Halifax Class Combat Systems In Service Support

1. Introduction

RFP Solutions Inc. was engaged on May 11, 2016 as a Fairness Monitor (FM) to observe all phases of the competitive procurement processes for the Halifax Class Combat Systems (HCCS) In Service Support (ISS) requirement.

The procurement involved multiple stages. The Industry Engagement Phase included two of the stages. A Request for Information (RFI) included multiple industry days with associated one-on-one supplier consultations providing industry with the opportunity to share with Canada, information on the current marketplace and supplier capabilities, as well as feedback on the proposed procurement approach. The RFI was issued by Public Services and Procurement Canada (PSPC) on behalf of the Department of National Defence (DND) through Solicitation Number W8482-168150/B; it was issued on August 10, 2016 with a final closing date of June 28, 2019. An RFI (Solicitation Number W8482-168150/A), associated with this procurement had been posted to buyandsell.gc.ca on August 9, 2016, but was cancelled due to issues with the posting; no documents had been issued. Within the Industry Engagement Phase, an Invitation to Qualify (ITQ) was issued with the intent to identify a list of qualified suppliers for participation in additional one-on-one and working group sessions to refine the requirements and approach prior to issuing a Request for Proposal (RFP). PSPC issued the ITQ on behalf of DND through Solicitation Number W8482-168150/C on March 8, 2017. The ITQ was cancelled on April 24, 2017 prior to the intended closing date. The final procurement stage was an RFP issued by PSPC on behalf of DND through Solicitation Number W8482-168150/D; it was issued on July 9, 2019 with a final closing date of January 27, 2020.

RFP Solutions Inc. is an independent third party with respect to this activity.

We hereby submit this Final Report, covering the activities of the FM, commencing with review of the draft RFI, continuing through the industry engagement, ITQ and RFP processes, including the responses to enquiries from potential bidders and amendments, leading to the bid closing. This report also addresses the evaluation of the four bids received, leading to the identification of the successful Bidder.

It should be noted that the evaluation of the bids was delayed by the impacts of the COVID-19 pandemic. This also necessitated that the evaluation be carried out remotely via teleconference and Microsoft Teams. This had no effect on the rigour or fairness of the evaluation.

The report includes our attestation of assurance, a summary of the scope and objectives of our assignment, the methodologies applied and relevant observations from the activities undertaken.

2. Project requirement

The DND Halifax Class Frigate Modernization (HCM) Program includes the replacement of six systems, now referred to as the HCCS Equipment Group (EG). This EG was retrofitted through the HCM Frigate Life Extension Combat System Integration Design-and-Build contract starting in 2010.

The HCCS EG comprises the following systems from various original equipment manufacturers (OEM):

• 3D Radar System SMART-S
• 2D Radar System SG-180
• Navigation Radar NSC-26
• Fire Control System CEROS200
• Identification Friend or Foe System MK XIIA
• NS9003A-V2HC Electronic Support Measures
• Associated Test Equipment and Training Aids

Limited ISS is currently being provided through separate contracts with each OEM that may hold the intellectual property rights for their respective systems. These interim contracts are limited in that they are intended to provide only the minimum essential support services until a more comprehensive ISS contract can be established.

The contractor will be required to provide ISS on the HCCS EG systems installed in all 12 Halifax Class ships, Royal Canadian Navy Fleet Schools, Fleet Maintenance Facility Cape Scott, Fleet Maintenance Facility Cape Breton, and the Naval Electronic Systems Test Range Atlantic and Pacific. The Contractor must obtain and maintain for the duration of the contract all necessary rights, licenses and agreements to be able to perform the Work. Special tools and test equipment located at some of these sites will also require ISS.

The Contractor must achieve the Royal Canadian Navy’s HCCS readiness and sustainment objectives by performing all activities necessary for the provision of ISS associated with supporting the HCCS EG in accordance with the contract, including:

• ISS Management
• Technical Schedule Management
• In-Service support Activities, including: Planning ISS activities, Design Intent Management, Configuration Management, Technical Problem Management Support, Obsolescence Management, Technical Data Management, Facilities and Government Property Management, Engineering Support, Maintenance and Material Management
• Training Support
• Electronic Information Environment
• Performance Monitoring and Assessment

3. Attestation of assurance

The Fairness Monitor hereby provides the following unqualified assurance statement concerning the Halifax Class Combat Systems In-Service support Contract.

It is our professional opinion that the procurement process up to the conclusion of the bid evaluations for the Halifax Class Combat Systems In-Service Support contract we observed was carried out in a fair, open and transparent manner.

4. Methodology

In accordance with the terms of our engagement, we familiarized ourselves with the relevant documents, observed the activities leading up to and during the industry engagement process, observed the RFP solicitation activities and the post solicitation period, including the evaluation of bids, identified fairness-related matters to the Contracting Authority and ensured that responses and actions were reasonable and appropriate. The following summarizes the specific activities and observations of the FM.

5. Fairness monitor activities and observations

The FM activities during the industry engagement phase covered two procurement stages. An RFI (Solicitation Number W8482-168150/B) was issued on August 10, 2016 to establish formal communications with suppliers with respect to the planned procurement. The RFI closed on June 28, 2019. During the RFI posting period, an ITQ (Solicitation Number W8482-168150/C) was also issued on March 8, 2017 with the intention of generating a list of qualified suppliers that would be engaged to refine the project requirements and procurement approach. Based on supplier feedback, the ITQ was cancelled on April 24, 2017 without generating a list of qualified suppliers. With the cancellation of the ITQ, the RFI continued to be the procurement instrument to engage suppliers to refine the project requirements and procurement approach.

The RFI stage included multiple amendments, industry days, one-on-one supplier consultation sessions and requests for written feedback, before, during and after the ITQ was issued and cancelled.

The RFP (Solicitation Number W8482-168150/D) was issued on July 9, 2019 and closed on January 27, 2020. The RFP included an optional site visit and multiple amendments during the posting period.

The subsections below describe the FM activities in general order in which they occurred.

5.1 Development of request for information

RFP Solutions Inc. was engaged to begin FM activities beginning with the development of the RFI. A review of the draft and final RFI documentation was conducted. This included:

• Objectives of the RFI
• Administrative and Technical Information

The FM provided assurance as to the neutrality of the requirements, the objectivity of requirements and process and the clarity of the documentation to support understandability by interested suppliers.

Observations

In reviewing the draft RFI documentation, no fairness issues were identified by the FM.

5.2 Request for information posting prior to invitation to qualify issuance

The RFI was issued to potential suppliers via buyandsell.gc.ca on August 10, 2016 as solicitation number W8482-168150/B with a final closing date of June 28, 2019 at 2:00 pm Eastern Time.

Prior to the ITQ posting a total of 10 amendments, containing responses to 34 questions and eight changes to the proposed terms and conditions, were issued via buyandsell.gc.ca. One of the amendments included a draft of the ITQ seeking comments from industry. Each amendment was reviewed by the FM prior to release.

The FM provided assurance as to the neutrality of the requirements, the objectivity of requirements and process; and the clarity of the documentation to support understandability by interested suppliers.

The FM attended and observed an industry day on December 6, 2016; it was attended by representatives from 15 interested suppliers.

The FM also attended and observed, in person, one-on-one consultations with six interested suppliers. They were held between December 6 and 9, 2016.

Observations

In reviewing the draft ITQ, responses to questions and amendments to the solicitation and observing the Industry Day and one-on-one consultations, the FM did not observe any fairness issues.

5.3 Invitation to qualify posting

The ITQ was issued via buyandsell.gc.ca on March 8, 2017 as solicitation number W8482-168150/C with an original closing date of April 28, 2017 at 2:00 pm Eastern Time.

A total of five amendments, containing responses to eight questions and two changes to the terms and conditions, were issued via buyandsell.gc.ca. A sixth amendment was issued on April 24, 2017 to cancel the ITQ because industry feedback indicated that no single supplier would have met the ITQ requirements. The FM reviewed each of the amendments prior to release.

Observations

In reviewing the responses to questions and amendments to the solicitation, the FM did not observe any fairness issues.

5.4 Request for information posting during the invitation to qualify posting period

During the ITQ posting period, two amendments to the RFI were issued via buyandsell.gc.ca. One amendment contained responses to five questions raised by industry on the ITQ. The second amendment contained a change to the proposed terms and conditions of the RFI relating to the draft Industrial and Technological Benefits/Value Proposition (ITB/VP) and scoring methodology. The FM reviewed each of the amendments prior to release.

Observations

In reviewing the responses to questions and amendments to the solicitation, the FM did not observe any fairness issues.

5.5 Invitation to qualify cancellation

As noted above, the ITQ was cancelled on April 24, 2017, prior to the planned closing date of April 28, 2017 because industry feedback indicated that no single supplier would have met the ITQ requirements.

An amendment to the ITQ was issued on buyandsell.gc.ca on April 24, 2017 to cancel the ITQ. The FM reviewed the amendment prior to its release.

Observations

In reviewing the amendment to the solicitation, the FM did not observe any fairness issues.

5.6 Request for information posting after the invitation to qualify cancellation

After the ITQ was cancelled, the Contracting Authority continued to engage with industry via the RFI through the receipt and response to questions, with industry days and one-on-one meetings with suppliers and through written responses to requests for feedback.

During the subsequent period after the ITQ was cancelled, a total of 20 amendments to the RFI were issued via buyandsell.gc.ca. The amendments contained responses to 152 questions from industry and 22 changes to the proposed terms and conditions. The FM reviewed each of the amendments prior to release.

An industry working group session was convened on September 26, 2017 to discuss drafts of the Performance Work Statement, Data Item Descriptions and Performance Requirements Specification. The session was attended by representatives from 13 interested suppliers. The FM attended the session in person to observe the process.

A second industry working group session was held on October 12, 2017 which was attended by 12 suppliers. This session was followed by one-on-one meetings with nine suppliers held on October 12 and 16, 2017 to discuss the Bid Evaluation Plan, the ITB/VP and the draft Financial Bid Presentation Sheet. The FM attended each of the sessions in person to observe the proceedings.

A third industry working group session was convened in the morning on October 26, 2017 to discuss proposed contract terms and conditions and the basis of payment. The working group session was attended by 11 suppliers. The working group session was followed by one-on-one meetings with seven suppliers in the afternoon on October 26, 2017. The FM attended and observed the working group session and each of the one-on-one meetings in person.

During the period from October 29, 2018 to November 2, 2018, additional one-on-one meetings were held with 13 suppliers to allow them to discuss and raise questions on the draft RFP. The FM attended each of the one-on-one meetings in person.

On November 1, 2018, the Contracting Authority issued a draft of the ITB/VP package with request for written feedback from suppliers by November 9, 2018. All suppliers participating in the process provided feedback to the Contracting Authority in accordance with the instructions.

On May 16, 2019, the Contracting Authority issued an amendment to the RFI with a request for written feedback from suppliers on aspects of the draft RFP; the deadline for responses was May 21, 2019. All suppliers participating in the process provided feedback to the Contracting Authority in accordance with the instructions.

On June 11 and 12, 2019, a final series of one-on-one meetings with six suppliers was convened to discuss the financial bid scoring approach. The FM attended each of the one-on-one meetings in person. Following the sessions, the participants submitted their feedback in writing to the Contracting Authority.

Observations

In reviewing the responses to questions and amendments to the solicitation, observing the Industry Day and one-on-one consultations, and reviewing the receipt and handling of the written responses for requested feedback, the FM did not observe any fairness issues.

5.7 Request for information close

The RFI closed administratively on June 28, 2019 in anticipation of the RFP being issued.

Observations

In reviewing the RFI closing, the FM did not observe any fairness issues.

5.8 Request for proposal pre-issue stage

The FM conducted a review of the drafts and final RFP documentation. This included a review of the:

• General Information
• Bidder Instructions
• Bid Preparation Instructions
• Evaluation Procedures and Basis of Selection
• Certifications and Additional Information
• Security, Financial and Insurance Requirements
• Resulting Contract Clauses
• Related Annexes and Appendices

The FM provided assurance as to the neutrality of the requirements, the objectivity of evaluation criteria and process, and the clarity of the documentation to support understandability by bidders in preparing their bids, as well as to mitigate the potential for inconsistency or errors in the eventual application of evaluation criteria by the Evaluation Committee.

Observations

In reviewing the draft RFP documentation, the FM provided comments on the clarity of the documents. All comments were appropriately addressed by the Contracting Authority prior to the posting of the RFP. No fairness issues were observed.

5.9 Request for proposal posting

The RFP was issued to potential proponents via buyandsell.gc.ca on July 9, 2019. The final closing date was January 27, 2020 at 2:00 pm Eastern Standard Time.

A total of 189 questions were answered. Responses to the questions were provided to all potential proponents as amendments via buyandsell.gc.ca. Solicitation Amendment No 01 was raised to answer 70 previous questions pertaining to the second draft RFP; that draft was amended resulting in the final RFP that was issued to potential proponents on July 9, 2019 under Solicitation Number W8482-168150/D. A total of 24 amendments to the terms and conditions of the solicitation were issued in ten Solicitation Amendment documents; each of which was reviewed by the FM prior to being issued.

An optional site visit was held at the Fleet Maintenance Facility Cape Scott, Her Majesty's Canadian Dockyard in Halifax, Nova Scotia on July 24 – 25, 2019; representatives from seven potential bidders attended. The FM was present and observed the optional site visit.

Observations

The FM reviewed all questions and answers and amendments issued and observed the optional site visit. No fairness issues were observed.

5.10 Request for proposal close

The FM reviewed the way the proposal responses to the RFP were received and handled with the Contracting Authority.

Four bids were received and handled in accordance with PSPC’s bid receipt practices, the closing requirements and deadline stated in the RFP.

Observations

In reviewing the receipt and handling of the RFP responses, no fairness considerations were identified by the FM.

5.11 Evaluation instructions

Prior to bid evaluations, a detailed evaluation plan was prepared to provide instructions to the technical reviewers (all DND personnel). The FM reviewed the evaluation guidelines, including evaluator responsibilities, code of conduct, security, confidentiality and conflict of interest requirements, and evaluation methodology.

An evaluation kick-off meeting for all evaluators was held on February 10, 2020 to review the evaluation plan. The meeting was conducted via teleconference. The FM was present to observe the proceedings. Subsequently, there were three sessions were convened on February 24 – 25, 2020 with the evaluators to conduct “dry runs” on the rated criteria to support consistency across the various evaluation teams. The sessions were conducted in person. The FM was present to observe the first session that was attended by most of the evaluators. The other two sessions were for the few evaluators that could not attend the first session.

The evaluation of submissions was subject to a Phased Compliance process for the mandatory submission and technical requirements.

The FM provided assurance as to the impartiality of evaluation methodology.

Observations

In reviewing the evaluation plan and observing the information sessions, the FM did not observe any fairness concerns.

5.12 Mandatory review

On February 20, 2020, a review of mandatory submission and technical requirements was undertaken by the Contracting Authority and Evaluation Committee respectively of the four bids received. Compliance Assessment Reports (CAR) were issued to two bidders. After the remedy period was closed, the CAR responses of the noncompliant bidders were assessed by the Evaluation Committee which concluded its review on April 3, 2020. All four bidders were deemed compliant to the requirements as stated in the RFP, and therefore eligible to proceed to technical evaluation.

The FM reviewed the results of the Phased Compliance process to assess them against the requirements in the RFP.

Observations

In reviewing the assessment of bidders’ compliance with the mandatory submission and technical requirements, the FM did not observe any fairness issues.

5.13 Technical evaluation

The rated technical evaluation was conducted on the four bids that met all mandatory requirements.

The rated requirements were reviewed individually by each member of the Evaluation Committee. The evaluators subsequently met via teleconference for several sessions between April 9, 2020 and August 13, 2020 to conduct a consensus evaluation.

The evaluators unanimously agreed that all four bids met the overall minimum rated technical evaluation threshold to be deemed a responsive proposal and proceed to the financial evaluation.

The FM was present to observe all the consensus evaluation sessions and reviewed and verified all the results.

Observations

In observing the consensus evaluation and reviewing and verifying the results of the technical evaluation, the FM did not identify any fairness issues.

5.14 Industrial and technological benefits and value proposition evaluation

Prior to the ITB/VP evaluations, an evaluation plan was developed and provided to the Innovation, Science and Economic Development Canada evaluators along with detailed evaluation instructions; both were reviewed by the FM. The evaluation plan and the evaluation instructions were reviewed by the FM.

The ITB/VP evaluations were also subject to the Phased Compliance process. A CAR was issued in respect of one bid. After the remedy period closed, all four bids were deemed compliant with the ITB/VP requirements.

The ITB/VP evaluators first reviewed the mandatory and rated ITB/VP requirements independently. Consensus evaluation meetings were then conducted over the period from June 29, 2020 to July 31, 2020. The meetings were conducted via Microsoft Teams.

The FM was present to observe all the consensus meetings. The FM also reviewed and verified the results of the evaluation.

5.15 Price evaluation, verification, and bidder selection

In accordance with the RFP, the pricing envelope for the four responsive bids were opened and the Contracting Authority determined the financial bid score each bid. The FM reviewed the financial bids and financial bid scores with the Contracting Authority.

The selection of the successful Bidder was based on the responsive proposal with the highest Total Score (Total Score = (Technical Merit Score x 55%) + (Financial Bid Score x 30%) + (ITB/VP Score x 15%)).

The Contracting Authority verified the Total Score for all four bids and reviewed the results with the FM.

Observations

In reviewing the results of the price evaluation, verification and bidder selection, the FM did not observe any fairness concerns.

5.16 Communications and debriefing

This section will be completed as an Addendum to this report following completion of contract award, which is subject to confirmation of security and integrity provisions and, as requested, debriefing of Bidders.

6. Reference documents

The following documents related to Solicitation Numbers W8482-168150/B, W8482-168150/C and W8482-168150/D are available on buyandsell.gc.ca and/or through the project office.

7. Addendum to final report, December 17, 2020

Addendum to the Fairness Monitor Final Report dated September 4, 2020 pertaining to the competitive procurement process for the Halifax Class Combat Systems In Service Support contract, issued by Public Services and Procurement Canada (PSPC) as a result of Solicitation Number W8482-168150/D.

This Addendum to the Fairness Monitor Final Report covers the period following the conclusion of the evaluation phase up to contract award. Four bids were received by PSPC in response to the Request for Proposal (RFP). All four bids met the administrative and mandatory requirements of the RFP and the overall minimum rated technical evaluation threshold. All four bids were evaluated for a financial bid score and industrial and technological benefits and value proposition score. Before contract award the highest scoring bid was subject to confirmation of security and integrity provisions. As well, the award was subject to review by the Treasury Board Secretariat to confirm that the award was consistent with prior Treasury Board approval.

The successful bidder was notified via e-mail on October 23, 2020, with the actual contract award occurring on October 30, 2020. The unsuccessful bidders were notified of the RFP results on November 2. 2020. An award notice was posted on buyandsell.gc.ca on November 6, 2020.

As part of its notification process, PSPC provided all bidders with written feedback on their evaluation scores. The three unsuccessful bidders subsequently requested a breakdown of their financial bid scores. One unsuccessful bidder subsequently requested a debriefing. PSPC provided the bidder with a written summary of its proposal evaluation on December 1, 2020. The Fairness Monitor reviewed all feedback before it was sent to the bidders.

Attestation of assurance

It is our professional opinion that, the Halifax Class Combat Systems In Service Support contract Request for Proposal evaluation and contract award processes we observed, were carried out in a fair, open and transparent manner