W9127825BA002_FY25 Hopper Consolidation DF Redacted.pdf

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DEPARTMENT OF THE ARMY

U.S. ARMY CORPS OF ENGINEERS, MOBILE DISTRICT

DETERMINATION AND FINDINGS

REQUEST FOR CONSOLIDATION

W9127825BA002

INDEFINITE DELIVERY INDEFINITE QUANTITY (IDIQ) SINGLE AWARD TASK

ORDER CONTRACT (SATOC) FOR MAINTENANCE DREDGING, HOPPER DREDGE

AND ATTENDANT PLANT FOR DREDGING IN ALABAMA, MISSISSIPPI, AND

FLORIDA

Federal Acquisition Regulation (FAR) 2.101 defines consolidation or consolidated requirement as a solicitation for a single contract, a multiple-award contract, a task order, or a delivery order to satisfy— (i) Two or more requirements of the Federal agency for supplies or services that have been provided to or performed for the Federal agency under two or more separate contracts, each of which was lower in cost than the total cost of the contract for which offers are solicited; or (ii) Requirements of the Federal agency for construction projects to be performed at two or more discrete sites. FAR 7.107-2 requires that consolidation of requirements with an estimated total dollar value exceeding $2 million shall be supported by a written determination that consolidation is necessary and justified in accordance with 15 U.S.C. § 657q.

I have reviewed this requirement and associated market research and determined in accordance with 15 U.S.C. § 657q and FAR 7.107-2 that consolidation is both necessary and justified. This approval is made in accordance with the approval thresholds set forth in Army Federal Acquisition Regulation Supplement (AFARS) 5107.170, “Consolidation of Contract Requirements.” My review resulted in the following findings:

FINDINGS

1. Introduction: Mobile District plans to solicit offers and award an Indefinite Delivery Indefinite Quantity (IDIQ) Single Award Task Order Contract (SATOC) for a hopper dredge and attendant plant for dredging in Alabama, Mississippi, and Florida. The primary requirements are several deep draft Federal navigation channel dredging projects. The SATOC will meet dredging requirements under North American Industry Classification System (NAICS) code 237990 and with a contract capacity of $30,000,000.00 over a 14-month ordering period. The Mobile District has conducted market research that demonstrates the consolidation of this procurement is both necessary and justified.

2. Description of Procurement Action:

a. Project Description:

(1) The Mobile District is tasked with maintaining area harbors, rivers, waterways, channels, and bays within Alabama, Mississippi, and Florida. Among these are requirements for deep draft dredging of Federal navigation channels. The Mobile District has utilized civil works funded, multi-year IDIQ SATOCs for over ten years to provide flexible and effective management of deep channel dredging requirements on both a scheduled and an as needed basis. Each project is assigned a Project Delivery Team (PDT) comprised of various organizational elements within the District that provides operations support, technical, contracting, legal, and resource management services to support the project.

(2) The purpose of this acquisition is to provide a contracting tool to support the Mobile District’s need to perform annual maintenance dredging at various shoaling locations of the Federal navigation projects of Mobile, Pascagoula, Gulfport, Pensacola, and Panama City Harbors. These dredging locations will be identified based on channel conditions and the need to restore specific reaches to their project depth. Some of the shoals may include toe shoaling, bar channel shoaling, and shoals with disposal restrictions. The types of work will be those which are generally more cost efficient to perform utilizing a hopper dredge. The solicitation will be advertised as unrestricted, and the contract duration will be fourteen months with a maximum capacity of $30,000,000.00.

Mobile District intends to consolidate these dredging requirements into one solicitation to be awarded to one contractor. The projects which Mobile District maintains are funded on an annual or biannual basis. Due to the need to sustain existing civil works projects, the Mobile District does not anticipate current or future budget limitations to impact this program.

b. Acquisition Strategy/Procurement Summary: To meet the demanding requirements for maintenance dredging at various shoaling locations of the Federal navigation projects of Mobile, Pascagoula, Gulfport, Pensacola, and Panama City Harbors, the District intends to award an unrestricted IDIQ SATOC. This consolidated procurement will be advertised as an unrestricted, Firm Fixed Price, Invitation for Bid (IFB) with a maximum contract capacity of $30,000,000.00.

The construction duration will be 14 months and no options are anticipated. An IDIQ SATOC is the most effective manner to meet the above requirements for several reasons including that this acquisition approach will efficiently facilitate the District’s management of maintenance dredging in the prescribed Federal navigation projects, and that it will position the District to successfully meet urgent, end of fiscal year requirements, and respond to emergency situations. While the funding for dredging is “no-year” money, the Mobile District Operations Division is allotted a specific amount per fiscal year (FY) and nearly all those funds are expended. The use of a SATOC tool is in the best interest of the Government with respect to timeliness, oversight, and administrative costs.

c. Applicability of Consolidation: As stated above, Sec 1671 of the fiscal year 2013 National Defense Authorization Act (NDAA) amended the definition of consolidation as set forth in Sec 44 of the Small Business Act, 15 U.S.C. § 657q., and as implemented in FAR 2.101, “consolidation or consolidation requirements” means a use of a solicitation for a single contract, a multiple award contract, a task order, or a delivery order to satisfy (i) two or more requirements of the Federal Agency for supplies or services that have been provided to or performed for the Federal agency under two or more separate contracts, each of which was lower in cost than the total cost of the contract for which offers are solicited; or (ii) requirements of the Federal agency for construction projects to be performed at two or more discrete sites. The definition applies to this procurement because a SATOC will be used to perform multiple construction projects, awarded on individual task orders, at two or more discrete dredging sites in Alabama, Mississippi, and Florida.

The Mobile District intends to consolidate the maintenance dredging of deep draft navigation projects for Mobile, Pascagoula, Gulfport, Pensacola, and Panama City Harbors into one solicitation for an IDIQ Dredging contract. By consolidating these requirements, the Mobile

District will be able to efficiently coordinate and respond to the dynamic requirements of these dredging projects at a significant savings of cost and time, as well as accommodate the dredging environmental windows. This also allows dredging companies to organize their work more effectively; lowers unit costs, due to economy of scale; and more efficiently schedule their dredging equipment for the most efficient regional approach to meet the needs of the Corps of Engineers dredging program.

d. Requirements Being Consolidated: The Mobile District intends to consolidate the maintenance dredging of deep draft navigation projects for primarily located in Mobile, Pascagoula, Gulfport, Pensacola, and Panama City Harbors into one solicitation for an IDIQ Dredging contract. The locations of these navigation projects are shown in Attachment 1. Work under this consolidation D&F may also be utilized for any unforeseen locations within the Mobile District's Area of Responsibility (AOR) and in response to catastrophe or other emergencies. The Mobile District’s AOR includes portions of the states of Alabama, Mississippi, and Florida. The entire acquisition is for $30,000,000.00 to perform the maintenance dredging at these navigation projects. These projects are funded by Civil Works Appropriations.

e. Procurement History: The Mobile District has procured these services through consolidated and non-consolidated means in the past. Non-consolidated contracts refer to the award of a SATOC for a single Federal navigation project or a “C” contract. The contracts listed in Table 1 are considered non-consolidated SATOCs. The scopes for these contracts were substantially the same for maintenance dredging. However, these scopes were limited to a single Federal navigation project, within the District’s area of responsibility and only one Task Order was issued to each of the IDIQ Contracts. These contracts were awarded with bid items for the dredge and associated equipment. Upon award of the SATOC, individual task orders were issued for the specific work requirements and necessary equipment. The non-consolidated contract project bore the full contract mobilization/demobilization costs as identified in Table 1.

Table 1 – Previously Non-Consolidated Requirements Contract Project Total

Contract Cost

CT Admin Cost

Cost Engineering

Operations/ Engineering (to include travel costs)

Mobilization/ Demobilization

Cost

W91278-16-D-0041 Mobile $8.0M $24K $5,000 $9,500 $157K

W91278-17-D-0002 Mobile

$8.0M $24K $5,000 $9,500 $1.1M

W91278-17-C-0029 Gulfport $8.2M $24K $5,000 $10,000 $2.3M

In addition, in Table 4, further breakdown of administrative costs is given.

The projects in Table 2 are individual task orders issued under one consolidated SATOC covering Mobile, Pascagoula, Pensacola, and Panama City. The scopes for these contracts were substantially the same for maintenance dredging as a non-consolidated contract. However, the scope was not limited to a single Federal navigation project but included any Federal navigation channels within the District’s area of responsibility. Following award of the contract, individual task orders for each Federal project were issued with bid items for hourly rates for the specific work requirements, the dredge and associated equipment and estimated hours. The initial task order bore the mobilization cost, with subsequent task orders bearing a much lower cost for bar-to-bar mobilization. After completion of the final task order work, demobilization is paid under the final task order.

None of the deep draft channels have been performed or are able to be performed by small businesses. Consolidated contracts enable the Mobile District to successfully address and respond to the maintenance needs of the navigation projects and promptly fund the project sites as needed throughout the contract period. The work tasks were scheduled within a given fiscal year based on available funds and critical needs precipitated by unknown/unplanned events. The contractors were able to effectively respond to the task orders and specific requirements to accomplish the work.

Table 2 – Previously Consolidated Requirements

Contract Project Total Contract Cost

CT Admin Cost

Cost Engineering

Operations/ Engineering

Mobilization/ Demobilization

Cost W9127823D0057 - W9127823F0270

Mobile $17,787,550.00 $4,500

$3,000 $3,000 $140,000.00

W9127823D0057 - W9127824F0105 Pascagoula

$1,010,362.69 $4,500 $3,000 $3,000

$0.00

W9127823D0057, W9127824F0081 Pensacola $1,201,250.00 $4,500

$3,000 $3,000 $10,000.00

W9127824D0067- W9127825F0021

Mobile $2,465,000.00 $4,500

$650,000.00

W9127824D0067- W9127825F0030

Gulfport Harbor $1,496,113.99 $4,500

$3,000 $3,000 $0.00

W9127824D0067- W9127825F0071 Pascagoula $1,496,113.99 $4,500

$0.00

f. Rationale for Consolidation:

(1) To be determined necessary and justified, the benefits of the consolidated acquisition must substantially exceed the benefits that would be derived from alternative contracting approaches that involve a lesser degree of consolidation. Such benefits may include qualitative or quantifiable cost savings or price reductions as well as other benefits, regardless of whether quantifiable in dollar amounts, to include quality improvements that will save time or enhance performance or efficiency, reduce acquisition cycle time, and result in better terms or conditions. Benefits that are quantifiable are considered substantial if they meet the dollar amounts set forth in FAR 7.107-2(d). If the quantifiable benefits do not meet these thresholds, the approving authority may determine that consolidation is necessary and justified if critical to the agency’s mission success and the procurement strategy provides for maximum practicable participation by small business. For this procurement, the quantifiable benefits of consolidation exceed the standard set forth in FAR 7.107-2(d).

(2) The Mobile District’s decision to consolidate the requirements under this proposed solicitation is primarily based on the anticipated cost savings of mobilization and demobilization costs. Utilizing an unrestricted IFB process will allow the Mobile District to obtain binding pricing on the required dredging services and will enable the district to engage the successful contractor in javascript:;

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a timely manner to execute requirements for harbor dredging in Alabama, Mississippi, and Florida.

The mobilization/demobilization of a dredge into a project area is a substantial cost in a Federal navigation channel maintenance dredging project. Consolidation allows the Government to realize greater savings by using a single contractor’s dredge equipment to maintain a group of project areas concurrently, which reduces the cost of moving dredges unnecessarily into and out of the areas, as only one mobilization/demobilization will be allowed under the contract. If the mobilization/demobilization costs are not combined as they are in a consolidated procurement, the overall price to perform the work will increase. With limited funds available for dredging work, the mobilization/demobilization costs subtract from the dredging budget which reduces the amount of actual dredging that can be accomplished. A reduction in dredging work can compromise safe navigational access to these channels, increase vessel delays, increase transport costs, and increase ship traffic delays.

Additionally, consolidation of these dredging areas allows synchronization of operations by improving the coordination required to efficiently schedule dredges, accommodate environmental challenges, and restore project depths in the channel areas. Lastly, since there are very few hopper dredge contractors available, the same contractors typically compete for the same dredging contracts around the nation. A contractor that wins a contract for a certain geographical area will have a significant advantage over future competitions in that area due to mobilization/demobilization costs.

Table 3 below represents savings to the government for mobilization/demobilization. The average cost of mobilizing a hopper dredge from project to project is $8,250 per hour. The total transit time from project to project (Bar-to-Bar mobilization from Mobile Harbor to Gulfport Harber to Pascagoula Harbor to Pensacola Harbor to Panama City Harbor) for the proposed consolidated SATOC contract would be 24 hours or $198,000 with the average mob/demob costs based on examples is $871,400, which would cost $4,357,000 for 5 stand-alone “C” contracts. Using a consolidated SATOC contract would provide a savings of $3,287,600 across an average of 5 Task orders.

Additional savings are depicted in Table 4 Administrative Costs below, multiple solicitations can also significantly increase contract costs due to the total procurement costs. The cost of a SATOC Contract with five Task Orders issued is $89,500, where the cost of 5 Stand-Alone “C” Contract costs $197,500. The saving achieved by awarding a SATOC contract with five task orders represents a savings of 54.7% or $108,000.

The use of an IDIQ contract is appropriate IAW FAR 16.50l -2(a), when exact times and/or exact quantities of future deliveries are not known at the time of award. FAR l6.504(b) indicates that the Contracting Officer may use an indefinite-quantity contract when the Government cannot predetermine, above a specified minimum, the precise quantities of supplies and services that the Government will require during the contract period, and it is inadvisable for the Government to commit itself for more than a minimum quantity. Accordingly, the above justification falls in line with consolidating these dredging efforts.

3. Applicable Statutes/Regulations: 15 U.S.C. § 657q, FAR 7.107-2, and AFARS 5107.170.

4. Results of Market Research: To ensure that small business concerns were given appropriate opportunities to participate as prime contractors and subcontractors in Federal procurements, the Mobile District conducted market research that supplemented the District’s knowledge of capabilities based on prior similar acquisitions. A Sources Sought Notice, W9127825B0001, was posted on SAM.GOV on 17 January 2025 with a closing date of 3 February 2025. Interested contractors were requested to submit a statement of their capabilities, information regarding their business size and category for future procurements for fiscal year 2025 for the rental of dredging equipment to perform maintenance dredging of inland river systems as well as coastal harbors, rivers, and bays. The notice indicated that the future requirements for rental dredging equipment would be for different size categories of dredges and for different types of dredges as described below to include the following:

Two requirements will be for hydraulic, cutterhead dredges. Required minimum pump discharge diameters will be between 24 and 30 inches measured as the inside diameter of the discharge side of the main dredge pump with minimum horsepower applied to the main pump of 2400/5000 respectively.

One requirement will be for trailing suction hopper dredges with a minimum hopper capacity of 3600 cubic yards. All the above requirements must be complete with crew, management staff and support equipment including pipelines, booster pumps, tugs, various other floating plants as would normally be expected to support a large dredging operation.

The requirement was posted with a NAICS code of 237990 and size standard $37 million.

Great Lakes Dredge and Dock Company LLC, Manson Construction Co., and Weeks Marine Inc. were the three large businesses to respond to the market survey. The Sources Sought did not specifically request contractors to respond whether consolidating these requirements would affect their ability to bid on the project. However, historically, contractors will respond to these notices indicating this type of concern and provide a rationale supporting their claim. On April 21, 2025 all three (3) contractors were contacted via email asking if there were any questions or concerns regarding whether consolidating requirement will affect their abilities to bid on the project. Out of the three only Great Lakes Dredge and Dock Company responded with zero concerns or questions.

As stated above, a hopper dredge is deemed necessary and appropriate to effectively and efficiently perform annual maintenance dredging at various shoaling locations of the Federal navigation projects of Mobile, Pascagoula, Gulfport, Pensacola, and Panama City Harbors, and therefore is required to satisfy the minimum needs of the Agency. Given that there was no response from a small business that is determined to be capable, the rule of two has not been met. Therefore, the procurement of this requirement will be competed on an unrestricted basis.

The Mobile District annually bids one hopper contract. Solicitations for these dredge projects have typically yielded three bidders due to the limited pool of contractors capable of meeting the equipment requirements.

Based upon procurement history, the targeted pool of contractors is fully capable of performing the consolidated requirement and their ability to compete will not be negatively impacted by this approach. Based on the above market research, and extensive knowledge of the major players within this industry, the Mobile District is confident that no small businesses exist that can perform the requirement whether or not it is consolidated. Therefore, based on this analysis, the benefits of consolidation outweigh any negative impact to small business competition and enhances competition given the magnitude of the project and the limited pool of contractors.

5. Alternate Contracting Approaches Considered and Rationale for Rejection: The Mobile District considered alternative contracting approaches, including multiple consolidated SATOCs (one per harbor), and to a lesser degree, multiple stand-alone “C” contracts. Multiple SATOCs would be nearly equivalent to using a “C” contract for each harbor, given that the scope of this award would cover five harbors: (1) Gulfport, MS; (2) Pascagoula, MS; (3) Mobile, AL; (4) Pensacola, FL; (5) Panama City. The stand-alone contracts, one for each harbor, is rejected due to the mobilization/demobilization and scheduling impacts identified below. A Multiple Award Task Order Contract (MATOC) approach is not considered as a viable alternative because it would not represent a lesser degree of consolidation and would not achieve the mobilization/demobilization savings possible with a single contractor.

a. Alternative: Stand-Alone “C” Contracts: The District considered the award of multiple stand-alone “C” type contracts to perform the required maintenance dredging work. While this approach could provide a lesser degree of consolidation, or no consolidation at all if individual contracts are awarded for single requirements, the disadvantages of the “C” type contracts substantially exceed the advantages of consolidation for the reasons outlined below. As discussed in Section 4 – Results of Market Research, there is a very limited known pool of contractors who are capable of performing the required scope of work, and most of those contractors are engaged in other maintenance dredging operations nationally, so competition can be very limited.

(1) Quality: While “C” contract competitions generally give the Government the opportunity to avail itself of a wider range of potential contractors for each project, that does not necessarily hold true for dredging because of the limited contractor base and capacity from which to pull. As indicated earlier, historically only three contractors have responded to IFBs for the maintenance dredging IDIQ SATOCs. Moreover, as also noted above, the iterative process of working with one contractor under a SATOC tends to generate a more thorough shared understanding between the contractor and Government for the Government's requirements and procedures.

(2) Acquisition Cycle: Civil works funds are not tied to a specific fiscal year appropriation and is not a substantial factor in determining requirements; however, while the funding does not generally expire, if they are not generally expended, the following fiscal years may see a reduction in overall civil works funds available to the district. It is beneficial for the district to have a contract vehicle that allows expedient funding for task order awards. The District addresses this budgetary uncertainty with regular IDIQ acquisition actions to create capacity to accomplish a customer’s known requirements, and to respond to those that arrive on short-notice.

(a) In addition to building capacity, the use of task orders under a SATOC streamlines the procurement process under a regimen that is significantly more expeditious than a “C” contract scheme. Specifically, task orders under a SATOC do not require advance notice, voluminous solicitations and proposal submissions, and the evaluations can be streamlined. As compared to awarding a stand-alone “C” contract, it is estimated that placing task orders under a SATOC reduces acquisition time from 140 to 30 days on average for each project.

(b) In addition to the quality benefits resulting from the iterative process of negotiating and executing maintenance efforts, contractors are in a stronger position to stabilize relationships with their bonding company(s) and subcontractors when awarded larger, more predictable, contracts thus reducing risk to the Government during execution. Contracts for dredging have a unique advantage in that the proposed rates remain constant throughout the life of the contract. The

Government knows the exact cost of the effort and thus the negotiations are based upon level of effort and not a fluctuating cost of various labor rates. Additionally, SATOC contracts have the unique advantage in that after receipt of proposals, the Government has the ability to virtually conduct continuous scope and cost negotiations to arrive at the best scope and cost for the work in an efficient manner. In the formal acquisition process for a “C” contract, the ability to react quickly and as needed by mission requirements cannot be accomplished in the same expedited manner.

Information flow is restricted to formal Requests for Information (RFI) with responses provided to all potential offerors. Answers to RFIs often times result in more RFIs and the process drags on. As a result of this rigid process for the advertisement of MATOCs and “C” type contracts, it is much more time consuming than a SATOC advertisement.

(3) Terms and Conditions: Other than request for proposal (RFP) requirements and proposal submissions, there is essentially no difference between the contractual terms and conditions for a construction or repair project executed under a SATOC or a “C” contract. However, in accordance with Sec 835 of the NDAA of 2017, task orders are not subject to Agency or Government Accountability Office (GAO) protests under $25M. Conversely, all “C” contracts, regardless of value, are subject to protest for any number of reasons. The use of “C” contracts thus put procurement and award schedules at greater risk of delay than task orders under SATOCs.

(4) Mobilization and Demobilization Cost Savings: The average bid price for mobilization/demobilization for a hopper dredge based on the three unconsolidated contracts and two consolidated contracts listed above is $871,400.00. Aside from the initial mobilization/demobilization costs, the consolidated contract also includes mobilizing the entire dredge and plant from project to project at an hourly rental rate. The average cost of mobilizing a hopper dredge from project to project is $8,250.00 per hour. The total transit time from project to project (Bar-to-Bar mobilization from Mobile Harbor to Gulfport Harbor to Pascagoula Harbor to Pensacola Harbor to Panama City Harbor) for the proposed consolidated SATOC contract would be 24 hours. A comparison chart with the mobilization/demobilization costs associated with a stand-alone “C” Contract and a consolidated SATOC is presented in Table 3.

Table 3 – Mobilization/Demobilization Costs

Alternatives Mobilization Cost Bar-to-Bar Cost Total Cost Savings

C Contracts (one for each harbor)

5 x $871,400= $4,347,000 $0.00 $4,357,000.00 N/A

1 SATOC

Consolidated

(Recommended Plan) $871,400.00 24hrs x $8,250.00 =

$198,000.00 $1,069,400.00 $3,287,600.00

Therefore, on a typical year of dredging using the consolidated contract, the Government would save $3,287,600.00 on mobilization and demobilization costs alone, which represents savings of 10.9% of the contract award.

(5) Administration Time and Costs: The administrative costs of issuing task orders under a single SATOC are significantly less than the costs of awarding multiple “C” contracts or multiple SATOCs (one for each harbor). Each additional “C” contract or SATOC would also add to the administration time, as it is much easier for the Contracting and Operations Divisions to administer one SATOC and subsequent task orders versus multiple contracts.

Table 4 illustrates the average administration costs for the District to award a single SATOC versus awarding five stand-alone “C” contracts. The applicable task order cost for a SATOC is included. These costs are based on standard labor rates developed by Contracting for fiscal year 2023 procurements, along with historical average procurement support costs for Cost Engineering Division, Operations Division, and Engineering Division for acquisition coordination document review, IGE development, site visit attendance, and related document preparation, travel, and administration.

Table 4 – Administrative Costs Contract Contract Labor Travel Total

SATOC

Contract

Contracting IFB $22,500.00 $- $22,500.00 Cost Engineering $5,000.00 $- $5,000.00 Operations/Engineering $7,500.00 $2,000.00 $9,500.00

Total Cost to Award 1 SATOC: $37,000.00

SATOC

Task Order

Contracting Task Order $4,500.00 $- $4,500.00 Cost Engineering $3,000.00 $- $3,000.00 Operations/Engineering $3,000.00 $- $3,000.00

Total Cost to Award 1 SATOC Task Order: $10,500.00 Total Cost to Award 5 SATOC Task Orders: $52,500.00

Total Cost to Award 1 SATOC and 5 Task Orders: $89,500.00

“C” Contract

Contracting IFB $22,500.00 $- $22,500.00 Cost Engineering $5,000.00 $- $5,000.00 Operations/Engineering $10,000.00 $2,000.00 $12,000.00

Total Cost to Award 1 Stand-Alone “C” Contract $39,500.00 Total Cost to Award 5 Stand-Alone “C” Contracts $197,500.00

As illustrated in Table 4, the total procurement costs for the consolidated SATOC contract and five

(5) task orders (one per harbor) would be approximately $89,500.00 while the procurement cost for awarding five “C” contracts would be $197,500.00. The savings achieved by awarding a SATOC contract with five task orders, in the amount of $108,000.00, represent a savings of 54.7% of the administration cost of award.

(6) Conclusion: In summary, the savings in mobilization/demobilization for a consolidated SATOC total $3,287,600.00. In addition, the Government will also save an estimated $108,000.00 in administration costs. Total anticipated cost savings of the consolidation approach equals $3,287,600.00 in mobilization/demobilization costs plus administrative costs of $108,000.00), or 10.9% of the estimated contact value, and meets the requirements of FAR 7.107- 2(d)(1)(i). Additionally, multiple SATOCs or “C” contracts would add to the acquisition timeline and increase administration time. A consolidated SATOC provides the best combination of competitive procedures, timely acquisition, cost efficiency, quality, and capable prime contractors to execute maintenance dredging.

6. Bundling Analysis:

a. Definition of Bundling. FAR 2.101 defines bundling as consolidating two or more requirements for supplies or services, previously provided or performed under separate smaller contracts, into a solicitation for a single contract that is likely to be unsuitable for award to a small business concern due to: (i) the diversity, size, or specialized nature of the elements of the performance specified; (ii) the aggregate dollar value of the anticipated award; (iii) the geographical dispersion of the contract performance sites; or (iv) any combination of the factors described in paragraphs (i) through (iii) of this definition. "Separate smaller contract" as used in this definition, means a contract that has been performed by one or more small business concerns or that was suitable for award to one or more small business concerns.

b. Applicability of Bundling Principle. This acquisition does not meet the definition of bundling because it does not attempt to consolidate “two or more requirements for supplies or services, previously provided or performed under separate smaller contracts, that are likely to be unsuitable for award to a small business concern”. The requirements being consolidated have all been previously advertised as an Unrestricted IFB for consolidated or unconsolidated SATOCs and performed by large businesses.

c. Definition of the Competition in Contracting Act (CICA) Bundling Principle: This principle, as developed by the Government Accountability Office (GAO) case law, focuses on whether the combined requirement (new, old, or otherwise) restricts competition, and whether the agency is consolidating or bundling a new requirement unnecessarily. To justify CICA Bundling the agency must show "a reasonable basis for why the bundling is necessary to meet the agency need." (Vantex Serv., Inc., B-29041 5, Aug 8, 2002, and Outdoor Venture Corp., B-299675; B- 299676, Jul 19, 2007.)

d. Applicability of CICA Bundling Principle: This procurement is intended to be a full and open, unrestricted IFB. Bundled procurements combine separate requirements into one contract;

thus, they have the potential to restrict competition in violation of CICA by excluding firms that can provide only a portion of the bundled requirement. However, substantial cost savings achieved through the reduction of duplicative efforts and operational efficiency can be a reasonable basis for restricting competition where requirements are bundled. As demonstrated in the previous sections, substantial cost savings will be accomplished through consolidation of these requirements. These projects have been consolidated in the past into an IDIQ contract. This action does not unreasonably restrict competition to small businesses. As stated above, no small businesses responded to the Market Research, or are currently known, that are capable of performing this work. There are four known dredging contractors with the ability and equipment to perform this work, all of which are large businesses and who historically bid on contracts for work within Mobile District. These contractors are The Dutra Group, Great Lakes Dredge and Dock Co., Weeks Marine and Manson Construction Co. The District fully expects these contractors to bid on this contract because the scope of work is the same as it has been in past years. Additionally, the District has no information nor has received any comments from the dredging community to suggest that placing each navigation project under separate contracts, or regrouping them in some other manner, would create interest and allow other contractors to perform this work.

7. Considerations, facts, and reasoning supporting the determination: All facts, considerations and rationale have been covered previously in the findings. The Small Business Coordination Record (DD Form 2579) will be coordinated with the Contracting Officer, Chief, Office of Small Business Programs, and SBA Procurement Center Representative once this document is finalized.

8. Summary: Although this unrestricted IDIQ SATOC constitutes consolidation in that it combines construction at two or more discrete sites in one contract, this approach provides the best combination of competitive procedures, timely acquisition, cost efficiency, quality, and capable prime contractors to execute maintenance dredging for the Mobile District’s deep draft navigation channel requirements. The quantifiable benefits of consolidation, $3,277,600.00 or 10.9% of the estimated contract value, exceed the standard in FAR 7.107-2(d)(1)(i) and are further supplemented by the qualitative benefits. Stand-alone “C” contracts were considered but would result in significantly higher costs and increased acquisition cycle times. Additionally, it is significantly less burdensome for the District’s Contracting and Operations Divisions to administer one SATOC versus numerous “C” contracts. The findings of the market research and the documentation provided herein support the conclusion that consolidation of requirements is both necessary and justified based on sound business judgment in view of the size, complexity, and potential number of efforts to be executed. The consolidated approach provides substantial quantitative and qualitative advantages that far outweigh those of an approach that utilizes a lesser degree of consolidation.

Attachment 1 – Deep Draft Navigation Project Locations

DEPARTMENT OF THE ARMY

U.S. ARMY CORPS OF ENGINEERS, MOBILE DISTRICT

DETERMINATION AND FINDINGS

REQUEST FOR CONSOLIDATION

W9127825BA002

INDEFINITE DELIVERY INDEFINITE QUANTITY (IDIQ) SINGLE AWARD TASK

ORDER CONTRACT (SATOC) FOR MAINTENANCE DREDGING, HOPPER DREDGE

AND ATTENDANT PLANT FOR DREDGING IN ALABAMA, MISSISSIPPI, AND

FLORIDA

Upon the basis of the findings above, I hereby determine, pursuant to the authority of FAR 7.107- 2, 15 USC § 657q, and Army Federal Acquisition Regulation Supplement 5107.107-2(b)(ii) “Consolidation,” that the proposed consolidation of two or more discrete construction projects for the Department of Defense within the Mobile District is both necessary and justified.

Carl Wade Date Chief, Contracting Division

CESAM-CT

Fillable_field: Controlled by: Army

Controlled by: USACE Mobile District

CUI Category: General Procurement and Acquisition

Distribution/Dissemination Control: FED ONLY

POC: Emily Ortiz 251-694-4107