B.04 - DF Consolidation - W912HN23R4005 - Barracks 24406 24413_Redacted.pdf

Source Selection Information, See FAR 3.104

FOR OFFICIAL USE ONLY

DEPARTMENT OF THE ARMY

U.S. ARMY CORPS OF ENGINEERS, SAVANNAH DISTRICT

DETERMINATION AND FINDINGS REQUEST FOR CONSOLIDATION

W912HN23R4005, FIRM FIXED PRICE TYPE CONTRACT

W912HN-23-R-4005

100% Total Small Business Set-Aside Design-Build Construction Repair 24-Series Barracks

Project DE-02529-8P – BLDG. 24406 Project DE-02532-8P – BLDG. 24413

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 that consolidation, in accordance with 15 U.S.C. § 657q, (FAR) 7.107-2, is both necessary and justified. This approval is made in accordance with the approval thresholds set forth in Army Federal Acquisition Regulation Supplement (AFARS) 5107.107-2, Consolidation. My review resulted in the following:

FINDINGS

1. Introduction: The U.S. Army Corps of Engineers, Savannah District (SAS), proposes to award a Two-Phase Design-Build Firm Fixed Price Contract in

This contract will be awarded to one (1) contractor. This award will be utilized to design and renovation of Barracks BLDG. 24406 and BLDG.

24413.

2. Description of Procurement:

A. Project Description: This project includes work for each building is anticipated to include replacing failed fan coil units with the central HVAC system. The installation of new HVAC controls that includes full integration with UMCS to achieve Army energy goals. The installation of new fire alarm systems. Mold and mildew abatement and

SAS has utilized various Small Business Set-Aside and SATOCs for SRM projects for all installations within SAD AOR.

F. Rationale for Consolidation:

(1) The primary justification to consolidate the two (2) requirements repair and renovate existing barracks is that these projects are similar in scope. The work being consolidated in these two (2) projects are located in the same vicinity, which is in the 24000 Series Barracks complex, on Fort Gordon. The Barracks are due for renovation and repair to account for the growth at Fort Gordon. The installation of new HVAC controls includes full integration with UMCS to achieve Army energy goals. It also includes the installation of new fire alarm systems, and mold and mildew abatement and remediation. As this is a safety risk, a long lead time will render the buildings unusable until the work is completed.

The consolidation of the projects will allow the same Small Business Contractor to complete the design and work of the same standard. This will alleviate the need to mobilize multiple contractors and coordinate their access in the same vicinity. With the work being within the same vicinity, the contractor and the Government’s construction management team will also benefit from time and cost efficiencies. As these two (2) projects are being procured at the end of FY, combining these projects to one (1) consolidated procurement will allow for Construction Division to reduce the number of resources needed to negotiate and manage a singular requirement as opposed to multiple projects, in addition to other Fort Gordon requirements. As the outcome of repairing and renovating the barracks buildings is the same, the management of this outcome should be done in similar fashion, instead of multiple construction division resources handling numerous scheduling conflicts and contractors.

The District needs to be able to closely communicate and schedule the work with the contractor and have the ability to relay and work through the scope and known durations and timelines for the work prior to awarding the project. There is a delicate balance of when these facilities are available for work and the deadlines for starting and finishing are critical to continuing operations and keeping barracks capacity available. The availability of the barracks is vital to Fort Gordon as it is a high operations tempo installation with its customers needing the barracks for everyday function and use. Unavailability of the barracks will cause damage to customer operations through the lack of available housing for service members.

The benefits of a 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: 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 and/or enhance performance or efficiency; reduce acquisition cycle time; better terms or conditions;

or any other supportable benefit. Benefits that are quantifiable are considered substantial if they meet the dollar amounts set forth in FAR 7.107-2(d). For this procurement, the quantifiable benefits as shown in Paragraph 5 below do not meet/exceed the threshold 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. As stated above, given limited resource and time, and given the complexity of coordinating the renovation projects if they were solicited separately, the consolidation of the requirements is critical to the agency meeting its mission of providing safe and usable barracks in the limited time and space available for renovation. Small business participation in the consolidated procurement will be fully achieved, as the consolidated procurement will be a competitive 100% Total Small Business Set-Aside.

(2) A review of existing General Construction contracts was done prior to deciding to award a new contract. Although SAS has several IDIQ contracts that could be used for this work; the capacity of those contracts is either reserved for known work, enough capacity is not available to award this new requirement, or the newly placed IDIQ has a large portion of its capacity reserved and this project which would cause increased utilization issues.

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

4. Results of Market Research:

Market research was performed on 12 May 2023 through a search of System Award Management (SAM) utilizing NAICS Code 236220 with an active registration to determine the magnitude of potential small business that are registered, which resulted in 451 Small business. A comparative search using the SBA Dynamic search tool was conducted to further understand potential small business magnitude. Initially, utilizing only the NAICS code 236220, within the states of Georgia, North Carolina, and South Carolina, and General Nature of Business (Construction) to narrow the search to entities, geographically located within the region and whose nature of business is in line with the requirements of the Government. Then to further understand the market place an additional criterion was added to the search values to identify the bonding capability of entities within this region utilizing $25M per contract for bonding capability, Bonding $25M per Contract column for resulting in 46 small businesses. The results demonstrate the socio-economic entities within our area and utilize approaches such as this to impact those locally from both an economic and employment standpoint directly.

5. Alternative Contracting Approaches Considered and Rationale for Rejection:

SAS recognizes the least level of consolidation is to execute the two projects utilizing stand-alone contracts.

A. Alternative 1 – Stand-Alone Contract for each project: The District makes every effort to conduct stand-alone procurements for MILCON and large SRM projects.

The alternative would be no consolidation of the requirements, and two (2) stand-alone contracts would need to be put into place. The standalone contract approach results in higher costs, when considering the Government labor cost charged to the customer.

Separate stand-alone construction contracts result in an estimated labor cost of at least each. This cost is based on the typical labor rates for Contracting, Engineering, Construction, and Project Management, and includes the entire competitive source selection process. The estimated total cost of per contract action at two (2) contracts is This is the cost SAS would incur to execute stand-alone contracts.

The cost of each project would include the cost to mobilize, manage the work, and de-mobilize and coordinate access for two contractors. This would mitigate and minimize the benefits of competing each requirement.

The average Procurement Acquisition Lead Time (PALT) for each of the two (2) stand-alone contracts is a minimum of The impact of the delay by use of stand-alone contracts in lieu of consolidating requirements puts the readiness and usability of the installation buildings in jeopardy. The current barracks are not up to standard for appropriate usability. As this is a safety risk, a long lead time will render the buildings unusable until the work is completed. The cost of each project would include the cost to mobilize, manage the work and de-mobilize for two contractors. This would mitigate and minimize the benefits of competing each requirement which will cause further delays in design and construction.

Fulfilling this requirement through separate, stand-alone contracts would result in considerable risk of higher costs and scheduling constraints to the Government.

Consolidation of the requirements promotes flexibility to complete the work in the timeframe required. As discussed in Paragraph F above, the delicate balance of availability to conduct the work in relation to deadlines of commencement and completion are critical to continuing operations and keeping barracks capacity available.

Fort Gordon cannot perform its housing mission of soldiers without safe and available barracks that are deemed usable.

A single standalone contract limits competition, however, both projects are located in the same vicinity and are similar in scope. Consolidating the project into one (1) Barracks Design and Construction package will reduce the overall labor cost compared to two individual stand-alone contracts. This is allowing for the need of only one (1) Source Selection Evaluation Board, as opposed to multiple. This cost is based on the typical labor rates for Contracting, Engineering, Construction, and Project Management of a Two-Phase Design-Build Source Selection Process based Project. For Alternative

1, two (2) competitive stand-alone contracts, the estimated cost SAS would incur and charge the installation is . At two (2) standalone contract actions the total would be Comparatively, a single competitive stand-alone contract actions’ estimated labor cost would be . When comparing the savings between two (2) standalone contracts actions to one (1) consolidated contract, there is a savings from the estimated value of the consolidated projects, not including any potential project cost savings. This is determined by subtracting the labor cost of one consolidated contract from the total of two (2) individual standalone contracts then dividing the difference by the estimated total of the proposed contract Consolidating these buildings as packages alleviates the need for the mobilization of multiple contractors and reduces the total cost of labor to the Installation and usage of personnel resources at the district level.

Additionally, consolidation of this requirement will not have an adverse impact on small business concerns because this Two-Phase Design-Build Solicitation will result in award to a small business concern.

6. Bundling Analysis:

a. FAR Bundling: Definition of Bundling. FAR 2.101 defines bundling as a subset of consolidation that combines two or more requirements for supplies or services, previously provided or performed under separate smaller contracts, into a solicitation for a single contract, a multiple-award contract, or a task or delivery order 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 (1)(i), (ii), and (iii) of this definition.

b. Applicability of FAR Bundling Definition. This acquisition does not meet the definition of bundling in that the proposed general construction services contemplated have not previously been performed under separate smaller (i.e.

individual) contracts. In addition, the consolidated requirement is appropriate for performance by a small business and will be awarded to a small business concern.

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. In order 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. CICA Bundling is justified for this procurement. The CICA requires solicitations to provide for full and open competition except where restrictions on competition are necessary to satisfy the procuring agency's needs. In such a case, restrictions on competition are allowed but only to the extent necessary to satisfy the agency's needs. 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. The level of restriction proposed represents the least level of bundling necessary to meet the District’s needs. Although CICA requires solicitations to provide for full and open competition, FAR 6.203 allows for Set- Asides for Small Business Concerns:

(i) To fulfill the statutory requirements relating to small business concerns, contracting officers may set aside solicitations to allow only such business concerns to compete.

(ii) No separate justification or determination and findings is required under this part to set aside a contract action for small business concerns.

(iii) Subpart 19.5 prescribes policies and procedures that shall be followed with respect to set-asides.

7. Considerations, Facts, and Reasoning Supporting the Determination: This standalone Two-Phase Design-Build contract does support Small Business. As this is a safety risk, a long lead time will render the buildings unusable until the work is completed. Flexibility and conformity are needed for mission success as unusable barracks do not fulfill Fort Gordon’s role as a training and operational installation.

Utilizing 2 separate projects forgoes that ability to properly manage the scheduling and completion timeframes.

8. Summary: Fulfilling this requirement through multiple separate, stand-alone contracts would result in considerable risk of higher costs and scheduling constraints to the Government. Consolidation of the requirements promotes flexibility to complete the work in the timeframe required. As discussed, the buildings are Barracks, and due to operational constraints and needs, the time frame in which these buildings are to be worked on must be efficiently planned. Failure to plan accordingly could result in more costly issues for our customers and the installation. The availability of the barracks is vital to Fort Gordon as it is a fast-paced operations and training installation with its customers needing the barracks for everyday function and use with heavy rotation of service members needing housing. Unavailable barracks create crowding in available barracks and potential safety issues. Finally, the Fort Gordon customers that this contract will support consider the successful execution of each requirement critical to their mission.

Base Project DE-02529-8P – BLDG. 24406 Option Project DE-02532-8P – BLDG. 24413

The following signatures indicate concurrence within the Savannah District with the contents of this document for the consolidation of two projects through a contract as a result of a Two-Phase Design-Build Solicitation.

Project DE-02529-8P – BLDG. 24406 Project DE-02532-8P – BLDG. 24413

Upon the basis of the findings above, I hereby determine, pursuant to the authority of 15 U.S.C. § 657q, Federal Acquisition Regulation (FAR) 7.107-2, “Consolidation” and Army Federal Acquisition Regulation Supplement (AFARS) 5107.170 "Consolidation of Contract Requirements", that the proposed consolidation of two (2) construction projects for the Department of Defense within Fort Gordon, GA is both necessary and justified.