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Contracting Update

Sharon M. Pritchard SSC Pacific

2 February 2016

APPROVED FOR PUBLIC RELEASE

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Topics

▼ Centerwide Contracting Strategy ▼ Tripwires Revised SPAWARNOTE December 2015

▼ Multiple Award Contract (MAC) Task Order Forecasting ▼ Cyberspace Science, Research, Engineering and

Technology Integration MAC (Cyber follow-on)

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SSC Pacific Centerwide Contracting Strategy

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Purpose & Objective

▼ Contracting with industry enables SSC Pacific to: Surge the workforce with qualified technical people, when required Facilitate access to skill sets that are either non-existent or in short supply Promote efficiency when the use of contactor personnel is more cost

effective

▼ The Centerwide Contracting Strategy enables this by: Providing a framework to support cross-Center contract requirements

collaboration; ensure support for SSC Pacific core technical capabilities Duplication of requirements is minimized Promoting “Contract Visibility” of active IDIQ contracts awarded by or

available for SSC Pacific use

ALIGNMENT AVAILABILITY VISIBILITY

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FY12 CONTRACT SEGMENTATION IN KEY COMPENTENCY AREAS (FY12 MATCHED SERVICE SPEND: $870M)

FY12 Data Service

Contract Obligation

Share Range of

Top 5 Contracts

within Each Area

Each individual contract

within a MAC counts as

“ONE” contract

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%$870M

464 Contracts

$98M

70 Contracts

$101M

#1 Contract #2 Contract #3 Contract #4 Contract #5 Contract

Simplified Acquisitions

Other Contracts

25 Contracts

$157M

11 Contracts

$48M

76 Contracts

$116M

95 Contracts

$180M

76 Contracts

SSC Pacific’s Contracting Landscape Contracts Align to the Center’s Core Technical Capabilities

Installs, Logistics, Fleet Support

C4ISR, Networks, IO Systems S&T, Applied Science

4.1 4.2 5.3/5.4 5.5 5.6 7.0

Overall

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SSC Pacific “Contracts Pyramid”

Capitalizes on: Natural requirements

consolidation at “Competency/Technical

Capability Level”

Cross-Competency Support Contracts

Capability Focused Contracts

Specialty Contracts

ISR and ISO

Networks

Communication Systems

SSC Pacific Contract Pyramid of Success

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Centerwide Contracting Strategy Supporting Tools

▼ IDIQ Contract Ceiling Tracker Tool Track contract ceiling at the individual contract level, providing Centerwide “near

real time” visibility of contract capacity Facilitates the timely initiation of contract recompetes

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Centerwide Contracting Strategy Supporting Tools

▼ SSC Pacific Contracts Listing Provides real time data on IDIQ contracts Searchable by: Summary PWS/SOW Period of Performance Contract Value Top 6 Subcontractors Requiring Department POC Contracting Officer

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Centerwide Contract Strategy Supporting Process

1) Identify need for IDIQ contract (Requirements POC) 2) Brief Portfolio Board (Requirements POC, Contracts

Branch Head) 3) Advise of estimated ceiling needs (Requirements

Contributors) 4) Publish Centerwide Notification of Contract Award (2.0) 5) Conduct annual Centerwide IDIQ Contracts Review (2.0)

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Tripwires

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Updated SPAWARNOTE

▼ SPAWARNOTE 4200, Service Contracting Tripwires Issued 14 Dec 2015

▼ Contains changes in: Definition of Service Contract Bridge Contract Actions Labor Rates Early Exercise Option

V 2.1

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Service Contract Definition

▼ For the purposes of Tripwire review and reporting, services exclude: The Research and Development

Product Service Code (PSC) group with the exception of the AXX6 (RDT&E Management/Support) class

▼ For the purposes of Tripwire review and reporting, services exclude: The Research and Development

Product Service Code (PSC) group with the exception of the AXX6 (RDT&E Management/Support) class;

Off-the-shelf software including software licensing agreements and off-the-shelf software updates, Software Maintenance Services Plans and Hardware Maintenance Services Plans for PSCs (D319 & D320); and

Foreign military sales/services.

Before change in policy After change in policy

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Bridge Contracting Actions

▼ Applicability. The term ‘Bridge Contracting’ applies to service contracts over the Simplified Acquisition Threshold (SAT).

▼ Approval Thresholds:

▼ Applicability. The term ‘Bridge Contracting’ applies to service contracts over the Simplified Acquisition Threshold (SAT). This tripwire does not apply to Task Orders.

▼ Approval Thresholds: Bridge Value Approval Authority$650K or less SSC PAC 2.0Between $650K and $5M SPAWAR 2.0Greater than $5M HCA

Bridge Value Approval Authority$700K or less SSC PAC 2.0Between $700K and $5.5M SPAWAR 2.0Greater than $5.5M HCA

Before change in policy After change in policy

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Labor Rates

▼ Apply to cost-type, time and material (T&M), and labor-hour services contracts and task orders over the SAT

▼ Prior to award: Fully burdened labor rates that are in excess of $150.00/hour in any labor category

▼ Apply to level-of-effort (LOE) cost-type, time and material (T&M), labor-hour, fixed price LOE services contracts and task orders over the SAT

▼ Prior to award: Fully burdened labor rates that are in excess of $165.00/hour in any labor category

Before change in policy After change in policy

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Labor Rates

▼ After Award Labor Rates: Labor charge in any labor category in excess of $150.00/hour that was not originally reviewed at time of award

▼ After Award Labor Rates: Labor charge in any labor category in excess of $165.00/hour that was not originally reviewed at time of award

▼ Once the individual labor rate has been reported as a trip, the COR is not required to report the individual labor rate again unless the rate increases more than 10% of the original trip amount

Before change in policy After change in policy

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Labor Rates

▼ Negotiated Versus Actual Average Labor Rate Variance. The COR shall report any

resultant trip on a monthly basis The quarterly labor cost variance

will be based on an average of the 1 month prior to reporting

Trip occurs when the average actual invoiced labor rate collectively increases more than 15% over negotiated average

▼ Negotiated Versus Actual Average Labor Rate Variance. The COR shall report any

resultant trip on a quarterly basis The quarterly labor cost variance

will be based on an average of the 3 months prior to reporting

Trip occurs when the average actual invoiced labor rate collectively increases more than 15% over negotiated average

Before change in policy After change in policy

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Early Option Exercise

▼ Previously any option, or a portion thereof, that is exercised earlier than the time specified in the original contract or task order, will be documented and forwarded to SPAWAR 2.0/2.0A for review

▼ This is no longer a trip

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SSC Pacific MAC Task Order Forecasting

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MAC Task Order Forecasting

▼ Policy Provides MAC awardees early insight into future requirements Allows MAC awardees to assess future requirements Promotes potential for competition

▼ Procedures Minimum twice a year; October and April Use of common template Contracts populates template with active MACs Forward template to each department Contracts forwards forecast information to MAC awardees

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Cyberspace Science, Research, Engineering

and Technology Integration MAC (Cyber Follow-on)

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Acquisition Strategy - Basics

▼ Indefinite-Delivery, Indefinite-Quantity (IDIQ) ▼ Multiple Award Contract (MAC) ▼ Cost-Plus-Fixed-Fee (CPFF) pricing arrangement ▼ 5 years (3-year base ordering period and one 2-year option

ordering period) ▼ Best Value Tradeoff ▼ Unique Small Business Strategy ▼ NAICS 541330; Size Standard of $38.5 million

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Small Business Strategy - Background

▼ Evaluated RFI responses and found small businesses demonstrated capability in certain areas, but not full scope of requirement

▼ SSC Pacific wants and needs direct access to these unique small business capabilities in order to meet our mission

▼ Strategy based on desire to involve small businesses to maximum extent practicable and to meet our mission requirements

▼ Unrestricted SOW is full scope of our requirement ▼ Small Business SOW is a subset of full scope

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Small Business Strategy - Basics

▼ Small Business SOW is a duplicated portion of Unrestricted SOW, rather than a portion “broken out” or “removed”

▼ One RFP will be issued ▼ Unrestricted SOW will be competed using full and open

competition ▼ Small Business SOW will be competed exclusively among

Small Businesses Will result in two MACs, meaning two “pools” of awardees

▼ Task order requirements will be competed among Small Business MAC awardees if requirement within scope of Small Business SOW