Redacted_JA_SPRDL1-17-R-0344.pdf

J&A SPRDL1-17-R-0344

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Agency: The Contracting Activity for this action is the Defense Logistics Agency -Warren (DLA-WRN)

2. Description of Action: The proposed contract action is to award a routine replenishment of stock for the Palletized Loading System Hydraulic Hoist Unit (NSN 2590-01-354-9107). Competition will be limited approved sources for this hoist unit:

Grove U.S. L.L.C. DBA Manitowoc Crane Group (CAGE: 12361), PN: 6-974-001705 Oshkosh Defense, L.L.C. (CAGE: 75Q65), PN: 1HT2016

3. Description of Supplies/Services: The approved contractors identified in Section 2 shall provide the Hydraulic Hoist Unit (NSN 2590-01-354-9107) used on the Palletized Loading System vehicle. This purchase is for a regular replenishment of the mission-essential Hydraulic Hoist Unit. The total estimated maximum value of this contract is $158,602.80.

The Acquisition Method Code (AMC) for this part is 1: Suitable for competitive acquisition for the second or subsequent time.

The Acquisition Method Suffix Code (AMSC) AMSC H. The Government physically does not have in its possession sufficient, accurate, or legible data to purchase this part from other than the current source(s). This code is applicable only to parts under immediate buy requirements and only for as long thereafter as the deficiency is under review for resolution and appropriate recoding. This code is only assigned at the conclusion of limited screening, and it remains assigned until the full screening process resolves physical data questions and results in assignment of a different AMSC. If one source is available, AMCs 3, 4, or 5 are valid. If at least two sources exist, AMCs 1 or 2 are valid.

4. Authority Cited: The statutory authority permitting other than full and open competition is 10 USC 2304(c) (1), as implemented by FAR 6.302-1, “Only one responsible source and no other supplies or services will satisfy agency requirements.”

FAR 6.302-1(a)(2)(ii)(A)(B) provides that “supplies may be deemed available only from one or a limited number of responsible sources, and no other type of supplies or services will satisfy agency requirements, full and open competition need not be provided for. Supplies may be deemed to be available from the original sources in the case of a follow-on contract when award to another sources would result in substantial duplication costs to the Government that would not be recovered through competition or unacceptable delays in filling the Government's requirements”.

5. Reason for Authority Cited: The U.S. Government does not own or have rights to any of the technical data for the Hydraulic Hoist Unit (NSN 2590-01-354-9107). The approved sources are the owners of the intellectual property and retains full-rights-in-data for its technical data.

The TARDEC Tactical Vehicle Engineering Sustainment Team has estimated that reverse engineering the Hydraulic Hoist Unit (NSN 2590-01-354-9107) would cost $1,000,000 - $1,500,000 for development, testing, qualification, and production tooling.

TARDEC’s contention is that a mechanism to recover their investment must be demonstrated by the Government before they will consider it. In addition, a minimum lead-time of 12 months is required to meet the vehicle's mission performance requirements based on historical hydraulic hoist testing. This delay is unacceptable in support of the mission for this vehicle, where immediate replenishment is needed in order to meet mission objectives and preserve readiness.

Reverse engineering TDP development is not feasible due to requirements of the component’s material properties which cannot not be readily identified. Because of the uncertain definition of requirements, an increased mission risk is possible in which failure of one of these items could result in failure of the hoist, leaving the Palletized Loading System incapable of completing its mission and an inherent safety concern with a failing hoist suspending a load.

The quantity involved on the contract of the sole source components does not justify the development and production tooling costs for a company to qualify as a second source.

Qualification Testing to include material test, form, fit, function test, performance test and durability test would require at least twelve (12) months and up to $1.5M. This expense could not be recouped through subsequent competition. To neglect qualification testing would be a high risk as premature failures of this item in the field could result in mission failure which could jeopardize the Army’s mission in a potentially adverse operational environment. Funds are not available at this time for either procuring the proprietary data or reverse engineering the item to create a competitive TDP or qualification testing for a new source. Ultimately, there is a vital need for correct approved components to be contractually obtained under this PRON to maintain readiness and avoid vehicle dead-lining due to supply problems.

6. Efforts to Obtain Competition: No vendors are in the process of being qualified at this time, nor will be prior to the contract award due to funding constraints. Additionally, there are no planned efforts to qualify additional sources due to the fact that that there is no technical data available to produce a competitive TDP, nor are there any funds available to conduct the extensive (costly and time consuming) qualification testing requirements. Additional interested contractors can seek qualification through the

Source Approval Program with the Competition Management Office. Currently, there has not been any expressed interest by any known vendor(s) to become a qualified source(s) to produce this item.

7. Actions to Increase Competition:

It is not beneficial to increase competition because the Government does not own or have rights to the technical data for the Hydraulic Hoist Unit (NSN 2590-01-354-9107). It would take up to 12 months to develop a competitive technical data package with an estimated maximum cost of up to $1.5M. The time and money costs would not be recouped through competition. Additional sources cannot be considered at this time.

8. Market Research:

The government has no funding to qualify additional sources, and thusly any qualification would be done at contractor’s expense. Additional contractors can seek qualification through the Source Approval Program with the Competition Management Office. Given that no technical data is available for the Hydraulic Hoist, market research results are very limited. This is mainly based on the fact that some type of information is required prior to conducting market research. For example, market research can be conducted on this Hoist, but without having any technical specifications, the range of information on this component will be vast, thus not useful. Hence, it is imperative that some technical information be available in order to conduct valuable market research.

A general internet search was conducted by the Project Engineer during February 2017.

However, the information found was too generic due to the rationale provided above.

The results of this generic search were that no other sources exist or are anticipated to become available to satisfy the Government’s requirement to meet readiness.

When and if the technical information for the Hydraulic Hoist is eventually made available, specific market research can then be conducted and competitive procurement considered. Furthermore, a “sources sought” synopsis is not an option at this moment for this action as the government is not in a position to help qualify additional vendors due to a significant lack of information, funding constraints, as well as ongoing evolutionary vehicle design configuration changes of which details are unknown.

9. Interested Sources: A sources sought notice was requested on June 5, 2017.

Interested contractors can seek qualification through the Source Approval Program with the Competition Management Office. To date, no other sources have written to express an interest, nor has the Government identified any other source having an interest in being an alternate source for this NSN.

10. Other Facts:

a. Procurement History

b. Acquisition data availability. The Government does not own or have rights to the technical data for the Hydraulic Hoist Unit.

c. Unusual and compelling urgency: N/A

d. Subcontracting Competition: The government will require the chosen contractor to submit a subcontracting plan IAW FAR 19.704 during negotiations of the contract in order to achieve increased small business subcontracting opportunities throughout the life of the contract.

11. Technical Certification: I hereby certify that the supporting data under my cognizance which are included in the justification are accurate and complete to the best of my knowledge and belief.

Name: Michael Rogers Date: 2/14/2017 Title: Mechanical Engineer 0830 Signature: //s// Michael Rogers

Name: Mohan S. Khabra Date: 2/16/2017 Title: Supervisor, Tactical Trucks Signature: //Signed//

12. Requirement Certification: I certify that the supporting data under my cognizance which are included in the justification are accurate and complete to the best of my knowledge and belief.

Name: Ebony A. Lindsey Date: 17 Feb 2017 Title: Secondary Item Manager Signature: //Signed// Ebony A. Lindsey

NIIN Date Contract No SOS Qty Price Total UI CAGE Vendor

01‐354‐9107 2011/9 SPRDL109D0045 AKZ 5 12,976.99$ $64,884.95 EA 12361 GROVE U.S. L

01‐354‐9107 2009/7 SPRDL109D0045 AKZ 3 $11,997.95 $35,993.85 EA 12361 GROVE U.S. L

01‐354‐9107 2008/6 W56HZV04D0288 AKZ 5 0.00 0.00 EA 12361 GROVE U.S. L

01‐354‐9107 2008/6 W56HZV04D0288 AKZ 5 $11,496.50 $57,482.50 EA 12361 GROVE U.S. L

01‐354‐9107 2008/3 W56HZV04D0288 AKZ 6 0.00 0.00 EA 12361 GROVE U.S. L

01‐354‐9107 2008/3 W56HZV04D0288 AKZ 6 $11,496.50 $68,979.00 EA 12361 GROVE U.S. L

01‐354‐9107 2006/12 W56HZV04D0288 AKZ 10 $11,271.08 $112,710.80 EA 12361 GROVE U.S. L

01‐354‐9107 2004/10 W56HZV04D0288 AKZ 5 $10,833.42 $54,167.10 EA 12361 GROVE U.S. L

Name: Michael C. Wimmer II Date: 17 Feb 2017 Title: Supply/RESET Lead, Trailers and Heavy Tactical Secondary Item Management Team

Signature: //Signed// Michael C. Wimmer II

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost for this contract action will be fair and reasonable. The contractor’s proposal will be reviewed by Government requirements personnel who will address the appropriateness of the proposed labor hours and labor categories, material, other direct costs, and other cost elements as requested by the Contracting Officer. Cost/price analysis and audit recommendations will be used to discern whether the costs proposed are current and justifiable. Certified cost and pricing data will not be required to justify price reasonableness.

Name: Karen Kaczorowski Date: 5 Jun 2017 Title: Contracting Officer Signature: //s//

14. Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief.

Name: Karen Kaczorowski Date: 5 Jun 2017 Title: Contracting Officer Signature: //s//

15. Legal Concurrence:

Name: Eric Selke Date: 8 JUN 17 Signature: //signed/ECS//

Previous_JA_SPRDL1 -09-R-0091