RKV_J A_GC_Coordinated_Redactions_Applied_13_Jul_16.pdf

Contract No. HQ0147-12-C-0004 J&A No: 15-0011, Amd 1

HQO 14 7- l 2-C-0004 (The Boeing Company)

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Introductory Paragraph.

Upon the basis of the following justification, I, as Director of the Missile Defense Agency (MDA), hereby approve the issuance of the contractual action discussed below using other than full and open competition pursuant to the authority cited herein.

2. Agencies and Contracting Activity, (Federal Acquisition Regulation (FAR) 6.303-2(b )(1)).

The MDA Program Executive for Programs and Integration (DP) in support of the Ground Based Interceptor (GBI) Redesigned Kill Vehicle (RKV) project plans to award a contract modification to an existing contract by means other than full and open competition.

The purpose of this amendment is to incorporate:

• Updated contracting points of contact; Reference paragraph 2

• The six primary tenants required to achieve operational effectiveness in order of priority; Reference paragraph 3

• Updated Ground-Based Midcourse Defense (GMD) Development and Sustainment

Contract (DSC) total contract value; Reference paragraph 3

• Revisions to design authority; Reference paragraph 4

• Additional 890,000 Direct Production Labor Hours (DPLH) (for a total of 1,340,000

RKV hours) required to support the course of action which includes extending the performance period under a task instruction (TI); Reference paragraph 4(f)

• Revisions to program budget; Reference paragraph 4(g)

• Additional information supporting the use of other than full and open competition;

Reference paragraph 9

The contracting activity is the MDA Contracting Directorate (MDA/DAC). The point of contact for this action is Ms. Cathy Hill, Director of Contracts, at 256 450-1432, and Ms. B.

Marie Wilson-Noack, Contracting Officer, at 256 450-2405.

3. Nature and Description of the Action Being Approved, (FAR 6.303:..2(b)(2)).

The GMD RKV is required to increase operational effectiveness through 1) reliability, 2) producibility, 3) maintainability, 4) affordability 5) testability, and 6) survivability when compared to the Exo-atmospheric Kill Vehicle (EKV). The EKV was deployed prior to completing a robust ground test program and a design tum for producibility. The RKV will replace the current EKV with a modular, producible kill vehicle that leverages mature technologies to meet RKV program requirements. These improvements are achieved through a modular design and a rigorous testing program. The RKV also improves performance against emerging threats . The RKV will have improved hardening for

, wider Field of View, and better containment. It will also include On-Demand Communications which improves use of off-board sensor data and provides increased situational awareness for the Warfighter. The RKV, coupled with the Long Range Discrimination Radar and Discrimination Improvements for Homeland Defense, forms the foundation of the homeland defense against emerging threats by 2020.

In order to acquire the RKV and satisfy Agency requirements without unacceptable delays, the Government contemplates the issuance of a contract modification to the existing GMD Development and Sustainment Contract (DSC) with The Boeing Company. The modification will extend the DSC period of performance to 2021, add the RKV development scope and deliver eight initial production RKV s for further integration into the All-Up Round (AUR) GBI (it is anticipated that additional boosters, while not included within the scope of this Justification and Approval (J&A), will be acquired under a separate contract action). The modification is necessary to maintain the program schedule for the RKV flight tests scheduled in 2018 (2019 Threshold), 2019 (2020 Threshold), and 2020 (2021 Threshold) and initial operational capability in 2020 (2021 Threshold).

The Missile Defense Agency awarded the DSC contract to The Boeing Company, Missile Defense Systems, Huntsville, AL (HQO 14 7-l 2-C-0004) in 2011. The total contract value is $4.15B with a period of performance of December 30, 2011 through December 30, 2018.

The DSC was competitively awarded. The scope of work under this contract includes, but is not limited to: future development, fielding, test, systems engineering, integration and configuration management, equipment manufacturing and refurbishment, training, and operations and sustainment support for the GMD Weapon System and associated support facilities . The contract modification at issue here will include the acquisition of RKV test units and a quantity of eight initial production RKV s. The DSC includes scope for a delivery of Kill Vehicle (KV) payloads integrated into GBis, including but not limited to the following:

• Robust Homeland Defense (RHD) capability requirements and supporting component design reviews.

• Compliance with Ballistic Missile Defense System Specification requirements.

• Resources for the design, development, assembly, test, and delivery of all hardware associated with the KV.

• Develop and release KV software and associated documents and procedures.

• Provides Integration, Assembly, Test, and checkout activities.

• Performs the integration of the KV and all testing, checkout, and acceptance efforts unique to the KV.

The contract type to be used for this modification will be either a cost-plus-award-fee or a cost plus- incentive-fee type, but other contract types may be used if determined necessary by the Contracting Officer. The anticipated period of performance of the proposed contract modification resulting from this approval will begin in 4QFY16 and is anticipated to end in

4QFY21.

This J&A shall not be cited as authority to make any other changes in the DSC scope of work, period of performance, or costs.

4. Description of the Supplies and/or Services Required to Meet the Agency's Needs (including the estimated value), (FAR 6.303-2(b)(3)).

The RKV Program scope includes payload development, payload ground testing, integration with the GBI and GMD Ground System, flight testing and eight initial production RKV s for initial fielding untilAUR Competitive Production cut-in. The eight initial production RKVs will prevent any gaps in production and fielded capability. A robust modeling and simulation, qualification, and ground testing program is in place to verify component, module, and system level performance prior to moving to the next phase of testing. The RKV development will be performed by Boeing along with its cross-industry team.

The Boeing-led cross-industry team design solution concept provides a consolidated product that leverages the team's capabilities and knowledge in kill vehicle· design and development. The integrated capabilities teaming method will incorporate the most viable technical approaches and combine resources that shorten the learning curve and reduce the time needed to develop and begin initial production.

The Government, assisted by Technical Direction Agent (TDA), and in collaboration with the cross-industry team (under Boeing leadership as the Prime contractor) determined the overall best design solution based on cost, schedule, performance, and risks. The Government, as the overall design authority, directs key design decisions, configuration control, engineering boards, and will approve Class 1 changes to the technical and engineering baselines. The Government controls the Interface Control Documents between major components and modules. The Government approves entry and exit criteria to all design reviews (to include System Requirements Review, Preliminary Design Review (PDR), and Critical Design Review (CDR)), ground tests, and flight tests, and will determine successful completion of milestone events. The TDA will provide technical assessments, design options, risk identification, and mitigation paths. This approach mitigates the need for the program office to rely exclusively on Industry for analysis, and developing alternatives. The cross-industry team provides modeling and simulation data to the Government for independent validation and verification of software and performance.

The contractor will provide all models and simulations and source code to the Government.

The major work content elements are discussed in more detail in the paragraphs that follow:

a. RKV Systems Engineering. The RHD capability includes requirements and supporting component design reviews. Reviews will be identified, conducted, and documented to assess the degree of completion of technical and programmatic efforts related to major schedule milestones. A standard process will be used and approved by the Government for conducting formal reviews with supporting entrance and exit criteria and objective evidence ..

b. RKV Compliance. The RKV will be compliant with the Ballistic Missile Defense System (BMDS) specification requirements. RKV requirements will be executed as derived from the BMDS system specification and associated GMD level requirements.

Requirements traces will be updated and maintained verifying compliance with requirements and internal and external interface specifications.

c. RKV Development. The development includes design, development, assembly, integration, test and delivery of qualified hardware, software and firmware associated with the KV. Systems engineering efforts supporting integration of the RKV payload with the GMD system will be performed. Engineering efforts will support integrated GMD ground and flight-testing. Design will focus on reliability, producibility, maintainability, modularity, testability, safety and mission assurance.

d. RKV Testing. The RKV testing effort will develop, conduct, and execute a robust development, qualification, and acceptance ground test and evaluation program, BMDS Ground Test program, and BMDS Flight Test program with a commitment to a methodical engineering and improvement program. Testing includes design verification tests, characterization/margin testing, reliability testing, service life testing, and engineering evaluation and integration tests.

e. RKV Delivery. RKV Delivery includes multiple integrated RKV payloads of qualified hardware, software and firmware supporting flight and ground testing and up to eight initial production RKV units for integration in to the AUR GBI.

f. RKV Task Instruction. The RKV program was initiated under a TI and will continue to operate under a TI until contract award. Two or more TI periods are required to initiate the RKV program. After each TI period, the Program will assess the contractor's progress prior to proceeding. The Tis require a total of 1,140,000 hours (DPLH). This amendment incorporates the additional hours required to support the following course of action:

• Establish second TI period allowing the contractor to continue to perform risk reduction activities, provide initial requirements definition toward Preliminary Design Review (PDR) I Critical Design Review (CDR) and incorporate scope for performing RKV payload development, testing, RKV Peculiar Support Equipment and Special Test Equipment development.

The RKV program may require additional Tis, up to 200,000 DPLH, throughout the program to conduct Special Studies and Special Emphasis Projects during the RKV development and initial production. RKV Special Studies and Special Emphasis Projects will include special emphasis tasks that include implementation of technical study results or recommendations; procurement of material; drawing updates/engineering releases; facility changes; other Stockpile Reliability Program Testing; technical support to Government M&S independent assessments.

The DSC, as initially awarded, included 700,000 DPLHs, which were available for use across the seven year contract period of performance, for an average of 100,000 per year. In June 2015 , an additional 600,000 hours were authorized under a J&A signed by the Director of Contracts, MDA. These additional hours were required based on the emerging ballistic missile threat environment, which increased the projected use of DPLHs under DSC Tis for GMD Homeland Defense requirements. At that time, the GMD Joint Program Office anticipated that evolving threats would result in an increased requirement for the use of DPLHs, which would remain elevated for the duration of the DSC. As predicted, the evolving threat environment has consistently increased the requirement for award ofDPLHs under DSC Tis. Additionally, an increase of 450,000 was authorized under the original RKV J&A signed by the Director, MDA in September 2015 to support RKV requirements. A separate J&A is being processed concurrently with this document to authorize an additional 2,000,000 hours required to execute other GMD requirements. The net effect will be a total of 1,340,000 DPLH for RKV and 3,300,000 DPLH for all other GMD requirements.

g. The eight initial production RKV units referred to within this J&A approval consist of a KV only, without an associated booster. The GMD Program Office will execute a separate modification for changes to the booster, development of the AUR GBI, improvements to GMD fire control software, and modifications to the In-Flight Interceptor Communication System data terminal to support On- Demand Communications. Cross-industry team participation during the RKV development phase will increase competition and reduce costs during the full and open competitive production phase.

The following reflects the RKV President' s Budget 2017 for the supplies and services to be procured under the authority of this acquisition.

TY$M FY15 FY16 FY17 FY18 FY19 FY20 Total

RKV Development/ Initial Production*

52.3 218.2 193.3 203.3 242.1

*Exclusive of non-prime and Government program office funding

58.8 968.0

This effort will be funded with Research, Development, Test and Evaluation appropriation funds or other funds as authorized and appropriated by Congress.

The planned delivery date for the first fielded RKV is after the FTG-18 intercept test (additional boosters, while not included within the scope of this J&A, will be acquired under a separate contract action). This requirement is based on an analysis of

5. Statutory Authority Permitting Other than Full and Open Competition, (FAR 6.303-2

(b) (4)).

The statutory authority permitting other than full and open competition is 10 U.S.C. 2304(c) (1) as implemented by FAR 6.302-l(a) (2) (ii), only one responsible source and no other supplies or services will satisfy agency requirements:

(ii) Supplies may be deemed to be available only from the original source in the case of a follow-on contract for the continued development or production of a major system or highly specialized equipment, including major components thereof when it is likely that 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; or (b) Unacceptable delays in fulfilling the Agency's requirements.

The one responsible source is the current prime contractor, The Boeing Company, which is part of a cross-industry team comprised of The Boeing Company, Lockheed Martin Space Systems Company, and the Raytheon Company.

6. Demonstration of Contractor's Unique Qualifications or the Nature of the Acquisition Requires use of the Authority Cited (FAR 6.303-2(b)(5)).

Unique Qualifications:

The Boeing Company is the design lead for the SM-3 IA kinetic warhead. It has developed, built, and flight-tested multiple EKVs and components (Boeing EKV & Kinetic Energy Anti Satellite KV, PAC-3 seeker). Boeing is the prime developer for the GBI.

Lockheed Martin Space Systems Company has a broad range of KV experience as prime developer for Terminal High Altitude Area Defense, as the original multiple KV (MKV) concept developer, and as one of three prime concept developers for SM-3 IIB. Component level experience includes algorithm development under Project Hercules and a range of sensor, modeling, discrimination, and further MKV concept development projects.

The Raytheon Company presently develops, manufactures, integrates, tests, and deploys interceptors, KVs, and kinetic warheads for the GMD and Aegis BMD programs. Raytheon has significant experience with KV systems architecture trades and analysis on SM-3, EKV, and MKV-Raytheon programs.

As stated above, with The Boeing Company as the GMD DSC prime contractor, the cross industry team members have collectively demonstrated special capabilities and/or expertise that are not prevalent in the marketplace. No other company is known to be able to satisfactorily perform the required services or deliveries without unacceptable delays in fulfilling the Agency's requirements. In addition, the need to acquire long lead materials to begin fabrication of a maximum quantity up to eight initial production units prior to the completion of qualification testing is required in order to meet Agency schedule objectives. A new supplier could not reasonably deliver the stated requirements within the timeframe necessary to meet the emerging threat. Moreover, embarking on a second source qualification effort would likely add approximately 24 months to the delivery schedule and would cause an unacceptable gap for deliveries to the Warfighter from 2020 to 2024 or beyond. This gap will cause an unacceptable delay in fulfilling the Agency' s requirements, which will impact the Agency's ability to support the Warfighter within the required time constraints. At this point in time, there is only one responsible source capable of delivering the GMD RKV in FY2020 without significantly increased programmatic risk and unacceptable delays-namely, The Boeing Company under the DSC with assistance from Lockheed Martin Space Systems Company and The Raytheon Company as major subcontractors.

7. Description of Market Research Conducted, (FAR 6.303-2(b)(6), (8) and (10)).

MDA issued an updated statement of work on September 10, 2014 to the three Common Kill Vehicle, Concept Definition and Program Planning (CDPP) contractors to require updates to their KV concepts presented to MDA at the Functional Concept Review (FCR) held in 2QFY14.

The CDPP contractors presented their updated concepts to MDA in January 2015. To satisfy the Agency's needs for market research, the information and data provided from the KV FCR presented in March 2014 and the Delta Concept Review (DCR), presented in January 2015, established the capabilities within the market that support RKV acquisition and design decisions.

The three contractors listed below presented sufficient information through the FCR and the DCR to substantiate that each is qualified to develop and integrate KV concepts.

Company

The Boeing Company

Lockheed Martin Corporation Raytheon Company

DUNS Number

126368257

872978978 794598573

Type of Business

Large

Large Large

In addition, MDA performed market research in September 2014 identifying vendor capabilities to support development and production of sub-assemblies and components for the RKV. The 38 request for information respondent's technology and contact information were provided to the RKV potential production sources for possible future subcontracting opportunities.

8. Determination of Fair and Reasonable Cost, (FAR 6.303-2(b)(7)).

In accordance with FAR Part 15 .402, the Contracting Officer will ensure that all supplies and services ordered under this contract are procured at a fair and reasonable price. The contractor will submit a formal proposal addressing all requirements of the solicitation. MDA will conduct a thorough evaluation of the offeror' s proposed cost/price for this effort. Certified cost or pricing data and sufficient information to support accuracy and reliability of the estimate will be required in the proposal. Boeing' s proposal will be reviewed by experienced technical analysts and contract specialists with the assistance of necessary field pricing support from Defense Contract Management Agency (DCMA) and Defense Contract Audit Agency (DCAA). The cost and price analysis will concentrate on completeness, realism, reasonableness, allowability and allocability. Rates and factors will be verified through the DCAA and DCMA activities, as well as any unusual or proposed deviations from Boeing's approved Disclosure Statement and standard accounting practices. To the extent applicable, actual data from the current DSC contract will be used as part of the analysis. The Contracting Officer will utilize the cost and price analysis as the basis for negotiating a fair and reasonable price.

9. Any Other Facts Supporting the Use of Other Than Full and Open Competition (FAR Part 6.303-2(b)(9)).

The RKV acquisition approach allows for a development plan that is aligned to meet the urgent need of fielding a replacement for the less than reliable EKV as expeditiously as possible.

10. Actions Taken to Remove Barriers to Competition (FAR 6.303-2(b)(ll)).

The RKV acquisition approach includes a competitive phase for RKV production upon completion of a successful flight test in 2020 (2021 Threshold). The MDA intends to obtain no less than government purpose rights to the maximum extent possible during the development phase for the RKV. The data rights will include the special tooling and test equipment needed for integration and manufacturing and ownership of the Interface Control Documents for RKV modules to enable competition for the RKV production effort. The DSC contract clause, H DSC-09 Insertion of Limited or Restricted Rights into the GMD Program, was modified to make any and all assertions of less than Government Purpose Rights made by the contractor or any of its subcontractors/suppliers, on the DSC contract or any other Government contract, as inapplicable to the RKV effort. Any and all RKV-related assertions of less than Government Purpose Rights in technical data, as well as computer software, will be submitted as a new assertion allowing the Government to challenge the assertion. The competitive production contracting strategy will leverage the insight and design knowledge accumulated by the cross industry team during the development phase to provide the best value to the Government during production. The in-depth knowledge attained by the contractors during the developmental phase of the RKV program should enable a Fixed Price contract award thus setting the conditions for a low risk production approach for the Government.

The program guidance issued by USD(AT&L) stated that the RKV development phase will include potential production sources from industry and will be followed by a full and open competitive production phase to implement a Government determined design including build-to print components where possible. The plan is to release the full rate production contract RFP at the beginning of 2018 (2019 Threshold) and award the contract upon a successful FTG-18 (DT/OT) flight test. This acquisition approach will support full rate production deliveries beginning in 2022 (2023 Threshold), and complies with the "fly before you buy" principle.

Cross-industry team participation during the RKV development phase will increase competition and reduce costs during the full and open competitive production phase.

Contract No. HQO 14 7- I 2-C-0004

11. Technical/Requirements Official Certification (FAR 6.303-2( c)) : "'I certify that this justification for other than full and open competition is made in good faith and that the supporting data and infomrntion are acc urate and complete to the best of my knowledge and belief. I further certify that thi s request is not the result of a lack ot' advance planning."

Ill. Product Manager. RK V. MDAJGMV

12. Technical/Requirements Official Certification (FAR 6.303-2(c)): ··1 certify that this justification for other than ful l and open competition is made in good fait h and that the upporting data and information are accurate and complete to the best of my knowledge and belief. I further certify that thi s request is not the result of a lack or advance planning.·· or Ground-Based Midcourse Defense. MDN GM

13. Contracting Officer (FAR 6.303(b){t2)): -- 1 have determined that the anticipated cost to the Government will be fair and reasonable and certify that the justifi cation is accurate and complete to the best of my kno\.vledge and ability ...

14. Legal Counsel ; --1 have reYiewed the justifirntion and dctem1ined it to be legall y sufficient .··

Mr. William A. Groves. General Counsel, MDA/GC

15. Contracting Director (Program Level): .. , have revie,ved the justificat ion and recommend it be approved:·

Contract o. llQ0 147-12-C-0004

16. Program Exccutin Certification: ··1 hn\'c rc\' ic wcd the justilica ti on and n:commcnJ it he appro\'ed .··

Brigadier General Will iam T. ' oley. Program Executive. Program s & Integrati on. MDA!DP

17. Recommendation of Competition Advocate: ··1 rewmmend appro\'a l of the ahow justi lica tion.· ·

18. Director fo r Cont rac ts . .. , ha\·c re \·ic\\"ed the justifica ti on and recommend it be apprm·cd ...

Ms. larsha Thornton. Di rector tit" "0ntrncts. t\ 1 [);\ / !) ,\ C

19. Director fo r Acquisition. " I lum: rc\·ic\\"ed the j ustifi cation and recomm1:nd it he appro\'cd .··

~v1 s . Laura 1\ 1. DcSi mone. Director for Acq uisition. l\1DA 'DA

20. Approva l (FA R Pa rt 6.30-t ): ··in a..:rnrdancc with FAR 6.30..\ . the..• ahcl\'c justilicati clll for othc;:r than full and open competiti on is hcn:h; appr<m:?d ...

V ADM J. D . Syring, Director, MDA/D

I 0