JA_SPRDL1-17-R-0346_Redacted.pdf

Solicitation No. SPRDL1-17-R-0346

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

SOLICITATION NO. SPRDL1-17-R-0346

1. Contracting Agency: Defense Logistics Agency-Warren (DLA) Land Warren.

2. Description of Action: The proposed contract action is for purchase of directional control linear valves with a 100% option. Competition will be restricted to the approved sources only – namely, Oshkosh Defense, LLC (CAGE: 75Q65) and Rexroth Corporation (CAGE: 58114). This action will be funded using Army Working Capital Funds (AWCF).

3. Description of Supplies/Services: The proposed contract action is to procure 1,029 directional control linear valves (NSN 4820-01-226-5297; Oshkosh Defense, LLC Part Number 1471160 or Rexroth Corporation Part Number 1602-002-066) at an estimated cost of , for a maximum estimated contract value of . This is a final production run for the manufacturer before the part becomes obsolete and is no longer manufactured. Pertinent details regarding the proposed acquisition are listed below:

NSN Nomenclature Manufacturer P/N Acquisition Method Code

4820-01-226-5297 Valve, Linear, Directional Control

Oshkosh Defense, LLC P/N 1471160 or Rexroth Corporation P/N 1602-002-066

3D

Acquisition Method Code (AMC): 3 – Acquire, for the second or subsequent time, directly from the actual manufacturer.

Acquisition Method Suffix Code (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.

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.”

5. Reason for Authority Cited: The U.S. Government does not own or have rights to any of the technical data for the desired valve. Oshkosh Defense, LLC, and Rexroth

Corporation own the intellectual property and retain full-rights-in-data for its respective technical data.

The TARDEC Tactical Vehicle Engineering Sustainment Team has estimated that reverse engineering the Directional Control Linear Valve would cost a minimum of $1M with a lead time of 16 months for design, development, and production. In addition, the valve would have to undergo qualification testing. Valve qualification testing on a HEMTT vehicle would require an additional lead time of 8 months and require an additional $600K in funds, for a total estimated cost of at least $1.6M and a lead time of no less than 24 months. .

TARDEC’s longstanding position is that a mechanism to recover such an investment of resources shall be demonstrated by the Government before being considered.

TARDEC’s conclusion is that such expenses could not be recouped through subsequent competition. Furthermore, the efforts involved do not justify the development and production tooling costs for a company to qualify as a third source.

Neglecting the qualification testing would incur significant risk of premature failure of this item in the field, resulting in mission failure and jeopardizing the Army’s mission in a potentially adverse operational environment.

The total lead time of up to 24 months for reverse engineering and qualification testing for a third approved source of the valve is unacceptable, and would greatly reduce readiness for the HEMTT.

Ultimately, a vital need exists for the correct approved components to be contractually obtained under this contract action to maintain readiness and avoid vehicle dead-lining due to supply problems. This part is on the brink of being obsolete, per the vendors, so this lot buy is to serve for current and future demand.

6. Efforts to Obtain Competition: Currently, 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. To date, 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: There are no known funding efforts in progress at this time to acquire the commercially controlled data needed to make these parts competitive. Furthermore, the resources invested in such an effort – both in time and money – would not be recouped through competition.

8. Market Research: The government has no funding to qualify additional sources, and thusly any qualification would be done at contractor’s expense. That said, additional contractors may seek qualification through the Source Approval Program with the Competition Management Office. Given that no technical data is available for this valve, market research results are very limited. However, general computer based market research was conducted by the Project Engineer in April 2017 which did not find any additional sources that exist to satisfy the Government’s requirement.

9. Interested Sources: A sources sought synopsis was posted to FedBizOpps on 9 June 2017. To date, no other sources have written to express an interest.

Nevertheless, offerors are always encouraged to seek qualification through TACOM’s Source Approval Program (SAP) with the CMO. Additionally, the synopsis notice required by FAR 5.201 will be published and any proposals received shall be considered.

10. Other Facts:

a. Procurement History (Last 2 buys):

(1) Contract: SPRDL1-09-D-0026

Award Date: June 2010 Contractor: Ruta Supplies, Inc.

Value: $102,052.80

Competitive Status: Limited Source Authority: FAR 6.302-1, Only One Responsible Source

(2) Contract: W56HZV-04-D-0177

Award Date: March 2009 Contractor: Oshkosh Defense, LLC.

Value: $129,066.24 Competitive Status: Limited Source Authority: FAR 6.302-1, Only One Responsible Source

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

c. Unusual and compelling urgency: N/A

d. Subcontracting Competition: N/A

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.

16. Division Chief Approval:

Name:

Title:

Date: 14 Nov. 2017 Signature:

Approval Authority for Acquisitions Equal to or Greater Than $700,000

APPROVAL OF JUSTIFICATION

FOR OTHER THAN FULL AND OPEN COMPETITION

Based on the foregoing Justification, I hereby approve the procurement of the following:

a. Noun: Valve, Linear, Directional Control

b. NSN: 4820-01-226-5297

c. Quantity: 1,029

d. Estimated Value:

This action will be awarded under other than full and open competition pursuant to the authority of 10 USC 2304(c)(1) and subject to the availability of funds. This approval is subject to the proviso that the property herein described has otherwise been authorized for acquisition.

NAME:

TITLE:

SIGNATURE:

Date: 20 Nov 2017