Sole-Source Justification for SAP Procedures using FAR 13.5_Alameda Refuse_Redacted.pdf

SOLE SOURCE (INCLUDING BRAND NAME) JUSTIFICATION

FOR CERTAIN COMMERCIAL PRODUCTS AND SERVICES

April 2025

1. IDENTIFICATION OF AGENCY AND CONTRACTING ACTIVITY:

The Naval Facilities Engineering Systems Command, Southwest proposes to enter a sole-source contract under simplified acquisition procedures for trash collection commercial services.

2. NATURE/DESCRIPTION OF CONTRACT ACTION:

This is a sole source action for Alameda County Industries, Inc. conducted using the procedures of FAR subpart 13.5. The placement of a fixed price order is anticipated.

3. DESCRIPTION OF REQUIRED SUPPLIES/SERVICES:

Refuse Collection and Disposal for the Navy Reserve’s area of operation within Alameda County. There is a base period from 01 July 2025 through 30 June 2026. There are seven (7) consecutive 12-month option periods followed by a 6-Month Option Period:

Base Period: 01 July 2025 – 30 June 2026 Option Period One: 01 July 2026 – 30 June 2027 Option Period Two: 01 July 2027 – 30 June 2028 Option Period Three: 01 July 2028 – 30 June 2029 Option Period Four: 01 July 2029 – 30 June 2030 Option Period Five: 01 July 2030 – 30 June 2031 Option Period Six: 01 July 2031 – 30 June 2032 Option Period Seven: 01 July 2032 – 30 June 2033

Option Period Eight: 01 July 2033 – 31 December 2033

4. IDENTIFICATION OF THE STATUTORY AUTHORITY PERMITTING OTHER

THAN FULL AND OPEN COMPETITION:

This action is conducted pursuant to 41 U.S.C 1901 (Simplified Acquisition Procedures).

Specifically, this procurement uses the Commercial Item Exception under FAR 13.5: There is a specific exception under FAR 13.5 (Simplified Procedures for Certain Commercial Items) that allows for the use of simplified procedures for commercial items above the simplified acquisition threshold (SAT), but below a higher threshold (herein referred to as the upper authority threshold). This is often called the "test program" or "special authority" for commercial items.

The upper authority threshold value for the FAR 13.5 special authority is $7.5 million.

Here, the estimated dollar value of this proposed acquisition is only slightly above the SAT and well below the upper authority threshold.

Conditions for Using FAR 13.5: Using this higher dollar range between SAT and the upper authority threshold is not automatic. It is subject to very specific conditions and limitations.

Agencies must have specific authority to use FAR 13.5 procedures for acquisitions between the SAT, currently at $250,000 to the upper authority threshold of $7.5 million.

April 2025

This authority often comes from a specific statute, or a class deviation granted by the FAR Council. In satisfaction with this requirement: NAVFAC COMMERCIAL ITEMS CONSIDERATIONS was released on 19 November 2019. It has been saved into the official file of this acquisition under Tab 05 – D&F and J&A with the title: “NAVFAC Commercial Item Determination - TRASH COLLECTION.” The document, issued by NAVFAC Leadership in 2019, determines that trash collection qualifies as other services which may be considered commercial items. Thus, per NAVFAC direction, this acquisition’s scope of work falls within the commercial items determination required for FAR 13.5.

Increased Competition: An agency using FAR 13.5 must solicit offers from as many potential sources as practicable. This requirement has been met because the area of responsibility (i.e. the City of Alameda) is currently required to use one company for waste collection under a franchise agreement. Thus, the number of potential sources has been limited due to the practicable implications of a franchise agreement.

5. DEMONSTRATION THAT THE PROPOSED CONTRACTOR’S UNIQUE

QUALIFICATIONS OR NATURE OF THE ACTION REQUIRES USE OF THE

AUTHORITY CITED:

This action is subject to the terms of an exclusive licensing agreement. Alameda County Industries, Inc. (ACI) has exclusive rights to service the County of Alameda for waste disposal services. ACI has been granted the exclusive right to provide refuse collection, disposal, and recycling services within the City of Alameda. This exclusivity is tied to a franchise agreement that governs the provision of waste management services, ensuring compliance with local regulations and environmental standards. No other company is authorized to perform these services within the jurisdiction without violating the franchise agreement.

ACI is the sole authorized provider of these services under the terms of the franchise agreement which has been granted by the local government of Alameda. As a result, there are no alternative providers that can offer the waste collection service nor are any other service providers legally permitted to operate within the City of Alameda.

6. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS IS PRACTICABLE,

INCLUDING WHETHER A NOTICE WAS OR WILL BE PUBLICIZED AS

REQUIRED BY FAR SUBPART 5.2 AND, IF NOT, WHICH EXCEPTION UNDER FAR

5.202 APPLIES:

The Government does not wish to violate the terms of the existing Franchise Agreement as described herein. It was a concern held by the acquisitions team that publicizing an already franchised and licensed requirement would be a violation of the City’s agreement for refuse collection services.

There is not a specific FAR clause that directly provides a blanket exception to publicizing a contract opportunity solely because the work is licensed to a contractor via a franchise agreement. The existence of a franchise agreement itself is not sufficient justification to avoid publicizing a contract opportunity. However, there are some indirect ways a franchise agreement is relevant in determining whether an exception to publicizing applies:

April 2025

Here, the unique nature of the franchise agreement and the specific requirements of the government contract make the franchisee the only responsible source. This determination is based on the proposed acquisition’s required area of responsibility for refuse pickup being soley within the area of the ACI’s franchise agreement with the City of Alameda. Thus, due to the geographic area of responsibility, the Navy has demonstrated that the specific services required are so intrinsically tied to the franchise agreement that no other source could provide them.

Because of the location of the Navy Reserve bases in Alameda County, the contract requirement demands specific waste management services that are exclusively available through the franchise agreement, and there are no acceptable alternatives.

Thus, the exception applies.

FAR 6.302-1 - Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements: If the franchise agreement creates a situation where only the franchisee can meet the government's minimum needs, this statutory exception to full and open competition could potentially be invoked.

In Alameda, refuse services, including garbage, recycling, and composting, are provided by ACI.

ACI offers both residential and commercial collection services, with mandatory curbside collection for trash, recycling, and compost, as required by the Alameda County Waste Management Authority. In compliance with California Senate Bill 1383, Alameda requires all businesses and residences to subscribe to and participate in curbside collection of recyclables and compostable materials, including food scraps.

The only way for the Government to comply with the Senate Bill in the Alameda area of operation is for the Navy to utilize the services provided by the Alameda County Waste Management Authority through ACI.

Thus, competition is not feasible and the franchisee is the only acceptable source.

Online market research was conducted to verify that ACI was indeed the only available trash collection servicer in the Navy’s area of operation for this contract requirement:

- The City of Alameda Zero Waste Program Website https://www.alamedaca.gov/Departments/Public-Works-Department/Zero-Waste- Program-and-Services

- Alameda County Industries Website https://alamedacountyindustries.com/alameda/contact/

April 2025

- Alameda County Waste Program Website:

https://www.acgov.org/wasteprogram/

A franchise agreement, in and of itself, does not automatically exempt a contract opportunity from the publicizing requirements of the FAR. However, the acquisition team’s research reveals the franchise agreement, combined with the geographic requirements of the contract requirement, justifies an exception based on there being only one responsible source in the area of operation for the acquisition requirement.

7. DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE.

The Contracting Officer determines that the anticipated prices will be fair and reasonable based on Alameda County Industries & the City of Alameda established published rates effective from July 1, 2024 through June 30, 2025 and upcoming published rates from July 1, 2025 through June 30, 2026.

8. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE

RESULTS OR A STATEMENT OF THE REASON MARKET RESEARCH WAS NOT

CONDUCTED.

Market research was conducted as described in Section 6. There is only one contractor that can fulfill the Navy’s needs due to the franchise agreement between the City of Alameda and ACI.

9. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN

COMPETITION:

The franchise agreement between the City of Alameda and ACI described herein.

10. A LISTING OF THE SOURCES, IF ANY, THAT EXPRESSED, IN WRITING, AN

INTEREST IN THE ACQUISITION:

No other sources expressed such interest and no sources were sought as described herein.

11. A STATEMENT OF ANY ACTIONS THE AGENCY WILL TAKE TO REMOVE OR

OVERCOME ANY FUTURE BARRIERS TO COMPETITION: