P03-36C249-22-AP-1694-Veterinarian Services-FAR13 5_JA_OVER_SAT-596-Rev.1-BC Signed_Redacted.pdf

VHAPG Part 813.5 Simplified Acquisition Procedures for Certain Commercial Items Attachment 1: Request for Sole Source Justification >SAT-$7.5M under FAR13.5

DEPARTMENT OF VETERANS AFFAIRS

SOLE SOURCE JUSTIFICATION UNDER SIMPLIFIED PROCEDURES FOR CERTAIN COMMERCIAL

ITEMS IN ACCORDANCE WITH FAR 13.5

Acquisition Plan Action ID: 36C249 Veterinarian Services - 596_______

1. Contracting Activity: Department of Veterans Affairs, VISN 09, Lexington (Troy Bowling Campus) Veterans Affairs Medical Center (VAMC), Research & Development Services, located at 1101 Veterans Drive, Lexington, KY 40502-2235, Network Contracting Office (NCO) 9.

2. Nature and/or Description of the Action Being Processed:

This procurement is for the services of the University of Kentucky (UK) to provide Veterinarian care to maintain the health of research animals and ensure the integrity of research project under a sharing agreement. In accordance with FAR 13.5 Simplified Procedures for Certain Commercial Items and specifically FAR 13.501 Special Documentation Requirements, where acquisitions conducted under Simplified Acquisition Procedures are exempt from the requirements of FAR Part 6, but still require a justification using the format of FAR 6.303-2.

This action is to sole source a new requirement under a firm-fixed price agreement for a Veterinarian to provide operational oversight (daily maintenance, housing of research animals, furnishing food, water, husbandry and daily sanitation of cages) for all animals provided by UK for Lexington’s Veterans Affairs (VA) Research.

Base Ordering Period: 10/01/2022 through 09/30/2023 Ordering Period 1: 10/01/2023 through 09/30/2024 Ordering Period 2: 10/01/2024 through 09/30/2025 Ordering Period 3: 10/01/2025 through 09/30/2026 Ordering Period 4: 10/01/2026 through 09/30/2027

3. Description of Supplies/Services Required to Meet the Agency’s Needs:

Veterinarian services needed to provide operational oversight in accordance with standards of American Association for Accreditation of Laboratory Animal Care (AAALAC), and meet or exceed those outlined in The Guide of Care and Use of Laboratory Animals. The Veterinarian shall also serve as a voting member on the VA Institutional Animal Care and Use Committee (IACUC). This position will provide consultation Research Investigator’s on submitted protocol items, work with the IACUC coordinator on yearly reports, perform monthly inspections of the VA Veterinary Medical Unit (VMU), amongst other required Veterinarian duties outlined in VHA Handbook 1200.07.. Additionally, these services must also be provided on a 24/7 basis. UK has quoted a total for a five year agreement, which is 17.5% lower than the current market cost .

4. Statutory Authority Permitting Restricted Competition:

FAR 13.5 Simplified Procedures for Certain Commercial Items. The statutory authority for applying the Simplified Procedures for Commercial Items of FAR 13.5 is 41 U.S.C. § 1901 and is implemented by FAR 13.106-1(b)(2) for restricting competition on this procurement. Competition is restricted on this procurement for the reason below:

(X) Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements

( ) Unusual and Compelling Urgency ( ) Industrial Mobilization, Engineering, Developmental or Research Capability or Expert

Services ( ) International Agreement ( ) Authorized or Required by Statute ( ) National Security ( ) Public Interest

5. Demonstration that the Contractor’s Unique Qualifications or Nature of the Acquisition Requires the Use of the Authority Cited Above (applicability of authority):

The following techniques were performed to determine the capabilities of any small business capable of performing these services and to identify the unique nature of this requirement. NAICS 541940 “Veterinary Services” was selected as the principle code for this requirement. These services provide veterinary support services for ongoing Research & Development; therefore, any potential source must be located within proximity of the Lexington VA facility. Thereby resulting in the state of Kentucky being strictly enforced.

Utilizing the above stated criteria, VIP, GSA, DSBS, VA SCMC, and FPDS were all searched to determine capabilities of SDVOSB, VOSB, and any other type of SB Concern. Of these, VIP, VA SCMC, and GSA searches were the only ones that produced potential sources; however, the source from VIP did not respond to a Market Research email; VA SCMC was for VISN 22 only; and the sources from GSA are primarily engaged in R&D testing that involves the use lab animals and not their care.

VIP breakdown of search resulted in 10 sources all SDVOSB's; however, when restricting to the primary location of Kentucky only 1 SDVOSB met that criteria. As a result, a Market Research Email was sent to that source and it produced no responses. GSA search resulted in all Large Business sources; however, these sources were only involved in lab services. The VA SCMC search did produce one source, the University of Arizona;" however, contract# was specifically for use by VISN 22 only.

The evidence provided above outlines the findings of Market Research that supports the lack of expectation to meet the VA’s Rule of Two or any other Small Business Concern thereby dissolving the potential for a set-aside. However, since these services are currently being performed by an affiliate the University of Kentucky, under a stand-alone service contract with an existing Memorandum of Understand between the VA's Research & Development Services and the University of Kentucky, these services shall be procured as a sole source award.

6. Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable:

Intent to Sole Sources Synopsis: was posted on the 26th of March, 2022 under action ID# 36C24922Q0262. This notice provided the Governments intent to award a Firm-Fixed Price agreement to the University of Kentucky located at 800 Rose Street, Lexington, KY 40508 to provide a sharing agreement for Veterinarian services. Within this notice it stated any interested parties may identify their interest by responding no later than the 8th of April, 2022. This notice resulted in zero responses from any other potential sources.

7. Determination by the CO that the Anticipated Cost to the Government will be Fair and Reasonable:

There are three aspects to consider on this requirement when making a determination of fair and reasonableness pricing. The first aspect is the actual need as listed within the Statement of Work. To provide Veterinary care 7 days a week, 24 hours a day for 365 days per year for these research animals.

This care is onsite for animal housed at the Lexington VA and UK DLAR facilities of which must be in compliance with the American Association for Accreditation of Laboratory Animal Care (AAALAC) and the Veterans Health Administration (VHA) standards. These facilities and services must meet all applicable federal requirements that revolves around conducting research with animals and each parties Institutional Animal Care and Use Committee’s (IACUC).

Based on this, a full time equivalent (FTE) according to www.usajobs.gov estimates a yearly Veterinarian salary with a range depending on qualifications. At the lower end of this range the yearly cost is 9.6% higher than one estimated ordering period reflected on the Independent Government Cost Estimate (IGCE). If we were to factor in the average yearly inflation rate of 3.99% per year to this salary, it would be an increase each year. The proposed cost UK provided totaled for a five year period, when compared to the lower salary and accounting for a 3.99% yearly increase; total cost would for a period of five years.

UK’s proposed cost is 17.5% lower than the cost associated with an FTE over a five year period.

The second aspect involves the need for 24 hour services. An FTE would only be available hours per year of in house efforts; however this would not account for the remaining hours needed per year. Utilizing the collaborative efforts outline in the MOU 24 hour coverage is feasible at a faction of the cost it would take to fulfil this requirement.

The final aspect is related to the compared cost associated with the previous contract which established its pricing as fair and reasonable. UK’s proposed pricing will remain consistent throughout the tenure of this requirement. This alleviates the 3.99% yearly increase that would be associated with the current market value for these services. If the Government pursued the approach of hiring FTE’s to fulfil their needs it would result in an increase cost as we have clearly delineated one FTE will not fulfil this need.

In conclusion, the above information provides evidence that justifies a sole source award to UK for their pricing is advantageous to the Government. UK’s proposed pricing for a five year period is significantly lower than the estimated market value. The Governments IGCE falls in line with UK’s proposal of which reflect zero cost difference due to their shared affiliation. Therefore, the proposed cost of this five year agreement with UK is hereby deemed fair and reasonable when compared to the current market.

8. Description of the Market Research Conducted and the Results, or a Statement of the Reasons Market Research Was Not Conducted:

Market Research was conducted and results are displayed under item 5 for determination of Unique Qualifications. This research concluded that there is an established Memorandum of Understanding between the VA and UK for the use of animals in research. During market research a review of FPDS resulted in the discovery of multiple contracts that were awarded by the Department of Veterans Affairs under NIAICS 541940 of which only Institutions of Higher Learning were provided these services.

9. Any Other Facts Supporting the Use of Other than Full and Open Competition:

38 USC § 8153 (a)(3)(A) states, “If the health-care resource required is a commercial service, the use of medical equipment or space, or research, and is to be acquired from an institution affiliated with the Department in accordance with section 7302 of this title, including medical practice groups and other entities associated with affiliated institutions, blood banks, organ banks, or research centers, the Secretary may make arrangements for acquisition of the resource without regard to any law or regulation (including any Executive order, circular, or other administrative policy) that would otherwise require the use of competitive procedures for acquiring the resource.”

10. Listing of Sources that Expressed, in Writing, an Interest in the Acquisition:

University of Kentucky (Unique Entity ID: H1HYA8Z1NTM5) Division of Laboratory Animal Resources 204 Health Science Research Building Lexington, KY 40536

11. A Statement of the Actions, if any, the Agency May Take to Remove or Overcome any Barriers to

Competition before Making subsequent acquisitions for the supplies or services required:

NCO-9 has taken an approach of reaching out to entities that are considered Small Business through the means of posting its intent to Contract Opportunities and by email . These actions exhausted the capabilities to overcome barriers to competition; however, these actions also resulted in the determination that these services cannot be performed by small business concerns. Therefore, we have concluded that these types of requirements are only suited for Institutions of Higher Learning.

12. Requirements Certification: I certify that the requirement outlined in this justification is a Bona Fide Need of the Department of Veterans Affairs and that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

Keith Trumbauer Administrative Officer, Research & Development Services Troy Bowling VA Medical Center 1101 Veterans Drive, Lexington, KY 40502-2235

13. Approvals in accordance with the VHAPM Part 806.3 OFOC SOP:

a. Contracting Officer or Designee’s Certification (required): I certify that the foregoing justification is accurate and complete to the best of my knowledge and belief.

Dewana M. Raynor Contracting Officer Health Care West, NCO-9 1639 Medical Center Parkway, Suite 400, Murfreesboro, TN 37129

b. One Level Above the Contracting Officer (Required over SAT but not exceeding $750K): I certify the justification meets requirements for other than full and open competition.

Roxie Ann Keese Branch Chief Healthcare West, NCO-9 1639 Medical Center Parkway, Suite 400, Murfreesboro, TN 37129