J A.pdf

Control Number: 08-1008

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity: U.S. Army Contracting Command, Aberdeen Proving Ground

Contracting Office 6001 Combat Drive Aberdeen Proving Ground, Maryland 21005

2. Description of Action: The action is for the award of a five-year, Firm-Fixed-Price/Time and Materials, Indefinite Delivery Indefinite Quantity contract for up to $250M of AN/PYQ-10 Simple Key Loaders (SKLs), spare parts, and depot and engineering support. Other Procurement, Army appropriations and other Service funds will be utilized for this effort.

3. Description of Supplies/Services: The SKL is a ruggedized, hand-held, Personal Digital Assistant Device that is utilized by the Army, Navy and Air Force as a key component of the National Security Agency’s (NSA’s) Electronic Key Management System. The SKL is used to manage key materiel and was designed to be a state-of-the-art replacement for the existing AN/CYZ-10 Data Transfer Device (DTD). The SKL provides Communications Security (COMSEC) for various communications devices and networks utilized by the three Services.

The primary function of the SKL is to load a secure electronic key (Top-Secret, Secret and Confidential) into End-Cryptographic Units to enable secure communications among tactical and strategic service networks. The SKL consists of a host computer and the NSA-developed KOV- 21 Information Security (INFOSEC) Device housed in a Personal Computer Memory Card International Association Type II card. There is a critical shortfall of COMSEC key loading devices among the military services. The proposed contact will be utilized to meet requirements of the Army and other Services for SKLs, spare parts, and depot and engineering support. The total estimated value of the proposed action is $250M.

4. Authority Cited: 10 U.S.C. 2304 (c)(1) and FAR 6.302-1, Only One Responsible Source

5. Reason for Authority Cited: The proposed source is Sierra Nevada Corporation (SNC), 444 Salomon Circle, Sparks, NV 89434. SNC is the only source that has passed all of the required NSA testing, which is necessary to interface its product with the NSA-developed KOV-21 INFOSEC Device. The required testing includes Electromagnetic Interference, Telecommunications Electronics Material Protected from Emanating Spurious Transmissions and Crypto-Verification. SNC is the only source that can integrate software and hardware and verify operability, utilizing the test procedures that it developed and NSA approved. While there are other sources that develop similar systems, any source other than SNC would have to have its product undergo the same NSA required tests that SNC’s product has already undergone and passed. Developing and certifying a new product would cause delivery delays of 2-4 years and increase costs by at least $700K. Moreover, SNC can deliver SKLs with 9 months of receipt of a Delivery Order. SNC developed the SKL hardware design to interface with existing software and is currently delivering SKLs to the Army, Navy, and Air Force. SNC’s unique knowledge of the SKL’s design and embedded software enables it to produce SKLs that are backward compatible with fielded SKLs. Since the SKL will replace the DTD, which is no longer in production, any delay in delivery of SKLs will adversely affect the Global War on Terror. Units that are deployed without SKLs could experience problems with secure communications.

Therefore, failure to provide SKLs may result in increased risks of serious injury or loss of life to Warfighters.

6. Efforts to Obtain Competition: Market research was conducted, details of which are in the market research section of this document. None of these efforts have yielded additional potential sources. There is no competition anticipated for this acquisition.

7. Actions to Increase Competition: The Government will continue to monitor the marketplace to determine if any additional sources receive NSA certification for their products. If other sources receive NSA certification, then follow-on acquisitions will be competed. The Acquisition Method Reason Code for the SKL and associated spare parts is 3C because the end item and spare parts can only be acquired from a NSA-approved source in order to maintain the quality of the item.

8. Market Research: The Government’s technical experts conducted market research by publishing a sources sought Announcement on the Federal Business Opportunities (FebBizOpps) Page, on 27 November 2007. SNC was the only source that expressed interest in the proposed action. Based on this market research, the Government’s technical experts determined that only SNC can meet the Government’s requirements. Additional Market Research was conducted in October 2011 and January 2012. No other vendor has been determined to be capable of achieving required certifications without a significant impact to the Government’s mission. To date, SNC remains the only viable source for the AN/PYQ-10 SKL.

9. Interested Sources: The proposed action will be synopsized on the FedBizOpps Page in accordance with FAR 5.201. Any proposals that are received will be evaluated.

10. Other Facts:

a. Procurement History: Contract Number W15P7T-06-D-N218 was awarded on 31 August 2006 to SNC on a sole source basis, for up to $72M of SKLs, spare parts, and depot and engineering support. SNC was, and remains, the only source that possesses the required NSA certification needed to provide the SKLs. Paragraph 7 of the Justification and Approval document supporting that action stated that the Government will continue to monitor the marketplace to determine if any additional sources receive NSA certification for their products.

If other sources receive NSA certification, then follow-on acquisitions will be competed. There have been no changes that would enable competition of the proposed action.

Contract Number Award Date Contractor Extent Competed/Authority GSTO2-04-C-J0703 24 March 2004 SNC Sole Source/FAR 6.302-1 W15P7T-05-F-H433 31 August 2005 SNC Sole Source/FAR 6.302-1 W15P7T-06-D-N218 31 August 2006 SNC Sole Source/FAR 6.302-1

b. Acquisition Data Availability: The Government possesses a performance-based

Statement of Work for this effort.

c. Subcontracting Competition: FAR 52.244-5, Competition in Subcontracting will be included in the proposed contract.

11. Technical Certification: I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Rose Mary Matura Date: _______3/17/08___________________

Chief, Joint Key and Signature: ____________________________ Spectrum Management Division

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

Joseph A. Forino Date: ________3/17/08__________________

Deputy Product Manager, Network Signature: ____________________________ Operations-Current Force

13. Fair And Reasonable Cost Determination: I have determined that the anticipated price to the Government for this contract action will be fair and reasonable, based on an Independent Government Cost Estimate, cost/price analysis, audit by the Defense Contract Audit Agency and negotiations. Additionally, certified cost or pricing data will be obtained.

Ann Marie Vasconcelos Date: _________04/18/08________________

Procuring Contracting Officer Signature: ____________________________

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

Ann Marie Vasconcelos Date: _________04/18/08________________

Procuring Contracting Officer Signature: ____________________________