A03_-_DnF_for_OTFOC_under_$150K1_Redacted.pdf

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JUSTIFICATION FOR OTHER THAN FULL & OPEN COMPETITION

(ACTIONS $150,000 AND BELOW)

1. DESCRIPTION OF PROPOSED PROCUREMENT:

Preventive Maintenance Hitachi S-4700(II) Field Emission Scanning Electron Microscope (FESEM).

2. PROPOSED CONTRACTOR/MANUFACTURER:

Hitachi High Technologies, Inc 1375 N 28th Ave Dallas, TX 75261 CAGE Code: 3X725

3. ESTIMATED TOTAL VALUE:

4. STATUTORY AUTHORITY PERMITTING CONTRACTING WITHOUT PROVIDING FOR FULL

AND OPEN COMPETITION

The statutory authority permitting sole source is 41 USC 1901(e), implemented by FAR 13.106-1(b)

(1) (i): Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

5. JUSTIFICATION FOR THE AUTHORITY CITED ABOVE:

The Army Research Laboratory (ARL) Ceramics and Transparent Materials Branch (CTMB) requires a new preventive maintenance plan for the Hitachi S-4700(II) Field Emission Scanning Electron Microscope (FESEM) due to the existing preventative maintenance contract W911QX-14-P-0107 expiring on 30 April 2017.

The services required by this action provides high-priority, on-site emergency repairs. Due to the specialized nature of this instrument, only the original equipment manufacturer (OEM), Hitachi, is qualified to service the Hitachi S-4700(II). Although there are other manufacturers of similar electron microscopes, only the OEM service technicians have the knowledge of the proprietary designs, OEM parts, and procedures to effectively service the instrument. Hitachi is the only OEM that manufactures and services cold field emission systems. Only the OEM has the expertise to diagnose problems and perform repairs to this instrument that will maintain the instrument to the original specifications thereby preventing mission degradation or failure.

Due to the high cost associated with replacing the system, estimated at greater than $700,000, it is advantageous to the Government to maintain the system to OEM specification until end of life.

Replacing the system prior to its serviceable end of life would result in a substantial duplication of cost that is not expected to be recovered through full and open competition. Based on the aforementioned only Hitachi is able to perform the repair and maintenance of the Hitachi S-4700(II).

6. MARKET RESEARCH CONDUCTED/EFFORTS TO OBTAIN COMPETITION:

There are a handful of companies WORLD-WIDE that manufacture microscopes of this kind of instrument. FEI, which is headquartered in the Netherlands, JEOL and Hitachi, based in Japan, and Zeiss based in Germany are the clear leaders. Instruments from all companies were considered in the market research for the original purchase. Through market research efforts no companies are either capable or qualified to service Hitachi’s products. This, in part, isdue to the highly specialized nature of the equipment, especially the cold field emission electron source of this microscope. ARL currently has the instrument in house and nearly all of the hardware (except for the computers, keyboards, one mouse, and the monitors that are used to operate the instrument) are available only through Hitachi for replacement, repairs or upgrades.

An internet search was done with appropriate terms between Feb 1-8, 2017 by and with no new qualified service providers identified. As in the previous contract, only the OEM manufacturer is qualified for performing service on this instrument. ARL will continue to monitor the market for possible new sources which are able to meet the Government’s requirements.

7. FAIR AND REASONABLE PRICE DETERMINATION:

It has been determined that the anticipated cost to the Government will be fair and reasonable and that approval of this recommendation is in the best interest of the government. This justification is accurate and complete to the best of my knowledge and belief.

3/21/2017

X Benjamin Shelton

Contracting Officer (KO) Signed by: SHELTON.BENJAMIN.JOSEPH