SF 1013 Sole Source Justification SUSI 8 Pre-Front Lay_Redacted.pdf

DEPARTMENT OF THE TREASURY

SF 1013 - JUSTIFICATION & APPROVAL FOR FAR SUBPART 13.5 SOLE SOURCE

(INCLUDING BRAND NAME) ACQUISITIONS

Treasury Standard Form – 1013 (Rev 5/18)

Prescribed by Treasury: DTAP 1013.501 Tracking No.

1. Identification of the requiring activity and the contracting activity:

The requiring activity is the Bureau of Engraving and Printing (BEP), Office of Currency

Manufacturing and the contracting activity is Bureau of Engraving and Printing, Office of the

Chief Procurement Officer (OCPO), Western Currency Facility (WCF) Contracting Division.

2.a Nature and/or description of the action being approved:

The purpose of this sole source justification is to obtain approval to award a purchase order to

Koenig & Bauer for parts and installation on the SUSI press. A firm, fixed price purchase order will be issued for this requirement and the need date for these parts is 10 August 2022. A copy of the statement of work is attached.

2.b Name of the vendor. Koenig and Bauer Banknote Solutions SA (KBA)

2.c Requisition No.: TBD

2.d Bridge contract: ☐ Yes ☐ No 2.e Brand name: ☐ Yes ☐ No

3.a A description of the supplies or services required to meet the agency’s needs:

SUSI Press 8 /Press 64401815 is a high speed multi-functional printing press located at the WCF production floor. Recently, the press has experienced difficulties stabilizing the sheet while printing resulting in registration issues. The poor press performance has caused an increased spoilage rate resulting in a higher cost to produce United States Currency when run at top speed and when run at a slower speed small variations still occurs but a volume/throughput issue occurs resulting in a higher cost.

SUSI 8 requires replacement parts in order to stabilize sheets and return to fully functional status.

The Original Equipment Manufacturer (OEM) of the BEP’s SUSI presses is Koenig and Bauer;

they currently have sole proprietorship of these presses and are responsible for the design, manufacture, installation as well as maintenance and operation training of the system to the BEP

Electro Machinist (Maintenance) and Pressman (Operators).

3.b Includes IT: ☐ Yes ☐ No

3.c IGCE/Estimated dollar value:

The IGCE is and this amount is inclusive of delivery of parts and installation. Refer to the IGCE for additional details.

4. Identification of the authority being used (Check the box that applies):

☐ 41 U.S.C. 1901 – Simplified acquisition procedures.

☐ 41 U.S.C. 1903 – Special emergency procurement authority.

5. A demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited:

The proposed contractor’s unique qualifications and the nature of the acquisition requires use of the authority cited as follows:

i. The proposed contractor developed and owns the propriety and patented hardware, software and algorithms that are used in these products and support the services specifically required for this acquisition; thereby the proposed source has the sole unique technical and other resources required for this acquisition;

ii. The Government currently uses the proposed contractor’s brand name product at its manufacturing facilities at both the ECF and WCF. This brand name product supports the

Government need for continuity of operations in support of printing $5, $10, $20, $50, and

$100 US currency notes.

x x x x http://www.gpo.gov/fdsys/granule/USCODE-2011-title41/USCODE-2011-title41-subtitleI-divsnB-chap19-sec1901 http://www.gpo.gov/fdsys/granule/USCODE-2011-title41/USCODE-2011-title41-subtitleI-divsnB-chap19-sec1903

Treasury Standard Form – 1013 (Rev 10/17)

Prescribed by Treasury: DTAP 1013.501

Tracking No.

iii. As a result, IAW FAR 6.302-1, KBA is the only responsible source that exists and no other supplies or services will satisfy agency requirements.

6. A description of efforts to ensure that offers were solicited from as many potential sources as is practicable, including whether a notice was or will be publicized as required by FAR subpart 5.2 and, if not, which exception under FAR 5.202 applies:

A notice of intent to sole source was issued on the Government Point of Entry, System for

Award Management, at https://www.sam.gov / on 8 July 2022 and closed on 15 July 2022. The notice included a synopsis of the requirement. The notice did not yield any responses from industry.

7. A determination by the contracting officer that the anticipated cost to the Government will be fair and reasonable:

The Contracting Officer will determine the price to be fair and reasonable in accordance with

FAR 13.106-3. Proposed prices will be compared with historical prices paid which were found reasonable on previous purchases for similar requirement, specifically, BEP Purchase Order

2031ZA21P00445 for Parts for/Repair of SUSI 8 Press Machine. In addition, data other than certified cost or pricing data may be used to ensure a fair and reasonable price as applicable.

8. A description of the market research conducted (see FAR part 10) and the results or a statement of the reason market research was not conducted:

Market research was conducted by the Contracting Officer and Program Office between June

2022 and July 2022. The results of the market research supported the Government’s determination to obtain the parts and installation under a sole source basis. Refer to the SF 1010

Market Research Summary Report for additional details.

The Office of Acquisition, Contract Specialist conducted Market Research using the World Wide

Web, had collaborative meetings with BEP subject matter experts and reviewed historical in-house procurements to ensure proper market research from June 2022 to July 2022. The following techniques were used:

1. Reviewed the results of recent market research to meet similar or identical requirements:

• 2031ZA21P00445- Parts/Repairs SUSI 8 Press Machine. Award was issued as a sole source to KBA for a total award value of $86,849.00.

2. On 18 July 2022, SBA Dynamic Small Business was searched under the following applicable

North American Industry Classification System Code (NAICS): 333999, All Other

Miscellaneous General Purpose Machinery Manufacturing, with keywords press parts; the search resulted in zero profiles that met the search criteria.

3. In accordance with FAR 5.203(a) and based on the attached reports and findings, a notice of intent to sole source was issued on 8 July 2022 via the Government Point of Entry, System for

Award Management; which closed on 15 July 2022. The purpose of this notice was to conduct market research and to publish the Government's intent to sole source and obtain information from qualified businesses. No capabilities statements were received from this notice.

4. Contacted knowledgeable individuals in Government. They explained all Simultan presses are proprietary to OEM. The OEM has the technical expertise and know-how, in addition to ownership of the parts and source codes, to perform the required services. KBA is the OEM of the Simultan presses who has the intellectual property rights to the designs, hardware, and

Prescribed by Treasury: DTAP 1013.501 Tracking No.

software of the system. Therefore, the Government will not seek competition from other potential sources, other than the OEM. The results of the market research, attached, yield that only the OEM has the capability to provide and install the required parts. As such, and in accordance with FAR 13.106-1(b), the Contracting officer will send a Request for Quote to the

OEM.

5. It is the BEP's intent to solicit and negotiate with only one source under the authority of FAR

6.302-1 - Only one responsible source. Based on the findings above, the proposed source represents the only responsible and qualified source that has the requisite capabilities, specialized technical expertise, and knowledge to provide the required parts and installation.

9.a Any other facts supporting this justification:

None

9.b Attachments: ☐ Yes ☐ No

10. A listing of sources, if any, that expressed, in writing, an interest in the acquisition:

Koenig & Bauer Banknote Solutions SA is the only known source available and qualified to fulfilling the Government's requirement.

11. A statement of the actions, if any, the Requiring Activity or Contracting Activity may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required:

Market Research demonstrates that the market conditions have not changed for requirements of this nature. The OEM maintains proprietary information in close hold and does not utilize authorized service providers or resellers that carry or install the required parts. Although the BEP continues to make efforts to foster competition, it is unable to find sources possessing the technical capabilities and expertise required for the needed parts and install. Due to the unique nature of BEP's business, the equipment and machinery available to the BEP, and the services to support continued operations of these presses, it is unlikely that BEP will be able to foster competition for the parts and installation needed under this proposed contract action or any future action dealing due to the proprietary rights of the equipment by the OEM.

12. Certifications and Approvals:

12.a Program Office certification (Requiring Activity). I hereby certify that any supporting information and data provided, which form the basis for this justification, are accurate and complete to the best of my knowledge and belief.

Name: Date:

Signature:

12.b Contracting Officer certification and approval. I hereby determine the circumstances of this acquisition support the justification to acquire the item(s) on a sole source (including brand name) basis under the authority of FAR subpart 13.5. I also certify this justification is accurate and complete to the best of my knowledge and belief. Therefore, unless additional approvals are required as prescribed below, as the authorized contracting officer for this acquisition, I hereby approve this justification.

Name: Date:

Signature:

13. Additional Reviews and Approvals (As applicable):

13.a Bureau Chief Information Officer or Authorized Designee (for IT requirements that x

Tracking No.

are over $5 million, but not exceeding $68 million) (Contracting Activity). I have reviewed this justification and find it to be accurate and complete to the best of my knowledge and belief, and representative of the Government’s need. Therefore, I hereby consent to the approval of this justification. (Note: The Bureau CIO may delegate their authority for proposed contracts over $5 million, but not exceeding $13.5 million to the Associate Bureau CIO(s).)

Name: Date:

Signature:

13.b Advocate for Competition (if over $700,000, but not exceeding $13.5 million)

(Contracting Activity). I have reviewed this justification and find it to be accurate and complete to the best of my knowledge and belief. Therefore, unless additional approvals are required as prescribed below, as the Advocate for competition, I hereby approve this justification.

13.c Head of the Procuring Activity or Authorized Designee (if over $13.5 million, but not exceeding $68 million) (Contracting Activity). I have reviewed this justification and find it to be accurate and complete to the best of my knowledge and belief. Therefore, unless additional approvals are required as prescribed below, as the head of the procuring activity or authorized designee, I hereby approve this justification.

13.d Treasury Chief Information Officer (for IT requirements that are over $68 million). I have reviewed this justification and find it to be accurate and complete to the best of my knowledge and belief, and representative of the Government’s need. Therefore, I hereby consent to the approval of this justification.

13.e Senior Procurement Executive (if over $68 million) (Contracting Activity). I have reviewed this justification and find it to be accurate and complete to the best of my knowledge and belief. Therefore, as the senior procurement official, I hereby approve this justification.

Treasury Standard Form – 1013 (Rev 5/18)

DEPARTMENT OF THE TREASURY

INSTRUCTIONS FOR SF-1013 - JUSTIFICATION & APPROVAL FOR FAR SUBPART

13.5 SOLE SOURCE (INCLUDING BRAND NAME) ACQUISITIONS

I. General instructions. Each Justification & Approval for FAR subpart 13.5 Sole Source

(including brand name) acquisitions shall contain sufficient information and data to justify the proposed action, thereby be able to stand on its own. This type of detail is critical in order to enable a reviewer and/or approver to clearly understand the requirement and the rationale for supporting the justification. Simply copying and pasting information from a vendor’s website or marketing literature fails to support the use of such justification. Market research performed by the Requiring Activity and Contracting Activity should be used to support this document.

Given the majority of the information and data necessary to support this type of action resides with the Requiring Activity, they are the primary party responsible for completing this form.

However, the Requiring Activity shall seek assistance and input from the Contracting

Activity/Contracting Officer (preferably in advance of submission of the procurement request).

It is also recommended the justification is not signed by the Requiring Activity until such time the Contracting Officer has had an opportunity to review, make necessary revisions and to include other necessary information or data to support the justification.

For Brand-name acquisitions keep in mind the justification is to cover only the portion of the acquisition which is brand-name and that that the document approval requirements only apply to that portion. However, it does not mean that details regarding the overarching requirement (i.e.

in the instance where the brand name is only a portion of an overall requirement) aren’t to be included in the document.

In the event of conflict between this form and applicable regulatory coverage (i.e. FAR and

DTAR), the more stringent requirement shall be followed.

If the requirement involves classified or sensitive information ensure the proper steps are taken to protect the information (e.g. labeling and marking).

Prior to distribution for signature: (i) retain only those signature blocks applicable to the dollar value of the items covered by this justification, (ii) delete all green text (which are example), and

(iii) consider converting the document to .pdf to support electronic signature and ease of retention.

The fields within this form are fluid and will change based upon input, therefore individuals completing this form need to be mindful of formatting prior to converting the document to pdf and submitting it for signature.

II. Field specific instructions.

1. Identification of the requiring activity and the contracting activity. Provide the name of the requiring activity (e.g. BFS’ –IT Office). Provide the name of the contracting agency and the name of the actual contracting activity (e.g. BFS’s – Contracting Office for IT).

2. Nature and/or description of the action being approved. Describe the type of action being issued (e.g., new award, contract modification, or brand name). Identify the contemplated contract type (e.g. firm fixed price).

If an existing contract is being modified, thereby requiring a justification or a modification to the initial justification then ensure to include the contract no., task/delivery order number (if applicable), proposed contract modification number, nature of why the modification is required) and, if applicable, a copy of the initial justification. If known, period of performance. When processing a class justification, include the effective period the justification will be in effect.

If brand name, state this justification & approval is covering only the portion of the acquisition which is brand-name.

Section 2.b Name of vendor. If applicable, insert the name of proposed vendor. If not applicable, enter “Not applicable”.

Section 2.c Requisition Number. If known, include the requisition number. If not applicable, enter “Not applicable”.

Section 2.d Bridge contract. Check the applicable box. See DTAP 1017.70 for a definition of bridge contract and other requirements.

Section 2.e Brand name. Check the applicable box.

3.a A description of the supplies or services required to meet the agency’s needs. Provide a clear, concise description of the supplies or services to be procured. Include a statement regarding the delivery schedule and/or the period of performance, inclusive of all option periods and award terms. State the schedule and associated schedule category(ies) the supplies or services are being procured against. For supplies, include details such quantity and a brief description of the items (e.g. twelve (12) laptops).

For brand name, provide the name of the brand, model number and other specific details associated with the brand name item(s) to be procured; name(s) of known sources that can provide the brand name.

For modification describe the purpose of modification, including details such as proposed extension to the period of performance as well as the purpose of and type of the contract.

3.b Includes IT. Check the applicable box. If, yes is selected then include the NAICS and PSC.

3.c IGCE/Estimated dollar value. Provide the IGCE/estimated dollar value of the anticipated award, inclusive of all options, award terms and any other monetary incentives.

For brand name provide the IGCE/estimated dollar value of the portion of the proposed acquisition, inclusive of all options, award terms and other monetary incentives, that is for the brand name item and the full IGCE/estimated dollar value of the acquisition.

For modifications provide the IGCE/estimated dollar value of the modification and the current total dollar value of the contract.

4. Identification of the exception to fair opportunity being used. Check the applicable exception being used as the authority for the justification.

5. A demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited. Provide a clear and concise description of the rationale for the use of the authority being cited above, including a demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the exception cited. The following provides additional insight for purposes of completing this field:

• If using the proposed contractor’s unique qualifications then describe what makes the proposed contractor the only source. For example, (i) does the proposed contractor have facilities or equipment that are specialized or unique that are vital to the effort?; (ii) Is the proposed contractor the only one that can meet critical schedule(s) required by the Government?;

(iii) Does the proposed contractor have prior experience or expertise of a highly specialized nature that is vital to the effort?; (iv) Does the contractor have an exclusive licensing agreement?. Fully explain why no other supply or service provided by another vendor will satisfy the Government’s need. Also, describe any type of market survey and analysis efforts conducted to support this conclusion. Do not simply take information from a vendor’s website or other such marketing information to use as the basis as to why they are unique

• If using urgency describe the nature or circumstances surrounding the urgency of the agency’s need; how any follow-on work will be competed or how such urgency will be mitigated in the future; describe the extent and impact of any unacceptable delay (e.g. quantitative data, dollars that would be lost, the impact to schedule) if award is not made in the timeframe needed;

provide supporting rationale and a concise description of the extent, nature, and impact of the potential harm to the Government.

• If using brand name state the brand name product’s unique attributes (be specific and use technical terms, if necessary), provide an explanation of the proposed brand name item(s) unique qualifications and why no other similar product will suffice, including why other companies’ similar products lacking the particular feature, do not meet, or cannot be modified to meet, the agency’s needs; why (if applicable) the nature of the acquisition requires the use of the brand name product. Provide an estimate of the cost and/or delay the Government would incur if other than the brand name item is used for this requirement. Do not simply take information from a vendor’s website or other such marketing information to use as the basis as to why they are unique. Also, describe any type of market survey and analysis efforts conducted to support this conclusion.

• If the logical follow-on exception is used, the rationale shall describe why the relationship between the initial award and the follow-on is logical (e.g., in terms of scope, period of performance, or value).

• If authorized or required by statute is the supporting rationale behind the nature of this acquisition, cite the statute along with the specific language from the statute and how it applies to this acquisition.

6. A description of efforts to ensure that offers were solicited from as many potential sources as is practicable, including whether a notice was or will be publicized as required by FAR subpart 5.2 and, if not, which exception under FAR 5.202 applies. Provide a clear and concise description of the efforts taken to solicit from as many potential sources as is practicable (include the names of the vendors that responded to the notice or that were contacted or expressed interest).

Keep in mind, if a notice was or will be published, include the date that it was published or anticipated to be published along with any other pertinent information regarding the notice.

And if a notice was not published as required by FAR subpart 5.2, state the FAR exception that was used and how it applies to this acquisition.

7. A determination by the contracting officer that the anticipated cost to the Government will be fair and reasonable. Provide a clear and complete description of the contracting officer’s determination that the anticipated cost or pricing the Government will be fair and reasonable. This might include things, such as consideration of commercial pricelists or prior acquisition history.

8. A description of the market research conducted (see FAR part 10) and the results or a statement of the reason market research was not conducted.

See DTAP part 1008, 1010 and 1019 for Treasury Mandatory Sources and small business requirements.

Issuance of a synopsis as required in FAR part 5 does not satisfy the requirement of conducting market research. Market research requires collecting and analyzing product/service information on the technical capabilities and prices/costs within the marketplace to satisfy agency needs.

Altogether, describe the market research performed along with the results. Note: If a market research summary report (e.g. SF 1010) was completed, provide a summary of the findings/determination along with a citation to that document so that a reviewer can refer to that document for greater detail.

If market research was not conducted, provide a complete discussion of the rationale and, if applicable, the circumstances supporting why market research was not conducted.

9.a Any other facts supporting this justification. In addition, to the examples provided in the form itself and listed in FAR 6.303-2 other examples are:

• If acquisition of a patented or copyrighted product is based on the representation of the intellectual property holder that has not been licensed for resale.

9.b Attachments. Check the applicable box. Examples of attachments might be a copy of the IGCE, certification from the vendor stating they are other only authorized reseller of the particular item or are the patent holder of the item.

10. A listing of sources, if any, that expressed a written interest in the acquisition.

Provide a listing of sources, if any that expressed a written interest in the acquisition

(inclusive of the circumstances) or if no sources expressed interest provide a statement describing the reason. Do not use “Not Applicable”.

11. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required. Describe actions taken, or that may be taken, to remove or overcome any barriers to competition before any subsequent acquisitions for the supplies or services required (e.g. overcoming challenges to restrictive data markings, data rights, preparation of a performance based work statement). If planning or in the midst of a solicitation (i.e.

competitive or sole source), include information regarding this action (e.g. estimated date when the solicitation will be issued or anticipated date of award). If a sole source requirement is being contemplated, state the reasons why it will be sole source.

12. and 13. Certifications, Reviews and Approvals. Each review must be preceded by lower level approval(s), e.g., over $68 million all approvals are required. IN NO CASE SHALL AN

INDIVIDUAL SIGN MORE THAN ONE APPROVAL LEVEL.

For justifications that include the purchase of Information Technology (IT) the following apply:

• The IT signature reflects only the portion of the acquisition that is IT. This can be important when dealing with an acquisition where IT does not represent the predominate value of the acquisition (i.e. therefore it is not assigned a separate IT PSC code (see the

Treasury IT Acquisition Tracker).

• The Bureau Chief Information Officer (CIO) may delegate their authority for proposed contracts over $5 million, but not exceeding $13.5 million to Associate Bureau CIO(s).

Refer to the Bureau supplement to the DTAP to determine if the Bureau CIO has indeed delegated their authority.

A supplemental justification is required if any of the following revisions occur between approval of the original justification and actual award of the contract or modification of the contract: an increase in dollar value beyond the authority approved in the justification; a change in the competitive strategy that further reduces competition; or any type of change in the requirement that affects the basis of the justification.

Additional. Tracking No.: This field is completed as prescribed by Bureau procedures.

https://thegreen.treas.gov/do/ope/ITAcqTracker/Pages/Treasury-IT-Acquisition-Tracker---Home.aspx