Redacted Justification_Redacted.pdf

VHAPM Part 806.3 Other Than Full and Open Competition (OFOC) SOP Request for Sole Source Justification Format >SAT

OFOC SOP Revision 09 Page 1 of 7 Original Date: 03/22/11 Revision 09 Date: 04/17/2020

DEPARTMENT OF VETERANS AFFAIRS

Justification and Approval (J&A) For

Other Than Full and Open Competition (>SAT)

Acquisition Plan Action ID: 36C256-20-AP-2937

Contracting Activity:

Department of Veterans Affairs, VISN 16, Michael E. DeBakey Veterans Affairs Medical Center (MEDVAMC). Requisition Number: 580-20-3-5161-0070

Nature and/or Description of the Action Being Processed:

The MEDVAMC and Network Contracting Office 16 proposes a sole source, firm fixed price

Order with Johnson Controls Inc. (JCI). The period of performance will be a base period of 12 months, with four 12-month option periods exercisable at the discretion This procurement is for YORK Smart connected chiller technology bundle and service in accordance with FAR 13.5 Simplified Procedures for Certain Commercial Items and specifically Federal Acquisition Regulation (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.

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

The estimated value of the proposed action is . MEDVAMC has a requirement for 24 hours per day, seven days per week of remote monitoring, real time diagnostics, preventive maintenance and repair of 16 water cooled YORK Centrifugal Chillers connected to YORK’s Metasys Building Automation System (BAS). JCI is the Original Equipment Manufacturer (OEM) for the various Government owned YORK chillers listed below.

Chiller Number Location Manufacturer Model Number Serial Number Chiller #1 B104 YORK YKPQPK1-CYG SGBM-006390 Chiller #2 B104 YORK YKPQPK1-CYG SNXM-143460 Chiller #3 B104 YORK YKPQPK1-CYG SNXM-142730 Chiller #4 B104 YORK YKPQPK1-CYG SNXM-142920 Chiller #5 B104 YORK YKPQPK1-CYG SNXM-143280 Chiller #6 B104 YORK YKPQPK1-CYG SNXM-14310 Chiller #7 B104 YORK YKPQPK1-CYG SMXM-142550 Chiller #8 B104A YORK HH HB J2 DC ES SALM-613720 Chiller #9 B104A YORK HH HB J2 DC ES SALM-613850 Chiller #1 B109 YORK YK CF Q7 CN F SHPM-928930 Chiller #2 B109 YORK YKEPERQ7-CNG SFTM-990250 Chiller #3 B109 YORK SKPM-975570 SKPM-975570 OR Chiller #1 Roof B100 YORK YCAS0140EC46XGASDTXXBXXL RKMM006559 OR Chiller #2 Roof B100 YORK YCAS0140EC46XGASDTXXBXXL RKMM006560

OFOC SOP Revision 09 Page 2 of 7 Original Date: 03/22/11 Revision 09 Date: 04/17/2020

B108 Chiller #1 B108 YORK YLAA0080SE46XA SGTM-022950 B108 Chiller #2 B108 YORK YLAA0150EE46XCA SGTM-022951

Each chiller is equipped with either variable frequency or solid-state starters and YORK computer control boards which communicates to the YORK Metasys BAS Network. These components will allow operation of the currently requested YORK Smart connected chiller technology bundle and services. This service combines patent pending technology and proprietary equipment with a specialty trained service team. JCI is the OEM of the YORK Smart connected chiller monitoring technology and has the only OEM trained personnel for providing maintenance services in conjunction with this proprietary system. This system enables JCI chiller mechanics to quickly diagnose problems in real-time and provide immediate response for corrective action.

YORK Smart connected chiller communication system is unique and encrypted to use on either existing networks or over a dedicated cellular virtual private network. It provides one-way outbound communication using HTTPS/TLS1.2 protocols over port 443 and all data is securely stored and accessed in the Microsoft Azure cloud. This cloud-based analytics platform provides secure communication during remote real-time diagnostics and analysis. The YORK Smart connected technology is highly specialized and is the only digital platform to connect to our existing YORK Water-Cooled Centrifugal Chillers. This technology allows for YORK Chiller data to be analyzed in real-time to diagnose and troubleshoot problems. Data is stored to observe long term trends and allow for investigation leading up to failures and to find the root cause.

4. Statutory Authority Permitting Other than Full and Open Competition:

The authority for applying the Simplified Procedures for Commercial Items of FAR 13.5 is 41 U.S.C.

1901 and is implemented by for restricting competition on this procurement via FAR 13.106-1(b)(2).

Only JCI is capable of providing the services required at the level of quality required because the YORK Smart connected chiller technology bundle and services are highly specialized, proprietary, and has a patent pending algorithm.

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

YORK Smart connected chiller technology bundle and services for remote monitoring of YORK Chillers can only be delivered by JCI. As previously mentioned, JCI is the OEM and the sole provider of YORK Smart connected chiller technology. JCI stated Smart connected chiller technology bundle and services is only offered, serviced and installed through the local JCI branch office and not through any distributor or reseller of JCI products. The Government technical expert identified several contractors, such as, Solar Winds MSP, Smart Connected Carrier and Daikin Remote Service with similar technology, but they cannot fully integrate into YORK’s Chiller communications protocol to enable all data points to be utilized. MEDVAMC currently has Government owned YORK Chillers.

All data points are required to effectively diagnose the chillers, provide YORK trained mechanics, and OEM material for optimal performance. Failure to enable all data points could increase this requirement by an estimated 40 to 80 percent. Without the ability to enable all data points the MEDVAMC will not be able to predict failures before they happen or replace equipment before it breaks. The MEDVAMC will have to primarily respond to failures in the system after they happen.

Other contractors would need to subcontract directly to JCI for the YORK Smart connected chiller technology bundle and service which would also increase the cost of this requirement if it is not

OFOC SOP Revision 09 Page 3 of 7

Revision 09 Date: 04/17/2020 procured directly from JCI. Failure to obtain the YORK Smart connected chiller technology and maintenance will result in increased costs for the current maintenance of the YORK chiller system and a duplication of costs to attempt to obtain a similar system from a competitor which will not perform at the same level due to the inability of competitor’s equipment to enable all data points.

The Chiller service provider must have access to the YORK Smart connected chiller technology via the current YORK Metasys BAS Network in order to view, troubleshoot and diagnose potential equipment failures. The YORK Smart connect chiller technology is the only digital platform with the ability to interface with our Government owned YORK Centrifugal Chillers and YORK Metasys BAS Network. YORK Smart connected chiller technology is the only service compatible with our existing system to enable remote real-time diagnostics services. JCI is the sole parts and service provider for the YORK Smart connected chiller system.

YORK Smart connected chiller technology utilizes a patent pending algorithm in their Chiller Performance Index (CPI) which restricts the use of this technology from other contractors. The CPI is used to detect unexpected chiller failures before they break down which leads to lower maintenance and energy costs. JCI’s patent pending algorithm allows their CPI to intelligently factor in multiple aspects of a chiller’s performance into a single value to quickly identify Chillers that need attention. Scores for each chiller range from 0 to 100 and are broken into three ranges: Acceptable (76-100), Alert (51-75) and Alarm (0-50). The higher the score, the better your chiller is performing.

Chiller mechanics have the ability to view each chiller’s operation condition in real time from any location using a laptop or smartphone to ensure immediate response and provide corrective actions. This allows for optimal chiller performance and provides consistent environmental climate controls to critical areas such as operating rooms, cath labs, emergency department, intensive care units and data centers. Failure of these chillers would severely impact the MEDVAMC’s operations and patient care services.

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

Notice of intent to sole source number 3625620Q0923 was posted to beta.sam.gov. Notice of intent to sole source number RFQ1442004 was posted to GSA eBuy. RFQ1442004 did not receive any responses. One small disadvantaged business, , responded to the notice of intent to sole source posted to beta.sam.gov and provided an authorization letter from JCI to service JCI’s Metasys platform. did not provide an authorization letter to install, service, and maintain YORK Smart connected chiller technology bundle and services. The Government technical expert determined the contractor was not technically capable to provide YORK Smart connected chiller system monitoring and maintenance. On July 16, 2020, the Contract Specialist (CS) emailed a request for an authorization letter from the OEM for Smart connected chiller technology. responded on July 17, 2020 stating they were authorized but did not provide an authorization letter. The CS emailed JCI on July 16, 2020 to confirm if YORK Smart connected chiller technology bundle and services were offered by any other contractors. On July 17, 2020, JCI confirmed this service is only offered through the local JCI branch office and not through any distributor or reseller. JCI also stated the JCI Metasys platform is not the same as the Smart connected chiller technology. JCI stated Metasys has a wide range of offerings but Smart connected chiller is geared towards chillers. On July 20, 2020, the CS emailed a second request to for an authorization letter and to confirm they provide YORK Smart connected chiller bundle and services. responded on July 22, OFOC SOP Revision 09 Page 5 of 7

Revision 09 Date: 04/17/2020

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

, a small disadvantaged business, expressed an interest in this requirement. As mentioned in section six, Lange Mechanical services did not provide an authorization letter to provide the requested services. The Government technical expert also determined Lange Mechanical Services is not technically capable of providing these services. JCI also expressed interest in this requirement via email and stated JCI is the only contractor providng the required services.

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:

Although the Government technical expert identified several contractors with similar technology during market research, these contractors cannot fully integrate into YORK Chiller communications protocol and enable all data points to be utilized. The Government will continue to survey the market on future requirements to determine if other contractors are able to offer compatible equipment to meet all data points with existing Government owned YORK equipment.

OFOC SOP Revision 09 Page 6 of 7

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.

Date

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.

NCO 16, DIV III, Services B

Contracting Officer

b. One Level Above the Contracting Officer (Required over SAT but not exceeding $700K): I certify the justification meets requirements for other than full and open competition.

OFOC SOP Revision 09 Page 7 of 7

HIGHER LEVEL APPROVAL (Required for orders over $700,000):

Director of Contracting

NCO 16

c. VHA RPO HCA Review and Approval: I have reviewed the foregoing justification and find it to be complete and accurate to the best of my knowledge and belief and recommend approval (if over $68 million) or approve ($700K to $68 million) for other than full and open competition.

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Regional Procurement Office Central (HCA)

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