BentleyJARedacted.pdf

HNC-14-8310-F

PROCUREMENT SENSITIVE – FOR OFFICIAL USE ONLY

LIMITED SOURCES JUSTIFICATION AND APPROVAL

1. Contracting Agency: United States Army Engineering and Support Center (CEHNC) located at 4820 University Square, Huntsville, AL 35816-1822.

2. Description of Action: CEHNC is requesting approval to award a sole source General Services Administration (GSA) Federal Supply Schedule (FSS) Blanket Purchase Agreement (BPA) to Bentley Systems, Inc (GS-35F-0453L). In accordance with (IAW) FAR 8.405-6(c)(1), this acquisition is being conducted under the authority of the Multiple Award Schedule Program.

The resulting award, estimated at $40M, will consist of a single term starting from date of award and continuing for five years with annual reviews as required by FAR 8.405-3(e). Award of the BPA will be issued pursuant to FAR 8.405-3 Blanket Purchase Agreements. It is reasonably expected that, based on the nature of the supplies sought, and on market research, Bentley Systems, Inc. (hereafter referred to as Bentley) will include only commercial items for call orders placed under this BPA.

The proposed BPA will replace BPA Number W912HZ-08-A-0032, which was issued 19 September 2008 with a not to exceed (NTE) $35M ceiling amount for a five year performance period. Please see paragraph 10 for more details related to the procurement history and background of the legacy BPA.

3. Description of Supplies/Services: The resulting BPA will provide CAD/BIM software and software support and training services for USACE and its customers. CEHNC intends to negotiate for volume discounts and enterprise agreements for agencies desiring to further consolidate their requirements.

The estimated $40M ceiling was developed based upon the historical obligations on the previous contractual arrangement. Historical obligations totaling an approximate $5.42M per year ($27.1M total) was made against the previous contractual arrangement over a 5-year period.

Based upon the government estimate, the projected usage for the Bentley software products such as MicroStation, ProjectWise, gINT, and Bentley Building System, is anticipated to grow at an approximate annual cost of $217K. This BPA will add an additional requirement (Training and Implementation Support) that was not historically acquired through the previous contractual arrangement. The Training and Implementation Support will allow users to access online training modules to increase proficiency in Bentley's software products. The increase in obligations is anticipated to be proportional to its increase in software usage. Estimated cost for the Training and Implementation Support is approximately $1.96M. Accounting for the growth of software products usage and corresponding training, the estimated required capacity for year one of the BPA is $7.38M. The usage of these products and associated training is anticipated to grow at a rate of 4% each year thereafter. At the calculated compounded increase over a 5 year period, the total estimated need totals approximately $40M.

The CAD/GIS Technology Center in the Information Technology Laboratory (The Center) is responsible for providing and maintaining tools for use by USACE and its customers for products and services in the CADD, GIS, Facility Management, Infrastructure and Environmental areas. The Center previously maintained a BPA with Bentley to provide CAD and BIM software, software support and training to USACE and its customers. The previous BPA with Bentley expired 18 September 2013. The products and services provided by this BPA are mission critical. There is an ongoing requirement to support the USACE Military and Civil Works engineering design program with the products and services offered by Bentley, but the exact order quantities and delivery requirements are not known in advance and may vary considerably.

4. Authority Cited: The authority for this sole source acquisition is FAR 8.405-6(a)(1)(i)(B);

Only one source is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized.

5. Reason for Authority Cited: As discussed below, the proposed procurement meets the criteria for exclusion from full and open competition under the statutory authority cited above.

There are currently three major vendors (USACE: Bentley, Autodesk, and Graphisoft) that supply the full spectrum of CAD/BIM products and services. However, each of these vendor’s suite of products is proprietary in nature. Interoperability or exchange of information between each vendor’s CAD/BIM applications is prohibitively limited and models developed in one platform cannot be viewed or edited in another platform. So, it is not feasible to mix the product lines of different vendors and maintain 100% functionality.

Within USACE, approximately of the deployed CAD/BIM software is Bentley. Converting from Bentley to one of the other vendor’s proprietary product lines would amount to abandoning all past investments in training, file and database development, and other related implementation costs. Also, it would require bearing those costs anew and result in considerable disruption in agency performance. The other approximately of deployed CAD/BIM software is from other vendors with proprietary product lines like Bentley that must continue to use its own CAD/BIM software deployment as no current open data standards are established.

As an example, there are approximately of Bentley’s flagship CAD product, MicroStation, deployed and in use throughout USACE. The labor cost alone for retraining these users on another company’s system for a basic two week fundamental course is estimated at A two week basic training course would not allow the typical user to reach the productivity level they have with their current system. To reach that level of productivity it would require months or even years. In addition, there are approximately

BIM users in the USACE that would require substantially more training than a two week fundamental course. Typically, a BIM user would require an additional of training in his/her particular discipline, e.g., architectural, mechanical engineering, or electrical engineering.

Converting from one company’s proprietary product line to another requires abandoning all past investments in file and database development, training, and other related implementation costs.

In summary Bentley products are proprietary in nature and are only available from Bentley.

Bentley is the only vendor that can provide all the necessary product maintenance and support.

Due to interoperability issues it is not feasible to mix the product lines of different vendors and maintain 100% functionality.

Given the current extent to which Bentley CAD/BIM software is deployed within USACE, the total cost, disruptions, and loss of institutional knowledge and productivity associated with changing vendors are not expected to be recovered through competition; therefore, a sole source BPA to Bentley is in the best interest of the Government IAW the authority cited in paragraph 4 above.

6. Efforts to Obtain Competition: As described in paragraph 5, utilizing full and open competition to fulfill this requirement is cost prohibitive and impractical. Currently, industry standards mandating interoperability among CAD/BIM software vendors within the competitive market place do not exist; therefore, each vendor’s software application remains proprietary in nature. While the need for data exchange and interoperability of data among vendors has long been realized by industry, DOD and USACE, the actual development and implementation of interoperability of tools by the vendors into their products has lagged behind. National and international organizations such as the Building Smart Alliance (an industry-based consortium of users and vendors), the National Institute of Building Science (a congressionally established public and private partnership), and the International Alliance for Interoperability (international user body) have been working to jointly develop consensus standards that will provide a level of interoperability among CAD/BIM vendors. Until these standards are developed and adopted by industry and the CAD/BIM vendors, full and open competition will not be possible.

7. Action to Increase Competition: The CAD/BIM Technology Center will continue to stay abreast of all future technological developments aimed at creating a platform neutral environment through the methods discussed in paragraph 8. Once agreement on a concept of platform neutrality is reached and adopted by industry, the U.S. Army Engineer Research and Development Center (ERDC) will promote full and open competition to the maximum extent practicable.

Bentley’s products are offered under its GSA FSS contract, GS-35F-0453L. The ceiling unit prices established on Bentley's GSA schedule have been determined fair and reasonable and reflect an aggregate discount from the standard commercial list price of Bentley's products.

However, pursuant to FAR 8.405-4, the Government intends to request and negotiate an additional price reduction for each product offered by Bentley through its GSA schedule and negotiate greater discounts per line item at the BPA level. The BPA will be reviewed annually to ensure the terms and conditions are still accurate, as well as, ensure the pricing is still fair and reasonable. To ensure the fair and reasonableness for each order against the BPA, and in accordance with FAR 8.405-4, the Contracting Officer will request additional discounts above and beyond the negotiated BPA discounts when the action is over the SAT.

8. Market Research: The CAD/BIM Technology Center completed market research on May 31, 2013. As a function of its mission, the Center stays abreast of technological developments in the trend in CAD, Computer-Aided Facility Management (CAFM), and BIM fields by evaluating technological developments and interfacing with professional and industry organizations. The Center’s goals are to monitor and influence changes in technology that may have an effect on DOD, to promote competition, and to ensure DOD’s CAD/BIM mission is being executed as efficiently as possible.

The Center routinely conducts technical evaluations of new technology to determine if it is compatible with existing USACE and DOD systems and industry standards. Participating in these efforts is a highly trained staff of subject matter experts who are focused on evaluating and developing improved CAD/BIM products and service suites.

The Center staff includes subject matter experts in the use and application of both Autodesk and Graphisoft products and services. The entire staff is Bentley-trained and proficient in its use.

Members of the staff regularly attend technical training, technical symposiums, and participate in national CAD/BIM interoperability efforts.

Bentley software is not available through Army CHESS, the Army’s designated primary source for commercial Information Technology and software. The Procurement Director, Army Computer Hardware, Enterprise Software and Solutions (PD CHESS) approved a Statement of Non-Availability for this procurement on December 23, 2013. A Goal-1 Waiver pursuant to Memorandum, Secretary of the Army, 6 June 2013, subject: Army Waiver Process for Commercial-Off-the-Shelf Information Technology (COTS IT) Procurement outside the Computer Hardware, Enterprise Software and Solutions Program was provided by HQDA- CIO/G-6 on January 17, 2014.

Bentley is the manufacturer and sole source for its product lines. No resellers exist and no small businesses can offer Bentley products.

9. Interested Sources: Interested Sources include Bentley, Autodesk, and Graphisoft.

However, as explained in paragraph 5 above, the two latter vendors are not considered viable due to the propriety nature of each vendor’s products. The cost of purchasing a whole new suite of a competitor’s CAD software and BIM applications, and the loss of institutional knowledge and productivity associated with changing vendors would be excessive for the government.

10. Other Facts:

a. Procurement History:

(1) The first large scale deployment of Bentley CAD/BIM technology in the Army and USACE resulted from a competitively awarded USACE-wide contract in the mid-1980’s. Subsequent contracts resulted in a sole source environment. No further information is available regarding the intervening contracts. The previous BPA, W912HZ-08-A-0032, was issued on 19 Sep 2008 with a $35M ceiling for a five year performance period. This BPA expired 18 Sep 2013.

(2) Competitive status of these actions.

The previous BPA was established on a limited sources basis.

(3) Authority previously used for less than full and open competition.

FAR 8.405-6, Limited Sources justification

(4) If a justification was prepared to support the procurement made before this one, a summary of the contents of paragraph 7 of the justification for that procurement and an explanation of the results.

Efforts are in progress to develop interoperability standards between all major CAD/BIM software suites. No significant changes to the interoperability of CAD software has been achieved at this point.

(5) If any prior award was accomplished by full and open competition, a detailed explanation of the changed circumstances. N/A

(6) There are no unusual patterns regarding this procurement.

(7) If a justification was prepared to support the procurement made before this one, briefly describe the circumstances justifying the buy and whether there have been any significant changes.

Bentley CAD/BIM software is proprietary and is not compatible with any other CAD/BIM software products. No significant changes have occurred to remedy this situation.

b. Acquisition data availability: This requirement is not suitable for full and open competition based upon the information provided in paragraphs 5 and 8 above.

c. Unusual and compelling urgency: N/A

d. Subcontracting Opportunities: This requirement is for supplies for which no subcontracting opportunities exist.