Redacted JA TFU Benchmark_Redacted.pdf

Control Number: ARC-J&A-1926

JUSTIFICATION REVIEW DOCUMENT

FOR OTHER THAN FULL AND OPEN COMPETITION – FAR Part 6

Program/Equipment: Product Manager (PdM) Air Warrior (AW) subordinate organization Personnel Recovery Support Equipment (PRSE) has a requirement to purchase an annual quantity of 3,816 active Transceiver Field Unit (TFU) assemblies and associated Engineering support as required.

Authority: 10 United States Code (USC) 3204(a)(1), As implemented by Federal Acquisition Regulation (FAR) 6.302-1, (a)(2)(iii)(A) and (B) - Only One Responsible Source and no other supplies or services will satisfy agency requirements.

Amount:

Prepared by:

Name: DSN:

Title: Program Analyst Date: 5 Aug 2024 Email:

Contracting Officer:

Name: DSN:

Title: Contracting Officer Date:

Technical Representative:

Title: Project Officer, PM Air Warrior Date:

Ema :

Requirements Representative:

Title: Assistant Product Manager, PM Air Warrior Date:

Reviews

I have reviewed this justification and find it adequate to support other than full and open competition.

Product Manager:

Name: DSN: 7

Signature: Date:

CUI//SP-PROCURE//FED ONLY

JUSTIFICATION AND APPROVAL (J&A)

FOR OTHER THAN FULL AND OPEN COMPETITION – FAR Part 6

1. CONTRACTING AGENCY: Department of the Army, Army Contracting Command – Redstone, Arsenal (ACC-RSA), CCAM-ARC, Redstone Arsenal, AL 35898-5000.

2. DESCRIPTION OF ACTION: The Product Manager, Air Warrior (PdM AW) Personnel Recovery Support Equipment (PRSE) is formally requesting a modification for a three-year extension to the existing Indefinite Delivery/Indefinite Quantity (IDIQ) contract with Benchmark Electronics, Inc. (CAGE code: 1TD06). The current five-year contract (W58RGZ-20-D-0014), awarded on February 4, 2020, and set to expire on February 3, 2025, has a total value of

. The anticipated award for the follow-on contract will be issued on the February 3, 2025. However, due to unforeseen changes in the funding profile within the PRSE portfolio, the full contract ceiling could not be executed within the original timeframe. The proposed three-year extension is valued at . The total contract ceiling of 0 will not increase. The extension would provide for three additional 12-month ordering periods, ensuring continuity of critical support for Army personnel recovery efforts. The contract consists of Firm-Fixed-Price (FFP) and Cost-Plus Fixed Fee (CPFF) Contract Line-Item Numbers (CLINs), which would be utilized in each individual delivery order issued under the IDIQ contract. The extension is necessary to prevent a significant capability gap and disruption to the production and fielding of life-saving personnel recovery equipment. The use of existing funding profiles, including Other Procurement-Army (OPA) and Research, Development, Test, and Evaluation (RDT&E) funds, would facilitate the procurement of Transceiver Field Unit assemblies and Engineering Services. Approval of this extension is essential to safeguard the lives of Army personnel and ensure the continued support of critical personnel recovery operations. The proposed extension would allow for the timely delivery of essential equipment and services, maintaining the Army's personnel recovery capabilities and preventing a potential gap in support. Therefore, the PdM AW PRSE strongly requests approval for the three-year contract extension to maintain the continuity of critical support for Army personnel recovery efforts.

3. DESCRIPTION OF SUPPLIES/SERVICES: The Army Contracting Command - Redstone Arsenal (ACC-RSA), on behalf of the Product Manager, Air Warrior (PdM AW), is proposing a three-year contract extension with Benchmark Electronics, Inc. to procure Transceiver Field Unit (TFU) assemblies and associated engineering support. The extension, which would run from February 4, 2025, to February 3, 2028, is necessary to maintain support for Army personnel recovery operations, which would be negatively impacted without it. The TFU is a highly complex electronic device designed by Sandia National Laboratories (SNL) for PdM AW, and its production and delivery are critical to the success of personnel recovery operations.

The proposed extension would utilize the existing contract ceiling of The additional three ordering periods (identified in Table 2, below, as Ordering Periods Six, Seven and Eight) are valued at The contract extension would also provide a mechanism for the contractor to develop and test necessary TFU modifications as directed by the Government through the Cost-Plus-Fixed-Fee (CPFF) Engineering Services option. The proposed delivery schedule is 180 days after receipt of order, although this is subject to negotiation. The extension is essential to ensure continuity of critical support and prevent disruption to personnel recovery operations. By maximizing the contract ceiling and utilizing existing resources this extension would also optimize resources for both the Product Office and ACC- RSA. If the extension is not approved, it would have a negative impact on Army personnel recovery operations and mission completion. Therefore, ACC-RSA is seeking to extend the contract duration by three years to ensure the continued success of these critical operations.

Table 1: Actual Contract Values for Ordering Periods One through Five out of the Total Ceiling Value of

Ordering Periods Quantity Unit Price Total Ordering Period One 6,000

Ordering Period Two 2,586

Ordering Period Three 2,057

Ordering Period Four 1,080 Ordering Period Five 265 Totals 11,988 N/A

Table 2: Estimated Contract Values for Ordering Periods Six through Eight

Ordering Period Six Description Quantity Unit Price Total Cost TFU Assembly 4,100 Ordering Period Seven Description Quantity Unit Price Total Cost TFU Assembly 3,700 Ordering Period Eight Description Quantity Unit Price Total Cost TFU Assembly 3,650

All Ordering Periods Engineering Service NA NA Remaining Contract Ceiling

4. AUTHORITY CITED: The statutory authority permitting other than full and open is 10 U.S.C. § 3204(a)(1), as implemented by Federal Acquisition Regulation (FAR) 6.302- 1(a)(2)(iii)(A) and (B), Only One Responsible Source and No Other Supplies Or Services Will Satisfy Agency Requirements due to substantial duplication of cost to the Government that is not expected to be recovered through competition.

5. REASON FOR AUTHORITY CITED: This requirement represents the continued production of a highly specialized item, the TFU assembly, which is a collaborative effort between Benchmark Electronics Inc. (CAGE Code 1TD06), located at 3535 Technology Drive, NW, Rochester, MN 55901-7687, and the Department of Energy's (DOE) Sandia National Laboratories (SNL). Originally designed by SNL, the TFU assembly's product specification is maintained by the laboratory, ensuring that the final product meets their stringent requirements. Benchmark Electronics Inc. has established itself as the sole contractor for the TFU assembly's production, leveraging its proprietary ownership of the production process.

The company's intimate knowledge of the product's production flow, supply chain, and component parts enables it to efficiently and economically produce the assembly while maintaining high standards of quality and security. The partnership between Benchmark and SNL is built on a foundation of trust and cooperation. As the controlling partner, SNL maintains oversight and control over the program's classified information and direction, providing critical inputs and classified information to ensure that the TFU assembly meets their requirements. In return, Benchmark utilizes its proprietary expertise to produce the assembly, relying on its extensive knowledge of the production process, lead times, and potential workarounds for problematic component parts. This exclusive partnership has enabled Benchmark to establish a reputation for being efficient, economical, and reliable in the production of the TFU assembly.

By combining its proprietary knowledge with SNL's critical inputs and oversight, Benchmark can sustain production while maintaining the high standards of quality and security required by the program. The result is a highly specialized item that meets the exacting requirements of the Department of Energy and Sandia National Laboratories.

(a) Previous J&A paragraph 7 summary: The prior Justification and Approval (J&A) for W58RGZ-20-D-0014 was based on the statutory authority permitting other than full and open competition at 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1(a)(1), “Only one responsible source and no other supplies or services will satisfy agency requirements,” and was approved by Special Advocate for Competition, ACC-RSA. Paragraph 7, “Actions to Increase Competition” of the previous justification, stated that design changes to the TFU were anticipated to be required which might result in the incorporation of new materials and modification of the manufacturing processes. However, none of those potential design changes were expected to increase competition.

(b) The Justification and Approval for contract W58RGZ-20-D-0014 to be awarded sole source was approved by the Army Contracting Command-Aberdeen Proving Ground Principal Assistant Responsible for Contracting, at that time. While the design has become well established and documented, the current manufacturing processes would continue to pose great difficulty for an alternate manufacturer to replicate to manufacture and delivery of a qualified populated circuit board fabrication and assembly procedures and the process employed which uses EN-7 as an under-fill epoxy protectant for the electronics, and a molded encapsulations overfill of the electronics and battery power source. An alternate manufacturer would have to set up an assembly line, purchase long lead items, train their employees, and go through testing and verification. A substantial duplication of costs and considerable delay is expected to qualify an alternate manufacturer that could not be recovered through competition.

Another dedicated Contractor, willing and able to partner with SNL would most likely require twelve to eighteen months to develop and perfect the TFU manufacturing process. The costs are estimated between the cost for SNL’s engineering assistance being a major cost contributor.

If this J&A is not approved, the Army will be impacted with a delay in future production articles and the requalification of the current production facility resulting in the lack of TFUs to support personnel recovery of isolated personnel.

6. EFFORTS TO OBTAIN COMPETITION:

a. Effective Competition: Because this is a sole source action, effective competition is not anticipated. The Government recently initiated an effort to extend contract # W58RGZ-20-D- 0014 by three years through a bilateral modification. To ensure transparency and fairness, a Request for Information (RFI) was formally posted on the System for Award Management (SAM.gov) on April 24, 2024, and closed on May 9, 2024. The RFI specified the Government's intent to award the modification and provided an opportunity for interested parties to respond.

However, due to the highly specialized and classified nature of the program, only one response was received - from the incumbent contractor, Benchmark. Benchmark's proprietary technology and expertise make them the sole company capable of performing the required work, and their unique qualifications and indispensable expertise have led Sandia National Laboratories to designate them as the exclusive provider. As a result, seeking alternative sources was not feasible, and the Government determined that it was not possible to conduct a competitive procurement. The RFI synopsis outlined the rationale for the extension and provided contact information for Benchmark to facilitate subcontracting opportunities. In accordance with Federal Acquisition Regulation (FAR) 5.201, the action was synopsized on SAM.gov in July 2024, ensuring that all stakeholders were informed of the decision. In summary, the Government's effort to extend contract # W58RGZ-20-D-0014 by three years was conducted in a transparent and fair manner, with the RFI process demonstrating that Benchmark is the only viable contractor due to their exclusive capabilities and expertise.

b. Subcontracting competition. The contract already includes applicable FAR provisions ensuring competition in subcontracting, including FAR 52.244-5, Competition in Subcontracting, FAR 52.219-8, Utilization of Small Business Concerns, and DFARS 252.219- 7004, Small Business Subcontracting Plan Test Program. The prime contractor is required to compete to the maximum extent possible all components which cannot be fully justified as noncompetitive.

7. ACTIONS TO INCREASE COMPETITION: In accordance with Defense Federal Acquisition Regulation Supplement DFARS 205.205-71, DFARS 206.302-1(d), and DFARS Procedures, Guidance, and Information (PGI) 206.302-1(d), the TFU RFI was posted to SAM.gov. No actions are currently planned to compete the requirement. As delineated in paragraph five, the primary reasons competition at the prime contracting level are not advantageous are the substantial duplication of costs and significant fielding delay. The Government will continue to monitor the market and available providers through daily research as it come available to see if an alternative solution becomes more advantageous.

8. MARKET RESEARCH: The Product Manager Air Warrior (PM AW) is seeking to identify interested contractors capable of manufacture and delivery of a qualified populated circuit board fabrication and assembly procedures is the process employed which uses EN-7 as an under-fill epoxy protectant for the electronics, and a molded encapsulations overfill of the electronics and battery power source. Market research was conducted in accordance with FAR Part 10.002. The Market Research Report/Commerciality Determination was signed 14 Aug 2024. Market research has been conducted during the past 12 months. The market techniques used consisted of discussing with knowledgeable persons in Government and Industry; personal knowledge; internet searches to review catalogs and/or generally available product literature. In addition, in accordance with DFARS 205.205-71, DFARS 206.302-1(d), and DFARS PGI 206.302-1(d), a RFI was posted to SAM.gov on 24 Apr 2024 for 15 days and the results was only one response from Benchmark. The TFU is not a commercial product.

FAR Part 12 will not be used in this acquisition.

9. INTERESTED SOURCES: In accordance with the FAR 5.201, the anticipated publication of the request in the System for Award Management (SAM.gov) was scheduled for April 2024. As expected, the publication occurred on time in April 2024. Prior to and following the publication, it was evident that no other vendors, aside from the initial vendor, possessed the capabilities to satisfy the Army's specific requirements for this item without requiring a significant investment of time and funding from the Government. Despite the opportunity for any interested source to come forward, no other vendors expressed interest in writing. Although the Government was prepared to give due consideration to any source that expressed interest, in accordance with the law, the sole response received was from the initial vendor. Throughout the process, it remained clear that the initial vendor was the only one capable of meeting the Army's requirements, and ultimately, no other sources came forward to provide the required item.

The requirements covered by the J&A will be synopsized and published SAM.gov upon approval of the J&A. Any sources expressing interest in participating in some aspect of the procurement action will receive due consideration in accordance with FAR 5.201.

Based on the information paragraph 7, Benchmark is the only one who can supply the required TFUs without unacceptable delay.

10. OTHER FACTS: Other factors supporting this contract extension and the use of other than full and open competition are as follows:

a. Procurement History:

(1) Contract: W91CRB-08-D-0003.

Contractor: Benchmark Electronics Inc.

Only One Responsible Source and No Other Supplies or Services will Satisfy Agency Requirements.

Quantity: 46,597 Unit Price: Varied, based on economic order quantity discounts.

Total Price, including Engineering Services tasks:

Contract Award Date: 8 December 2007.

- Acquisition data availability – Not applicable.

- Unusual and compelling urgency - Not applicable.

- Subcontracting competition - FAR 52.244-5, Competition in Subcontracting, will be included in the proposed contract.

(2) Contract: W91CRB-13-D-0002 Contractor: Benchmark Electronics Inc.

Only One Responsible Source and No Other Supplies or Services will Satisfy Agency Requirements.

Quantity: 32,600 Unit Price: Varied, based on economic order quantity discounts.

Total Price, including Engineering Services tasks:

Contract Award Date: 28 February 2013

- Acquisition data availability – Not applicable,

- Unusual and compelling urgency - Not applicable.

- Subcontracting competition - FAR 52.244-5, Competition in Subcontracting, will be

(3) Contract: W58RGZ-20-D-0014

Contractor: Benchmark Electronics Inc.

Only One Responsible Source and No Other Supplies or Services will Satisfy Agency Requirements Quantity: 26,250 Unit Price: Varied, based on economic order quantity discounts Total Price, including Engineering Services tasks:

Contract Award Date: 4 February 2020

- Acquisition data availability – Not applicable,

- Unusual and compelling urgency - Not applicable.

- Subcontracting competition - FAR 52.244-5, Competition in Subcontracting, will be

Patterns in Contracting: There are no unusual patterns revealed by the history of procurement.

(a) Previous J&A circumstances: Benchmark was the only contractor capable of providing the TFUs without an unacceptable delay to the Government’s mission. Award to a different contractor would have resulted in an 18 month program interruption.

Additionally, the cost for alternate vendor would have been the same or similar cost as for Benchmark. Also, Engineering services was required to support any unknown design changes necessitated by obsolescence or if the TFU was used in different operating environments. Any other contractor, other than Benchmark would not have been able to offer the Government design changes to a product for which they are unfamiliar, nor contribute significant manufacturing improvements as they would be unfamiliar with the processes and exacting acceptance criteria required.

(b) Other Facts. PdM AW and ACC-RSA are limited on resources with several contracts in work. This extension provides the USG the ability to prioritize AW contract awards while keeping good faith that all avenues were exhausted to find other sources.

11. TECHNICAL CERTIFICATION: I certify that the supporting data under cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

Signature: _ _____ Date: ________________

Systems Engineer, PRSE PM Air Warrior

12. REQUIREMENTS CERTIFICATION: I certify that the supporting data under cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

Signature: __ _ Date:________________

APM, PRSE

PM Air Warrior

13. FAIR AND REASONABLE COST DETERMINATION: I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable. The basis for this determination will be cost analysis, price analysis, independent Government cost estimate, audit, and technical evaluation. IAW FAR 15.403-4, certified cost or pricing data is required and will be obtained. The Defense Contract Audit Agency shall perform an on-site audit and provide a Final Audit Report, to be utilized by Technical and Pricing experts to develop and negotiate fair and reasonable pricing. In addition, the previous contracts may be used in determining fair and reasonable cost or price.

APPROVAL

Based on the foregoing justification, I hereby approve the bilateral modification to the sole-source, IDIQ contract W58RGZ-20-D-0014, as awarded to Benchmark Electronic, Inc., CAGE code 1TD06, for procurement of (up to 11,450) TFUs and Engineering Services via (3) option periods for additional performance years from 04 February 2025 through 03 February 2028. In total, approximately may be used to procure TFUs and Engineering Services.

PdM AW does not have the funds to purchase all the TFU requirements in a single year. This approval is granted on an other than full and open competition basis, pursuant to the authority of 10 U S C 3204(a)(1), invoking “Only One Responsible Source and no other supplies or services will satisfy agency requirements” s implemented by Federal Acquisition Regulation FAR 6.302-1, (a)(2)(iii)(A) and (B) subject to availability of funds, and provided that the services and property herein described have otherwise been authorized for acquisition.

Signature: ____________________________ Date: _ _________ ____

Name: Virginia A. Rosacia Title: Command Advocate for Competition

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