JA_0232-19-188-00_HPAC_Repair_(Overhaul)_FINAL_Redacted.pdf

J&A Number: 0232-19-188-00

Code: 0232

P.R. Number: 19-J L-002

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

JUSTIFICATION

1. Contracting Activity

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

(NSWCPD), Code 0232

2. Description of Action Being Approved

Award of a Firm-Fixed-Price (FPP) contract on a sole source basis to Sauer Compressors USA

Cage Code (1KWT0), 64 Log Canoe Cr Stevensville, MD 21666-2136 United States for four (4)

High Pressure Air Compressors (HPACs) which will be overhauled with the 8000-hour overhaul kit. This contract is in support of NSWCPD's mission as MCS Life Cycle Manager (LCM).

3. Description of the Supplies or Services

This requirement will provide for the furnishing of services, to include: labor, material, and support to overhaul, troubleshoot, and test four (4) SAUER WP5000 HPACs onboard

(CVN ). Sauer Compressor USA is the original equipment manufacturer

(OEM) of the model WP500 HPAC to be overhauled for this requirement.

The Governments minimum needs have been verified by the certifying technical and requirements personnel. This acquisition is to satisfy the requirements of the NSWCPD and does not authorize acquisitions for other requirements.

MOPAS Acquisition Strategy Plan # 0232-19-188-00.1 covers this acquisition.

The total estimated dollar value of this procurement is $784,000.00 as indicated below.

DEPARTMENT OF THE NAVY

NAVAL SURFACE WARFARE CENTER

PHILADELPHIA DIVISION

5001 SOUTH BROAD STREET

PHILADELPHIA PA 19112-1403

IN REPLY REFER TO:

Estimated Dollar Value

Total Percent

FY19 SCN $784,000 100.00%

The Period of Performance (POP) for this effort will be 1 (one) year from the date of award.

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

Sauer Compressors USA equipment is critical to operation of U.S. Navy shipboard systems. Sauer

Compressors USA is the original equipment manufacturer (OEM) and has been found to be the only vendor that can perform this highly specialized type of services onboard naval Nimitz class aircraft carriers while meeting the Navy's standards. Sauer Compressors USA designed the equipment covered by this proposed acquisition and owns the special tooling and Genuine Sauer

Spare Parts required to service the equipment. All the detailed design information, which includes manufacturing procedures and methods, was developed by Sauer Compressors USA. Sauer

Compressors USA has unique highly specialized knowledge and experience to provide troubleshooting, repairs, and unit redesigns. Award to any other source would result in a substantial duplication of cost to the Government that is not expected to be recovered through competition or unacceptable delays in fulfilling the agency’s requirements.

Not using the OEM’s highly specialized services on this overhaul would greatly increase the possibility of catastrophic failure at time of testing, which would triple the labor and double the parts costs. In addition, developing an alternative source would not be practical since it would result in a substantial duplication of cost to the Government that is not expected to be recovered through competition. The development of an alternative source would also result in unacceptable delays in the furnishing of the support services covered by the proposed acquisition.

For example, development of an alternative source for HPACs requirements would necessitate extensive duplication of effort. Based on previous experience, the time required for the redevelopment is provided below:

Estimated HPAC Overhaul Schedule

Task Duration

HPAC Overhaul 12 months

Developmental Testing 6 months

HPAC Testing 1 month

Total Duration 19 Months

Estimate Duplicate Development, Integration and Sustainment Costs

Non Recurring Engineering $120,000

Initial Build and Delivery $25,000

ISEA Integration and Testing $95,000

Procurement of New Equipment $630,000

Total Cost $870,000

The results in the two tables above show that redevelopment would require approximately

$870,000 in duplicative costs to the Government in order to develop other sources of support under a competitive effort. Additionally, it is evident that the Government would face great risk in waiting 19 months to develop alternate systems, and would require additional resources to test them fully to integrate them, all while the currently delivered Sauer Compressors USA equipment would continue to be fielded and utilized in production to the Fleet. Accordingly, Sauer Compressors USA is considered to be the only source capable of providing the required services.

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

Market research was conducted through a survey and analysis of alternative equipment sources that are available in industry. The thorough analysis conducted a review of the available sources to see if there were any possible alternatives. Additionally, several companies were surveyed to see if they would be able to provide a satisfactory solution. At this time, no other sources exist to satisfy the need.

As required by FAR Part 10, a Request for Information/Source Sought was posted to the Federal

Business Opportunities (FEDBIZOPS) website on 16 January 2019 with responses due on 30

January 2019. One contractor, Sauer Compressors USA, submitted a capabilities statement in response to the Sources Sought posting. Sauer’s capability was deemed satisfactory by the technical subject matter expert.

7. Determination of Fair and Reasonable Costs

The Contracting Officer will make a determination as to whether the costs to the Government for the supplies covered by this J&A are fair and reasonable, prior to award. The contractor will submit a formal price proposal with certified cost or pricing data sufficient to support the accuracy and reliability of the estimate. The contractor’s proposal will be reviewed by experienced technical analysts and contract specialists with the aid of necessary field pricing support. The PCO will use historical pricing for similar quantities of this requirement previously purchased from this Offeror as the basis for negotiating a fair and reasonable price.

8. Actions to Remove Barriers to Competition

The NSWCPD has assessed potential sources through market research analysis, but for reasons set forth in Section 5, including the specialized nature of this work, unacceptable delays, substantial risks, and duplication of costs to the Government, NSWCPD has no plans to compete contracts for the types of services covered by this justification. NSWCPD, as part of its enduring mission as

LCM, will continue to monitor the marketplace and identify other potential sources of the services identified in this justification, where and when practical. Any sources discovered that can potentially satisfy this specific procurement will be taken into account for any future requirements.

TECHNICAL AND REQUIREMENTS CERTIFICATION - (FAR 6.303-2(c))

I certify that the facts and representations under my cognizance, that are included in this justification and its supporting data, including AP/MOPAS No. 0232-19-188-00.1, except as noted herein, are complete and accurate to the best of my knowledge and belief.

COMBINED TECHNICAL AND REQUIREMENTS COGNIZANCE:

Phone No. Date

LEGAL SUFFICIENCY REVIEW (NMCAR 5206.303-90)

I have determined that this justification is legally sufficient.

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.

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(s) using other than full and open competition, pursuant to the authority of 10 U.S.C. 2304(c)(1).

CHIEF OF THE CONTRACTING OFFICE

Karen Gutmaker, Chief of the Contracting Office, Phone No. Date