Memo For Record - Consolidation Determination Redacted final NM VADO.pdf

Determination and Findings for NM BR AAO EL VADO Heron & El Vado Road Rehabilitation

Controlled by U.S. Department of Transportation, Federal Highway Administration, Central Federal Land Highway Division, Office of Business Operations, Acquisitions & Contracting Branch, 720-963-3500

U. S. Department of Transportation Federal Highway Administration

Central Federal Lands Highway Division

Determination and Findings

In accordance with Section 44 of the Small Business Act (15 U.S.C. 657q) as amended, the consolidation of contract requirements is suitable for the rehabilitation of roadways and various parking lots within El Vado and Heron State Parks in Rio Arriba County, New Mexico. The estimated value is (inclusive of base and option items). The solicitation will be issued as a total small business set-aside.

Additionally, under Section 44 of the Small Business Act, the head of a Federal agency may not carry out an acquisition strategy that includes a consolidation of contract requirements of the Federal agency with a total value of more than $2,000,000, unless the Senior Procurement Executive or Chief Acquisition Officer for the Federal agency, before carrying out the acquisition strategy-

(a) conducts market research;

(b) identifies any alternative contracting approaches that would involve a lesser degree of consolidation of contract requirements;

(c) makes a written determination that the consolidation of contract requirements is necessary and justified; and

(d) identifies any negative impact by the acquisition strategy on contracting with small business concerns.

Per Transportation Acquisition Manual (TAM) 1207.107-2, all consolidation determinations required by Federal Acquisition Regulation (FAR) 7.107-2(a) in accordance with 15 U.S.C. 657q shall be approved by the Senior Procurement Executive.

Findings:

Background

15 U.S.C. 657q(a)(2) defines the “consolidation of contract requirements”, as the use of a solicitation to obtain offers for a single contract or a multiple award contract —

(a) to satisfy two (2) or more requirements of the Federal agency for goods or services that have been provided to or performed for the Federal agency under two or more separate contracts lower in cost than the total cost of the contract for which the offers are solicited; or

(b) to satisfy requirements of the Federal agency for construction projects to be performed at two (2) or more discrete sites.

Controlled by U.S. Department of Transportation, Federal Highway Administration, Central Federal Land

Market Research

The Central Federal Lands Highway Division (CFLHD) of the Federal Highway Administration (FHWA) is proposing to issue an Invitation for Bid (IFB) to result in a contract for the rehabilitation of roadways and various parking lots within El Vado and Heron State Parks in Rio Arriba County, New Mexico.

1. Market Research was conducted as per the Federal Acquisition Regulation (FAR) 7.107-2(a)(1) and

Transportation Acquisition Manual (TAM) 1207.107-2(a)(2)(ii). A sources sought notice was posted to sam.gov on November 19, 2024, with a response due date of December 3, 2024. A Dynamic Small Business Search was also conducted on November 20, 2024, which yielded a total of 18 small businesses in New Mexico that have sufficient bonding capacity that may be capable of performing the work of this requirement, three (3) of which provided positive responses to the sources sought notice by stating their intentions to bid this opportunity. In the market research report, two (2) out of the three (3) small businesses that responded to the sources sought notice were deemed fully capable.

In addition, consolidating this requirement will not have an adverse effect on Small Businesses’ capability to compete for this requirement, based on the receipt of numerous responses to previous Invitation for Bids (IFB) and Request for Proposals (RFPs) issued for similar scope and size. The Dynamic Small Business search discussed above also located several Small Businesses, many of which are in multiple socioeconomical categories for the NAICS code 237310 prescribed by the nature of the work, summarized below:

New Mexico Number of Firms Found 100% Small Business 18 8(a) Certified 6 HUBZone Certified 3 Veteran Owned (including Service - Disabled) 3 Women Owned 4

The results of the market research confirmed that small businesses possess the specialized staff and experience required to perform the services and further concluded any type of socioeconomic set-aside would restrict adequate competition. Small business concerns are included in the acquisition strategy and the solicitation will be competed as a total small business set-aside to maximize small business participation and promote adequate competition. CFLHD coordinated with the FHWA Small Business Specialist and received an approved DOT 4250 on December 20, 2024.

2. The project will be procured via an IFB Solicitation. The estimated amount of the contract is

The work is divided into two (2) separate bid schedules (Base and one Option) as follows:

(a) Schedule A (El Vado)

(b) Option X (Heron Lake)

Total

Controlled by U.S. Department of Transportation, Federal Highway Administration, Central Federal Land

Alternative Contracting Approaches and Benefits of Proposed Acquisition Strategy

Alternative contracting approaches to consolidation would involve issuing separate individual solicitations for the contract by unit. These procurements would be sealed bid or negotiated procurements. The alternative can be summarized as follows:

- Alternative 1: Bidding two (2) contracts

The purpose of this acquisition is to rehabilitate roadways and various parking at two (2) discrete sites within El Vado State Park and Heron State Park in Rio Arriba County, New Mexico. The scope is similar in nature for the two (2) discrete project sites resulting in larger contract quantities and similar contract administration requirements. Therefore, work performed at less locations under separate contracts would most likely result in more time for procurement and higher costs due to smaller contract quantities and duplicative contract management costs.

Additional Benefits of the Proposed Acquisition Strategy

1. There are potential reductions in the government staff time to develop solicitations, evaluate proposals, assess contractor offers, and administer contracts. This efficient use of agency resources continues to be an important consideration when selecting an acquisition strategy.

2. Solicitations on the consolidated contract have a shorter acquisition cycle; thus, allowing the construction to start sooner and construction to be completed in one construction season. If the projects were bid separately, the solicitations would have to be staggered resulting in one (1) to two

(2) additional months in the pre-award phase of the projects which could result in construction duration extending into a second construction season. In addition, there will be time saved by the Government in making the Responsibility Determination as well as other award activities which are estimated to save approximately one (1) to two (2) weeks.

3. CFLHD’s partners at the U.S. Bureau of Reclamation and the New Mexico State Parks have expressed support for this method of procurement as it would allow an expeditious rehabilitation of the project sites which aligns with the goals of the Federal Lands Transportation Program project and optimizes contractor time, provides for phasing flexibility, and will maximize available resources to complete the work.

4. Cost savings in both the preliminary engineering and construction phases were estimated considering the following scenario:

- Scenario 1: Comparing Alternative 1 (bidding two (2) contracts) to a single consolidated contract

During the final design, advertisement, and award phases there are typical costs involved on projects independent of contract size. These are related to assembling the Plans, Specifications, and Estimates (PS&E) packages, preparing the solicitation documents, evaluating bidder questions, analyzing bids, CUI//SP-PROCURE//FEDONLY

Controlled by U.S. Department of Transportation, Federal Highway Administration, Central Federal Land

Steps taken to include Small Businesses

Small Business concerns are included in the acquisition strategy and the solicitation will be competed as a total small business set-aside.

Determination:

Based upon the findings above and pursuant to the authority in Section 44 of the Small Business Act (15 U.S.C. 657q) as amended, this acquisition strategy involving the consolidation of the two (2) discrete sites into a single contract is justified for the rehabilitation and reconstruction of various parking lots and access routes at the El Vado and Heron State Parks in Rio Arriba County, New Mexico. CFLHD will proceed with procuring the work of this requirement in a single procurement based on cost analysis and rationale presented above. The benefits of the acquisition strategy, a savings substantially exceed the benefits of the alternative contracting approach. Further, the benefits threshold of ten percent of the estimate contract value for this proposed consolidation as prescribed in FAR 7.107-2(d) are also met.