MVM_Approved_J&A_DryDock_Redacted.pdf

Control No. MVM-19-02

Justification and Approval

For

Other Than Full and Open Competition

The following Senior Contracting Official, Atlanta (SCO-ATL) signature indicates Concurrence with the contents of this Justification:

SCO-ATL

Counsel:

Date:

{See Signature)

JUSTIFCATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Agency: The responsible contracting activity is the U.S. Army Corps of Engineers (USACE), Memphis District Contracting Office (MVM), 167 N. Main Street, Memphis, TN 38103-1894.

2. Description of the Action: This was a new requirement for a sole source Firm-Fixed-Price services contract with Big River Shipbuilders, Inc. to retrieve a partially sunk dry dock at McKellar Lake at Ensley Engineer Yard (EEY), 2915 Riverport Road, Memphis, Tennessee. The contract was fully funded with FY 19 O&M funds. On 4 June 2019, MVM received verbal approval from the Senior Contracting Official-Atlanta to award a new contract pursuant to the authority of FAR 13.501(a), Sole Source Acquisitions, under the circumstance of unusual and compelling urgency. The contract was funded with FY 19 O&M funds.

3. Description of Supplies/Services: This was a non-personal services contract to provide for the retrieval of an approximately 320 ft. by 106 ft. by 28 ft. floating dry dock, number 5801, located at EEY, 2915 Riverport Road, Memphis, TN 38109. The requirement was necessitated due to the partial sinking of dry dock 5801 in McKellar Lake. A sustained portion of the dry dock remained floating; however, retrieval had to be performed as soon as possible or risk greater damage and cost to recover and repair. MVM provided Big River Ship Builders a written notice to mobilize to EEY on May 31, 2019, and a written notice to proceed on June 14, 2019 to retrieve Dry Dock 5801. Purchase Order W912EQ19P0059 with a total value of $1,393,995.22 was awarded as a result. The vendor furnished all plant, labor, materials and equipment to retrieve the partially submerged dry dock and maintained it in a floating position. These services are customarily used by the general public for the purposes of retrieval of submerged or partially submerged vessels and, as such, are commercial services pursuant to FAR 2.101. Key performance objectives were mobilization to site, retrieval plan, dive plan, site safety plan, dry dock retrieval, and demobilization from site. No options were included in this purchase order.

The period of performance was thirty (30) calendar days after receipt of notice to proceed.

4. Authority Cited: Simplified Procedures for Certain Commercial Items, 41 U.S.C. 1901 as implemented by FAR Subpart 13.501(a), Sole Source Acquisitions, under the circumstance of Unusual and Compelling Urgency.

5. Reason for Authority Cited: The US Army Corps of Engineers has statutorily assigned missions, which include flood risk management and navigation on the Mississippi River, for the benefit of the public. Critical to this mission is MVM's ability to maintain and repair its vessels and floating equipment on an as needed basis. MVM's operation of Dry Dock 5801 is integral to MVM's ability to carry out this mission.

a. Background: EEY is a full-service marine maintenance facility designed to support the navigation and flood risk management missions of the USACE Mississippi Valley Division as well as maritime support for other Districts and agencies. Vessel maintenance is one of the five service areas provided by EEY. Dry Dock 5801 is the largest dry dock on the Mississippi River north of Baton Rouge, LA. The dry dock is capable of servicing vessels over 300 ft. and up to 3,200 Long tons and is used in a regional capacity supporting both USACE and other governmental agencies. The dry dock is also used for USACE assets, which support the Agency's flood risk management and navigation missions. It is also a significant fee generator for USACE through dry dock and repair of other agency's vessels. Historically, Dry Dock 5801 generates an average of $20,000 per month.

On Friday 31 May 2019, during operations to offload the Vicksburg District's Mat Sinking Barge, the riverside of Dry Dock 5801 suddenly began to sink uncontrollably until it hit river bottom.

The landward side of Dry Dock 5801 remained partially above water. Ten personnel had to be rescued from the water and were all assessed and cleared by the staff nurse. The Mat Sinking Barge was removed without damage, but the partially submerged Dry Dock 5801 could not be refloated. While partially submerged, Dry Dock 5801 remained susceptible to increased water damage and presented a potential navigational hazard for vessels using the EEY dock.

Dry Dock 5801 was scheduled to receive a new vessel for repair, the MVK Mat Sinking Unit Mooring Barge, from, 1 June thru 30 June 2019. EEY did not have the capacity to perform this work without Dry Dock 5801.

On Monday 3 June 2019, The Memphis District Contracting Chief requested verbal approval from SCO-ATL to use other than open full and competition using Sole Source Acquisitions, under the circumstance of Unusual and Compelling Urgency exception as implemented by FAR 13.501(a) to procure the necessary retrieval services to recover and repair Dry Dock 5801. On Tuesday 4 June 2019, MVM received SCO-ATL verbal approval to negotiate and award a purchase order for dry dock retrieval as noted in paragraph two.

According to the Mississippi Valley Division Acquisition Planning Guide, standard procurement action lead time for a competitive service of this magnitude is 60 to 90 days. However, this standard assumes a complete, actionable requirements package. Developing the PWS, IGE, and obtaining RSCA approval could easily add another 30 days to the process. The lead time required for a competitive contract was untenable due to the risk of further sinking and damage to the dry dock, increase in operational budget to monitor the dry dock, and loss of fee generation from other agencies using the dry dock.

b. Justification: The potential for increased damage to the dry dock rose significantly each day it remained partially submerged, along with a reasonable expectation of additional damage as the Mississippi River levels continued to rise. The required performance dates were as soon as possible and the normal lead time listed in paragraph 5a. was unacceptable. Any unnecessary delay in performance by not limiting sources would have caused unacceptable risk and injury to the Government via additional damage to the dry dock. An immediate retrieval was necessary to prevent further damage to the dry dock. If not retrieved as soon as possible, the dry dock would have continued to incur damage to interior systems exposed to the water and there would be a higher chance the vessel could sink completely, increasing both the costs and time to recover, assess, tow, and repair it. The necessary recovery effort required the mobilization of multiple cranes normally not in the immediate area, which would usually take up to a week even for a contractor with immediate capacity. Fortunately, Big River Shipbuilders had the technical capability in the immediate area and the capacity to immediately mobilize it, as well as available infrastructure and subcontractor support to complete the requirement in the least amount of time.

The time required to procure the necessary services using typical full and open solicitation presented unacceptable cost risk and injury to the Agency.

c. Alternatives: The USACE Memphis District does not have the manpower, technical capability, nor equipment to self-perform the dry dock retrieval. Therefore, recovery by USACE personnel was not a viable alternative.

MVM considered using full and open competition by issuing a combined synopsis/solicitation, but the time inherent in this alternative still presented unacceptable risks. The longer the dry dock was partially submerged, the more potential there was for greater damage, additional sinking, and additional complexity added to the retrieval effort. With time being the most critical factor, the delays associated with posting, response, and award, along with further potential delays associated with an awardee's mobilizatio2n and relocation of equipment presented a serious risk of further sinking and avoidable damage to Dry Dock 5801. Additional sinking would also negatively impact the difficulty and cost to retrieve the vessel. Additionally, these delays would also effect the total length the dry dock is out of service, which would negatively impact MVM's ability to support USACE's flood risk management and navigation mission, as well as fee generation through servicing other agency vessels. As such, using a sole source acquisition for this immediate requirement was appropriate to avoid serious injury to the Government.

d. Impact: The operational loss of Dry Dock 5801 had immediate cost impacts. The daily rate for Dry Dock 5801 is $758 per day, which amounts to approximately $240,000 per year in dry dock fees. In addition to the direct fees, there are almost $2.5M in known repair fees that MVM and USACE could potentially lose over the next 14 months if Dry Dock 5801 were allowed to remain inoperable. There are also service and repairs scheduled for other agency vessels and USACE assets, without precise, known repair costs. However, based on historical costs and dry dock timeframes the fees and outsourcing costs associated with this un-definitized work would be approximately $1M.

There were also potential negative cost and mission impacts should any emergency repairs be required for USACE assets. Vessels requiring emergency repair would have a longer timeline out of service while MVM locates appropriate resources and awards contracts, instead using internal assets. Lastly, monitoring the partially submerged dry dock has increased personnel costs. Two, two-person crews working 12-hour shifts continued 24-hour a day surveillance.

Delays to the retrieval efforts would have exacerbated these costs.

6. Efforts to Obtain Competition: After determining the requirement would necessitate an emergency procurement, the contracting officer began market research to identify technically capable contractors who were interested and capable of immediate response and mobilization.

The research identified only two potential contractors technically capable of completing the work, Big River Shipbuilders and Wepfer Marine, Inc. The Contracting Officer waived the synopsis in accordance with FAR 5.202. The use of unusual and compelling urgency still required soliciting as many sources as practicable; therefore, two contractors were contacted but only one had available capacity to begin work immediately. As explained in paragraph 8, Wepfer Marine, Inc. was not capable of providing a firm-fixed-price quote to meet the agency's needs.

7. Actions to Increase Competition: The dry dock retrieval is a one-time requirement. The Memphis District Contracting Office continues to solicit similar non-emergency requirements using full and open competition from various sources. Additionally, the Memphis District Contracting office issued a sources sought for the subsequent towing and repair of the dry dock and will award the towing and repair requirement using full and open competition. Three vendors submitted capability statements in response to the sources sought. Two were small businesses and one was an 8(a) firm with a mentor-protege agreement with a large business.

All three were deemed capable of performing the towing and repair requirement. As a result, the solicitation was issued as a 100% set aside for small business.

8. Market Research: During the sinking of Dry-Dock 5801, The Contracting Officer and Contracting Officer Representative contacted several vendors in support of retrieving the dry dock from the McKellar Lake. Search results concluded there were only two vendors within the area that could respond to this request (Wepfer Marine and Big River Shipbuilders). Both vendors proceeded to Ensley Engineer Yard to assess the operations of retrieving the dry dock.

Wepfer Marine responded they were not capable of providing a firm fixed price quote to complete the requirement due to its complexity. As such, they were not considered capable of