REDACTED_JA_SPRDL1-17-R-0522.pdf

J&A SPRDL1-17-R-0522

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Agency: Defense Logistics Agency Land Warren

2. Description of Action: The proposed contract action is to award a new, firm-fixed-price contract for nine drum winches used on the M1070 with a 100% option. Competition will be limited to either DP Manufacturing Inc. (CAGE 0EJ14; P/N 51882-004) or Oshkosh Defense LLC (CAGE 75Q65; P/N 22KP502).

This action will be funded using Army Working Capital Funds (AWCF).

3. Description of Supplies/Services: The contractors shall provide the spare parts listed in Table 1, to be used on the M1070.

Unit Price: $ Quantity: 9 Total (including option): 18 Total Estimated value of this contract (with option): $

Table 1 – List all spare parts

NSN NOMENCLATURE VENDOR P/N

2590-01-592-5927 Winch, Drum, Vehicle Mounting DP Manufacturing Inc. (CAGE 0EJ14)

51882-004

Oshkosh Defense

LLC (CAGE 75Q65)

22KP502

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

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.”

5. Reason for Authority Cited: The approved contractors (Oshkosh and DP Winch) designed and tested the Winch Drum for the HEMTT Trucks. The Government does not own any data or patent rights to this item. No technical data exists that would define production specifications for the Winch Drum, and since the item was developed and tested at private expense, such data is considered proprietary to the suppliers. The government did not purchase the TDP because at the time the cost to purchase the TDP was considered cost prohibitive. Oshkosh Corporation is an international company with over 17,000 employees with sales of over $7 billion and engages in the design, manufacture, and marketing of various specialty vehicles and vehicle bodies worldwide. The defense segment of Oshkosh manufactures severe-duty, heavy, and medium-payload tactical trucks for the Department of Defense, including hauling tanks, missile systems, ammunition, fuel, and cargo for combat units. Oshkosh and DP Winch have had a working relationship in the defense accessories business for years through the DP Winch corporate structure. DP Winch is part of the Tulsa Winch Group (TWG) of Tulsa, OK. TWG is composed of four companies: DP Winch, Tulsa Winch, Pull Master and Greer Company, which is all owned by Dover Corporation. Dover Corporation is a diversified international Fortune 500 company which employs over 34,000 personnel and manages more than 40 companies that make equipment ranging from garbage trucks, flatbed trailers (Heil Inc), to ink-jet printers, and has four groups: Electronic Technologies, Engineered Systems, Fluid Management, and Industrial Products with sales of nearly $8 Billion. It is though the Industrial Products Division that Oshkosh and DP work together.

The primary consideration was for the contractors to provide a supply of spare parts, serve as an item manager, perform depot repairs and configuration management. The primary incentive was to rely on Contractor Logistics Support (CLS) which was translated into large dollar cost avoidances to the government.

Oshkosh and DP Manufacturing are the sole owners of the drawings and the technical data rights, and therefore the government does not own the proprietary rights to the TDP that would be required to produce a competitive TDP. The non-availability of technical data requires that this item be procured on a non-competitive basis from the current manufacturers, for the replenishment of spare parts. TACOM engineers have analyzed the length of time (10 months minimum) required to develop a fully defined TDP and determined that it would cause an unacceptable delay in fulfilling TACOM’s current requirements. It would also have a significant detrimental impact on TACOM's ability to support the solider in the field. It is estimated that over $200,000 of funds would be required to develop a new TDP, and test/qualify new sources. These funds cannot be recouped by competitive procurement of this item. At this time funding is not available to support this effort. The expense to procure or to reverse engineer the TDP could not be recouped through subsequent competitive procurement.

This item consists of as many as forty sub-components, gears, carrier assemblies and materials that constitute a unique item. No sub-components are defined. The government does not possess the Winch Drum TDP. Efforts to procure a TDP for the item would not be cost effective; estimates to procure a TDP package from the contractor would be in excess of $200,000.00 and result in a delay of 12 months. These and other estimates are based on previous experience or prior procurements. This expense could not be recouped through subsequent competitive procurement. There are no current plans to acquire a competitive TDP.

Total Cost and Delays to procure TDP: $200,000 and 12 months delay.

Through previous experience, Government engineering estimates that the cost to develop a competitive procurement package for the item through reverse engineering could run as high as $150,000 and could require an estimated delay of at least six (6) months. Fabrication of a reverse engineered prototype would take as long as six (6) months and cost up to $100,000. Qualification and durability testing would be required to prove out this item manufactured by new sources. Testing and qualification would require at least another four (4) months and up to an additional $75,000.

Development of a competitive TDP and fabrication: $250,000 / 12 months delay Qualification testing of a New Source: $75,000 /4 months delay Total Cost and Delays for TDP Development & Prove-out: $325,000 / 16 month delay

To pursue this effort through an independent contractor, Government engineering estimates that the cost to develop a competitive procurement package for the item through reverse engineering could run as high as $250,000 and could require an estimated delay of 12 months. Fabrication of a reverse engineered prototype would take as long as 9 months and cost $100,000.

Qualification and durability testing would be required to prove out this item manufactured by new independent sources. Testing and qualification would require at least another 4 months and up to an additional $75,000.

Cost and Delays to develop and prove-out with independent contractor:

Development of a competitive TDP: $350,000 and 21 months Qualification testing of a New Independent Source: $75,000 and 4 months.

Total: $425,000 and 25 months.

To neglect testing and qualification would be a high risk as a premature failures of this item in the field could result in extensive loss of equipment. Testing could also surface latent defects that would adversely impact the readiness of the equipment and Operational and Support (O & S) costs. Due to lack of funding and urgency of the item requirement, the Government would not be able to conduct reverse engineering efforts at this time. The Government would not be able to recover, through subsequent competition, the additional costs involved in either procuring the proprietary data or reverse engineering the item to create a competitive package. The delay associated with these efforts is unacceptable in fulfilling TACOM requirements and would have a significant detrimental impact on TACOM’s ability to support the soldier in the field.

Funds are not available for either procuring the proprietary data or reverse engineering the item to create a competitive package. The delay associated with these efforts is unacceptable in fulfilling TACOM requirements and would have a significant detrimental impact on TACOM’s ability to support the soldier in the field.

6. Efforts to Obtain Competition: This action is limited to DP Manufacturing Inc.

(CAGE 0EJ14; P/N 51882-004) or Oshkosh Defense LLC (CAGE 75Q65; P/N 22KP502), the owners of the intellectual property and manufacturers of this item.

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: Although this will be restricted to the above sources, every effort will be made to obtain potential sources by posting in the TACOM contracting Web Site. Any supplier who can provide the item referenced by the National Stock Number (NSN) in the quantities required by the contract may bid on this solicitation. Interested sources can seek approval through the Source Approval Program with the Competition Management Office. To date, there has not been any expressed interest by any other known vendors to become qualified to produce this item.

No vendors are in the process of being qualified at this time, nor will be prior to the contract award due to funding constraints. At this time, there are no current or 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. It is not beneficial to increase competition for this procurement because the Government does not own or have rights to the technical data for this item. The time and money costs would not be recouped through competition.

8. Market Research: Market research was performed to see if any other sources exist and to determine if commercial items or non-developmental items are available to meet government needs or could be modified to meet government needs.

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.

POC: Email: l

Signature: Date: 2/2/2018 Title: Signature: //Signed//

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

Name:

Title Date: 2/2/2018 Signature:

Name Title:

Date: 2/2/2018 Signature:

Name:

Title:

Date:2/5/2018 Signature //

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable. This determination will be based on the results of a price analysis.

The contractor will not be required to submit Certified Cost or Pricing Data as this has been determined to be a commercial item.

Name: Leah Bourdeau Title: Contracting Officer Date: 3/7/18 Signature: //s// LCB

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

Name: Leah Bourdeau Title: Contracting Officer Date: 3/7/18 Signature: //s// LCB

15. Legal Concurrence:

Signature: // Date: 03/08/2018