SPRWA126D0001_Redacted1.pdf

Controlled Unclassified Information

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

FD2060-22-32030, FD2060-23-00009

I. Agency and Contracting Activity.

This Justification and Approval (J&A) request authority for Other Than Full and Open Competition to support requirements generated for the Air Force Life Cycle Management Center (AFLCMC)/Common Avionics Branch (AFLCMC/WNY) in conjunction with the Air Force Sustainment Center (AFSC)/Common Avionics Supply Chain Management Squadron (AFSC/407 SCMS). The contracting agency for this requirement and Justification for Other Than Full and Open Competition is the Defense Logistics Agency Aviation (DLA). The purchase request number supporting this contracting action is FD2060-22-32030 (Production) and FD2060-23-00009 (Repair).

II. Nature and/or description of the action being approved.

This J&A is being submitted to establish a follow-on contracting vehicle to procure and repair Joint Helmet Mounted Cueing System (JHMCS). This J&A is to support United States Air Force (USAF), Navy, and Foreign Military Sales (FMS) customer requirements for the Joint Helmet Mounted Cueing System (JHMCS) components including consumable and Depot Level Reparable (DLR) spares. Due to the circumstances described herein, the activity requests authority to acquire the supplies listed and services in this document using Other Than Full and Open Competition as prescribed by Federal Acquisition Regulation (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 Indefinite Delivery/Requirements, FAR 16.503, type contract. Performance period for this contract will be 72 months (plus a six-month extension), which includes one three (3) year Basic Ordering Period plus three (3) one-year Ordering Periods. In addition, contract clause FAR 52.217-9, “Option to Extend the Term of the Contract” will be included to allow up to a maximum 6-month extension to the period of performance.

This sole source requirement will be purchased from the following company:

Collins Elbit Vision Systems, LLC (CEVS) 4700 Marine Creek Parkway Fort Worth TX 76179-3505

CAGE: 6VSE4

Large Business

This contract will be awarded as a Single Award Task Order/Delivery Order Contract.

DFARS 216.504(c)(3) states, “In accordance with Section 816 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), the determination at FAR 16.504(c)(1)(ii)(D) is not required if a justification has been executed, in accordance with FAR subpart 6.3 and subpart 206.3.

III. Description of supplies/services required to meet agency needs (including the estimated value).

DLA Aviation Warner Robins is proposing a joint opportunity contract between DLA Aviation and the USAF to acquire JHMCS consumable and depot level reparable (DLR) spares sole sourced to Collins Elbit Vision Systems (CEVS), formerly Rockwell Collins ESA Vision Systems, LLC and before that Vision International, LLC (VSI). This contract will support continuing requirements and provide sustainment support until the end of the contract performance periods. This contract will establish an agreement between the Government and CEVS that provides on-demand, performance-based repair, hardware deliveries and manufacturing that are sole source to CEVS. This contract will foster comprehensive supplier relationships by engaging both of CEV’s fifty percent (50%) business partners in conversations about costs and pricing, parts obsolescence, and schedules for repair performance; provide certainty to the supply chain by providing monthly demand needs and conducting monthly performance reviews; and enable efficiencies in the delivery of materials and repair services to support the Warfighter. The current contract will expire 30 August 2023. The period of performance will be for six years after the date of award and will include an option for a six-month extension.

This production and repair contract effort will provide all of the necessary parts and labor to manufacture and repair JHMCS items. All items covered by this contract will be military unique and sole-sourced to CEVS, who is the Original Equipment Manager (OEM) for the JHMCS components. The contract will be used to acquire manufacturing and repair services where the supplier is the only responsible source, to support sustainment of the JHMCS weapon system, platforms, Shop Replacement Units (SRUs), and Line Replacement Units (LRUs). There are 47 items included in the initial population which consists of: 29 consumable and 18 depot level repair (DLR) items. Additional items may be added if replacements are identified as obsolete items or additional sole source items are identified. The estimated value for this contract effort is $ and the performance period for this contract will be 72 months (plus an option for a six-month extension) which includes one three (3) Basic Ordering Period plus three (3) one-year Ordering Periods. The projected quantities, referenced in Attachment 1: Table 2: Production NSNs and Table 4: Repair NSNs, will be Best Estimated Quantities (BEQ) per year.

In the event a modification to add pricing for the Ordering Periods 4, 5, 6, and six month extension is not executed by the date of contract expiration, CEVS will accept contract extension(s) utilizing range pricing from the latest priced ordering period until negotiated prices are incorporated by contract modification.

IV. Statutory authority permitting other than full and open competition.

10 U.S.C. 3204 (a)(1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements

V. Demonstration that the contractor's unique qualifications or the nature of the acquisition requires use of the authority cited above (applicability of authority).

The JHMCS is a highly sophisticated and specialized human mounted avionics system designed to provide the aircraft fire control systems aircrew with the combat advantage of first look, first shot capability in the air-to-air, within visual range combat arena. It has a magnetic helmet-mounted tracker that determines where the pilot's head is pointed, combined with a miniature display system that projects information onto the pilot's visor.

The head tracker and visor display act as a targeting device that can aim sensors and weapons wherever the pilot is looking. JHMCS is installed on USAF F-15 and F-16 aircraft, United States Navy F-18 aircraft, and all the aforementioned platforms for FMS.

There are twenty-three (23) countries flying JHMCS configured jets. CEVS is the original OEM for the JHMCS components covered by this acquisition and includes various pieces mounted to the pilot’s helmet.

As the OEM, CEVS is the only source that has met the requirements and been approved as a source of supply for the military unique items covered under this acquisition since the calendar year (CY) 2000. Currently, there are still no commercial market sources for these JHMCS components outside of CEVS. The only viable alternative the Government has in production of the JHMCS spares is to attempt reverse engineering. Given the advanced technologies and high voltage aspects of JHMCS, it is considered high risk to reverse engineer. There are 47 items; 33 consumable and 14 depot level repair items included in the market research supporting this J&A. The USAF does not own the technical data to any of these items.

For our effort, there is a limited amount of capability and funding available to redesign obsolete parts (along with no bid from the OEM and any other potential manufacturing sources). These particular Next Higher Assembly (NHAs) NSNs are not considered obsolete at this point and would fall towards the bottom of the priority list to redesign and/or reverse engineer. In conclusion, the cost and time associated with reverse engineering these NSNs would cost the USAF an excess of and 8-10 years. This is a very optimistic forecast. If reverse engineering is attempted, a full First Article qualification, sled testing, and ejection testing would also need to be conducted. Based on past similar engineering acquisitions, the cost is prohibitive as is the acquisition time to POM for funding, negotiate/award a contract, perform reverse engineering, build first articles and test/evaluate.

For the subassemblies, within the NHA, with higher failure and replacement rates, the government has no proprietary rights on any data associated with these and is not authorized to do repairs in house. Reverse engineering or attainability of piece parts is futile since the government does not have the capability to do repairs without contractor supplied data via the Public Private Partnership with the Warner Robins Air Loistics Complex. Since the government has no data on reverse engineering JHMCS equipment, similar avionics items can be compared for cost analysis. Currently, the Microphone Station on the E-3 aircraft is in process of being reverse engineered. The Period of Performance (PoP) was initially two years and is continuing to be extended. The cost of this reverse engineering process has already exceeded Averaging a repair cost range of and a 25% reduction in repair costs, due to reverse engineering, and averaging a subassembly needs to be replaced 10 times a month, the fastest return on investment (ROI) would take more than 40 years. Since the current subassemblies are not becoming obsolete, there is no monetary or mission capability benefit in reverse engineering JHMCS system subassemblies since the ROI would extend far pass the retirement set for Calendar Year 2040.

For the consumable items, many of these components are low-cost to the government.

The monetary cost and time it takes to reverse engineer these items are not only high risk to the government, but uneconomical. Similar avionics items (the module and variable attenuator, and the APY ½ Push Button Switch) are currently reverse engineered and take upwards of two years and at a price point ranging from for the first phase of reverse engineering development. The total reverse engineering process, testing, and implementation takes on average three to five years. Assumning an initial investment of for a reverse engineering effort on the Visor Day Anti Scratch 25%/ NSN: 8475-01-475-4702, it would take approximately 42 years for the government to see a return on investment, which would be calander year 2065. The JHMCS system is slated to be retired in calander year 2040 and therefore would be uneconomical for the government to pursue.

Accordingly, an award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and unacceptable delays in fulfilling the Government’s requirements, per the AFLCMC JHMCS Program Management Office.

VI. Description of efforts made to ensure that offers are solicited from as many potential sources as practicable, including whether a notice was or will be publicized as required by subpart 5.2 and, if not, which exception under FAR 5.202 applies.

A Sources Sought (SS) was posted to SAM.gov on 4 February 2021 under Solicitation Number SPRWA1-23-R-JHMCS. The SS requested responses from interested vendors that possess the expertise, capabilities, and experience to meet qualification requirements for this effort. Two vendors, CEVS and Thales Defence, responded to the SS. The vendors were evaluated for their capability and CEVS was determined to be the only capable vender based on whether they have access to the proprietary data necessary to support this repair effort. The incumbent, CEVS was determined to be the only capable vendor.

The requirement will be synopsized in SAM.gov in accordance with FAR 5.201. It is anticipated that sources having an interest in subcontracting may be identified through synopsis. Any source who responds to the Government as a result of this synopsis will be identified to the prime contractor as a potential subcontracting possibility.

VII. Determination by the Contracting Officer that the anticipated cost to the

Government will be fair and reasonable.

The overall cost of this acquisition will be fair and reasonable to the Government. In accordance with FAR 15.403-4, the contractor will be required to provide certified cost or pricing data to be used supporting the Government’s evaluation of the proposed cost.

The proposed skill mix of labor, labor hours, types and quantities of material and other direct costs, and direct and indirect rates will be negotiated by the government based on recommendations from the Defense Contract Management Agency (DCMA) and expert technical personnel supporting the program. The contract price will be negotiated in accordance with the procedures in FAR Part 15. Based on the foregoing, the Contracting Officer will determine the anticipated cost to the Government to be fair and reasonable.

VIII. Description of the market research conducted and the results, or a statement of the reasons market research was not conducted.

Market Research, conducted September 2021, included Sole Source Synopsis (SSS), previewing the results of recent market research undertaken to meet similar or identical requirements, and Internet searches. The results of Market Research efforts and Vendor Survey, below, indicate that no commercial product exists and no sources were found that possess the expertise, capabilities, and experience to perform production and sustainment which could meet these requirements.

A Sole Source Synopsis (SSS) was posted to www.beta.sam.gov on date of 4 February 2021 under notice SPRWA1-23-R-JHMCS. The SSS requested responses from interested vendors that possess the expertise, capabilities, and experience to meet qualification requirements for this effort. One vendor other than CEVS responded to SSS.

Thales Defense wanted to introduce new innovations. Senior manager from Thales Defense emailed and expressed his willingness to discuss this SSS with the Government.

The 407 SCMS/GUEAE engineer held telecom with Thales representative and discussed this matter in detail. Thales provided information for the alternate system that is current JHMCS replacement and being utilized on USAF platforms such as F-16 and A-10.

Thales confirmed that as the SSS is written specifically for the NSNs listed on the website, Thales Defense does not possess technical data to bid on this SSS. Thales provided multiple presentations of the Thales developed helmet system. This information was forwarded to the squadron director for her review and further distribution. Inquiry from Thales Defense does not count as potential source for the existing NSNs posted on the SAM website as this is a completely different system.

The Government does not possess a technical data package to support a competitive award, nor does the Government have the capability to independently validate the operational capability of end item repairs. The only known approved vendor is Collins Elbit Vision System, LLC.

Internet searches and queries were performed using search engines including www.google.com, www.Thomasnet.gov and www.beta.sam.gov. Results returned specific to JHMCS, its part numbers, NSNs and component nomenclatures identified only CEVS as the vendor. North American Industry Classification System (NAICS) code searches were pursued for potential opportunities in small business 8(A), HUB Zone, and Certified Disadvantaged companies. Numerous Market Research efforts have been conducted over the past years to determine any other potential sources for many of the items listed, but due to lack of technical data, no other sources have been found.

Additionally due to the large number of items included in this contract, re-design of any item is considered to be uneconomical and would result in excessive delays and increased costs to the program.

The Small Business Administration (SBA) website provided a Dynamic Small Business Search using NAICS code 811219, and keyword "helmet" was searched in an effort to find small businesses that may be able to repair this item. NAICS code 334511 and keyword “helmet” was searched in an effort to find small businesses that may be able to produce this item. While there were numerous results, there are no known companies that have the technical data to complete repairs and manufacturing of this item. Only the original equipment manufacturer, CEVS, has the complete data package needed to repair and manufacture this item.

The operational requirements of the JHMCS system are militarily unique and used on the F-15, F-16 and F-18 aircrafts. There is no commercially available or equivalent system and no opportunity to customize or modify a commercial asset.

IX. Any other facts supporting the use of Other Than Full and Open Competition.

JHMCS is currently in production and repair at CEVS and the Government has not acquired reprocurement level data necessary to support manufacture or repair of the system. All support equipment needed to produce the JHMCS spares is currently located at CEVS. Therefore, the primary barrier to commercial competition is the lack of a technical data package.

X. List of any sources that expressed, in writing, an interest in the acquisition.

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 or services required.

Efforts to obtain data rights and discount CEVS’s limited and proprietary rights assertions have been unsuccessful. Previously, the JHMCS team sought legal recourse to acquire this data, but the Judge Advocate General (JAG) advised a successful challenge of CEVS’s assertion of ownership of the data is high risk and poses a severe threat to timely program execution.

The 407 SCMS Logistics Management Specialist at WR-ALC made requests to the contractor in July of 2019 for a cost of the data to repair JHMCS. On 28 Aug 2019, both OEMs, Collins and Elbit Systems Limited (ESL), declined to provide any further data rights. On March 25, 2021 the 407 SCMS made another request to contractor for repair data. On 23 May 2021, CEVS responded to request and declined to sell their proprietary data associated with the JHMCS product line. The JHMCS team was therefore unable to resolve the issue and relinquished their pursuit of acquiring the data.

Therefore, without data availability, no action will be taken to remove barriers to competition. However, DLA Aviation will continue to synopsize future requirements to allow industry the opportunity to identify competitive items. Any items that subsequently become competitive after award will be removed from the contract.

The plan to break barriers to competition in the prior J&A was to continue engaging the OEM on selling the TDP to the Government. That plan was completed, however the OEM continues to decline sell of the TDP to the Government. Based on fulfillment of the prior plan, the current J&A does not require higher level approval in accordance with DFARS PGI 206.304(a) (S-70)

XII. Certification by the Contracting Officer.

As evidenced by my signature on the Coordination and Approval Document (CAD), I have determined this document to be both accurate and complete to the best of my knowledge and belief.

XIII. Certification by the technical/requirements personnel.

As evidenced by my (our) signature(s) on the CAD, I (we) certify that any supporting data contained herein, which is my (our) responsibility, is both accurate and complete.

Attachment 1: JHMCS Tables for Repair and Production