SPE4A218R0040_CLASS_REDACTED.pdf

Solicitation Number: SPE4A2-18-R0040

Source Selection Info-See FAR 2.101 and 3.104

CLASS JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITY

This Class Justification and Approval (Class J&A) authorizes the use of Other Than Full and Open Competition to support requirements generated by Department of Defense (DoD) activities specified later in this document. The contracting activity for this requirement is Defense Logistics Agency (DLA) Aviation, Richmond, Virginia, Strategic Acquisition Programs Directorate.

II. NATURE AND/OR DESCRIPTION OF THE ACTION BEING PROCESSED

Due to the circumstances described herein, this activity requests authority to acquire Eaton Industrial Corporation (Eaton) items/spares using Other Than Full and Open Competition as prescribed by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. This action will result in the award of a new contract, which will be a firm-fixed price, ID/IQ contract with a 1-year base period and a four (4) 1-year option periods for a potential duration of five (5) years. This sole source requirement will be purchased from Eaton’s Jackson facility, Irvine, California (Cage Code 0DT23).

Eaton Industrial Corporation 9650 Jeronimo Road Irvine, CA 92618

CAGE: 0DT23

Large Business

III. DESCRIPTION OF THE SUPPLIES/SERVICES REQUIRED TO MEET THE AGENCY’S

NEEDS

DLA Aviation, Strategic Acquisition, seeks to establish a follow-on corporate contract with Eaton for items managed and/or procured by any DLA activity and the Military Services. This Class J&A covers NSNs identified solely to Eaton Industrial Corporation, CAGE 0DT23. The items support various weapons systems including, but not limited to, the F-15 Eagle, F-16 Falcon, C-5, C- 130, B-1B Aircraft, and HH-60 Helicopter. The estimated annual quantities vary for each NSN. The Working Capital Fund will be used as the appropriation for orders resulting from this contract. Funding will be made available when a delivery order is issued against the contract.

This Class J&A will cover all sole source Eaton consumable and depot-level reparable spare parts for multiple Federal Supply Classes (FSCs). The NSN candidate population may be expanded to include other weapon systems and service managed items if/when additional sole source items are identified.

The dollar value of the contract is not anticipated to exceed the J&A threshold. This justification also covers the addition of items that become sole source after award, replacements for obsolete items, items that are newly developed by the contractor and coded sole source to include support for new platforms, and any other items for which the contractor is the sole source supplier. All NSNs included in the initial candidate population have been reviewed and confirmed as sole source to Eaton as detailed in Section V.

A class population of NSNs with an estimated five-year value of $ , inclusive of a surge requirement, has been identified for this acquisition. A group of forty (40) NSNs with an estimated five-year value of $ has been identified from the class population as the initial items to be solicited. The estimated values were calculated by using Estimated Annual Quantity multiplied by the Standard Unit Price multiplied by the total length of the contract, and is summarized as follows:

V. DEMONSTRATION THAT THE CONTRACTOR’S UNIQUE QUALIFICATIONS OR

NATURE OF THE ACQUISITION REQUIRES THE USE OF THE AUTHORITY CITED

ABOVE

The authority in Section IV above applies because Eaton (Cage 0DT23) is the only known source of supply for the items. Eaton (Cage 0DT23) is the sole source manufacturer and is the only responsible source that possesses the full capability to satisfy the agency’s requirements. Eaton (Cage 0DT23) is the only source that possesses the data, tooling, machining, and assembly capability to produce the items in accordance with the drawing requirements.

Technical certifications for the initial candidate population are included as Attachment 1. Based on the technical certifications, the acquisition is restricted to the only source of supply known to have the capability of furnishing the required items/spares, Eaton.

Furthermore, some of the items identified in the initial candidate population are currently supported by the existing sole source long-term contract, SPE4AX-13-D-9414, which expires on 12 June 2018. A copy of the prior J&A and Amendment is provided as Attachment 2. Therefore, this acquisition is additionally, in part, a follow-on contract for the continued production of highly specialized equipment where Eaton is the only firm capable of providing the supplies described in Section III above without the warfighter experiencing substantial duplication of costs that could not be expected to be recovered through competition and without the warfighter experiencing unacceptable delays in fulfilling its requirements. See FAR 6.302-1(a)(2)(ii).

VI. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE SOLICITED

FROM AS MANY POTENTIAL SOURCES AS DEEMED PRACTICABLE

This requirement will be synopsized on Federal Business Opportunities (FedBizOpps) as required by FAR 5.201. Although it is anticipated that sources having an interest in subcontracting may be identified through synopsis, a Sources Sought Notice (SPE4A2-18-R-0040) was posted in FedBizOpps on 15 May 2018. The notice indicated the intent to award a sole source contract in accordance with FAR 6.302-1 to Eaton for the identified NSNs. Interested parties were requested to identify their interest and capability to respond to the requirement. This Sources Sought Notice was for informational purposes only and not a request for an offer. Only Eaton responded to the Sources Sought Notice.

Although the Government does not own data to support acquisition of these NSNs from any other source, any source who responds to the Government as a result of this synopsis will be identified to the prime contractor as a potential for subcontracting possibilities.

VII. DETERMINATION BY THE CONTRACTING OFFICER THAT THE ANTICIPATED

COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE

Due to the fact there are a mixture of commercial and non-commercial items in this procurement, both FAR Part 12 and 15 procedures will apply.

For non-commercial items, the overall cost of this acquisition will be fair and reasonable to the Government. In accordance with FAR 15.404, it is anticipated that negotiations will be conducted using information other than cost or pricing data from the contractor. Thorough price analysis will be conducted using available information and approved pricing techniques that will support the contracting office in making a determination that the price paid to the contractor is fair and reasonable to the Government.

Based on the foregoing, the Contracting Officer hereby determines the anticipated cost to the Government will be fair and reasonable.

For the identified commercial items, the overall cost of this acquisition will be considered fair and reasonable based upon FAR 12 negotiation procedures using price and cost analysis. Methodologies to assure this will be: commercial pricing techniques utilizing publicly offered catalogs; comparison to historical contractor sales; and/or analysis of limited cost and pricing information which could be made available by the contractor. In the event that limited cost and pricing information is made available, the Government’s negotiation objective will be developed using local technical analysis applied to direct and indirect rate factors recommended by the DCAA and/or DCMA. Based on the foregoing, the Contracting Officer hereby determines the anticipated cost to the Government will be fair and reasonable.

VIII. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE RESULTS, OR

STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT CONDUCTED

Pursuant to FAR Part 10, efforts were made to conduct market research since the Government has internal information that demonstrates the items are not competitive. Methods used for research included internet searches (System for Award Management (SAM), USA Spending, North American Industry Classification System (NAICS) Code References) and direct contact with potential sources. A technical review certified the initial items to be solicited are coded as sole source to Eaton. Coordination with the DLA Aviation Competition Advocate reveals that there is extensive history to support that these items have been and will continue to be sole source to Eaton. As previously indicated, a Sources Sought Notice was posted to FedBizOpps to request responses from industry concerning their interest and capability in supplying the parts, with two responses received – one from a large business dealer and one from an unapproved small business manufacturer. Market research demonstrated that no source other than Eaton, the sole source manufacturer and contractor, is capable of satisfying contract requirements.

IX. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN

COMPETITION

Eaton is not willing to sell data rights to the Government, which means a technical data package, specification, and engineering description suitable for Full and Open Competition cannot be developed without reverse engineering. The Government has determined that reverse engineering is cost prohibitive.

X. LIST OF SOURCES, IF ANY, THAT EXPRESSED INTEREST IN THE ACQUISITION

Eaton. See Section VI above.

XI. 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

As previously stated, Eaton is the only source with the capability of manufacturing the required supplies;

therefore, the Government does not intend to compete this procurement. For any groups of NSNs to be potentially added to the contract under the authority of this Class J&A, a technical review, sole source certification, and synopsis will be performed prior to pricing and adding items to the contract via modification. Procurement Note M06 Evaluation of Offers for Part Numbered Items will be included in the solicitation to provide guidance for potential suppliers. The Competition Advocate will review the solicitation and all potential add-on items to locate additional sources of supply. Any items which become competitive after award will be removed from the contract in accordance with DLAD Procurement Note L27 Addition and Deletion of Items (Aug 2017).

XII. CONTRACTING OFFICER’S CERTIFICATION

The contracting officer’s signature on the Coordination and Approval Document evidences that he/she has determined this document to be both accurate and complete to the best of his/her knowledge and belief.

XIII. TECHNICAL/REQUIREMENTS PERSONNEL’S CERTIFICATION

As evidenced by their signatures on the Coordination and Approval Document, the technical and/or requirements personnel have certified that any supporting data contained herein, which is their responsibility, is both accurate and complete.