Germany_RMMR_JA_Redacted.pdf

Control No. NAU-19-001

FOUO

Justification for Other than Full and Open Competition

US Army Corps of Engineers, Europe District

1. Contracting Activity:

U.S. Army Corps of Engineers (USACE), Europe District (NAU), Contracting Division.

2. Description of Action:

USACE NAU intends to award a sole source bridge contract under solicitation W912GB19R0017 for the Germany and Belgium Recurring Maintenance and Minor Repair services (RMMR) requirement that is currently performed on task order W912GB-12-D- 0038-W912GB17F0009. The Government advertised the new requirement under solicitation W912GB18R00039 on the FedBizOpps website; however, after initial evaluations, no awardable proposals were received. In order to prevent a gap in service, this bridge contract is necessary to allow the Government the additional time needed to evaluate the current request for proposal (RFP) and make revisions, as necessary, to resolicit and attract adequate competition from interested qualified sources.

3. Description of Supplies/Services:

This requirement is to provide all labor, supervision, materials, and equipment necessary to provide RMMR services to Defense Logistics Agency-Energy (DLA-E) capitalized fuel facilities at Army and Air Force installations throughout Germany and Belgium for a period of three (3) months, with a thirty (30) day option period for additional services. The Government anticipates that this bridging action will provide adequate time to make necessary adjustments to the current RFP and resolicit and award a new competitive contract. The current RMMR task order (W912GB17F0009) supporting this requirement was originally awarded on 6 June 2017, with services through 6 December 2018 in the amount of $3,619,922.

On this bridge action, the contractor will be required to render the same services for work that is currently included on the current task order, W912GB17F0009:

Implementation of Contractor Plans Implementation of Recurring Maintenance and Minor Repair Services Scheduled Recurring Maintenance (Army sites) Emergency Repair Service Orders (Army sites) Emergency Repair Service Orders (Air Force sites) Unscheduled Minor Repair Service Orders (Army Sites) Unscheduled Minor Repair Service Orders (Air Force sites) TÜV and Oil Water Separator (OWS) Inspections and Tracking Annual Inspection Air Force Installations Implementation of Records Management System

Contractor Manpower Reporting

The RMMR contract vehicle provides vital capabilities to U.S. Army Europe

(USAREUR) and US Air Forces in Europe (USAFE) installations in Germany and Belgium by providing qualified fuels contractors with certified technicians to maintain systems and infrastructure through preventive maintenance and inspections, adherence to Unified Facilities Criteria (UFC), host nation requirements, and the repair of DLA-E capitalized fuel facilities to support mission requirements. The RMMR contract vehicle not only provides scheduled maintenance and inspections, routine and emergency response repairs, but also serves as the sole vehicle utilized supporting required host nation TÜV inspections for capitalized Army sites.

As previously mentioned in the above paragraphs, the replacement RMMR acquisition (RFP W912GB18R0039) has experienced unforeseen delays despite significant planning and market research conducted leading up to releasing the solicitation. Since all of the facilities covered under the RMMR contract vehicle support both training and operational requirements for ground vehicles, equipment, and aircraft, it is critical that the RMMR services are continuously provided to ensure there is no adverse mission impact.

The adverse impacts will be discussed further under Reason for Authority Cited.

The current period of performance for the RMMR task order ends on 6 December 2018. The period of performance for the proposed new contract is for three months beginning on 7 December 2018 through 7 March 2019; plus a one-month option period ending 6 April 2019. The estimated amount for the proposed contract is $520,443.21, plus $170,183.99 for Option 1, for a total estimated value of $690,627.20.

4. Authority Cited:

10 United States Code 2304(c)(1) as implemented in Federal Acquisition Regulation (FAR) 6.302-1(a)(2), Only one responsible source and no other supplies or services will satisfy agency requirements. Specifically, sub paragraph (iii) services are deemed to be available only from the original source for the continued provision of highly specialized services and 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, and (b) unacceptable requirements.

5. Reason for Authority Cited:

The US Army Corps of Engineers, Europe District (CENAU), awarded the current RMMR requirement as a task order W912GB17F0009 to contractor Environmental Chemical Corporation (ECC) under W912GB-12-D-0038. The period of performance was initially awarded for twelve months, but the provisions of FAR 52.217-8 were exercised to extend the task order an additional six months through 6 December 2018. CENAU conducted extensive market research and hosted an industry day in March 2018 to solicit feedback regarding various approaches to addressing unscheduled maintenance. The feedback from industry overwhelmingly supported the shift to utilizing cost reimbursable line items for unscheduled maintenance primarily due to the non-predictive nature of service orders, and that the RMMR contractor would not be responsible for the day-to-day operations and upkeep of fuel systems due to DLA- and the maintenance tasks defined in UFC 3-460-03 (Petroleum Fuel Systems Maintenance). DLA-E directly contracts for operational support of fuel facilities at Army, Air Force, and Navy sites for terminal management, operators, and operator level maintenance as defined by UFC 3- 460-03 to support each service component.

Despite utilizing a cost reimbursable approach to address unscheduled maintenance on the replacement RMMR contract vehicle and involvement of multiple large firms experienced in providing RMMR and fuel systems support throughout Europe during the

, there were no proposals submitted that met the minimum acceptance criteria to award a new contract. While the core maintenance requirements remained intact for the replacement contract, significant changes when compared to the existing contract and task order include: shorter response times for unscheduled maintenance service orders; firm-fixed price (FFP) TÜV inspections for each year; FFP API 510 inspections for the base year; FFP Installation Status Reports for the base year; and a more comprehensive service order process with requisite documentation clearly defined to support cost reimbursable lines.

The ordering period for W912GB-12-D-0038 has expired and there is no other contract vehicle available to support these specialized fuel system maintenance services in Germany and Belgium. The Army and Air Force public works/civil engineering departments throughout Germany and Belgium do not have the organic capability to support these systems, nor do they have sufficient technical resources on their staff to support fuel system maintenance contracts. As such and with no replacement contract vehicle in place, operational and training missions throughout Germany and Belgium will be jeopardized due to the lack of fuel systems maintenance support if there is a gap in service. The fuel systems covered under the RMMR contract support refueling of tactical vehicles, equipment, and government vehicles at retail fuel points, and bulk fuel sites supporting operational airfields and ground maneuver units at major training areas.

Due to the background cited above and the vital support provided via the RMMR contract, CENAU is requesting a three month contract be put in place with a one month option to prevent a gap in maintenance services. This additional time will allow CENAU personnel to further refine the requirements and solicit feedback from industry to better understand market constraints in an effort to obtain more robust competition.

a) Substantial duplication of cost

The Government anticipates significant costs would be incurred if this bridge action was not awarded to the current RMMR contractor, ECC. The time and effort to demobilize ECC and mobilize a new contractor for such a short bridge contract action, would be extensive and costly. ECC currently has the resources and subcontractors identified and in place to cover the requirements to support this program. The de-mobilization costs attributed to the Government would involve taking over all 27 sites located in Germany and Belgium and performing all the required fuel systems maintenance requirements. There are also costs for a new contractor to familiarize themselves with the nuances of each of the 27 sites located in Germany and Belgium. Each site has its own access procedures and requirements for both regularly scheduled and unscheduled maintenance.

The majority of the costs associated with potentially replacing ECC are attributed to any efforts associated with familiarizing a potential replacement contractor with the 27 sites and costs associated with the any maintenance requirements that are immediate and projected. The transition period to the new contractor could potentially be significant and if these delays to the services contractor were determined to be compensable would result in significant financial and operational harm to the Government.

The only alternative that exists to providing RMMR services is to revise the current requirement and re-solicit these services using full and open competition procedures. There would also be substantial duplication of costs associated with another RMMR provider becoming sufficiently familiar with the implementation on this project. Consequently, the duplication of costs associated with another firm becoming sufficiently familiar with the various sites and maintenance services required on this project are so substantial that there is no plausible way that they would be recovered through competition before the end of service on 6 December 2018.

b) Unacceptable delays in fulfi

The RMMR contract provides scheduled maintenance visits that adhere with requirements outlined in UFC 3-460-03 for quarterly, semi-annual, and annual maintenance activities. This contract additionally provides the five year oil water separator general inspections, five year facility inspections, and three year safety and electrical device inspections that are required to be conducted by a host nation certified TÜV inspector at all 27 DLA-E site codes throughout Germany and Belgium. These maintenance and inspection functions are critical to keeping facilities in compliance with host nation and other applicable regulations while also providing the ability to address both routine and emergency unscheduled maintenance requests. This combination of unique capabilities makes the RMMR vehicle indispensable to Do beyond.

As fueling system failures have the potential to halt training exercises throughout the region and ground aircraft, it is of vital importance to have a contract vehicle in place capable of providing RMMR services, with no lapse in service. As the incumbent RMMR contractor, ECC, is currently providing RMMR services in Germany and Belgium, they are the only contractor with the ability to provide immediate maintenance support with no service gap. Despite the Go unforeseen challenges regarding vendor interest was only discovered after the solicitation closed and no awardable proposals were received. As there is not sufficient time to refine requirements, issue an amendment to the solicitation, provide offerors adequate time to revise proposals, evaluate proposals, and award a replacement contract prior to the expiration of the current task order, there is only one responsible source, ECC, that is capable of providing services that will satisfy agency requirements.

c) Additional information

Although CENAU experienced an unforeseen lack of competition in the

Germany/Belgium RMMR replacement contract acquisition, virtually the same requirements were included in the Spain RMMR contract that was awarded in September 2018, and the Italy Army RMMR acquisition that is currently being evaluated by the Source Selection Evaluation Board (SSEB). There were no questions posed during the Spain, Italy, or Germany/Belgium RMMR request for proposal phase that indicated a lack of interest or concern with the requirements contained within the new performance work statements.

That being said, the incumbent contractor had previously stated to the CENAU RMMR Program Manager that they had been experiencing increased difficulty in obtaining subcontractor support to meet task order requirements and were partially attributing this difficulty to ample work being available in the private sector, and an unemployment rate of 3.4%, the lowest rate in Germany in nearly four decades. While these indicators alone did not cause immediate concern for the replacement acquisition given that there are multiple approaches that can be utilized to meet contract requirements (i.e. self-perform vs.

subcontract) and that the current requirements were being met, the underlying market conditions may have contributed to the lack of competition received on the Germany/Belgium solicitation. Given the information provided above, it is critical for CENAU to fully understand the fundamental challenges contractors are experiencing and refine the requirements where possible. Given the potentially complex nature of this endeavor, additional time is required to award the RMMR replacement contract. Individual discussions with industry were held, which are further detailed under Market Research.

6. Efforts to Obtain Competition:

RMMR services must be in place no later than 7 December 2018 to avoid a gap in service. Sufficient time for a new contractor to mobilize and perform the requirement on an immediate basis is unrealistic. As a result, efforts to obtain competition for this bridge action under W912GB19R0017 will not be undertaken.

7. Actions to Increase Competition:

A solicitation for the new Germany and Belgium RMMR requirement was placed on the FedBizOpps website on 17 September 2018 with a closing date of 17 October under the solicitation number of W912GB18R0039. The Government did not receive any proposals that were awardable. Actions to increase competition will be taken under solicitation W912GB18R0039. Efforts will be primarily focused on revising the requirement to generate interest from qualified offerors. As detailed in Section 8 below, the Government conducted individual feedback sessions with firms that attended the site visit in response to the aforementioned solicitation. These firms were Arcadis, ECC, and Amec Foster Wheeler (Wood PLC). A post-closing amendment with the revised requirements based on industry feedback is anticipated to be released on 6 December 2018 with a proposal due date of 9 January 2019.

8. Market Research

Prior to the issuance of the solicitation (W912GB18R0039), an Industry Day was conducted for the DLA-Energy RMMR requirement throughout Europe and Africa on 15 March 2018. The purpose of this event was to seek industry feedback on how to best solicit for RMMR services. At that time, the Government desired to procure these services on a firm fixed price basis. Industry informed the Government that this was not possible under the current structure of the requirement. Changing the structure of the requirement would necessitate an organizational restructuring of DLA-Energy, which is not feasible or realistic. It was determined that the best course of action for both industry and the Government to meet the requirement was to solicit the RMMR services on a cost-reimbursable basis. Subsequently, the Government issued solicitations for RMMR requirements in both Spain and Italy using a hybrid firm fixed price and cost plus fixed fee structure. Each solicitation resulted in the Government receiving multiple proposals from qualified offerors.

However, in response to the posting of solicitation W912GB18R0039, the Government received proposals that were not awardable. These proposals were either missing required information or were parroting the requirements in the solicitation. There was simply not sufficient information available provided to conduct source selection. overall interest in the solicitation was not commensurate with the level of avidness that was indicated during the Industry Day. The Government conducted individual feedback sessions with each of the firms that participated in the site visit at Clay Kaserne for W912GB18R0039. The feedback from each firm was mostly similar, which revolved around the new response times and a shortage in the labor market. Firms believed adhering to the response times for all 27 sites as mandated under the new requirement was untenable. Industry did not feel that meeting the new, shorter, response times spread over the 27 sites was possible. This would require a greater labor demand, which cannot be currently met in the marketplace. Industry in Germany is reporting that there is a vast shortage in the skilled labor disciplines, which are necessary for performing RMMR services. These two aspects also make it extremely problematic when attempting to perform RMMR services located throughout the entirety of the required geographical area. Industry has recommended that dividing the requirement into separate smaller requirements would be easier to propose on. However, industry did acknowledge this course of action did not guarantee that they could propose on all the smaller requirements if this was pursued. This admission in addition to the unaccounted administrative cost to manage multiple requirements makes this approach disadvantageous to the Government and this course of action will only be considered as a last resort.

CENAU intends to award a new long term contract utilizing full and open competitive procedures as soon as possible. This process is still on-going and would not be awarded in time for this requirement to effectively transition contractors nor would it be appropriate for the reasons discussed above.

CENAU is the primary agent that manages RMMR requirements for the major service components in Europe. There are currently no other viable sources or contractual vehicles that the Government can utilize to fulfill the German and Belgium RMMR requirement.

9. Interested Sources

A Notice of Intent to issue a sole source bridge contract to ECC was posted on the FedBizOpps website on 1 November 2018. Responses were due no later than 12:00 p.m.

Central European Time (CET) 16 November 2018. No responses were received from interested parties.

10. Other Facts: Procurement History

Contract Number

Contractor name

Period of performance

Capacity awarded

Capacity remaining

Total # of task orders

12-D-0038 ECC Apr 2012 Oct 2017 $49M $27M 51

A. The German and Belgium RMMR requirement was previously provided via a five-year Single Award Task Order Contract (SATOC) estimated at $49.5M which expired on 29 October 2017. A modification to extend services under FAR Clause 52.217-8 Option to Extend Services was executed for Task Order W912GB12D0038-W912GB17F0009 for six months from 6 June 2018 to 6 December 2018.

11. Technical Certification: I certify that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

12. Requirements Certification: I certify that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

13. Fair and Reasonable Cost Determination: I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable. This contract action is anticipated to exceed the threshold as stated in FAR 15.403-4(a)(1). Certified Cost or pricing data will be required and relied upon in determining the reasonableness of cost/price.

The overall acquisition will be negotiated and evaluated in accordance with FAR 15.404- s proposal will be evaluated through price analysis techniques as described in FAR 15.404-1. The Independent Government Estimate for this requirement was developed using a wide range of professional experience, historical data and similar industry pricing and will establish a negotiation position in order to achieve a fair and reasonable price.

14. Contracting Officer Certification: I certify that this justification is accurate and complete to the best of my knowledge and belief.