7200AA24C00088_J A.pdf

JUSTIFICATION AND APPROVAL FOR EXPEDITED PROCEDURES PACKAGE

TO: Daniel Moore, Contracting Officer

CC: JustificationsandA@usaid.gov

FROM: Priya Cariappa, Assistant General Counsel, Asia, Europe, and Eurasia

DATE: August 22, 2024

SUBJECT: Justification for Other than Full and Open Competition Award of Outside Counsel under the Expedited Acquisition and Assistance Procedures (EPP) for Ukraine, Belarus, and Moldova, dated March 4, 2022

1. This document sets forth the facts and rationale justifying the use of other than full and open competition.

This document was prepared by the Office of General Counsel in tandem with the Office of Acquisition and Assistance Regional Management Team.

Approval is requested for the justification for use of other than full and open competition pursuant to the authorities under the Expedited Acquisition and Assistance Procedures (EPP) for Ukraine, Belarus, and Moldova, dated March 4, 2022 (EPP extension approved on December 4, 2023, extending the EPP to March 6, 2025). Your approval of this J&A constitutes the justification for other than full and open competition as required by Tab 1 (D&F for the Authorization of Less than Full and Open Competitive Procedures in the Modification or Award of Contracts) of the EPP.

2. The nature and/or description of the action being approved:

This is a request to approve a limited competition award to the law firm Arnold and Porter Kaye Scholer LLP (“Arnold and Porter”) for $250,000. Under this action the law firm will provide assistance to the USAID Office of General Counsel (GC) to execute a Sovereign Loan Guarantee (SLG) under the Fiscal Year 2024 State, Foreign, Operations, and Related Programs Appropriations Act, Section 7030(b) for Ukraine. Arnold and Porter will assist the GC reviewing the associated legal instruments to ensure they are compliant with all applicable laws and provide other relevant advice. The nature of the position requires that the contractor be highly knowledgeable in the Ukraine local development context, international and regional development principles and approaches.

Redacted

3. Description of the supplies or services required, including an estimated value:

The law firm will review and provide draft language as appropriate for several financial documents required to execute the SLG. The estimated value for this work is $250,000.

Working in collaboration with attorneys and staff in the Office of the General Counsel, the Contractor will perform the following activities:

a. Negotiation: Provide advice to USAID as USAID negotiates elements of the loan, including covenants, default scenarios, redress, and other key terms consistent with policy.

b. Legal Due Diligence and Document Drafting:

i. Conduct minimal due diligence, if needed.

ii. Review, and provide draft language as appropriate, the MOUs and other international agreements regarding the loan and repayment.

This includes review of the governance structure(s) and repayment terms established and the repayment assurances provided.

iii. Review and provide draft language, as appropriate, the guarantee/security agreement provided by USAID and other related documentation.

c. Draft loan documentation clearly aligns with USG policy and security objectives, particularly in terms of drafting representations and warranties, covenants, and events of default to address, for example, agreed disbursement periods or conditionality, whether in terms of use of proceeds, required economic, environmental or social reforms, or other conditions.

d. Regularly advise on legal issues related to sovereign immunity and the jurisdiction of the United States courts, as it relates to non-US parties (both private and sovereign).

e. Set up uniform forms and provide training, if applicable, for sovereign loan guarantees.

4. Statutory authority permitting other than full and open competition:

The statutory authority permitting other than full and open competition is cited within the Agency for International Development Acquisition Regulation (AIDAR) exception at AIDAR 706.302-70(b)(3)(ii) and 40 U.S.C. §113. The Action Memorandum entitled Expedited Procedures Package (EPP) Ukraine, Belarus, and Moldova, initially approved March 4, 2022, and extended to March 6th, 2025, explicitly addresses expeditious contracting for needed services to urgently needed to provide support to the USAID/Ukraine and Belarus and USAID/Moldova staff and programs. The approved Action Memorandum includes the approved

Determination & Findings authorizing the use of other than full and open competition in the award or modification of contracts. A copy of the EPP is attached.

5. A discussion of the proposed contractor’s unique qualifications or the nature of the acquisition that requires use of the authority cited.

Programmatic and technical bases

USAID’s issuance of SLGs are rare, highly scrutinized and high risk development interventions. Congress, through the Fiscal Year 2024 State, Foreign Operations, and Related Programs Appropriations Act, Section 7030(b), provided USAID with such extraordinary authority and appropriation for USAID to use in Ukraine.

Relatedly, there have been various efforts to ensure that Russia pays for the damage it has caused Ukraine. On April 24, 2024, Congress passed the Rebuilding Economic Prosperity and Opportunity for Ukrainians Act (REPO) authorizing the President to confiscate Russian sovereign assets within the United States’ jurisdiction. In addition, on June 14, 2024, the G7 committed to provide “Extraordinary Revenue Acceleration loans for Ukraine” by the end of the year.

Led by the NSC, the interagency seeks to use windfall proceeds from such seized assets to repay a sovereign loan of unprecedented value ($20 billion to $50 billion).

They can only do so using USAID’s sovereign loan guarantee authority.

According to the NSC and Treasury, this timeline requires loan documents to be drafted by August 2024, for which it is critical that USAID/GC have a law firm in place to assist in protecting the agency, since the entirety of this plan relies on USAID’s authority.

USAID has not administered a sovereign loan guarantee since the transfer of Development Credit Authority (DCA) staff to the Development Finance Corporation (DFC) following the passage of the BUILD Act of 2018, and outside counsel will be critical to fill some of the gaps in expertise. While there are many lawyers within GC who have transactions experience, the nature and size of this complicated loan structure - coupled with its reliance on the Federal Financing Bank to issue the loan, and on international sovereigns to ensure repayment -require specialized legal transactions expertise.

6. A description of efforts made to insure that offers are solicited from as many potential sources as possible.

USAID Office of General Counsel issued a Request for Information (RFI) on May 23, 2024, to conduct market research on the Governmentwide point of entry in accordance with FAR 5.003. Six law firms responded to the RFI allowing GC to obtain information pertaining to the contractor’s interest, capacity and capabilities, and additional perspectives on the scope of legal services relative to sovereign loan guarantees.

GC reached out to all six law firms to gain more insight to their relevant background, expertise, and capabilities. Five responded to a request for further information. On August 14th, 2024, USAID sent a sole source Request for Proposal to the law firm White and Case. On August 15th, 2024, White and Case notified USAID of their inability to provide a proposal due to conflicts of interest in the Ukraine. In light of the White and Cases' conflict of interest, GC decided to issue an RFP pursuant to the authority other than full and open competition. under the EPP. The RFP was issued to two law firms in an effort to minimize potential barriers and prevent negative consequences to the program's objectives. The RFP was sent to Arnold and Porter and Hunton Andrews Kurth on August 16th, 2024.

The price Arnold and Porter proposes ($250,000) for the engagement is the lowest among 2 offers received.

7. A determination by the Contracting Officer that the anticipated cost to the Government will be fair and reasonable.

This is a Firm Fixed Price contract due to limited funding. Arnold and Porter's proposal is within the independent government estimate and their rates were found to be fair and reasonable in accordance with their expertise and services requested.

8. A description of the market research conducted (see FAR Part 10) and the results or a statement of the reason(s) market research was not conducted.

Please refer to item 6 for additional information.

9. Other facts supporting the use of other than full and open competition.

Given the ongoing uncertainty caused by the war, expeditiously providing assistance in a responsive manner takes priority over other options that would delay such assistance, especially where delay or inflexibility could compromise USAID's ability to provide necessary support. The timeframe required by fully competitive award procedures is inconsistent with USAID’s ability to continuously achieve U.S. foreign policy assistance objectives for Ukraine, Belarus, and Moldova. Utilizing AIDAR 706.302-70(b)(30(ii) provides the availability and use of expedited procurement procedures that would significantly abbreviate the procurement timeline and facilitate USAID’s provision of urgently needed supplies and services.

USAID would like to contract with Arnold and Porter. Arnold and Porter has an office located in Brussels and has a former European Union Commissioner on staff. As a result, the law firm has the expertise and resources to assist USAID navigate through the EU regulatory process necessary in order to assure repayment of the United States Government’s loan.

Arnold and Porter has also successfully worked with USAID on sovereign loan guarantees in the past, giving the law firm a unique perspective of understanding USAID’s legal authorities and processes. Additionally, the price Arnold and Porter proposes ($250,000) for the engagement is the lowest among 2 offers received. The combination of the number and level of personnel assigned to this contract, expertise, and price makes Arnold and Porter's proposal the best value for the money.

10. Sources, if any, that expressed, in writing, an interest in the acquisition.

See item 6. Advance notice of the proposed contract action is not required, and no other sources were identified.

11. The actions the Agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required:

The Agency currently faces an urgent need to select a law firm so that they can advise GC on draft loan agreements during the month of August. Driven by the crisis, as described in the EPP, GC requires the ability to make this award without the additional burden of conducting a full and open competition. If this sovereign loan guarantee is successful, it is highly likely that the agency will look to other sovereign loan guarantee opportunities, and under less urgent circumstances, at which time GC can return to full and open competition.

12. Technical or Requirements Personnel Certification:

In accordance with FAR 6.303, I hereby certify that the technical statements included above, and which form a basis for the justification are complement and accurate in accordance with EPP entitled Ukraine, Belarus, and Moldova, dated March 4, 2022 (attached).

Leigha Gordillo 8/22/2024 Leigha Gordillo Date

GC/DDE

13. General Counsel Clearance:

Sara Falk 8/22/2024 Sara Falk Date

GC A&A

14. Contracting Officer Approval:

_____________________________________ _8/22/204________________ Daniel Moore Date Contracting Officer

Redacted redacted

CLEARANCE PAGE

Drafter: Leigha Gordillo, GC/DDE Bureau and Mission Level Clearances Clearance Status Date GC/AE&E: Priya Cariappa Clear 8/22/24