MISRA_JandA_EPP signed 03 24 2022.pdf

JUSTIFICATION AND APPROVAL FOR EXPEDITED PROCEDURES PACKAGE

TO: Robert Parnell, Regional Contracting Officer

CC: Deborah Broderick, Agency Competition Advocate, USAID/M/OAA

FROM: Corneliu Rusnac, Project Design Team Leader/Activity Planner

DATE: March 24, 2022

SUBJECT: Justification for Other than Full and Open Competition under the Expedited Procedures Package (EPP) for Ukraine, Belarus, and Moldova

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

Approval is requested for the justification for use of other than full and open competition pursuant to the authorities under the Expedited Acquisition and Assistance Procedures (EPP) for Ukraine, Belarus, and Moldova, approved on March 6, 2022. 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.

RECOMMENDATION

It is recommended that you approve this justification for use of other than full and open competition pursuant to the Action Memorandum “Expedited Procedures Package (EPP) for Ukraine, Belarus, and Moldova,” approved on March 6, 2022. Your approval of this J&A constitutes the justification for other than full and open competition as required by Tab 1 (D&F for the Authorization of Less than Full and Open Competitive Procedures in the Modification or Award of Contracts) of the EPP.

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

This is a request to approve a sole source award to Nathan Associates for $35 million to implement the Moldova Institutional and Structural Reform Activity (MISRA), with an estimated period of performance of five (5) years. Under this action, Nathan Associates will stimulate a sustainable and inclusive recovery from the regional crisis, improve the institutional, business, and trade enabling environment in Moldova by supporting Moldova’s public institutions and the private sector to accelerate the implementation of trade liberalization mechanisms, adopt structural and investment climate reforms, accelerate financial sector reforms, improve economic governance in the public sector, and enhance strategic communications between the private and public actors.

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

Through MISRA, USAID will focus on improving the institutional, business, and trade enabling environment in Moldova. To do this, the activity will support Moldova’s public institutions and the private sector to accelerate the implementation of trade liberalization mechanisms, adopt structural and investment climate reforms, accelerate financial sector reforms, improve economic governance in the public sector, and enhance strategic communications between the private and public actors. MISRA objectives are broken into four interconnected components, all working towards the above goals. The Economic Growth Office prepared an IGCE in the amount of $35 millions for the MISRA activity, which serves as a basis for budget negotiation.

Component 1: Strengthening public economic governance institutions for resilience and accountability The main objective of this component is to support the modernization and rethinking of business/citizen-centered public services by streamlining processes and incorporating the latest digital tools into the public systems, creating a regulatory and operational environment favorable for development and growth of businesses and service delivery in the virtual environments and stimulating the development of the digital economy. To do this, the activity will support public sector institutions to implement streamlined procedures and systems to improve their effectiveness and transparency; and assist supported institutions to reinforce integrity by complying with international standards.

Component 2: Pursuing structural reforms to improve the trade and investment enabling environment The main objective of this component is to support the GoM streamline its regulatory and operational practices to improve trade and the business enabling environment so that the country pursues a quick economic recovery. The component will be focusing on improving the investment climate in order to stimulate private sector investment to achieve more sustainable growth, increase the country's competitiveness, and create more and better jobs, while assisting to diversify its economy. Furthemore, as a result of the Russian aggression on Ukraine and thus nonfunctional trade corridors, supply chains, demand compression, etc. the activity will work on systems, procedures, abilities of the country to reorient business and trade flows towards EU borders, while creating incentives for businesses to come and stay in Moldova.

Component 3: Accelerating financial sector reforms and inclusiveness The main objectives of this component are to support development of an inclusive and resilient financial sector and support the infrastructure necessary to enhance its efficiency, transparency, and resilience. To do this, the activity will focus on enhancing financial sector governance by supporting the development of the necessary regulatory framework and capacity building of regulators. The activity will also focus on improving financial inclusion and promoting digitization in the financial sector services, broadly “FinTech,” with the goal of fostering greater efficiency, transparency, resilience, and empowerment across a variety of sectors (e.g., agriculture, health, education, energy, and/or governance).

Component 4: Enhancing strategic communications The main objective of this cross-cutting component is to improve the public’s understanding of, and support for efforts to overcome the economic crisis, generated by the Russian invasion of Ukraine and activities that improve the institutional, business, and trade enabling environment in Moldova. Through enhanced strategic communications, the activity will help generate momentum, from planning through the implementation stages, for trade liberalization and quick structural reforms. The activity will improve the way information about reforms and the reform process is related to businesses and the public at large. Doing this will create increased opportunities for public-private dialogue in order to increase private sector input into the reform lifecycle, and for working with media outlets to motivate citizens to advocate for and analyze reforms.

Cross cutting:

- IT procurements

The Contractor must set aside up to $4 million USD for IT procurements, to support the purchase of equipment, software, and/or services in order to advance Components 1-4. Given the uncertainty of predicting counterpart procurement needs across a multiyear activity, the IT procurement plans and budgets will be submitted to USAID on an annual basis with the annual work plan . The Contractor should explore opportunities for procurement to be cost-shared with local entities. Paired with relevant capacity-building activities, procurement should lay the foundation for identifying, utilizing, and scaling modern software and IT solutions, and/or services that allow Moldova to tackle challenges associated with each of the components in Section C.4.

The contractor must be aware of the FAR Part 4.21 ‘Prohibition On Contracting for Certain Covered Telecommunications And Video Surveillance Services or Equipment (Section 889)’ which will be incorporated into the final contract award.

- Grants Under Contract The goal of the Grants Under Contract component is to leverage sustainable, scalable partnerships with relevant public/private sector actors, civil society organizations, academic institutions/think tanks, etc. to support Moldova’s development and economic recovery.

Sub-grants may be used to promote westward movement of Moldovan trade, including support for logistics flows reorientation from Ukrainian trade affected infrastructure (roads, railway system and ports); development of logistic hubs; support enhancements for Moldova internal logistical capacities (possibly the Giurgiulesti Free international port to allow for an increased throughput capacity, or assessing the feasibility of developing the Marculesti airport, supporting investor awareness for potential opportunities), and streamline customs operations at the MD/EU border crossing points, including provision of technology to improve the experience at the congested borders. Grants may also be used to support relocation of R&D-Intensive businesses from the region, which would include in-country regulatory assistance, logistics assistance, and other support. The Contractor will allocate up to $3.5 million USD for grants.

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

AIDAR 706.302-70(b)(3)(ii) and 40 U.S.C. §113; see Action Memorandum entitled, Expedited Procedures Package (EPP) for Ukraine, Belarus, and Moldova, approved on March 6, 2022.

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

The unexpected aggression and rapidity of Russia’s invasion of Ukraine and the increasingly dangerous and unpredictable operating environment in the region have escalated USAID’s need for rapid and flexible programming in Moldova. More than 370000 Ukrainians have already fled to Moldova, overwhelming its resources and infrastructure, and creating a critical and urgent need to stimulate a sustainable and inclusive recovery for the Moldovan institutional, business, and trade-enabling environment.

The use of the EPP authority for using less than full-and-open competitive procedures for MISRA procurement will allow the Mission to expeditiously implement the activity in as responsive a manner as possible, supporting reforms and programs to stimulate economic recovery. Nathan is in a unique position to be able to leverage the capabilities of the existing Moldova Structural Reform Program, and speed Moldova’s recovery from COVID and the regional security crisis and serve the longer-term goals of establishing trust in institutions, cutting red tape, developing equitable regulatory systems that lead to inclusive economic growth, and strengthening Moldova’s economic ties with Europe. Nathan is a leading authority on trade policy formulations and their implementation, with a focus on infrastructure, logistics, technology, business, and government – from holistic, strategic, and tactical perspectives.

Over the past four years, through the Moldova Structural Reform Program (MSRP), Nathan has worked with a wide range of stakeholders in Moldova to cut red tape, contribute to improvements in institutions, policies, and processes, and develop a fair and less corrupt regulatory system that utilizes improvements in information technology and web-based applications. Nathan has developed a valuable network of contacts in the Government and with the private sector, opinion leaders, influencers, and change champions. Nathan’s ability to identify reform champions, achieve results, and build partnerships under the current MSRP in a challenging context makes them uniquely suited and situated to implement MISRA, which will build on MSRP results and expand and expedite the support for Moldova recovery from the regional crisis.

Building trust within the institutions of government and parliament as well as recruiting staff with sufficient expertise in Moldova has taken Nathan considerable time. Nathan already has the staff in place with the appropriate expertise and relationships with GOM to work in the areas considered for MISRA. The locally-hired staff demonstrated professionalism and proactive engagement, when promoting complex reforms, even in difficult political environments that Moldova has passed through. Nathan’s COP and Home Office were responsive to USAID and

Government of Moldova needs, thus creating a sense of reliance and trust for the outcomes.

CPAR reports outlining how Nathan has effectively engaged counterparts, allowing the activity to gain recognition and support from public officials to advance USAID objectives, are available on file for reference.

Nathan has accumulated a wealth of contextual knowledge, best practices, and relationships that will be necessary to act quickly on the reform opportunities that emerged as a result of the change in government.

The experience gained during MSRP implementation related to IT procurements and effective engagement with Government authorities, such as the Customs, Agency for Transportation, National Food Agency, the National Bank, National Commission for Financial Markets, etc.

serves as an additional argument for Nathan to expand on previous implementation efforts.

Bringing in a new contractor at this critical time would complicate USAID's ability to implement programming to mobilize technical, financial, and other resources quickly to respond to Russia’s invasion of Ukraine. Considering the previous experience, adaptability and the need for flexibility, for situational awareness and understanding of stakeholders, we believe Nathan is best placed to implement MISRA.

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

USAID Moldova issued a Request for Information to solicit public comments and suggestions on the draft Statement of Work (SOW) to inform the design process. This action generated comments from 6 companies: Nathan Associates Inc, International Development Group Advisory Services, LLC, Deloitte Consulting LLP, DAI Global, LLC, Chemonics, and APS LCC. The comments provided by these companies allowed USAID to better understand the marketplace and gauge the interest for work in Moldova. The review of the comments allowed us to understand the development challenges in Moldova. This RFI process has informed our market research and also built USAID confidence for availability of sufficient sources for MISRA activity.

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

The Economic Growth Office prepared an IGCE for MISRA implementation, which serves as the basis for budget approval. MISRA will be initially funded with $4.8M of FY19 funds (funds were notified through the FY 2019 CBJ cleared on Feb 12, 2018). The Contracting Officer will conduct cost analysis on the cost proposal to ensure costs are fair and reasonable.

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

USAID/Moldova/EG conducted market research using a series of procedures. As such, through the original Request for Information (RFI) responses we researched the capabilities of Nathan Associates Inc, International Development Group Advisory Services, LLC, Deloitte Consulting LLP, DAI Global, LLC, Chemonics, and APS LCC. The RFI informed the design process and also allowed for a better understanding of the marketplace and the interest for work in Moldova.

Additionally, the design team reviewed historical acquisition information (review of recent market research results for similar or identical supplies/services or previous USAID Contracts);

shared and discussed personal knowledge in procuring services of this type; searched the DEC to review and use relevant information; reviewed Internet resources.

Our market research determined that the small business community does not have an organization with the capacity to quickly respond and implement the requirement, due to the complexity and scale of the MISRA program, though consideration will be given to small business subcontracting.

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

USAID/Moldova has determined that, due to the urgency of responding to the current situation in Moldova resulting from the Russian invasion of Ukraine, other than full and open competition utilizing the authorities provided in the EPP is the most effective method for quickly and effectively implementing this activity and representing the priorities of the Agency and the U.S Government.

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

The Mission issued Request for Information No. RFI-117-22-000002 on January 31, 2022 and received responses from Nathan Associates Inc, International Development Group Advisory Services, LLC, Deloitte Consulting LLP, DAI Global, LLC, Chemonics, and APS LCC by the deadline of February 15, 2022.

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

The Mission will continue to use full and open competition procedures whenever possible, including potential set-asides for small businesses.

12. Technical or Requirements Personnel Certification:

In accordance with FAR 6.303, I hereby certify that the technical statements included above and which form a basis for the justification are complement and accurate in accordance with the Expedited Procedures Package (EPP) for Ukraine, Belarus, and Moldova approved March 6, 2022 (attached).

Corneliu Rusnac, Project Design Team Leader Date

13. General Counsel/RLO Clearance:

Mark Hyland, Regional Legal Officer Date

14. Contracting Officer Certification:

In accordance with FAR 6.303, I hereby certify that the justification is accurate and complete to the best of my knowledge and belief.

Robert Parnell, Regional Contracting Officer Date