REDACTED_ACC-WRN_Urgent_JA_APU_NoLegalObjectionJMO.pdf

CMO Control Number: 2019-028

FOR OFFICIAL USE ONLY

Department of the Army Justification and Approval (J&A) for Other than

Full and Open Competition

1. Contracting Activity: The Army Contracting Command – Warren (ACC-WRN) is the procuring activity for this action.

2. Description of Action: ACC-WRN proposes to award a new Firm-Fixed-Price (FFP) contract to Fischer Panda Generators, Inc. (Fischer Panda) for a total of 210 each Auxiliary Power Units (APU). This effort will utilize Fiscal Year 2019 Army Working Capital Funds (AWCF).

3. Description of Supplies: The APU consists of a Hatz 2G40 2-cylinder diesel engine coupled to a chain-driven gear case that in turn drives a hydraulic pump and a 300-Amp generator. The APU provides electrical and hydraulic power to the M88A1/A2 Recovery Vehicles for auxiliary and emergency functions. The APU is used to charge the vehicle batteries, power the hydraulic impact wrench, and power the refuel/defuel pump. The M88 Recovery Vehicle provides battle field recovery operations in support of the light and medium tactical vehicles, M1/M1A1 Abrams, and any other current and future 70 ton class vehicles. The U.S. Army Tank-Automotive and Armaments Command, Life Cycle Management Command (TACOM-LCMC), Integrated Logistics Support Center (ILSC) Combat Maneuver and Recovery (CM&R) Product Support Integrated Directorate (PSID) has a requirement for the APUs, NSN 6115-01-465-8922, Part Number 12367093. The estimated unit price per APU is XXX and the total estimated value of this action is $XXXXX. Purchase Request Ordering Number (PRON) EH9C0151EH was generated to support this urgent procurement for a quantity of 210 each.

4. Authority Cited: The statutory authority permitting other than full and open competition is Title 10 United States Code (U.S.C.) Section 2304(c)(2), as implemented by Federal Acquisition Regulation (FAR) 6.302-2(a)(2), "When the agency’s need for the supplies or services is of such an unusual and compelling urgency that the Government would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals, full and open competition need not be provided for."

5. Reason for Authority Cited:

a. Background: FAR 6.302-2(a)(2) is applicable to this procurement because the subject item is currently in a critical supply position. The Army is in a critical supply position caused by Minowitz Manufacturing Company (Minowitz), the Original Equipment Manufacturer (OEM), going out of business. Minowitz was the only previous supplier for APU spares requirements. Minowitz was a viable business entity at the time of award for contract SPRDL1-16-C-0004, which is the last spares contract that APUs were delivered against. Defense Logistics Agency – Warren (DLA) was the contracting activity when Minowitz went out of business. With Minowitz no longer a source, DLA issued a new competitive FFP solicitation for APUs that was awarded to

CMO Control Number: 2019-028 XXXXXXX (XXXXX) on 01 August 2017. This was a 3 year Indefinite-Delivery Indefinite-Quantity (IDIQ), XXXXXXX, with a minimum quantity of 9 each and a maximum quantity of 150 each. This was XXXXX first opportunity to produce the APU, requiring First Article Testing (FAT) which was due on XX XXXX XXXX. XXX requested a FAT extension to 29 March 2019, with the assurance from the contractor that deliveries would remain on schedule if FAT was approved by the end of April 2019. In late 2018, ACC-WRN took over the procuring authority for new APUs and the contract administration of Contract XXXXXX ACC-WRN issued a cure notice on contract XXXXXX Delivery Order XXX to XXXXX on 12 February 2019, to ensure the contractor submitted FAT by the required due date of 29 March 2019. XXXX was unable to complete FAT by 29 March 2019 so ACC-WRN is in the process of terminating that contract.

As a result of the contract with XXXX being terminated, the Army now has an urgent need for a quantity of 210 each APUs, see chart below. Concurrent with this urgent action, ACC-WRN will solicit and award a new competitive IDIQ contract to fulfill future non-urgent requirements. As of 16 May 2019 the total backorder quantity was 67 each.

The Acquisition Lead Time (ALT) for a new contract is 10 months, and the Production Lead Time (PLT) is a minimum of 9 months without FAT and 15 months with FAT. FAT is required to validate prospective contractors have the manufacturing capability, processes, and facilities to produce the APUs IAW the technical requirements of this procurement. Army Combat Capabilities Development Command Ground Vehicle Systems Center Quality Assurance has determined no other type of quality assurance testing is acceptable. The following chart details the units required to meet backorders and monthly demand until a new competitive contract is awarded and FAT is approved:

Category Quantity Current urgent backorders 67 Urgent demands through estimated new competitive IDIQ contract award and production lead time for FAT approval 118 Urgent demands to support current unit vehicle shortages for M88A2 European Defense Initiative (EDI) and M88A1 Army Reserve and National Guard 25 Total urgent demands 210

Fischer Panda is an existing subcontractor to British Aerospace Engineering (BAE) in support of the Ground Combat Systems-Combat Recovery Systems (GCS-CRS) M88A2 production program. Fischer Panda is a current supplier of APUs and is a qualified source, receiving FAT approval in March 2018. Fischer Panda can start delivery of 15 to 20 units per month within 9 months after contract award date. Award of this urgent requirement to Fischer Panda will fulfill the Army’s backorders and continuing urgent requirements until a competitive contract can be awarded. The continued APU out-of-stock position will result in Soldiers’ inability to perform their mission, placing them in immediate danger. A vehicle in need of an APU replacement is inoperable until the new APU is installed. If the backorder and current stock is not fulfilled, Soldiers are placed in direct danger because of deadlined vehicles, putting Soldiers’ safety at risk and causing an inability to carry out their mission.

6. Efforts to Obtain Competition: Competition will not be pursued based on the information provided in section 5 above. This action will not be synopsized in Federal Business Opportunities (FedBizOpps) per the exception at FAR 5.202(a)(2), Unusual and Compelling Urgency.

b. Subcontracting Competition: A subcontracting plan is not required as Fischer Panda is a small business.

7. Actions to Increase Competition: The Government owns the data rights to use the TDP with the exception of the Hatz engine, however the top level print is not source controlled and can be competed openly. Additionally, the Hatz engine is commercially available. Therefore, the Government will utilize full and open competition for future non-urgent requirements.

8. Market Research: A Request for Information (RFI) W56HZV-19-R-0050 was published to FBO on 18 April 2019 and closed on 25 April 2019. Two contractors responded to the RFI; Artemis Electronics, LLC and Marvin Land Systems, INC. (both small businesses). The RFI W56HZV-19-R-0050 required FAT approval for the APUs, due to the urgent nature of this procurement. Artemis Electronics, LLC and Marvin Land Systems, INC were unable to meet the required APU FAT and therefore, cannot be considered for award of this urgent requirement. However, Artemis Electronics, LLC and Marvin Land Systems, INC. expressed an interest in the subsequent competitive award for future non-urgent requirements.

As of 20 May 2019, CCDC has confirmed no other sources have an approved FAT.

Fischer Panda is the only approved source to have an approved FAT for this requirement.

CCDC Engineering and Quality Assurance Subject Matter Experts (SMEs) frequently perform research pursuant to FAR 10.002(b)(2). The SMEs consider current market conditions on vehicles and variants, components, and the capabilities of industry to accomplish the proposed effort when evaluating potential vendors.

In February 2019, the M88 APU inventory manager and CCDC engineer contacted Fischer Panda to see if they could supply APUs on a new spares contract. Fischer Panda responded that it could produce with a nine month lead time after contract award at a rate of 15 to 20 per month. Engineering determined Fischer Panda was the only provider that could start production of the APU without FAT. Fischer Panda can start delivery earlier compared to other vendors because Fischer Panda has a current FAT approval. Fischer Panda has previously produced these units, both as a subcontractor for the M88 vehicle production contract (W56HZV-14-C-0298), and as a prime contractor for Modification Kits (SPRDL1-18-D-0043), of which the APU is a subassembly. Based on this information and since Fischer Panda passed FAT in March 2018, FAT is not a requirement for this procurement. With the elimination of

FAT, Fischer Panda production lead time is substantially less compared to other vendors and can meet the Army’s schedule requirement.

9. Interested Sources: To this date, other than the contractors who responded to the RFI, no other sources have written to express an interest. No other contractor has passed FAT, which is required to supply APUs in time to meet Army urgent needs, as described in Section 5 above.

10. Other Facts:

a. Procurement History.

I. Contract: SPRDL117D0119 Contractor: Essex Electro Engineers, Inc.

Award Date: 01 August 2017 Competitive Status: Competitive QTY Delivered: 0 each Last Price: $32,500.00 each

II. Contract: SPRDL116C0004 Contractor: Minowitz Manufacturing Inc.

Award Date: 29 October 2015 Competitive Status: Competitive QTY Delivered: 48 each Last Price: $26,500.00 each

III. Contract: SPRDL112C0200 Contractor: Minowitz Manufacturing Inc.

Award Date: 18 September 2012 Competitive Status: Competitive QTY (base): 39 each Last Price: $23,856.73 each QTY (option): 39 each Last Price: $23,879.00 each

11/12. 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: Nicholas Fulgenzi Title: Director, CM&R PSID Date: 6June 2019 Signature: //s//Nicholas Fulgenzi

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost for this action will be fair and reasonable. IAW FAR 15.403-4(a)(1), certified cost and pricing data is required for this procurement. ACC-WRN will obtain whatever data is available from the Government or other secondary sources and use that data in determining a fair and reasonable price. The offer received from Fischer Panda will be compared to APU historical price data, based on previous competitive vendor contracts with the U.S. Army. ACC-WRN may also require data other than certified cost or pricing data from Fischer Panda.

Name: Mark R Hirsch Title: Contracting Officer Signature: ///MRH/// Mark Hirsch Date: 6/6/2019

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

Name: Mark R Hirsch Title: Contracting Officer Signature: ///MRH/// Mark Hirsch Date: 6/6/2019

Approval

Based on the foregoing justification, I hereby approve the procurement of 210 each Auxiliary Power Units on an Other Than Full and Open Competition basis pursuant to the authority of Title10 United States Code 2304(c)(2), as implemented by FAR 6.302- 2(a)(2), "When the agency’s need for the supplies or services is of such an unusual and compelling urgency that the Government would be seriously injured.” 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 estimated value of this acquisition is $8,447,670.

6/12/2019

X LaRuth Shepherd LaRuth Shepherd Competition Advocate Signed by: SHEPHERD.LARUTH.1230673116