JA_-_W56HZV-15-C-0230.pdf

CMO Control Number: 2015-135

DEPARTMENT OF THE ARMY

Justification and Approval for Other Than Full and

Open Competition

1. Contracting Activity: The United States Army Contracting Command-Warren (ACC- WRN) is the contracting activity for the proposed action.

2. Description of Action: ACC-WRN proposes to award a new sole-source firm-fixed price (FFP) contract to Meggitt Training Systems, Inc. (MTSI) for targetry devices. The Government projects the contract award in the 4th Quarter of FY15 and will obligate FY15 Operations and Maintenance, Army (OMA) funds for the effort.

3. Description of the Supply or Service Purchased: Yakima Training Center (YTC), WA has a requirement to upgrade Radio Frequency (RF) targetry devices at five of its ranges with new RF targetry devices. The estimated value of this action is $3,725,365.00.

YTC is in need of the RF targetry devices listed in Table 1.

Table 1 – Current Requirement

Qty Item

50 Stationary Infantry Targets (SITs)

158 Stationary Armor Targets (SATs)

11 Moving Armor Targets (MATs)

10 Hand Held Controllers (HHCs)

1 Shipping

1 Travel

1 Refresher Training

4. Authority Cited: The statutory authority permitting other than full and open competition is 10 USC 2304(c)(1), as implemented by Federal Acquisition Regulation (FAR) 6.302-1, “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.” FAR 6.302-1(a)(2)(ii)(A) provides that highly specialized supplies may be deemed to be available only from the original source when it is likely that 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.

5. Reason for Authority Cited: The Government does not own or have rights to the technical data that can be used to competitively procure targetry devices to fit the needs of YTC’s requirement. A Government-owned competitive technical data package (TDP) for these targetry components does not exist and MTSI informed the Government on 24 June 2015 that the TDP information was not for sale.

The Army Targetry Systems (ATS) contracts (DAAE20-02-D-0021 and W56HZV-11-D- 0146 through 11-D-0150), which have been used to procure similar targetry by way of performance specifications, have been Multiple Award Indefinite Delivery, Indefinite Quantity (MA IDIQ) contracts, with the current iteration of the program known as “ATS II”. Under ATS MA IDIQ contracts, each contractor uses their own proprietary Very High Frequency (VHF) RF communication scheme to communicate between their own proprietary software in the controller and the firmware programmed into each downrange target device. Therefore, no other contractor’s equipment or software is compatible with another contractor’s software/firmware within their system of targetry devices.

YTC has existing MTSI targetry and older, legacy targetry that YTC has upgraded over the years to work as a system with existing MTSI controllers via MTSI’s proprietary Radio Frequency (RF) communication protocol. Since the targetry devices currently installed on the YTC ranges are from MTSI or are compatible with MTSI software/firmware, in order to compete this requirement, the Government would have to replace the entire range. Competing the requirement would require the Government to procure the targetry devices listed in Table 1, plus targetry devices to replace the MTSI/MTSI-compatible targetry devices that YTC already has.

The following is an estimated valuation of the existing targetry that would have to be replaced at YTC if the requirement were competed:

• 6 Hand Held Controllers (HHCs) – The HHCs are MTSI RZ4 controllers (Part No.

RZ4-2400) and can be bought through the General Services Administration (GSA) for $4,095 each for a total of $24,570.

• 78 Stationary Infantry Targets (SITs) – The MTSI SITs (GSA Part No. AA8) are $2,811 each for a total of $219,258.

• 24 Moving Infantry Targets (MITs) – The MTSI MIT (GSA Part No. DP26-AC-RF- R) are $18,750 each for a total of $450,000.

• 140 Stationary Armor Targets (SATs) – The SATs are a mix of REmoted Target Systems (RETS) and GSA. Four of the SATs are MTSI SATs procured off GSA (GSA Part No. AA25-DC) at $9,472 each. The rest are all a form of RETS SATs. Since these are 15-30 years old, but have had some upgrade work done and are still working, the estimated value of each of these is 50% the cost of a new ATS II SAT. Therefore the approximately 136 SATs remaining have an estimated value of $6,796.25 each. The total SAT Price is $962,178.

Adding the totals of the bulleted items listed above gives an overall value of $1,656,006 for the targetry devices that would have to be replaced at YTC if the requirement were competed.

Table 2 compares the estimated cost of awarding a sole-source contract to MTSI for the RF targetry devices currently required versus the estimated cost to compete the current requirement and replace MTSI targetry devices that are currently located at YTC. The quantities on the right side of the table include the current quantity requirements plus the quantities that would need to be replaced. The unit and total prices on the right side of the table were calculated by averaging three other ATS II prime contractor’s ceiling prices. As Table 2 shows, the estimated cost to compete the requirement would be $6,063,457.87 versus issuing a sole source contract to MTSI for approximately $3,725,365.00. This difference in cost is not expected to be recovered through competition, especially since the majority of the cost difference would be for replacing existing targetry that still has functionality.

Table 2 – Sole Source vs. Competitive

CLIN Noun QTY Est. MTSI Cost

QTY

ATS II, S Ordering Period 5, QTY Break Price

Avg. Est. Cost of Saab, SSI, and Lockheed

Unit Price Total Price Unit Price Total Price

0001AB RF SIT 50 $4,345.00 $217,250.00 128 $4,615.33 $590,762.67

0003AB RF MIT 0 $0.00 $0.00 24 $22,600.47 $542,411.36

0004AB RF SAT 158 $13,592.50 $2,147,615.00 158 $10,372.05 $1,638,783.90

0007AB

RF RETS

Upgrade

MAT

11 $110,000.00 $1,210,000.00 11 $122,997.83 $1,352,976.13

0010AA Direct HHC 10 $11,700.00 $117,000.00 16 $15,563.61 $249,017.81

Shipping Costs

1 $20,000.00 1 $20,000.00

0034 Training 1 $10,000.00 1 $10,000.00

0035 Travel 1 $3,500.00 1 $3,500.00

Total Cost of Range $3,725,365.00 $4,407,451.87

Existing Targetry* 1,656,006.00

Total $6,063,457.87

*This is the estimated valuation of the existing targetry that would have to be replaced at YTC as explained above.

6. Efforts to Obtain Competition:

a. Effective Competition: This effort will not be competed due to the reasons stated in Section 5.

b. Subcontracting Competition: Since MTSI is considered a large business, a subcontracting plan is required and clauses 52.219-9 and 52.219-4004 will be included.

7. Actions to Increase Competition: This is intended to be a one-time requirement to upgrade existing RF targetry devices on the associated YTC ranges. The targetry devices were previously configured by MTSI to work with their proprietary control software and targetry device firmware. Future requirements for newly constructed YTC ranges will be competed among the current ATS II MA IDIQ prime contractors.

Contracts for new, future ranges at YTC will be able to be competed because there won’t be existing targetry to interface with on the newly constructed ranges.

8. Market Research: MTSI and ZelTech Training Solutions (ZelTech) responded to a Pre-Solicitation Market survey (W56HZV-15-R-0226) on 6 July 2015. Zeltech proposed options for the Government to buy all new targetry, but did not propose they could interface with the existing MTSI targetry devices and their proprietary software/firmware.

MTSI confirmed they are the only contractor that can provide targetry and controllers that interface with the existing targetry and controllers that include MTSI’s proprietary software/firmware. Therefore, competitive efforts would result in having to buy more targetry than would be needed from a sole source to MTSI, and also would result in additional costs to YTC and wasted efforts by YTC to upgrade these ranges to date.

9. Interested Sources: The notices required by FAR 5.201 will be published and proposals received will be considered. To date, no interested sources have provided evidence of the capability to interface with a MTSI’s proprietary software.

10. Other Facts:

a. Procurement History:

Recent YTC Projects:

i. Contract: W56HZV-11-D-0148 / 0030 (ATS II) Award Date: 13 August 2014 Price: $1,030,744 Contractor: Meggitt Training Systems, Inc. (MTSI) Competitive Status: Fair Opportunity Reason for Competitive Status: This was a newly constructed range without the requirements to interface with existing proprietary equipment.

Range Type: Convoy Live Fire Range (CLFR)

ii. Contract: DAAE20-02-D-0021 / BR05

Award Date: 20 September 2010 Price: $294,600 Contractor: Meggitt Training Systems, Inc. (MTSI) Competitive Status: Sole Source per FAR 16.505(b)(2)(ii) (Targetry that interfaced with existing MTSI targetry that is unique or highly specialized) Reason for Competitive Status: This was a procurement that occurred for similar reasons to this one.

Range Type: 20 - Radio Frequency SATs, 4 – HHCs

b. Other facts. None

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

Typed Name: Loren Morse Date: 23 JUL 2015 Title: Branch Chief Signature: //s// Loren L Morse

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

Typed Name: Fred Matchem Date: 24 July 24, 2015 Title: Group Leader Signature: //s// Fred Matchem

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable. This action will be negotiated with MTSI using the contractor’s certified cost and pricing data and detailed cost and pricing evaluations, as deemed necessary. Fairness and reasonableness determination will be based on evaluation and negotiation of the contractor-submitted proposal and history.

Typed Name: Corey Richards Date: 27 July 2015 Title: Contracting Officer Signature: //s// Corey Richards

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

Typed Name: Corey Richards Date: 27 July 2015 Title: Contracting Officer Signature: //s// Corey Richards

APPROVAL

Based on the foregoing justification, I hereby approve the procurement of the RF targetry to upgrade the five existing/legacy ranges at YTC, WA on an other than full and open basis pursuant to the authority of 10 U.S.C.2304(c), as implemented by FAR 6.302-1(a)(2), “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.” This effort is subject to availability of funds, and provided that the services and property herein described have otherwise been authorized for acquisition. The total value of this acquisition is $3.7M.

7/27/2015

X LaRuth Shepherd

LaRuth Shepherd

Competition Advocate

Signed by: SHEPHERD.LARUTH.1230673116