MTSJ&A.pdf

Control No. JA-10-0004

FOR OFFICIAL USE ONLY – PROCUREMENT SENSITIVE

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 1

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 4

Justification and Approval for Other Than Full and Open Competition

1. Contracting Activity: Army Contracting Command (ACC), National Capital Region Contracting Center (NCRCC), U.S. Army Information Technology E-Commerce and Commercial Contracting Center (ITEC4), ATTN: CCNC-IT, 2461 Eisenhower Avenue, Alexandria, VA 22331-1700.

2. Description of Action: This proposed contract action will modify the Movement Tracking System (MTS) Indefinite Delivery/Indefinite Quantity (ID/IQ) firm fixed price contract to increase the contract ceiling amount by $226M from $673.1M to $899.1M. In concert with the contract ceiling increase, it will also add options for two (2) bridge periods each consisting of a six (6) month period of performance (PoP). These bridge periods will be incorporated as formal options, and exercised as necessary in accordance with Federal Acquisition Regulation (FAR) 52.217-9 Option to Extend the Term of the Contract which is found in the existing contract.

With the incorporation and subsequent exercise of each of the two option periods, a D&F will be prepared determining that a multiple award cannot be used in accordance with per FAR 16.504(c)(1)(ii)(B)(4) and FAR 16.504(c)(1)(ii)(D)(1)(i), because the task or delivery orders expected under the contract are so integrally related that only a single source can reasonably perform the work.

The purpose of the ceiling increase is to continue maintenance and support of the Operational Tempo of the Program, until a new competitive contract can be awarded. This new contract will achieve a break in dependence on non-competitive acquisitions and maximize future competition. The current sole-source contract, W91QUZ-07-D-0018, was awarded 1 Sep 07 to Comtech Mobile DataCom Corp (hereinafter “CMDC”) with a ceiling price of $673.1M and a period of performance consisting of one base year plus two one-year option periods and an expiration date of 12 Jul 10. The expectation is that the current ceiling price ($673.1M) will be reached or surpassed before 30 April 10. The primary reasons the ceiling will be reached three and a half months early is the continued need to maintain the Operational Tempo of the Program and the unanticipated receipt of increased Program funding much of which has been expended against the current ceiling. In July 2008, the MTS Program received a plus-up of $356M which was identified for the refresh of fielded, old technology-based computer hardware that has been out-paced by the increased functionality of new software, and in August 2009, the plus-up of $37.2M Overseas Contingency Operations (OCO) funding to support the expanding missions in Operations Enduring Freedom (OEF) which includes constituting and sustaining an operational pool of Theater Provided Equipment (TPE). It is estimated that requirements for the MTS contract actions from 14 May 10 (exhaustion of current ceiling) - 12 Jul 10 (end of current contract PoP) will total $116.6M. The estimated requirements for MTS contract actions from 13 Jul 10 to 12 Jan 11, and 13 Jan 11 to 12 Jul 11(the two (2), six (6) month option periods ) will total $78.5M and $98.8M respectively, and along with the current ceiling increase of $48M will result in a grand total ceiling increase of $226.0M. To summarize:

The total ceiling increase for the MTS program, $226.0M, will be expended by three different

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 5

contract actions:

1 - To fund the remaining time left (now 4 months, ending July 12, 2010) on the current contract. Total $48.6M.

2 - To fund the exercise of the first newly incorporated option period starting July 13, 2010.

Total $78.5M.

3 - To fund the exercise of the second newly incorporated option period starting Jan 13, 2011. Total $98.8M.

The strategy of increasing the ceiling price for the remaining time left on the current contract and establishing two (2) optional six (6) month bridge periods is intended to support the completion of a competitive contracting approach which is planned to be a full and open competition, ID/IQ firm-fixed price contract. Option #1 may be required to ensure continuity of operations for the Warfighter as the new contract, awarded under full and open competitive conditions, completes its formal 100-day potential protest period and undergoes due-diligence Government testing.

Option #2 may be required to support a potential overlap Ramp-up/Ramp-down period and facilitate the fielding of new components, de-fielding of components no longer needed, and the transition from the existing network operations center (NOC) to the new network operations center while ensuring maximum continuity of operations for the Warfighter. In other words, each option will be used to accommodate a necessary, separate course of action in the event a new vendor is selected for award. The first six month option period will be used for continuity of operations while a new contractor goes through the various testing and certification procedures for Government acceptance of his system. It will also include the time for a potential protest. (a standard Agency plan of action will be followed if a protest is received) The second six month option period will be used for the actual transition time with the new contractor. MTS Program historical experience in fielding system changes and upgrades in theater dictate a minimum of six

(6) months to schedule and execute system upgrades and provide any required training on system differences. Both contract bridge periods are being requested as options because one or both may not be required if the incumbent with the existing system is determined to be the winner and there is no protest. The requested increase in the contract ceiling price, $226.0M is the minimum required to maintain the Operational Tempo of the program in support of Overseas Contingency Operations (OCO) and Army Force Generation (ARFORGEN) priorities through the end of the current contract and two (2) optional six (6) bridge periods.

The Plan Of Action for the two six month option periods is that their prices will be separately negotiated for incorporation into the basic contract and are to be exercised in accordance with 52.217-9, as were the last two priced options. Options 1 and 2 were exercised by modifications P00006 and P00012, respectively, after the determinations in FAR 17.207(c) were made. The two new six month option periods will be incorporated into the current contract after an inclusion of options determination by the Contracting Officer in accordance with FAR

17.202 and will also be exercised after a determination is made to do so in accordance with FAR 17.207(c).

With the incorporation of the two six month options, the term of the basic contract will be

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 6

a total of 48 months, 12 short of the statutory 60 month limit, and not require the use of 52.217-8 which is typically used for delays in awarding new follow-on contracts. In addition, the option extension allowed at 52.217-8 requires continued performance of any services within the limits and at the rates specified in the contract unless the prevailing labor rates have changed (see FAR 37.111). This does not apply in this case as the two six month option prices will be negotiated to include the labor rates. Also, the fact that this clause limits the extension of services to 6 months suggests it is more appropriate in situations where the statutory 60 month limit has already been reached which is not the case here.

The funding breakdown is as follows:

(Dollars in Millions)

OPA OMA RDT&E TOTAL

Current Contract 15 Mar - 12 Jul 10 Ceiling Request $9.7 $38.5 $0.4 $ 48.6

1st 6 Mo Option Ceiling Request $75.2 $2.4 $0.9 $ 78.5

2nd 6 Mo Option Ceiling Request $78.2 $20.6 $0.0 $ 98.8 $231.1 $61.6 $1.3 $225.9

TOTAL: $226.0

3. Description of Supplies/Services: The estimated total value of this action is $226.0M. The requiring activity is Product Manager, Movement Tracking System (PM MTS), Program Executive Office Enterprise Information Systems (PEO EIS), 800 Lee Ave, Fort Lee, VA 23801.

The Movement Tracking System is a worldwide, data communications capability for locating and managing the movement of logistics and combat support vehicles. MTS provides in-transit visibility and velocity management of logistics and other Army combat support assets anywhere from the sustaining base to the theater of operations. MTS is used to support missions throughout the full range of military operations from peacetime to war and it provides commanders with near real-time data for the location and status of logistics and combat support movements. MTS provides key capabilities to enable and enhance in-transit visibility and velocity management, such as the ability to reroute supplies due to changing priorities, helping to avoid hazards, and maintaining updated unit status. The MTS capability improves the efficiency and effectiveness of the distribution of resources and assets and is a critical enabler for the Warfighter.

This action to increase the ceiling price will allow for the continuation of the procurement of technology to both correct operational logistics issues and position Army logistics for the future.

These procurements will provide satellite terminals, satellite bandwidth, network management services, communications services, engineering services, hardware, and application software.

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 7

For example, the procurement of the hardware is needed to maintain the operational tempo of the program to support the Warfighter and Overseas Contingency Operations (OCO) missions with minimum disruptions, to meet ARFORGEN requirements, and to procure as required software licenses, commercial L-Band satellite power, L-Band protocol, waveforms and bandwidth, earth station and network services, to continue technical support and the Life Cycle replacement of fielded computers. The procurements contemplated under this action would be for foreseen requirements that are documented in the basic contract’s Performance Work Statement (PWS).

However, this action is being requested at this time because the contract maximum is projected to be exceeded earlier than anticipated. The breakout of the proposed periods of ceiling increases are: Current performance period 14 May 10—12 Jul 10 - $48.6M, 1st Optional six (6) month PoP 13 Jul 10—12 Jan 11 - $78.5M, 2nd Optional six (6) month PoP 13 Jan 11—12 Jul 11

- $98.8M (see funding breakdown at paragraph 2 above). Options will be priced and evaluated before executing the modification. The inclusive PoP for all three (3) segments is 14 May 10 when the current contract ceiling is anticipated to expire, until 12 Jul 11, when the transition between the current contract, and the new, competitively awarded contract is anticipated to be fully completed.

4. Authority Cited: 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1. Only one responsible source and no other type of property or services will satisfy agency requirements.

5. Reason for Authority Cited: The particular product, or feature is essential to the Government’s requirements, and market research indicates other companies’ similar products, or products lacking the particular feature, do not meet, or cannot be modified to meet, the agency’s needs, thereby precluding consideration of a product manufactured by another company;

following thorough technical evaluation, only one source is fully qualified to perform the proposed work or provide the needed product. CMDC is the incumbent contractor, and the current MTS has CMDC-proprietary components and restrictive data rights. CMDC has retained the source code and has no authorized resellers. As a result, only CMDC is capable of providing the required supplies and services during the proposed period of performance (PoP) of the two

(2) optional six (6) month contract bridges (13 Jul 10 – 12 Jul 11). Under the current contract, the Government owns the hardware components of the MTS systems it procures (computers, mounting kits, satellite transceivers, and cables). However, the Government does not have either Government Purpose Rights or Unlimited Rights in the CMDC proprietary software, firmware, waveforms, and related technical data that are embedded in the CMDC transceivers, hub equipment, and packet switches. Furthermore, CMDC holds proprietary rights to all Application Program Interfaces (APIs). APIs are routines, protocols and tools that could enable a company other than CMDC to ensure that its systems were compatible with existing fielded systems. The present contract does not require CMDC to provide as a deliverable any data they consider to be proprietary, and that is why the Government cannot demand CMDC provide such data. The Government has examined the feasibility of procuring adequate rights to Application Program Interfaces (APIs) and other proprietary data necessary for a third party to interface with, and become backwards compatible with, currently fielded systems. CMDC considers these APIs and other proprietary data their intellectual property and significant elements of their continuing business operations. In May 06, CMDC stated that its corporate office, Comtech

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 12

Government does not have either Government Purpose Rights or Unlimited Rights in the CMDC proprietary software and related data, a full and open competition is required to achieve a break in dependence on non-competitive acquisitions. However, PM MTS also concluded that, based in part on the results of the RFI, to achieve effective competition, that two (2), optional six (6) month contract bridges, with corresponding contract ceiling increases, will be required to complete events associated with conducting a full and open competition, perform due diligence verification/testing, and to minimize disruptions to the Warfighter during the anticipated system transition that may result from the full and open competition.

7. Actions to Increase Competition:

a. Commercial L-band satellite power and bandwidth, proprietary L-Band earth station hub equipment protocols, waveforms, networks, and transceivers: PM MTS plans to increase competition by moving away from an environment of proprietorship and dependence on sole-source acquisitions, to a competitive contracting approach, i.e., a full and open competitive contract re-compete for commercial L-Band satellite power and bandwidth, L-Band earth station hub equipment protocols, waveforms, networks, and transceivers. The RFP will require prospective offers to propose how they will meet the Government’s objectives of using open standards, providing Government-Purpose Rights as opposed to the use of proprietary components and restrictive data rights. Two of the objectives of this J&A are to ensure there is sufficient time to complete all of the events required for the conduct of a true full and open competition and to ensure continuity of operations and as little disruption as possible to the Warfighter in any contract transition. The timeline for the Full and Open contract re-compete is provided at Attachment B. There is a risk that approval of the commercial L-Band satellite power and bandwidth, L-Band earth station hub equipment protocols, waveforms, networks, and transceivers of any vendor other than CMDC would not occur within twelve months of contract award.

b. Proprietary MTS Software: In 2007, the Army Acquisition Executive and PM MTS made the decision to adopt, for the MTS application software, the logistical variant (MTS-ES) of the Battle Command Product Line (BCPL) core software being developed�under the sponsorship and funding of the Government. The BCPL is an Army Acquisition Executive-directed initiative to leverage product line technology across relevant programs to capitalize on the commonality that exists across several Army and one U.S. Marine Corp (USMC) Systems to achieve economies of scope and production, lower life cycle costs, improve quality, reduce time to field, and enhance interoperability. The Product Line core software is currently in development by Project Manager, Force XXI Battle Command Brigade-and-Below (PM FBCB2) and Northrop Grumman, and the Government will have Government-Purpose Rights to this Product Line software. In 2007, at the time of the execution of the previous J&A to increase the ceiling price and extend the contract, it was expected that MTS-ES would be ready in FY2009.

It is now FY2010, and MTS-ES is still not ready. The BCPL software has experienced a number of delays and is currently still in testing with a projected availability for production release in late FY2011. With successful testing, acceptance, and availability of this software, MTS will no longer need to sole-source CMDC’s proprietary components or require a prime contractor to use

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 13

CMDC as its sub-contractor. Once the BCPL software is released, it will allow for MTS to have open standards, and this is expected to significantly increase competition for future contracts.

However, because the BCPL software will not be available to be provided as a Government Furnished Item (GFI) for the Full and Open Competition, offers will be asked and expected to propose their own open standards, software solution. Once the winning offer’s software solution undergoes successful verification and approval by the Government, fielded systems will be transitioned to this new software. The completion of this transition is targeted for the end of the second contract extension period, 12 Jul 11.

8. Market Research: A Request for Information was posted in the Federal Business Opportunities Page (FEDBIZOPPS) on 3 Feb 09 (Solicitation No. W91QUZ-09-RFI-0001). The notice closed on 6 Mar 09 with 16 responses received. As detailed above in paragraph 6, Efforts to Obtain Competition, there is interest from industry and there is some degree of capability, however, the time it will take to conduct a re-competition exceeds the anticipated date when the current contract’s ceiling price will be reached. Therefore, unless the ceiling price is increased, there will be a gap in supplies and service for MTS.

9. Interested Sources: Sixteen (16) contractors responded to the Request for Information Notice issued on 3 Feb 09, including CMDC. Analysis of the responses resulted in a finding that the majority of respondents are interested in proposing a system solution, and that the successful proposal will likely involve a parallel network and the requirement for a transition period to ramp down legacy network systems and to ramp up the newly established network and systems.

This conclusion supports the strategy for the two (2), six (6) month contract periods. To date, no other sources have written to express interest. The notice required by FAR 5.201 shall be published, and any bids or proposals shall be considered.

10. Other Facts:

a. Procurement History:

(1). Contract Numbers and Dates of Award

- DAAB15-99-D-0014, 6 Jun 99, awarded to COMTECH Mobile DataCom (CMDC), expiration date 12 Jul 07

- W91QUZ-07-D-0018, 29 Jun 07, awarded to CMDC, expiration date 12 Jul 10

(2). Competitive Status of Contract Awards

- DAAB15-99-D-0014, Competitive, eight year, FFP, IDIQ contract

- W91QUZ-07-D-0018, J&A for Other than Full and Open Competition, 3 year follow-on of the FFP, IDIQ contract

(3). Authority Previously Used for Less than Full and Open Competition

- W91QUZ-07-D-0018, 10 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”

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 14

(4). Summary of Para 7 (Actions to Increase Competition), Previous J&A and Results

( W91QUZ-07-D-0018)

- Proprietary MTS Software _ In June 2006, the Army Acquisition Executive made the decision, based on the recommendations of a case analysis, that MTS would adopt the Battle Command Product Line (BCPL) software with logistics functionality (MTS-ES) as its future software (assuming successful completion of development, testing, and acceptance) See Attachment C. This BCPL software was being developed by Northrop Grumman under the sponsorship and funding of PM FBCB2 and would come with Government-Purpose Rights which would have meant adequate rights such that other sources could potentially provide products and services that would be compatible with existing systems. However, the availability of this BCPL software, originally anticipated for FY2009, has experienced several schedule slips. It is currently in testing with current projections for production release in FY2011 which is six months past the period of performance of the current MTS Contract. As a result, the strategy articulated in this J&A of a full and open competition supported by two (2), six (6) month contract options is being proposed to mitigate the further slippage in the availability of the BCPL MTS-ES software by requiring offers to propose their own solution for software with the required logistics functionality. The winning software will bridge the gap until the MTS-ES software is available and accepted.

- Commercial L-Band Satellite Power and Bandwidth _ It was anticipated that by FY2010, DISA would be able to provide commercial L-band satellite power and bandwidth through commercial contracts they would compete and manage, however, our understanding to date is that commercial L-band satellite power and bandwidth are still not available through DISA. As a result, there is no change in the potential opportunity for increased competition among perspective offers.

- Proprietary L-Band Earth Station Hub Equipment Protocols, Waveforms, Networks, and Transceivers _ On 28 Jun 06, a Deputy Under Secretary of Defense, SAAL-ZS (Advanced Systems and Concepts), Office of Technology Transition memorandum (See Attachment D) documented the Army’s intent to fund an initiative under the Defense Production Act to help satisfy evolving Army needs for the mass-production and fielding of an advanced, L-Band Satellite Transceiver (includes necessary enhanced support infrastructures – earth station, hub equipment, networks, etc) to meet the growing needs for Blue Force Situational Awareness Technology (includes MTS technology), that would be programmed through software to run current and advanced protocols and waveforms, and could be programmed to meet interoperability requirements. It was anticipated that the use of Government-defined standards for interface and interoperability would enable these systems to interface with, and be interoperable with the fielded MTS. The original availability of this product was projected for late FY2009, however it is in the advance prototyping stage and is seeking to build customer interest and support before moving forward. If the decision is made to move forward, the anticipated earliest availability would be 2 - 2.5 years which is well beyond the period of performance of the current MTS Contract. As a result, this full and open competition supported by two (2), six (6) month contract options will require offers to propose their own solution for L-

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 15

Band Earth Station Hub Equipment Protocols, Waveforms, Networks, and Transceivers.

(5). Changed Circumstances Since Original Award (F&O)

- Proprietary MTS Software - The Army is pursuing the development of a Product Line of software with logistics functionality (MTS-ES) as the future MTS software (assuming successful completion of development, testing, and acceptance). This software is being developed by Northrop Grumman under the sponsorship and funding of PM FBCB2 and will come with Government-Purpose Rights which will mean adequate rights such that other sources could potentially provide products and services that would be compatible with existing products and services which should provide opportunities for increased competition.

- Commercial L-Band Satellite Power and Bandwidth _DISA is still not able to provide commercial L-band satellite power and bandwidth through commercial contracts. In this area, there is no change in the potential opportunity for increased competition among perspective offers.

- Proprietary L-Band Earth Station Hub Equipment Protocols, Waveforms, Networks, and Transceivers _ The Army has announced the intent and has started an initiative for the development, mass-production and fielding of an advanced, L-Band Satellite Transceiver. (See paragraph 10.a.(4) above.

(6). Unusual Patterns _ N/A

(7). Circumstances Justifying Previous Buy and Significant Changes _ Paragraphs 2, (Description of Action) and 10a(1-3) (Other Facts) include information on the contract number, date, and previous Sole Source award. To elaborate, this contract was awarded on an Approval of Justification for Other than Full and Open Competition basis using 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1, “Only one responsible source and no other supplies or services would satisfy agency requirements” (Attachment E). While it was recognized prior to the award of the August 2007 contract that the Government had only those license rights customarily provided to the public and that it did not have adequate license rights in contract deliverables such that other sources could provide the required backward compatibility, it was anticipated that the availability of several products, such as MTS ES in FY2009, in which the Government would have adequate rights, would be the way-ahead. The three products that were to be available in FY2009 that would significantly increase the opportunity for competition for future MTS contracts in FY2010 and beyond were: Software with Government-Purpose Rights (Battle Command Product Line (BCPL) software (MTS-ES), an advanced L-band, programmable, software-definable Transceiver, and DISA provided commercial L-band satellite power and bandwidth. See paragraph 10a(4) above for significant changes in these areas.

b. Acquisition Data Availability. See paragraph 5, Reason for Authority Cited.

c. Unusual and Compelling Urgency. Not applicable.

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 16

d. Competition in Subcontracting. FAR 52.219-8, Utilization of Small Business Concerns and FAR 52.244-5, Competition in Subcontracting, is included in the contract.

FOR OFFICIAL USE ONLY - PROCUREMENT SENSITIVE 18

Approval

Based on the foregoing justification, I hereby approve the procurement of supplies and services for the Movement Tracking System (MTS) program via an increase in the ceiling of Contract No. W91QUZ-07-D-0018 in the amount of $226.0M, which includes the establishment of two (2), six (6) month contract option periods of performance to support the completion of a competitive contracting approach, on a full and open competition basis. This justification is on an other than full and open competition basis pursuant to the authority of 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1 subject to availability of funds, and provided that the services and property herein described have otherwise been authorized for acquisition.

Date: ___________________ Signature:_____________________________ Malcolm R. O’Neill Senior Procurement Executive