REDACTED_J A-_RESET_of_FWTRD_and_TDRT_-ACC-WRN-17-2079.pdf

CMO Control # 2016-084

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

1. Contracting Activity: Army Contracting Command - Warren (ACC-WRN) is the contracting agency for this action.

2. Description of Action: This action is for the procurement to RESET up to ninety

(90) Fifth Wheel Towing Recovery Devices (FWTRD) and the RESET of up to ninety

(90) Tilt Deck Recovery Trailers (TDRT), key components of the Modular-Catastrophic Recovery System (MCRS) from Tru-Hitch, Inc., Pleasant Valley, CT. ACC-WRN proposes to award a new two year Indefinite Delivery Indefinite Quantity (IDIQ) contract utilizing Fiscal Year (FY) 16 and anticipated FY17 Operation and Maintenance, Army (OMA) Overseas Contingency Operation (OCO) funds. The total estimated amount of this action is $6,300,000.

3. Description of Supplies or Services: This procurement will provide for the RESET of the FWTRDs and TDRTs to be restored to fully mission capable operability, which shall include the following:

RESET of FWTRD, includes disassembling to stage one (1) production configuration, sandblast all painted surfaces as original production, prep, prime and paint to original specifications, and inspect, reassemble and replace any damaged or deficient parts.

RESET of TDRT, includes inspection and replacement of necessary consumable parts, to include the removal of axle assembly for inspection of the slide pads and rubber air hoses; replacement of the air lift and level bags; removal and replacement of 13 tires per system; repacking wheel bearings and seal replacement; removal of all side extension drawers; removal of 102 retaining bolts to clean, re-lubricate and re-install; touch up paint in reworked areas; and inspect and re-pack Basic Issue Items (BII) as needed.

The RESET of these systems will enable units to recover and evacuate Stryker, Mine Resistant Ambush Protected (MRAP) and Tactical Wheeled Vehicles up to 35 tons.

The MCRS is an approved Program of Record which enables Commanders to have organic equipment required to complete missions without the need for contractor or improper utilization of Heavy Equipment Transporter System and M88A2 Hercules Recovery Vehicle, which is cost prohibitive and .

4. Authority Cited: The statutory authority permitting other than full and open competition is Title 10 U.S.C. 2304(c)(1) as implemented by Federal Acquisition Regulation (FAR) 6.302-1(a)(2)(iii)(A) and (B) “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.” FAR 6.302-1(a)(2)(A) states “substantial duplication of cost to the Government that is not expected to be

Operations Security Information (OPSEC) recovered through competition” and FAR 6.302-1(a)(2)(B) states “unacceptable delays in fulfilling the agency’s requirements.”

5. Reason for Authority Cited:

a. Duplication of Cost:

1. Tru-Hitch is the developer and sole manufacturer of the MCRS, inclusive of the FWTRD and TDRT. The Government did not purchase and does not possess the Technical Data Package (TDP) for the MCRS. Tru-Hitch is the only source possessing the TDP containing proprietary data and drawings required to provide parts for the MCRS. Since Tru-Hitch holds the patent for the MCRS, it is uniquely qualified to secure the subcomponents of this system from its suppliers and to provide RESET support without jeopardizing costs, schedule, or performance of the system. Tru-Hitch has the data required to provide hardware and technical support specific to its specially designed system. Award to any other source would result in a substantial duplication of cost to the Government that would not likely be recovered through competition.

2. The Product Manager Heavy Tactical Vehicles (PdM-HTV), in conjunction with the US Army TACOM Life Cycle Management (LCMC) Cost and Systems Analysis Office, identified two possible scenarios: 1). procuring the Technical Data Package (TDP) ($8.5M) or 2). Reverse Engineering ($8.7M) in duplication of costs.

NAME COST DESCRIPTION

TDP $3.4M Technical Data Package (TDP). The Government estimates the expected cost to procure the TDP is inclusive of the Data Rights and Purchase costs. The data rights cost is present value of expected profit the Contractor would lose by selling the TDP. The purchase cost is estimated by multiplying the average system cost by the Attributable TDP purchase cost.

Test Cost $2.9M New Contractor: Cost include New Equipment Training (NEW), Initial inspection, physical characteristics, tilt table, grade ability and side slopes, Electrical Mechanical Interface (EMI), environmental, Chemical Bacteriological Radiological (CBR), Human Factors Engineering (HFE), transportability, Endurance/RAM, Final Inspection (FI) and Reporting.

Cost to Build Test Assets

$2.2M 4 Each. FWTRD and TDRT based on testing requirements, a new source must build and pass testing for the FWTRD and TDRT systems.

TOTAL $8.5M

NAME COST DESCRIPTION

TARDEC Cost $3.6M Costs include teardown, assembly, paint/stenciling, data collection during teardown assembly, documentation, research, manufacture coordinator hours and trail build.

Test Cost $2.9M New Contractor: Cost include New Equipment Training (NEW), Initial inspection, physical characteristics, tilt table, grade ability and side slopes, Electrical Mechanical Interface (EMI), environmental, Chemical Bacteriological Radiological (CBR), Human Factors Engineering (HFE), transportability, Endurance/RAM, Final Inspection (FI) and Reporting.

Cost to Build Test Assets

$2.2M 4 Each. FWTRD and TDRT based on testing requirements, a new source must build and pass testing for the FWTRD and TDRT systems.

TOTAL $8.7M

3. Project Manager Transportation Systems (PM-TS) has experience exhibiting between 12 and 18 percent cost savings in recent competitions.

For purpose of the comparison between Sole Source and Competition, PdM-HTV used a 12 percent reduction in price when using competition.

PdM-HTV selected the more conservative percentage due to the low number of systems to RESET and the minimal response to the current market survey as described in Paragraph 8.

4. Therefore, given the duplication of cost of scenario 1 ($8.5M), the potential savings of competition are eliminated. The planned savings, if reduced by 12 percent, ($6.3M X 12 percent) equals $756K. The potential savings using a competitive approach ($756K) versus the duplication costs of scenario 1 to compete the requirement ($8.5M) exhibits loss to the Government of $7.74M ($8.5M - $756K) when competing the requirement that cannot be subsequently recovered. Given the duplication of cost of scenario 2 ($8.7M), the potential savings of competition are eliminated.

The planned savings, if reduced by 12 percent, ($6.3M X 12 percent) equals $756K. The potential savings using a competitive approach ($756K) versus the duplication costs of scenario 2 to compete the requirement ($8.7M) exhibits loss to the Government of $7.94M ($8.7M - $756K) when competing the requirement that cannot be subsequently recovered.

b. Unacceptable Delay:

1. In accordance with FAR 6.302-1 (a)(2)(iii), this requirement can only be met by Tru-Hitch, the original equipment manufacturer (OEM) of this unique FWTRD and TDRT equipment identified in Paragraph 3. Tru-Hitch is the only source who has produced these systems, provided associated technical support and will provide anticipated engineering/logistical support. Any other source would require at least 24 months to perform the reverse engineering on some Tru-Hitch manufactured parts, set-up logistics processes, test, and commence delivery. This would present an unacceptable program delay in terms of meeting the Army’s critical program milestone.

2. The expected timeline for competitive vs sole source procurement would be as follows:

Sole Source Competitive Proposal Request April 2016 Market Survey (reengineering effort) April 2016

Proposal Received May 2016 Completed Synopsis/Proposal Request

June 2016

Evaluation Complete August 2016 Proposal Received July 2016

Contract Award September

Evaluation Complete April 2017

Initial Delivery January 2017 Contract Award June 2017

Reverse Engineer Jul 2017 – Jul 2018

Initial Delivery April 2019

An award to Tru-Hitch in the September 2016 timeframe would result in the RESET and delivery of both the FWTRD and TDRT starting no later than January of 2017, compared to deliveries starting around April 2019 with a competitive procurement.

Only the OEM (Tru-Hitch) can perform the work to support required capabilities for safety and technical performance necessary for the Soldier recovering damaged or catastrophically damaged wheeled vehicles without causing significant cost increases and time delays.

6. Efforts to Obtain Competition:

a. Effective Competition: Efforts to obtain competition cannot be effectively pursued without causing delay and a substantial duplication of cost, outlined in Paragraph 5, to the program. To the Government’s knowledge, there are no prior sources or attempts of becoming a source for this effort.

b. Subcontracting Competition: The contract will include FAR 52.244-5, “Competition in Subcontracting” (DEC 1996). Tru-Hitch is a small business

OPSEC

9. Interested Sources: Besides the ones noted in Section 8 above, to date no other sources have written to express an interest and no additional sources are expected.

Notices required by FAR 5.201 will be published, and any offers received will be considered.

10. Other Facts:

a. Procurement History:

1. Contract W56HZV-07-C-0768 for 18 each Interim Stryker Recovery System Generation II (ISRS) which was re-designated MCRS, was awarded on 27 September 2007 to Tru-Hitch. This acquisition was made under the statutory authority permitting other than full and open competition of 10 U.S.C.

2304(c) (2), as implemented by FAR 6.302-2, “Unusual and Compelling Urgency.” The total contract value was $2,501,836.00.

An additional award of 105 MCRS was made to Tru-Hitch with Contract W56HZV-09-C-0498 on 16 July 2009. This acquisition was made under the statutory authority permitting other than full and open competition of 10 U.S.C.

2304(c) (2), as implemented by FAR 6.302-2, “Unusual and Compelling Urgency.” The total contract value was $35,207,417, which included an option quantity of 18 MCRS, Basic Issue Items (BII), TDRT, 112 FWTRD spare parts, integrated logistics support, engineering effort, and test support.

Contract W56HZV-16-C-0007 awarded on 22 October 2015 for 20 each New FWTRDs and 49 each Winch Control Kits was made to Tru-Hitch. This acquisition was made under the statutory authority permitting other than full and open competition of Title 10 U.S.C. 2304(c)(1) as implemented by Federal Acquisition Regulation (FAR) 6.302-1(a)(2)(iii)(A) and (B) “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.” The total contract value was $2.3M.

An additional award for the Refurbishment of 11 EA FWTRDs and 36 EA TDRTs was made to Tru-Hitch with Contract W56HZV-16-D-0018 on 5 November 2015. This acquisition was made under the statutory authority permitting other than full and open competition of Title 10 U.S.C. 2304(c)(1) as implemented by Federal Acquisition Regulation (FAR) 6.302-1(a)(2)(iii)(A) and (B) “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.” The total contract value was $922,313.43.

2. The summary of contents of Paragraph 7 for the previous procurement stated there was no TDP available for a competitive acquisition. Future requirements would most likely not be competed because the Army Requirements and Resourcing Board Directive (AR2B) specifies Tru-Hitch

MCRS as the materiel solution for the validated requirement to fulfill the In the future, all interested parties will be encouraged to submit capability for satisfying similar requirements.

3. There are no prior contracts for this requirement using full and open competition.

4. There is no history of unusual patterns for MCRS procurements.

11. Technical/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.

NAME: Wolfgang Petermann DATE:

TITLE: Product Manager, Heavy Tactical Vehicles

SS//Approved// 7 Mar 2016

12. Fair and Reasonable Cost Determination:

I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable. The contractor’s proposal will be reviewed using, as applicable, cost analysis and price analysis, independent Government estimates, and Defense Contract Audit Agency audit recommendations and Defense Contract Management Agency (DCMA) rate recommendation to determine whether the cost proposals are current and justifiable. Certified cost and pricing data shall be obtained.

NAME: Eric D. Murphy TITLE: Contracting Officer

//signed-edm//

20 MAR 16

13. Contracting Officer Certification:

I certify that this justification is accurate and complete to the best of my knowledge and belief.

NAME: Eric D. Murphy TITLE: Contracting Officer

//signed-edm//

20 MAR 16

OPSEC