REDACTED_Simplified_Acquisition_Sole_Source_Justification_over_ 150K.pdf

Control Number: JA-Adel-16-133

Simplified Acquisition Sole Source Justification Review Document

Program/Equipment: Upgrade/Modification of one (1) High Energy X-Ray

Computed Tomography (HEXCT) Scanner System.

Authority: 41 U.S.C. 1901 per FAR 13.501(a)

Amount: $504,186.71

Prepared By:

[REDACTED]

Procuring Contracting Officer:

Technical Representative:

Requirements Representative:

Reviews: I have reviewed this justification and find it adequate to support other than full and open competition.

Simplified Acquisition Sole Source Justification

Using Simplified Acquisition Procedures

1.a. Contracting Agency:

United States (US) Army Contracting Command – Aberdeen Proving Ground (ACC-APG), Adelphi Contracting Division (CCAP-SCA), 2800 Power Mill RD, Adelphi, MD 20783.

1.b. Requiring Agency:

US Army Research Laboratory (ARL), Weapons and Materials Research Directorate (WMRD), Materials and Manufacturing Technology Branch (MMTB) (RDRL-WMM-D), 4600 Deer Creek Loop, Aberdeen Proving Ground (APG), MD 21005.

2. Description of Action:

Approval is requested to solicit for a new Firm Fixed Price (FFP) contract in support of the ARL WMRD MMTB on the basis of other than full and open competition pursuant to the authority of FAR 13.501(a). The requested contract is for the upgrade of the current Government-owned HEXCT Scanner System located at ARL-APG. Fiscal Year (FY) 2015 US Army Research, Development, Test, and Evaluation (RDT&E) funding will be utilized for this effort.

3. Description of Supplies/Services:

The Government requires the upgrade and improvement modification for the current HEXCT Scanning System located at ARL-APG. The system was originally designed to scan palletized cargo for detection of explosive threats, and as such cannot function as a general purpose Non-Destructive Evaluation (NDE) instrument capable of scanning a wide variety of materials and/or materiel while providing improved spatial resolution. The current HEXCT Scanning System is designed to produce relatively fast, low resolution images of very large objects.

[REDACTED]. The HEXCT Scanner System shall be upgraded from the current system that is more than nine (9) years old with no modifications or upgrades within the last five (5) years. The breakdown of the HEXCT Sanner System

Upgrade requirements is estimated at [REDACTED] total price of the proposed acquisition to $504,186.71. General Electric (GE) Company, 1 Research Circle, Niskayuna, NY 12309-1027, CAGE: 28339, DUNS: 086188401 is the only responsible course capable of executing the required upgrade modification.

4. Authority Cited:

The statutory authority permitting other than full and open competition is 41 USC 1901, implemented by FAR 13.501(a), only one responsible source

5. Reason for Authority Cited:

The MMTB at ARL requires the upgrade and modification of the existing HEXCT

Scanner System from an exclusively explosive detection capablity to a NDE instrument. [REDACTED] GE Company is the Original Equipment Manufacturer

(OEM) of the HEXCT system and due to proprietary design knowledge of their technicians, this makes them the sole source vendor capable of updraging and modifying the current system. The modification to the HEXCT Scanner System is necessary to maintain the aforementioned testing capabilities, as it’s current configuration scans too fast and its resolution is too low. [REDACTED] The

HEXCT scanner is its own system and the required upgrade and improvement will provide both [REDACTED] and associated equipment, including XCT system(s) and its components. For example, the XCT scanning laboratory has performed inspection and analysis on a wide range of materials and materiel over the past 15 years in support of numerous programs. The materials/materiel vary from lightweight composites to metals and various components/parts are inspected and image data analyzed in collaboration with other branches and divisions. [REDACTED] Joint use of the HEXCT will be governed by a

Memorandum of Agreement (MOA) signed by both parties and will be mutually beneficial for the mission objectives and assist in Warfighter capabilities.

The objective of the system upgrade modification of the HEXCT Scanner System is to improve the system’s spatial resolution. Spatial resolution is a very important and critical performance characteristic for any working XCT NDE system.

Improving the HEXCT Scanner System with better spatial resolution will modify the system into a general purpose NDE instrument. [REDACTED] GE is the

OEM of the current Government owned HEXCT Scanning System which was originally designed and delivered for the express purpose of inspecting palletized cargo. [REDACTED] The upgrade modification will include a series of hardware and software modifications and installations, testing of system changes, and training on the modified scanner system. Due to the inherent design technology possessed by GE, these modifications must be completed by the OEM to ensure full system functionality. Because the technology is proprietary to the OEM, alternative vendors do not possess the necessary proprietary software and hardware knowledge required to ensure system functionality and execution of the required upgrade modification in accordance with Government requirements.

[REDACTED] The estimated cost to replace the current system, in it’s entirety, will likely exceed $750,000.00. This price excludes the upgrade/modifications to turn the system into an NDE instrument. Replacing the original system and adding the estimated $500,000.00 upgrade and modifications will bring the total at $1,250,000.00 in additional Government funds. Contracting with GE to execute this upgrade modification will ensure continued system functionality based on the proprietary design technology possessed by the OEM and their technicians and as a result no other source is capable of satisfying Government requirements.

6. Efforts to Obtain Competition:

Effective competition is not anticipated for this procuremented based on the market research performed (See Section 8)., however a formal Synopsis was posted to the GPE with a notice of intent to sole source to GE. The posting returned no results of interested parties stating they could satisfy the Government’s requirements. Due to the proprietary design technology of the HEXCT Scanning System, GE is the only source that possesses the inherent technological expertise to execute the required system upgrade modification. The complexity of the system design makes this required upgrade modification prohibitive to alternative vendors due to the inability to ensure system functionality, continuity, and compatibility with past, current, and future test data.

7. Actions to Increase Competition:

To date, no other vendor has been identified that has the ability to upgrade and modify the system to meet all of the Government’s specifications. The Government will continue to conduct market research to increase competition by attending conferences/exhibitions, conduct internet research, and maintain open discussion with industry experts. Continued oversight of the HEXCT Scanning System marketplace will allow for Government requiremetns developers to stay knowledgeable about the best and most advanced technologies available. The GE HEXCT Scanning System design is proprietary to the OEM, however as the HEXCT Scanning System industry continues to advance the Government will continue to monitor this market to ensure all evolutions in system technology are taken into consideration in future procurements .

8. Market Research:

Market Research was performed January 2015 through June 2015 [REDACTED] Market research was conducted by querying Government-wide databases of contracts and other procurement instruments, searches in the General Services administration (GSA) General Supply Schedule, review of published RFIs and technical publications and journals, reviews of catalogs and other product literature published by manufacturers, and internet searches. In addition, reviewing previous procurement actions that include the following contract numbers: W911QX-14-T-0022 (XCT Scanner System Upgrade Kit), W911QX-11- P-0038 (VG Studio MAX V2.1 Upgrade), DAAD17-00-C-0079 (CT/DR Scanner With High Resolution Detector), DAAL01-96-R-9850 (High Resolution X-Ray Computed Tomography System) was also done. Research found that GE Global Research is the only offeror capable of satisfying the requirements in Section 5.

Market research resulted in five (5) alternative offerors that currently produce XCT systems, however each offeror has their own techniques and processes for designing and building such systems; Varian Medical Systems (VMS), North Star Imaging (NSI), VJ Technologies, Nikon, Advanced Research and Applications Corporation/Rapiscan.

VMS manufactures products for medical, security, and industrial imaging, including x-ray tubes, linear accelerators (linacs), detectors, and imaging software. VMS produces specialized imaging software and hardware for advanced digital medical imaging systems. The VMS x-ray detectors and imaging software will not be compatible or functionally usable with the existing 9 Mega electron Volt (MeV) HEXCT Scanner System. VMS will not be aware of specific and proprietary GE Global Research’s methods or components of the HEXCT Scanner System, which will require the complete replacement of the system that is compatible with VMS, as opposed to a simple modification and upgrade. Therefore, VMS is unable to meet the Government’s requirement.

NSI manufactures three-dimensional (3-D) x-ray CT and two-dimensional (2-D) digital radiography systems with x-ray energies up to 450 kilo electron Volts (keV). NSI typically provides a solid state flat panel or linear diode array detector in their systems, which is not compatible with the high energy (9 MeV) detector system in the the existing HEXCT Scanner System. The NSI imaging software will also not be compatible with the HEXCT system software, which will be modified and added to within the proprietary GE Global Research’s imaging software application framework. NSI will not be aware of specific and proprietary General Electric methods or components of the HEXCT Scanner System, which will require the complete replacement of the system that is compatible with NSI, as opposed to a simple modification and upgrade. Therefore, NSI is unable to meet the Government’s requirement.

VJ Technologies (VJT) develops and manufactures a line of automated, manual, and turnkey x-ray inspection systems, historically focusing on 2-D digital systems combined with low energy x-ray sources (< 250 keV). Recently, VJT partnered with the Fraunhofer Research Institute in Germany, to design and provide 3-D x-ray CT systems. The VJT/Fraunhofer x-ray detectors and imaging software will not be compatible or functionally usable with the Government’s existing 9 MeV HEXCT Scanner System. Again, the HEXCT system imaging software will be modified and added to within the proprietary General Electric imaging software application framework. VJT/Fraunhofer will not be aware of specific and proprietary General Electric methods or components of the HEXCT Scanner System, which will require the complete replacement of the system that is compatible with VJT/Fraunhofer, as opposed to a simple modification and upgrade. Therefore, VJT/Fraunhofer is unable to meet the Government’s requirement.

Nikon Corporation (Nikon) specializes in manufacturing optics and imaging products, including x-ray CT inspection systems using sources of up to 750 keV energy. Nikon typically provides a solid state flat panel or a proprietary curved linear array detector with their systems. The Nikon x-ray detectors and imaging software will not be compatible or functionally usable with the existing 9 MeV HEXCT Scanner System. The HEXCT system imaging software will be modified and added to within the proprietary General Electric imaging software application framework. Nikon will not be aware of specific and proprietary General Electric methods or components of the HEXCT Scanner System, which will require the complete replacement of the system that is compatible with Nikon, as opposed to a simple modification and upgrade. Therefore, Nikon is unable to meet the Government’s requirement.

And finally, the Advanced Research and Applications Corporation (ARACOR) manufactures test and inspection equipment, including high energy, one MeV and higher, x-ray imaging systems. ARACOR was bought in 2004 and has since been renamed the Rapiscan Systems High Energy Inspection Corporation.

ARACOR/Rapiscan does provide very high energy x-ray sources that is compatible with the energy sources used by the HEXCT Scanner System.

However, the ARACOR/Rapiscan’s high energy x-ray detectors and imaging software are not compatible or functionally usable with the existing 9 MeV HEXCT Scanner System. The proprietary HEXCT system detectors will be modified. The HEXCT system imaging software will be modified and added to within the proprietary General Electric imaging software application framework.

ARACOR/Rapiscan is not aware of specific and proprietary General Electric methods or components of the HEXCT Scanner System, which will require the complete replacement of the system that is compatible with ARACOR/Rapiscan, as opposed to a simple modification and upgrade. Therefore, ARACOR/Rapiscan is unable to meet the Government’s requirement.

There are a relatively small number of companies that produce XCT systems and each company has their own techniques and processes for designing and building their systems. These companies include the aforementioned manufacturers of XCT systems. The XCT hardware, including x-ray detectors, and software, which runs the scanner system, of other vendors is not expected to be compatible or functionally usable with the HEXCT system. Vendors other than General Electric do not have the required compatibility with the HEXCT system or the specific software/hardware knowledge that meets the Government’s requirement. These vendors will not be able to ensure continuity of use and the required functionality of upgraded and improved hardware and software with the rest of the HEXCT system. All of the modifications to upgrade and improve the HEXCT system must be successfully integrated into it to provide proper functionality. After extensive research, it was determined that General Electric is the only company that is capable and compatible with their own schematics and equipment to perform modifications, testing and training on the Government’s current HEXCT Scanner System. Due to the aforementioned, General Electric is the sole vendor capable of meeting the Government’s requirements.

9. Interested Sources:

A Synopsis was posted to the GPE on 22 April 2016 with a closing date of 29 April 2016. To date, no response have been received and no other sources have written in to express interest. The notices required by FR 5.201 shall be published and all bids or proposals shall be considered.

10. Other Facts:

a. Procurement History:

This is first-time buy therefore no procurement history exists

b. Other Facts:

This is not a follow-on contract

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.

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.

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. The proposed cost will be determined fair and reasonable in accordance with FAR 13.501(a)(1). In addition, current published price lists/catalogs/invoices for exact or comparable items sold to a different firm or agency will be reviewed, along with a vendor statement.

14. Procuring Contracting Officer Certification:

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

APPROVAL

Based on the foregoing justification, I hereby approve the procurement of the High Energy X-Ray Computed Tomography (XCT) Scanner System Upgrade on an other than full and open competition basis pursuant to the authority of 41 USC 1901, implemented by FAR 13.501(a), subject to availability of funds, and provided that the services and property herein described have otherwise been authorized for acquisition.