Tab 2_JA_NAS JAX_Bridge_signed_redacted_Redacted.pdf

DEFENSE LOGISTICS AGENCY

ENERGY

8725 JOHN J. KINGMAN ROAD

FORT BELVOIR, VIRGINIA 22060-6221

J&A Tracking Number 26-0031

Justification for Other than Full and Open Competition Bulk Fuel Services at Naval Air Station (NAS) Jacksonville, FL

1. Summary/Introduction:

The Defense Logistics Agency (DLA) Energy, a major subordinate command of DLA, is the contracting activity for bulk petroleum products and services for the Department of War (DoW).

This justification & approval (J&A) is for the award of a three-month bridge action with a three-month option extension by modification on contract SPE600-15-C-5000 for alongside aircraft refueling and fuel storage services in Jacksonville, Florida. The original contract, SPE600-15-C- 5000, was competitively awarded on November 28, 2014 as a five-year base period from June 1, 2015 to May 31, 2020, plus a five-year option period, and a six-month extension provision. The extension provision under Federal Acquisition Regulation (FAR) 52.217-8, Option to Extend Services, was exercised under P00036 of the current contract. A three-month bridge extended the contract from December 1, 2025 to February 28, 2026. The three-month option was exercised via modification P00042 with the current period of performance expiring on May 31, 2026. This bridge action justification will result in a contract modification that will require the contractor, United Paradyne Corporation (UPC) to continue providing bulk storage services, alongside aircraft refueling services, and the entire fuels management services, as the only responsible source that can satisfy the agency requirements under the authority found at FAR 6.103- 1(c)(2)(i) and (ii). This includes services to provide safe, accurate and timely handling, quality control, and accountability of Defense Working Capital Fund-owned petroleum products and to perform required maintenance to ensure facilities, associated systems, vehicles, and equipment remain operational to meet the U.S. Navy’s mission.

The new performance period will begin June 1, 2026 through August 31, 2026, with a three-month option to extend the contract through November 30, 2026. The total value of this bridge action is $1,387,493.94, which would increase the contract value from

This action constitutes a bridge action by contract modification under DLAD 17.9601(a).

2. Nature and/or description of the action being approved (FAR 6.104-1(a)(2)):

The bridge by modification of these services for three months with one three-month option, is being conducted using procedures under FAR 6.103-1(b), Only One Responsible Source.

Awarding a contract to a new source would result in substantial duplication of costs to the Government, this is not expected to be recovered through competition and would result in unacceptable delays in fulfilling the agency’s requirements. The services sought are highly specialized and available only from the incumbent while a full and open competitive follow-on is solicited. The incumbent is already providing these services, and transitioning to a new contractor would risk a break in service that could disrupt the mission. The incumbent has the

Justification for Other Than Full and Open Competition (Cont’d)

SPE600-15-C-5000 – UNITED PARADYNE CORPORATION (UPC)

3. Description of supplies or services required to meet the agency’s need (including estimated value) (FAR 6.104-1(a)(3)):

The current contract, SPE600-15-C-5000, was competitively awarded to UPC on November 28, 2014 at a total contract value of $18,229,159.40. This second bridge action by contract modification will extend the period of performance to August 31, 2026, with one three-month option period extending through November 30, 2026, to provide bulk storage services, alongside aircraft refueling services, and fuels management services to meet the U.S. Navy’s mission.

4. Identification of the statutory authority permitting other than full and open competition (FAR 6.104-1(a)(4)):

This J&A is based upon the authority of 10 U.S.C. §3204(a)(1), as implemented by FAR 6.103- 1(b) – Only One Responsible Source, and more specifically, the authority of FAR 6.103-1(c)(2).

The services sought are highly specialized and available only from the original source for this follow-on contract. Award to a new source would likely result in substantial duplication of cost to the Government, this is not expected to be recovered through competition and would result in unacceptable delays in fulfilling the agency’s requirements.

5. Demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires using the authority cited (FAR 6.104-1(a)(5)):

The mission at NAS Jacksonville is dependent upon the current fuel services provided by the incumbent contractor, UPC. The customer requires continuous, high quality bulk storage services and fuels management services. Timely fuel support, system maintenance, and quality control IAW U.S. Navy standards are required to meet the mission. The incumbent is already providing these services, and transitioning to a new contractor would risk a break in service that could disrupt the mission. The incumbent has the necessary workforce and infrastructure in place, with the personnel already trained and prepared to handle the operations. A new contractor would face significant delays in acquiring the necessary infrastructure, permits, and training personnel, which would lead to a gap in services. Awarding this contract to any source other than the incumbent, UPC, would create an unacceptable risk of mission failure due to a critical gap in service delivery.

Due to the above, the services required are available only from UPC to satisfy the Agency’s requirements without any crippling delays. The mission at NAS Jacksonville is dependent upon the current fuel services provided by the incumbent contractor (UPC), including timely fuel support, system maintenance, and quality control in accordance U.S. Navy standards. The existing workforce is trained and ready to conduct operations without interruption. UPC currently possesses all necessary equipment, knowledge of environmental issues, and personnel to sustain services; thus, making them the only viable source to ensure the continuity of services.

Alternative vendors are unable to assume operational responsibilities without a disruption in service continuity.

Justification for Other Than Full and Open Competition (Cont’d)

SPE600-15-C-5000 – UNITED PARADYNE CORPORATION (UPC)

During a standard competitive transition, duplication of effort and overlap are carefully scheduled to ensure continuous mission support. A break in service, however, offers no such buffer. The strategic cost of paralyzing a major continental U.S. fuel node compromises national defense readiness and regional energy security. Therefore, the immediate operational risk of this specific service disruption far outweighs the potential cost savings we originally sought through the competitive award.

The cost for the current contract is approximately $2,774,987.88 per year. Cost to the Government would be duplicated if another contractor provided the service instead of moving forward with a bridge contract. The total estimated duplicated costs are $338,700 which includes costs for Administrative, Insurance, maintenance, personal protective equipment, and personnel training.

Based on the solicitation, key areas where costs could be duplicated include:

• Administration/Operations: The cost is approximately $50,000.

• Insurance: Liability insurance is approximately $35,700.00.

• Maintenance/Parts: The cost is approximately $50,000.

• Permitting and Licensing: Obtaining necessary permits and licenses (environmental, safety, operational) is time-consuming and costs around $100,000 in fees, studies, and legal consultations. This is a one-time cost.

• Personal Protective Equipment (PPE): Costs range between $2,000 - $5,000.

• Personnel Training: Training a new workforce to U.S. Navy standards is expensive (fuel handling procedures, safety protocols, quality control). Training, including classroom instruction, on-the-job training, and certifications, could cost $5,000 per employee. Training for an estimated 20 employees would cost approximately $100,000.

The incumbent's workforce is already trained.

• Vehicle Procurement: While the new solicitation requires the awardee to obtain vehicles, this is required for the new contract and does not apply to duplicated costs.

Total Estimated Duplicated Costs:

Adding the estimates together:

$50,000 (Administrative) + $35,700 (Insurance) + $50,000 (Maintenance) + $100,000 (Permitting) + $3,000 (PPE) + $100,000 (Training) = $338,700

How the Estimate Was Derived:

Estimates were reached through market research, reviewing the Independent Government Cost Estimate (IGCE) provided by the program manager, and reviewing data from Florida Department of Environmental Protection (FDEP), City of Jacksonville, FL, Florida Statutes, and Florida Administrative Code (Underground and Aboveground Storage Tank Systems).

Awarding this contract to any source other than the incumbent, UPC, would create an unacceptable risk of mission failure due to a critical gap in service delivery. Furthermore,