redacted_hydroid_nc_Redacted.pdf

DEPARTMENT OF THE NAVY

INDIAN HEAD DIVISION

NAVAL SURFACE WARFARE CENTER

3767 STRAUSS AVENUE

SUITE 201

INDIAN HEAD, MD 20640-5150

J&A Number:l3-0071 Code: A23

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

JUSTIFICATION

1. Contracting Activity

The Contracting Activity is the Naval Sea Systems Command, Naval Surface Warfare Center, Indian Head Division, Procurement Division, Code A2. This requirement is for the Naval Explosive Ordnance Disposal Technology Division (NAVEODTECHDIV), Indian Head, Maryland.

2. Description of the Action Being Approved

This is a request for authorization of a sole source contract for the production of additional MK 18 Unmanned Underwater Vehicles (UUV) Family of Systems (FOS), including initial outfit of repair parts kits. The total proposed value of this contract, if all options are exercised and all units are ordered, is $36.46M. The prime contractor for this effort is Hydroid, Inc, located at 6 Benjamin Nye Circle, Pocasset, MA 02559.

3. Description of Supplies/Services

MK 18 FOS UUV systems provides Navy expeditionary forces with very shallow water (VSW) and shallow water (SW) mine countermeasures (VSW MCM) and underwater object localization tools. The UUV systems protect the members of all services and the public who could be subject to danger from undetected/unidentified underwater threat objects in both foreign and domestic coastal and confined waters. The MK 18 FOS UUVs are based on Hydroid's commercially available REMUS UUV, with their associated auxiliary and support equipment.

The MK 18 FOS is a specific but evolving configuration of uuv system, which is subject to the PMS 408 (EOD) Underwater EOD Configuration Management Plan. This contract is necessary to

1) provide additional MK 18 FOS UUV systems for expanded capacity, 2) provide replacement for MK 18 FOS UUV systems

J&A Number 13-0071 which are lost or damaged beyond repair, and 3) provide initial repair and replacement components to support the MK 18

FOS.

The maximum units for purchase for the MK 18 Mod 1 will be system units, UUVs, OBRP kits. The MK18 Mod 2 will be system units, UUVs, OBRP Kits, I-level maintenance Kits.

If during negotiations or as a result of the purchase of large quantities of units, the unit price is lower than the Government estimate, the Government reserves the right to increase the quantity within the limits of the ceilings detailed below.

Estimated Dollar Value FY13 FY14 FY15 FY16 FY17 Subtotal

OPN, $7.52M $10.32M $10.63M $2.78M $5.21M $36.46M

OPA,

OPAF

O&MN 0 0 0 0 0 0

FMS 0 0 0 0 0 0

Total $7.52M $10.32M $10.63M $2.78M $5.21M $36.46M

The Government's minimum needs have been verified by the certifying technical and requirements personnel.

4. Statutory Authority Permitting Other Than Full and Open Competition

10 u.s.c. 2304(c) (1), as implemented by Federal Acquisition Regulations (FAR) 6.302-1, "Only one responsible source and no other supplies or services will satisfy agency requirements."

5. Rationale Justifying Use of Cited Statutory Authority

REMUS based MK 18 UUVs, associated auxiliary and support equipment, and spare parts have been procured under several previous competitive and non-competitive contracts to provide unmanned, un-tethered, expeditionary uuvs to the war fighter.

REMUS based MK 18 Mod 1 UUVs are the

Larger REMUS based MK 18 Mod 2 UUVs are not man portable, but offer many benefits in operational and support similarities, while extending range and allowing for larger, higher power drawing sensors. s r

PMS 408 was tasked to support the immediate development, testing, evaluation and life cycle support activities associated with these systems. Both the MK 18 Mod 1 and Mod 2 Systems are supported by existing auxiliary and support equipment, as well as provisioned spare and repair parts, a user community trained in their operation and maintenance, training courses and other logistics support.

The MK18 FOS provides vsw and sw MCM capabilities for Search Classify-Map and Reacquire-Identification for Navy Expeditionary Forces to meet a continuing critical requirement. This contract will be a follow-on effort to Contract No. N00174-03-D-0018, which was awarded competitively to Hydroid on May 03, 2003. It will provide equipment required to field a system capability, as well as provide the components needed to support routine repairs at organizational and intermediate levels. Without these supplies, the fielded systems cannot be maintained in a fully functional condition, and may be unavailable and unable to meet the mission requirements placed upon them.

A MK18 system consists of UUVs and associated auxiliary equipment. These uuvs can be used singularly, or in groups to search areas for threat objects. Due to the environment of their usage, UUVs are at risk of being damaged beyond repair or lost altogether. For operational and support compatibility reasons, a UUV manufactured by another company (assuming one existed that met the specifications) can't simply be inserted into the MK18 System. For this reason, the proposed contract will allow procurement of individual MK18 UUVs as well as MK18 systems.

Procurement of a system based on a different UUV/manufacturer would require excessive cost and delay to execute a competitive procurement based on the system performance specifications, procure prototypes, test and validate the design, develop a training, maintenance and support system, and field a new UUV system with all necessary auxiliary and support equipment.

The costs to test and validate performance and establish a logistics support chain for a second type of vehicle are estimated to be $12,746,000. This estimate was based upon historical information from the development of the current MK 18 FOS. If a second system were developed and fielded, there would be continuing higher costs for manpower, facilities, training, documentation, services and supplies to support two different systems for as long as vehicles from both were in use by the same commands. Furthermore, the substantial duplication of costs for a second system of this highly specialized equipment will not be recovered through competition.

Hydroid Inc. is the only U.S. licensed manufacturer of the REMUS uuvs on which the MK 18 Mod 1 and Mod 2 systems are based, and maintains the proprietary design and all data rights to the REMUS. Although the Navy may have expanded rights in the Mod 1 and Mod 2 variants, these rights and available data are not sufficient to conduct a competitive procurement for the MK 18 Mod 1 and Mod 2 FOS. Hydroid Inc. is thus the only company capable of providing replacement unitsfor the UUV systems that are currently in the fleet, as well as the only company that can provide additional systems that may be required by the US Navy/EOD community to meet their mission requirements.

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

Hydroid is the sole source of supply. An internet search did not yield a finding of any other contractor that can supply the required parts or provide the needed repairs. This requirement was synopsized in FedBizOpps on Feb 04, 2013. No other offerors have contested this action.

7. Determination of Fair and Reasonable Costs

The Contracting Officer will determine whether the cost to the Government for the supplies covered by the J&A is fair and reasonable by using cost and price analysis techniques described in FAR Part 15.4, prior to award.

8. Actions to Remove Barriers to Competition

Since Hydroid Inc. maintains all proprietary data rights and licenses to the REMUS UUV Systems on which the MK 18 FOS is based, all new MK 18 Systems, UUVS and maintenance parts must be purchased from Hydroid Inc.

PMS 408 (EOD) is continuously monitoring the state of the commercially mature/available UUV market. Until such time as the current system is replaced and removed from service, it remains necessary to support the existing fleet systems using the same equipment and OEM replacement parts and supplies.

TECHNICAL/REQUIREMEN'rS CERTIFICATION (FAR 6. 303-2 (b})

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

TECHNICAL/REQUIREMENTS COMBINED COGNIZANCE:

Signature Name (Print) and Title (Code) Phone No. Date

CONTRACTING OFFICER CERTIFICATION (FAR 6.303-2(a) (12)) is accurate and complete to the I certify

LEGAL SUFFICIENCY REVIEW (NMCARS 5206.303-90)

this justification is legally sufficient.

APPROVAL BLOCK (FAR 6.304 for Approving Official)

Upon the basis of the above justification, I hereby approve, as Designee of the Head of the Procuring Activity, the solicitation of the proposed procurement(s) using of other than full and open competition, pursuant to the authority of 10 u.s.c. 2304(c) (1).

D · ~~ of the Head of the Procuring Activity ~ gs ~ C'wo 1 R.Si;Avci<> .W >:> /z,;_3 ure=(Print r Date~ 1 vincent.culliver Sticky Note Accepted set by vincent.culliver