REDACTED Justification and Approval for Other than Full and Open Competition FINAL.pdf

LRE-JA-16-0003-01

Justification and Approval for Other than Full and Open Competition

1. Contracting Agency: U.S. Army Corps of Engineers (USACE), Detroit District (CELRE), Contracting Division, Detroit, MI

2. Description of the Action: This document establishes the justification and requests approval to execute an in-scope modification to ARCADIS U.S, Inc. (ARCADIS) under Contract number W911XK16C0019, Howards Bay Remedial Dredging Design Project. This justification is prepared to request approval to modify an existing firm-fixed architect-engineer (AE) service contract to add additional requirements to the scope-of-work and to change the completion date. This contracted AE work is part of a larger project in which the USACE provides services for Environmental Protection Agency (EPA) to assess and plan remediation of river and harbor sediments in the St. River Area of Concern at Superior, This action is undertaken as part of an Interagency Agreement (DW-96-94819801-0; DW-96-9481901- E) for the design drawings and specification effort and Interagency Agreement (DW-096- 95939701-2) for the Construction and Engineering During Construction (EDC) effort.

3. Description of Services: USACE Detroit District is the requiring activity for this in-scope modification. The applicable North American Industry Classification System (NAICS) code is 541330, Engineering Services.

The awarded AE contract requires design services to prepare design analysis, drawings, specifications, cost estimate and proposed construction schedule for the construction project located in Superior, Wisconsin.

The proposed engineering during construction (EDC) work under the sole source modification will consist of the following specific tasks:

1. Coordination and Administration

2. Quality Control Plan

3. Accident Prevention Plan and Site Safety and Health Plan

4. Quality Assurance Plan for Sampling, Analysis, and Monitoring

5. Attendance and Participation in Initial Partnering and Preconstruction

Meetings

6. Attendance and Participation in Weekly Project Construction Progress

Meetings

7. Participation in Quarterly Project Partner Meetings

8. Attendance and Participation in Preparation and Initial Inspection Meetings

9. Surveillance of Environmental Activities

10. Review and Respond to Contractor Submittals in RMS

11. Review and Respond to Requests for Information (RFIs) in RMS

12. Technical Assistance for Contract Modification Documents

13. Perform Quality Assurance Sampling, Analysis, and Monitoring

14. Analyze, Interpret, and Document Analytical and Monitoring Results

15. Recommendations and Documentation for Project Activities

16. Dredge Prism and Design Revisions

17. GLLA Sediment Cleanup Documentation Report and Updated Design

Documentation Reports (DDRs)

18. Miscellaneous Teleconference Meeting

19. Final Walkthrough and Punch list

The proposed modification is follow-on work continuing design support during construction, it is estimated at $475,000 and would increase the current contract period of performance from the current completion date of 31 October 2020 to approximately 15 April 2023 (approximately 4 months beyond the anticipated construction contract (W911XK20C0017) completion date of 18 December 2022).

4. Authority Cited: 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii)(A), Only One Responsible Source and no other supplies or services will satisfy agency requirements. Services may be deemed to be available only from the original source in the case of follow-on contracts for the continued provision of highly specialized services when it is likely that award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition.

5. Reason for Authority Cited:

a. Background:

USACE is providing design and construction contracting documents on behalf of EPA as part of an ongoing project managed by EPA in partnership with the Wisconsin Department of Natural Resources (WDNR) and the Fraser Shipyard (together with EPA, called the Project Partners). Under a standing cooperative agreement with EPA and WDNR, Fraser Shipyard contracted engineering firm ARCADIS U.S., Inc. to collect extensive field data and to develop a Focused Feasibility Study (FFS) to evaluate available means and methods by which historic environmental contamination of harbor sediments can be effectively addressed in Howards Bay.

To date, ARCADIS has provided approximately $1M in highly specialized services to the Project Partners with specific aspects of their work as follows:

(1) ARCADIS has been providing professional services to the Project Partners on the Howards Bay project since February 2013;

(2) ARCADIS personnel have conducted extensive field operations in the unique environment of Howards Bay,

(3) ARCADIS has collected chemical analysis data on sediment samples collected from Howards Bay.

(4) ARCADIS has developed spreadsheets and mapped surface concentrations of chemical parameters in the project work area;

(5) ARCADIS incorporated some, but not all of its field data into the charts, diagrams, and exhibits that were used in the FFS;

(6) ARCADIS has worked with USACE to provide project data in support of project planning and cost estimating activities;

(7) ARCADIS presented technical findings at an international conference to describe remediation issues and alternatives at Howards Bay;

(8) ARCADIS has provided full design analysis, design drawings, design specifications, ECIFP, construction cost estimate, and proposed construction schedule.

(9) Any engineer other than ARCADIS would need to work closely with and procure data from ARCADIS before continuing the design of remedial construction activities at the Howards Bay site

USACE Detroit District (LRE) awarded the Howards Bay Remedial Design AE contract to ARCADIS in the amount of $359,998 on 30 August 2016 with period of performance of (approximately180 calendar days from contract award) 17 March 2017. The funding needed for the Howards Bay Remedial Dredging construction contract and EDC AE contract was obtained after the design contract (W911XK16C0019) was awarded. The following are a summary of the modifications executed on the AE contract:

(1) Modification P0001: Contract price increased by $9,198.48 from $359,998.00 to $369,196.48 to add Post Award AE Meeting in Chicago. Contract schedule remains unchanged at 17 March 2017.

(2) Modification P0002: Contract price increased by $90,611.00 from $369,196.48 to $459,807.48. This modification added Coordination of Permit Applications for construction of the project to include water quality, wastewater discharge, a Landfill Plan modification, NOI for Land Distribution Activity and Sediment and Erosion Permits. In addition, technical coordination for organizing and facilitating the pre-application permit consultation meeting with the WDNR and USACE Regulatory Staff was added. Contract schedule revised to 20 October 2017.

(3) Modification P0003: Contract price increased by $64,929 from $459,807.48 to $524,736.48. Added Conduct a Treatability Study with a Treatability Report, with Lab Testing and additional review of the DDR. Contract schedule remains unchanged at 20 October 2017.

(4) Modification P0004: No cost time extension. Contract schedule revised to 31 December 2017.

(5) Modification P0005: Partial stop work on design with no cost time extension.

Contract schedule revised to 31 March 2018.

(6) Modification P0006: No cost time extension. Contract schedule revised to 30 June 2018.

(7) Modification P0007: No cost time extension. Contract schedule revised to 31 July 2018.

(8) Modification P0008: No cost time extension. Contract schedule revised to 24 August 2018.

(9) Modification P0009: Contract price increased by $67,753.00 from $524,736.48 to $592,489.48 for changes to final Design Elements related to placement of Clean up dredge materials. Changes were necessary based on the Howards Bay Dewatering Treatability Study Report accomplished by ARCADIS, discussions with the stakeholders, tribal concerns and need for more time to resolve the issues. Contract schedule revised to 31 December 2018.

(10) Modification P0010: No cost time extension. Contract schedule revised to 04 March 2019.

(11) Modification P0011: No cost time extension. Contract schedule revised to 01 July 2019.

(12) Modification P0012: No cost time extension. Contract schedule revised to 31 October 2019.

(13) Modification P0013: No cost time extension. Contract schedule revised to 31 January 2020.

(14) Modification P00014: Contract price increased by $20,865 from $592,489.48 to $613,354.48 to add Bidder Inquiry response support for the Construction Contract. Contract schedule revised to 31 October 2020.

b. Justification:

The awarded Contractor has had to overcome several challenges that are not typical for a design for dredging construction project. This project scope is considered highly specialized based on the following:

ARCADIS has collected extensive field data to develop a Focused Feasibility Study (FFS) to evaluate available means and methods by which historic environmental contamination of harbor sediments can be effectively addressed in Howards Bay. To date, ARCADIS has provided approximately $1M ($360,000 EPA contract and $613,000 USACE contract for design plans and specifications) in highly specialized services to the Project Partners dating back to 2013. Based on the foregoing considerations, it is recognized that ARCADIS has developed a unique familiarity, understanding, and capability of operating within the Howards Bay project area. It is also recognized that ARCADIS possesses data that are not readily available to other environmental engineers.

Additionally, ARCADIS developed the design plans and specifications (DOR) therefore ARCADIS has legal responsibility for the design. If anyone makes design decisions on the design, they would take on responsibility and liability for the design.

This could amount to significant cost impacts.

In accordance with FAR 6.302-1(a)(2)(iii), services may be deemed to be available only from the original source in the case of follow-on contracts for the continued provision of highly specialized services when it is likely that the 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.

A substantial duplication of costs could be avoided by using ARCADIS to perform the EDC. Having a separate AE firm provide the EDC that was not the designer of record (DOR) for the design effort would require the potential for sunk costs related to contract administration, procurement, potential construction contract delays and costs, delays to start of construction contract, etc.

i. The cost savings are mostly seen on the following items:

(a.) Construction Administration Branch (CAB) labor support for the EDC contract.

CAB labor during construction is $3,000/month for the additional 6 months of a new contract. This assumes a contract award approximately 4 months after a modification would be executed and with added 6 months for new AE to familiarize themselves with the design analysis, drawings, specifications and EDC requirements. CAB labor support for added effort to revise the EDC SOW for new contractual action.

(b.) Higher cost for the EDC contract efforts to not only ramp up but also inefficiencies with EDC effort versus if completed by ARCADIS.

(c.) Contracting labor support costs for modification versus new contract action for the AE EDC contract.

(d.) Field office S&A increase for longer duration and more costly EDC contract for this project is 5.5%.

(e.) Project Manager Labor support costs for modification versus new contract action for a new AE contract.

labor for their efforts for the duration of a new contract would be another 6 months.

(f.) CAB supporting documenting the J&A for sole source modification with

ARCADIS.

(g.) The Construction Contract (W911XK20C0017) was awarded on 07 August 2020 and the NTP was issued and acknowledged on 25 August 2020 by the Contractor. Delays to the Construction contract (until EDC contract is awarded and ready to support the construction effort) it should be anticipated that the Construction Contractor would submit a REA for such delays.

(h.) Liability for the design will be taken on by the Government if USACE or another AE is tasked with making design decisions during construction. This will relieve ARCADIS of any liability as DOR if they are not contracted to provide EDC. Costs associated with this would be in the millions of dollars.

Cost summary table:

If by ARCADIS If by Others Additional Cost

EDC

Schedule

Assumes duration 15 months to 1 Feb 2022

Assumes duration 21 months

EDC

Contract Value (based on inefficiencies and ramp up)

$475,000 $754,750 $279,750

EDC Ramp Up Value (based on 6 months ramp up duration) (included in EDC contract value above)

N/A $89,750 $89,750

Field S&A (5.5% of EDC value)

N/A $10,450 $10,450

CT contract action (Mod vs New Contract)

$5,000 $20,000 $15,000

Additional PM effort N/A $20,000 $20,000 Additional CAB construction support

CAB effort on EDC rev SOW Prep & added time to administer (6 months)

N/A $23,000 $23,000

CAB effort on in-scope modification Amended J&A

$5,000 N/A -$5,000

Total $343,200

Note: These costs are not expected to be recovered through competition based on the fact ARCADIS is the designer of record (DOR).

c. Alternatives: The alternatives that were available to the Government were a new contract solicitation or an in-scope modification to the AE contract. The reason why a new contract solicitation was unacceptable is based on duplication of costs.

d. Impacts: The impacts for a new contract would add substantial duplication of costs. If the work is accomplished with a new contract the Government would incur additional costs estimated at $343,200.

Therefore, it is very important ARCADIS continue to provide services for this acquisition; it is recognized that ARCADIS possesses data that is required to deliver environmental engineering services recommended from USACE.

6. Efforts to Obtain Competition: It is estimated that ARCADIS's work was previously valued at $360,000 (prior to design contract award) would need to be repeated in addition to the design effort, combined valued at over $1M. Cost incurred by a new AE would more than offset any potential benefit of competition. This is a conservative value, and it is understood that no other engineer could undertake the work of this contract without procuring and/or repeating significant work already performed by ARCADIS. To date, no responses have been received from the NOI.

All responses received, will be reviewed prior to award of the modification.

a. Notice of Intent to Sole Source. A Notice of Intent (NOI) to Sole Source was posted to beta.SAM.gov by the District on 31 August 2020 which stated the intent to modify Contract number W911XK16C0019, Howards Bay. The primary purpose of this notice is to publicize this contract action prior to contract modification, as mandated in FAR Subpart 5.2, Synopses of Proposed Contract Actions and FAR Subpart 6.3, Other Than Full and Open Competition, and also to meet the requirements of DFARS PGI 206.302-1(d).

b. Effective Competition. Based upon the information in paragraph 5, there will be no competition for this action. The action is for a sole-source, in-scope contract modification to the design contract. The original contract procured by USACE was also sole sourced.

c. Subcontracting Competition. ARCADIS is self-performing the work.

7. Actions to Increase Competition: This J&A supports a discrete requirement that will end when the construction project is complete. Therefore, there are no planned actions to increase competition for the requirement covered by this J&A. Increasing competition will relieve ARCADIS of any legal liability as the DOR and would place all design liability on the Government.

8. Market Research: No responses were received as a result of the published NOI, dated 31 August 2020. As a result, the substantial duplication of cost to the Government deems ARCADIS is the only viable option to fulfill this work.

9. Interested Sources: There was no other environmental engineering firm that participated in the collection of data and development of project requirements to the degree that ARCADIS has under the preceding contract. Therefore, no other contractor who is more competent and better qualified to address the specific concerns and considerations at Howards Bay, and no other engineer could be selected under a qualifications-based selection process. To date, no other sources have written to express an interest. ARCADIS is deemed the only known source required cost and timeframe.

10. Other Factors: In accordance with the Brooks Act of 1972 (Public Law 92-582) the Government selected engineering firm based upon their demonstrated competence and qualification for the type of professional services required. (Subsequent negotiation ensures that such services are procured at fair and reasonable prices.)

1. Technical Certification

2. Requirements Certification

3. Fair and Reasonable Price Determination

4. Contracting Officer Certification

I certify 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.

Name: Steve Rumple Date: (date in electronic signature)

Title: Project Manager Signature:

I certify 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.

Name: Phillip C. Ross Date: (date in electronic signature)

Title: Chief, Engineering and Construction Signature:

II hereby determine that the anticipated cost or price to the Government for this contract action will be fair and reasonable.

Through the development and utilization of the Independent Government Estimate, the Pre-Objective Memorandum (POM) and the Post-Negotiation Memorandum (PNM), the Government will determine the proposed price is fair and reasonable prior to award of the subject requirement. As part of this evaluation, certified cost or pricing data will be required.

Name: Gail E. Hill Date: (date in electronic signature)

Title: Contracting Officer Signature:

I certify that this justification is accurate and complete to the best of my knowledge and belief:

Name: Gail E. Hill Date: (date in electronic signature)

Title: Contracting Officer Signature:

Approval Signature Block Based on the foregoing amended justification, I hereby approve the procurement of architect engineering work associated with EDC efforts supporting the Howards Bay Remedial Dredging project on an other than full and open competition basis pursuant to the authority of 10 U.S.C.2304(c) (1) as implemented by FAR 6.302-1, subject to availability of funds in the amount of $475 000, and provided that the Architect Engineer services and property herein described have otherwise been

Date: (date in electronic signature) Signature:

KIMBERLY A. MARSHALL

Alternate Advocate for Competition U.S. Army Corps of Engineers