Justification for Exceptoin to Fair Opportunity

Justification for Exception to Fair Opportunity Space Management Support Under the Authority of FAR 16.505(b)(2)(i)(C) 1. Background/Identification of Agency: The Defense Logistics Agency (DLA) awarded Contract SP0600-10-D-5014 task order 1001 to Northrop Grumman (NG) on March 3, 2010. These services were procured via Solicitation Number SP0600-09-R-0505-0003. This task order is for consulting services in support of space/seating management for Defense Logistics Agency (DLA) Energy organic employees as well as covering additional seating for contract support staff. The contract is firm fixed price. The award value was $265,526 for the base year and $265,526, the same price, for the single one-year option period. A six-month extension was executed on February 23, 2012 that extended the contract from March 3, 2012 to September 2, 2012. That extension was valued at $132,763. The logical follow-on will cover the period beginning September 3, 2012 through March 2, 2013. The initial contract was awarded under full and open competition procedures with evaluation factors of Technical Approach, Price, and Past Performance factors being considered in the award decision. NG's offer was determined technically acceptable and the proposed price was determined fair and reasonable prior to award of the current contract. The Government was in the process of re-competing these services to cover a base period of one year with two one-year option periods. However, it was determined that the Government would be better served by executing a logical follow-on for a period of six months to provide continuing contract coverage while the Contracting office works to acquire these services at the DLA Headquarters level, rather than the DLA Energy level. 2. Nature and Description of the Action being Approved: A Logical Follow-on contract to Contract SP0600-10-D-5014, task order 1001 for Space Management services to cover a six-month period is being sought. 3. Description of the Agency's Need: DLA Energy, Fort Belvoir, VA, has a need for specific expertise in space/seating management for the organization to cover a period of six months by which time these services will be acquired under a separate contract at the DLA Headquarters level. The services are required as there is a significant shortage of seating for its organic employees as well as additional seating for contract support staff. The DLA Energy workforce has doubled in size since moving to the McNamara Complex (HQ) in 1995, expanding from 450 employees to over 800 today and that number continues to expand. This does not include approximately 110 contract support and intern employees. This acquisition is intended to manage DLA Energy's space requirements and is needed in order to reduce the risk of mission failure due to seating demands. 4. Identification of the Exception to Fair Opportunity (FAR 16.505(b)(2)): In accordance with FAR 16.505(b)(2)(i)(C), the order must be issued on a sole-source basis in the interest of economy and efficiency because it is a logical follow-on to an order already issued. The original contract provided all 2010 Indefinite Delivery/Indefinite Quantity Consulting Services awardees a fair opportunity to be considered for the original order. This exception is appropriate as the contractor providing these services is performing at a satisfactory level and is able to continue providing these services without disruption for a six month period until an alternative means of obtaining these services is established. 5. Determination of Anticipated Price Reasonableness/Price-Cost Considerations: Northrop Grumman's negotiated price for the six month logical follow-on reflects a 3% reduction to the current price being paid for these services. The base and option prices for the current contract were determined fair and reasonable by the DLA Contracting Officer prior to award and equate to $265,526 or $132,763 for a six-month period, the Contract Specialist negotiated an additional discount of 3% for the logical follow-on contract. The Government Cost Estimate (GCE) for re-competing these services to cover a period of three years was $858,000 or $143,000 for a six-month period. In addition, this contract action represents a cost savings for these services over the next six months of 3% compared with the GCE. After execution, the new total contract value will be increased by a total of $128,780.11 from $663,815.00, for a new total contract value of $792,595.11. Price for the logical follow-on is determined fair and reasonable based on comparison to the current price and the GCE. 6. Other Facts Supporting the Justification - Market Research: Market research was conducted using GSA's Mission Oriented Business Integrated Services (MOBIS) Schedule, Schedule Number 874-1 for Consulting Services. Rates for the same or similar labor categories to those employed by Northrop Grumman to provide Space Management Support to DLA Energy appear on the Labor Price Comparison chart, below. When compared with GSA MOBIS Schedule 874-1 contractor pricing, NG's negotiated price for the labor category of Project Manager range between 22.13% and 32.33% lower than BAE Systems and BAH's GSA MOBIS Schedule prices for similar labor categories. NG's negotiated rate for the labor category Senior Analyst range between 8.85% and 12.71% lower than BAE Systems and BAH's GSA MOBIS Schedule prices. NG's negotiated rate for a Management Analyst/Management Consultant is between 9.44% and 55.50% less than BAE Systems and BAH's GSA MOBIS Schedule prices. NG's negotiated rate for this logical follow-on is less than other contractors' pricing for the same or similar types of services currently offered in the market place and is 3% less than the price currently being paid for the same services. As stipulated in DFARS PGI 216.505-70(2)(i), it is expected that award to any other source at this time would result in result in unnecessary duplication of costs that the Government is not expected to recover through competition and award of these services to any other source would cause unacceptable delays in fulfilling the Government's requirements. 7. Actions being taken to Overcome Barriers to Competition: This is a one-time action. The initial procurement was solicited under full and open competition procedures. It is in the Government's best interest to continue to obtain these same services through a six-month follow-on contract while DLA prepares to a longer-term contract that will cover DLA at the headquarters level. 8. Determination by Approving Official of Exception that Applies to this Order: It is determined that the circumstances specified in FAR 16.505(b)(2)(i)(C), apply to this order. I hereby certify that the information contained in this justification is accurate and complete to the best of my knowledge and belief. Janet OMeara, Contract Specialist /S/ 8/1/2012 Charles Tiggs, Contracting Officer /S/ 8/1/2012 Caroline Chien, Legal Counsel /S/ 8/1/2012