J&A_18-112.pdf

{i)~,~!\1'2 1 KYRGYZ REPUBLIC

- ..M.-2!7

JUSTIFICATION AND APPROVAL FOR OTHER THAN FULL AND OPEN COMPETITION

(J&A)

To: Deborah Broderick, Agency Competition Advocate

Through: Jonathan Chappell, Contracting Officer

From: Guljan Tolbaeva, Contracting Officer Representative for Time to Read

Date: April 13, 2018

SUBJECT: JUSTIFICATION AND APPROVAL FOR OTHER THAN FULL AND OPEN

COMPETITION (J&A)

1. This document sets forth the facts and rationale justifying the use of other than full and open competition, in accordance with AIDAR 706.302. This document was prepared by USAID/Kyrgyz Republic Health and Education Office.

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

This is a request to approve a modification to Contract AID-176-C-16-00004 ("Contract") to Chemonics International, Inc. ("Chemonics" or "Contractor"), increasing the Contract's total estimated cost (TEC) of $7,932,533 by approximately $2,000,000, and extending the expiration date of the Contract for 12 months, from September 30, 2019 to September 30, 2020. Under this Contract Chemonics is carrying out the Time to Read (TtR) activity, which commenced on October 1, 2016, and aims to improve reading outcomes among Kyrgyzstani primary grade students.

Under the requested modification, Chemonics will complete the Contract scope of work for TtR by: providing educators with in-service training in reading instruction; refining and expanding the unique Developmental Reading Ladder tool to level books created under this award; increasing the availability of age-appropriate reading materials in mother-tongue languages, specifically Kyrgyz and Russian; fostering Kyrgyz government support for reading through capacity building in the area of reading instruction and use of assessments to monitor reading progress; and creating partnerships and innovations that support literacy outcomes. Similarly, Chemonics will complete its Contract work by providing pre-service training and expand the capacity of local authors to develop appropriate reading materials, as well as conduct an endline early grade reading assessment (EGRA) to measure student reading outcomes.

This Contract modification is needed to accomplish two very important purposes. First, it will make up for the one year delay in the startup of the Contract work caused by factors beyond the control of the Contractor and allow the Contractor to complete the work that USAID/Kyrgyz Republic (USAID/KR or Mission) contracted it to do. Specifically, negotiations between

Justification and Approval USAID!Kyrgyz Republic Time to Read

Contract AID-176-C-16-00004

USAID/KR and the Government of the Kyrgyz Republic's Ministry of Education and Science (MoES) over the terms of a Memorandum of Understanding (MoU) for this Contract work were completed almost one year into the term of the Contract, as the MoU was signed on August 23, 2017 with an expiration date of December 31, 2020. Until that MoU was signed, the Contractor was unable to start any Contract work with local schools or do any Contract work involving outward facing teacher training and public events. Those MoU negotiations delayed implementation of the Contract work for effectively one year, and this one-year extension of the Contract is needed to allow the Contractor to make up for that lost time and fully complete the Contract work.

Second, the Contract modification will ensure a smooth programmatic transition from the Contract to a new education mechanism (discussed in section 6 below), which will be operationalized after a full and open competition. The Mission expects to make that transition in the fourth quarter of FY 2020.

Without this Contract modification, the Contractor will be unable to complete the Contract scope of work, leaving a large gap (up to 12 months) in critical primary education programming at the Mission until the new mechanism is fully operational. As discussed below, the Mission does not believe that a new contractor could complete the unfinished work under the Contract in a timely fashion and fill the programming gap and, even if that were possible, it would be a significant waste of USG resources to hire a new contractor compared to the Contract modification. The Contract modification is the best value for money because the Contractor would be given the time it needs to achieve the best Contract outcomes and USAID/KR would have time to base its next education mechanism off of the lessons learned under the Contract. In short, the most viable, cost effective way to complete the work under the Contractor and bridge the gap between the end of the Contract and the new education mechanism is to modify the Contract as requested in this memorandum.

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

Following a full and open competition, USAID/KR awarded a cost-plus-fixed-fee award to Chemonics on September 28, 2016 to implement TtR. The Contract is a three-year award with no option years and a period of performance from October 1, 2016-September 30, 2019. The Contract ceiling price is $7,932,533. The total obligation from September 2016 to February 2018 is $5, 724,000 using FY 2015 and FY 2016 basic education directed funds. The TtR activity expenditure rate prior to signing the MoU was $127,213/month for a total of $1,399,343 over 11 months, which covered operational costs and initial development of materials but not implementation of Contract activities such as interventions with local schools or outward facing teacher training and public events. Since the MoU signing, Chemonics under TtR quickly rolled out interventions and the expenditure rate increased to approximately $292,902/month.

Extending the Contract by one year at this time would allow Chemonics to immediately scale up activities to complete the Contract scope of work, space out interventions in schools more appropriately and in accordance with the academic year, and achieve the targets set in the Contract. This extension would also give Chemonics adequate time for follow up, monitoring, and adjustments, which are crucial elements necessary to aid educators in applying the new strategies and affect student outcomes.

The Contract TEC increase will allow for the Contractor to increase activities consistent with the current Contract scope of work that will improve the sustainability and evaluation of its

USAIDIK.yrgyz Republic Time to Read

Contract AID-176-C-16-00004 interventions, such as working with pre-service training institutes, expanding the capacity of local authors to develop grade-appropriate reading materials necessary to utilize the new Developmental Reading Ladder tool, and conducting an end line early grade reading assessment. Pre-service training at pedagogical institutes relies on outdated approaches that are not aligned with in-service teacher expectations; thus, the lack of continuity between teacher preparation programs and on-the-job expectations results in continual "re-training" and "re orienting" of new entrants to the teaching profession. The Developmental Reading Ladder tool is the first of its kind in the post-Soviet context and has been embraced by MoES in shaping how students learn to read as they move through the primary school grades, but it is a completely new concept for educators to incorporate into their instruction. The Contract modification will give Chemonics the time and resources to implement the tool with stakeholders and practitioners and foster sustainability and institutionalization of this new method. The increase of the total estimated cost of approximately $2,000,000 is based on the Independent Government Cost Estimate that accounts for the direct and indirect costs and fees associated with the increase in activities described in this paragraph and the additional time necessary to complete the Contract scope of work.

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

The USAID Acquisition Regulation (AIDAR) Subpart 706.302-70(a)(2) permits other than full and open competition when this would impair or otherwise have an adverse effect on programs conducted for the purposes of foreign aid, relief, and rehabilitation. In particular, AIDAR 706.203-70(b)(5) stipulates that "An award for the continued provision of highly specialized services when award to another resource would result in substantial additional costs to the Government or would result in unacceptable delays." The current request meets this criterion as demonstrated in the following discussion.

5. A demonstration that the proposed contractor's unique qualifications or the nature of the acquisition that requires use of the authority cited:

Nature of the Acquisition Throu"gh the Contract's TtR activity, USAID supports MoES's efforts to reform the primary education system, particularly in the area of reading . TtR works with MoES, its affiliates such as the Kyrgyz Academy of Education, in-service teacher training institutes, educational specialists, testing centers, schools, communities, and the private sector. Interventions include training tailored to specific educator groups such as school directors, deputy directors, teachers, librarians, methodologists, and pedagogical faculty; creation of the Development Reading Ladder tool and accompanying leveled readers that help students progress through the stages of learning to read in a systematic manner; capacity building for local authors and illustrators to produce mother-tongue, age-appropriate reading materials; and support to the Kyrgyz Government to strengthen its capacity to provide quality reading instruction. While the previous basic education activity covered 60% of primary schools nationwide, the TtR activity being carried out under the Contract covers the remaining 40% of schools and provides follow-up support to an additional 200 schools. This approach and suite of interventions ensures that the national government is prepared to sustain and scale up USAID's successfu l approaches. This activity fully aligns with the USAID Global Education Strategy Goal 1.

Contractor's Unique Qualifications USAID instructed Chemonics to reach 900 primary schools across the Kyrgyz Republic in order to improve primary grade reading skil ls in consultation with MoES and at MoES's request to

USAID/Kyrgyz Republic Time to Read

Contract AID-176-C-16-00004 reach the remaining 40% of schools not covered under the previous activity. Chemonics now has a well-established relationship with MoES as evidenced by the approval of training packages, cohort rollout, and support for the Developmental Reading Ladder tool. MoES considers the Developmental Reading Ladder a revolutionary tool that provides a framework for improving students' foundational reading skills. The National Reading Steering Committee accepted the Developmental Reading Ladder tool and wants it further refined and rolled out nationwide. As no such tool existed in Central Asia prior to TtR, Chemonics worked with local stakeholders and reading experts to design a tool that reflected language development and reading acquisition in the Kyrgyz and Russian languages and incorporated MoES's principles and learning standards for reading instruction. As such, Chemonics now possesses unique expertise related to the Development Reading Ladder tool and has a singular advantage in being able to provide the associated professional development and accompanying reading materials to pilot and roll out.

Impairment to Foreign Aid Programs Due to the one-year delay in the startup of the Contract work related to USAID/KR-MoES MoU, a prerequisite for commencing the work under the Contract, Chemonics is for all intents and purposes in the middle of the second year of its three-year contract. That means that there is much work remaining to be done under the Contract such as teacher training and rolling out the Developmental Reading Ladder. If the Contract is not extended and the remaining Contract work not carried out, the USAID/KR education program will be significantly impaired. The Contract modification will allow USAID to implement the TtR activity fully, reaching 900 primary schools and their teachers through close coordination with the host country government and educational institutions. Full completion is needed to achieve the shared goals of the Government of the Kyrgyz Republic and the USG as reflected in the USAID/KR-MoES MoU. If these shared goals are not met, there is no doubt that USAID's education program in the Kyrgyz Republic will be impaired and concern that USAID's entire development program in the Kyrgyz Republic could be impaired because of reputational damage to USAID as a reliable development partner. The gap in the Mission's education programming which will be created if the Contract is not modified will undermine successes to date and set the Mission's education program back significantly. USAID/KR firmly believes that the only viable, cost-effective way to meet these shared goals and avoid the programming gap is to modify the Contract.

To put in place a new contract to carry out the unfinished work under the Contract after its currently scheduled expiration on September 30, 2019 would result in substantial additional costs to the USG and unacceptable delays.

Costs. The current Contract scope of work has strong buy-in from MoES and is based on a well researched reading intervention. Any new contract would, therefore, be based on identical implementation methodology. To put in place a new contract that duplicates the activities and objectives of the current Contract would result in substantial additional costs. That is because putting in place a new contract would incur significant redundant costs such as hiring additional staff, office rent, and start-up expenses. Based on the current Contract costs for staff, equipment, and other direct costs , procuring a new contract to perform the same activities would lead to approximately $1 .5-$2 million in duplicative costs, a huge waste of resources for the

USG.

Delays. Putting in place a new contracting mechanism to finish the scope of work under the Chemonics Contract would also result in unacceptable delays. Such a new contract would take 2-3 months of internal Agency work to produce all internal documentation and another 9 months

USA/D/Kyrgyz Republic Time to Read

Contract AID-176-C-16-00004 to procure with the new contractor. Subsequently, the new contractor would need time to mobilize its staff and go about the essential task of establishing new relationships among the key stakeholders and with MoES. This would create an additional delay of 6-12 months (it is very possible that USAID/KR would have to negotiate a new MoU with the MoES for the work of the new contractor, creating additional delays). By the time that all of this is done, the new contractor would most probably be fully operational and in a position to carry out the unfinished work under the Contract in the fourth quarter of FY 2020, which would mean an unacceptable delay of almost 12 months. That would represent a large programming gap in the Mission's education program and would not bring such a new contract on line substantially before the new education mechanism discussed in Section 6.

Why the J&A is Being Submitted for Approval Now. While the Contract currently expires on September 30, 2019, it is critical to TtR program success for this J&A to be approved now. As explained in the following three paragraphs, this J&A cannot wait for FY 2019. That would be too late to have any meaningful effect on Contract implementation.

Due to the delay in the startup of the Contract work, the Contractor has not yet begun pre service training of primary school educators, which is an important TtR programming element.

Work plans for that training must be formulated, approved by USAID and then MoES, and then, once approved, organized and scheduled with those educators during their September - May academic years in many pedagogical institutes across Kyrgyzstan. Because this training requires a lead time of over one year, no pre-service training is possible until the 2019-2020 academic year, which would begin about the time the Contract is now scheduled to end. Thus, the Contractor will not be in a position of carrying out any of this pre-service training unless it is notified soon that the Contract will extended to September 30, 2020 so that it will have a basis to begin work on meeting that one-year lead time. Otherwise, the Contractor will rightly assume that the Contract will end before any pre-service training is possible.

Much the same is the case for in-service training, which involves over 7,000 teachers in 900 primary grade schools over the three years of the Contract. In-service training takes place at multiple times in the summer before and during the September - May school year with follow-up training and monitoring in succeeding school years but can only be carried out by the Contractor after work plans for that training have been approved by USAID and MoES and in service trainings have been organized and scheduled. In-service training of this magnitude is a big logistical undertaking requiring a long lead time of at least one year. Because of the MoU related delay in Contract start-up, the Contractor will not have enough lead time to get the in service trainings approved, organized, and scheduled for all these teachers unless the Contractor is notified soon that the Contract will extended to September 30, 2020. Otherwise, the Contractor will rightly assume that it should plan for one more training cycle related to the 2018-2019 school year, and many teachers who would have been trained (either initially or in follow-up) in what would have been, but for the MoU-related delay, the Contractor's third Contract year will be left out.

Producing books to take full advantage of the Development Reading Ladder tool is another reason for the J&A to be approved now. The tool has been approved but full utilization requires the preparation and publication of grade-appropriate readers. Again, this part of the Contract work requires a long lead time of length similar to the pre-service and in-service training.

Authors and illustrators for the books must be identified and given time to create and edit their books, which then have to be reviewed and approved by USAID and the MoES. After that, the books must be published and distributed to schools, and teachers in those schools have to be

USAID/Kyrgyz Republic Time to Read

Contract A/D-176-C-16-00004 trained in how to use the books as grade-appropriate readers. Unless the Contractor is notified soon that the Contract will be extended to September 30, 2020, the Contractor will not have enough lead time to get all of these books created, approved, published and distributed to trained teachers, and rightly assume that it only has time under the Contract to work on some of the books.

Rationale for why a direct award to local contractor(s) was not considered At this time, no local contractor has been engaged in this type of work or has expertise and skills in the EGRA or Developmental Reading Ladder tool, which are new concepts for educators in the country, to conduct such interventions at national scale.

6. Description of the efforts made to ensure that offers are solicited from as many potential sources as practicable, including whether a notice was or will be publicized as required by Federal Acquisition Regulation (FAR) 5.202 [AIDAR 705.002].

Following a full and open competition, USAIDIKyrgyz Republic awarded the Contract to Chemonics on September 28, 2016. A Notice of Intent regarding the proposed Contract modification was posted on February 22, 2018, and there were no inquiries. This J&A, when finalized, will be posted according to the requirements of FAR 6.305.

USAID/KR plans to compete a new education mechanism in full alignment with the USAID Global Education Strategy as a follow-on to the TtR Contract. This new education mechanism will continue to focus on basic education and in fact continue to implement many of the activities now being carried out under the TtR Contract, such as pre-service and in-service training of primary school educators and expanding the roll-out of the Development Reading Ladder tool to new schools. The new mechanism will also engage in some new activities like supporting MoES's efforts to strengthen the education system and improve outcomes among non-Kyrgyz and non-Russian speaking primary grade students. USAID will publicize the notice for the new award in accordance with FAR 5.201 and will use full and open competition.

USAID/KR expects to advertise the new mechanism at the end of FY 2019 and anticipates that the new mechanism will be fully operational, after mobilization of the awardee and negotiation of a new MoU with MoES (which will be required given the new programming elements and the current expiration date of the current MoU) in FY 2020. The requested Contract modification to September 30, 2020 will dovetail nicely with the USAID/KR's plans for operationalizing the new mechanism to take over education programming in Kyrgyzstan while the Contract as extended is being demobilized.

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

Prior to awarding the modification, the Contracting Officer will review the proposed costs and make a determination as to whether the costs are fair and reasonable. Considering that the work to be performed under this extension is related closely to the original design and all costs for the initial award were found to be fair and reasonable, the Contracting Officer anticipates the costs for the increase to be fair and reasonable.

8. Description of the market research conducted, and the results or a statement of the reasons market research was not conducted:

lJSAID/Kyrgyz Republic Time to Read

Contract AID-176-C-16-00004

This action is a request to approve a cost and time increase of an existing contract. During the initial competition, market research found several large US-based for-profit organizations were available to implement complex regional education programs; however, the proposal pool for the award was quite small. The initial competition for this award demonstrated, through the evaluation of technical capabilities, costs, and past performance, that the current contractor offered the best value to the government. The proposed increase is for activities that were originally contemplated during that competition and thus do not affect this determination. Additionally, market research will be conducted during the design phase for the next mechanism to ensure that any new full and open competition surveys the market.

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

Without the requisite approval of the MoES, no contract for TtR can be implemented in any Kyrgyz Republic school or pedagogical institute. At present the Contractor is carrying out TtR with MoES approval as given in the MoU signed on August 23, 2017. The requested Contract modification fits squarely within the MoU and no amendment or modification of that MoU is needed to carry out the Contract modification. Chemonics has worked hard to develop and cement a strong relationship with MoES.

If USAID were to hire a new contractor to finish the work under the current Contract, MoES would need to be consulted before that new contractor could register, mobilize and begin any work. It is very possible that MoES would require a new MoU for a new contractor since the current MoU was negotiated with MoES under the understanding that Chemonics would be the implementing party carrying out TtR. Since it took USAID/KR one year to negotiate the current MoU, USAID/KR assumes that a new MoU for a new contractor would take that long. Even if MoES did not insist on a new MoU, MoES would need to be convinced that such a new contractor would be an effective and trustworthy partner before that new contractor could begin any TtR work. Delays of some length attributable to properly satisfying MoES, USAID/KR believes, are unavoidable if USAID were to hire a new contractor to complete the TtR activity.

Given Chemonics' strong position with MoES as the TtR Contractor and the unavoidable delays with MoES associated with hiring a new contractor to complete the unfinished Contract work further support the use of other than full and open competition for this Contract modification.

Chemonics's most recent interim CPARS ratings for the 2016-2017 cycle were rated as follows:

"Quality - Satisfactory, Schedule - Satisfactory, Cost Control - Satisfactory, Management - Very Good, Regulatory Compliance - Satisfactory, and Other Areas - Satisfactory".

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

No sources expressed interest in response to the Mission's Notice of Intent posted on February 22, 2018.

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:

No barriers to competition are foreseen for the next mechanism, which will be fully competed.

12. Technical or requirement personnel certification:

USAID/Kyrgyz Republic Time to Read

Contract AID-176-C-16-00004

In accordance with FAR 6.303.2(b), I hereby certify that the technical statements included above and which form a basis for the justification are complement and accurate .

. ] Jl; U-,- Guljan Tolbaeva Date USAID/KR Technical Office Representative

13. Contracting Officer Certifications:

I hereby certify that the justification is accurate and complete to the best of my knowledge and

~e~.MJc-----:- Jon~thirlaPPen USAID/CA Contracting Officer

Date