Redacted_JA_Staco.pdf

J&A Number: 0232-15-050-00

Code: 0222

P.R. Number: 17-JWM-001

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity

The Naval Sea Systems Command, Naval Surface Warfare Center, Philadelphia Division

(NSWCPD) Code 0222

2. Description of Action Being Approved

Award of a sole source, Firm Fixed Price (FFP) Indefinite Delivery, Indefinite Quantity (IDIQ) contract for Original Equipment Manufacturer (OEM) Propulsion Systems Interface and Steering

Control hardware components to Staco Systems of Irvine, CA 92618.

3. Description of Supplies/Services

The items being purchased under the proposed contract action are manufactured by Staco

Systems. Staco Systems will be required to provide hardware items in support of Propulsion

Systems Interface and Steering Control Systems currently installed on the following ship classes:

Aircraft Carrier, Nuclear Powered (CVN); Landing Ship, Dock (LSD); Amphibious Transport

Dock (LPD); and Multi-Purpose Amphibious Assault Ship (LHD). Also, Staco Systems items will be installed at NSWC Philadelphia land based test facilities, to replicate the shipboard environment for integration and cybersecurity related testing. Staco Systems will provide data conversion hardware equipment and associated components and supporting product technical manuals.

Hardware Maintenance is also included on this contract to allow the manufacturer to provide repair services to the associated equipment. This includes the assessment and repair of any equipment that is returned to the manufacturer due to failure.

DEPARTMENT OF THE NAVY

NAVAL SURFACE WARFARE CENTER

PHILADELPHIA DIVISION

5001 SOUTH BROAD STREET

PHILADELPHIA PA 19112-1403

IN REPLY REFER TO:

The proposed action will utilize a five (5) year contract without incorporation of any option periods. The items to be procured over a five (5) year period under the proposed contract action are as follows:

Yr 1

Qty

Yr 2

Qty

Yr 3

Qty

Yr 4

Qty

Yr 5

Qty

TOTAL

Max Qty

Item

37 37 37 37 37 185 EOT/POT Panel (Stbd)

37 37 37 37 37 185 EOT/POT Panel (Port)

37 37 37 37 37 185 Bridge Manual Pump Controller

(CVN/LHD; 4 HPUs)

37 37 37 37 37 185 Bridge Manual Pump Controller

(LSD; 2 HPUs)

37 37 37 37 37 185 SCDU Indicator (Local)

37 37 37 37 37 185 SCDU Indicator (Remote)

37 37 37 37 37 185 SCDU Mounting Spacer - Special

37 37 37 37 37 185 Series 200 Indicator Assembly

(Spare)

500 500 500 500 500 2,500 hrs Hardware Maintenance

100 hrs 100 100 100 100 500 hrs ODC/Travel

The total estimated dollar value of this requirement is $12,218,000. The following is a breakdown of the estimated funding amounts for this proposed contract action:

Estimated Dollar Value

Funding

Type

FY17 FY18 FY19 FY20 FY21 Total

SCN $977,480 $977,480 $977,480 $977,480 $977,480 $4,887,400

OPN $977,480 $977,480 $977,480 $977,480 $977,480 $4,887,400

RDT&E $244,370 $244,370 $244,370 $244,370 $244,370 $1,221,850

O&MN $244,370 $244,370 $244,370 $244,370 $244,370 $1,221,850

Totals $2,443,700 $2,443,700 $2,443,700 $2,443,700 $2,443,700 $12,218,500

The Government’s minimum needs have been verified by the certifying technical and requirements personnel. The minimum guarantee order for this IDIQ contract will be

$100,000.00. Completion dates are not feasible to predict at this time due to the IDIQ nature of this procurement.

4. Statutory Authority Permitting Other Than Full and Open Competition

10 U.S.C. 2304(c)(1), Only One Responsible Source and No Other Sources and Services Will

Satisfy Agency Requirements, as implemented by Federal Acquisition Regulation (FAR)

Subpart 6.302-1.

5. Rationale Justifying Use of Cited Statutory Authority

Staco Systems hardware is an integral part of Propulsion Systems Interface and Steering Control

Systems installed on numerous ship platforms in the U.S. Navy. Staco Systems, as the Original

Equipment Manufacturer (OEM), is the sole designer and fabricator of this equipment, and as such, possess the proprietary technical data necessary to manufacturer and provide maintenance for this specialized equipment. The Technical Data Rights for this equipment are not available to the Navy, as the OEM has chosen to retain proprietary rights.

Due to the lack of sufficient technical data, it is impossible to ensure hardware obtained from any other source would possess the essential interoperable design and functional properties necessary for the current requirement. In addition to being cost prohibitive, this would result in the introduction of technical risk. As this is Propulsion Systems Interface and Steering Control

Systems hardware, the Navy cannot afford the risk associated with hardware compatibility.

As this hardware was designed and fully funded without Government funding, Staco Systems is not amenable to releasing the proprietary technical data information to the Government.

Based on the information above, Staco Systems is the only Contractor that can perform the efforts associated with the specifications under this requirement.

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

A Request for Information (RFI)/ Sources Sought was posted to the Federal Business

Opportunities (FedBizOps) website on 20 October 2016. Additionally, a synopsis of this procurement was published on the FedBizOps website on 18 November 2016. To date, there was one response from New Tech Solutions (NTS) obtained as a result of the RFI/ Sources Sought notification. The Government reviewed NTS’s capabilities in regards to this requirement. NTS was notified via email with a NSWCPD letter dated 5 January 2016 stating that the Government deemed that NTS does not possess the proprietary data rights in order to meet the requirements of the solicitation. They were instructed to respond by 8 January 2016 if they had any questions concerning the Government’s decision. NTS did not respond by the required date and therefore the Government determined NTS was not a viable source for this requirement.

Market research was conducted by NSWCPD Code 525 and proved unsuccessful in identifying alternate sources capable of providing all of the required hardware components. Three (3) companies were identified as potential vendors for the required hardware components based on previous support provided to the Navy. However, due to incompatibility with current ship installed hardware and non-environmentally qualified items, these firms were deemed unable to support the requirements, availability and installation support schedule for this equipment.

7. Determination of Fair and Reasonable Costs

The Contracting Officer will determine whether the cost to the Government for the supplies/services covered by this Justification and Approval will be fair and reasonable prior to award in accordance with FAR 15.402 & 15.404. The Contractor will submit a formal price proposal with certified cost or pricing data and sufficient information to support the accuracy and reliability of the estimate. Defense Contract Management Agency pricing assistance and/or

Defense Contract Audit Agency audits of the Contractor’s proposal will be requested along with the Offeror’s certificate of current cost or pricing data. The Contractor’s proposal will be reviewed by experienced technical analysts, cost analysts, and a contract specialist with the aid of necessary field pricing support including historic pricing. The Contracting Officer will utilize cost and price analysis as the basis for negotiating a fair and reasonable price.

8. Actions to Remove Barriers to Competition

Efforts are currently in progress for the Government to develop, own and control all interface specifications and hardware design requirements for all related Propulsion Systems Interface and

Steering Control Systems. Progress has been made in the last year. However, the Government still cannot support procurement requirements related to shipboard installations scheduled between 2017 and 2022. When these efforts become more mature and are able to provide specific direction and requirements to future engineering requirements, open competition for all

Propulsion Systems Interface and Steering Control Systems related efforts will be possible. It is anticipated that a competitive environment will exist within the next five (5) years. However, until this occurs, it is essential that the Government continues to rely on Staco Systems to provide the existing certified hardware components. The circumstances surrounding the need to obtain the required supplies/services without providing full and open competition will be reviewed annually by the Contracting Officer.

It should be noted that NSWCPD Code 525 plans to develop a Level III Build-To-Print

Technical Data Package (TDP) or Performance Based Specification (PBS) that will support competition for future acquisitions of the same or similar items. This TDP is expected to be available in the third-quarter of Fiscal Year 2020 and the first competitive acquisition is planned to be solicited around the first-quarter of Fiscal Year 2021. All components to be acquired must still satisfy all environmental tests for ATO eligibility.

CERTIFICATIONS AND APPROVAL

TECHNICAL/REQUIREMENTS CERTIFICATION (FAR 6.303-2(c)):

I certify that the facts and representations under my cognizance, which are included in this justification and its supporting acquisition planning data, including Acquisition Plan No. N/A , except as noted herein, are complete and accurate to the best of my knowledge and belief.

COMBINED TECHNICAL AND REQUIREMENTS COGNIZANCE:

215-897-7460

Signature: CHRISTOPHER J SAVAGE Phone No. Date

Department Head (Code 50)

LEGAL SUFFICIENCY REVIEW (NMCARS 5206.303(90)):

I have determined that this justification is legally sufficient.

215-897-5210

Signature: HOWARD REIN Phone No. Date

Office of Counsel (Code 00L)

CONTRACTING OFFICER CERTIFICATION (FAR 6.303-2(b)(12)):

I certify that this justification is accurate and complete to the best of my knowledge and belief.

215-897-8437

Signature: JOHN STEFANO Phone No. Date

Contracting Officer (Code 0221)

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).

CHIEF OF THE CONTRACTING OFFICE

Signature KAREN GUTMAKER Date

CHIEF OF THE CONTRACTING OFFICE (Code 02)