SPE7MX19R0045_-_reviewed_Redacted.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

SOLICITATION SPE7MX19R0045

DLA Land and Maritime Justification and Approval for Other than Full and Open Competition (J&A) (April 2014)

ORIGINAL

ADDENDUM

1. The Defense Logistics Agency, DLA Land and Maritime, is the contracting activity.

2. The action being approved is the acquisition of supplies on other-than a full and open competition basis—Sole Source Woman-Owned Small Business (WOSB) Indefinite Quantity Contract in accordance with FAR 6.302-5(b)(7).

3. The supplies required to meet the using activity's needs are described as follows:

NSN ITEM AMC AMSC ADQ ADV

4810013926648 ACTUATOR,ELECTRO-MECHANICAL 3 C 6

4810013990948 ACTUATOR,ELECTRO-MECHANICAL 3 D 5

4810014220876 VALVE,BUTTERFLY 3 C 13

4810014483989 VALVE,GATE 3 C 9

ADV

3 x ADV

The approved part numbers are:

NSN CAGE COMPANY NAME Part Number

4810013926648 66822 MORPAC INDUSTRIES, INC. DBA 20009-1

4810013926648 66822 MORPAC INDUSTRIES, INC. DBA 20009 ASSY 1

4810013990948 66822 MORPAC INDUSTRIES, INC. DBA 20008-3

4810013990948 66822 MORPAC INDUSTRIES, INC. DBA 20008 ASSY 3

4810014220876 66822 MORPAC INDUSTRIES, INC. DBA 10005-3

4810014483989 66822 MORPAC INDUSTRIES, INC. DBA 10018-2

4810014483989 66822 MORPAC INDUSTRIES, INC. DBA 10018-1

Identify end item, weapon system, or class of item:

This requirement is in support, but not limited to the Arleigh Burke-Class guided missile destroyer.

ESTIMATED BASE VALUE (3-yr base): (no option periods)

MAXIMUM CONTRACT VALUE:

4. The statutory authority permitting other than full and open competition is:

10 U.S.C. 2304(c)(5) – authorized or required by statute and

10 U.S.C. 2304(c)(1) – only one approved source

5. A demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited in paragraph 4:

The acquisition is being solicited as a sole source WOSB set-aside to Morpac Industries pursuant to 15 U.S.C. 637(m). The following requirements under FAR 19.1506(b) are satisfied: the NAICS code is on the SBA’s list of WOSBs substantially underrepresented in Federal procurement established by SBA at http://www.sba.gov/WOSB, under $6.5 Million, a reasonable expectation of receiving only one eligible WOSB offer, and the acquisition can be awarded at a fair and reasonable price(s). Because of the unique qualifications of the current approved source and that the source deals directly with the Government, it is not expected that offers would be received from two or more eligible and qualified WOSB concerns. Morpac has been determined to be a responsible contractor with respect to performance based on past procurements.

Morpac Industries (66822) is a woman-owned small business and currently is the only approved source for the items being procured. The contractor has designed these valves and actuators to withstand specific salt spray and shock tests required the Naval Command and retains rights of the data and manufacturing knowledge. Each part is complex in design, including many many specialized components. These parts must fit the next higher assembly to be completely functional. The contractor provided proprietary drawings to the Contracting Officer to view the complexity of the parts being procured; however, the Government does not have rights use these drawings for competitive procurement. These items are specifically designed to satisfy the needs of the warfighter. For the three items with AMSC=C, an alternate source must qualify in accordance with the design control activity's procedures.

The use of the authority cited is based on:

AMC 3. Acquire, for the second or subsequent time, directly from the manufacturer.

AMSC C. This part requires engineering source approval by the design control activity in order to maintain the quality of the part. Existing unique design capability, engineering skills, and manufacturing knowledge by the qualified source(s) require acquisition of the part from the approved source(s). The approved source(s) retain data rights, manufacturing knowledge, or technical data that are not economically available to the Government, and the data or knowledge is essential to maintaining the quality of the part. An alternate source must qualify in accordance with the design control activity's procedures, as approved by the cognizant Government engineering activity. The qualification procedures must be approved by the Government engineering activity having jurisdiction over the part in the intended application. If one source is approved, AMCs 3, 4, or 5 are valid. If at least two sources are approved or if data is adequate for an alternate source to qualify in accordance with the design control activity's procedures, AMCs 1 or 2 are valid.

AMSC D. The data needed to acquire this part competitively is not physically available, it cannot be obtained economically, nor is it possible to draft adequate specifications or any other adequate, economical description of the material for a competitive solicitation. AMCS 3, 4, or 5 are valid.

6. Efforts to ensure that offers are solicited from as many sources as practicable are:

The acquisition will be synopsized on or about 2/27/2019.

7. I hereby determine that the anticipated cost to the Government will be fair and reasonable.

Per FAR 15.404-1(a)(2), a price analysis will be conducted. The price analysis will be conducted using historical pricing determined fair and reasonable for the same or similar items, the Producer Price index (PPI) and learning curve analysis. Additional information, such as other-than cost data, will be obtained from the offeror(s), as necessary.

Government should cost analysis may be requested by the Contracting Officer if necessary.

By using the above techniques, the Contracting Officer anticipates that the costs to the Government will be fair and reasonable.

8. Market Research/Efforts to Obtain Competition:

1/4/2018-Source Sought Notice posted with market survey and closed 1/11/2018. No responses received.

1/4/2018-Market survey sent to Morpac Industries, the approved manufacturer. Morpac responded 1/5/2018, providing information, such as delivery, minimum quantities, and other information pertinent to preparing a solicitation. They also stated that they would not provide certified cost data, since they have a very small company and they do not have enough resources to provide it. Morpac prefers to deal directly with the Government.

1/4/2018-Market survey sent to Triman Industries, who replied 1/16/2018 stating they will not participate, since they are not a dealer for Morpac.

8/6/2018-Buyer followed up on market survey from Morpac asking for more information to help with commerciality/non-commerciality determination. Morpac replied 8/13/2018.

Morpac does not sell valves and actuators commercially. They only sell these type of items to the U.S. Navy. The materials required for the military applications make the valves too expensive for commercial plumbing work. Morpac provided proprietary drawings to show the complexity of each valve or actuator.

2/8/2019-Review of Morpac’s website (Morpac.com) shows the commercial business consists of switches for high voltage lines, line stringing tools and cables for high tension lines, and repair parts for heavy duty off-road crawlers. This commercial business sustains the company so that it can provide the relatively smaller quantities of military-grade valves to the Navy. Telephone conversation with the business owner, , confirmed that she is willing to self-certify and upload the required documentation at the SBA’s website as a woman-owned small business. The buyer sent an email with the SBA website information.

The market research, especially the sources sought notice, confirms the expectation that only one offer from an eligible and qualified WOSB will be received, since Morpac prefers to deal directly with the Government.

Information received regarding the commerciality of the item(s): Because of the Navy’s requirements for salt water environment, these NSNs are made of naval bronze, stainless steel, and Monel, which are expensive, so these types of valves/actuators would not likely be used for commercial plumbing purposes. In addition, these valves and actuators must meet stringent engineering requirements for shock and vibration that would probably destroy commercial equipment. The commercial customers to whom Morpac sells these items are involved in ship repair or new shipbuilding, and in turn, sell the items to the Navy as the ultimate customer. Based on this information, the Contracting Officer determines these items to be non-commercial.

9. Additional facts supporting other than full and open competition are:

Based upon the technical certification on file in DLA Land and Maritime-VEP technical data is not available and cannot be developed to permit full and open competition. The data presently available reflects the minimum needs of the Government.

10. A listing of sources, if any, indicating an interest in the acquisition is:

Morpac Industries (66822)

11. Actions being taken to overcome barriers to competition:

The Agency will continue to review market conditions prior to any follow-on acquisition. Prospective suppliers seeking source approval may submit a Source Approval Request package requesting evaluation of its product's technical acceptability for future procurements.

12. A previous J&A is not attached, since the previous procurements were simplified acquisitions.

Attachment:

1 - Procurement Item Descriptions

CONTRACTING OFFICER CERTIFICATION

I hereby certify that the information contained in this justification is accurate and complete to the best of my knowledge and belief.

614-692-9252 2/22/2019

REBECCA H. HARTGE Phone Date Contracting Officer

Approval/Certification

I have reviewed and approve this justification. The estimated total value of the J&A is

MARY E. SHEARER Phone Date Competition Advocate

APPROVAL REQUIREMENTS

( ) Up to $700,000 Contracting Officer

(X) $700,000 to $13,500,000 Competition Advocate

( ) $13,500,00 –$93,000,000 Head of the Contracting Activity (HCA)

( ) over $93,000,000 Senior Procurement Executive (AQ)

HARTGE.REB

ECCA.H.12736

57475

Digitally signed by

HARTGE.REBECCA.H.12

73657475 Date: 2019.02.27 08:16:10 -05'00'

SHEARER.MAR

Y.E.1250702449

Digitally signed by

SHEARER.MARY.E.125070

Date: 2019.02.28 07:01:56 -05'00'