TAB C_DF Rev01_Consol_SUB Repair MACs_30Sep26 REDACTED_Redacted.pdf

DEPARTMENT OF NAVY

DIRECTOR SUBMARINE PROGRAMS

1333 ISAAC HULL AVE SE

WASHINGTON NAVY YARD DC 20376-0001

IN REPLY REFER TO

D&F Number: 43,190.0 Code: SUB-K122-B

DETERMINATION AND FINDINGS

AUTHORITY TO CONSOLIDATE CONTRACT REQUIREMENTS

Based on the following findings, made pursuant to 15 U.S.C. § 657q, as implemented in Federal Acquisition Regulation (FAR) 7.107-2 (Class Deviation (CD) 2026-O0020) and the Navy Marine Corps Acquisition Regulation Supplement (NMCARS) 5207.107-2, the consolidation of submarine production support requirements described herein is necessary and justified because the expected benefits to the Government, including increased quality and efficiency, a reduction in acquisition cycle times, better terms and conditions, and reduction in administrative and personnel costs, substantially exceed the benefits that would be derived from each of the alternative contracting approaches identified.

FINDINGS

Agency and Contracting Activity. Team Submarine

Nature/Description of the Action. Team Submarine intends to issue an indefinite-delivery, indefinite-quantity (IDIQ) multiple-award contract (MAC) for work to support availabilities on Ballistic Missile Submarines (SSBNs) and Guided Missile Submarines (SSGNs) at Norfolk Naval Shipyard (NNSY), Puget Sound Naval Shipyard (PSNS), Pearl Harbor Naval Shipyard (PHNSY) and Portsmouth Naval Shipyard (PNSY), both Trident Refit Facilities at Kings Bay and Bangor (TRFKB and TRFB), Naval Submarine Base New London (SUBASE New London) and Naval Base Point Loma (NBPL) to industry. These locations are referred to as the Submarine Maintenance and Repair Activities (SMRAs). An availability is a scheduled period of time when a naval vessel is taken to a SMRA for maintenance and modernization. Chief of Naval Operations (CNO) availabilities are more extensive than other maintenance availabilities and are approved by the CNO. The planned IDIQ MAC covers a range of production support requirements. The IDIQ MAC has an estimated value of $2.69 billion and has an ordering period of up to seven years, consisting of a four-year base period with three, one-year option periods.

Delivery requirements and periods of performance will be determined based on the availability schedule and will be specified in each individual order.

The proposed consolidation will not negatively impact participation opportunities available to small businesses and as described below, the IDIQ MAC will provide for small business set-aside opportunities under Lot 2 (Non-Critical) requirements.

To ensure ample opportunities for small business concerns at the delivery order-level, the Navy has categorized the requirements to be procured under the IDIQ MAC into two tiers: Lot 1 (Critical) and Lot 2 (Non-Critical), defined as follows:

Lot 1 (Critical) requirements consist of efforts that involve critical systems. Due to the nature of critical systems onboard the submarine and the likelihood that delays in

CUI

D&F Number: 42,984

Lot 2 (Non-Critical) work to be suitable for small vendors and would provide opportunities for small business participation and help bring new vendors into the submarine industrial base.

Through market research performed, eleven small businesses were assessed as capable of performing Lot 2 (Non-Critical) requirements. Therefore, as mentioned above, Lot 2 (Non- Critical) requirements will be set-aside for small businesses.

This overall acquisition strategy aligns with the industrial base strategy supported by Team Submarine program offices and senior Navy leadership. In particular, the strategy advances the Navy’s objectives of sending a strong demand signal to industry and engaging new vendors to support the ever-increasing workload associated with submarine availabilities. All pertinent information, including the industry responses to the sources sought notice, industry day events held by “Team Submarine” program offices, and Submarine Industrial Base/Maritime Industrial Base events, support the acquisition strategy as discussed herein to enhance quality and efficiency and mitigate schedule concerns, while increasing small business participation in future submarine repair, maintenance and modernization requirements.

4. Alternative Contracting Approaches. Team Submarine considered multiple alternative acquisition strategies involving less consolidation. One alternative strategy was to continue the current contracting approach for SSGNs and SSBNs of allowing the SMRAs to contract individually for these requirements using individual, SMRA specific contracts. The benefit of this approach was that it would allow for the current government resources with subject matter expertise for strategic production efforts to continue to procure products and services for their respective SMRA, keeping the pre-award functions local to each respective SMRA contracting office. While this would avoid consolidation, the Navy would not realize any of the benefits from consolidation discussed in Section 6, below.

Team Submarine also considered issuing separate IDIQ MACs for each of the seven functional areas (preservation, structural/non-destructive testing, shipboard work, electrical services, fire watch and tank watch, component repair, engineering and other technical support) for each of the SMRAs. This approach would result in fourteen separate contracts. Managing these separate contracts would result in increased administrative burden for both the Navy and industry as compared to a single consolidated IDIQ MAC that encompasses all seven functional areas across the SMRAs. The benefit of this approach is the same as mentioned above in that it would allow for the current government resources with subject matter expertise to continue to procure products and support for their respective SMRAs and keep the pre-award functions local.

As discussed above, these alternate approaches, however, result in significant disadvantages and undesirable effects for the Government. Each alternative approach would still yield significantly more administrative burden for both the Government and vendors than a single consolidated IDIQ MAC and would reduce the potential for standardization

5. Small Business Impacts and Inclusions. The proposed acquisition strategy mitigates the impact of SSGN and SSBN consolidation on small businesses since requirements previously provided under the two IDIQ MACs, two stand-alone contracts, and one single-award IDIQ

Team Submarine has considered the potential impacts of this consolidation to small businesses.

In accordance with 15 U.S.C. § 657q (c)(1)(D) and FAR 7.107-1(a)(4) (CD2026-O0020), based on the information discussed above, this consolidation will have no negative impacts to small business concerns. In accordance with 15 U.S.C. § 657q (c)(1)(E) and FAR 7.107-1(a)(5) (CD 2026-O0020), Team Submarine has ensured that steps will be taken to include small business concerns in the acquisition strategy and has encouraged it to the maximum extent practicable via small business subcontracting plans for Lot 1 (Critical) requirements and small business set-aside opportunities for Lot 2 (Non-Critical) requirements.

6. Benefits of Planned Consolidation. Team Submarine has determined that the consolidation of outsourcing requirements under an IDIQ MAC will provide specifically identified benefits to the Government that substantially exceed the benefits that would be derived from each of the alternative contracting approaches identified above, as discussed herein:

a. Quality/Efficiency: The use of a consolidated IDIQ MAC for outsourcing production work requirements will significantly reduce inconsistencies and variability associated with the current use of separate, individual contracts awarded and managed by different SMRAs. Upon award of the contract, the Navy will be able to coordinate across the SMRAs to implement a strategic sourcing approach that will issue orders under this contract with the goal of appropriate work prioritization. In addition, this consolidation effort will make available Navy resources that would have otherwise been tied up in non-consolidated efforts, allowing those resources to focus on executing other future Navy contract requirements. In contrast, the current approach for SSGNs and SSBNs of soliciting and awarding separate contracts at each individual SMRA is inefficient. Continuing this approach would lead to higher contract costs, delays in meeting milestones and schedules and quality control redundancies. Additionally, this consolidation approach aligns the overall effort under a single leadership team, eliminating the inefficient management overhead associated with the previous approach of disparate contracts, and allowing the rest of the team to remain focused on delivery goals. The planned acquisition ensures that combat ready submarines are available for unrestricted operational tasking. To increase SMRA throughput, this strategic approach to private industry support will help (1) focus SMRA resources to improve efficiency, drive down durations, and reduce idle time; and (2) expand repair and maintenance capacity across the Submarine Industrial Base. This effort will help prevent availability execution delays by more than 1,000 days that have historically led to costly delays and loss of submarine operational availability. The Submarine Force has historically faced severe operational availability shortfalls, largely driven by multi-year maintenance backlogs at the SMRAs. To recover fleet readiness and eliminate systemic delays, the Navy must transition from localized, ad-hoc contract actions to a consolidated, enterprise-wide IDIQ MAC vehicle.

This strategic consolidation serves as a single, centralized contract vehicle hosting over 20 pre-cleared contractors. By standardizing terms, expanding the industrial base, and streamlining the acquisition lifecycle, this consolidated approach directly targets and mitigates the capacity, labor, supply chain, and administrative bottlenecks that have traditionally degraded SMRA execution timelines. Consolidation acts as a force multiplier to accelerate repair execution through centralizing all submarine repair opportunities within one vehicle allowing the industrial base to plan their capacity more strategically. Instead of monitoring administrative portals for separate announcements, vendors can focus their resources on delivering high-quality, technically sound proposals for geographically diverse RFPs. This leads to more competitive bidding and better-aligned execution plans. Additionally, consolidating all submarine repair tasking under a single program office enables unprecedented data collection for first time, SMRAs can easily compare historical actuals across the entire enterprise. This centralized repository of cost and schedule data informs future negotiations, ensures fair and reasonable pricing, and prevents schedule overruns by identifying performance trends early.

These submarines are in particularly high demand by combatant commanders and eliminating delays to improve availability duration and increase operational readiness of the submarine force is vital to national defense. The proposed Team Submarine strategy represents a reasonable approach to cover the anticipated increase in demand for availability of submarines and helps eliminate resultant schedule delays that reduce submarine operational availability and efficiency.

This will result in improved infrastructure interoperability, elimination of support interruptions, and centralized management of requirements.

b. Acquisition Cycle: Consolidating requirements into a single IDIQ MAC would result in significant reductions in acquisition cycle time of up to twelve months. The basis for this projected acquisition cycle time savings was developed from historical information related to the actual acquisition timelines associated with previously awarded IDIQ MAC efforts. Historically, the competitive award process required a minimum of 18 months from the start of planning to contract execution, and providing a consolidated approach will allow for the award of delivery orders within six months. As a result, this consolidation will eliminate the need for each SMRA to execute the full acquisition cycle (e.g., develop and issue solicitations, conduct evaluations and negotiations, and award individual contracts) for each requirement. This new, consolidated approach allows the contracting officer to issue delivery orders against the IDIQ MAC and provides the ability for the contracting officer to be even more forward-facing and responsive to customer requirements because all the requirements under this contract will come through one centralized point of contact to address the appropriate prioritization of work.

By utilizing pre-cleared contractors under a single master contract, SMRAs bypass the lengthy, public-facing solicitation process on sam.gov for each individual repair effort. Request for Proposals can be issued, evaluated, and awarded rapidly within the established IDIQ MAC pool, cutting procurement lead times from months to weeks.

c. Terms and Conditions: The use of a single IDIQ MAC would eliminate the need to negotiate terms and conditions for separate contracts. This in turn would streamline and standardize terms and conditions, thereby reducing the burden of managing contractors against differing requirements and ensuring that contractors are not held to disparate standards across similar requirements. This baseline eliminates localized negotiation friction, simplifies contract administration, and facilitates seamless, standardized communication between Headquarters (HQ) and local SMRAs.