InsideNGO Advocacy Update - June 2010

InsideNGO periodically provides an update on advocacy and policy issues to inform members on topics that affect their jobs.  The summary below identifies important issues that we will continue to monitor and pursue, as appropriate.  InsideNGO members will find the complete June 2010 update by logging into the Members Only Site, where you will find each topic treated in more depth with links to additional information.  Contact Alison smith for more information at ASmith@InsideNGO.org.

InsideNGO in Depth Report

USAID Procurement Reform – Significant Changes Anticipated

Administrator Shah is under significant pressure to “do business differently.”  Emphasis will be on:

  1. Greater reliance on host government systems and capacity to manage budgets and awards,
  2. Greater use of local NGOs and businesses,
  3. Reduce reliance on Indefinite Quantity Contracts and Leader With Associate Grants,
  4. Simplified regulations and processes,
  5. Focus on results, and
  6. Closer collaboration with other donors

InsideNGO has been directly involved in recommending reforms and will host USAID representatives to discuss the reforms at the Annual Conference.

Grants and Cooperative Agreements

Acquisition versus Assistance – Revised Guidelines

USAID released revised internal guidance on the appropriate selection of acquisition versus assistance instruments.  The intent of the guidelines is to provide a clearer basis for selection of instruments, emphasizing that under an assistance relationship, USAID “transfers” funds to an awardee to carry out a program in which the direct beneficiaries are individuals, organizations or institutions in the host country.  A contract “exchanges” agency funds for a contractor’s good or services.

Profit on Subcontracts under Grants/Cooperative Agreements – Additional Help?

USAID also provided supplemental guidance to their Agreement Officers to help them distinguish between a subcontract and a subgrant when the prime is a grant or cooperative agreement.  The guidance reaffirms the 22 CFR 226.81 policy that profit is not permitted on prime assistance agreements and subgrants, but clearly states that profit is permissible on subcontracts.  The real issue is the proper selection of these sub-tier instruments to avoid disallowance of profit and other costs on a subcontract that should have been a subgrant.

Transparency on Subcontracts and Subawards – Get Ready for this!

President Obama continues to push for greater transparency in requiring the input of information on all subcontracts and subawards into a Federal-wide website.  This will be a significant management burden.  Comments are invited in response to the Federal Register Notice by July 7th.

Any New Ideas?  USAID Soliciting Suggestions to Minimize Paperwork

USAID is soliciting suggestions through the Federal Register on ways to reduce the paperwork burden on contractors and grantees.  This appears to be a very broad request.  Comments are requested for InsideNGO’s response by July 26th.

USAID News

Cuba – and Beyond?

USAID is requiring their contractors and grantees to sign a modification that contains a hold harmless and indemnification clause.  Please inform InsideNGO if you are required to sign such a modification.  We are concerned that this approach will be used more broadly than the Cuba program.

USAID and Social Media – Keeping Pace

USAID has established a presence in Web 2.0 through LinkedIn, Youtube, Twitter and Facebook.

Update on PVS & SPOT

InsideNGO remains concerned about growing pressure from Congress for USAID to roll-out the Partner Vetting System (PVS) beyond the West Bank/Gaza program as well as a requirement to register contractor and grantee personnel in a Defense Department system (SPOT) beyond Iraq. 

Trend Spotting

  1. USAID has rolled-out new guidance on selection of appropriate instruments and profit on subawards, as described above, but has not coupled it with training.  Be prepared for further inconsistencies of interpretation.
  2. Informal policies continue as COs are required to place proof of DBAI coverage in their files before authorizing travel overseas.
  3. Senator Leahy recently characterized USAID as inaccessible, existing in an ivory tower. 
  4. There’s increased pressure for the release of a revised Food Aid Regulation (Reg. 11).  We anticipate basically the same standards, but more streamlined procedures.

Looking Forward

Tanzania Study – Important Lessons on How USAID can Support Capacity Building

USAID/Tanzania awarded InsideNGO a small grant to capture lessons learned from three prime recipients on how to support capacity building efforts with local entities.  Among the findings include:

  1. Manage cash flow interruptions with more timely information
  2. Define benchmarks leading to a more capable local NGO or District Office
  3. Invest in operational support to effectively manage risk
  4. Include capacity building considerations in best value award determinations
  5. Streamline and delegate administrative approvals
  6. Training is a continuous need, but it requires a training strategy and alternative models.

New Changes to USAID’s ADS

ADS 303 – Grants and Cooperative Agreements to Non-Governmental Organizations

Noting that the current administration has renewed emphasis on women and children, USAID personnel must now be sure to include gender considerations, when appropriate, in program descriptions, key personnel qualifications and monitoring & evaluation requirements.

USAID has also slightly revised the standard provision entitled, “Equal Protection of the Laws for Faith-Based and Community Organizations,” by incorporating 22CFR205 on “Participation by Religious Organizations in USAID Programs,” and dictating that recipients must not engage in inherently religious activities as part of the USAID funded program.

ADS 302 – USAID Direct Contracting

The changes to ADS 302 for contracts are similar to those made in ADS 303 for assistance in requiring gender considerations in the different contract performance components, such as the statement of work, project deliverables, etc.

InsideNGO members may obtain a copy of the full June 2010 Advocacy Update by logging onto the Members Only Site.