72049220R00008 (CHANGE).pdf

Issuance Date: June 15, 2020 Deadline for Questions: June 29, 2020; 3:00PM

(Manila Time) Closing Date/Time of Offers: July 20, 2020; 3:00PM

(Manila Time)

Subject: Solicitation No. 72049220R00008 Request for Proposal (RFP) for the Cities for Enhanced Engagement and

Governance (CHANGE) Activity

To all prospective Offerors:

The United States Agency for International Development through its Mission in the Philippines (USAID Philippines) is soliciting proposals from qualified organizations interested in providing technical services for the activity entitled “Cities for Enhanced Engagement and Governance (CHANGE).” The applicable geographic code for this procurement is 937, and the North American Industry Classification System (NAICS) is 541990.

USAID anticipates awarding a Cost Plus Fixed Fee (CPFF) Completion Type contract as a result of this solicitation. The estimated period of performance is five (5) years. The estimated total cost plus fixed fee for the award is between a range of $10million to $15million. Offerors must propose realistic and reasonable costs for the work described in the Statement of Work. USAID Philippines encourages the most effective methodology for achieving the expected results.

This procurement will be conducted under a full-and-open competition procedure for which the Federal Acquisition Regulation (FAR) Part 15 procedures for contracting by negotiation will apply. USAID Philippines encourages the participation, to the maximum extent possible, of small business concerns, either as prime contractor or as a subcontractor. USAID Philippines also encourages proposals that include partnerships of teams - prime contractor or subcontractor

- with international or local partners.

Any questions and requests for clarification concerning this RFP must be sent electronically via email to manila-roaa-rfp@usaid.gov (copy furnish fcalixto@usaid.gov) with subject line “Questions on CHANGE RFP submitted by [name of organization]” by the deadline for questions indicated at the top of this page. All responses to questions will be provided via an Amendment to the RFP and will similarly be posted in https://beta.sam.gov/. Offerors are encouraged to check the betaSAM website periodically as acknowledgement of any such Amendments is required to accompany the Offeror’s proposal.

It remains the Offeror’s responsibility to ensure that it has downloaded and received the RFP in its entirety, including all subsequent Amendments, if any. USAID bears no responsibility for data errors resulting from download, transmission, and conversion processes. Furthermore, mailto:manila-roaa-rfp@usaid.gov mailto:fcalixto@usaid.gov https://beta.sam.gov/

72049220R00008 (CHANGE) 2

Offerors are advised to read the solicitation carefully. Block 12 of Standard Form (SF)-33 of this RFP requires offers remain valid for 180 calendar days from the closing date (on the top of this page).

Proposals received after the closing date and time will be processed as late and handled in accordance with FAR 15.208(b). Offerors are responsible for ensuring that proposals are received by USAID Philippines on or before the specified closing date and time.

Technical and Cost Proposals must be prepared separately and submitted in accordance with Section L of this RFP.

Offerors are also instructed to pay full attention to Section K (Representations, Certifications, and Other Statement of Offerors). Offerors must comply with FAR 52,204-7, the System for Award Management (SAM) website, and complete the annual representations and certifications electronically at https://sam.gov/SAM/, Issuance of this solicitation neither obligates USAID Philippines to award a contract nor does it commit to pay for any costs incurred by the Offeror in the preparation and submission of its technical/cost proposals. Award will be subject to fund availability following the proper completion of the required USAID Philippines internal processes and other internal USAID Philippines approvals.

Sincerely, (Sgd) Sandra Jansen Contracting Officer Regional Office of Acquisition and Assistance https://sam.gov/SAM/

72049220R00008

SOLICITATION, OFFER AND AWARD

4. TYPE OF SOLICITATION2. CONTRACT NUMBER 3. SOLICITATION NUMBER

7. ISSUED BY CODE 8. ADDRESS OFFER TO (If other than Item 7)

ORDER UNDER DPAS (15 CFR 700)

6. REQUISITION/PURCHASE NUMBER

NOTE: In sealed bid solicitations "offer" and "offeror" mean "bid" and "bidder".

NEGOTIATED (RFP)

SEALED BID (IFB)

5. DATE ISSUED

1. THIS CONTRACT IS A RATED RATING PAGE OF PAGES

3 134

C. E-MAIL ADDRESS

EXT.NUMBERAREA CODE

B. TELEPHONE (NO COLLECT CALLS)A. NAME

10. FOR

INFORMATION

CALL:

CAUTION: LATE Submissions, Modifications, and Withdrawals: See Section L, Provision No. 52.214-7 or 52.215-1. All offers are subject to all terms and conditions contained in this solicitation.

(Date)(Hour) local timeuntildepository located in copies for furnishing the supplies or services in the Schedule will be received at the place specified in Item 8, or if hand carried, in the

SOLICITATION

9. Sealed offers in original and

PART IV - REPRESENTATIONS AND INSTRUCTIONS

OTHER STATEMENTS OF OFFERORS

EVALUATION FACTORS FOR AWARD

INSTRS., CONDS., AND NOTICES TO OFFERORS

REPRESENTATIONS, CERTIFICATIONS AND

LIST OF ATTACHMENTS

CONTRACT CLAUSES

PART III - LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACH.

I

J

K

L

M SPECIAL CONTRACT REQUIREMENTS

CONTRACT ADMINISTRATION DATA

DELIVERIES OR PERFORMANCE

INSPECTION AND ACCEPTANCE

PACKAGING AND MARKING

DESCRIPTION/SPECS./WORK STATEMENT

SUPPLIES OR SERVICES AND PRICES/COSTS

SOLICITATION/CONTRACT FORM

PART II - CONTRACT CLAUSESPART I - THE SCHEDULE

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G

F

E

D

C

B

A

SEC. DESCRIPTION PAGE(S) (X) DESCRIPTION SEC. (X)

11. TABLE OF CONTENTS

18. OFFER DATE17. SIGNATURE

SUCH ADDRESS IN SCHEDULE.

IS DIFFERENT FROM ABOVE - ENTER

15C. CHECK IF REMITTANCE ADDRESS

EXT.NUMBERAREA CODE

15B. TELEPHONE NUMBER

(Type or print)AND

ADDRESS

OF

OFFEROR

CODE FACILITY

16. NAME AND TITLE OF PERSON AUTHORIZED TO SIGN OFFER15A. NAME

DATEAMENDMENT NO.DATEAMENDMENT NO.

and related documents numbered and dated):

amendments to the SOLICITATION for offerors

(The offeror acknowledges receipt of

14. ACKNOWLEDGEMENT OF AMENDMENTS

CALENDAR DAYS (%)30 CALENDAR DAYS (%)20 CALENDAR DAYS (%)10 CALENDAR DAYS (%)

(See Section I, Clause No. 52.232.8)

13. DISCOUNT FOR PROMPT PAYMENT

designated point(s), within the time specified in the schedule.

by the offeror) from the date for receipt of offers specified above, to furnish any or all items upon which prices are offered at the price set opposite each item, delivered at the

NOTE: Item 12 does not apply if the solicitation includes the provisions at 52.214-16, Minimum Bid Acceptance Period.

OFFER (Must be fully completed by offeror)

IMPORTANT - Award will be made on this Form, or on Standard Form 26, or by other authorized official written notice.

28. AWARD DATE

(Signature of Contracting Officer)

27. UNITED STATES OF AMERICA

25. PAYMENT WILL BE MADE BY

26. NAME OF CONTRACTING OFFICER (Type or print)

CODE 24. ADMINISTERED BY (If other than Item 7)

ITEM

(4 copies unless otherwise specified)

23. SUBMIT INVOICES TO ADDRESS SHOWN IN

41 U.S.C. 253 (c) ( 10 U.S.C. 2304 (c) (

22. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION:

21. ACCOUNTING AND APPROPRIATION20. AMOUNT19. ACCEPTED AS TO ITEMS NUMBERED

AWARD (To be completed by government)

CODE

REQ-492-20-000068

1400 U

Regional Office of Acquisition and Assistance (ROAA) manila-roaa-rfp@usaid.gov

X

X

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PAGE(S)

AUTHORIZED FOR LOCAL REPRODUCTION

Previous edition is unusable

STANDARD FORM 33 (Rev. 9-97)

Prescribed by GSA - FAR (48 CFR) 53.214(c)

3-3 8-9

10-26 27-30 31-31 32-44 45-49 50-73

74-82

83-83

84-101

102-124

125-134

12. In compliance with the above, the undersigned agrees, if this offer is accepted within _____180_________ calendar days (60 calendar days unless a different period is inserted

Regional Office of Acquisition and Assistance USAID Philippines

X

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72049220R00008 (CHANGE) 4

Table of Contents

PART I – THE SCHEDULE

SECTION B – SUPPLIES OR SERVICES AND PRICES/COSTS

B.1 PURPOSE

B.2 CONTRACT TYPE AND SERVICES

B.3 ESTIMATED COST, FIXED FEE AND OBLIGATED AMOUNT

B.4 PAYMENT OF FIXED FEE

B.5 INDIRECT COSTS

B.6 COST REIMBURSABLE

B.7 CANCELLATION PROCEDURES

SECTION C – DESCRIPTION/STATEMENT OF WORK

C.1 INTRODUCTION

C.2 PROBLEM ANALYSIS

C.3 LOCAL GOVERNANCE ENGAGEMENT OF USAID AND OTHER DONORS . 14

C.4 SCOPE OF WORK

C.5 GUIDANCE

SECTION D – PACKAGING AND MARKING

D.1 AIDAR 752.7009 MARKING (JAN 1993)

D.2 BRANDING STRATEGY

D.3 BRANDING STRATEGY, IMPLEMENTATION PLAN AND MARKING PLAN 28

D.4 SOCIAL MEDIA AND ONLINE OUTREACH

SECTION E – INSPECTION AND ACCEPTANCE

E.1 NOTICE LISTING FAR SOLICITATION PROVISION INCORPORATED BY

REFERENCE

E.2 INSPECTION AND ACCEPTANCE

SECTION F – DELIVERIES OR PERFORMANCE

F.1 NOTICE LISTING FAR SOLICITATION PROVISIONS INCORPORATED BY

REFERENCE

F.2 PERIOD OF PERFORMANCE

F.3 PLACE OF PERFORMANCE

F.4 KEY PERSONNEL

F.5 AUTHORIZED WORKDAY/WORK WEEK

F.6 PERFORMANCE STANDARDS

F.7 MANAGEMENT OF CONTRACT

F.8 REPORTS AND DELIVERABLES OR OUTPUTS

F.9 LANGUAGE OF REPORTS AND OTHER OUTPUTS

F.10 SUBMISSION REQUIREMENTS FOR DEVELOPMENT EXPERIENCE

CLEARINGHOUSE (SEP 2013)

72049220R00008 (CHANGE) 5

SECTION G – CONTRACT ADMINISTRATION DATA

G.1 AIDAR 752.7003 DOCUMENTATION FOR PAYMENT (NOV 1998)

G.2 CONTRACTING OFFICER’S AUTHORITY

G.3 ADMINISTRATIVE CONTRACTING OFFICE

G.4 CONTRACTING OFFICER’S REPRESENTATIVE (COR)

G.5 TECHNICAL DIRECTION/RELATIONSHIP WITH USAID

G.6 ACCEPTANCE AND APPROVAL

G.7 INVOICES

G.8 PAYING OFFICE

G.9 ACCOUNTING AND APPROPRIATION DATA

SECTION H – SPECIAL CONTRACT REQUIREMENTS

H.1 LANGUAGE REQUIREMENTS

H.2 GOVERNMENT FURNISHED FACILITIES OR PROPERTY

H.3 TITLE TO AND CARE OF PROPERTY

H.4 CONFIDENTIALITY AND OWNERSHIP OF INTELLECTUAL PROPERTY

H.5 DISCLOSURE INFORMATION

H.6 CONTRACTOR’S STAFF SUPPORT, AND ADMINISTRATIVE AND

LOGISTICS ARRANGEMENTS

H.7 AIDAR 752.7007 PERSONNEL COMPENSATION (JUL 2007)

H.8 ADDITIONAL REQUIREMENTS FOR PERSONNEL COMPENSATION

H.9 RESTRICTIONS AGAINST DISCLOSURE (MAY 2016)

H.10 AIDAR 752.222-70 USAID DISABILITY POLICY (DEC 2004)

H.11 DEFENSE BASE ACT (DBA) INSURANCE

H.12 CONTRACTOR’S USE OF PROJECT VEHICLES AND LIABILITY INSURANCE

REQUIREMENTS FOR PRIVATELY OWNED VEHICLES

H.13 INTERNATIONAL TRAVEL

H.14 AUTHORIZED GEOGRAPHIC CODE

H.15 SOURCE AND NATIONALITY REQUIREMENTS (FEB 2012)

H.16 CONSENT TO SUBCONTRACT

H.17 PRESS RELATIONS

H.18 FOREIGN GOVERNMENT DELEGATIONS TO INTERNATIONAL

CONFERENCES (JUN 2012)

H.19 EXECUTIVE ORDER 13224 – EXECUTIVE ORDER ON TERRORIST

FINANCING

H.20 ENVIRONMENTAL COMPLIANCE

H.21 AIDAR 752.229-71 REPORTING OF FOREIGN TAXES (JUL 2007)

H.22 AIDAR 752.222-71 NONDISCRIMINATION (JUN 2012)

H.23 AIDAR 752.7036 USAID IMPLEMENTING PARTNER NOTICE (IPN) PORTAL

FOR ACQUISITION (JUL 2014)

H.24 ADS 302.3.5.21 SUBMISSION OF DATASETS TO THE DEVELOPMENT DATA

LIBRARY (DDL) (OCT 2014)

H.25 HOST COUNTRY SALARY SUPPLEMENT (ADS 302.3.3 (d) (2) (viii) & (AIDAR

752.231-71 and AIDAR 731.205-71))

H.26 AIDAR 752.7004 EMERGENCY LOCATOR INFORMATION (JUL 1997)

72049220R00008 (CHANGE) 6

H.27 AIDAR 752.228-70 MEDICAL EVACUATION (MEDEVAC) SERVICES (JUL

2007)

H.28 HOMELAND SECURITY PRESIDENTIAL DIRECTIVE-12 (HSPD-12) (ADS

302.3.5.13)

H.29 STANDARDS OF CONDUCT – IMPROPER BUSINESS PRACTICES

H.30 GENDER CONSIDERATION

H.31 MANAGEMENT OF INFORMATION TECHNOLOGY RESOURCES

H.32 USAID IMPLEMENTATION OF SECTION 508 OF THE REHABILITATION

ACT OF 1973 AND FEDERAL ACQUISITION CIRCULAR (FAC) 97-27

“ELECTRONIC AND INFORMATION TECHNOLOGY ACCESSIBILITY”

H.33 VALUE ADDED TAX (VAT) AND CUSTOM DUTIES

H.34 VOLUNTARY POPULATION PLANNING ACTIVITIES (JUN 2008)

H.35 ELECTRONIC PAYMENT SYSTEM

H.36 GRANTS UNDER CONTACT

H.37 LIMITATION ON ACQUISITION OF INFORMATION TECHNOLOGY (APR

2018)

PART II – CONTRACT CLAUSES

SECTION I – CONTRACT CLAUSES

I.1 FAR 52.252-1 SOLICITATION PROVISIONS INCORPORATED BY

REFERENCE (FEB 1998)

I.2 FEDERAL ACQUISITION REGULATION (FAR TITLE 48 OF THE CODE OF

FEDERAL REGULATIONS CHAPTER 1) CLAUSES

I.3 USAID ACQUISITION REGULATION (AIDAR; 48 CFR CHAPTER 7) CLAUSES

PART III – LIST OF DOCUMENTS, EXHIBITS, AND OTHER ATTACHMENTS

SECTION J – LIST OF ATTACHMENTS

PART IV – REPRESENTATIONS AND INSTRUCTIONS

SECTION K – REPRESENTATIONS, CERTIFICATIONS, AND OTHER STATEMENTS OF

OFFERORS OR RESPONDENTS

K.1 NOTICE LISTING FAR SOLICITATION PROVISION INCORPORATED BY

REFERENCE

K.2 FAR 52.204-8 ANNUAL REPRESENTATIONS AND CERTIFICATIONS (MAR

2020)

K.3 FAR 52.209-5 CERTIFICATION REGARDING RESPONSIBILITY MATTERS

(OCT 2015)

K.4 FAR 52.209-7 INFORMATION REGARDING RESPONSIBILITY MATTERS

(OCT 2018)

K.5 FAR 52.209-9 UPDATES OF PUBLICLY AVAILABLE INFORMATION

REGARDING RESPONSIBILITY MATTERS (OCT 2018)

72049220R00008 (CHANGE) 7

K.6 FAR 52.209-11 REPRESENTATION BY CORPORATION REGARDING A

DELINQUENT TAX LIABILITY OR A FELONY CRIMINAL CONVICTION

(FEB 2016)

K.7 FAR 52.222-22 PREVIOUS CONTRACTS AND COMPLIANCE REPORTS (FEB

1999)

K.8 FAR 52.222.25 AFFIRMATIVE ACTION COMPLIANCE (APR 1984)

K.9 FAR 52.222.52 EXEMPTION FROM APPLICATION OF THE SERVICE

CONTRACT LABOR STANDARDS TO CONTRACTS FOR CERTAIN

SERVICES (MAY 2014)

K.10 FAR 52.222.56 CERTIFICATION REGARDING TRAFFICKING IN PERSONS

COMPLIANCE PLAN (MAR 2015)

K.11 FAR 52.230-1 COST ACCOUNTING STANDARDS NOTICES AND

CERTIFICATION (OCT 2015)

K.12 FAR 52.230-7 PROPOSAL DISCLOSURE-COST ACCOUNTING PRACTICE

CHANGES (APR 2005)

K.13 INSURANCE – IMMUNITY FROM TORT LIABILITY

K.14 AGREEMENT ON, OR EXCEPTIONS TO, TERMS AND CONDITIONS

K.15 AUTHORIZED NEGOTIATORS

K.16 SIGNATURE

SECTION L – INSTRUCTIONS, CONDITIONS, AND NOTICES TO OFFERORS OR

RESPONDENTS

L.1 NOTICE LISTING SOLICITATION PROVISIONS INCORPORATED BY

REFERENCE

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

L.3 GENERAL INSTRUCTIONS TO OFFERORS

L.4 PROPOSAL SUBMISSION

L.5 INSTRUCTIONS FOR THE PREPARATION OF THE STEP 1 - TECHNICAL

PROPOSAL

L.6 INSTRUCTIONS FOR THE PREPARATION OF THE STEP 2 - TECHNICAL

PROPOSAL

L.7 INSTRUCTIONS FOR THE PREPARATION OF THE COST PROPOSAL

L.8 DRAFT BRANDING IMPLEMENTATION PLAN AND MARKING PLAN

L.9 CO-DESIGN

SECTION M – EVALUATION FACTORS FOR AWARD

M.1 GENERAL

M.2 TECHNICAL EVALUATION FACTORS

M.3 COST/BUSINESS PROPOSAL EVALUATION

72049220R00008 (CHANGE) 8

PART I – THE SCHEDULE

SECTION B – SUPPLIES OR SERVICES AND PRICES/COSTS

B.1 PURPOSE

The purpose of this contract is to provide technical assistance services necessary for the successful implementation of the USAID Philippines Cities for Enhanced Engagement and Governance (CHANGE) Activity.

B.2 CONTRACT TYPE AND SERVICES

This is a FAR 16.306 Cost-Plus-Fixed-Fee (CPFF) completion type contract. The Contractor shall furnish all personnel, materials, equipment, supplies, facilities, services (except as expressly set forth in this contract as furnished by the Government) and perform all activities necessary for, or incidental to, the performance of work described in Section C.

B.3 ESTIMATED COST, FIXED FEE AND OBLIGATED AMOUNT

(a) The estimated cost plus fixed fee amount is $TBD at time of award.

(b) Within the estimated cost plus fixed fee amount in item (a) above, the contract is currently obligated and available for reimbursement of allowable costs incurred by the Contractor (and payment of fee, if any) for performance hereunder is $TBD at time of award. The Contractor shall not exceed the obligated amount unless authorized by the Contracting Officer pursuant to the clause of this contract entitled “Limitation of Funds”

(FAR 52.232‐ 22).

(c) Funds obligated are anticipated to be sufficient until [TBD at time of award].

(d) Any costs incurred that exceeded the obligated amount are considered unallowable.

B.4 PAYMENT OF FIXED FEE

Pursuant to FAR 16.306(d)(1), payment of fixed fee shall be based on completion of the deliverables described in Sections C and F of this contract and in accordance with the approved Fee Schedule below.

Performance Objective/Deliverable/Output

Due Date Percentage Fee Amount ($)

TBD TBD TBD TBD

TBD TBD TBD TBD

72049220R00008 (CHANGE) 9

Performance Objective/Deliverable/Output

Due Date Percentage Fee Amount ($)

TBD TBD TBD TBD

TBD TBD TBD TBD

B.5 INDIRECT COSTS

FAR 52.216-7 “Allowable Cost and Payment (Jun 2013)” specifies that the indirect cost rates shall be established for each of the Contractor’s accounting periods which 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 negotiated provisional or predetermined rates and their appropriate bases as contained in the Contractor's latest Negotiated Indirect Cost Rate Agreement (NICRA).

B.6 COST REIMBURSABLE

The U.S. dollar costs allowable will be limited to reasonable, allocable, and necessary costs determined in accordance with FAR 52.216-7, “Allowable Cost and Payment,” FAR 52.216-8, “Fixed Fee,” FAR 52.232-20, “Limitation of Cost,” and FAR 52-232-22, “Limitation of Funds,” if applicable, and AIDAR 752.7003, “Documentation for Payment.”

B.7 CANCELLATION PROCEDURES

Per FAR 17.106-1(c) Cancellation Procedures, all program years except the first are subject to cancellation. The cancellation ceiling shall be established below for Years 2 -5 of the contract.

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 is expected not to 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. Therefore, the cancellation cost for each cancellation date is [TBD – to be filled in at the time of award].

Cancellation Date

Total Cost Fixed Fee Total CPFF Cumulative

CPFF

Contract Year 2

Contract Year 3

Contract Year 4

Contract Year 5

[END OF SECTION B]

72049220R00008 (CHANGE) 10

SECTION C – DESCRIPTION/STATEMENT OF WORK

C.1 INTRODUCTION

The Cities for Enhanced Governance and Engagement (CHANGE) activity of USAID/Philippines is a flexible and adaptive two-phased implementing mechanism that will support the priority thrust of the Government of the Philippines to support people-centered, clean and efficient governance as articulated in the 2017-2022 Philippine Development Plan;1 and Intermediate Result 1.2 Public Transparency and Accountability Improved and Intermediate Results 1.4 More Responsive Local Governance of Development Objective 1: Democratic Governance Strengthened of the Mission’s Country Development Cooperation Strategy.2 This activity is also consistent with and contributes to the United States Government’s Indo-Pacific Vision.3 Good governance is a core pillar of the U.S. vision for a free and open Indo-Pacific, including a commitment to work with Indo-Pacific nations to promote sound, just, and responsive governance. More transparent, accountable and responsive local governance will be achieved by 1) strengthening the enabling environment for decentralization; 2) Enhancing service delivery capacity, legitimacy, transparency and accountability of participating local governments; and 3) empowering citizens by increasing their participation in and oversight of local governance processes in ways that government both approves and supports.

CHANGE is based on the premise that collective actions and stronger partnerships between local governments and the communities that make up their constituencies will bring democratic governance closer to the people. Localities where the people have opportunities to participate in governance, to express grievances peacefully, to congregate freely and demand accountability from their government, empower citizens and produce leaders who govern in accordance with the people’s interests. Along with other interventions and adequate resources, the promotion of participatory local governance will help nurture more responsive, transparent, accountable local governments that are able to deliver basic services to the people and will build resilience to malign foreign influence that threatens the nation’s sovereignty.

This will be implemented in two phases. Phase 1 will be implemented in the eight (8) cities currently covered by the Strengthening Urban Resilience for Growth with Equity (SURGE), USAID’s flagship project under its Cities Development Initiative, and complement current activities to promote the development of conditions for broad-based, inclusive and resilient economic growth. The eight (8) cities are: Batangas, Legaspi, Puerto Princesa, Iloilo, Tagbilaran, Cagayan de Oro, Zamboanga and General Santos. Phase 2 will expand to additional cities that USAID will identify in conjunction with current efforts to develop a successor to its Cities Development Initiative and other programmatic considerations.

1 http://pdp.neda.gov.ph/wp-content/uploads/2017/01/PDP-2017-2022-07-20-2017.pdf 2 https://www.usaid.gov/philippines/cdcs 3 https://www.state.gov/wp-content/uploads/2019/11/Free-and-Open-Indo-Pacific-4Nov2019.pdf http://pdp.neda.gov.ph/wp-content/uploads/2017/01/PDP-2017-2022-07-20-2017.pdf https://www.usaid.gov/philippines/cdcs https://www.state.gov/wp-content/uploads/2019/11/Free-and-Open-Indo-Pacific-4Nov2019.pdf

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C.2 PROBLEM ANALYSIS

Consistent with the constitutional mandate to provide autonomy to local governments and empower the citizenry (see Articles II, X and XIII of the 1987 Philippine Constitution), the passage of Republic Act 7160, frequently referred to as the Local Government Code (LGC) of 1991, aimed to: 1) hasten the process of development by creating the enabling conditions for economic activity, enhancing resource management, reducing wastage, and improving the delivery of basic services to the people; and 2) broadened democratic space in the Philippines by strengthening the avenues for the practice of direct and representative democracy at local levels.

It provided the operational framework for the decentralization of fiscal, administrative and political authority to sub-national units and the institutionalization of citizen participation in local governance.

In lieu of centralized decision-making in Manila, the LGC delegated authorities, functions, resources, and regulatory responsibilities in important areas to local government units (LGUs).

LGUs were made responsible for land use planning and local service and enterprises; and managing the delivery of health, agricultural extension, social welfare, local public works, and environmental services. LGUs also assumed an important role in promoting economic development and maintaining peace and order in their jurisdictions. The underlying assumption is that LGUs are best able to determine and respond to local needs.

When the law was passed, more than 70,000 personnel working for national line agencies of the government of the Philippines were transferred to LGUs. In terms of fiscal autonomy, the law transferred 40 percent of internal revenue collections from the national government to LGUs, in addition to increasing the revenue-generation authorities of the latter. Currently, the internal revenue allotments (IRA) is distributed to 82 provinces (23% of IRA), 145 cities (23%), 1,478 municipalities (34%) and 41,902 barangays (20%) based on a formula that considers both population and land area. A recent decision by the Supreme Court of the Philippines (Mandanas versus Ochoa, July 2018) will have the effect of significantly expanding the revenue base from which the IRA to LGUs are computed.4

A fundamental attribute of decentralization as implemented in the Philippines--and the focus of this activity--is its direct contribution to democratic governance. Outside of elections, the LGC provides the most compelling framework for engaging citizens in governance, bringing government closer to the people, and making institutions more accountable and transparent.

The law provides avenues for the participation of CSOs to represent citizen interests as well as mechanisms for direct citizen engagement. The different sections of the law that mandate public participation in local governance5 are:

1. Partnerships between LGUs and civil society organizations (CSOs) to promote local autonomy and development (Sections 34-36 of the LGC);

2. Representation of CSOs in local special bodies:

4 http://www.chanrobles.com/cralaw/2018julydecisions.php?id=530 5 Click on the link for the full text of the Local Government Code of 1991, http://extwprlegs1.fao.org/docs/pdf/phi93246.pdf http://www.chanrobles.com/cralaw/2018julydecisions.php?id=530 http://extwprlegs1.fao.org/docs/pdf/phi93246.pdf http://extwprlegs1.fao.org/docs/pdf/phi93246.pdf http://extwprlegs1.fao.org/docs/pdf/phi93246.pdf

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- Local Development Councils (Sections 106-115)

- Local School Boards (Sections 98-101)

- Local Health Boards (Sections 102-105)

- Local Peace and Order Councils (Section 116)

- Prequalification Bids and Awards Committees (Section 37)

3. Sectoral representation including of women in local legislatures (Sections 446, 457, 467)

4. Youth representation (Sections 423-438)

5. Recall of elected officials (Sections 69-75)

6. Village assemblies to review performance and finances (Sections 397-398)

7. Citizen initiatives to propose, enact or amend ordinances (Sections 120-127)

8. Requirement for national agencies to conduct consultations prior to implementing projects (Sections 2c and 26-27)

By bringing government closer to citizens, decentralization allows people to participate more effectively in local affairs, including identification of community priorities. Local leaders can be held increasingly accountable for decisions that affect citizens’ lives thus reinforcing the people’s faith in the legitimacy of the political system.

Decentralization, however, can have unintended consequences. In spite of its tremendous potential to bring government closer to the people and in doing so increase participation, accountability, responsiveness, and local development; weak implementation frequently characterized by the inadequate devolution of political, fiscal and administrative authorities, and capacity deficits of both local authorities and citizens to take full advantage of the opportunities presented by decentralization, can lead to very different and disappointing outcomes. These include the perpetuation of local elites, deterioration of basic services, lack of scale and cohesion in the implementation of projects that cut across sub-national boundaries, and entrenchment of corruption.

After more than 28 years since it came into effect, significant advances have been made in realizing the goals of decentralization, but the quality, depth and breadth of these achievements are uneven. Poor local governance can still be found in some parts of the country. Counter-resistance to democratic reforms by political elites continue and a latent pushback towards recentralization exists.

The LGC has at best only undergone sporadic review even if Section 521 of the law states that the Congress shall “undertake a mandatory review of this Code at least once every five years and as often as it may deem necessary, with the primary objective of providing a more responsive and accountable local government structure.” One exception was the 2014 assessment of the LGC led by the Department of Interior and Local Government (DILG) with the support of the Asian Development Bank which focused on fiscal decentralization and proposing amendments to address gaps.6 The assessment, which involved extensive consultations with local government officials, private sector and legislators, identified many issues including: 1) overlapping and, at times, unclear assignment of functions across various levels of government; 2) unfunded mandates; 3) insufficient IRA; 4) LGU “subsidies” to national government agencies; 5) inadequate and/or ineffective revenue generation capacity; 6) The inability of the IRA formula to

6 http://calabarzon.dilg.gov.ph/reports-resources/328-review-of-the-1991-local-government-code http://calabarzon.dilg.gov.ph/reports-resources/328-review-of-the-1991-local-government-code

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promote “fiscal equalization in the sense of providing more resources to LGUs with lower revenue capacity relative to their needs and less to LGUs with greater revenue capacity; 7) Increasing fragmentation of sub-national political units; 8) need to ensure transparency in LGU operations for greater transparency; and 9) need to promote public financial management.

Although there are outstanding cases of good governance in a number of localities, there is unfortunately a paucity of comprehensive assessments focusing on the extent to which the implementation of decentralization has promoted democratic governance in the Philippines. In an analysis of binding constraints to intergovernmental fiscal arrangements, however, the World Bank Approach Paper on Decentralization Reforms (August 2010),7 identified the weak political and institutional environment for LGU accountability as a major concern. The paper contended that although the LGC instituted mechanisms to institutionalize citizen participation in the LGU planning and budgeting processes, primarily through special bodies such as the local development council and the local health and school boards, the functionality of these special bodies varied significantly across LGUs and the voice of non-government stakeholders in local governance is generally very weak. It added that no systematic information on LGU performance is available to allow voters to assess their local governments’ performance and use elections to reward good performers and punish laggards. The paper concluded that the weak systems for LGU accountability result in weak demand-side pressure for LGUs to function more efficiently as public service providers and as engines of economic growth.

The 2019 paper Pitfalls of Aiming to Empower the Bottom from the Top: The Case of Philippine Participatory Budgeting8 written by Joy Aceron of G-Watch for the Accountability Research Center pointed out that the stark reality in Philippine democratization and reform is the presence of interests that endeavor to stop pro-people and pro-accountability reforms. To better understand reform dynamics in the country, it is important to note that democratic measures, such as decentralization and civil society participation, face constant counter-resistance at all levels of government from political elites that are against reforms and the deepening of democracy. The Aceron paper contended, based on consultations with the Bottom Up Budgeting project management office of the DILG, that almost three decades after the LGC was passed, the minimum legal requirements for civil society representation remain unobserved in many local governments. Some of the mandated participatory bodies, including some LDCs, remain nonfunctional. She attributed this phenomenon to four factors: 1) the lack of sanctions for non-compliance with participation requirements; 2) intervention by local chief executives; 3) LGUs creating their own non-government organizations; and challenges in LGU accreditation.

The results of the papers and assessments above converge with USAID’s experience in supporting good local governance practices in the Philippines. A rapid field appraisal of decentralization conducted in 2010 by the USAID-funded Transparent and Accountable Governance Project of The Asia Foundation9 highlighted significant advancements in the implementation of decentralization but also noted the unevenness of its application. In localities

7 http://documents.worldbank.org/curated/en/379201468295534440/Approach-Paper-on-a-World-Bank-strategy-for-supporting-decentralization-reforms 8 https://accountabilityresearch.org/publication/pitfalls-of-aiming-to-empower-the-bottom-from-the-top-the-case-of-philippine-participatory-budgeting/ 9 https://asiafoundation.org/resources/pdfs/01Synopsis.pdf http://documents.worldbank.org/curated/en/379201468295534440/Approach-Paper-on-a-World-Bank-strategy-for-supporting-decentralization-reforms http://documents.worldbank.org/curated/en/379201468295534440/Approach-Paper-on-a-World-Bank-strategy-for-supporting-decentralization-reforms https://accountabilityresearch.org/publication/pitfalls-of-aiming-to-empower-the-bottom-from-the-top-the-case-of-philippine-participatory-budgeting/ https://accountabilityresearch.org/publication/pitfalls-of-aiming-to-empower-the-bottom-from-the-top-the-case-of-philippine-participatory-budgeting/ https://asiafoundation.org/resources/pdfs/01Synopsis.pdf

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where progress is slow, there appears to be a consensus about the lack of capacity on the part of both LGUs and constituents to maximize the opportunities offered by decentralization. Many elected local leaders and civil service staff did not have the institutional and administrative capacity to raise and manage revenue; consult and engage with communities; translate local preferences into prioritized programs and formulate budgets; report meaningfully and transparently; and create feedback loops. On the other hand, citizens did not necessarily know how to hold local governments accountable and demand good governance. They did not fully understand what functions different levels of government perform, what their responsibilities to government are, nor did they have any experience in using accountability mechanisms.

Finally, the playing field in both national and local arenas in the Philippines is rarely level. In addition to a supportive policy environment and the requisite capacity, political will to institute reforms and remove barriers to entry is necessary for democratization to flourish. Elite capture is a term frequently used to characterize local (and national) politics in the Philippines. Political dynasties because they enjoy name recall and access to the necessary resources, machinery and alliances have a near monopoly of major elected public positions in the country. In his article Political Dynasties in the Philippine Congress10, Dean Ronald Mendoza of the Ateneo University School of Government said that membership in a political dynasty increases an individual’s chances of being elected into office and allows the politician to constrain competition by excluding most citizens from participating in political leadership roles. To consolidate and maintain their grip on power and the benefits that come with it, it is often in the dynast’s interest to squelch initiatives that empower the citizenry.

C.3 LOCAL GOVERNANCE ENGAGEMENT OF USAID AND OTHER DONORS

Since the passage of the LGC in 1991, a variety of international donors, including USAID, have supported various aspects of good local governance. Ongoing and very recent activities of other donor partners that likely are relevant to this program description from the perspective of developing complementarity and avoiding duplication include the examples that follow.

The Local Governance Reform Program of the Asian Development Bank (ADB) supports inclusive and sustainable growth by increasing the capacity of local governments to provide accountable service delivery and boost local economic development. The program supports government reform priorities by a) strengthening the local governance framework; b) modernizing and professionalizing subnational public financial management; and c) improving the LGU financing and investment framework.11

The Department of Foreign Affairs and Trade (DFAT) of Australia works with the Philippine Government to implement public financial management reforms in support of practical budget and expenditure management reforms. DFAT provides human resource development assistance to support efforts to modernize and strengthen government institutions to enable more effective https://www.researchgate.net/publication/228276641_An_Empirical_Analysis_of_Political_Dynasties_in_t he_15th_Philippine_Congress/link/5de22c4092851c8364549e3c/download 11 https://www.adb.org/projects/documents/phi-52173-001-rrp https://www.researchgate.net/publication/228276641_An_Empirical_Analysis_of_Political_Dynasties_in_the_15th_Philippine_Congress/link/5de22c4092851c8364549e3c/download https://www.researchgate.net/publication/228276641_An_Empirical_Analysis_of_Political_Dynasties_in_the_15th_Philippine_Congress/link/5de22c4092851c8364549e3c/download https://www.adb.org/projects/documents/phi-52173-001-rrp

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service delivery. Australia’s Coalitions for Change Program works to strengthen civil society's capacity to engage government in constructive partnerships for policy reform.12

The European Union (EU) supports public empowerment and community engagement for good governance in order to empower civil society and communities to be engaged in local governance.13 The completed Local Government Finance and Development Project of the World Bank (WB) assisted participating LGUs to expand and upgrade their basic infrastructure, services, and facilities and in strengthening their capacities in municipal governance, investment planning, revenue generation, and project development and implementation.14

Equally important, aspects of USAID’s work in health, education, environmental management and disaster resilience require partnerships with local governments. USAID looks at the practice of good governance as both an end and as a means to an end. As mentioned previously, work that will be implemented under CHANGE is intended to complement ongoing and planned USAID activities in the health, environment and education sectors where possible and relevant. USAID strongly encourages the applicant to identify ways by which this activity will seek to assist and advance the agenda of other USAID technical sectors. For instance, interventions on public financial management and procurement reform could support the generation of additional resources for and accelerated implementation of local government priorities in education, health or social services. Support for reform coalitions that will engage with local government executives and legislative bodies could revolve around key issues like environmental management and protection. During implementation, the recipient will be expected to proactively reach out to other USAID implementing partners to ensure strategic and sustained coordination and collaboration, where appropriate. The website of USAID/Philippines15 provides substantial information on current activities in the country.

C.4 SCOPE OF WORK

C.4.1 Theory of Change

USAID’s theory of change is that local governance in the Philippines can be made more responsive if: a) the enabling environment for decentralization is strengthened; b) if the transparency, accountability and effectiveness of local governments to carry out its essential functions is enhanced; and c) if the participation of citizens, men and women, youth and adults alike, is increased.

Improved implementation of decentralization in the Philippines will help strengthen democratic governance in the country. Enabled local government institutions that are more transparent, participatory and accountable to their constituents will enhance their legitimacy

12 https://dfat.gov.au/geo/philippines/development-assistance/Pages/building-stronger-institutions-for-transparent-accountable-governance-philippines.aspx 13 https://eeas.europa.eu/delegations/philippines/53297/public-empowerment-and-community-engagement-good-governance-peece-good-governance_is 14 http://documents.worldbank.org/curated/en/346301468780912355/Philippines-Local-Government-Finance-and- Development-Project 15 https://www.usaid.gov/philippines https://dfat.gov.au/geo/philippines/development-assistance/Pages/building-stronger-institutions-for-transparent-accountable-governance-philippines.aspx https://dfat.gov.au/geo/philippines/development-assistance/Pages/building-stronger-institutions-for-transparent-accountable-governance-philippines.aspx https://eeas.europa.eu/delegations/philippines/53297/public-empowerment-and-community-engagement-good-governance-peece-good-governance_is https://eeas.europa.eu/delegations/philippines/53297/public-empowerment-and-community-engagement-good-governance-peece-good-governance_is http://documents.worldbank.org/curated/en/346301468780912355/Philippines-Local-Government-Finance-and-Development-Project http://documents.worldbank.org/curated/en/346301468780912355/Philippines-Local-Government-Finance-and-Development-Project https://www.usaid.gov/philippines

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and effectiveness. Citizens who have more awareness of and input into government decisions will be more empowered and have greater confidence in their government and the democratic system.

C.4.2 Statement of Work

The goal of CHANGE is to support strengthened democratic governance in the Philippines by making local governance more responsive. In doing so, CHANGE will contribute to the Indo-Pacific Vision by promoting sound, just, and responsive governance; and fostering the capacity of governments, civil society, and the private sector to make informed decisions about their choice of approaches and partners. As stated earlier, it will be implemented in two phases:

· Phase 1 will be implemented in eight secondary cities of the Philippines (Batangas, Legaspi, Puerto Princesa, Iloilo, Tagbilaran, Cagayan de Oro, Zamboanga and General Santos) and complement the activities of USAID’s SURGE activity.16 SURGE is a five-year, $47 million activity, which aims to foster the development of conditions for broad-based, inclusive and resilient economic growth for a critical mass of cities and surrounding areas outside Metro Manila, Cebu, and Davao.

SURGE works with cities and adjacent areas to plan effectively, guarantee basic public services, reduce business transaction costs, promote competitiveness, support sustainable development, and reduce disaster and climate change risks while ensuring inclusive and sustainable growth.

· Phase 2 will expand to additional cities that USAID will identify in conjunction with current efforts to develop a successor to its Cities Development Initiative and other programmatic considerations.

CHANGE will seek to achieve more responsive local governance through three objectives, namely: 1) strengthen the enabling environment for decentralization; 2) enhance service delivery capacity, legitimacy, transparency and accountability of participating local governments; and 3) empower citizens by increasing their participation in and oversight of local governance processes in ways that government both approves and support.

C.4.3 Expected Results and Work Requirements

Implementing CHANGE will require the effective integration of LGUs and their constituents and the strengthening of the institutions of governance and management at the local level. It will require close coordination with SURGE and other USAID sectoral activities that may also be operating in the present and future target cities.

Entry points for this activity may not be directly related to strengthening democratic governance per se but may nonetheless be a catalyst for achieving one or more of the sub-objectives below. Policy reform work at the national and local levels, including formulation and effective implementation, are anchored on the principle of thinking and working

16 https://icma.org/programs-and-projects/usaidsurge https://icma.org/programs-and-projects/usaidsurge

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politically. This requires a deep understanding of the political context and the application of this understanding to USAID’s work in order to maximize the results of its development investments. In addition to the excellent technical analysis done by the other sectors, the approaches inherent to the democracy, rights and governance (DRG) sector such as political economy analysis, constituency and coalition building, broad and strategic public participation, political advocacy, public financial management, and procurement reform can be applied just as appropriately to achieve health, environment and education outcomes at sub-national levels.

The effective and efficient delivery of basic services depend in large part on the capacity of local governments and the degree to which constituents can hold them accountable.

Mechanisms for public participation, transparency and accountability across all USAID sectors are embedded in the Local Government Code, including the establishment of local health boards, local school boards, peace and order councils and planning and development councils. Other local mechanisms include councils for specific sectors (e.g. protection of children), protected area management boards, and local legislative committees on gender and the youth. Supporting decentralization and good local governance, approaches central to promoting a stronger democratic system, in identified localities present tremendous potential for complementarity with other USAID activities outside of the DRG sphere.

The COVID-19 pandemic and the government’s response to contain it has added a further layer of complexity to the state of devolution and local governance in the Philippines. The need for a coordinated national response and the uneven application of measures to address the crisis as well as assist affected populations in localities has triggered renewed debate about where the line between executive supervision and local autonomy should be drawn. It has also raised questions about local government capacity to address large scale disasters, natural and man-made.

To contribute to achieving the higher-level goal of more responsive local governance, the contractor will design and implement activities and actions in the targeted areas that are related to the following results:

1. Strengthened enabling environment for decentralization

The underlying assumptions that underpin the implementation of decentralization in the Philippines is that it will hasten development by allowing sub-national government units to determine and respond to local needs; and expand democratic space by promoting citizen participation in local governance processes. Irrespective of whether the Philippines formally takes up proposals for a shift to federalism, there is a need to revisit and discuss key provisions of the LGC. Current evidence suggests that the results have been mixed with outstanding examples of successes in some cases juxtaposed with cases of inefficiencies arising from the lack of economy of scale or jurisdictional issues, non-compliance with key provisions of the law, elite capture, and corruption. While considerable analytical work has been done to look at the challenges of fiscal decentralization and the degree to which these challenges influence service delivery and

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development, there is a dearth of comprehensive assessments focusing on the impact of decentralization in promoting democratic governance.

CHANGE is designed to provide on-demand analytical support and strategic guidance to national and local policymakers to help ensure a stable and supportive policy framework for decentralization. This component will provide independent informed analysis of challenges and possible reforms in center-local relations and within sub-national government units that will promote both the spirit and intent of decentralization in the Philippines. One concrete example of needed analysis at this time is an in-depth assessment of the ramifications of the Supreme Court Mandanas Ruling (previously cited on page 2) which when implemented will significantly increase the IRA of LGUs but will most likely result in the passing to LGUs of more responsibilities (and financial burdens) currently being shouldered by national government agencies. The need to better understand the role of local governments in responding to a national or large scale crisis (e.g. the COVID-19 pandemic) is another example.

It will support the dissemination of the results of analyses and work with decentralization stakeholders, nationally or locally depending on need, to advocate reforms that will among others increase local government transparency, accountability and responsiveness, strengthen the role of citizens in local decision-making and holding government accountable. This component is also intended to serve as a launch pad to promote the replication of best practices in non-target cities through effective outreach.

The Contractor will:

● Provide analytical support and technical assistance to key decentralization stakeholders to inform the development of reforms in the implementation of decentralization or the policy framework around it;

● Support effective inter-government relations between target cities and relevant national government agencies;

● Streamline or rationalize planning processes to eliminate duplications and/or reduce the number of plans/reports that LGUs must prepare;

● Increase public awareness of, and opportunities to participate in, legislative processes or consultations related to decentralization reform;

● Develop comprehensive and coordinated strategic and change management plans if changes to the implementation of decentralization are planned.

● Identify entry points for the promotion of good governance practices in the target cities; and

● Support advocacy for good governance reforms and the replication of best practices in non-target cities.

The Contractor shall recommend additional activities that will contribute to strengthened enabling environment for decentralization.

2. Enhanced Service delivery capacity, legitimacy, transparency and accountability of participating local governments

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CHANGE is intended to complement the work of SURGE and possibly other USAID activities in the target cities by promoting and supporting practices that enhance good governance and increase the cities’ resilience to foreign influence in procurement and possibly the extraction of resources within their jurisdictions. On the supply side, it will work to support mechanisms and processes embodied in the LGC that increase transparency, accountability and citizen participation in local decision-making; address capacity gaps; reinforce the democratic processes that underpin these institutions, such as public participation through town halls, public hearings, third party oversight of local procurement, and citizen feedback mechanisms; and ensure local…