Redacted Class JA_COI Umbrella_AAR (1Y249).pdf

Source Selection Information See FAR 2.101 and 3.104

DEFENSE LOGISTICS AGENCY

HEADQUARTERS

8725 JOHN J. KINGMAN ROAD

FORT BELVOIR, VIRGINIA 22060-6221

CLASS JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITY

This Class Justification and Approval (J&A) requests authority for Other Than Full and Open Competition to support requirements generated for the Department of Defense (DOD). The contracting authority for this requirement is the Defense Logistics Agency (DLA) Aviation, Richmond, Virginia, Strategic Acquisition Programs Directorate.

II. NATURE AND/OR DESCRIPTION OF THE ACTION BEING PROCESSED

Due to the circumstances described herein, this activity requests authority to acquire supplies and services using Other Than Full and Open Competition as prescribed by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. This action is part of an overall effort to optimize DLA’s support to sustainment operations by aligning the DLA’s Spare Parts Support Program across the Military Services to aid in the long-term health of supplies and services. This sole source requirement will be purchased from the following company:

AAR (AAR) Supply Chain, Inc.

1100 N Wood Dale Road Wood Dale, Illinois 60191 CAGE Code: 1Y249 Large Business

To support Military readiness, this action will result in the award of a new, multiple-year, Long-Term Agreement (LTA), which will be the overarching agreement (“Umbrella”) covering any sole source acquisition strategy for all supplies and services in which AAR is the sole exclusive distributor and only known source of supply. The Umbrella contract will remain valid for twenty (20) years. The duration of the terms and conditions will enable the Strategic Contract Division of DLA Aviation to award a variety of long-term subsumable contracts pursuant to this justification using the terms and conditions of the Umbrella. Such contracts will consist of varied base and option periods as deemed appropriate by the circumstances of the acquisition up to a ten-year total performance period. However, in no case will any subsumable contract exceed the ten-year period authorized by 10 U.S.C. 2304a(f), unless appropriate approval is obtained. All ordering is done using the subsumable contracts. Individual delivery orders or task orders will be issued after receipt of a fully funded purchase request.

For an item of supply or service to be covered under the authority of this Class J&A, the Government must have:

1) A signed technical certification that the item of supply or service is sole source.

2) Written endorsement from the OEM on company letterhead that -

a) Clearly states AAR as the “sole exclusive distributor.”

finally, an estimate for a customer direct service fee on applicable OEM parts, based on potential acquisition strategy.

Under the authority of this Class J&A, AAR will provide comprehensive supply chain management support, to include both Customer Direct (CD) and DLA Direct (DD) acquisition strategies, providing aftermarket parts supply and services. Supply chain management support includes, but is not limited to, performance-based support, stock support, transactional support, and depot support. Associated supply chain management functions include, but are not limited to, wholesale supply and logistics support, inventory management, maintenance planning, configuration management, engineering support and sustainment, packaging, and storage. The supplies and services include DLA managed items, Depot Level Reparable items managed by the Military Services, and Foreign Military Sales. This acquisition is restricted to items sole source to any OEM for which AAR is the sole exclusive distributor and only known source of supply.

IV. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION

The use of Other than Full and Open Competition is authorized by 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements, as there is only one responsible source and no other supplies or services will satisfy agency requirements.

V. DEMONSTRATION THAT THE CONTRACTOR’S UNIQUE QUALIFICATIONS OR

NATURE OF THE ACQUISITION REQUIRES THE USE OF THE AUTHORITY CITED ABOVE

The Agency's requirements can only be satisfied by unique supplies available from OEMs that are the sole approved source for the supplies and for which AAR is the sole exclusive distributor. These OEMs are the designer and developer of various weapon systems and subsystems found on aircraft, naval ships, submarines, and some land vehicles. The OEMs own the proprietary rights to the drawings, designs, manufacturing data, software, and unique test equipment required to manufacture, test, integrate, and calibrate these assets. The OEMs possess the unique capabilities and specialized test equipment to ensure the integrity and reliability of the weapon systems while complying with approved Government specifications. These weapon systems and/or subsystems are highly specialized and essential to supporting the Warfighter in a diverse environment. To avoid negatively impacting mission requirements essential for national defense, continuous support through the acquisition of the supplies and services for which AAR is the sole exclusive distributor for the specified OEMs is essential.

This Class J&A covers sole source supplies and services classified under multiple Federal Supply Classes with AMC of 3, 4, or 5 indicating items must be acquired directly from the actual manufacturer or exclusive distributor (DFARS PGI 217.75). Only items with a permanent Acquisition Method Suffix Code (AMSC) will be placed on contract. Any AMSC of “A” or “H” will be reviewed by the appropriate engineering authority and assigned a permanent AMSC before placement on contract. A complete technical review, screening, and certification of each item and service shall be complete prior to inclusion on a subsumable contract.

The supplies and services covered by this Class J&A are sole source for a variety of reasons to include the Government does not own data rights to purchase from other sources of supply, technical data is proprietary, the Government cannot purchase, develop or otherwise obtain data, items require engineering source control approval by the design control activity, or items must be acquired from a manufacturing source specified on a source control drawing. These OEMs are unwilling to sell data rights to the

Government; therefore, technical data packages, specifications, and engineering descriptions are not suitable for Full and Open Competition. Inquiries and evaluations are performed periodically to determine if it is feasible to purchase data for procurement from other sources.

This acquisition is restricted by an OEM’s exclusive distributor agreement with AAR, which makes AAR the only source of supply known to have the capability of furnishing the required supplies and services.

AAR has access to proprietary rights to the technical data and is the only firm capable of providing the supplies and services described in this section without experiencing unacceptable delays in fulfilling Warfighter requirements.

Technical certifications to include a complete technical review and screening shall be completed prior to inclusion of any OEM part subject to AAR’s exclusive distributor agreement on a subsumable contract action under the Umbrella LTA. This certification shall confirm the acquisition is restricted to AAR as the only source of supply known to have the capability of furnishing the required supplies and services.

VI. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE SOLICITED

FROM AS MANY POTENTIAL SOURCES AS DEEMED PRACTICABLE

A Sources Sought notice or Request for Information will post in Contract Opportunities for all proposed contract actions covered under this Class J&A.

In accordance with FAR 5.201, proposed contract actions will be synopsized on the beta.SAM.gov website.

It is anticipated that sources having an interest in subcontracting may be identified through synopsis.

Although the Government does not own sufficient data to support the acquisition of supplies and services covered under this Class J&A from any other source, any source who responds to the Government as a result of a synopsis will be identified to AAR as a potential for subcontracting possibilities. Future requirements will also be advertised on beta.SAM.gov to ensure that potential alternate sources that have since entered the market are aware of the requirement and can state their interest in supporting applicable items.

VII. DETERMINATION BY THE CONTRACTING OFFICER THAT THE ANTICIPATED COST

TO THE GOVERNMENT WILL BE FAIR AND REASONABLE

The overall cost of this acquisition will be fair and reasonable to the Government. In accordance with FAR 15.403-4, when the contracting officer concludes that none of the exceptions in FAR 15.403-1 applies, the contractor will be required to provide certified cost and pricing data only to be used in supporting the Government’s evaluation of the proposed cost. The proposed skill mix of labor, labor hours, types and quantities of material, other direct costs, and direct and indirect rates may be negotiated by the Government based on recommendations from the Defense Contract Audit Agency and expert technical personnel supporting the program. Contract pricing will be negotiated in accordance with the procedures in FAR Part 15.

In accordance with FAR 15.403-3, when the contracting officer determines an exception in FAR 15.403-1 applies, certified cost and pricing data is not required. AAR will be required to provide data other than certified cost or pricing data to the extent necessary to determine a fair and reasonable price. At a minimum, AAR will be required to provide appropriate data other than certified cost and pricing data on the prices at which the same or similar supply or service has been sold, adequate for determining the reasonableness of the prices unless an exception under FAR 15.403(b)(1) or (2) applies. Thorough price analysis will be conducted using available information and approved cost and pricing techniques that will support the contracting office in making a determination that the price paid to the contractor is fair and reasonable to the Government. Methodologies to assure commercial pricing techniques include utilizing publicly offered catalogs, comparison to historical contractor sales, and/or analysis of limited cost and pricing information which could be made available by the contractor. In the event that limited cost and pricing information is made available, the Government’s negotiation objective may be developed using local technical analysis applied to direct and indirect rate factors recommended by the DCAA and/or DCMA. Contract pricing may be negotiated in accordance with procedures in FAR Part 12, 13, or 15.

Based on the above, the Contracting Officer hereby determines that the anticipated cost to the Government for all supplies and services covered under this Class J&A will be fair and reasonable.

VIII. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE RESULTS, OR

STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT CONDUCTED

Market research was conducted by reviewing the results of recent market research undertaken to meet the same or similar requirements to determine if alternate sources, equipment, or substitutes may be available to fill the Government’s needs with only minor modification. The results of market research indicate that due to unique capability requirements, other commercial or non-commercial supplies and/or services, or non-developmental items cannot be incorporated or modified to meet the Government’s needs. Therefore, this acquisition is restricted to the only source of supply known to have the capability of furnishing the required supplies and/or services. AAR is the only qualified source capable of providing the supplies and services as described in Section III without the Warfighter experiencing unacceptable delays in fulfilling requirements.

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

COMPETITION

Based on technical certification on file, the supplies and services covered under this Class J&A are coded as sole source, and technical data is not available and cannot be developed to permit full and open competition.

The data presently available reflects the minimum needs of the Government.

X. LIST OF SOURCES, IF ANY, THAT EXPRESSED INTEREST IN THE ACQUISITION

AAR Supply Chain, Inc. (CAGE: 1Y249).

No other sources have expressed interest in this acquisition.

XI. 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

Market research will be performed on any future procurement to determine if interested sources have entered the market, or if commercial items or non-developmental items are available to meet the Government’s needs. Future requirements solicited under the authority of this Class J&A shall be advertised to ensure potential alternate sources are aware of the requirement and can express interest in supporting these items. Any supply or service determined competitive, either because of an alternate manufacturing source or an alternate distribution source, will be removed as a requirement in accordance with DLAD 52.216-9006 and Procurement Note L27, Addition/Deletion of Items.

A complete review, screening, and technical certification of supplies and services will be completed prior to inclusion on a contract. In accordance with DFARS PGI 217.7506, DoD’s Spare Parts Breakout Program, all items will go through an initial screening process by the product specialist for technical review of the AMC and AMSC and there will be recurring review of these codes for screening and coding parts in order to provide the contracting officer summary information regarding technical data and sources of supply to meet the Government’s minimum requirements. This information assists the contracting officer in selecting the method of contracting, identifying sources of supply, and making other decisions in the pre-award and award phases, with consideration for established parameters of system and equipment integrity, readiness, and the opportunities to competitively acquire parts. Procurement Notes L22 Restriction of Alternate Offers for Source Controlled Items, L04 Offers for Part Numbered Items, and M06 Evaluation of Offers for Part Numbered Items will be included in solicitations to provide potential suppliers guidance for items, as appropriate. If screening results indicate an item has become competitive, the item shall be removed from consideration or contract in accordance with Procurement Note L27 Addition and Deletion of Items.

Only items with a permanent AMSC will be placed on contract. Therefore, items with a temporary AMSC of A or H will be excluded from consideration until reviewed for possible assignment of a different or permanent AMSC. These items shall be continually reviewed, not less than annually, in part to determine if technical data is available to allow for assignment of a more permanent AMSC. Any item determined to be competitively available before contract award will be removed from the acquisition. Any item determined to be competitively available after contract award may be deleted from the contract and competitively re-solicited. The results of the reviews and reclassification actions for AMSC A and H items will be reported by the Contracting Officer to the local Competition Advocate (COMPAD) and may be reported to DLA COMPAD in accordance with DLA Acquisition requirements. If the review of an item classified as AMSC H does not result in the assignment of a more permanent AMSC within the later of one year of approval of this justification or one year of the item’s placement on a contract covered by this justification, the Contracting Officer shall remove the item from the contract.

XII. CONTRACTING OFFICER’S CERTIFICATION

The contracting officer’s signature on the Coordination and Approval Document is evidence that she has determined this document to be both accurate and complete to the best of her knowledge and belief.