J A6.302-2 iso 10-R-0327 10-D-1530 10-D-1531 10-D-153 redacted 6-23-2010.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

FOR PROCUREMENT OF INTERNATIONAL STANDARD ORGANIZATION

(ISO) CONTAINERS INCLUDING CHASSIS UNDER AUTHORITY OF

10 U.S.C.2304(c)(2)

AS DEFINED BY FAR 6.302-2 UNUSUAL AND COMPELLING URGENCY

1. Summary/Introduction: This justification is executed by the Defense Logistics

Agency (DLA), Defense Energy Support Center (DESC), Aerospace Energy BU (DESC-

MK), as the contracting activity. The action being approved is for procurement of an estimated 60 ISO Containers with chassis to be used to transport gaseous helium. DESC-

MK has a requirement to support a 300% increase of helium aerostat deployment in

Afghanistan with helium and the associated equipment for delivery to the aerostats. The initial forty ISOs will have the capacity to transport 50,000 to 100,000 Standard Cubic

Feet of Gaseous Helium Type I, Grade A. The procurement is being executed under the statutory authority of 10 U.S.C. 2304(c)(2) Unusual and Compelling Urgency as defined in FAR Part 6.302-2(a)(2) which states: When the agency’s need for the supplies or services is of such an unusual and compelling urgency that the Government would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals, full and open competition need not be provided for.

The estimated cost is $10,160,000.00. It is the Government’s intent, based upon the following, to award multiple one- year IDIQ contracts.

2. Description of Agency Needs (10 U.S.C. 2304(f)(3)(A)):

a. Background:

As the DoD Integrated Materiel Manager for bulk Helium starting in 2004, DESC negotiated contracts for supply of this product in support of DOD Aerostat programs in

Iraq and Afghanistan. Also, DESC has contracted to build High Pressure Cylinder

Assemblies (HPCAs) and to refurbish various sizes of tube trailers to transport the

Helium by land and air. Pursuant to its designation as the DOD IMM, the current

OCONUS supply contract was awarded in August 2009 to Global Gases & Chemicals, Inc. in Dubai, U.A.E.

Currently, DESC’s fleet in the AOR consists of 115 tube trailers and 80 HPCAs with a total capacity of 208,000 m³. This fleet, along with a DFSP at Camp Sather, Iraq, enables

DESC to provide a stable supply-chain to deploy and sustain the Persistent Threat

Detection System (PTDS) and the Rapid Aerostat Initial Deployment (RAID) aerostats in the Iraq and Afghanistan theaters of operation.

b. Requirement:

Currently, the Army operates 28 RAID and PTDS aerostat systems in OEF and OIF. The

Secretary of Defense has identified a requirement for an additional 58 Aerostat systems for immediate OEF deployment encompassing both the PTDS and Persistent Ground

Surveillance Systems (PGSS) Programs. These additional 58 system deployments bring the total operational aerostat fleet to 86 systems in the theater of operations. As a result, the Helium and equipment support needed to fill and sustain the aerostats has increased significantly.

With the increase in demand, DESC needs 624,000 m³ in-transit, awaiting fill at the

DFSP, or in-place at the sites. As a consequence DESC must increase its helium capacity by 416,000 m³ or 14,690,901 ft³. DESC will begin an immediate procurement of transportation equipment to support the additional volume of helium, including this purchase of an estimated 40 ISO Containers with chassis capable of holding 90,000 to

100, 000 ft³ each, plus an additional 20 ISO Containers with chassis capable of holding

50,000 to 89,000 ft 3, thereby increasing supply-chain capacity by 5,700,000 ft . DESC is seeking other means to supply and transport the remaining helium requirements. The

ISO Containers with chassis will require certification for airlift capability on U.S.

Military Aircraft by the Aeronautical Transportability Test Loading Agency (ATTLA).

3. Authority for Other than Full and Open Competition (10 U.S.C. 2304 (f) (3) (B)):

FAR 6.302-2 UNUSUAL AND COMPELLING URGENCY, 10 U.S.C. 2304(c)(2), paragraph (a)(2) states that full and open competition need not be provided for when the agency’s need is of such an unusual and compelling urgency that the Government would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals. According to paragraph (b), this authority applies in situations where an unusual and compelling urgency precludes full and open competition and delay in award of a contract would result in serious injury, financial or other, to the

Government. Such is the case for the procurement of ISO/Chassis as described herein.

DESC was officially notified of the requirement for additional helium and support equipment in a letter from the Department of the Army dated March 12, 2010, incorporated herein by reference. Below is a direct quotation from the letter:

“The Vice Chief of Staff of the Army (VCSA) and Deputy Chiefs of Staffs (DCSs), G-

3/5/7 identified a capability gap for the persistent Full Motion Video (FMV) in the

Afghanistan theater of operations that, if not resolved immediately, would result in continued loss of life, serious injury, and compromised mission effectiveness because of increasing insurgent activities in Afghanistan, including Improvised Explosive

Device (IED) emplacement, IED networks, and other ground-based threats against US and Coalition forces.”

In addition, the PTDS and PGSS Program Offices, led by BG Thomas Cole, PEO, Intelligence, Electronic Warfare and Sensors (IEW&S) notified DESC that the US Army will have a major plus-up of Aerostats in support of OEF dramatically affecting DESC’s

Concept of Operations (CONOPs). Within these communications, DESC was informed that the Army would provide funds for purchase of equipment, such as ISOs with

Chassis, required to support the surge in helium requirements. However, the funding has not been made available. The Director of DESC-M, Ms. Sharon Murphy, through the

Deputy Director of Operations, discussed the funding with DESC’s Comptroller and asked if DESC funds could be made available so that the procurement process could begin. On April 2, 2010 Ms. Murphy received approval from the Comptroller that DESC funds would be available for the procurement. Immediately, the procurement process began with development of this J&A and notification to DESC’s Small Business office of the pending procurement.

The above chain-of-events lead to the urgency of this procurement. DESC‘s total current fleet capacity stands at 208,000 m³, and adequately sustains the supply-chain. However, an increase of 58 aerostats for OEF increases the demand for Helium by 300%. At present, DESC’s fleet operates at a lean and well synchronized pace with about 18,024 m³ or 8% of total capacity deployable from the DFSP at a given time. The remainder is in-place or in-transit. With the increase of aerostats, DESC will fall short of containers to support the surges in helium requirement by July 2010. The acquisition strategy is to award multiple IDIQ contracts no later than April 30, 2010. It is critical to award the contracts as soon as possible to give contractors the entire months of May and June for either manufacture of new ISO’s and/or the retrofitting of existing ISO’s, and then sufficient time for contractors to have the equipment ATTLA certified. Hopefully, certification can be accomplished in 30 days or less.

According to FAR 6.302-2 (c) (2) Limitations, the statutory authority to limit the procurement to other than full and open competition, based on unusual and compelling urgency, requires that agencies request offers from as many potential sources as is practicable under the circumstances. Therefore, because of the urgency of the requirement, the production lead times, the small industry base, and the airlift certification required by ATTLA, DESC proposes to limit the sources to the following four contractors: (1) Western Sales of Amarillo, (2) Weldship, Inc., (3) FIBA

Technologies, and (4) GTM Manufacturing. Our market survey indicated these four companies (all small businesses) are postured to meet the technical specifications and the delivery schedule. Additionally, all four companies have expressed a willingness to have their ISOs/Chassis certified by ATTLA for air lift capability on a U.S. Military C-5 or C-

17 aircraft.

4. Price/Cost considerations (10 U.S.C. 2304 (f) (3) (C)): Pursuant to FAR 15.404-

1(b)(2)(i), adequate price competition normally establishes price reasonableness. With four known interested sources, DESC will obtain competitive prices and should be able to determine a fair and reasonable price based on adequate price competition. To provide scheduling flexibility and enough time to manufacture and certify the ISO’s, DESC will award multiple ID/IQ contracts with minimum and maximum quantities for each awardee as required by FAR 16.504(a).

5. Market Research/Efforts to Obtain Competition (10 U.S.C. 2304 (f) (3) (D) &

(E)): The four companies are capable of immediately providing ISOs from their current inventory with minor changes for air lift capability. They can also begin production to meet the immediate and near future requirement to accommodate the gradual delivery schedule over a period of one year. Therefore, DESC expects adequate competition using price comparison IAW FAR 15.403-1(c)(1). For any future procurements of ISOs, DESC-MK will conduct the acquisition using full and open competitive procedures assuming the Aerostat customers give DESC sufficient notice of any additional increase in Aerostats. To that end, additional market research will be conducted in order to ensure maximum competition,

6. Actions Being Taken to Overcome Barriers to Competition (10 U.S.C. 2304 (f) (3)

(F)): This procurement is being competed among four contractors. When any future requirements arise for procurement of ISO containers with chassis, DESC will make every effort to find additional sources, to include advertisement in Federal Business

Opportunities and further Market Research and to utilize full and open competitive procedures to the extent practicable.