Revised_Solicitation_72011418R00006.pdf

SOL-72011418R00006

TABLE OF CONTENT

SECTION B - SUPPLIES OR SERVICES/PRICES

B.1 PURPOSE

B.2 CONTRACT TYPE

B.3 ESTIMATED COST, FIXED FEE, AND OBLIGATED AMOUNT

B.4 BUDGET

P.5 PAYMENT OF FIXED FEE

B.6 INDIRECT COSTS

B.7 PAYMENT OF FIXED FEE

B.9 MULTI-YEAR CONTRACT AND CANCELLATION CEILING

SECTION C - STATEMENT OF WORK

SECTION D - PACKAGING AND MARKING

D.1 AIDAR 752.7009 MARKING (JAN 1993)

D.2 MARKING AND BRANDING STRATEGY

D.3 BRANDING STRATEGY AND MARKING PLAN

D.4 BRANDING STRATEGY

D.5 BRANDING IMPLEMENTATION PLAN (BIP) AND MARKING PLAN (MP)

SECTION E - INSPECTION AND ACCEPTANCE

E.1 NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

E.2 INSPECTION AND ACCEPTANCE

E.3 CONTRACTOR PERFORMANCE EVALUATION

SECTION F - DELIVERIES OR PERFORMANCE

F.1 NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

F.2 PERIOD OF PERFORMANCE

F.3 PLACE OF PERFORMANCE

F.4 AUTHORIZED WORK WEEK

F.5 AIDAR 752.242-70 PERIODIC PROGRESS REPORTS (OCT 2007)

F.6 REPORTS AND DELIVERABLES OR OUTPUTS

SECTION G – CONTRACT ADMINISTRATION DATA

G.1 CONTRACTING OFFICER'S AUTHORITY

G.3 CONTRACTING OFFICER’S REPRESENTATIVE (COR)

G.4 ACCEPTANCE AND APPROVAL

G.6 AIDAR 752.7003 DOCUMENTATION FOR PAYMENT (NOV 1998)

G.6 INVOICES

G.8 PAYING OFFICE

G.7 ACCOUNTING AND APPROPRIATION DATA

SECTION H - SPECIAL CONTRACT REQUIREMENTS

H.1 NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

H.3 AIDAR 752.7004 EMERGENCY LOCATOR INFORMATION (JUL 1997)

H.4 AIDAR 752.7005 SUBMISSION REQUIREMENTS FOR DEVELOPMENT EXPERIENCE

DOCUMENTS (SEP 2013)

H.5 INSURANCE AND SERVICES

H.6 AIDAR 752.228-70 MEDICAL EVACUATION (MEDEVAC) SERVICES (JULY 2007)

H.7 AUTHORIZED GEOGRAPHIC CODE

H.8 LANGUAGE REQUIREMENTS

H.9 AIDAR 752.7034 ACKNOWLEDGMENT AND DISCLAIMER. (DEC 1991)

H.10 EXECUTIVE ORDER ON TERRORISM FINANCING (FEB 2002)

H.11 AIDAR 752.7032 INTERNATIONAL TRAVEL APPROVAL AND NOTIFICATION

REQUIREMENTS (JAN 1990)

H.12 FOREIGN GOVERNMENT DELEGATIONS TO INTERNATIONAL

CONFERENCES (JUNE 2012)

H.13 ADS 302.3.5.5 REPORTING OF FOREIGN TAXES (JUL 2007)

H.14 USAID DISABILITY POLICY - ACQUISITION (DECEMBER 2004)

H.15 AIDAR 752.209-71 ORGANIZATIONAL CONFLICTS OF INTEREST DISCOVERED AFTER

AWARD (JUN 1993)

H.16 ENVIRONMENTAL COMPLIANCE

H.17 DISCLOSURE OF INFORMATION

H.18 BUSINESS CLASS TRAVEL

H.19 NEWS RELEASE

H.20 TITLE TO PROPERTY

H.21 NONDISCRIMINATION (JUNE 2012)

H.22 USAID IMPLEMENTING PARTNER NOTICES (IPN) PORTAL FOR ACQUISITION (JULY

2014)

H.23 SUBMISSIONOF DATASETS TO THE DEVELOPMENT DATALIBRARY (DDL) (OCT 2014)

H.24 PROHIBITION AGAINST DISCRIMINATION (OCT 2011)

H.24 PROHIBITION ON THE USE OF FEDERAL FUNDS TO PROMOTE, SUPPORT, OR

ADVOCATE THE LEGALIZATION OR PRACTICE OF PROSTITUTION– TIP ACQUISITION

(MAY 2007)

H.25 USAID IMPLEMENTATION OF SECTION 508 OF THE REHABILITATION ACT OF 1973

AND FEDERAL ACQUISITION CIRCULAR (FAC) 97-27 "ELECTRONIC AND INFORMATION

TECHNOLOGY ACCESSIBILITY

H.26 CONTRACTOR’S PERSONNEL INTEGRITY IN FOREIGN ASSISTANCE

H.27 52.203-99, PROHIBITION ON CONTRACTING WITH ENTITIES THAT REQUIRE CERTAIN

INTERNAL CONFIDENTIALITY AGREEMENTS (DEVIATION 2015-02)

H.27 LOGISTIC SUPPORT

H.28 CONSENT TO SUBCONTRACTS

H.29 CONFIDENTIALITY AND OWNERSHIP OF INTELLECTUAL PROPERTY

H.31 NONEXPENDABLE PROPERTY PURCHASES AND INFORMATION TECHNOLOGY

RESOURCES

H.32 FRAUD REPORTING

H.33 AIDAR 752.242-70, PERIODIC PROGRESS REPORTS (OCT 2007)

H.34 AIDAR 752.245-70 GOVERNMENT PROPERTY - USAID REPORTING REQUIREMENTS

(JUL 1997)

H.35 CONSIDERATIONS FOR GRANTS UNDER CONTRACT……………………………………..55

SECTION I- CONTRACT CLAUSES

I.1 NOTICE LISTING CONTRACT CLAUSES INCORPORATED BY REFERENCE

I.2 52.216-24 LIMITATION OF GOVERNMENT LIABILITY (APR 1984)

I.3 52.222-35 EQUAL OPPORTUNITY FOR VETERANS (OCT 2015)

I.4 52.222-36 EQUAL OPPORTUNITY FOR WORKERS WITH DISABILITIES (JUL 2014)

I.5 52.247-67 SUBMISSION OF TRANSPORTATION DOCUMENTS FOR AUDIT

(FEB 2006)

I.13 AIDAR 752.7101 VOLUNTARY POPULATION PLANNING ACTIVITIES (JUN 2008)

SECTION J - LIST OF ATTACHMENTS

SECTION K - REPRESENTATIONS, CERTIFICATIONS, AND OTHER STATEMENTS

OF BIDDERS

K.1 NOTICE LISTING SOLICITATION PROVISIONS INCORPORATED BY

REFERENCE

K.3 INSURANCE - IMMUNITY FROM TORT LIABILITY

K.4 AGREEMENT ON, OR EXCEPTIONS TO, TERMS AND CONDITIONS

K.5 52.209-5 CERTIFICATION REGARDING RESPONSIBILITY MATTERS (OCT 2015)

K.6 52.209-7 INFORMATION REGARDING RESPONSIBILITY MATTERS. (JUL 2013)

K.7 52.215-6 PLACE OF PERFORMANCE (OCT 1997)

K.8 52.222-21 PROHIBITION OF SEGREGATED FACILITIES (APR 2015)

K.9 52.222-22 PREVIOUS CONTRACTS AND COMPLIANCE REPORTS (FEB 1999)

K.10 52.225-20 PROHIBITION ON CONDUCTING RESTRICTED BUSINESS OPERATIONS IN

SUDAN—CERTIFICATION (AUG 2009)

K.11 52.227-15 REPRESENTATION OF LIMITED RIGHTS DATA AND RESTRICTED

COMPUTER SOFTWARE (DEC 2007)

K.12 52.230-1 COST ACCOUNTING STANDARDS NOTICES AND CERTIFICATION

K.13 52.230-7 PROPOSAL DISCLOSURE—COST ACCOUNTING PRACTICE CHANGES (APR

2005)

K.14 AUTHORIZED NEGOTIATORS

K.15 SIGNATURE

SECTION L - INSTRUCTIONS, CONDITIONS, AND NOTICES TO BIDDERS

L.1 FAR 52.252-1 SOLICITATION PROVISIONS INCORPORATED BY REFERENCE

(FEB 1998)

L.2 52.216-1 TYPE OF CONTRACT (APR 1984)

L.3 52.233-2 SERVICE OF PROTEST (SEP 2006)

L.4 GENERAL INSTRUCTIONS TO OFFERORS

L.6 INSTRUCTIONS FOR PREPARATION OF TECHNICAL PROPOSAL

L.7 INSTRUCTIONS FOR PREPARATION AND SUBMISSION OF THE COST/BUSINESS

PROPOSAL

L.8 INSTRUCTIONS FOR THE PREPARATION OF BRANDING AND MARKING PLANS

SECTION M - EVALUATION FACTORS FOR AWARD

M.2 TECHNICAL EVALUATION CRITERIA

M.3 COST/BUSSINESS EVALUATION

M.4 DETERMINATION OF COMPETITIVE RANGE

M.5 SOURCE SELECTION

SECTION B - SUPPLIES OR SERVICES/PRICES

B.1 PURPOSE

The purpose of the USAID Agriculture Program, implemented by this contract, is to provide technical assistance services that result in accelerated growth of agricultural sub-sectors that show strong potential to create jobs and increase MSME revenues, including the production and processing of fruits, vegetables, herbs, and other high-value horticultural products. The program will achieve these goals by increasing productivity and productive capacity; building capacity to add value through processing, storage, and other techniques to meet international standards and certifications; strengthening linkages within agricultural value chains as well as to new markets; strengthening the capacity of cooperatives, extension and other service providers, associations, and other relevant organizations.

B.2 CONTRACT TYPE

This is a Cost-Plus-Fixed-Fee (CPFF) Completion type contract. For the consideration set forth below, the Contractor achieve the performance objectives and deliverables or outputs described in Section C, Statement of Work, and in accordance with the performance standards specified herein.

B.3 ESTIMATED COST, FIXED FEE, AND OBLIGATED AMOUNT

(a) For the five-year contract period, the estimated cost for the performance of the work required hereunder, exclusive of fixed fee, is _______ [ TBD ] . The fixed fee, is _______ [ TBD ] . The estimated cost plus fixed fee, if any, is _______ [ TBD ] .

(b) Within the estimated cost plus fixed fee specified in paragraph (a) above, the amount currently obligated and available for reimbursement of allowable costs incurred by the Contractor (and payment of fee) for performance hereunder is _______ [ TBD ] . The Contractor must not exceed the aforesaid obligated amount, unless authorized by the contracting officer pursuant to the clause of this contract entitled “Limitation of Funds (APR 1984)” FAR 52.232-22.

(c) Funds obligated hereunder are anticipated to be sufficient through _______ [ TBD ] .

B.4 BUDGET

The following itemized budget sets forth the estimates for reimbursement of dollar costs for line items of cost and the fixed fee.

COST CATEGORY AMOUNT IN USD

Total Direct Cost Subcontracts Grants Total Indirect Cost Fixed Fee

TOTAL COST PLUS FIXED FEE

P.5 PAYMENT OF FIXED FEE

$TBD is the maximum fixed fee to be paid in accordance with this Section B.4. Subject to FAR 52.216-8 “Fixed Fee” and the following, the Contractor will be paid the proportion of the fixed fee that corresponds to the proportion of allowable direct costs incurred by the Contractor during the period covered by the invoice. Notwithstanding the foregoing, the Contractor’s fixed fee is in consideration of the accomplishment of the deliverables or outputs described in Sections C, D, and F, as well as complying with all Contract requirements. If the Contracting Officer determines that this method results in paying a disproportionately higher ratio of fixed fee than the percentage of work that the Contractor has completed, then the Contracting Officer may suspend further payment of any fixed fee until the Contractor has made sufficient progress to justify further payment. Subject to the Contracting Officer’s discretion, if the Contractor subsequently completes the delayed work such that costs incurred are proportionate to work completed, the Contracting Officer may approve payment of the amount of the fee that was suspended.

B.6 INDIRECT COSTS

The contract clause entitled “Allowable Cost and Payment (JUN 2013)”, FAR 52.216-7, specifies that the indirect cost rates shall be established for each of the contractor’s accounting periods that apply to this contract. Pending establishment of revised provisional or final indirect cost rates, allowable indirect costs shall be reimbursed on the basis of the following negotiated provisional or predetermined rates and the appropriate bases:

Description Rate Base Type Period

TBD TBD% 1/ 1/ 1/

TBD TBD% 2/ 2/ 2/

1/ Base of Application: TBD Type of Rate: TBD Period: TBD

2/ Base of Application: TBD Type of Rate: TBD Period: TBD

B.7 ADVANCE UNDERSTANDING ON CEILING INDIRECT COST RATES AND FINAL

REIMBURSEMENT FOR INDIRECT COSTS

(a) The Contractor must make no change in its established method of classifying or allocating indirect costs without the prior written approval of the Contracting Officer.

(b) Reimbursement for indirect costs must be at the lower of the negotiated final provisional/pre- determined rates or the following ceiling rates:

Description 2018 2019 2020 2021 2022 [Rate 1 description to be inserted] % % % % %

(c) The Government will not be obligated to pay any additional amount should the final indirect cost rates exceed the negotiated ceiling rates. If the final indirect cost rates are less than the negotiated ceiling rates, the negotiated rates will be reduced to conform to the lower rates.

(d) This advance understanding must not change any monetary ceiling, cost limitation or on established in the contract.

B.8 PAYMENT OF FIXED FEE

a) The Government shall pay the Contractor for performing this contract the fixed fee specified in the Schedule.

b) In accordance with FAR 52.216-8 “Fixed Fee (JUN 2011),” USAID reserves the right to withhold and reserve not to exceed $100,000. The Contracting Officer shall release 75 percent of all fee withholds under this contract after receipt of an adequate certified final indirect cost rate proposal covering the year of physical completion of this contract, provided the Contractor has satisfied all other contract terms and conditions, including the submission of the final patent and royalty reports, and is not delinquent in submitting final vouchers on prior years’ settlements. The Contracting Officer may release up to 90 percent of the fee withholds under this contract based on the Contractor’s past performance related to the submission and settlement of final indirect cost rate proposals.

B.9 MULTI-YEAR CONTRACT AND CANCELLATION CEILING

This contract is considered non-severable, and is therefore a multi-year contract as defined in FAR

17.103. Therefore, this contract is subject to the requirements of FAR 17.106.

A. Performance under this contract during the second and subsequent program years is contingent upon the appropriation of funds. All program years except the first are subject to cancellation.

Cancellation shall occur by the dates specified below if the Contracting Officer:

1. Notifies the Contractor that funds are not available for contract performance for any subsequent program year; or

2. Fails to notify the Contractor that funds are available for performance of the succeeding program year.

B. Cancellation Ceiling:

This is a CPFF type contract where the Contractor is authorized to be reimbursed for all costs which are allowable in accordance with FAR 52.216-7, “Allowable Costs and Payment.” Therefore, the Contractor will not incur any costs which would have been amortized over the life of the contract should the contract be cancelled in accordance with FAR 52.217-2.

The Government's liability for cancellation charges shall not exceed $TBD. This amount will be reduced in accordance with FAR 17.106-1(c)(1) at the conclusion of each program year, as follows:

Program Year Cancelation Date Cancelation Ceiling Year 1: 2018/2019 N/A N/A Year 2: 2019/2020 September 30, 2019 $ Year 3: 2020/2021 September 30, 2020 $ Year 4: 2021/2022 September 30, 2021 $ Year 5: 2022/2023 September 30, 2022 $

END OF SECTION B

SECTION C - STATEMENT OF WORK

C.1 INTRODUCTION

The purpose of USAID’s Agriculture Program in Georgia is to accelerate growth of agricultural sub-sectors that show strong potential to create jobs, increase incomes, and increase micro, small, and medium enterprises (MSME) revenues.

C.2 BACKGROUND

After the collapse of the Soviet Union, Georgia experienced its own economic collapse, internal and regional conflict, and rampant corruption. Economic activity fell to less than 30% of what it had been during Soviet times. Its industrial base was dismantled and rural Georgia became a pre-modern economy dominated by self-subsistence smallholder agriculture. Without access to inputs like fertilizers and pesticides and with virtually no investment into the sector, agricultural yields declined drastically. Land under agricultural production fell by 45% between 1990 and 1995, at which point Georgia became a net importer of agricultural products for the first time in modern history. Gradual gains in agricultural production were made up until the early 2000s, when the agriculture sector’s priority fell relative to other sectors of the economy. By 2008, land under agricultural production had fallen back to a historic low, government budget allocations were amongst the lowest in the world, the agriculture extension system had been dismantled, and state-owned agriculture assets were auctioned off. In 2010, Georgia’s agriculture sector reached a historic low point: exacerbated by a Russian trade embargo on Georgia’s agricultural products, exports collapsed, yields dropped, and food prices climbed.

Since 2010, however, an increase in Government of Georgia (GOG) support to the agriculture sector and concerted support from the donor community have improved productivity, increased productive capacity, and led to reductions in rural poverty levels. GOG and donors have made significant investments in the following areas: strengthening agricultural data collection; increasing access to new markets through export promotion and a number of free trade agreements (FTA), including FTAs with Turkey, China, and entering the European Union’s (EU) Deep and Comprehensive Free Trade Area (DCFTA); improving access to high quality inputs; supporting the development of farmers’ organizations and associations;

supporting the establishment of processors and cooperatives; and increasing farmers’ access to public extension services. High-level GOG strategy documents and consultations with key GOG stakeholders including the Prime Minister’s Donor Coordination Unit, the Ministry of Agriculture (MOA), the Ministry of Economy and Sustainable Development (MOESD), and GOG development agencies all indicate that agriculture is critical to sustainable and inclusive economic growth in Georgia. Specifically, the GOG supports the development of the agriculture sector through the MOA’s Agriculture Projects Management Agency (APMA). APMA administers multiple activities designed to increase agricultural productive capacity and productivity. APMA’s Plant the Future Project aims to support the production of perennial crops and local, high-quality planting materials (seedlings). Through its Preferential Agro Credit Project, Co-financing for Agro Processing and Storage Project, and Produce in Georgia, APMA provides access to subsidized credit and cost-share grants for primary producers, processors, and storage facilities. APMA’s Agroinsurance Project provides access to subsidized insurance for primary producers against the risk of hail, flood, storm, and autumn frost.

C.2.a Challenges faced by Georgia’s agriculture sector

Despite these gains, Georgian agriculture has yet to fulfill its potential to create jobs and increase incomes in rural areas. Rural poverty is still high and most rural employment is subsistence agricultural activity that masks unemployment. While evidence suggests that a number of agricultural products show strong potential for import substitution and value addition, Georgia’s fragmented and inefficient production structure, which is dominated by smallholder farmers who lack the ability to produce sufficient quality and quantities, means that consolidators and processors struggle to source locally from primary producers and instead rely on imports for raw materials. A related factor that affects backward linkages to primary producers is the limited capacity of cooperatives and associations to aggregate smallholder farmers’ production for joint marketing purposes. An additional constraint that contributes to poor supply chain integration and weak backward linkages to primary producers is a lack of wholesale market consolidation centers that would otherwise serve as aggregators of primary produce that processors could access for a reliable supply of inputs. Furthermore, Georgia suffers from a major shortage of post-harvest handling facilities, including those that store, pack, grade, and sort. These important value chain actors serve as both aggregators of primary production and opportunities for value addition before export or processing.

Georgia’s agricultural producers and processors also lack the skills necessary to adopt best production practices, improved and new technologies, and effective post-harvest handling techniques. This lack of knowledge and skills results in low levels of productivity and potential harm to human health and the environment. Furthermore, it is vital that farmers have knowledge of and means to deal with pests and diseases, which have the potential to wipe out entire crops if not handled correctly before and during the growing period and also at the post-harvest stage. An additional and significant challenge that Georgia’s agricultural producers will face in the next several years is meeting DCFTA-related standards and certifications. More than a typical goods and services FTA, the DCFTA aims to gradually integrate Georgia’s economy with the European economy by approximating Georgian legislation and institutional governance to that of the EU in various economic- and trade-related areas over the course of 10-12 years.

While the DCFTA will give Georgia’s producers preferential access to the EU market, it will also place international quality standards and requirements on Georgia’s producers, even for domestic marketing purposes. However, most of Georgia’s producers and processors lack the capacity to meet these standards using current production techniques, which means that few are able to take advantage of export opportunities or even market to domestic sales outlets. An important facet of this challenge is Georgia’s farmers’ propensity to apply suboptimal amounts of chemical inputs, which often results in crop losses, lower outputs, and potentially harm to consumers and the environment. One driver of this lack of knowledge and skills at the farm level is that farmers simply lack the resources required to upgrade skills and adopt improved technologies. Another factor related to this challenge is the limited reach of extension services, both private and public, upon which farmers often rely to provide this critical knowledge. Private extension service providers, often input providers, deliver useful services but normally only to farmers who purchase inputs at a considerable scale, which leaves a large proportion of farmers without access to private extension. Public extension services endeavor to fill this void but limited state resources mean that, for the most part, public extension is insufficient to meet the needs of a majority of farmers. In addition, formal and informal mechanisms designed to coordinate efforts between public and private extension limit the potential synergies between service providers that could otherwise extend the reach of extension. The increasing challenges farmers are likely to face in the future due to (a) sanitary and phytosanitary requirements and food safety standards related to the DCFTA and (b) increasing exposure to diseases and pests like the brown marmorated stink bug, which began damaging Georgia’s hazelnuts, citrus, maize, and other crops in 2016 and will continue to damage crops into the foreseeable future, make improving extension and advisory services even more critical over the next 5-10 years.

Even if producers and processors succeed in overcoming the challenges described above, they will struggle to benefit if they are unable to reach final markets. Georgia’s producers and processors often lack knowledge of potential market opportunities, especially those beyond traditional, lower value markets. This challenge is especially relevant for producers of fresh fruits, vegetables, and herbs, due to the high perishability and limited shelf-life of these products. Farmers need to know that they have an identifiable and reachable customer base to reduce the possibility of wastage, currently a major problem for Georgia’s fruit and vegetable producers. Another challenge facing agricultural producers is that post-harvest selling and distribution remains relatively primitive, with farmers having to rely on middle men to buy their produce; related to this challenge is the lack of cooperatives’ and associations’ capacity to coordinate joint marketing efforts among primary producers. In addition, small farmers are in no position to reach export markets without functional cooperatives and associations to aggregate and coordinate produce and assist to identify export market opportunities.

C.2.b Potential areas for intervention

A sector and market assessment carried out by USAID in 2017 identified agricultural subsectors including the production and processing of fruits, vegetables, herbs, and other high-value horticulture products as having strong employment generation possibilities, strong potential to integrate MSMEs into subsector growth, strong potential for value addition, and relatively low levels of required investment to stimulate growth in these subsectors. Value chains in these sub-sectors, especially niche market products like off-season production of fruits and vegetables, the production of fruits and vegetables that show strong domestic demand but weak production, and products that grow well in Georgia and have niche export market opportunities, including organically-certified products, have the potential to compete in EU and Eastern European markets. In addition, many fruit, vegetable, and herb value chains have high potential for value addition through drying, processing, and/or packaging before sale to domestic or export markets.

C.2.c Past, current, and future support to Georgia’s agriculture sector Implementation of USAID’s Agriculture Program must build on and complement the achievements of past and concluding programs designed to support Georgian agriculture, including the following programs. USAID’s Economic Prosperity Initiative (EPI) Program’s (2010-14) agriculture-related activities, which focused on medium scale producers, processors, and service providers in hazelnuts, mandarins, and greenhouse and open-field vegetables, improved operations, quality standards, and market linkages that resulted in increased sales, import substitution, and exports. USAID’s New Economic Opportunities (NEO) Program (2010-15) supported rural economic development for vulnerable populations through value chain interventions in agriculture by introducing new technologies and improving access to input supplies for MSMEs engaged in fruit, vegetable, and hazelnut production, livestock, and beekeeping. USAID’s Restoring Efficiency to Agriculture Production (REAP) Program (2013-18) has supported farm service centers, post-harvest handlers, and processors to upgrade equipment and facilities, meet international standards and certifications, and expand market linkages, as well as mitigate damage caused by the brown marmorated stink bug, a pest that attacks hazelnuts and other fruits and vegetables in Georgia.

Implementation of USAID’s Agriculture Program must also build on and complement current and future programs designed to support Georgian agriculture, including the follow programs. The European Neighbourhood Programme for Agriculture and Rural Development (ENPARD) (2013-20) supports the MOA in policy making, monitoring and evaluation, and extension service provision, as well as capacity building and investment in agricultural cooperatives; the rural development component of ENPARD works in eight Georgian municipalities and this assistance is anticipated to be expanded over the next 2-3 years. USAID’s Georgia Hazelnut Improvement Project (G-HIP) (2015-20), a Global Development Alliance between USAID and AgriGeorgia/Ferrero, supports activities to develop the hazelnut sector in Georgia, primarily through assistance to hazelnut sector associations to increase the quality and quantity of Georgian hazelnut production, improve processing capabilities, and enable smallholder farmers to reach more lucrative markets. USAID’s Development Credit Authority (DCA) (2015-22), a loan portfolio guarantee, provides flexible credit tools to expand agriculture loan products and improve loan terms for MSME borrowers. USAID’s Zrda Activity (2016-21) works to improve the livelihoods and resiliency of rural households from marginalized communities in proximity to the administrative boundary lines and communities with ethnic minority populations by supporting agricultural value chains including honey and other bee products, high quality fruits, vegetables, and berries. The US Department of Agriculture’s Food For Progress Program in Georgia (planned, 2018-2023) will support the development of Georgia’s dairy and beef sectors by assisting cattle farmers, dairy processors, and slaughterhouses to upgrade facilities and processes to comply with new food safety regulations, promote the development of cold chain infrastructure, support the development of dairy and beef cooperatives, and build capacity of input and service providers.

C.2.d Lessons learned from past and current activities

Implementation of past and current activities have resulted in several key lessons learned that must be incorporated into the implementation of USAID’s Agriculture Program, some of which include the following. First, when private enterprises cost-share USAID's technical assistance and/or capital investment projects, they are more committed to applying management improvements within their companies, which results in increased probability of the donor-funded programs to meet their objectives.

Based on this experience, USAID will consider using cost-share approaches in future designs. Another lesson learned is that awarding investment grants early in the project cycle brings additional benefits by allowing enterprises more time to operate, thus, more opportunity for utilizing USAID’s technical assistance, creating jobs, innovating, and expanding markets. In addition, the implementation of past activities has demonstrated that targeting assistance to clusters or groups of enterprises within a smaller number of targeted particular value chains is more cost effective and has greater impact on the development of these value chains than providing assistance to a broader range of firms across numerous value chains.

Through the implementation of past activities, USAID has also learned that cooperating with the GOG in promoting exports yields significant benefits in terms of increased visibility, reduced costs, and overall impact. Activities that have placed increased emphasis on forging sustainable partnerships with GOG-funded agencies and programs as well as with private sector partners has increased development impact, while also leaving a legacy of effective institutions, business linkages, and enduring partnerships within the public and private sectors. Another key lesson learned during FY 2017 was the importance of being adaptive to unexpected shocks. The brown marmorated stink bug infestation is a poignant example of this. USAID’s current agricultural activities were not designed to deal with large-scale pest management emergencies. However, USAID worked with two of its key agricultural implementing partners to review and modify their work plans in order to divert USAID resources to addressing the brown marmorated stink bug. The ability to make the necessary changes to the current programming placed USAID as the leader in dealing with the brown marmorated stink bug in Georgia and garnered the trust and political support of the GOG. USAID is looking for ways to make future awards more adaptive in order to address unexpected shocks and/or a rapidly changing operating environment.

C.3 SCOPE OF WORK

The purpose of this contract is to provide technical assistance services that result in accelerated growth of agricultural sub-sectors that show strong potential to create jobs and increase MSME revenues, including the production and processing of fruits, vegetables, herbs, and other high-value horticultural products.

The program will achieve these goals by increasing productivity and productive capacity; building capacity to add value through processing, storage, and other techniques to meet international standards and certifications; strengthening linkages within agricultural value chains as well as to new markets;

strengthening the capacity of cooperatives, extension and other service providers, associations, and other relevant organizations.

To meet the goal and objectives of USAID’s Agriculture Program, the contractor and its interventions must be flexible and responsive to changing market conditions and other exogenous factors. In case of rapidly changing market conditions and new opportunities, the contractor may need to change sub-sector(s) in order to promote increased employment and economic competitiveness. In case of unexpected shocks that threaten investments in priority agricultural sub-sector(s), such as pests, natural disaster, or other threats, the contractor may need to adapt its interventions to respond to such shocks.

C.4 DETAILED WORK REQUIREMENTS

USAID’s Agriculture program will have two primary components. Under the first component, the program will provide cost-share grants to producers, processors, cooperatives, service/information/extension providers and associations that are designed to address identified gaps in values chains. Under the second component, the program will provide demand-driven technical assistance to grant beneficiaries and other enterprises in order to maximize the benefits of cost-share grants and address value chain gaps. To the extent possible, the grants and technical assistance will be delivered in ways that benefit groups or clusters of enterprises within targeted value chains.

C.4.a Component 1: Cost-share grants to MSMEs, cooperatives, service/information/extension providers and associations

Through this component, the contractor must design and implement a competitive cost-share grants program for MSMEs, including producers, processors, service providers, and cooperatives and associations, with detailed, transparent selection criteria. These cost-share grants, most of which will be in-kind, must be targeted to address identified gaps in value chains. Grants and related TA can be used to increase MSME productivity and productive capacity, improve MSMEs’ ability to meet international standards and certifications, build market linkages within value chains, and create linkages to new markets.

The purpose of this cost-share grants component is to facilitate investments in business expansions and subsector growth that would not have otherwise happened without the grant and related TA. The intended purpose of this component is not to use grants to displace investments that likely would have otherwise taken place without program support or to support firms that have received significant donor support in the past.

Potential grant recipients must include, but are not limited to, the following:

Primary agricultural producers and producer cooperatives: Grants and related TA support to primary agricultural producers and producer cooperatives must be used to introduce new technologies and/or management practices in ways that can facilitate expansion and demonstrate viability to broader stakeholders, including smallholder farmers. Examples include introduction of new fruit or vegetable varieties, promotion of modern irrigation schemes, and improved pest, disease, and unwanted vegetation management.

Service/information/extension providers and business/sector associations: Grants and related TA support to service/information/extension providers and business/sector associations must be used to assist service providers and associations to expand provision of extension services and information, training, advocacy, capacity building, and other support to their customers, members, and other sector stakeholders.

Examples include introduction of extension consultation packages, development and delivery of technical and business training, establishment of demonstration plots owned and operated by customer/member farmers, subsidized provision of soil testing services, developing and sharing knowledge and other critical information with producers, etc.

Storage, consolidation, processing, and packaging enterprises and cooperatives: Grants and related TA support to storage, consolidation, processing, and packaging enterprises and cooperatives must be used to purchase equipment and/or related services that enable the grantee or grantee members to improve productivity, productive capacity, the ability to meet international standards, and/or integrate additional smallholder farmers into the supply chain.

Potential grant recipients must:

1. Have the capacity, or the ability to gain the capacity with limited TA, to operate their business profitability;

2. Have the willingness and ability to co-finance investment;

3. Have identified sufficient demand for their goods and/or services among potential clientele and supply from potential suppliers;

4. Demonstrate that the benefits derived from the grant will have a positive impact on other actors in the value chain, for example, cooperative members, input suppliers and/or primary producers, and;

5. When applicable, commit to maintain demonstration plots and/or provide trainings to other enterprises in the value chain.

Those applicants meeting certain criteria, to be determined by the contractor, will be provided with TA to further develop their business and financial plans and market assessments, and selected applicants will receive grants and additional TA to implement their business plans.

The aggregate amount of grants allocated under this component must be $6 million. Grants must be allocated to at least 100 MSMEs, cooperatives, service/information/extension providers and/or associations.

Grants provided to MSMEs will not exceed 40% of the total new estimated cash investment required for a new business start-up or the expansion of an existing business. Loans may be used to meet matching requirements, however in-kind contributions will not be considered. The maximum grant size to each MSME will be $75,000.

Grants provided to cooperatives and associations will not exceed 70% of the total new estimated cash investment required to improve and/or expand operations. Loans and in-kind contributions may be used to meet matching requirements for cooperatives and associations. The maximum grant size to each cooperative will be $75,000.

The contractor must work with all grant recipients to develop a series of training opportunities for their suppliers and clients, as applicable. These trainings will be designed to strengthen both business and technical skills and modern production techniques.

Additionally, entities receiving grants must agree to employ at least one intern on at least a part-time basis.

Prior to issuing a grant, the contractor must assess and document harmful distortions to local markets or businesses that may result from providing a grant and technical assistance (TA) to a potential recipient.

Subsequent to issuing a grant, the contractor must monitor for harmful distortions to local markets or businesses resulting from providing a grant and technical assistance to the recipient. In the event harmful distortions are observed, the contractor must develop mitigating measures to offset market distortions.

Prior to issuing a grant, the USAID Contracting Officer’s Representative (COR) must provide approval.

C.4.b Component 2: Technical assistance to SMEs, cooperatives, service/information/extension providers and associations

The contractor must provide demand-driven technical assistance to cost-share grant beneficiaries as well as non-grant beneficiaries. This technical assistance will include both assistance directly provided by the contractor and technical assistance provided through sub-contractors. The contractor must monitor grant recipients’ progress and provide additional technical assistance as needed to ensure that the objectives of the grants are met. In addition, the contractor must design and deliver technical assistance to non-grant recipients in ways that support value chain gaps identified in the assessment outlined in Section F. For technical assistance recipients, the contractor must identify opportunities for cost-share contributions for beneficiaries whenever possible. When providing technical assistance, the contractor must take a systematic approach to supporting groups or clusters of firms within value chains in priority subsectors rather than supporting individual firms across a wide range of value chains. Furthermore, whenever possible, in delivering technical assistance the contractor must partner with GOG agencies to maximize the impact of the assistance.

In addition to supporting activities described under component 1, types of technical assistance to cost-share grant beneficiaries and non-beneficiaries may include, but are not limited to, the following:

1. Assist with developing and or updating business plans, financial plans, and/or market assessments;

2. Train producers and MSMEs on business management and operation practices and skills;

3. Train MSME on operation and maintenance of equipment and/or facilities;

4. Facilitate the development and capacity building of business/sector associations (e.g., working with grant recipients to form industry or sector specific associations);

5. Train service and information providers on topics such as teaching methods, farmer outreach models, and technical skills and knowledge;

6. Provide technical training to farmers on production, harvesting and post-harvest techniques and practices;

7. Assist with developing business relationships and addressing requirements of financial institutions to obtain capital for further growth or expansion;

8. Facilitate relationships between value-adding agribusinesses and smallholder/emerging commercial farmers;

9. Facilitate market access to new domestic buyers and international markets;

10. Support farming and business/sector associations and cooperatives to develop marketing and branding campaigns, and;

11. Facilitate linkages between and provide support to vocational education institutions, business service providers, and enterprises to improve training curricula and increase access to private sector-led skills development opportunities.

While USAID’s Agriculture Program is not a policy-focused program, the contractor must also, where appropriate, support dialog and collaboration between private and public extension providers, educational institutions, and cooperatives to coordinate efforts to increase reach and effectiveness of extension and as appropriate, support the MOA to improve policies, management, outreach, procedures of public extension system and related functions.

C.5 CONTRACT DELIVERABLES

USAID is committed to quantifiable results. Through the two contract components, this program must achieve the results listed in the table below. The detailed deliverables and deliverables schedule for this contract are as follows:

Table 1: Contract Deliverables

No.

Result

Contract Year Contract Total

1 2 3 4 5

1 New full-time equivalent jobs created by program beneficiaries

TBD TBD TBD TBD TBD 3000

2 Increase in sales by assisted enterprises, of which:

TBD TBD TBD TBD TBD $60

million

2.a Increase in sales to new domestic markets/buyers (subset of 2)

TBD TBD TBD TBD TBD $10

million

2.b Increase in sales to export markets/buyers (subset of 2)

TBD TBD TBD TBD TBD $20

million

3 Increase in purchases of locally produced raw materials by assisted MSMEs

TBD TBD TBD TBD TBD $10

million

4 Number of recipient organizations that receive cost-share grants

TBD TBD TBD TBD TBD 100

5 Number of recipient organizations that receive technical assistance

TBD TBD TBD TBD TBD 300

6 Number of beneficiaries that participate in technical and/or business trainings provided by assisted organizations

TBD TBD TBD TBD TBD 150,000

7 Dollar value of cost-share leveraged from recipient organizations

TBD TBD TBD TBD TBD $6 million

The contractor is responsible for providing the contract deliverable targets listed above which constitute satisfactory contract performance.

C.6 IMPLEMENTATION REQUIREMENTS

The contractor must integrate the following requirements into its implementation approach.

Donor and host country coordination. The contractor must coordinate and complement activities closely with government, private sector, USAID projects, and other donor-led initiatives designed to enhance the competitiveness of the agriculture sector. The contractor must also leverage gains that have been established through past and current activities, in particular, those programs and activities discussed in Section C. 2.

Private sector driven and owned. The contractor must empower private sector actors to lead initiatives rather than drive processes itself. In developing and delivering interventions, the contractor must, whenever possible, work through intermediary institutions and organizations like producer associations, industry organizations, and public sector bodies. When possible, the contractor must rely on market facilitation rather than direct provision of services; in other words, the contractor must identify and build the capacity of private sector service providers rather than provide the services itself.

Public-private partnerships. The contractor must identify opportunities for the use of public-private partnerships (PPP), Global Development Alliances, and other GOG or donor resources to leverage grant and technical assistance provided through the activity and establish such partnerships whenever possible.

Women's economic participation. USAID has identified that there are limited opportunities for women to participate in economic activities as a major development challenge for Georgia. The contractor must identify constraints to women's economic participation, especially regarding ownership and management, and design interventions to overcome these challenges. The contractor must also identify women entrepreneurs and women-focused business associations in priority sub-sectors and provide them with specialized technical assistance to overcome issues which could prevent women from participating or fully benefiting from other technical assistance programs. Throughout the course of implementation, the contractor must ensure equitable participation of women in training and capacity building activities, as well as collect and use sex-disaggregated data to monitor progress in addressing these challenges.

Flexibility in implementation. The contractor and its interventions must be flexible and responsive to changing market conditions. This is especially true regarding sub-sectors for which markets are dynamic or volatile; in case of rapidly changing market conditions and new opportunities, the contractor may need to change sub-sector(s) in order to promote increased employment and economic competitiveness. In addition, to most effectively meet the goals and objectives of USAID’s Agriculture Program, the contractor may also need to shift emphasis between and within components and may do so in consultation with and with approval from the COR.

Sustainability and resiliency. The contractor must provide technical assistance to firms and organizations in priority sub-sectors to make activity interventions and results achieved through these interventions sustainable beyond the life of the activity. The contractor must examine the incentives and motivations of key actors for sustaining interventions and incorporate these findings into intervention design. The contractor must also promote engagement and partnerships with financial institutions and other private and public sector actors that have interests in seeing activity interventions and results sustained into the future. In addition, the contractor must build the resilience of MSMEs to factors with the potential to threaten investments in priority agricultural subsectors. Examples of interventions that build resilience could include improving access to instruments that mitigate financial risks such as crop and weather insurance, diversification of market linkages that reduces reliance on traditional yet unpredictable markets such as Russia, and support to encourage the adoption of environmentally-sound techniques to manage pests and unwanted vegetation.

Public information and outreach. The contractor must communicate opportunities, efforts, and successes under USAID’s Agriculture Program to the public. Outreach efforts must be coordinated with, and should leverage, USAID public outreach programs.

C.7 KEY PERSONNEL

A. The two key personnel whom the Contractor shall furnish for the performance of this Contract are as follows:

Chief of Party Deputy Chief of Party

B. The personnel specified above are considered to be essential to the work being performed. Prior to replacing any of the specified individuals, the Contractor immediately notify both the Contracting Officer and the (COR reasonably in advance and shall must submit written justification (including proposed substitutions) in sufficient detail to permit evaluation of the impact on the program.

No replacement of personnel shall be made by the Contractor without the written consent of the Contracting Officer. The listing of key personnel may, with the consent of the contracting parties, be amended from time to time during the course of the contract to add, change, or delete personnel and positions, as appropriate.

Minimum Qualifications:

The Chief of Party must have 15 years of relevant experience, at least 5 of which was in a development context similar to Georgia’s, and proven exceptional record of leading international donor-supported programs of similar size and complexity.

The Deputy Chief of Party must have 12 years of relevant experience, Fluency in English and Georgian, and a record of successful performance in at least one contract technical area.

The personnel specified above are considered to be essential to the work being performed hereunder.

Prior to replacing any of the specified individuals, the contractor must notify both the CO and the COR reasonably in advance and submit written justification (including proposed substitutions) in sufficient detail to permit evaluation of the impact on the program. No replacement will be made by the Contractor without the written consent of the CO.

C.8 PERIOD OF PERFORMANCE

The estimated period of performance for this activity is 5 years from the award date.

C.9 SPECIAL CONSIDERATIONS

USAID’s Agriculture Program is funded using US Government’s Global Hunger and Food Security Initiative “Feed the Future” funding. The contractor must adhere to all applicable Feed the Future rules and regulations in the implementation of this program. One of these regulations is how MSMEs are categorized. According to the Feed the Future definition, the size of an enterprise is determined by the number of full-time equivalent (FTE) employees employed indicated in parentheses: micro (1-10); small (11-50); and medium (51-100). The contractor must use these definitions, as well as additional applicable definitions, when designing support to MSMEs and reporting results.

C.10 ENVIRONMENTAL COMPLIANCE

The contractor must consider the impact of activities on the environment and include environmental sustainability as a central consideration when designing and implementing activities under USAID’s

Agriculture Program. As mandated by US Government Federal Regulations (Title 22 of the Code of Federal Regulations Part 216) and USAID’s Automated Directives System (Parts 201.5.10g and 204), the contractor must identify the potential environmental impacts of activities funded by this contract prior to a final decision to proceed and adopt appropriate environmental safeguards for all activities.

USAID’s Initial Environmental Examination (IEE) (see attachments) for activities to be undertaken within this program found that risk of negative impacts to the environment posed by anticipated activities under this program is low (negative determination) but includes terms and conditions to which the contractor must adhere when designing and implementing activities.