JA_-_Updated_7-12-18.pdf

FOUO

N104-18-R-4852

JUSTIFICATION & APPROVAL (J&A) FOR USE OF OTHER THAN FULL AND

OPEN COMPETITION

1. Contracting Activity: Department of the Navy, Military Sealift Command (MSC), Ship Repair Division (N104).

2. Description of Action Being Approved:

a. This action provides the basis and rationale for awarding a contract on an other than full-and-open competition basis for long-standing, recurrent part requirements covering a broad range of pump systems in support of multiple MSC class vessels including, but not limited to, T-AH (Hospital), T-AKE (Dry Cargo/Ammunition) and T-AO (Fleet Replenishment Oiler).

b. MSC recognizes its obligation to promote competition to the maximum extent possible, which it routinely does and will continue to do. However, as further described below, the decision to procure these pump requirements using a sole source justification and approval is based on MSC’s significant experience in purchasing the very systems/items listed in paragraph 5, historically issuing discrete sole source justifications and approvals (J&As) for each acquisition. Specifically, MSC’s contracting history for more than the past decade reflects that MSC consistently acquired the subject pump systems and parts utilizing other than full-and-open competition. Rather than generate a new sole source J&A supporting each acquisition when a new pump system or part is required, this J&A consolidates supporting documentation for the previous, relevant J&As into a single J&A for efficiency. This will be a requirements type contract with firm-fixed price delivery orders.

3. Description of Supplies/Services:

MSC requires a broad range of Original Equipment Manufacturer (OEM) parts to support overhaul and repairs of pumps manufactured by Warren Pumps, LLC and IMO Industries, Inc.

currently installed aboard MSC Vessels. Both Warren Pumps Inc. and IMO Industries Inc.

operate under the parent company, CIRCOR Naval Solutions, LLC (CIRCOR). The pumps installed aboard MSC vessels include, but are not limited to: 413DVCS, 413RBCS, A3DBCS, A3DBCSX, A3DBS, A3DVCSX, C3EHCS, DA3DBCS, D3EBFS, D3EBCS, D3EHCS, D3EHFS, G3DBCS, G3DHCS, 2-1/2-DBH, 14-DBVB-16, 12-DBVB-18, 6-DBVB-15, 5-

DBVB-21, S133.66.6FGE-M060, 8-DBCN-22, 12-DTBM-14H, 14-DLBM-16, X 1-1/2 X 7,

and 25” VP.

The estimated total amount of this requirement is $ , which includes the entire five (5)-year ordering period. It is anticipated that each delivery order will be funded utilizing corresponding Fiscal Year (FY) United States Navy Working Capital Funds (NWCF) and/or

Transportation Working Capital Funds (TWCF).

4. Statutory Authority Permitting Other Than Full and Open Competition:

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(b), whereby parts sources are unique or parts are available from one (1) or a limited number of sources. This requirement will be sole-sourced from the OEM which is the only provider of these parts.

5. Rationale Justifying Use of Cited Statutory Authority:

This is not a new requirement. MSC has acquired the below systems/items for decades on an other than full-and-open competition basis using a series of J&As. Currently, the required systems/items required to maintain the pumps used in MSC vessels are procured through individual contracts and purchase orders utilizing other than full-and-open competition; an inefficient and administratively burdensome process. This J&A is designed to simplify acquisition by consolidating this recurrent requirement into a single J&A.

a. Warren Pumps LLC (2-1/2-DBH, 14-DBVB-16, 12-DBVB-18, 6-DBVB-15, 5-

DBVB- 21, S133.66.6FGE-M060, 8-DBCN-22, 12-DTBM-14H, 14-DLBM-16, 3 X

1-1/2 X 7, and 25” VP)

Basis. The table below shows the quantities and locations of each type of pump:

Pump Quantity Per

Ship Number of Ships Containing Pump

Total Quantity of Pumps

Class of Ships Containing Pump

2-1/2-DBH 4 15 60 T-AO

14-DBVB-16 2 15 30 T-AO

12-DBVB-18 2 15 30 T-AO

6-DVBV-15 2 15 30 T-AO

5-DBVB-21 3 15 45 T-AO

S133.66.6FGE-

M060

4 15 60 T-AO

8-DBCN-22 5 15 75 T-AO

12-DTBM-14H 2 7 14 T-AO

14-DLBM-16 1 8 8 T-AO

3 X 1-1/2 X 7 2 5 10 T-AKE

25” VP 2 2 4 T-AH

These pumps are used for moving various fluids including sea water, cooling water, cargo oil, hydraulic service, lubricating oil, and Ballast water. The OEM for these pumps is Warren Pumps LLC. Warren Pumps LLC is a subsidiary of CIRCOR. The engineering, construction drawings, and technical characteristics for the manufacture of parts for these pumps are the property of CIRCOR and its subsidiaries, making them the only known source. The Government did not acquire rights in the above-described proprietary data.

Rationale. CIRCOR provides OEM parts and technical data/drawings as required by the United States Coast Guard (USCG) and American Bureau of Shipping (ABS) regulations. This mandatory regimen maintains all OEM warranties and ensures equipment reliability and crew safety, therefore precluding consideration of non-OEM parts. Safety Management Systems (SMS) number 10.6-002-ALL lists the propulsion and mission and safety systems as critical equipment. Failure of pumps would affect operation of the propulsion and auxiliary and safety equipment and restrict the ship’s mobility, precluding the ship from meeting mission. Proper refurbishment and maintenance of the installed pumps are critical to the safe operations of these Vessels.

b. IMO Industries Inc. (413DVCS, 413RBCS, A3DBCS, A3DBCSX, A3DBS, A3DVCSX, C3EHCS, DADBCS, DA3DBCS, D3EBFS, D3EBCS, D3EHCS, D3EHFS, G3DBCS, G3DHCS.)

Pump Quantity Per Ship

Number of Ships Containing Pump

Total Quantity of Pumps

Class of Ships Containing Pump

413DVCS 4 15 60 T-AO

413RBCS 4 15 60 T-AO

A3DBCS 4 15 60 T-AO

A3DBCSX 4 15 60 T-AO

A3DBS 4 15 60 T-AO

A3DVCSX 4 15 60 T-AO

C3EHCS 3 1 3 T-AO

DADBCS 1 15 15 T-AO

DA3DBCS 3 3 9 T-AO

D3EBFS 4 15 60 T-AO

D3EBCS 3 15 45 T-AO

D3EHCS 3 3 9 T-AO

D3EHFS 3 3 9 T-AO

G3DBCS 1 15 15 T-AO

G3DHCS 1 15 15 T-AO

These pumps move various lubricating and hydraulic oils. The OEM for these pumps is IMO Industries. IMO Industries is a subsidiary of CIRCOR. The engineering, construction drawings, and technical characteristics for the manufacture of parts for these pumps are the property of CIRCOR and its subsidiaries, making them the only known source. The Government did not acquire rights in the above-described proprietary data.

Rationale. CIRCOR provides OEM parts and technical data/drawings as required by the United States Coast Guard (USCG) and American Bureau of Shipping (ABS) regulations. This mandatory regimen maintains all OEM warranties and ensures equipment reliability and crew safety, therefore precluding consideration of non-OEM parts. Safety Management Systems (SMS) number 10.6-002-ALL lists the propulsion and mission and safety systems as critical equipment. Failure of pumps would affect operation of the propulsion and auxiliary and safety equipment and restrict the ship’s mobility, precluding the ship from meeting mission. Proper refurbishment and maintenance of the installed pumps are critical to the safe operations of these Vessels.

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

a. For all systems/items identified in paragraph 5, and in accordance with FAR 5.201(b)(1)(i), MSC intends to issue a synopsis of proposed contract action (solicitation) on the Federal Business Opportunities (FBO) web portal. The stated intent will be to award one (1) requirements contract with firm fixed price delivery orders. One (1) response has been received in response to the sources sought notice, as described in section 8. MSC will continue to work with its contracting, engineering support, and program manager offices to identify potential manufacturing sources. Further, MSC frequently communicates with the industrial base to assure that all potential sources are identified and receive consideration for these requirements.

b. MSC does not have manufacturing and technical information required to evaluate and determine whether non-OEM systems/items potentially offered as equivalent to the OEM components and replacement parts are technically acceptable. These systems/items require special tools, specialized repair parts, and technical expertise unique to these pumps; only approved OEM parts are authorized to be installed for this highly sophisticated equipment. The OEM and the CIRCOR team have access to provide parts and technical data/ drawings for manufacture. All OEM repair parts are therefore to be in compliance with USCG, ABS, and International Maritime Organization (IMO) regulatory requirements.

7. Determination of Fair and Reasonable Cost:

The requirements contract will include pre-negotiated part prices. A fair-and-reasonable determination will be made using the techniques described in FAR 15.404-1. The Contracting Officer has surveyed the history of acquisitions for the above pumps, for which fair-and-reasonable determinations were individually established. The Contracting Officer will ensure that the base contract as well as any applicable delivery orders utilizing non-prenegotiated pricing is commensurate with the earlier pricing, adjusted for changed market conditions and inflation. In this way the Contracting Officer will determine that the price to the Government for the parts covered under this J&A will be fair-and-reasonable.

8. Actions to Remove Barriers to Future Competition:

For reasons set forth in Paragraph 5, MSC has no plans at this time to engage in full-and-open competition for this requirement. If another potential source emerges, with authorization from the OEM to provide parts for these pumps, MSC will assess whether additional competition for future requirements is feasible. A sources sought notice was posted to FBO from 13 October 2017 through 26 October 2017 requesting market research information from industry, including interested and capable sources, as well as suggested solutions to maintain these pumps. To date, one (1) response was received from BAE Systems. However, there is no evidence that BAE Systems can support these OEM pumps. BAE Systems did not demonstrate that the company possesses the requisite access to proprietary data/drawing and manufacturing and repair process rights to produce replacement parts for these pumps. Should BAE Systems, or any other firm, acquire authorization from the OEM to provide parts for these pumps, MSC will evaluate such source accordingly. The engineering, construction drawings, and technical characteristics for the above-described systems are proprietary to CIRCOR and its subsidiaries, making them the unique and only source for OEM parts. Again, the Government did not acquire rights in the above-described matters. The Government will continue to monitor the market and conduct market research to identify additional authorized sources and solutions, should they arise in the marketplace.

9. A Listing of the Sources, if any, that Expressed, in writing, an Interest in the Acquisition:

To date, no additional sources other than CIRCOR and BAE Systems, mentioned in paragraph 8 above, have been identified or expressed interest in this requirement. However, an intent to sole-source/presolicitation notice, and the solicitation will be issued via the Government Point of Entry, the FBO website, to afford maximum visibility and competition.