans to transition Tier II tasks supporting Energy Procurement Support Tool (EPST) to contract SP4706-15-C-0002 and transition Tier II tasks supporting Fuels Manager Defense (FMD) tasks to task order SP4706-14-F-0016.

The resulting task order will include Federal Acquisition Regulation Clause 52.217-8, Option to Extend Services, which will allow the Government to extend services up to an additional 6 months, if required. The period of performance is from September 8, 2016 to March 7, 2017.

3. A DESCRIPTION OF THE SUPPLIES OR SERVICES REQUIRED TO MEET THE

AGENCY’S NEEDS/ESTIMATED DOLLAR AMOUNT.

Varec shall provide the following services during the performance period: Tier I, Tier II, Priority 1 Ticket servicing, BMC Service Desk Express support, Energy Program Applications Support, and transition. The EnergyHDS requirement manages information technology hardware and software necessary for the exchange of fuel inventory and financial data functioning within the FMD application at each Defense Fuel Supply Point (DFSP) or capitalized fuel site. EnergyHDS support personnel provides applications support for the following Varec owned and developed software applications: FuelsManager Defense (FMD) and Leak Manager (LM). EnergyHDS personnel also provide operational application support for the following non-Varec applications: Automated Fuels Service Station (AFSS) software, the Automated Tank Gauging System (ATG), the Hydrant Automated Management System (HAMS), the Automated Fuel Hydrant Equipment (AFHE), and elements of the Enterprise Business System (EBS). Uninterrupted help desk support is critical to the DLA Energy field support mission. Failure to provide applications support to field personnel in a timely manner may result in mission failure at affected locations.

Varec’s Help Desk analysts provide trouble-ticket resolution and one-on-one assistance for field organizations, as required. Analysts must be able to step remote site users through software applications to resolve complex fuel management problems. The EnergyHDS is critical to the inventory and financial management of DLA Energy’s Department of Defense (DoD) Fuel, Defense Working Capital Fund (DWCF) and the military services’ fuels storage and distribution systems worldwide.

The Independent Government Cost Estimate (IGCE) is $1,244,552.90.

4. THE AUTHORITY AND SUPPORTING RATIONALE (SEE FAR 8.405-6(a)(1)(i) and

(b)(1)) AND, IF APPLICABLE, A DETERMINATION OF THE PROPOSED

CONTRACTOR’S UNIQUE QUALIFICAITONS TO PROVIDE THE REQUIRED

SUPPLY OR SERVICE.

The authority is FAR 8.405-6(a)(1)(i)(C), “In the interest of economy and efficiency, the new work is a logical follow-on to an original Federal Supply Schedule order provided that the original order was placed in accordance with the applicable Federal Supply Schedule ordering procedures. The original order or BPA must not have been previously issued under sole-source or limited-sources procedures.”

Contract, SP4706-13-F-5003, was awarded competitively on GSA under SP4706-12-Q-0003 with multiple offers received. Award was made to Varec on March 29, 2013. The services being provided under this action are a logical follow-on to the current contract and the additional performance period is needed in order to facilitate the Customer’s transition of the Tier 1 services requirement to the mandatory Ability One program.

Varec’s unique qualifications to provide the required services are as follows: (1) the current Tier I and Tier II analysts are the only personnel fully trained to support the existing DLA Energy customer base; (2) Varec’s internal task breakdown trees used by the EnergyHDS analysts for problem isolation and resolution have been developed and implemented by more than a decade of continuous customer support; and (3) only Varec’s analysts have direct access to system developers to identify and resolve novel problems involving the application. Based on these qualifications, there is no potential for site support failures or processing errors which could cause logistics interruption, loss of visibility and accountability of on-hand inventories, allow petroleum leaks to go undetected, or inhibit fuel support to the war-fighter for any of the DLA-managed fuels applications. The risk of unacceptable performance is very low. Varec’s engineering and commercial staff, technical library and knowledge of the system code provides the most effective solution to systemic and technical problem issues.

5. A DETERMINATION BY THE ORDERING ACTIVITY CONTRACTING OFFICER

THAT THE ORDER REPRESENTS THE BEST VALUE CONSISTENT WITH 8.404(d).

In accordance with FAR 8.404(d), a price evaluation was performed as required by FAR 8.405-2(d).

The ordering activity considered the level of effort and the mix of labor proposed to performed the specific tasks being ordered, and for determining that the total price is reasonable and represents the best value for the Government. Per FAR 8.405-4, the ordering activity requested price reductions.

In accordance with FAR 8.404, Use of Federal Supply Schedules, paragraph (d) Pricing (DEVIATION) dated May 13, 2014, the contracting officer determined the proposed price to be fair and reasonable based on the proposal analysis techniques at 15.404-1. The ordering activity used the following price analysis techniques: comparison of proposed prices to historical prices paid, in accordance with FAR 15.404-1(b)(2)(ii) and comparison of proposed prices with independent Government cost estimate in accordance with FR 15.404-1(b)(2)(v).

6. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AMONG SCHEDULE

HOLDERS AND THE RESULTS OR A STATEMENT OF THE REASON MARKET

RESEARCH WAS NOT CONDUCTED.

Market research was conducted in accordance with FAR 10.002. The ordering activity contacted knowledgeable individuals in the Government and queried the Government wide database of contracts. Market research determined that the Government’s needs can be met by a service customarily available in the commercial marketplace that meets the definition of a commercial item at Subpart 2.1.

DCSO Fort Belvoir issued solicitation SP4706-16-Q-0001 on a competitive basis on January 29, 2016 to acquire EnergyHDS support services via a GSA FSS. The solicitation closed on March 1, 2016. Six vendors, including Varec, submitted proposals. Due to the Customer’s decision to award Tier I support to mandatory source AbilityOne via contract SP4701-12-D-0001 or SP4510-16-M- 0002 the solicitation was suspended prior to award. Efforts to identify a viable path towards combining the Tier 1 EnergyHDS functions with the abovementioned DLA AbilityOne Program contracts are ongoing. Splitting Tier I and Tier II requirements into separate components is expected to be completed no later than October 31, 2016. Tier II tasks supporting EPST will transition to EPST contract SP4706-15-C-0002 while Tier II tasks supporting FMD and Leak Manager will transition to FMD Deployments and Onsite Support contract SP4706-14-F-0016. At this time, there are no other contractors that can immediately and effectively step in and take over operation of the Energy Help Desk without introducing significant mission risk, and establishing an award to other than the Varec would require the active transition assistance of Varec beyond the term of the existing contract.

7. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN

COMPETITION.

The EnergyHDS is a prerequisite for DLA Energy support to over 600 field sites worldwide. Several external factors, the help desk ticketing system and 800-number, and the EnergyHDS backend software, tie operations to the existing vendor and location. Additionally, no other application support help desk exists today with the capability to provide retail fuels information to the Enterprise Business System in the appropriate format while using the DLA Energy business transaction rules built into the applications to validate transactions.

Customer support for Tier I and Tier II tasks can only be accomplished by Varec at this time due to the need to use the existing ticketing system and 800-number. The interim methods identified to transfer the 800-number have the side effect of reducing maximum call volume by half, which is not a valid solution. DLA Enterprise Help Desk analysts cannot create or route EnergyHDS tickets until the customer base and problem trees are created in the DLA Enterprise Help Desk ticketing system.

Presently, the same phone number needs to remain at Varec’s EnergyHDS location so help desk analysts can continue to handle Tier I and II EnergyHDS problems until Tier I support is migrated to the AbilityOne contract.

The software utilized by Varec is different from the software used by the DLA Enterprise Help Desk.

The equipment, customers, data, and ticket decision trees need to be imported into the DLA Enterprise Help Desk ticketing system and normed to its processes. Based on the timeline provided to the Customer by the DLA Enterprise Help Desk Program Manager, this process will not be completed until December 15, 2016.

The entire FMD equipment database for hardware and software deployed to the military services’ sites has to be imported into the DLA Information Technology Asset Management (ITAM) system as part of the effort to unify the EnergyHDS with the DLA Enterprise Help Desk. This process would move forward in lockstep with the DLA Enterprise Help Desk ticketing system migration, as the two databases are somewhat integrated with each other.

In addition to the external factors cited above, the Tier II help desk analysts perform significant portions of site upgrades when updating the fielded version (currently, the fielded version is FMD 8.0) of the application suite. FMD 8.0 is currently deployed to all of the military services’ sites.

Analysts contact each site, determine the type of upgrade required, feed information to the Deployments teams (working under separate contract SP4706-14-F-0016) for full-up sites or engage directly with site personnel to migrate their data to the upgraded DLA Enterprise FMD environment and walk them through operations using the new software. These actions are solely done by the existing EnergyHDS, with no potential fallback options under the other FMD lifecycle support contracts if the EnergyHDS was not available. Lack of this capability would ensure mission failure during the upcoming upgrade to the next version of FMD (Version 9), required to maintain compatibility with current Microsoft Windows versions utilized by the military services on their networks, and to the deployment of the Army Petroleum System of Record initiative currently in coordination for final approval through Office of the Secretary of Defense. Varec is the only support vendor currently positioned to maintain the EPST Tier II support task without a break in service until appropriate contract modifications to EPST contract SP4706-15-C-0002 are complete.

8. A STATEMENT OF THE ACTIONS, IF ANY, THE AGENCY MAY TAKE TO

REMOVE OR OVERCOME ANY BARRIERS TO COMPETITION BEFORE ANY

SUBSEQUENT ACQUISITION FOR THE SUPPLIES OR SERVICES.

There are no actions that can be taken now or in the foreseeable future to remove the current barriers to competition for Tier I and Tier II help desk support services. Without EnergyHDS support from Varec, DLA Energy would suffer unacceptable mission failure. This makes full and open competition impossible until completion of the ongoing efforts to determine the viability of folding EnergyHDS into existing DLA contracts, leaving DLA Energy dependent on Varec, Inc. to continue its operation of the existing EnergyHDS until the Government’s Tier I and Tier II requirements are separated as described above. The Customer plans to: (1) fold the Tier I requirement into one of the existing DLA AbilityOne Program contracts, either Enterprise Help Desk SP4701-12-D-0001 and/or Contract Interaction Center SP4510-16-M-0002; (2) transition Tier II tasks supporting EPST to SP4706-15-C-0002, and (3) transition Tier II FMD tasks to SP4706-14-F-0016.