B.04.21 - Consolidation MFR FY24 Roofing MATOC CoCO KO Signed_Redacted1_Redacted.pdf

JUN 22

CONSOLIDATION OF CONTRACT REQUIREMENTS DETERMINATION

FOR

W912HP24R5000

Multiple Award Task Order Contract for Design Build/Design Bid Build (DB/DBB) Building Envelope, Roof Repair and Replacement

(As prescribed by FAR 7.107-2 and AFARS 5107.107-2)

RATIONALE

1. Consolidation may provide substantial benefits to the Government. However, because of the potential impact on small business participation, before conducting an acquisition that is a consolidation of requirements with an estimated total dollar value exceeding $2 million, a written determination shall be made that the consolidation is necessary and justified in accordance with 15 U.S.C. 657q, after ensuring that--

(a) Market research has been conducted;

(b) Any alternative contracting approaches that would involve a lesser degree of consolidation have been identified;

(c) The determination is coordinated with the agency's Office of Small Disadvantaged Business Utilization or the Office of Small Business Programs;

(d) Any negative impact by the acquisition strategy on contracting with small business concerns has been identified; and

(e) Steps are taken to include small business concerns in the acquisition strategy.

2. Introduction: U.S. Army Corps of Engineers (USACE), Charleston District (SAC) plans to solicit offers for Design Build (DB) Construction and Design Bid Build (DBB) Multiple Award Task Order Contract (MATOC) for building envelopes, roof repairs and replacements at various locations throughout the Charelston District’s area of responsibility (AOR) and has conducted market research that demonstrates consolidation of this procurement to be both necessary and justified. FAR 2.102 defines consolidation as

(1) 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; or;

(2) separate contract as used in this definition, means a contract that has been performed by any business, including small and other than small business concerns.

3. Description of the Procurement Action:

a. Project Description:

The purpose of this acquisition is to provide a readily available contract tool that will enable the Charleston District to execute the renovation and repair requirements relating proactively and responsively specifically for building envelopes, roof repairs and replacements. Project sizes generally range from the simplified acquisition threshold to approximately , with a wide variance in complexity. Based on an acquisition history that has averaged annually over the last three (3) years for the Marine Force Reserves, Defense Logistics Agency, and NASA, and is expected to average at least that amount for the foreseeable future. This contracting effort will ensure that the Charleston District is able to support the roofing and building envelope construction needs of its stakeholders and other potential partners over the next five (5) years. The requested in total capacity would cover the anticipated capacity utilization rate and include a reasonable contingency in the event that the program shows unexpected growth or large obligations during the contract period.

The anticipated construction requirements will be predominantly under North American Industry Classification System (NAICS) code 238160 Roofing Contractors. Award will be made to a target of five (5) contractors. The contract will have a three (3) years base with one (1) 2 year option period. This procurement will be set-aside for Small Business.

b. Acquisition Strategy/Procurement Summary: To meet the renovation, and repair requirements identified by all Charleston District Customers at their various facilities over the next five (5) years, the Charleston District intends to award a MATOC pool with a capacity value. This MATOC pool will support execution of firm-fixed-price (FFP) task orders for the missions entrusted to SAC.

The scope and complexity will vary considerably between assigned projects. The period of performance will be a base period of three (3) years and a single option period for two (2) years. Individual task orders will be competitively solicited within the MATOC pool and negotiated to award to a single MATOC contractor. The availability of the MATOC will efficiently and effectively meet many of the Charleston District’s renovation and repair requirements and will also better position the Charleston District to successfully meet short-fused, fiscal year-end acquisition requirements. Use of the MATOC is in the best interest of the Government with respect to timeliness, oversight, and administrative costs.

c. Applicability of Consolidation: As stated above, the definition of consolidation in accordance with statue 15 U.S.C. § 657q and as set forth in Sec 44 of the Small Business Act, “consolidation of contract requirements,” with respect to contract requirements of a Federal agency, means a use of a solicitation to obtain offers for a single contract or a multiple award contract - (A) to satisfy two (2) or more requirements of the Federal agency for goods or services that have been forth in FAR 7.107-2(d). If the quantifiable dollar amount 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.

Utilizing an Indefinite Delivery Indefinite Quantiy (IDIQ) MATOC to consolidate the requirements for all of SAC’s various customers and programs is necessary to meet the district’s mission objectives. It provides a contracting vehicle that minimizes acquisition planning and contract execution costs, shortens contracting lead time, ensures operational continuity, and improves competition by competing procurements at the task order level versus relying on multiple individually competed actions with increased lead times. Use of an IDIQ is appropriate in accordance with FAR 16.501-2(a) when exact times and/or exact quantities of future deliveries are not known at the time of award. FAR 16.504(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 or 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. The Contracting Officer should use an indefinite-quantity only when a recurring need is anticipated. This new MATOC will provide the Charleston District with an acquisition tool and capacity to support awards in a timely and responsive manner, especially during the 3rd and 4th quarter of each fiscal year when much of the work is received and executed.

4. Results of Market Research: Compliance with the requirement of FAR Part 10 as it relates to market research has been accomplished. The method of market research was done via the Small Business Administration’s (SBA) Dynamic Small Business Search and a sources sought. On 15 November 2023 the Government queried the SBA’s Dynamic Small Business Search (DSBS) engine in order to identify the number of Small Business companies actively registered under the NAICS code (238160) in the southeastern states of South Carolina. The search resulted with 629 companies that fall within those criteria. A Sources Sought Notice was posted on SAM.gov on 31 October 2023, and closed on 15 November 2023. In total nineteen (19) businesses responded to the notice expressing interest in the MATOC. The technical team reviewed all of the submissions for the following factors, relevant experience, Puerto Rico experience, and bonding capability. The technical team made the determination that 9 businesses had “high confidence” ratings indicating they could meet the needs of the work to be performed on this MATOC and 4 businesses had “medium confidence” ratings indicating they could likely meet the need of the work to be performed on this MATOC.

The remaining were given “Low Confidence” ratings. In total all nineteen (19) responses to the sources sought notice were small businesses and zero (0) were other than small business. There were a total of ten (10) 8(a) firms that’s submitted, however only three

(3) 8(a) firms had single bonding capability up to $25M as preferred. Two (2) additional 8(a) firms responses yielded a single bonding capability up to $20M, thus a total of five

(5) 8(a) firms with bonding capability of $20M or greater. This would not be sufficient to competitively support a MATOC Pool target of five (5) firms with an 8(a) set aside.

Additionally, there were other socio-economic groups represented (HUBzone, EDWOSB, SDVOSB, and WOSB) by the responding businesses, but none were highly represented enough to support a MATOC Pool.

Company Name UEI Large Small 8a HUBZone EDWOSB SDVOSB WOSB

2A LLC GZ67CL86SJR6 X X X

Terra Site Constructors, LLC YDP7CA3MR5V8 X X New Dominion Construction, LLC LAA3W2UCHL23 X X X

ICGM GROUP LLC YW4ME8GHNHL7 X

Industrial Contract Service Corp HYHRJS9G18K5 X Reliance-Bernexis Team Joint Venture, LLC JDUFB31HFMK3 X X X CYE Enterprises, Inc KYDHEKQV9LK3 X X X Reasor Building Group, LLC H2ZDMKZLM472 X X Plenary Enterprises, LLC X3ZKY7SEHG36 X X SAC Services U653PUNVD3W5 X X Harbor Services, Inc JH52YFL71EA3 X X X ARK Construction Management, LLC XND5YKUFG6Z3 X X X Roofing Resources, Inc. LN4LMBCFJHN7 X X ERS Corp DUK2N5JZ1YY3 X X X South Central Roofing, Inc. LPFPK8MHKXB1 X X Conciege Business Solutions Inc T5QBL4EATCW3 X X DRI Inc CMNQCL7FNKB1 X X A-1 Anherma, LLC CNMMLSB3GED9 X X Alternate Roofing Solutions MJJTKAMFNAJ1 X

Following market research, it was determined that utilizing a Small Business Set Aside is an appropriate acquisition approach as we will have adequate competition for a MATOC pool. This determination will be documented on the DD 2579, Small Business Coordination Record.

5. Alternative Contracting Approaches and Rationale for Rejection: As documented in the Acquisition Plan, the PDT analyzed various contract types, including available and anticipated USACE contracts to determine the best contracting vehicle to achieve the successful completion of the construction activities in support of SAC’s Programs. Two (2) alternatives were identified and analyzed by the PDT.

Alternative 1: No Consolidation.

Alternative 2: Award a MATOC pool and issue task orders

a. Alternative 1: No Consolidation - Multiple individual contracts, covering each construction need. The District would primarily utilize competitive lump-sum “C-type” contract awards to cover each construction need.

Cost Risk: The cost risk in utilizing this procurement type is Low because each requirement is competed separately. This approach brings the lowest risk to pricing.

Performance Risk Performance risk is medium. While there is some assurance of successful performance through competing each requirement, this benefit may be offset if the Charleston District is frequently awarding contracts to new contractors and cannot establish long-term relationships with contractors performing construction under USACE managed projects.

Schedule Risk: Schedule risk is high.

The time required to award a standalone contract versus individual task orders against a MATOC is significantly higher, less efficient, and would potentially not allow the District to meet all milestones and/or mission requirements. A standalone construction contract will take between 120 days and 220 days depending on the estimated value of the requirement. The majority of the work, about 75%, would fall in the 120 days range. Assuming 5 actions a year with one action between and our annual lead time will be 700 days each year.

Other considerations and limitations: While this acquisition strategy has been used by SAC to award general construction and renovation, the increased cycle time decreases the quality of service to the District’s clients by increased acquisition cycle time. Further, SAC leadership has identified that, due to the District’s robust construction program, continuing to award individual contracts for each construction need is not sustainable due to constrained personnel resources.

Given SAC’s finite resources and the time required to award a standalone contract versus individual task orders against a MATOC is significantly higher, less efficient, and endangers milestone and/or mission requirements for many projects.

Furthermore, repeated use of this strategy constrains limited District resources due to increased effort in preparation and review of full contract plans and specifications, contract document preparation, coordination with the Small Business Administration, and post-award plan review/acceptance.

b. Alternative 2: Consolidation – Awarding a Multiple Award Task Order Contract

(MATOC) that cover the entirety of the scope of the contract.

Cost Risk: The cost risk in utilizing this procurement type is low. Utilizing MATOC Task orders allows each task order to be competed to the entire MATOC pool.

The ongoing competition for individual task order promotes competitive pricing for each project.

negative impact on end of year execution due to the time frame in which significant expiring funds are received by the District and resources are strained.

Using the acquisition cycle times (see Alternative 1) and estimating an average of five (5) actions per year under this proposed MATOC, the Charleston District would save an estimated 1,900 days (assuming 3-design build, and 2 design-bid-build procurements a year) of total acquisition cycle time over the course of the five-year MATOC period of performance.

The use of task orders under a MATOC streamlines the procurement process and is significantly more expeditious than a “C” contract strategy. Historically, the required Procurement Acquisition Lead Time (PALT) for a design-bid-build “C” contract using IFB takes a minimum of 180 days (IFB) and includes internal reviews (DQC, ATR, BCOES), procurement related activities, such as market research, coordination with SBA, creating solicitation, legal review, and administrative activities necessary for soliciting/awarding the contract. The PALT for a two-phase design-build with similar size and complexity is approximately 330 days. Having multiple projects under development at the same time for similar work would result in overlapping reviews, tie up labor resources, and decrease administrative efficiencies. In addition, the likelihood exists that the same District personnel would be working on multiple projects, increasing the time required from project start to contract award for the individual projects. In contrast, task orders under a MATOC do not require significant advance notice, voluminous solicitations and proposal reviews. The historical PALT, i.e., the time it takes from Contracting receiving all the necessary documents until contract award for Design-Build MATOC Task Orders procedures is 105 days. This reduced lead time allows the District to respond faster, increasing the success of the overall mission.

Very often, requests for execution of work are not received by the District until the third and fourth quarters of the fiscal year. The late project priority determinations by customers and corresponding late delivery of funding necessitates that SAC utilize flexible and efficient procurement strategies. These externally imposed end-of-year procurement requirements are most successfully addressed by the streamlined acquisition procedures provided under FAR Part 16, where there is no requirement to advertise a project for 15 days, or to provide prospective contractors 30 days to submit a proposal. Accordingly, if SAC is constrained to “C” contracts for each project, any requirements that are presented in the fourth quarter would be at significant risk, or impossible, to award before funds cease to be available for obligation within the corresponding fiscal year.

Other considerations and limitations: The government also considered the use of 8(a) sole source contracts for actions to fulfill the needs of this program. However, that strategy would only apply to those procurements not using the two-phase design-build procedures at FAR 36.3. It is important to note that many procurements under

Using the aforementioned acquisition cycle times and estimating an average of five (5) actions per year under this proposed MATOC, the Charleston District would save an estimated 1,900 days of acquisition cycle time over the course of the five-year MATOC period of performance.

d. Terms and Conditions: There is anticipated to be no difference in terms and conditions between various acquisition methods.

e. Conclusion: Standalone contracts for all the roofing and building envelope type construction needs is not a plausible method for procurement or an efficient use of resources. Individual procurement actions for each project would increase redundancy, increase cost, lessen response time, and provide a lower level of overall service for this program. Utilizing a MATOC will allow the contractors to have familiarity with performance and work expectations and will substantially reduce the risk of performance issues, terminations, protests and other disputes that often arise during individual contract award. In addition, project familiarity and requirements will lead to in increased efficiencies for contractors during the contract period of performance.

While it is noted that the expected quantifiable benefits are meaningful, they do not meet the thresholds for a substantial benefit at FAR 7.107-2(d)(1)(ii) and justify consolidation on the merit of cost savings alone. However, based on reasoning provided in this analysis, having a construction MATOC tool in place is critical to the success of SAC’s programs for the primary reason of acquisition cycle time (FAR 7.107-2(c)(2)). A small business set-aside for this MATOC pools allows us to maximize small business participation.

7. Bundling:

a. Definition of Bundling: FAR 2.101 defines bundling as consolidating two (2) 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.

b. Applicability of FAR Bundling Definition: Since this acquisition is to be set-aside for small business concerns, it does not meet the definition of bundling.

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). 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 procurments combine separate requirements into one contrat; thus, they have the potential to restrict competition in violation of CICA by excluding firms that can provide only one portion of the bundled requirement.

d. Applicability of CICA Bundling Principle: Not applicable.

8. Considerations, Facts, Reasoning Supporting the Determination: All facts, considerations and rationale have been covered previously in the findings. The DD 2579 is being prepared and will be reviewed and signed by the Contracting Officer, Deputy for Small Business, and the Small Business Administration (SBA) Procurement Center Representative (PCR).

9. Summary: Though this MATOC constitutes consolidation in that it combines construction at two (2) or more discrete sites, this approach provides the best combination of competitive procedures, timely acquisition, cost efficiency, quality, and capable prime contractors to execute the requirements. The quantifiable benefits of consolidation are or of the estimated MATOC value, which does not exceed the minimum standard of 5% applicable to this acquisition (FAR 7.107- 2(d)(1)(ii)). However, this savings is significantly supplemented by decreased acquisition cycle times. Other acquisition alternatives were considered but would result in higher costs and increased acquisition cycle time that would be detrimental to the missions entrusted to the Charleston District.

The consolidated approach provides advantages that substantially exceed the benefits of alternate approaches. Based on sound business judgment in view of the size, complexity, and number of efforts to be executed for the Charleston District customers, the findings of the market research, and the documentation provided herein, consolidation of requirements is both necessary and justified.

CONSOLIDATION OF CONTRACT REQUIREMENTS DETERMINATION

for

W912HP24R5000

Multiple Award Task Order Contract for Design Build/Design Bid Build (DB/DBB) Building Envelope, Roof Repair and Replacement

COORDINATION: