N00178_DL13598_NECO.pdf

DEPARTMENT OF THE NAVY

NAVAL SURFACE WARFARE CENTER

DAHLGREN DIVISION

6149 WELSH ROAD SUITE 203

DAHLGREN VIRGINIA 22448-5130

IN REPLY REFER TO

J&A Number: DL 13598 Code: 0251 N00178-16-R-2037

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity

The Naval Sea Systems Command, Naval Surface Warfare Center Dahlgren Division, Contracts Department, Code 0251 (NSWCDD).

2. Description of the Action Being Approved

The procurement is for the award of a combined Firm-Fixed-Price (FFP) and Cost-Plus-Fixed-Fee (CPFF) Indefinite Delivery Indefinite Quantity (IDIQ) contract through other than full and open competition to Frontier Electronics Systems Corporation (FES) located at 4500 West Sixth Avenue, Stillwater, Oklahoma 74074-1522.

The proposed award is for the production of the AN/SPQ-14(V) Advanced Sensor Distribution System (ASDS) and the AN/SPQ-15(V) Data Distribution System (DDS) to include logistics support and engineering services for the ASDS and DDS for a five year period.

3. Description of Supplies/Services

The proposed acquisition is for an IDIQ contract with FFP and CPFF Delivery Orders (DO’s) and an overall five-year period of performance. The acquisition minimum will be and the maximum (ceiling) will be . The current Contract No.

N00178-13-D-1010 has a ceiling of and a Period of Performance of five (5) years. The increase in contract size is due to the Technical Insertion (TI) Fielding plan dated 18 July 2016 and signed by PEO IWS 1.0, Major Program Manager (MPM), which delineates the complete funding requirements for the AN/SPQ-14(V) and AN/SPQ-15(V) surface fleet including new construction and Foreign Military Sales (FMS) support. DO’s will be placed for radar distribution equipment in the following planned quantities:

a) AN/SPQ-14(V) ASDS procurement plan is for 2 units; b) AN/SPQ- 15(V) DDS procurement plan is for 33 units; and c) FMS requires 5 AN/SPQ-15(V) DDS units. DDS was developed as a replacement for AN/SPQ-14(V) ASDS. The intended use of the equipment is to provide radar and sensor distribution onboard U.S. Navy ships and to a

J&A Number: 13598 lesser extent to FMS customers as requested. User requirements will determine the actual number of units ordered and delivery for most items will be made within nine (9) months of order issuance.

The estimated cost of the proposed contract action is as calculated in the Independent Government Cost Estimate (IGCE). The funding types and costs by contract period are provided below:

IGCE Contract ($M) Amounts

Appropriation

FY

FY

FY

FY

FY

FY

22 TOTALS

The total known demand for this procurement is based on the PEO IWS

1.0 Technical Insertion Fielding chart as well as the known FMS requirements and is contained in the following chart:

Estimated Demand

Base Year BY+1 BY+2 BY+3 BY+4 Total

Quantities

Man-Hours

ASDS/DDS

Support 68,600

The Government’s minimum needs have been verified by the certifying technical and requirements personnel.

4. Statutory Authority Permitting Other Than Full and Open

Competition

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.

5. Rationale Justifying Use of Cited Statutory Authority

FES is presently the only source that has a thorough knowledge of the design, development and production of both the ASDS and DDS equipment. The company possesses the corporate knowledge and technical expertise necessary to manufacture the ASDS and DDS equipment to timely satisfy the Navy’s ship maintenance and upgrade schedule requirements. ASDS was developed under Contract No.

N00024-03-D-4021. DDS is the evolution of ASDS and was developed for the U.S. Navy by FES under Contract No. N00024-06-G-5200. The U.S. Navy did not procure a technical data package that would support the competitive procurement process for ASDS and DDS because of the lack of available funding for build to print production drawing packages. DDS has FES proprietary software embedded within the system which has benefited and will continue to benefit the Navy by reducing development costs. Attempts have been made to purchase Government Purpose Rights to the proprietary software with the most recent attempt happening in 2010. This effort proved unsuccessful as FES refused to grant Government Purpose Rights at any price. On 29 April 2016 the Government sent correspondence to FES to verify FES software and technical data rights assertions. FES responded on 12 May 2016 and listed all of the specific software and technical data that they asserted less than unlimited rights to the Government. FES’s response was reviewed by NSWCDD legal counsel and it was determined that a timely favorable resolution was unlikely due to the complex nature of the matter. This condition would result in unacceptable delays to Government requirements.

The following is a summary of the key components that are required for the ASDS and DDS systems that are asserted by FES as proprietary. These components are not currently produced by any other Industry sources:

(a) The baseboard design utilized in the Radar Interface, Identification Friend or Foe (IFF) Interface and Display Interface Modules. These modules utilize the Gigabit Data Engine software, Gigabit Data Engine Xilinx firmware, and Gigabit Data Engine Circuits which were developed by FES. They also utilize the DDS data format which was developed by FES.

(b) The Interface Personality Circuits used in the Radar Interface, IFF Interface, and Display Interface Modules. These circuits translate azimuth and timing information.

(c) The Software that utilizes the DDS data format. This includes the Scan Converter, the Variable Dwell Simulator, and the DDS Video Application Program Interface (API).

(d) Unique AN/UPX-24 IFF interface and specific Guns Weapons System multiple scan converter format requirements embedded in the proprietary software. These are required for the operation of the Converter-Receiver Controller and the Radar Signal Distribution Switchboard.

Based on the duplicative cost to develop a new radar distribution system (RDS), provide logistical support, perform functional testing, and complete qualification of ASDS and DDS development, it is estimated that the cost to replace ASDS and DDS would be

The cost breakdown is as follows:

a) b) c) d)

The Proof-of-Concept through First Article Test (FAT) and delivery is the most arduous and costly process. This process entails total coordination between the Government and the Contractor. The delivered system has successful met all requirements including electrical and mechanical safety, shipboard requirements including shock and vibration specifications, weight and balance, ergonomic characteristics and multiple user interface/inputs.

To truncate the ASDS and the DDS Radar systems and initiate the solicitation of a new vendor at a time of limited budget is a cost that the IWS Program Office would find insurmountable to absorb.

In order to meet the required delivery need date of 31 August 2018 for CG-68, the new delivery order award must be placed by 30 November 2017.

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

Offerors as Practicable

In accordance with DFARS PGI 206.302-1, a Sources Sought/Request for Information (SS/RFI) was posted on 12 April 2016 to Federal Business Opportunities (FEDBIZOPS). There were two (2) responses to the SS/RFI, one (1) from DRS Technologies (DRS) and one (1) from Global Technical Systems (GTS). Both companies submitted statements regarding their asserted technical capabilities to satisfy the procurement requirements, as follows:

DRS Laurel Technologies, PA (DRS). This company submitted a response to the SS/RFI and listed build to print capabilities supported by their production experience with AN/UYQ-70 display equipment, Shipboard Protection System (SPS-67) Radar, Ship Self Defense System (SSDS) build to print, and Cooperative Engagement Capability (CEC) equipment.

Global Technology Systems, VA (GTS). This company submitted a response to the SS/RFI and listed capabilities in design and production of surface navy systems such as Common Processing Systems (CPS), Japan Aegis Modernization (JAMOD) for CPS, and Battle Force Tactical Trainer (BFTT). The experience includes building First Article Units and Advance Production Units.

The submissions were evaluated by the Combat Direction Systems Activity Dam Neck (CDSADN) Subject Matter Expert and both firms were determined not capable of fulfilling the technical requirements of this acquisition because they do not have the means to build, or acquire and re-sell the necessary ASDS and DDS equipment. The evaluation of GTS’s capability statement was issued by CDSADN on 10 August 2016. The evaluation of DRS’s capability statement was issued by CDSADN on 8 September 2016. No further response was received by the Government from either GTS or DRS.

The above listed companies, though they may have RDS capabilities, will not meet the specific requirements developed for the AN/SPQ- 15(V) Data Distribution System. For example the Converter-Receiver Controller and the Radar Signal Distribution Switchboard, both AN/SPQ-15(V) units, have a unique AN/UPX-24 IFF interface and specific Guns Weapons System multiple scan converter format requirements embedded in the proprietary software. These functions were developed specifically for the DDS and are not available from another distributor.

In accordance with FAR 5.201, a pre-solicitation synopsis was released to FEDBIZOPS on 25 July 2016. On 26 July 2016 an email was received from Advanced Vision Systems Inc. (AVS) that asked the Government to “clarify why there is a need to sole source Engineering and Technical services? There are many companies, small and large, that are able to perform this type of work.” As a result of the email from AVS, the Synopsis was amended on 8 August 2016 to include the following information: “FES is presently the only source that has a thorough knowledge of the design, development and production of both the DDS and ASDS equipment. The company possesses the corporate knowledge and technical expertise necessary to manufacture the DDS and ASDS equipment to timely satisfy the Navy’s ships’ schedule requirements. DDS was developed for the U.S. Navy by FES under Contract No. N00024-06-G-5200. DDS has FES proprietary software embedded within the system which has benefited and will continue to benefit the Navy by reducing development costs.” No further comments and/or questions were received from AVS.

7. Determination of Fair and Reasonable Costs

The Contracting Officer has determined that the anticipated cost to the Government for the supplies and services covered by the J&A will be fair and reasonable based on the utilization of cost analysis for proposal assessment.

(a) DCMA pricing assistance and/or DCAA audit of the contractor’s proposal will be requested along with the offeror’s certificate of current cost and pricing to support the fair and reasonable cost determination.

(b) Significant quantities of this requirement have been purchased from this Offeror in the past and cost/pricing information was received on those past procurements. This information should be sufficient to support the fair and reasonable cost determination of this procurement.

8. Actions to Remove Barriers to Competition

The reasons set forth in Section 5 negated NSWCDD’s plans to compete the follow-on contract for the types of supplies and services covered by this document. In calendar year 2013, the Program Office initiated a plan to submit a Program Objective Memorandum (POM) issue paper to design an improved system for which the Government would own the proprietary data, software, and firmware. However, sequestration which occurred in the same year, stymied the development or funding for new systems. The proposed POM had entailed the development of new requirements. The guidance received by the Program Office and disseminated to the Field Activities delineated the requirement to only provide funding for existing and mature systems necessary to maintain their current baselines. Thus, new developments would not be funded.

Considering these guidelines and after meticulous budgetary review, the POM was not submitted.

The Navy is pursuing a Next Generation (NEXGEN/SPQ(X)) RDS. This next generation of Radar Systems will be modular, open architecture (OA), and competitively sourced. The SPQ(X) system establishes a radar display system that is compliant with Open Architecture and Human Systems Integration (HSI) design principles. The new RDS will be integrated across multiple platforms on Navy surface ships and will be designed using commercially available hardware and software. Through its functionality, SPQ(X) will allow operators access to their mission applications at any platform.

A POM 18 issue has been submitted to PEO IWS 1.0 Deputy Major Program Manager (DMPM) addressing the Next Generation of RDS that will provide the required criteria for full and open competition.

The POM 18 issue documentation is being reviewed by the DMPM for resolution. However, CDSADN has obtained in funding for tasking that initiates the design for the next generation of RDS.

The intent of this effort is to fully develop the next iteration of RDS to be usable on all surface combat ships and supported by Government owned technical data packages and associated software.

Government ownership of the designs is expected to result in the ability to conduct competitive sourcing for future RDS production contracts.

This procurement will constitute the final buy out of all known requirements for the AN/SPQ-14(V) and AN/SPQ-15(V) program. All requirements related to AN/SPQ-14(V) and AN/SPQ-15(V) beyond FY22 shall be competed.

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