CETS

JUSTIFICATION REVIEW DOCUMENT Contracting Activity: Aeronautical Systems Center, Enterprise Acquisition Contracting Division Purchase Request/Local Identification Number: N/A Project/Program Name: Contractor Engineering and Technical Services (CETS) Estimated Program Cost: $140.25M Type Program: PEO Program Authority: 10 U.S.C. 2304(c)(1), as implemented by FAR 6.302-1(a)(2)(iii) Type J&A: Class Contracting Officer/ Program Mgr: _________________________________________ __________ JASON CADEK ASC/PKESN Date Signed DSN: 986-7499, COM: (937) 656-7499 Local Legal Reviewer: _________________________________________ __________ GREGORY A. BAXLEY AFMCLO/JAN Date Signed DSN: 674-5552, COM: (937) 904-5552 Chief of the Contracting Office: _________________________________________ __________ DEBORAH B. SNAVELY ASC/PKE Date Signed DSN: 986-7333, COM: (937) 656-7333 Competition Advocate:_________________________________________ __________ HEIDI H. BULLOCK , COL, USAF ASC/PK Date Signed DSN: 785-3741, COM: (937) 255-3741 Senior Center Contracting Official: _________________________________________ __________ PATSY J. REEVES, SES ASC/PK Date Signed DSN: 785-3741, COM: (937) 255-3741 Program Executive Officer (PEO): _________________________________________ __________ THOMAS J. OWEN, LT GEN USAF ASC/CC Date Signed DSN: 785-5714, COM: (937) 255-5714 Deputy Assistant Secretary (Contracting): ________________________________________ __________ ROGER S. CORRELL SAF/AQC Date Signed DSN: 425-7010, COM: (703) 588-7010 Senior Procurement Executive: ________________________________________ __________ DAVID M. VAN BUREN SAF/AQ Date Signed ACTING ASSISTANT SECRETARY OF THE AIR FORCE (ACQUISITION) DSN: 223-9373, COM: (703) 693-9373 JUSTIFICATION AND APPROVAL (J&A) FOR OTHER THAN FULL AND OPEN COMPETITION I. CONTRACTING ACTIVITY a. Contracting Activity: Aeronautical Systems Center, Enterprise Acquisition Contracting Division (ASC/PKE) 2275 D Street Wright-Patterson AFB, OH 45433-7228 POC: Jason Cadek (937) 656-7499 E-Mail: Jason.Cadek@wpafb.af.mil b. Program Activity: All Air Force (AF) Commands are directed to manage their individual Contracting Engineering and Technical Services (CETS) requirements under AFI 21-110, Engineering and Technical Services Management and Control guidelines. II. NATURE AND/OR DESCRIPTION OF THE ACTION BEING PROCESSED a. CETS is the medium through which AF units use contractor personnel to provide on-site proficiency training, technical advice and technical assistance when organic skills are not available. The CETS may be acquired to support Air Force Security Assistance Center (AFSAC), the Army, the Navy, the Air National Guard (ANG) and possibly the Coast Guard for various weapon systems/subsystems/equipment located at operational AF, ANG, Army, Navy and Coast Guard installations. b. This Class J&A covers contractual actions for CETS to be awarded for 01 January 2011-31 December 2015. The total estimated number of contracts to be covered for the 5-year period of performance (01 January 2011-31 December 2015) is 10, for an estimated amount of $140.25M. This estimate is based on each Commands' projected CETS requirements, based on historical data, for the 5-year period covered by this Class J&A. Contracts will be awarded and task orders issued only after corresponding requirements have been validated by HQ USAF/ILMM and Commands have issued purchase request packages to ASC/PKESN. The exact number of contracts/task orders and estimated amounts cannot be precisely determined as Commands are continually eliminating and adding CETS representatives, at their respective bases, each year as requirements materialize. c. The CETS support weapon systems such as F-22 A/C, F-16 A/C, F-15 A/C, KC-135 A/C and A-10 A/C, which is in direct support for the aircrafts in the AFPEO/AC Portfolio. All AF activities that have CETS requirements must submit, on an annual basis, their HAF-ILM (A) 7150 (or its equivalent) to HQ USAF/ILM. This report includes precise narrative justifications for each CETS requirement including a list of the prime contractors. In accordance with AFI 21-110, Engineering and Technical Services, HQ USAF/ILMM reviews and validates these requirements on an annual basis. HQ USAF/ILMM maintains these reports. d. Contracts will generally be awarded during the September-December timeframe prior to the start of each year of performance. The contracts are based on the calendar year with a period of performance beginning 01 January and ending 31 December. All CETS contracts are service contracts, which are requirement contracts, with task orders issued against them. The funding is obligated to each task order issued against the basic contract on a yearly basis. Any CETS contracts that contain AFMC requirements will have a separate Requirements Approval Document (RAD) per contract covering the entire period of performance. All non-Air Force Materiel Command (AFMC) requirements will provide the appropriate Advisory and Assistance Services (A&AS) documents and Determination/Decision Document (DDD). The CETS contracts/task orders utilize fixed price man-month or man-day contracts with cost reimbursement Contract Line Item Number (CLIN) for personnel support expenditures such as official travel and in some instances, relocation. All CETS contracts are awarded in accordance with AFI 21-110. e. CETS is not a typical program managed by ASC. The CETS program is unique because it does not have any Program Managers, Financial Managers, Logisticians or Engineers involved within the CETS contracting organization. Those functions are performed within the requiring activities, not within the CETS Contracting Office. III. DESCRIPTION OF SUPPLIES/SERVICES REQUIRED TO MEET THE AGENCY'S NEEDS a. The AF acquires CETS for specialized on-site technical nonpersonal services that are essential in accomplishing the assigned mission of the equipment and/or weapon systems. The CETS contracts provide a method by which the contractor can provide new/updated information to the using command on new and/or complex equipment and weapon systems in the AF inventory. The CETS contracts also encompass on-the-job training of AF maintenance personnel by employees of the original equipment manufacturers. The CETS representative's main duties consist of the following: - Give on-site technical advice and hands-on training on all aspects of equipment maintenance and operations including modifications and retrofits; - Advise and train on special tools, handling equipment, test equipment and other related items; - Comply with and emphasize safety precautions and comply with Voluntary Protection Program requirements on applicable bases; - Provide maintenance and operational information from the manufacturer; - Assist in mishap investigations and failure data reporting; - Perform direct maintenance only under unusual or emergency circumstances. b. Air Force Engineering and Technical Services (AFETS) are the primary source of Engineering and Technical Services (ETS) support in the AF. AFETS field engineers are used and retrained as necessary to meet technical needs. CETS is an important element in developing an organic AF capability (insourcing) for its systems. In accordance with AFI 21-110, CETS personnel may not be retained on contract beyond which time AFETS personnel have attained proficiency on assigned systems and can provide the technical assistance associated with CETS support. c. All of the CETS contractors are original equipment manufacturers (OEM)s. The OEMs have successfully provided engineering and technical support over the past 30 years. The CETS OEMs place highly trained personnel in the field to train AF maintenance teams. The AF personnel continually evaluate, through weapon system and team performance, the quality of service these CETS personnel provide. Since a majority of CETS contracts are follow-on, the technical capabilities of the CETS personnel have already been validated. d. The type of funding that the AF CETS program uses is 3400 appropriations or operations and maintenance funds (O&M). All other services/agencies will provide their appropriate O&M funding. For any CETS Foreign Military Sales (FMS), AFSAC will provide the appropriate funding and will be sole source designated by the Letter of Offer and Acceptance (LOA)/International Agreement Competitive Restrictions (IACR) for individual contracts instead of this Class J&A. IV. STATUTORY AUTHORITY PERMITTING OTHER THAN FULL AND OPEN COMPETITION The statutory authority which permits other than full and open competition for this class of contract actions is 10 U.S.C. 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(iii). In the case of each individual contract, there is only one responsible source and no other services will satisfy agency requirements. Under this Class J&A the requirements are deemed to be available only from the original source (OEM) for the continued provision of highly specialized services. 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. For each acquisition awarded under the authority of this J&A, the agencies' minimum needs can only be satisfied by unique services available from one source (the OEMs). The OEM contractors possess the necessary proprietary data required to provide on-site CETS technical training. The AF lacks the expert resources and data necessary to establish an organic capability for these services when weapon systems/equipment or modifications thereto are initially fielded. The services are contracted from the manufacturer of the equipment or weapon systems in accordance with the policies and procedures in AFI 21-110. Only OEM CETS supported contracts have the ability to reach any specific expert at any time. Therefore, this acquisition is for continued performance of a highly specialized service. b. The OEM contractors also provide critical, updated technical data to the CETS representatives in the field. The original technical data is acquired by the government during the initial acquisition of the system/subsystem. At times the technical data is ambiguous and the OEM provides the expertise for interpretation. Furthermore, the expertise of the OEM contractor's research, development, manufacturing and administrative teams, buoyed by the learning curve effect of the manufacturing redesigning, modification and refining process, is not available outside the original equipment manufacturers. Additionally, the OEM contractors are highly trained, possess many years of experience, as well as being certified by the OEM on the different types of equipment that they will be training the AF to use/maintain. c. Acquisition of engineering drawings from the prime contractor, OEM, is often lengthy and time consuming. Frequently, the OEM contractor can supply the drawings through their CETS representatives within hours, thus enhancing the operating Commands' ability to make a major decision that affects the safe operations of very expensive weapon systems during combat situations. There are times when the ALC will have to go to a manufacturer for drawing support because the center does not have the system knowledge to support a request. Having the CETS representative available eliminates this time consuming procedure and increases the operational readiness of warfighting systems. d. ASC/PKESN 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 AF's requirements. The OEMs are designated as sole source for CETS provided in support of AF major subdivisions such as AFMC, Air Force Special Operations Command (AFSOC), Air Force Reserve Command (AFRC), Air Education and Training Command (AETC), Air Mobility Command (AMC), Pacific Air Forces (PACAF), Air Combat Command (ACC), United States Air Forces in Europe (USAFE), Air Force Space Command (AFSPC) and the ANG. Due to the fact that technical data and expertise are not available except from the OEMs, award to any other source would result in unacceptable and unreliable training for our AF maintenance teams and a critical increase in weapon systems downtime. Based on the reasons stated previously, it is also likely that award to any other source would result in substantial duplication of cost as a result of required reverse engineering on the different weapon systems/equipment or modifications in order for any other source to provide the required training, which would take numerous years. The process of reverse engineering for each different weapon systems/equipment or modifications would be substantially expensive that it would duplicate previously incurred costs for developing, manufacturing and training individuals so that the company would be able to provide individuals to perform CETS duties. There is not any way to provide an estimate for the duplication cost for the different weapon systems/equipment or modifications for CETS, since the original cost for each of the individual programs are not known to ASC/PKESN. It would be too costly to request the OEMs to research and provide the total costs for each individual program from research and development through production. None of the excess cost for reverse engineering would likely be recovered through competition and would also result in unacceptable delays in fulfilling agency requirements due to the fact that the entire process would be too time consuming. e. Accordingly, OEMs are the only firms capable of providing the services described in Section III 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 A synopsis was published on 13 August 2009 in the FedBizOpps following coordination with the Small Business Office. No sources have formally responded. A prior synopsis, for the FY 08-FY 10 program, also did not produce any new sources. Individual contract synopses published over the past 6 years have not produced any new qualified sources beyond the OEMs. All CETS basic contracts, that meet the criteria set forth in FAR 5.3, will be synopsized in an individual Notice of Contract Action. VII. DETERMINATION BY THE CONTRACTING OFFICER THAT THE ANTICIPATED COST TO THE GOVERNMENT WILL BE FAIR AND REASONABLE Fair and reasonable price determination on individual contract actions will be made based upon the results from various tools such as audits, technical evaluations and historical information. The requiring agencies provide a DD255a with each contract requirement which contains an independent government estimate for the calendar year. All proposed program costs will be thoroughly analyzed for each contract action. Contractors will be required to submit cost or pricing data to support the government's evaluation of the proposed price (in accordance with TINA threshold). When an audit is required, the technical evaluations will be provided by the Defense Contract Management Agency (DCMA) and audit assistance from the Defense Contract Audit Agency (DCAA). When under the TINA threshold, analysis will be performed by contacting DCAA for recommended rates and factors and by comparison to other PKESN CETS contracts. These methods will provide the contracting officer with adequate knowledge to determine a fair and reasonable price. VIII. DESCRIPTION OF THE MARKET RESEARCH CONDUCTED AND THE RESULTS, OR A STATEMENT OF THE REASONS MARKET RESEARCH WAS NOT CONDUCTED As described previously in Section VI, 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 from interested parties. No inquiries were made regarding the synopsis. Furthermore, market research for CETS over the past 30 years has not generated any successful new sources other than the OEMs. IX. ANY OTHER FACTS SUPPORTING THE USE OF OTHER THAN FULL AND OPEN COMPETITION a. ASC/PKESN experience has been that the various commands that CETS supports have contracted for Interim Contract Support (ICS) CETS personnel to support the USAF because the new systems are so intensive with computer driven devices that hardware/software changes and technical data are late-to-need. The manufacturer normally has the task of maintaining the technical data/software baseline for the USAF. Until the total engineering support is transferred to the responsible Air Logistics Center (ALC), the manufacturer has the only master file of current technical data. b. There are many components and hardware support items that are coded weapon system peculiar. The manufacturer has the specification data to cross-reference these items and provide alternative part numbers and specification numbers that can be substituted for installation on a component. As the weapon system matures, the AF develops the cross-reference tables at the ALCs and provides adequate support. This support is critical until in-house capabilities are developed. c. Procurement of engineering drawings from the prime contractor (OEM) is often lengthy and time consuming. Frequently, the OEM contractor can supply the drawings through their CETS representatives within hours, thus enhancing the operating Commands' ability to make a major decision that affects the safe operations of very expensive weapon systems during combat situations. There are times when the ALC will have to go to a manufacturer for drawing support because the Center does not have the workforce to support a request. Having the CETS representative available eliminates this time consuming procedure and increases the operational rate of warfighting systems. d. The Commands' statements of work will define all requirements to deliver a full-up operational weapons system to a combat unit. Frequently during the process of production, modifications/changes are made that affect the end product causing a shortfall in technical data, software and hardware for subsystems when the initial system is fielded. The CETS representatives are often the only link between and operating unit and the company to solve the problem. e. The minimum needs of the government for data and data rights have been determined according to DFARS 227.71. No technical data will be purchased or generated by contracts awarded under the authority of this J&A. Only services and related travel support costs, as defined and approved under the procedures set forth in AFI 21-110, can be purchased under the authority of this J&A. 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 The expertise required to provide CETS on a specified piece of equipment or weapon system is not normally available from other than the prime manufacturer. As the equipment/weapon system remains in the AF inventory, the possibility of the AF having trained personnel experienced on the contractor's equipment increases. This organic capability will result in the contracted services being eliminated. Other than organic capability, obtaining open competition is not practical due to the constant changes in the equipment/weapon system and lack of updated technical data being readily available. XII. CONTRACTING OFFICER'S CERTIFICATION The contracting officer's signature on the coordination and approval document 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(a)(12)). XIII. TECHNICAL/REQUIREMENTS PERSONNEL'S CERTIFICATION As CETS support extends to multiple platforms and multiple users contracted through ASC/PKESN, per AFI 21-110, there is not a single POC for technical/requirements. Each using activity provides their requirements to ASC/PKESN through a DD255a per the AFI. As evidenced by his/her signature on the coordination and approval document, the Contracting Officer acting as the coordinator for all program managers has certified that any supporting data contained herein which is the using activities responsibility is both accurate and complete (FAR 6.303-2(b)).