ALEP_Block_2_Follow-on_JA__Redacted.pdf

FOR OFFICIAL USE ONLY

JUSTIFICATION FOR OTHER THAN

FULL AND OPEN COMPETITION

I. CONTRACTING ACTIVITY

Department of the Air Force Air Force Materiel Command Air Force Life Cycle Management Center Human Systems Division 1981 Monahan Way, Bldg. 12 Wright Patterson, AFB, OH 45433-7017

II. NATURE AND/OR DESCRIPTION OF THE ACTION BEING PROCESSED

A. This Justification and Approval (J&A) implements 10 U.S.C. 2304(c) (1) Other than Full and Open Competition, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements IAW FAR 6.302-1(a)(2)(ii). This J&A outlines the United States Air Force (USAF) continued requirement to purchase the Aircrew Laser Eye Protection (ALEP) Block 2 system. This requirement will be fulfilled under contract FA8606-15-C-6370, a new Firm-Fixed Price (FFP) contractual vehicle.

III. DESCRIPTION OF THE SUPPLIES/SERVICES REQUIRED TO MEET THE

AGENCY’S NEEDS

A. Air Force aircrew members require an ALEP system for day and night applications that balance requirements for laser eye protection, mission/aircraft compatibility, and flight safety.

The ALEP Block 2 system provides aircrew members with enhanced protection against hazard and threat laser devices in combat and training situations while minimizing visual acuity degradation. The ALEP Block 2 system also provides sufficient protection to prevent permanent eye damage and temporary effects (glare, flash blindness, etc.) from laser weapons/devices. The Block 2 system is mostly compatible with current aircrew flight equipment, cockpit/cabin displays, exterior aircraft lights, and airfield lights, night vision devices, helmet mounted displays, and exterior scenery.

The ALEP Block 2 system comes in two variants (for day or night use), each in three sizes (small, medium, and large), and includes an optional prescription outsert for aircrew that require vision correction. The three sizes provide a personalized fit that positions the laser eye protection (LEP) filter at the proper angle and location for optimal visual performance as well as laser protection. The spectacles are sized and fitted to the aircrew member based on the distance between the member’s pupils. The prescription outsert is available in the same three sizes and attaches to the nose bridge of the ALEP Block 2 spectacle. The prescription outsert is ordered through the member’s optometry clinic.

B. Under the contemplated contract, the USAF will award a five-year, firm-fixed price contract (base year and four option years) and will procure ALEP assets during the five-year period from the incumbent contractor, Teledyne Scientific and Imaging, LLC. Teledyne will provide ALEP

Block 2 supplies consisting of 11,805 spectacles, 63 fitting frames, and 592 repair kits at an estimated cost of . This estimate is based on the average historical cost of previous ALEP Block 2 purchases using an inflation factor for the base year and future option years. The estimated period of performance is 1 November 2015 through 30 October 2020, and 3080 appropriations will fund this effort. The period of performance is based on the buy-to-budget funding profile listed below.

FUNDING $M

FY

FY

FY

FY

FY

FY

TOTAL

TOTAL

IV. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN

COMPETITION

10 USC 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(ii) only one responsible source and no other supplies or services will satisfy agency requirements.

FAR 6.302-1(a)(2)(ii)(A&B) states:

(ii) Supplies may be deemed to be available only from the original source in the case of a follow-on contract for the continued development or production of a major system or highly specialized equipment, including major components thereof, when 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.

(B) Unacceptable delays in fulfilling the agency’s requirements.

V. DEMONSTRATION THAT THE CONTRACTOR’S UNIQUE

QUALIFICATIONS OR NATURE OF THE ACQUISITION REQUIRES THE USE OF

THE AUTHORITY CITED ABOVE (APPLICABILITY OF AUTHORITY)

A. ALEP Block 2 system provides aircrew members with enhanced eye protection against hazard and threat laser devices in combat and training situations while preserving visual acuity and color recognition. The ALEP Block 2 system also provides ample protection to prevent permanent eye damage and the temporary effects (glare, flash blindness, etc.) from laser weapons/devices. The capabilities of the ALEP Block 2 system result from the meticulous integration of requirements throughout the design, development, test, and qualification processes.

The Block 2 system is fully compatible with the Air Force fleet and all current aircrew flight equipment (AFE) and meets or exceeds both the Day and Night performance requirements. The Block 2 system is visually compatible with night vision devices, helmet mounted displays, cockpit/cabin displays and lights, exterior scenery, aircraft lights, and airfield lights.

The ALEP Block 2 system supports multiple systems and is not unique to a specific aircraft, helmet, or other AFE. The design and development meets the requirement for LEP integration into many aircraft and AFE with an emphasis on visual and physical compatibility.

The current ALEP Block 2 contract was solicited under FA8904-05-R-1001. A single responsive offer was received resulting in award of the development contract FA8902-06-C- 1002 to Teledyne Scientific and Imaging, LLC on 26 May 2006. Prior to award of the production phase, a Request for Information was posted on Federal Business Opportunities on 4 June 2009. No responses were received so a sole-source J&A, IAW FAR 6.302-1, was approved for the production phase to Teledyne Scientific and Imaging, LLC. on 20 April 2010. Under FA8902-06-C-1002 Block 2 production CLINs, the government has procured 8,970 spectacles consisting of 470 Low Rate Initial Production (LRIP) units and 8,500 Full Rate Production (FRP) units. The period of performance for FA8902-06-C-1002 ended on 31 January 2015.

This fulfilled the quantity outlined in the April 2010 J&A.

However, the initial Block 2 requirement, outlined in part 12 of the ALEP Block 2 Capabilities Production Document (CPD) dated 15 April 2009, was for 16,234 FRP spectacles with the associated required repair kits and fitting frames. At the time the J&A was approved in 2010, ACC determined there was an immediate need for 8,500 FRP units. The total requirement of 16,234 units from the CPD could not be completely verified and would need to be reviewed after delivery of the initial 8,500 FRP units. On 9 May 2014 the user reevaluated the status of ALEP distribution and identified an increased need based on additional aircraft, bases, and users that the follow-on contract will need to include. The total number of Block 2 spectacles to be purchased was determined to be 21,156 units instead of the initial 16,234 units. On 29 July 2014, ACC realized an immediate need for 851 spectacles. This required a modification to the existing contract for the additional spectacles, which extended the period of performance on the initial contract to March 2016. This action reduced the total number of spectacles for the follow-on contract to 11,805 units.

ALEP Block 2 is highly specialized equipment that incorporates state-of-the-art thin film dielectric filter elements and unique absorptive dyes to meet a multitude of competing requirements and delivers a high performance laser eye protection spectacle. ALEP Block 2 system consists of a Day Variant and a Night Variant, each optimized to meet the demanding requirements of aircraft/AFE compatibility, laser eye protection, and visual performance in their respective day or night environment. The manufacturing methods are also highly specialized and require precision process controls, accurate management of the deposition environment, and dedicated focused touch labor. Teledyne has matured and stabilized these production processes and has provided consistent deliveries on schedule. This acquisition for the remainder of the user’s original and revised requirements is deemed available only from the original source since award to any other source would result in substantial duplication of costs and unacceptable delays if re-competed.

This system has been in production for over three years now with 9,081 ALEP Block 2 spectacles successfully produced and deployed to the field through January 2015. The Block 2 design incorporates two technologies, absorptive dyes and reflective dielectric coatings. The dielectric coatings are the essential component to meeting the complex requirements. There are no commercial off-the-shelf solutions that fulfill the government’s requirements and no other company has manufactured laser eye protection spectacles using a dielectric coating at such a large scale. In addition, Teledyne has a product that has completed Force Development Evaluation operational testing and has been deployed and demonstrated out in the field.

Operators and maintainers have been trained on how to use, fit, and repair this system. No other offerors can match this level of readiness, as further detailed in sections VI and VIII below.

Therefore, this acquisition will be a follow-on contract for the continued production of highly-specialized equipment.

B.

In addition, the contractor has extensive knowledge of processes and procedures needed to produce such a highly specialized product. This reduces impact sustained from the learning curve associated with highly technical manufacturing processes.

C. The Agile Combat Support Directorate believes that award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition and unacceptable delays in fulfilling the Air Force’s requirements.

1. Duplication of Cost: In order to fulfill the entire ALEP Block 2 requirement, a follow-on contract to Teledyne is necessary. To date the government has expended over an eight-year fiscal period (FY06-FY13) to develop, qualify, and manufacture the ALEP Block 2 system. Teledyne has been the prime contractor for the entire effort. The government spent to develop and test Teledyne’s Laser Eye Protection (LEP) system as seen below.

ALEP Block 2 Development & Test Expenditures

Fiscal Year (FY) Expenditure

FY06

FY07

FY08

FY09

FY10

Total

Additionally, the government invested another million dollars on a manufacturing and yield improvement program with Teledyne. The Government estimates in duplicative costs, as delineated in the table below, that would be realized if this effort was re-competed. This estimate is based on the actual cost for ALEP Block 2 System Development and Demonstration, Low Rate Initial Production, and Initial Operating Test and Evaluation (IOT&E) Support multiplied by the estimated percent of duplication including inflation and learning curve factors. The laser eye protection industry has further improved laser eye protection technology which has decreased the overall development time for another company, but there is still at least one year of development required to produce a spectacle of the same quality and qualifications as what the government currently receives. Engineering subject matter experts at the program office and at AFRL/RXAP have determined the estimated duplication percentage to be for System Development and Demonstration. AFRL/RXAP is a subject matter expert in the laser eye protection industry and continuously connects with companies in this field to evaluate their level of technology development. The engineers estimate the development duplication cost is based on the current level of technology and the growth required to produce ALEP Block 2 spectacles. Cost estimators estimate an inflation rate of based on inflation tables rates from 2006 to present day. A contractor would also be required to demonstrate Low Rate Initial Production (LRIP) and IOT&E to the same degree as Teledyne did, which would represent of the duplication costs. The inflation rate of would also be included to bring then-year prices to current day. The total percentage of duplication for LRIP and IOT&E is

Duplication of Contractor Costs

Description of SOW Task Then-Year

Rough Price % (est.)

Duplication Total Price

SOW 26 May 06 ALEP Block 2 System Development and Demonstration

Low Rate Initial Production (LRIP) Phase 1

IOT&E Support Total

*Then-Year Rough Prices are derived from the ALEP Block 2 development contract. Duplication percentages are derived from the engineering estimate for the product to be developed to Milestone B in addition to inflation and learning curve factors.

In addition to the above development costs, the government would have to repay for tooling and equipment, employee training, and manufacturing demonstration runs.

2. Unacceptable Delay: The overall time the government spent on contract with Teledyne to produce the current laser eye protection spectacle is 1,745 days (~58 months), as follows:

- Develop, coordinate and issue Solicitation .................................................. 45 days

- Industry proposal preparations ..................................................................... 60 days

- Engineering Manufacturing & Development thru DT&E and MSC ........ 1,095 days

- Low Rate Initial Production (including OT) ................................................. 365 days

- Total Initial Development ...................................................................... 1,565 days

Based on technology improvements in the laser eye protection industry, the overall development time has been reduced, but the timeline to return to the present state of ALEP Block 2 in a re-competitive environment is estimated to be 1,178 days (~39 months), as follows:

- Initial Planning Activities ............................................................................. 50 days

- Market Research ........................................................................................... 43 days

- Strategy Development ................................................................................... 112 days

- Draft RFP ...................................................................................................... 160 days

- Formal RFP ..................................................................................................... 48 days

- Source Selection............................................................................................ 120 days

- Post-Award Debriefing Functions .................................................................. 23 days

- Engineering Manufacturing & Development thru DT&E and MSC ........... 365 days

- Low Rate Initial Production (including OT) ................................................. 365 days

- Total Delay ............................................................................................... 1,178days

There is an increasing demand from aircrews for laser eye protection and ACC has determined that deliveries from the ALEP Block follow-on contract will need to begin by January 2016.

AFLCMC/WNUV would therefore need to award the contract by October 2015 because of the 2- 3 month lead time for spectacle materials. The field cannot afford a delay of 39 months to bring another contractor up to the same level of production that Teledyne currently provides.

The total delay to return to the same product the government is currently receiving is determined by engineering subject matter experts at the program office and at AFRL/RXAP. AFRL/RXAP is a subject matter expert in the laser eye protection industry and continuously connects with companies in this field to evaluate their level of technology development. These engineers determined that any contractor would be at least a year from developing current ALEP Block 2 spectacles qualified with the required Aircrew equipment in the required aircraft. The Acquisition Center of Excellence provided guidance on the timeline to develop, coordinate and issue the contract solicitation, prepare industry proposals, and conduct the source selection.

Additionally, the government would also need to consider the cost and schedule impact from testing and logistics/sustainment. The Teledyne ALEP Block 2 system was successfully tested on 43 different aircraft mission design series over a two year period. A new ALEP system would have to be retested on all these aircraft and with all other aircrew flight equipment (i.e. helmet, oxygen mask, helmet mounted display, etc.). Furthermore, a new ALEP system would add unnecessary work for maintainers and aircrew. Maintainers would have to be trained on how to fit and maintain both systems and maintain additional repair kits/tools. Aircrew would also need to be trained on the differences in the two systems.

The government cannot afford a delay of laser eye protection due to the threat and continuous aircrew capability need. There is an increasing threat of damaging laser incidences due to the ease of acquiring commercial lasers and the relatively low costs associated with them. There is especially a growing threat in deployed locations in the Middle East, where aircraft are most susceptible to lasers during take-off and landing. The availability of ALEP to aircrew greatly reduces the damaging effects of being lased, and a lapse in spectacle delivery would put aircrew at risk of temporary blindness or retinal damage and therefore, affects safety of flight operations.

The initial contract purchase of 8,500 FRP spectacles were delivered to bases and aircrafts that were deemed to be the most critical based on a vulnerability matrix that ranks aircraft and units according to their critical need score. The critical need score considers mission vulnerability, operational vulnerability, aircraft self-lasing vulnerability, current AELP vulnerability, and the mission profile and is based on the assumption that every aircrew member who looks out of the aircraft would don ALEP. ALEP is provided to every aircrew member who looks out of the aircraft including the pilot, co-pilot, and others depending on the aircraft. Each aircrew member has both the day and night spectacle. The ranking of critical bases and aircraft has changed since the fielding plan was first implemented in 2010 and includes additional aircraft which were not considered in the original fielding plan, such as the MC-12. The UH-1N, B-52, C-5, and C-17 at select locations have moved up to the top of the criticality list. In addition to an updated critical need list, there is a capability gap created by some of the units only receiving either the day or the night spectacle variant. It is imperative to have both Block 2 day and night variants in order to be visually protected during all required missions. Completing the units with either the required day/night variant would make these units whole. The units would be able to successfully complete their missions without the threat of eye damage due to lasing incidences.

D. Accordingly, Teledyne is the only firm capable of providing the supplies and services described above without the USAF experiencing substantial duplication of cost that could not be expected to be recovered through competition and unacceptable delays in fulfilling its requirements.

VI. DESCRIPTION OF EFFORTS MADE TO ENSURE THAT OFFERS ARE

SOLICITED FROM AS MANY POTENTIAL SOURCES AS DEEMED PRACTICABLE

In preparation for the follow-on action, Sources Sought Synopsis WNUK-13-008, was electronically posted to Federal Business Opportunities (FBO) on 17 May 2013, seeking companies that could fulfill the ALEP Block 2 FRP follow-on requirements. The government received responses from four companies, Teledyne Scientific and Imaging, LLC; Gentex Corporation, 3M, and Honeywell. To follow up with the May 2013 Sources Sought Synopsis, the government released a Sources Sought Synopsis, WNUK-15-001, on 2 Oct 2014. The government received responses from two companies, Teledyne Scientific and Imaging, LLC and Gentex Corporation. Of these vendors, Teledyne Scientific and Imaging presented the only mission ready product with the capability to begin immediate production. Gentex Corporation has the potential of integrating the needed technologies, however would require additional development in order to meet the same quality of LEP coatings and performance levels required by this effort. The three identified companies also do not have access to the Out-of-Band coating process, which is the critical and most difficult aspect of laser eye protection manufacturing.

Teledyne owns the process licensing for this specialized process. The government did not purchase the data rights because ALEP is an evolutionary acquisition program and it was not determined cost-effective to obtain the data rights. Only Teledyne Scientific and Imaging can provide a proven product that will require no development, performance trade-offs, testing, integration, manufacturing ramp-up, or production delays. Gentex Corporation would require additional costs and schedule for EMD, DT&E, MS C, LRIP, and OT before their product can be delivered.

Additionally, the Government team spoke with AFRL/RXAP concerning the current condition of the marketplace. AFRL/RXAP is a subject matter expert in the laser eye protection industry and continuously connects with companies in this field. In an email sent to the program manager on 18 July 2014, they confirmed that no company, other than Teledyne Scientific, can produce the spectacles with the current government specifications. The other companies that responded to the Sources Sought Synopses would require at least a year of development and would still have no guarantee of meeting current requirements. No other company is currently able to apply dielectric coatings with the success that Teledyne has demonstrated and to the performance level achieved in the current ALEP Block 2 spectacles. Based on our market research and consultation with AFRL/RXAP, Teledyne is the only vendor able to successfully produce dielectric coatings for LEP in large scale manufacturing runs that meet the government’s high performance specifications.

VII. DETERMINATION BY THE CONTRACTING OFFICER THAT THE

ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE

This effort will be a new firm-fixed-price follow-on contract to an existing firm-fixed-price contract. The contracting officer will ensure the cost of this acquisition will be fair and reasonable to the government in accordance with FAR 15.4. The program office has resources available in-house to accomplish detailed engineering/technical analysis.

A technical evaluation will be performed to determine whether the labor costs proposed are reasonable for the effort at hand and appropriate. If the contractor has a forward price rate agreement, those rates will be utilized as part of the Air Force objective. If no forward pricing rate agreement exists, an interim price recommendation will be utilized as well as the use of historical pricing for comparison. These recommended rates provided by the Defense Contract Management Agency can be used to help establish fair and reasonable direct labor rates. In accordance with the Truth in Negotiations Act, the contracting officer will obtain certified cost and pricing data as required by FAR 15.403 as appropriate to ensure that the contractors’ proposed costs are current, accurate, and complete. These measures will ensure that the contracting officer can certify the contract costs and price arrangements as being fair and reasonable to the government.

VIII. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE

RESULTS, OR A STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT

CONDUCTED

As described in Section VI above, market research, in accordance with FAR Part 10, was conducted by synopsis of the proposed acquisition; advising industry of the pending acquisition and soliciting inquiries form interested parties.

In addition to the Sources Sought solicitation, research was conducted by engaging Government subject matters experts in the laser eye protection field. The ALEP Program Office contacted AFRL/RXAP, which, through their industry contacts and knowledge base, confirmed that no significant technology changes or new potential manufacturing sources have been identified which would affect the current ALEP follow-on effort.

IX. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND

OPEN COMPETITION

The ALEP Block 2 production specifications were written based on the development program worked with Teledyne. Information was leveraged from Teledyne’s development effort and combined with user requirements to produce the current spectacle specifications.

X. LIST OF SOURCES, IF ANY, THAT EXPRESSED INTEREST IN THE

ACQUISITION

See Section VI above.

XI. A STATEMENT OF THE ACTIONS, IF ANY, THE AGENCY MAY TAKE TO

REMOVE OR OVERCOME ANY BARRIERS TO COMPETITION BEFORE MAKING

SUBSEQUENT ACQUISITIONS FOR THE SUPPLIES OR SERVICES REQUIRED

This follow-on effort will be the final procurement for the ALEP Block 2 variant. The ALEP acquisition strategy is to provide ALEP devices using continuous evolution to address the changing threat and to take advantage of the latest advancements in laser protection technologies.

Barring any urgent and compelling reasons, subsequent acquisitions beyond ALEP Block 2 will be fully competed. To that end, the next acquisition of ALEP is a Block 3 Day variant using all-dye technology. With new dyes currently being researched in the market, the Day variant, in both the spectacle and visor formats, will become a product that can be produced by multiple vendors. At the moment, the production of ALEP Night variants remains highly specialized and requires further development for application to visors for Block 3. Nevertheless, the government intends to fully compete ALEP Block 3 as the marketplace continues to make technological advances in laser eye protection. Furthermore, the government intends to explore the purchasing of data rights, as necessary, for ALEP Block 3. The Government understands the advantages of owning such technical data rights and will make a concerted effort to perform a cost/benefit analysis of purchasing such data rights.

XII. CONTRACTING OFFICER’S CERTIFICATION

The contracting officer’s signature on the signature page evidences that he/she has determined this document to be both accurate and complete to the best of his/her knowledge and belief (FAR 6.303-2(b)(12)).

XIII. TECHNICAL/REQUIREMENTS PERSONNEL’S CERTIFICATION

As evidenced by their signatures on the signature page, the technical and/or requirements personnel have certified that any supporting data contained herein which is their responsibility is both accurate and complete (FAR 6.303-2(c)).

COORDINATION AND APPROVAL DOCUMENT

CONTRACTING ACTIVITY: Human Systems Division (AFLCMC/WNU) PROGRAM/PROJECT: Aircrew Laser Eye Protection Block 2 AUTHORITY: 10 USC 2304(c)(1), as implemented by FAR 6.302-1(a)(2)

ESTIMATED CONTRACT COST:

TYPE PROGRAM: ACAT III Program TYPE J&A: Individual

APPROVED: