KISAN II JA- EPP Authority.pdf

JUSTIFICATION AND APPROVAL (J&A)

TO: Marva Butler, USAID/Nepal Contracting Officer

CC: Deborah Broderick, Agency Competition Advocate

FROM: Navin Hada, KISAN II Contracting Officer’s Representative (COR)

DATE: June 10, 2020

RE: Knowledge-Based Integrated Sustainable Agriculture in Nepal (KISAN) II, AID-

367-C-17-0001

SUBJECT: Justification for Other than Full and Open Competition under the Expedited

Procedures Package (EPP) for Responding to Outbreaks of Contagious Infectious

Diseases

We request approval of this justification for use of other than full and open competition pursuant to the authorities under the EPP for Responding to Outbreaks of Contagious Infectious Diseases

(the “Expedited Procedures Package”), approved on March 24, 2020. Your approval of this J&A constitutes the justification for other than full and open competition as required by Tab 1

(Determination and Findings (D&F) Authorization for the Use of Other than Full-and-Open

Competition in the Award or Modification of Contracts) of the EPP.

a. Nature and/or description of the action being approved.

This is a request to approve a contract modification to extend the KISAN II activity by 24 months, from July 11, 2022 to July 10, 2024, and increase the Total Estimated Cost of the contract by

$4,900,000 with FY 2019 and FY 2020 funds. The purpose of the proposed extension is to enable

Winrock International to respond to the second-order impacts of the COVID-19 pandemic on

Nepal’s agriculture sector and contribute to the recovery of the agriculture sector and economy from this crisis. With the additional funding and time, Winrock will partner with the private sector and will target populations highly affected by the COVID-19 pandemic and prolonged national lockdown, including recently returned migrants, youth, and women agri-entrepreneurs, among others. Winrock will facilitate increased private sector investment in staple food production and processing in order to increase food security during the pandemic, and will partner with farmers and the private sector to reinstate agriculture and food supply chains which have been severely disrupted by border closures and restrictions on movement. Winrock will create employment and generate incomes in rural areas which are bearing the brunt of COVID-19’s economic impact, particularly with the return of hundreds of thousands of now unemployed migrant laborers to rural areas during the pandemic. Winrock’s rapid response and recovery will help to foster inclusive agriculture-led economic growth to make Nepal more resilient during the ongoing COVID-19 crisis and in the face of future shocks and stresses.

J&A for COVID-19 noncompetitive actions under the EPP for Responding to Outbreaks of

Contagious Infectious Diseases

b. A description of the supplies or services required to meet USAID’s needs (including the estimated value).

Several key sectors of Nepal’s economy, including agriculture, will continue to be hard hit by the

COVID-19 pandemic, with the projected loss of revenue up to $1.7 billion. This affects incomes, employment, and the availability and accessibility of food for millions of Nepalis. The proposed cost extension will focus on responding to the impacts of COVID-19 on agriculture through technical assistance to 1) increase staple food production in partnership with the private sector, and 2) increase employment opportunities in agriculture for returned migrants and other affected populations.

1) Increase staple food production in partnership with the private sector: Given Nepal’s dependence on imports, the country will face shortages of staple foods in the domestic market if an aggressive agriculture recovery program is not well planned and executed in an effective and timely manner. As the most important staple food of the Nepali people, rice supplies about 40% of the population’s caloric intake and contributes nearly 20% to the Agricultural Gross Domestic Product (AGDP), and almost 7% to the national GDP.

Maize is an important food security crop in the mid-hills region, and is also a major input to livestock feed, a rapidly growing industry in Nepal which is also one of the most heavily affected agriculture sub-sectors by the COVID-19 crisis to date.

Through the proposed contract modification to respond to the impacts of COVID-19, Winrock will expand its private sector model for high-impact partnerships to rebuild and strengthen supply chain management for rice and maize, facilitate investment in technical upgrades and infrastructure improvements to strengthen private firms’ and agri-entrepreneurs' abilities to access technology such as digital tools which are critical for the ongoing and future pandemics, and will catalyze systemic change in the rice and maize subsectors in order to increase productivity and availability of these staple foods. The resulting increased productivity and competitiveness of these industries will drive growth in productivity and incomes for farmers during the period of recovery from the COVID-19 crisis and beyond, while also increasing the availability of staple foods for the Nepali population.

2) Increase employment opportunities in agriculture for returned migrants and other affected populations: Prior to the COVID-19 crisis, an estimated 70% of Nepal’s population worked in agriculture. With the forced repatriation of hundreds of thousands of migrant workers since the beginning of the pandemic, and many more expected to return in the months ahead, rural areas suddenly face a labor surplus, with returned migrants seeking employment and livelihood opportunities in a depressed economy. Agriculture will continue to be a leading employer in Nepal, and it is likely that a greater portion of the population will have to depend on agriculture until domestic and international travel and employment restrictions are eventually lifted. At the same time, the remittances upon which most Nepali rural households rely have sharply decreased as a result of the pandemic and lockdown, leaving households without one of their major sources of income. The creation of employment and livelihood opportunities in rural areas will therefore be a critical component of Nepal’s agricultural and economic recovery, and will help to mitigate against poverty backsliding.

The proposed cost extension will enable Winrock to respond to the increased stress on rural communities from the loss of remittances and the sudden influx of returned migrants by creating agribusiness opportunities for migrant returnees, youth, and women, as well as other affected populations, in the Feed the Future focus value chains. Winrock will partner with the private sector to attract migrant returnees, youth, women, and other affected populations to engage in entrepreneurial opportunities, particularly in high-value vegetables, goats, and lentils, and support overall recovery of the agriculture sector and economy. The focus will be to rapidly engage affected rural populations in employment and income-generating opportunities while sustainably strengthening agricultural market systems that will be able to withstand the COVID-19 pandemic and future shocks.

The proposed cost extension will not only enable the Contractor to support the recovery of Nepal’s agriculture sector, but will also sustainably increase the productivity, competitiveness, and resilience of Nepal’s agriculture sector and foster long-term inclusive agriculture-led economic growth. To support these interventions, Winrock will help to reinstate and strengthen coordination between the Government of Nepal (GON) at all three tiers, the private sector, and farmers. The estimated value of these services is $4,900,000.

c. Identification of statutory authority permitting other than full and open competition.

AIDAR 706.302-70(b)(3) and 40 U.S.C. §113; See the “Expedited Procedures Package for

Responding to Outbreaks of Contagious Infectious Diseases” approved March 24, 2020. The

D&F is attached to this file in Tab 1. The EPP can only be used for an Infectious Disease

Outbreak, as defined in paragraph 2 of the D&F (Tab 1). The COVID-19 outbreak was declared a Public Health Emergency of International Concern by the World Health Organization (WHO) on January 30, 2020 and therefore the class D&F applies to COVID-19 emergency response activities.

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

An effective and timely response to the second-order impacts of COVID-19 on Nepal's agriculture sector is critical in order to mitigate the negative impact of the pandemic and lockdown on the country’s food security and economic growth. With the COVID-19 crisis leading to a strict lockdown in Nepal and the closure of borders, KISAN II’s focus value chains of rice, maize, lentils, vegetables, and goats have suffered along with the entire agriculture sector from disrupted supply chains and markets, labor shortages on- and off-farm, as well as other challenges. An injection of capital and technical assistance from Winrock, in coordination with the GON and private sector, has the potential to reinvigorate and transform agriculture, generate much-needed employment and incomes, increase availability of staple foods, and contribute substantially to the rebuilding of

Nepal’s agriculture sector to one that is more competitive, dynamic, and resilient in the face of

COVID-19 and future shocks. The activities to be implemented under the proposed expansion are scalable and will strengthen the resilience of Nepal’s agriculture sector to future shocks, while aiding in the sector’s recovery from the negative impacts of the COVID-19 crisis.

KISAN II’s market system development approach is contributing to inclusive agricultural growth by increasing private sector investment in agriculture and increasing incomes of vulnerable households. Recognizing this successful approach, the GON is partnering with KISAN II in six districts to promote rice production and productivity to ensure the availability of food grain during the pandemic situation. In this partnership program during next rice season (for 7 months), GON is contributing $660,000, where KISAN II will contribute $200,000 and $150,000 by the private sector. RecentlyUnited Nations Development Programme (UNDP) has also requested the

Contractor’s partnership to scale KISAN II’s model of private sector engagement in their project implementation efforts and value its contribution to Nepal’s economic recovery from the COVID-

19 crisis.

A direct award to a local contractor was not considered because USAID does not deem any local contractors capable of providing the highly technical and specialized services required in a timely and cost-effective manner. KISAN II’s market systems approach, with its strong private sector orientation, is new to Nepal and marks a transition from the direct implementation approaches taken by many development partners, including USAID.

Full and open competition would result in unacceptable delays that would result in missing the key window of opportunity in which to rapidly respond to the impact of the COVID-19 crisis on agriculture in the coming months. Given the seasonality of agriculture, the time to complete a full and open competition would not enable the new contractor to effectively contribute to the COVID response and recovery.

e. A description of efforts made to ensure that offers are solicited from as many potential sources as is practicable.

The Contract with Winrock International for KISAN II was competitively sourced as required by

FAR 5.202 [AIDAR 705.002]. Because this is a modification of an existing award and these services are of critical need during the ongoing COVID-19 pandemic, no attempt has been made to solicit proposals from other sources.

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

Prior to award, the Contracting Officer (CO) made a determination that Winrock International met the overall RFP requirements, and that this TEC increase to KISAN II will substantially reduce cost and duration in comparison to holding a new full and open competition. As the KISAN II contractor, Winrock International has established systems and mechanisms to effectively implement KISAN II. In addition to the lengthy procurement process required for full and open competition, a new contractor would require additional time and money to establish itself in the market, build trust among local stakeholders, and put operational systems and processes in place, thereby causing significant delay and additional cost. The CO considered Winrock’s experience in the area of private sector engagement to increase the incomes of vulnerable farmers and a distinct opportunity for establishing interfaces and standardization of sustained agribusiness growth during and beyond the life of the ongoing COVID-19 pandemic and national lockdown. The CO also found that the technical approach of Winrock is more convincing due to its contributions to inclusive growth of the agriculture sector with increased incomes of vulnerable households and increased investment by the private sector. Based on these comparisons, the CO has determined that the anticipated cost of engaging the same Contractor to accomplish the expanded activities of

KISAN II to contribute to the COVID-19 response and recovery is fair and reasonable.

Further, the proposed modification cost or price information shall be obtained from the contractor prior to the award and a price/cost analysis will be performed and documented to sufficiently determine that the cost to the Government of the proposed acquisition is fair and reasonable.

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

Market research was not conducted. Given the urgency of this requirement in response to the

COVID-19 crisis, it is not feasible to select another contractor who is familiar with the breadth and scope of the work to be undertaken, and has the relationships with key stakeholders to be able to take on this work during a crisis. Additionally the 6-month urgent extension would not allow for sufficient time to bring in new partners through a competitive award process.

h. A listing of the sources, if any, that expressed, in writing, an interest in the acquisition.

Publication of a notice is not required per the determination at AIDAR §705.202(b).

i. A statement of the actions, if any, USAID may take to remove or overcome any barriers to competition before any subsequent acquisition of the supplies or services required.

In this urgent response to the COVID-19 crisis, USAID will intensify efforts to build the technical and institutional capacity of local organizations to participate in key activities, as it is anticipated that strengthening their capacity will expand the pool of potential offerors for future procurements and enable wider competition among local organizations.

If additional services are needed after the period of performance or beyond the scope of this contract, then a full and open competition will be planned.

RECOMMENDATION

It is recommended that you approve this justification for use of other than full and open competition pursuant to the “Expedited Procedures Package for Responding to Outbreaks of

Contagious Infectious Diseases”, approved on March 24, 2020. Your approval of this J&A constitutes the justification for other than full and open competition as required by Tab 1 (D&F for the Authorization of Less than Full and Open Competitive Procedures in the Modification or

Award of Contracts) of the EPP.

Ecl. Tab 1- EPP D&F for the Authorization of Less than Full and Open Competitive Procedures in the Modification or Award of Contracts.

CERTIFICATION:

The requirement for technical certification at FAR 6.303-1(c) is fulfilled through:

a. The signature of the Technical Officer below certifying the specific supporting data for this J&A; and

b. The D&F Authorization for the Use of Other than Full-and-Open Competition in the

Award or Modification of Contracts under the Expedited Procedures Package for

Responding to Outbreaks of Contagious Infectious Diseases” approved on March 24, 2020. (attached in Tab 1).

The Contracting Officer is the Approving Official based on the authority given under the EPP.

However, a separate Contracting Officer certification is not required per AIDAR 706.302-

70(c)(1).

Technical Officer:

I hereby certify that the supporting data which form a basis for the justification are complete and accurate to the best of my knowledge and belief.

Navin Hada, Technical Officer Date

APPROVAL:

Marva Butler, Contracting Officer Date:

CLEARANCE:

Cleared via email 06/10/2020

Mark Driver, RLO Date:

June 17, 2020

June 17, 2020