E2FO_TPPC-DDG111-SWRMC27-S001_Redacted_FINAL.pdf

Exception to Fair Opportunity Template Update MAY 2026

JUSTIFICATION for an EXCEPTION to FAIR OPPORTUNITY for the placement of an order over the micro purchase threshold (MPT) under a Multiple Award Contract

(MAC)

Upon the basis of the following justification, as a Contracting Officer of Southwest Regional Maintenance Center (SWRMC), I hereby approve the Justification for an Exception to Fair Opportunity Pursuant to FAR 16.505(b)(2).

JUSTIFICATION

l. Agency and Contracting Activity. Department of the Navy, Southwest Regional Maintenance Center (SWRMC).

2. Nature/Description of Action. This is a fair opportunity exception to place an order with prospective Multiple Award Contract Indefinite Delivery/Indefinite Quantity (MAC-IDIQ) holder National Steel and Shipbuilding Company (NASSCO) under MAC-IDIQ number N00024-22-D-4447 for the USS SPRUANCE (DDG-111) Fiscal Year 2027 (FY27) Continuous Maintenance Availability (CMAV) S001.

3. Description of Supplies/Services. The estimated value of this CMAV is based on the Independent Government Estimate (IGE) from the SWRMC Project Manager. Funding will be FY27 OM&N D8 in support of the USS SPRUANCE FY27 CMAV availability. The tentative availability schedule is . The Government's minimum needs have been verified by the certifying technical and requirements personnel.

4. Identification of the Exception to Fair Opportunity. (FAR 16.505 (b)(2))

a. The agency need for services is of such urgency that providing fair opportunity would result in unacceptable delays.

The scheduled Continuous Maintenance Availability (CMAV) with delivery schedule will partially coincide with the Incremental Selected

Availability (ISRA) for USS SPRUANCE (DDG-111) which is scheduled to start Awarding the CMAV availability to the same contractor will significantly reduce schedule risk to the ISRA, will ensure continuity of effort, and optimize resource utilization.

Since the ISRA is scheduled to start approximately four (4) days prior to the completion of the CMAV, there are numerous risks of unacceptable delays to the ISRA availability. Work Items 721-31-001, 721-31-002, and 441-71-001 regarding the VLS launcher tops, uptake hatches, and scaffolding support are crucial to the successful timely completion of the ISRA which is scheduled to start .

Critical path of the ISRA is completion of large-scale replacement and preservation of the Flight II Vertical Launch System (VLS) and MK 41 Launcher Top and Uptake Hatches. The VLS serves as the primary physical offensive and defensive mechanism of the ship, allowing near-instantaneous preparation and launch of multiple missile types. Three (3) work items in the CMAV package directly relate to the completion of the VLS replacement and preservation. The Government must complete these three (3) CMAV work items to ensure system continuity and readiness ahead of the ISRA maintenance period.

These work items are planned into the CMAV package to reduce schedule risk associated with the degree of repairs within the ISRA availability. Since NASSCO is already scheduled to perform the VLS work integrated in the ISRA availability, they will already have the necessary equipment, reference drawings, sequencing, and infrastructure established to complete the work within the CMAV package. This will provide NASSCO a seamless transition from completion of CMAV to the start of the ISRA availability.

In addition, Work Item 721-31-001 and 721-31-002 require completion of unobstructed flow tests, removal of each uptake hatch, removal of faring plate and trough plate, preservation of the disturbed surfaces, reinstallation of the faring plates, and accomplishment of another flow test on the faring plates. While these repairs may be completed during the CMAV, the multiple testing required on the faring plates must be executed during a sea trial period during the ISRA availability. Given that NASSCO will be the prime contractor for the ISRA availability and responsible for managing and executing the required testing, one contractor accomplishing all repairs and testing will avoid unacceptable delays, avoid duplicate efforts, mobilization costs, and potential delays in providing a separate contractor access to the vessel after the CMAV completes. Additionally, if the necessary overhaul work is not accomplished during the CMAV, prior to the planned ISRA, it will trigger a cascading failure of missed execution milestones during the integrated production schedule and cause severe compounding downstream of unacceptable delays to PACFLEET operational schedule.

Given the overlap between the ending of the CMAV, , and the start of the ISRA, , awarding this to another contractor unfamiliar with USS two (2) availabilities increases the risk of significant delays, create potential conflict and confusion of priorities, and therefore may jeopardize on-time delivery. Since both the CMAV and ISRA will require temporary services installed throughout the ship, there will be competing priorities between the CMAV and ISRA. Awarding the CMAV to NASSCO will further reduce schedule risk to critical path overhaul of the VLS by allowing NASSCO to maintain continuous service and equipment setup, avoiding possible delays associated with demobilization and reinstallation of temporary services.

Awarding the CMAV for USS SPRUANCE (DDG-111) to NASSCO on a sole source basis will avoid unacceptable delays. The VLS overhaul and testing comprise most of the work being accomplished on the CMAV and those work items tie directly to the ISRA that NASSCO is currently planning efforts in anticipation of start date . Because the CMAV S001 directly dictates the scope and success of the ISRA, awarding to a separate contractor would significantly increase integration issues leading to potential schedule risk.

Allowing NASSCO to integrate the CMAV schedule into the start date for the ISRA on will significantly reduce schedule risk to the Government and reduce unacceptable and costly delays. NASSCO possesses the unique knowledge required to address the complexity of early planning support of deliverables and can meet the 16 week demand to remove, replace, and certify the VLS uptake hatches as required in the CMAV.

Sole sourcing this CMAV to NASSCO provides the most feasible solution because NASSCO would already be in the position to complete the scheduled ISRA availability with support services already in place. Failure to complete the three (3) crucial work items regarding the VLS launchers and hatches during the ISRA will negatively impact the PACFLEET operational schedule if the ship is not delivered on time.

b. Only one such awardee is capable of providing such services required at the level of quality required because the services ordered are unique or highly specialized.

c. The order must be issued on a sole-source basis in the interest of economy and efficiency as a logical follow-on to an order already issued under the MAC, provided that all the awardees were given fair opportunity to be considered for the original order.

d. It is necessary to place an order to satisfy a minimum guarantee.

e. For orders exceeding the simplified acquisition threshold, a statute expressly authorizes or requires that the purchase be made from a specified source.

5. Determination of Fair and Reasonable Cost. A thorough review and analysis, with regard to price and scope, of the pricing information provided by NASSCO will be conducted by the Project Team (PT) and verified by the Contracting Officer. Determination of fair and reasonable costs will primarily be accomplished by use of parametric methods used to determine reasonableness of labor hours, materials, and times proposed by NASSCO, in accordance with FAR 15.404-1(b)(3). Furthermore, application of rough yardsticks will be utilized for significant inconsistencies that warrant additional pricing inquiries in addition to reviewing any historical pricing information for NASSCO that is available, as well as similar work accomplished by other contractors. This analysis will be accomplished in conjunction with comparison of all proposed labor hours and material by the PT with verification by the Contracting Officer.

6. Any Other Facts Supporting the Justification. Operational commitments prevented a full assessment of the VLS prior to developing the work package for the ISRA.

7. Actions Taken to Remove or Overcome Barriers that Led to the Exception to Fair Opportunity. While standard procedures would follow the typical solicitation process providing fair opportunity to the MAC-IDIQ contract holders, incorporating this critical maintenance work to meet and support the upcoming ISRA for the USS SPRUANCE will avoid unacceptable delays. Given the overlap between the ending of the CMAV, , and the start of the ISRA, , awarding this to another contractor unfamiliar with USS

(2) availabilities increases the risk of significant unacceptable delays and jeopardizes on-time delivery. This is an atypical event and could not be planned or forecasted, accordingly, the ACO determined that this course of action is the most prudent way forward in this instance.