Redacted_DSC_J&A_Amd_2.pdf

J&A No: 16-0052 Amd 2 Contract No. HQ0147-12-C-0004

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Introductory Paragraph.

Upon the basis of the following justification, I, as Director of the Missile Defense Agency (MDA), hereby approve the issuance of the contractual action discussed below using other than full and open competition pursuant to the authority cited herein.

2. Agencies and Contracting Activity, (Federal Acquisition Regulation (FAR) Part 6.303-2(b)(1)).

This Justification and Approval (J&A) is for the MDA Ground-Based Midcourse Defense (GMD) Joint Program Office. This document is conformed and includes Justification and Approval (J&A) 16-0052, J&A 16-0052 Amendment 1, and J&A 16-0052 Amendment 2. The contracting activity is GMD Contracts DAC (DACN). The point of contact for this action is Philip E. Graham, Contracting Officer, at 256-955-4072.

3. Nature and Description of the Action Being Approved, (FAR Part 6.303-2(b)(2)).

MDA competitively awarded the Development and Sustainment Contract (DSC) to Boeing, Missile Defense Systems, Huntsville, AL (HQ0147-12-C-0004) in December 2011. The current contract value is $5.85Billion (B) with a current Period of Performance from December 30, 2011 through September 29, 2022. With accelerated capability and linked GMD execution planned to go through December 31, 2023, the contract will increase in value from $5.85 B to over $12.0 B. The DSC is considered a hybrid contract that combines multiple pricing and fee arrangements, including cost plus incentive, cost plus award, and fixed price incentive for pricing individual Contract Line Item Numbers (CLINs). The current scope-of-work under this contract includes: development, fielding, test, systems engineering, integration and configuration management, equipment manufacturing and refurbishment, training, and operations and sustainment support for the GMD Weapon System and associated support facilities.

The Boeing Company is singularly capable to rapidly develop, engineer and insert advanced technologies, to include cyber and exoatmospheric protection capabilities, into GMD components within available funding without causing unacceptable delays in fulfilling the Agency’s requirements on an accelerated schedule.

In February 2017, Justification and Approval 16-0052 was approved for the DSC. It added additional scope that could not be completed at the end of the Period of Performance (PoP). This additional scope extended the DSC PoP until December 29, 2021.

In August 2017, Amendment 1 to this J&A was approved for the DSC. This amendment included expanded GMD scope to support RKV development and extended the DSC POP from December 29, 2018 to September 29, 2022. Due to the overall complexity of the GMD requirements, the long lead times associated with the procurement of materials and the intricacies of the software life cycle, Amendment 1 included optional content as mitigation to schedule risks associated with future contract awards.

In response to increased Inter-Continental Ballistic Missile (ICBM) threats, the President in August 2017 expressed his commitment to expanding and improving a state-of-the-art, missile defense system. Acknowledging the advancing threat, the Secretary of Defense in September 2017 indicated the need to react quickly to ensure our defensive capabilities remain relevant.

Congress responded with immediate support providing funds in September 2017 through an Above-Threshold Reprogramming Request (ATR) to MDA to accelerate delivery of missile defense capabilities. Specifically, the ATR provided $47.0 Million (M) of FY 2017 Defense- Wide Procurement funds for Advance Procurement of components for the first 10 of 20 new additional silos planned for a new missile field at Fort Greely, Alaska. Also provided in the ATR was$81.0 M of FY 2017 Defense Wide RDT&E funds for non-recurring engineering in advance of procurement. Congress provided this funding for MDA to increase ground-based interceptor quantities by up to 20 and to add 20 new silos for the new missile field. Additionally, Congress directed$8.0 M of Defense-Wide RDT&E funds for advancing the kill vehicle efforts to match the increase in ground-based interceptors.

To address the need for follow-on funding to complete the accelerated deliveries, the President transmitted to Congress a proposed amendment to the Fiscal Year 2018 Department of Defense budget. Included in the request was an additional $2.1B for missile defense. Activities for which the funding was proposed include the construction of Missile Field No. 4 at Fort Greely, and more initial procurement funding for the purchase of 20 new ground-based interceptors.

Congressional marks released in connection with the Fiscal Year 2018 Defense Appropriations bill indicate the requested funds will be appropriated.

To provide authority for the acceleration work, Congress included language in Section 1686 of the enacted National Defense Authorization Act (NDAA) for Fiscal Year 2018 to increase the number of ground-based interceptors by up to 28 if consistent with the Ballistic Missile Defense Review. Further, the NDAA provided authority to plan a further increase up to 104 ground-based interceptors, execute missile field construction at Fort Greely, Alaska, and to deploy up to 20 additional ground-based interceptors “as soon as technically feasible”. And in Section 1689, Congress indicated the Director of the Missile Defense Agency should, to the extent practicable, accelerate additional ground based interceptors and the redesigned kill vehicle used in those interceptors.

Current execution plans call for the Agency to deliver at least some initial additional defensive capability in 2021 with Technical Capability Declaration (TCD) by December 31, 2023. To achieve that objective, the Agency must begin procurement of Long Lead Materials, using congressionally provided Advanced Procurement funding, no later than January 2018.

The GMD acceleration requirement includes critical linkages between the existing GMD program execution schedule to integrate, sustain and maintain available facilities, suppliers and fabrication/integration capabilities in case an unfortunate, national emergency should evolve that are not severable from the DSC acceleration effort. This amendment 2 provides the program content authorized to execute GMD acceleration and to extend the DSC contract period of performance through 1QFY24 to maintain all BMDS increment 6 program linkages. The acquisition lead-time to proceed through a competitive source selection combined with any transition time-period to qualify another GMD vendor precludes the Agency from reasonably delivering accelerated GMD capability by the NDAA December 31, 2021 initial deployment date.

4. Description of the Supplies and/or Services Required to Meet the Agency’s Needs (including the estimated value), (FAR Part 6.303-2(b)(3)).

The base J&A and Amendment 1 approved the following scope:

a. Ground Based Interceptor (GBI) and All-Up-Round (AUR) Support and Infrastructure:

i. Test and deliver system selectable 2- or 3-Stage mode software.

ii. Acquisition of 11 additional Configuration 2 (C2) boost vehicles (BV), booster spare parts, and associated avionics to maintain fleet and the flight test program.

iii. Kill Vehicle and BV software builds.

iv. Product and component System Engineering support, component Models and

Simulation (M&S) and support to Government software Independent Verification and Validation (IV&V). These efforts will be executed with up to 302K Direct Productive Labor Hours (DPLH).

v. Product and component Flight and Ground Test support

vi. Continuation of the Stockpile Reliability Program.

vii. AUR systems engineering to integrate an RKV with a Configuration 1 (C1) and C2 BV.

viii. Perform Flight Test Rotation of three BVs; integrate the BV with RKVs, emplace the flight test interceptor; conduct flight tests, pre-test and post-test analysis, and corrective actions to support flight tests Controlled Test Vehicle (CTV)-03, Flight Test GBI (FTG)-17, and FTG-18.

ix. GBI Development and Integration Laboratory support for AUR test and integrated testing with ground systems.

x. Acquisition of BV HW for the Government Independent Verification and Validation lab.

b. Ground Systems (GS):

i. The GS 7B and 8 program implements major and significant upgrades to the software (SW) and hardware (HW) of the GMD Fire Control (GFC), In-Flight Interceptor Communication System (IFICS) Data Terminal (IDT), and the GMD Communication Network (GCN). These actions are required to meet the BMDS Increment 6b requirements planned for inclusion in Ground Test (GT-08) and Flight Tests (CTV-03, FTG-17, and FTG-18). The GS 7B and 8 program efforts in the extension will include the following:

1. Position Navigation and Timing upgrades, Mid-Term Discrimination Program improvements, 2-/3-Stage Selectable capability, BMDS System Track implementation, Long Range Discriminating Radar (LRDR), and interface changes required to support the RKV, Command, Control, Battle Management and Communications system, On-Demand Communications and fielding, Engagement Planning and Intercept Flight Test Capability.

2. Completion of development, integration, regression testing, testing of objectives for Final Qualification Testing (FQT), and the Readiness Review (RR); support for the ground test and fielding of SW and HW required for Operational Capability declaration.

ii. IDT Upgrade – Complete development, integration, and checkout associated with reaching HW/SW FQT, RR and fielding for IDT upgrade.

iii. GCN Modernization – Complete development, HW/SW installation, fielding, and training.

iv. Product and component System Engineering support, component M&S, and support to Government Software IV&V. These efforts will be executed with up to 148K DPLH.

v. Product and component Flight and Ground Test support

vi. Acquisition of GS HW for the Government Independent Verification and

Validation lab.

c. System Test:

i. GMD Test Support is run as Level of Effort, and an additional 714K Direct Productive Labor Hours (DPLH) will be required in order to perform support for system test. There are multiple ground and flight tests currently scheduled in the IMTP that will take place during the extension period. The support efforts in this extension will include:

1. Complete Ground Test Concept of Operations (CONOPS) for GT-07.

2. Manage test resources, test range support, test assets, processes, GMD

Test Plan, System Test Labs, Range Interface Test and Evaluation (RITE), Test Control System (TCS), and facilitation/integration of cross-functional organizations.

3. Operate, maintain, support, and update/upgrade the RITE and TCS HW, SW, and infrastructure.

4. Support certification and accreditation of the systems and maintain readiness to support ground and flight test events.

5. Provide reach-back capability at the component level for planning, integration, execution, and analysis support.

6. Continue Full Flight Test CONOPS through CTV-03.

ii. Continue Full Test Support for FTG-11 to include System Pre-Mission

Test and System Post Flight Reconstruction.

d. Performance Based Logistics (PBL):

i. PBL support is required until the follow-on contract is executed, all parties have transitioned coverage, and the follow-on contractor has assumed coverage. The BMDS requires 24/7 O&S support and any loss of coverage would put the operational weapon system at risk. MDA intends to have a follow-on contract in place for PBL prior to the end of the DSC Extension POP. The Government intends to provide one ten month POP extension to guarantee system availability and ensure a smooth transition of the O&S scope from DSC to the new contract.

ii. Integrated Logistics Support, supply support obsolescence planning and mitigation, as well as sustaining engineering.

iii. MDA will include in the new GMD PBL contract the ability to reach-back to the Original Equipment Manufacturers for logistics/maintenance issues, property, transition, logistics package delivery, logistics demonstrations, and subject matter expertise on legacy technical documentation, to support sustainment of the GMD Weapon System. As a result, the DSC extension will include provision of the reach-back support.

iv. GMD forecasts the need for 40,000 DPLH to support transition of operations and maintenance of the weapon system to a new contractor.

e. Risk Mitigation: These efforts will only be executed to ensure program continuity in the event of delays to the award of follow on contracts or to reduce risk associated with transferring efforts from the developer to a new contractor.

i. Four (6) month periods of performance for PBL support will ensure 24/7 coverage for the operational system.

ii. Full Test support of FTG-17, FTG-18, GT-08, BID LAB, Silo Refurbishment, Test Infrastructure and all other Flight and Ground Tests. The GBI and GS component level support for these tests is included in the base extension scope while this option provides the Test Integration effort that is intended for a follow-on contract and will only be executed if the follow-on contractor is not in place. This option provides an additional 267K hours.

iii. Develop, integrate, test, and field GS SW Builds to address emerging issues and threats.

iv. Hardware and associated activities to support Cybersecurity requirements.

v. Special Studies: GMD forecasts a need for an additional 500,000 Direct

Productive Labor Hours for this extension period. These additional hours will allow continued use of Task Instructions, a flexible contracting vehicle under DSC, to meet critical program requirements for GMD in a timely and efficient manner. The requested increase in hours is critical to meeting the Agency’s commitments for RHD.

vi. Manufacturing and tactical emplacement of two AURs consisting of RKVs on upgraded C1 boost vehicles

This Amendment 2 approves the following Accelerated Capability scope to meet the Agency needs:

a. Ground Based Interceptor (GBI) and All-Up-Round (AUR) Support and Infrastructure:

i. Acquisition of 20 All Up Round (AUR) GBIs with a RKV/C2+ Boost Vehicle Configuration

ii. C2+ Boost Vehicle Development

iii. Integration of 2 All Up Rounds (AURs) with a RKV/C2 BV

iv. Storage, upgrade and re-emplacement of an existing GBI

v. Acquisition of 2 Flight Test vehicles to support FTO-04

vi. GBI assets for labs and test events

vii. Continuation of Stockpile Reliability Program

b. Ground Systems (GS):

i. Acquisition of 20 SIV/Silos and corresponding Launch Support Equipment (LSE) in support of a Missile Field 4 at Fort Greely, Alaska (FGA).

ii. Acquisition of 2 additional SIV/Silos and corresponding LSE at Missile Field 1 at

FGA

iii. Ground Systems (GS) Build 9 Hardware/Software

c. Systems Engineering includes an additional 1,611,633 DPLH to provide program level Systems Engineering support

d. System Test includes an additional 696,616 DPLH to provide full Test coverage through all Ground and Flight test support

e. Performance Based Logistics (PBL):

i. Additional 226,260 DPLH to provide program cyber security support

ii. Performance Based Logistics through the period of performance

The Independent Government Cost Estimate for this effort is:

Base J&A plus Amendment 1 and Amendment 2

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This effort will be funded with Research, Development, Test and Evaluation funds, Operations and Maintenance funds, and Procurement funds as authorized and appropriated by Congress.

5. Statutory Authority Permitting Other than Full and Open Competition, (FAR Part

6.303-2 (b) (4)).

The statutory authority permitting other than full and open competition is 10 U.S.C. 2304(c) (1), as implemented by FAR 6.302-1(a) (2) (ii), only one responsible source and no other supplies or services will satisfy Agency requirements:

(ii) Supplies may be deemed to be available only from the original source in the case of a follow-on contract for the continued development or production of a major system or highly specialized equipment, including major components thereof when it is likely that award to any other source would result in—(a) Substantial duplication of cost to the Government that is not expected to be recovered through competition; or

(b) Unacceptable delays in fulfilling the Agency's requirements.

6. Demonstration of Contractor’s Unique Qualifications or the Nature of the Acquisition Requires Use of the Authority Cited (FAR Part 6.303-2(b)(5)).

Boeing competed for and was selected for award of the DSC with a POP beginning December 30, 2011 and ending December 29, 2018. Boeing is the responsible source with the institutional technical knowledge critical for the successful completion of the DSC. The RKV development effort was added to the DSC in September of 2015. Boeing is currently developing, testing, and integrating all components of the GMD, including RKV. Based on evolving program requirements, the decision was made to extend additional DSC content to align with requirements levied on GMD by the BMDS to include RKV requirements. The continuation of efforts critical to RHD development allows GM to continue to deliver capability to the Warfighter, while ramping work off of the DSC at logical breakpoints in the program to promote competition. Additionally, as a primary component of the BMDS, GMD has also been levied requirements to address emerging threats. To outpace these threats, the program needs to commence development, testing, and delivery of new capabilities. MDA’s IMTP test schedule validates that these capabilities are required to be initiated prior to the end of the DSC.

Both Congress and the Administration have acknowledged the advancing threat and expressed through the actions described in Section 3 above the need to expand missile defense capabilities on an accelerated basis. MDA has received direction to accelerate the delivery of missile defense capabilities and substantial additional funding to initiate the accelerated delivery.

Amendment 2 to this J&A addresses and implements the direction to accelerate the delivery of missile defense capabilities and provides the only feasible means to execute the substantial additional funding provided and programmed to initiate the accelerated deliveries.

Viewed against the backdrop of the evolving ICBM threat against U.S. interests, the Congressional and Administration direction to accelerate, and given the lead-time required to manufacture, fabricate, assemble, deploy, integrate, sustain and maintain available GMD facilities, suppliers and fabrication/integration capabilities, it is my judgment that Boeing is the only source with the present capability to accelerate capacity, increase capability and expand capability of GMD to meet a December 31, 2021. Introducing an unqualified vendor, allowing for vendor/supplier learning against incomplete technical data packages, and shepherding this vendor through requisite validation and flight tests toward qualification place an unacceptable technical and performance risks for the Agency to field initial accelerated GMD capabilities by 2021.

Boeing is also uniquely qualified to sustain the operational system during the construction of Missile Field 4 and delivery of 20 additional GBIs. MF-4 construction and GBI delivery requires access to the same facilities, equipment, and spares that are used to sustain the GMD system. A separate award of a contract for sustainment would add significant complexity and risk at a critical time and require the government to adjudicate daily conflicts between the developing contractor and sustaining contractor for access to resources.

7. Description of Market Research Conducted, (FAR Part 6.303-2(b)(6), (8) and (10)).

MDA completed GMD Development, Operations and Sustainment, and Production Market Research on June 22, 2016. Market research activities were completed over a period of nine months to assess business interest and high-level capabilities to meet GMD’s requirements. In addition to contacting industry partners, other government agencies were contacted to gather maximum marketplace acquisition knowledge on opportunities and challenges associated with achieving a producible, reliable, maintainable, and cost effective weapon system to defend the nation. The market research methodologies used included release of a strategic-level Request for Information (RFI), RFI response evaluations, a review of the Intercontinental Ballistic Missile program, industry one-on-one interviews, and completion of the Industry Trends and Analysis Report. The market research identified there is capacity, capability, and interest in competing for all work contained in the DSC. However, the Agency will not transition to new contracts while GM’s development and production of accelerated capability to defeat the current threat is ongoing. To meet the acceleration requirement the Agency has determined it’s in the best interest of the government to contract the acceleration requirement using other than full and open competition.

8. Determination of Fair and Reasonable Cost, (FAR Part 6.303-2(b)(7)).

IAW FAR Part 15.402, the Contracting Officer shall ensure that all supplies and services ordered under this contract are procured at a fair and reasonable price. The Contractor will submit a formal proposal addressing all requirements of the solicitation. MDA will conduct a thorough evaluation of the offeror’s proposed cost/price for this effort. Certified cost or pricing data and sufficient information to support accuracy and reliability of the estimate shall be required in the proposal. Boeing’s proposal will be reviewed by experienced technical analysts and contract specialists, with the assistance of field pricing support from the Defense Contract Management Agency (DCMA) and Defense Contract Audit Agency (DCAA). The cost and price analysis will concentrate on completeness, realism, reasonableness, allowability, and allocability. Rates and factors, as well as any unusual or proposed deviations from Boeing’s approved Disclosure Statement and standard accounting practices, will be verified through the DCAA and DCMA activities. To the extent applicable, actual data from the current DSC will be used as part of the analysis. The Contracting Officer will utilize the cost and price analysis as the basis for negotiating a fair and reasonable price.

9. Any Other Facts Supporting the Use of Other Than Full and Open Competition (FAR

Part 6.303-2(b)(9)).

The additional capacity of 20 Ground Based Interceptors (GBIs) and a new Missile Field 4 (MF

4) is required in the NDAA to be initially deployed by December 31, 2021. In order to meet the 2021 requirement, the Agency must begin procurement of long lead materials, using congressionally provided Advanced Procurement funding, no later than January 2018. The planned Period of Performance to TCD of the accelerated deployment of 20 GBIs is no later than December 31, 2023. When Congress provided MDA with the ATR in September 2017, the Government had to determine the best acquisition strategy to accelerate the Redesigned Kill Vehicle development and delivery, add an additional 20 Silos at Ft Greely Alaska (Missile Field 4), and add an additional 20 Ground Based Interceptors tipped with Redesigned Kill Vehicles for Missile Field 4. It was determined that the current GMD Weapon System contractor had the requisite knowledge and data to develop and produce the Missile Field and GBIs. In addition, to successfully design, build, and field the 20 GBIs and Missile Field 4 requires Boeing to develop and test Ground System software, execute a ground and flight test program, perform the systems engineering to integrate the additional capability with the BMDS, and to execute performance based logistics. Each Ground Systems software build is dependent on previous software builds with overlapping schedule dependencies. A new contract for GS 9 would drive the Government to be the integrator of the fire control with the ground-based interceptor. Complexity of the software build would also increase because GS 9 begins development 24 months prior to availability of GS 8 final source code. As a result of the complexity and concurrence in the software development program, the DSC is best suited for development of GS software that supports the test and operation of the GMD Weapon System with a RKV AUR GBI. In addition, systems engineering and ground and flight tests are required to integrate and verify the increased GMD capability (the additional Missile Field and AUR GBIs) with the BMDS. Performance of systems engineering and test on the current DSC provides single contractor use/integration of test facilities and equipment, and supports development and testing of BMDS Increment 6 content on single contract. Finally, GMD Weapon System performance based logistics (PBL) must continue through the DSC Period of Performance to support the operational weapon system and increased capabilities as Missile Field 4 is activated and additional GBIs are turned over to the warfighter. A new contractor for PBL prior to the fielding of the additional Missile Field and GBIs would require Government integration of multiple contractor as they compete for the use of facilities, equipment, and spares at operation Missile Defense locations. This competition over assets could cause delays in fielding or increased costs if the Government is required to purchase additional facilities, equipment, or spares to adjudicate concurrent need. For the Agency to execute this scope of work, however, the Agency recognizes Congress must enact an FY2018 appropriations bill.

10. Actions Taken to Remove Barriers to Competition (FAR Part 6.303-2(b)(11)).

GMD is currently developing the acquisition strategy for the follow-on contract actions that will replace the DSC contract. The attached program schedule outlines the activities planned for potential competition in orange. The GMD office will perform market research to inform a revised DSC follow-on acquisition strategy.

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