Supply Chain Funds Administrator

Federal Communications Commission
Enterprise Acquisition Center
EXCEPTION TO FAIR OPPORTUNITY
IN ACCORDANCE WITH FEDERAL ACQUISITION REGULATION (FAR) 16.505(b)(2)(ii)(B)
Supply Chain Reimbursement Program
Administration
1. Identification of the agency and the contracting activity, and specific identification of the
document as a "Justification for an Exception to Fair Opportunity.”
This justification was prepared in accordance with FAR 16.505 by the Federal Communications
Commission (FCC), Headquarters (HQ), Office of the Managing Director (OMD), Enterprise
Acquisition Center (EAC) located at 45 L Street NE, Washington, DC 20554. The managing
program is the Office of the Managing Director (OMD).
2. Nature and/or description of the action being approved.
The purpose of this requirement is to award a contract for a logical follow on to Task Order
273FCC21F0121 for the Supply Chain Reimbursement Program. The proposed action involves the
delivery of professional services, including program management, to assist the FCC in
administering the Secure and Trusted Communications Networks Reimbursement Program
(“Reimbursement Program” or “Program”) and processing reimbursement claims. Among other
tasks, the contract will perform the following program areas related to the Reimbursement Program:
strategic planning and outreach; processing payment requests; communications and outreach; data
management, analytics, and reporting; program compliance; and program management. This work
is necessary to continue to execute the Reimbursement Program, described in more detail below.
Because of the unique nature of the work involved to administer this program created pursuant to
the Secure Networks Act, the FCC has concluded it is appropriate to continue with the existing
contractor of these services, which has developed the particular expertise required to administer
this program efficiently and effectively. It is not likely that a new contractor would be able to ramp
up and gain the expertise to be able to perform the requirements under the timeframes required.
The Period of Performance for the new contract will be a Base Period from 5/3/2024-5/2/2025
and add two additional 1-year option periods 5/3/2025 -5/2/2026, and 5/3/2026 - 05/02/27.
3. A description of the supplies or services required to meet the agency’s needs (including the
estimated value.
The Secure and Trusted Communications Networks Act of 2019 (Secure Networks Act) directed the
FCC to establish the Secure and Trusted Communications Networks Reimbursement Program

(Reimbursement Program) to fund the removal, replacement, and disposal of covered
communications equipment or services that pose an unacceptable risk to the national security of
the United States or the security and safety of U.S. persons from the networks of providers of
advanced communications service. Specifically, recipients of Reimbursement Program funds may
use these funds to (1) permanently remove covered communications equipment and services from
their networks, (2) replace the covered communications equipment and services with non-covered
equipment or services, and (3) dispose of the covered communications equipment and services in
accordance with the Secure Networks Act. To access available funds, Reimbursement Program
participants must file applications based on cost estimates for the costs for the removal,
replacement, and disposal of covered communications equipment or services. On December 27,
2020, the President signed into law the Consolidated Appropriations Act, which, among other
things, appropriated $1.9 billion to carry out the Reimbursement Program
The Commission contracted with a third party to serve as Reimbursement Program Administrator
(Administrator), who is tasked with assisting the FCC by reviewing and providing recommendations
as to whether, among other things, applications submitted for reimbursement are complete,
whether the applicants are eligible to participate in the Reimbursement Program, and whether,
after reviewing relevant cost documentation, the expenses reported for the removal, replacement,
and disposal of covered equipment or services are eligible for reimbursement. Once the initial
applications are approved, the FCC issues funding allocations as expenses are incurred. Prior to
disbursing funds, the Administrator must review and approve submitted requests by recipients that
include documentation of costs. Once granted funding, recipients then must complete the removal,
replacement, and disposal process within a set period of time.
Submission of Cost Estimates. To participate in the Reimbursement Program, eligible providers
were required to submit initial estimates of the costs to be reasonably incurred for the removal,
replacement, and disposal of covered communications equipment or services to participate in the
reimbursement program. Participants were also statutorily required to submit, in addition to cost
estimates, “supporting materials substantiating the costs,” a “specific timeline . . . for the
permanent removal, replacement and disposal of the covered communications equipment or
services,” and the certifications required by section 4(d)(4) of the Secure Networks Act as to the
development of a transition plan and the use of funds if approved and in developing and tailoring
risk management practices.
Funding Allocation Stage. After an applicant has submitted estimated cost forms, the FCC’s
Wireline Competition Bureau (Bureau), with the assistance of the Administrator, reviewed the
submitted applications for completeness, the applicant’s eligibility for reimbursement, and the
reasonableness of the cost estimates provided. Funding was then allocated accordingly. The
funding amount allocated represents the maximum amount eligible for draw down by an eligible
provider unless a subsequent funding allocation is made.
Funding Disbursement Stage. Following the allocation of funds to eligible providers and after
eligible providers incur actual costs, recipients must file reimbursement claims along with any
required supporting invoices and other cost documentation, as directed by the Bureau, to obtain

reimbursement requests as they incur expenses throughout the reimbursement period. The
Bureau, with the assistance of the Administrator, reviews reimbursement claims to ensure that
disbursements are made only for costs reasonably incurred.
Estimated Value: Base + Options = The independent cost estimate (IGCE) projects an estimated 3-years
maximum potential value of $25,636,724.97.
􀁸􀁸 Base Period: 5/3/2024-5/2/2025; $8,855,968.06
􀁸 Option Period 1: 5/3/2025-5/2/2026; $9,208,206.78
􀁸 Option Period 2: 5/3/2026-5/2/2027; $7,572,550.13
Contract Total: $25,636,724.97
4. An identification of the exception to fair opportunity rationale and the supporting rational,
and if applicable, a demonstration of the contractor’s unique qualifications to provide the
required supply or service. If the contracting officer uses the logical follow-on exception, the
rationale shall describe why the relationship between the initial order and the follow-on is
logical (e.g., in terms of scope, period of performance, or value).
FAR 16.505(b)(2)(i)(B) – Only one awardee is capable of providing the supplies or services required
at the level of quality required because the supplies or services ordered are unique and highly
specialized.
The brief timelines created by the Secure Network Acts and the later Consolidated Appropriations
Act of 2020 has resulted in an urgent and compelling need to expeditiously execute the
Reimbursement Program to its completion. For the reasons explained below, conducting even a
limited competition for a contract for the Administrator of the Reimbursement Program is not
feasible.
The existing Administrator, which has administered the Program since inception, has developed the
particular expertise necessary to carry out the requirements of this Program effectively and
efficiently, and its replacement by a new Administrator would significantly hinder the Program’s
ongoing operations. Specifically, there is a critical need to ensure the Program continue its
operations uninterrupted and without unnecessary complications, which, given the complexity of
the Program, would not be possible in the event that the Administrator is replaced at this point in
time. By way of example, among other things, the Program Administrator must adhere to an
existing Program Readiness Plan for reviewing and analyzing claims documentation submitted by
eligible providers for reimbursement of removal, replacement, and disposal costs, which includes
comprehensive operational readiness assessments for pre-disbursement, application, and
disbursement phases, and follow an existing Reimbursement Process Workflow to standardize and
track reimbursement requests and money disbursed from the Reimbursement Fund. Notably, the
existing Administrator has designed and documented high-level and detailed business processes

and workflows in the required format to ensure effective, efficient, and successful fulfillment of the
scope, mission, and milestones related to disbursements for the Reimbursement Program, which
include the following: tracking of reimbursement claims and payments, including tracking key dates
associated with each claim filed by every fund recipient; analyzing estimated costs; reviewing and
approving expense documentation; monitoring and compliance standards; cost reconciliation;
recipient final accounting and close-out; reporting; data validations; internal controls; responding
to external audits; and site visits.
With regard to internal controls, the existing Administrator has developed and maintained
documentation to govern the reimbursement process that is sufficient for the Commission to
comply with the Payment Integrity Information Act and a OMB Circular A-123 audit. With regard to
processing payment requests, the Administrator has developed a complex process for reviewing
multiple Reimbursement Forms submitted throughout the contract term, which includes an initial
review of submitted Reimbursement Forms to ensure information accuracy, completeness, and
fulfillment of the eligibility criteria and requirements, contacting entities that submit incomplete
forms, and making recommendations to the Commission whether expense submissions meet the
standard of being allowable and reasonable based on each entity’s individual circumstances.
Instructing a potential new Administrator on the preparation and use of these processes and
workflows would be time-intensive and result in significant inefficiencies and errors, and hinder the
Commission’s ability to meet and complete the goals of the Program in an accurate and timely
manner.
5. A determination by the contracting officer that the anticipated cost to the Government will
be fair and reasonable.
GSA has already determined the Labor rates for services offered to be fair and reasonable under its
Schedule contracts. The Contractor is using competitive rates established on the OASIS GWAC, and
the using activity has reviewed the proposed number of Labor Hours and Labor Mix to ensure that
it is adequate and appropriate for the tasks required for continued performance. The Contracting
Officer has sought additional discounts from the vendor’s schedule contract rates and prices to
ensure that the Government receives the best value. An independent government estimate (IGCE)
was prepared and compares favorably to the contractor’s proposed pricing. As more fully described
herein, Ernst & Young is well qualified and best suited in these circumstances to conduct the
implementation of the Reimbursement Program based on its prior directly relevant experience, and
the fact that it assisted the Commission to develop the policies and procedures for the filing and
processing of reimbursement requests, and therefore is deeply familiar with the steps needed to
execute the Program and be able to commence that effort immediately.
6. Any other facts supporting the justification. N/A
7. A statement of the actions, if any, the agency may take to remove or overcome any barriers
that led to the exception to fair opportunity before any subsequent acquisition for the
supplies or services is made.

While this is a time-critical acquisition resulting from specific statutory requirements of the Secure
Network Act, the requirement is expected to be non-recurring. Given the time left for full execution
of the Program, and potential transition costs and disruptions, it is unlikely that sufficient
procurement administrative lead time exists to recompete the requirements before Program
completion. Nevertheless, if the Program should continue past the period of performance for the
subject contract with option years, the Commission will review the situation in its entirety and make
a determination to recompete the requirement should program conditions, experience with the
instant contract, and the competitive environment make that the best course for the Government.
8. The contracting officer's certification that the justification is accurate and complete to the
best of the contracting officer's knowledge and belief and evidence that the supporting data
that form a basis for the justification have been certified as complete and accurate by
technical/program personnel.

Awarded contract 273FCC24F0052 to unknown vendor for unknown amount on 2024-05-01.