J&A_Stewart_2019_48_Redacted.pdf

Control No: MICC 2019-48 Contractor: TSAY/Ferguson-Williams, LLC

Service: Facilities Operations and Maintenance Service

Version – September 2018 FOR OFFICIAL USE ONLY

FAR Part 6 Justification and Approval (J&A) for Other than Full and Open Competition

1. Contracting Activity: U.S. Army Mission and Installation Contracting Command (MICC) – Fort Stewart, 976 William H. Wilson Avenue, Suite 100, Fort Stewart, Georgia 31314-3425.

2. Description of Action: The Fort Stewart Directorate of Public Works requests a 6 month, cost plus award fee extension to contract W9124M-09-C-0002 with TSAY Ferguson-Williams LLC, Highway 68 North of Espanola, San Juan Pueblo, New Mexico.

The Government projects award for July 2019 and will use fiscal year 2019 Operations and Maintenance, Army funds. This extension would continue the current fee rates of

3. Description of Services: This contract provides facilities operations and maintenance (O&M) support for Fort Stewart and Hunter Army Air Field. Contract tasks include: building maintenance, central energy plant operations, water distribution, waste water treatment, and landfill operations. This contract is critical to maintaining installation infrastructure and provides a number of basic municipal services.

Period of Performance: 1 August 2019 to 31 January 2020 Total Value: $16,500,000.

4. Authority Cited: 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1, Only one responsible source and no other supplies or services will satisfy agency requirements.

5. Reason for Authority Cited: As described at FAR 6.302-1(a)(2)(iii), for DoD, a service may be deemed to be available only from the original source in the case of follow-on contracts for the continued provision of highly specialized services when it is likely that award to any other source would result in (A) Substantial duplication of cost to the Government that is not expected to be recovered through competition, or (B) Unacceptable delays in fulfilling the agency’s requirements.

a. Background: Fort Stewart’s current O&M support contract was awarded 26 March 2009. The final option is due to expire on 31 July 2019. The acquisition planning for the follow-on contract started in July 2017, and the solicitation for a follow-on contract is currently being drafted. This acquisition has taken longer than expected due in part to changing the contract type to firm fixed price from the original cost plus award fee and associated changes. This change was made in November 2018, which disrupted the progress of the acquisition by requiring updating the market research, acquisition strategy, bid schedule, technical exhibits with workload data, and posting revised notifications to industry. As such, the follow-on contract is now projected for award on 25 October 2019. The current contract includes contract clause 52.217-8 Option to Extend Services, which provides relief for this specific situation. Unfortunately, after a thorough review of the contract file, there is no proof that this option was evaluated at time of award. Also, there was no proof in the pricing reports or source selection documents to indicate that this option was evaluated at award. This evaluation did not become routine practice until the Government Accountability Office (GAO) protest Major Contracting Services, Inc. B-401472 was sustained some 4 months after award. In the decision of Major Contracting Services, Inc., B-401472, September 14, 2009, the Government Accountability Office (GAO) held that where an agency failed to evaluate the price of an extension authorized by FAR 37.111, as implemented in FAR Clause 52.217-8 Option to Extend Services, the exercise of an option under that clause constituted a “new procurement” that had to meet the FAR Part 6 standards for less than full and open competition. Although this contract contains FAR Clause 52.217-8 Option to Extend Services, the clause was not evaluated in accordance with the GAO’s criteria. Accordingly, in order to exercise the clause and extend the services under the contract for an additional 6 months, the action must fall within the ambit of a proper sole source contract action under FAR Part 6.

The O&M contract has a large scope with various types of work. There are numerous construction and service occupations including electricians, plumbers, welders, heating and air technicians, etc. covered under numerous Service Contract Act and Davis Bacon Act wage determinations and a Collective Bargaining Agreement (CBA). It is the highest valued contract administered by MICC – Fort Stewart contracting office. It is also has a greater degree of complexity due to the large amount of GFP (Government Furnished Property). GFP inventory is currently valued at approximately $2.7M. Due to the scope and complexity of this requirement it is impractical to solicit this interim requirement and bring in a new contractor for this 6 month period. The incumbent contractor, TSAY/Ferguson-Williams (TFW), LLC, is the only source that is already deployed on the ground with personnel who are trained with all the required tools, equipment and resources to offer continuous services without any interruption. Bringing in another contractor in the interim would also lead to a very substantial unjustifiable cost of approximately $4M resulting from the duplication of effort required to conduct another phase-in and transfer of GFP. The current contract allows a 120 day phase-in period. While this could be compressed to some extent it is hard to conceive that the phase-in could be completed in less than 30 days. This process would then have to be repeated once the follow-on contract is awarded.

b. Alternatives:

1) Exercise the 6 month extension IAW contract clause 52.217-8 Option to Extend Services: This is the best alternative. The clause was included in the original solicitation and intended to be available to the Contracting Officer, but since it was not evaluated, a J&A is required to exercise this option. This will keep the current contractor, in place, avoiding both a disruption to the operations at Fort Stewart, and duplicative costs of multiple contractors conducting phase-in inventories and hiring of new personnel over a very short timeframe.

2) Conduct a competitive acquisition for the interim work: There is no possibility of this being completed in time. The acquisition lead time for a contract of this complexity would be significant. Even if a competitive interim contract could be awarded, it is still not a viable alternative as the majority of the contract period would be dedicated to phase-in activities, then quickly followed by phase-out activities when the long term contract is awarded. It is not feasible for a vendor to assemble the extensive capabilities required to perform this service for this brief period.

3) Perform the work without contract support. This option is perhaps the most risky. Service would be greatly diminished as there are not enough trained and available civilian or military personnel to assume work of this scope and complexity.

This contract requires numerous certifications and licenses including State of Georgia Class I and II waste water certifications and Class I and II water certification. The boiler operators also must have industry certification.

c. Impact: The facilities O&M contract provides critical service for Fort Stewart. Any disruption of the core services of building maintenance, central energy plant operations, water distribution, waste water treatment, landfill operations, and emergency repairs would have an immediate negative impact to Fort Stewart’s readiness, health, and safety. Without this contract there would be no operators for wells, lift stations, waste water treatment plant, or the central energy plant. In addition to the crippling loss of potable water, Fort Stewart would soon be subject to fines for not meeting environmental standards for water, air, and waste water. Due to the strategic importance of Fort Stewart’s support of the 3d Infantry Division and other tenant units, the risk of mission failure due to facility maintenance problems is unacceptable.

6. Efforts to Obtain Competition: The Contracting Officer shall publish the notices required by FAR 5.201 and any proposals received shall be considered.

a. Effective Competition: Because this is a sole source action, effective competition is not applicable. However, the follow-on award will be solicited competitively.

b. Subcontracting Competition: TFW was certified as a small business at time of award and was not required to have a subcontracting plan. During the course of the contract, TFW exceeded the small business size standard and was required to develop a plan with small business goals. Subsequently, TFW fell within the size standard and was no longer required to have a subcontracting plan. Though no longer required, TFW still monitors subcontractor activity to ensure competition and access for local small businesses. In 2018, TFW contributed to the local business base by subcontracting approximately $2.5M worth of work to other small businesses.

7. Actions to Increase Competition: The solicitation for the follow-on contract is being drafted as a competitive acquisition. Market research is ongoing in order to determine an appropriate set aside program. The pre-solicitation announcement for the follow-on contract has been posted on the Federal Business Opportunities (FBO) website and, several vendors have expressed interest.

8. Market Research: Fort Stewart conducted market research on 21 September 2018, in order to support the current option period which runs from 1 October 2018 through 31 July 2019. This research determined that exercising the last option was the most advantageous method of fulfilling this requirement. The research relied on a review of similar contracts, including W911RZ-17-C-0002 for base operational support for Fort Carson and W911SG-14-C-0001 for facility operations support service for Fort Bliss.

The market research was also based on current labor rates according to the latest wage determinations. The market conditions have not changed since this most recent market research. Additionally, there is no market changes of note in the market research report for the follow-on contract. As such, the current period pricing is still the most advantageous means of meeting this requirement.

In accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 205.205-71, DFARS 206.302-1(d), and DFARS Procedures, Guidance and Information (PGI) 206.302-1(d), a sources sought was posted to Federal Business Opportunities (FBO) on 3 March 2019 for 8 days.

9. Interested Sources: Four responses were received in response to the sources sought synopsis posted on FBO on 3 March 2019. None of the contractors demonstrated the necessary capability, nor claimed to have the ability to be operational in the required timeframe. All respondents expressed an interest in the follow-on contract. To date, no other sources have written to express interest in the acquisition.

10. Other Facts: While this requirement has been competitive since inception, the option to extend services in accordance with contract clause 52.217-8 is a sole source action.

a. Procurement History.

Contract: W9124M-09-C-0002 Contractor: TSAY/Ferguson-Williams, LLC Contract type: Cost plus award fee Award Date: 26 March 2009 Competitive Status: Competitive, Small Business Set Aside

Contract: DAKF10-01-C-0001 Contractor: Griffin Services Inc.

Contract type: Cost plus award fee Award Date: 6 April 2001 Competitive Status: Competitive, Small Business Set Aside