W91CRB13D0012ACEITJ A.pdf

Control Number: 13-031

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Agency/Contracting Activity: U.S. Army Contracting Command, Aberdeen Proving Ground (ACC-APG), Aberdeen Proving Ground, Maryland 21005.

2. Description of Action:

New Contract, Indefinite Delivery Indefinite Quantity, citing FY 13 Operations and Maintenance (OMA) funds for the base year and FY 14 thru FY 15 OMA funds for each subsequent option year, for $800K minimum per year with up to $1.650 million maximum per year. The minimum award total for all three years is $2.4 million. The maximum award total for all three years is $4.95 million.

Nature: New Requirement

Pricing: Firm-Fixed Price task orders

Funds: Operations and Maintenance, Army (OMA)

Fiscal Year of Funds: FY 13 Operations and Maintenance (O:MA) funds for the base year and FY 2014 thru 2015 OMA funds for each subsequent option year.

Name of Proposed Contractor(s): Tecolote Research, Inc.

Street Address: 420 S. Fairview Ave., Suite 201 City, State, Zip: Goleta, CA93117-3626 Phone: (805) 571-6366

3. Description of Services or Supplies:

Performance period of the contract is for one base year and two option years, totaling 3 years. The maximum award total for all three years is $4.95 million.

a. The contractor shall provide all personnel, equipment, tools, material, supervision, and other items necessary to provide non-personal technical support services in support of the Deputy Assistant Secretary of the Army for Cost and Economics (DASA-CE) as defines in the Performance Work Statement (PWS) 1.1.

b. The objective ofthis effort is for the contractor to provide support to the office of the DASA-CE in the area of enhancing and training on the Army's standard cost model, Automated Cost Estimating Integrated Tools (A CElT). Objectives follow:

1) To develop tools and methodologies to estimate the cost of Army Programs to support the Planning, Programming, Budgeting, and Execution System (PPBES) process.

2) To support the development of cost models, databases, and plug-ins for A CElT.

3) To provide A CElT Maintenance and Help Desk

4) To provide Training and Support

c. The contract entails contractor enhancements of the A CElT software including models, tools, methodologies, and databases approved by the Army government manager. The contract includes up to 12 fu Progress Reviews, one at award and one every three months to be conducted with the Army government manager. A CElT support services include technical assistance, help desk, test plan, and product version updates for all A CElT software components. This contract provides ARMY wide Distribution, Maintenance and Support for A CElT. The contractor assists with A CElT Distribution, installation, Maintenance, and Support at Army organizations, Headquarters, Commands, PEOs, and PMs. The contractor will provide MechanicS hours which can be used for remote, on-site support, and training at Army organizations. The contractor provides Army wide A CElT Training at Army organizations, Headquarters, Commands, PEOs, and PMs. Training includes providing open seats in contractor site offerings

d. DASA-CE's mission is to provide the Army decision-makers with cost, performance and economic analysis in the form of expertise, models, data, estimates and analyses at all levels. These are subsets to the anlaysis first mentioned. DASA-CE is the principal advisor to the Assistant Secretary of the Army Financial Management and Comptroller) (ASA FM&C), the Army's Chief Financial Officer, on all Army cost and economic analysis activities. The ASA-FM&C and the Assistant Secretary of the Army have mandated the use of ACEIT in providing Acquisition Category I and II Acquisition Category Program Cost Estimates. This defines the context of the services to be provided.

e. The verified minimum requirements of the Government is a family of applications that support program managers and cost/financial analysts during all phases of any program's life-cycle with monthly and yearly calculations, functions, and time-phased results with or without inflation across multiple program sites. It must include application tools (Army commodity databases, statistical analysis, knowledge libraries including cost estimating relationships (CER) libraries, model building, risk analysis, distribution fitting, and more) for storing/analyzing cost/technical data, developing cost/cost risk models ,cost-schedule risk models, cost estimating relationships, sharing, and reporting cost estimates. A framework to build robust cost models where key analysis tasks (learning, phasing, inflation, risk, reporting, and documentation) are automated. It must include established structures in Military Standard Work Breakdown Structures (MIL SID 881C) for Army Commodities and Army Cost Estimating Structures. It must provide consistency to the cost and cost risk analysis modeling and estimating process. It must maintain compatibility with PRICE, SEER, MS Project, NAFCOM, lACS, OSD Inflation Utility, and MS Excel tools.

It must provide the ability to open historical estimates in a calculable format.

4. Authority: The statutory authority permitting Other than Full and Open Competition is I 0 U.S.C.

2304(c)(1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or

Services Will Satisfy Agency Requirements.

5. Reasons for Authority Cited: Tecolote Research, Inc owns the source code copyright to all ACE IT software components used by the Anny and is therefore the sole supplier of technical support services for the ACE IT software. Tecolote support services include distribution, maintenance, support, training, technical assistance, help desk, and product version updates for all ACEIT software components. For more than 25 years, Tecolote has been the sole-source government developer, trainer, and technical support provider of the industry-leading cost estimating software suite A CElT.

Tecolote has developed an average of one software release a year; trained more than 8,000 users; and provided technical support to more than 250 customer sites worldwide. The Assistant Secretary of the Army for Financial Management & Comptroller and the Assistant Secretary of the Army have mandated the use of A CElT in providing Acquisition Category I and II Acquisition Category Program Cost Estimates. The Army in it's Title 10 responsibilities is required to perfom independent cost estimates. A CElT is the Army's tool for doing independent cost estimates. It would take up to (within the PPBES cycle) five years to attempt to execute an Army-wide transition to other tools if they exist in matching capabilities. Substantial duplicate cost of opening the requirement to full and open competition is addresses in section h below.

a. Failure to procure the desired technical and license support on time would significantly harm the government. The A CElT licences expire on 4/30/2013 Army-wide. Without them Progam Managers (PMs), Program Executive Offices (PEOs), and other Anny commands will be unable to open their old cost estimate files to modify them or create new ones. Program milestones will be delayed which would cause significant harm to the government. The Anny will be unable to develop cost estimates and cost analysis products for Army Program Decisions with tools that have been tested and audited. The Anny is constantly doing cost benefit program analyses. Without the tools to do the analyses, Army decision-makers would make non cost informed decisions. Which would be illegal at worst (not providing independent cost estimates) and ill informed at best.

b. In addition the PM and Major Commands Offices will not be able to analyze and review contractor proposals base on parametric models nor would they be able to use their existing parametric estimates. Decisions will be made without the benefit of updated cost models and databases to support the costing effort.

c. Alternatives: Market Research conducted revealed that there are no other sources to satisfy the agency needs. The lack of other options revealed by the sources sought notice brought upon the conclusion. Tecolote Research, Inc owns the source code copyright to all A CElT software components and is therefore the only authorized supplier of technical support services for the A CElT software we have previously obtained. Tecolote support services include technical assistance, training, help desk, and product version updates for all A CElT software components. Replacing ACE IT would result in duplicate costs of maintaining two systems and R&D costs to add the same functionality of ACEIT to an alternative system.

There is also a requirement to be able to maintain and access Milestone Army Cost Position files from A CElT in a calculable format. There would an overlapping transition period of at least two to three years while enhancements are made to software that does not exist to give it all the functionality that ACE IT has.

There would be an increase in training cost, $3M to $6M, as all users would have to be trained as well (((1 01 +27)x $23, 172)x2). In addition some ACEIT expertise would have to be maintained (128x $2,300) for $294k. In this resource restraint environment any other alternatives would not be feasible.

b(4)

d. Basis for Justification:

I) Some software packages can do a few of these requirements but market research conducted and the Government past experience revealed that only Tecolote Research Inc. can meet all mission requirements Army Analysts require.

i. Tecolote Research Inc., 420 S. Fairview Avenue, Suite 201 Goleta, CA 93117-3626, Phone: (805) 571-6366, Fax: (805) 571-6377 is a private, employee-owned corporation that is nationally known for providing specialized cost analysis and financial management support to the U.S.

Government. Since 1973, they have focused on providing clients with the analyses and tools they need to make sound programmatic decisions in an environment of constantly- more ... changing budgets, technical requirements, and schedule constraints. Tecolote Research, Inc owns the source code copyright to all A CElT software components and is therefore the only authorized supplier authorized supplier of technical support services for the A CElT software we have previously obtained. Tecolote support services include technical assistance, training, help desk, and product version updates for all ACEiT software components.

11. The use of ACEIT is required for all Army ACAT I and II category program cost estimates. A CElT use was directed by the Assistant Secretary of the Army (Acquisition, Logistics, and Technology) and the Assistant Secretary of the Army (Financial Management and Comptroller) in the Memorandum dated 15 April2004.

h. Impact: The Army will be unable to accurately develop cost estimates and cost analysis products for Army program decisions. In addition the PM and Major Commands Offices will not be able to analyze and review contractor proposals base on parametric models nor would they be able to use their existing parametric estimates. Decisions will be made without the benefit of updated cost models and databases to support the costing effort.

Lastly, the PM and Army Commands Offices that require the models will execute their own licensing agreements, training and hands-on- consulting support at significantly higher cost to the Army in this resource restrained environment. The ODASA-CE centralized acquisition saves roughly 10-15% on support and up to 50% on the cost of some licenses compared to what these organizations would pay individually. For example, if the 101 Army locations plus 27 Army Support locations had to obtain their own ACEIT licenses at $14,150 a piece it would cost the Army $1,811, 200 a year ($14, 150 x (1 01+27)) in unnecessary duplication in cost. This would be just for licenses not including enhancements, training, mechanics hours, updates, etc.

6. Actions to Increase Competition: Competition is unable to be increased for the specific ACEIT software unless the Army changes its requirements, however, ODASA-CE has already taken steps to increase comptetion by separating the ACEIT Cost Data Bases (ACDBs) into separate actions as stated in paragraph 9 below.

7. Market Research: A Sources Sought Notice was posted on 13 February 2013 on the Army Single Face to Industry (ASFI). The Notice closed on 25 February 2013. It gave the industry notice of the requirement and an opportunity for the Government to identify any additional sources for the required services.

Technical Experts with the DASA~Cost Policy and Research Division, are aware of the cost tools available for Anny wide use because of the following efforts taken. They are part of the Collaborative Cost Research Group, which last met on 12 October 2012 and the GAO Cost Expert Group, which last met on 14 March 2013, and attend the Annual DoD Cost Analysis Symposiums, which last met on on 15 February 2012. These experts are contacted by vendors who want to demo their products and are aware of the market tools available. Market research is an ongoing affair in DASA-CE as they are always looking for tools and resources to help strengthen their process. They realize that Tecolote Research, Inc. is the only vendor to receive ACEIT services from. This action shall be publicized as required by FAR Subpart 5.201. To date no other sources have expressed interest, but all offers received shall be considered.

8. Procurement History:

a. This requirement has previously been previously fulfilled with period of perfonnance through April29, 2008 was awarded against contract DASWOI-03-A-0011 Requisition

W8IBA8-7054-0001 for $900,000. The combined period ofperfonnance was from 30

April2008 to 29 April2013. The most recent award W91 WAW-08-D-0018 was issued in

Apri12012, with a period ofperfonnance from 30 April2012 to 29 April2013. Both contracts mentioned were awarded to Tecolote Research, Inc. under the statutory authority pennitting Other than Full and Open Competition 10 U.S.C. 2304(c)(l), as implemented by

FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will

Satisfy Agency Requirements.

b. Subcontracting Competition: FAR 52.244-5, Competition in Subcobntracting will be included in the solicitation and will be incorporated into the resulting contract. The contractor will be required to address and obtain as much competition as possible in subcontracting in its proposal.

9. Additional Information to support the justification: The ACE IT software package includes five

ACEIT Cost Data Bases (ACDBs), four Army Commodity ACDBs and one Joint Services ACDB.

They are the wheel and track vehicles ACDB, the missle and munitions ACDB, the electronics

ACDB, the aircraft ACDB and the ioint Services ACDB between the Air Force, the Marine Corps, and Navy. These are the Automated Cost Databases that are included with A CElT and shipped with it.

This will result in five competitions as each of these database contracts ends. Tecolote has also provided the capability for customization and integration of other products within ACEIT with the ACE API. This along with the data file formats available allows any company that wishes to make the investment to match A CElT's capabilities to compete with it. The program office has taken the original A CElT software package and separated its

A COBs in order to obtain competition. The actual A CElT software is the onle part that is not able to be competed due to the Tecolote source code copyright ownership.

10. Teebnical/Requircmcnts Certification: I certify that the Supporting data under my cognizance which is included in this abbreviated J&A is accurate and complete to the best of my

Submitted By:

knowledge and belief.

Position Title:

Email address:

11. Fair and Reasonable Price Determination: AB contracting Officer, I herebY determine that the anticipated cost to the gOvernment for this contract action will be fair and reasonable.

Provide the basis for this dctermi.naJ.i<m, e.g., describe techniques to be used to' determine fair i!Dd reasonable price (F 15 .402), such as price analysis, cost arialysis, cost realiSltl~ PerF .f\R. 15.403- 4(a)(l), the threshold fir obtaini ing data is $700,000. . .

SIGNATURE:

NAME:

TffiE:

v12. Re"Views: I have reViewed this j'.lstifi~tion ~ find it legally sufficienf

Legal Counse

SIGNATURE:

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13. Contracting Officer's Approval: I hereby ceitl.fy that this justification is accurate and complete to the best of. my knowledge and belief. Based ,on the foregoing, 1 approVe this sole source justification bject to availability of funds. and provided that the services and sUpplies herein describe

==TURE:

TITLE:

b(6) b(6) b(6)

14. Competition Advocate for the Procuring Activity:

Approval

Based on the foregoing justification, I hereby approve the procurement of the Automated Cost

Estimating Toolkit (A CElT) support services on an other than full and open competition basis pursuant to the authority of 10 U.S.C. 2304(c)(l), subject to the availability of funds, and provided the services-her · described have otherwise been authorized for acquisition.

SIGNATU

NAME:

TITLE: