JAStorage.doc

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Agency: Southern Region Contracting Office - West, Brooke Army Medical Center, Fort Sam Houston, TX, 78234-6000.

2. Description of Action: Request approval to solicit a sole source acquisition as outlined in FAR 6.302-1 2 for the lease of warehouse storage space and inventoory management support provided by EDC Moving Systems. This storage requirement is mission critical and necessary to support the storage of approximately 30K square feet of government purchased medical equipment and supplies under contract W81K04-09-F-0012 ($102 million value), which expires on March 15, 2012, while ongoing outfitting actions will continue through the remainder of FY12.

3. Description of Products/Services: The EDC Moving Systems storage lease is mission critical and necessary to provide adequate storage of medical equipment and supplies. EDC will provide 28,942 square feet (with multi-level storage capability) of storage space to accommodate over $10 to $15 million in government purchased medical equipment and supplies which were purchased under contract W81K04-09-F-0012, for the outfitting of the COTO. Additionally, EDC will provide inventory management and delivery services to ensure that all government procured equipment is properly transferred to the San Antonio Military Medical Center (SAMMC) per a government provided schedule. The lease of the storage space is necessary due to construction delays, which have prevented the Consolidated Tower (CoTo) from completing on time and allowing the complete delivery of all medical equipment purchased under the existing IO&T contract. There is no government controlled warehouse space available to support this requirement and the existing contract expires on March 15, 2012, which currently includes the warehouse storage space requiring the Lockheed Martin warehouse to be emptied by February 15,201, to comply with its lease. Failure to award this contract may result in claims against the government (the government currently pays up to $25K per month for the storage of a much smaller volume of equipment under a BPA) for storage costs associated with the $10 to $15 million of government equipment remaining in the current warehouse upon expiration of the existing contract on March 15, 2012.

4. Authority Cited: The statutory authority permitting other than full and open competition is 10 U.S.C. 2304 (c) (1), as authorized by Federal Acquisition Regulation (FAR) 6.302-1- Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements. The failure to award this contract to EDC may result in substantial cost to the government to transfer equipment from its current warehouse (EDC) to another location along with charges from the new vendor to establish an inventory accountability system that mirrors the existing, proprietary system that has been used by EDC for the past two years.

5. Reason for Cited Authority: EDC Moving Systems has provided warehouse storage and inventory management support under contract W81K04-09-F-0012, which expires on March 15, 2012. There are currently between 5 and 12 project areas in the SAMMC Consolidated Tower that will not be completed before the existing contract expires. These project areas represent 1,304 line items of medical equipment that require storage after March 15, 2012 (not counting incoming items that will arrive over the course of the next 60 days). EDC has established a proprietary inventory management system that allows them to track and deliver equipment to SAMMC in a very efficient manner. If another vendor is used to fulfill this requirement, the government would be liable for substantial charges (estimated at between $50K and $100K, which represents a third of the proposed contract’s cost) associated with transferring equipment from the existing warehouse to the new vendor’s warehouse (risking potential equipment damage) and any charges from the new vendor associated with developing an inventory management system. EDC has been engaged in this project since 2009 and has the technical knowledge and project familiarity to ensure that there are no vendor delays associated with future equipment deliveries.

6. Efforts to Obtain Competition: This action will be advertised on FedBizOpps with a notice of intent to award a sole source contract to one and only one responsible source. No other efforts to obtain competition will be made for this requirement.

7. Actions to Increase Competition: Future acquisitions will also be synopsized in FedBizOpps.

8. Market Survey: Market research via the internet, and e-mail, indicates that there are other companies that provide the necessary storage services; however, the companies will be required to take possession of the equipment from an existing warehouse and will likely charge the government a substantial fee for this service (estimated at between $50K and $100K). The current vendor (EDC) has developed a proprietary inventory control system that matches the existing project codes for this $500 million construction project. Requiring another vendor to develop and use a system that is similar to EDC’s system may result in considerable cost to the government for a process that already exists and that the government has already paid for.

9. Interested Sources: To date, no other sources have expressed an interest in this requirement.

SOURCE SELECTION INFORMATION – SEE FAR 2.101 AND 3.104