SUV Lease SSJ.docx

JUSTIFICATION FOR SOLE SOURCE (Simplified Acquisitions <$250K)

The service or material listed on H9126927058 is sole source and competition is precluded for reasons indicated below. There are no substitutes available for this material or service.

Restricted to the following source.

Company: District Fleet, LLC (CAGE: 7RBR7)

POC: Daniel MacDonald

Phone Number: (202)257-3797

Company address: 13724 Pryor Rd., Thurmont, MD 21788

Description of the item or service required, the estimated cost, and required delivery date.

As the Nation's highest-ranking military officer, the Chairman Joint Chiefs of Staff (CJCS) and the Vice Chairman Joint Chiefs of Staff (VCJCS) are identified as high-risk personnel (HRP) and require qualified personnel and equipment to perform full-time protection. The Field Manual (FM) 3-19.12, Protective Services, dated August 2004, Motorcade Operations and Technical Driving, 9-1 stipulates automotive resources must be available in enough quantity to meet all protective needs of HRP. There should be enough vehicles to transport all members of the official party, the Protective Service Detail (PSD), and the baggage team. Standard Vehicles 9-2 stipulates the backup vehicle in cases of emergency must be of equal stature to the “principals” primary vehicle. A full size, four-door, all-wheel drive (AWD) Sport Utility Vehicle (SUV) is the standard vehicle used as the CJCS backup vehicle. The functionality of the SUV is required to meet the day-to-day force protection requirements and must be able to be equipped with lights, sirens, and encrypted communication equipment.

As a result of the above, the Joint Staff requires the lease of three (3) dark color, four door, full size, AWD, SUVs. The SUVs shall be equipped with a V-8 gasoline engine and black leather seats with ample room to accommodate all anticipated passengers without crowding (Captain’s chairs second row seating). The SUVs also need to have third row seating, onboard navigation, backup cameras, four sets of keys, and shall be capable of maintaining high speeds with sufficient power to cruise easily on all kinds of roads. All three SUVs shall be the same make and model, and be identical in all aspects (features, and accessories). The contractor is also required to perform regular maintenance on the vehicles including oil changes, rotation of tires, etc. and provide licensing and registration for the vehicles. The vehicles are required by 22 June 2022 and are required for a full year through 21 June 2023. The estimated cost is $34,272.00.

This requirement is a follow-on to contract N00189-21-P-Z206 with District Fleet, LLC, which was solicited and awarded to the contractor on a sole source basis, and N00189-21-P-Z206 was a follow-on to N00189-18-P-Z315, which was a three-year contract (3-year lease consisting of a base year and two, one-year options) which resulted from a competitive solicitation process. Although the requirement was competed back in FY18, the Government had no option but to award the follow-on requirement directly to District Fleet, LLC due to the impacts of the COVID-19 pandemic on the supply of raw materials and, consequently, automobiles. In short, the global spread of COVID-19 has affected the global economy and supply chains in ways not seen since the SARS outbreak in 2003. The declines in demand during the initial outbreak of the pandemic caused many suppliers of raw materials to reduce capacity, which has resulted in higher prices and limited supply of many raw materials, to include steel and microchips used in production of automobiles. This led to a substantial cut in vehicles produced during 2021. Additionally, the majority of car manufacturing plants shutdown between June and July of any given year to begin refitting and adding new equipment necessary to produce the upcoming year’s vehicle model. Because of the manufacturing facilities that are scheduled to close in the coming month and the significant impact of COVID-19 on the supply of vehicles, dealerships need to order vehicles up to 6-months in advance and, even then, they cannot guarantee when they will have the vehicles in stock due to the volatility of the market. As a result, the Joint Staff reconsidered their requirement and determined it was in their best interest to accept vehicle models older than 2021 as long as the vehicles still met all of the aforementioned requirements. Ultimately, market research revealed that no dealership was capable of providing 2021 or 2022 models of SUVs meeting the Joint Staff’s requirement by 22 June 2021, and contract N00189-21-P-Z206 was awarded to District Fleet to lease the 2018 models of SUVs for an additional year, in anticipation that the supply chain for automobiles and automobile market would return to a state of normalcy by 2022.

In the beginning of 2022, the Joint Staff and FLC Philadelphia Contract Specialist conducted market research for this follow-on lease requirement and it was determined that the problematic market conditions from 2021 continued into 2022, and it was already too late to process a competitive follow-on requirement since no dealership would be able to provide the Joint Staff with three identical SUVs of the newest, 2022 model by the required date of 22 June 2022. The problems caused by the market conditions were also compounded by the delayed approval of the FY 22 Appropriations Act, which wasn’t approved until 15 March 2022. Due to the delayed approval, the Joint Staff did not have the necessary funds to begin processing the follow-on requirement earlier in the fiscal year, since a purchase order would have needed to be issued back in November or December or 2021 to ensure a dealership would have the vehicles in stock and ready for lease by June 2022.

Specific characteristics of the material or service that limit the availability to a sole source (unique features, function of the item, etc.). Describe in detail why only this suggested source can furnish the requirements to the exclusion of other sources.

Considering no dealership can provide the newest available model of an SUV meeting the Joint Staff’s requirement by the required start date, the next best and only alternative is to continue leasing the current 2018 SUVs provided District Fleet. No other car dealership that was identified through market research can provide three identical SUVs meeting the Joint Staff requirements by 22 June 2022. Additionally, leasing older vehicles has inherent risk in that the performance of vehicles can be compromised over time through lack of proper maintenance, heavy usage, or accidental damage. Consequently, even if a dealership that was undiscovered during market research could provide three identical, older model SUVs, there is an unacceptable level of risk associated with the history of the vehicles. For example, older vehicles could have been in prior accidents or have excessive mileage which would require replacement of essential components (belts and engine parts) outside of the scope of routine maintenance in order to meet the Joint Staff’s reliability standards. This risk is entirely negated through the continued lease of the vehicles provided by District Fleet which are 2018 models, were provided to the Joint Staff in “new” condition under prior contract N00189-18-P-Z315, have been in the Joint Staff’s possession since, and have been continuously maintained.

As a result, when considering the lack of vehicle supply and risks associated with leasing older vehicles, the only contractor capable of meeting the Joint Staff’s requirement is District Fleet through the continued provision of the SUVs previously provided under contracts N00189-18-P-Z315 and N00189-21-P-Z206.

Other information to support a sole source buy:

It is intended to lease the three SUVs currently provided by District Fleet under contract N00189-21-P-Z206 for one additional year, from 22 June 2022 to 21 June 2023. During this lease period the market will be constantly monitored to determine if and when the lease of a new SUV model is a viable strategy to meet the Joint Staff needs beginning 22 June 2023. At the earliest feasible moment, a requirement will be processed to begin the procurement (lease) or three newer modeled SUV’s with the intent of awarding a contract with an abundance of lead-time, approximately six-months, allowing any dealership more than ample time to place any necessary orders for new SUVs.

Additionally, awarding this requirement to District Fleet also supports the Navy’s small business targets, as District Fleet is a HUBZone certified small business.

I CERTIFY THAT STATEMENTS CHECKED, AND INFORMATION PROVIDED ABOVE, ARE COMPLETE AND CORRECT TO THE BEST OF MY KNOWLEDGE. I UNDERSTAND THAT THE PROCESSING OF THIS SOLE SOURCE JUSTIFICATION PRECLUDES THE USE OF FULL AND OPEN COMPETITION.

Signature _____________________________ Title: _______________________

Activity ______________________________ Date ____________________________

Contracting Officer Signature _________________________________________

Date ________________________________ SAP Sole Source

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