17DJQ65_J A.pdf

DEPARTMENT OF THE NAVY

CRANE DIVISION

NAVAL SURFACE WARFARE CENTER

300 HIGHWAY 361

CRANE INDIANA 47522-5001

JUSTIFICATION AND APPROVAL (J&A)

IN REPLY REFER TO:

J&A Number: 16-039 Code: 0231 PR No: N00164-16 - R- JQ65

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

JUSTIFICATION

l. Contracting Activity

The Naval Sea Systems Command, Naval Surface Warfare Center, Crane (NSWC, Crane), Special warfare and Expeditionary Systems Department (SWESD) Contracting Division (023).

2. Description of the Action Being Approved

Award of a five (5) year firm-fixed-price, indefinite - delivery, indefinite-quantity, supply and repair contract on a sole source basis for components in the Multi-spectral Targeting Systems (MTS) Electronics Unit (EU) to Quantum Imaging, Colorado Springs, CO (Cage 731K6). Anticipated components include Short Wav e Infrared (SWIR) and Visible-Near Infrared Cameras (VNIR) and Power Supply Electronics Cases and associated line items.

3. Description of Supplies/ Services

This procurement is for the purchase of Short Wave Infrared (SWIR ) and Visible-Near Infrared Cameras (VNIR) and Power Supply Electronics Cases to facilitate a shortened repair turnaround time of the Multi spectral Targeting Systems (MTS) to operational use. The camera components sought include MTS PN 6645387 SWIR, PN 6636475 VNIR, and future variants of these components. This procurement also includes non-recurring engineering, repairs, training, technical documentation and technical reachback support. Specialized test equipment required to test and screen the condition of the items may also be procured.

The supplies required by this contract are for the replacement and sustainment of the proprietary MTS systems manufactured by Original Equipment Manufacturer (OEM) , Raytheon Company. The MTS system is already in use in the field . Quantum Imaging is a subcontractor to Raytheon Company. The parts will be utilized in the repair support of the Raytheon family of Electro-Optic Infrared (EO/ IR) Systems also known as MTS. This family of EO/ IR systems include the AN/AAS-44A, B, C; AN/ AAS-52A, B, AN/ DAS-1, 2, AN/ AAS-53A, AN/ ZSQ-2 and future derivativ es, hereafter referred to as EO/ IR Systems. These systems provide Intelligence Surveillance and Reconnaissance (ISR), Detection, Identification and Targeting capability in day/ night operations for both manned and unmanned platforms. These internal components are key elements of the MTS.

J&A Number: 16-039 Code: 0231 PR No: N00164-16-R-JQ65

The estimated total value of this acquisition is $ 10,336,025 as described in Table 1. Approximately 90% of this acquisition's value is for supplies with 10% for services.

The Government's minimum needs h ave been verified by certifying technical and requirements personnel.

Table 1 - Estimated Dollar Value

FY 16 FY 17 FY 18 FY 19 FY 20

($K) ($K) ($K) ($K) ($K)

PROC $ $ $

O&M Lay-in

Parts Total

4. Statutory Authority Permitting Other Than Full and Open Competition

10 U.S.C. 2304(c) (1) Only one responsible source .

5. Rationale Justifying Use of Cited Statutory Authority

Total ($K) $1

$10,336.0

The items/services being procured under this J&A are in direct support of the replacement and repair of the MTS, which has been deployed on Navy H-60 Rotary Wing, Air Force Manned & Unmanned Air Vehicles (UAVs) and Army UAVs. The MTS OEM, Raytheon Company , subcontracted design and production of the Short Wave Infrared (SWIR) and Visible-Near Infrared (VNIR) Camera and Power Supply Electronics Case to Quantum Imaging.

The Government has been purchasing the EO/IR systems from Raytheon for over ten (10) years and has deployed more than five hundred systems in multiple manned and unmanned platforms . All prior requirements for Quantum Imaging components and repairs were covered by sole source contracts/orders placed with Raytheon Company, the MTS system OEM . The requirement for the Quantum Imaging components comprises approximately five percent of the cost/price of purchase or repair of a MTS system.

In an effort to shorten repair turnaround time, the Government seeks to purchase supplies and services required for sustainment of the MTS directly from the OEM subcontractor. The Government further intends to develop Organic Depot testing and screening for some limited repairs .

Manufacturing of the Quantum Imaging components by any source other than the OEM is not practicable. Quantum Imaging designed, developed, and manufactured the Quant um Imaging components to meet the Government's performance specification, and to interface with Raytheon's MTS system.

The Government does not own design specifications adequate to allow for competition, and on 02 March 2016, Quantum Imaging advised that, Code: 0231 PR No: N00164-16 -R-JQ6 5

"Qua ntum Imaging would not be selling the license and proprietary data to the Government or to any entity" . Based upon their unique system design, test and component interface knowledge and experience, this Raytheon Company subcontractor is the only contractor possessing the capability to provide the required supplies/services.

Award to any source other than Quantum Imaging would result in substantial duplication of costs that are not expected to be recovered through competition , and unacceptable delays would occur in fulfilling the agency' s requirement.

Based on responses received to the Request for Information (RFI)/Sources Sought, published on FedBizOps (FBO.gov) 17 March 2016, and responses received to the pre-solicitation synopsis published on 26 April 2016 , and current engineering estimates; developing an alternative source woul d result in a 22 - month delay. The 22 - month delay would be necessitated by reverse engineering of the Quantum Imaging components and developing specifications, soliciting competitive offers and awarding to an alternate source, development, produ ction, system integration and operational test verification as detailed in Table 2 below. This 22 month delay would seriously jeopardize the ability of program managers to field MTS systems and sustain their use by end users in theater .

The cost and schedule estimates derived from analysis of RFI submissions were :

Table 2 - Esti mat es Deriv ed from RFI / SS Responses Respondent Estimated Cost Estimated Schedule

$3 , 470,000*

* Estimated cost included due to insufficient supporting information in submission .

The development and sustainment of another source would result in excessive duplication of costs to the Government, and these costs would not be recouped through competition. The costs to deve l op an alternate source are estimated at a minimum of $2.0 million as shown in Table 2 above. The independent estimated value of this buy compared to the estimated integration and test costs, makes it impracticable to pursue competition now or during the course of performance du e to higher costs associated with integration and test costs.

6. Description of Efforts Made to Solicit Offers from as Many Offerers as Practicable

J&A Number: 16- 039 Code : 0231 PR No: N00 164- 16- R- JQ6 5

Sol i citation N00 164-16-S - NB53, Request for Information (RFI) / Sources Sought, was posted on FedBizOps (FBO . GOV) 17 Ma rch 2016 in a further effort to identify and develop additional sources to mitigate t he sole source requiremen t. The RFI, t i tled "Short Wave Infrared Camera (SWIR) , Visible-Near Infrared Ca mera (VNIR) and Power Supply Electronics Case for the Multi Spectral Targeting System (MTS)" closed on 7 April 2016 with a total of three responses . Analysis o f responses det e r mined that none of the respondents could meet t h e RFI requirements with existing capabilities as described in the responses.

The Government notified two (2) of the three (3) companies responding to the RFI via written correspondence by email on 23 May 2016 and the third company on 1 June 2016 to advise each respective vendor of its lacking capability . As of this date, no response has been received from any of the vendors .

Market research was and is conducted on a continuous basis by the requiring technical activity . The informal market research includes contacting knowledgeable individuals in the Government and industry, reviewing previous procurements and in-house contracts, review of catalogs and other product literature, internet searches and attendance at Industry Trade shows . The requiring activity representatives maintain a close working relations hip with the Electro-Optics industries throughout the world. This working relationship with industry facilitates continuous knowledge of the available technologies and manufacturing capabilities throughout the industry.

A synops is of the proposed action was posted to FBO on 26 April 2016.

Two (2 ) addition al inquiries have been received, reviewed, a n d determined to be unable to meet the current requirements with existing capabilities as described in the responses . The Government notified both companies responding to the pre - solicitation notice via written correspondence by email on 23 May 2016 to advi s e each respective vendor of its lacking capability. As o f this date, neither v e ndor has provi?ed any response.

7. Determination of Fair and Reasonable Costs

The Contracting Officer has determined that the anticipated cost to the Government for the supplies/ services covered b y the J&A will be fair and reasonable . The contracting office will use cost and price analysis to determine a fair and reasonable price. DCMA pricing ass istance and/ or DCAA audit of contractor ' s proposal may be requested along with offeror's certificate of current cos t and pricing to support the fair and reasonable cost determination .

8 . Actions to Remove Barriers to Competition

PR No : N00 164- 1 6- R- J Q65

For the reasons set forth in Paragraph 5, NSWC Crane has no plans at this time to compete future contracts for this type of supplies/ services covered by this document . If another potential s ource emerges, NSWC-CD will assess whether competition f o r future requirements i s feasible.

J&A Number: 16- 039

PR No : N00164-16-R-JQ65

CERTIFICATIONS AND APPROVAL

TECHNICAL/REQUIREMENTS CERTIFICATION (FAR 6.303-2(b) )

I certify that the facts and representations under my cognizance, which are included in this justification and its supporting acquisition planning data, including the MH-60R Multi-Mission Helicopter Upgrade Acquisit ion Plan number 299-2008 - 03-26-R? dated 07 March 2012, the MH-60S Fleet Combat Support Helicopter Acquisition Plan number 299-2008-08-26-R2 dated 7 March 2012, and Big Safari Single Acquisition Management Plan dated 1 June 2002, except as noted herein , are complete and accurate to the best of my knowledge and belief.

2 '(Jlt,v? Ou.

Date

LEGAL SUFFICIENCY REVIEW {NMCARS 5206.303 (90))

CONTRACTING OFFICER CERTIFICATION {FAR 6.303-2{a) (12))

APPROVAL BLOCK {FAR 6.304 for Approving Official)

Upon the basis of the above justification, I hereby approve , as Competition Advocate for the Procuring Activity the solicitation of the proposed procurement described herein using other than full and open competition, pursuant to the authority of 10 U .S.C . 2304{c )(1) .

Crane Division Competition Advocate

Signature is accurate and complete to the best sufficient.

COGNIZANCE :

Date