FAQ on USAID Funding in Haiti: Procurement Process and Working with Local Firms and the Haitian Diaspora
Q: More than two years have passed since the earthquake; why hasn’t USAID delivered all of the total pledged aid to Haiti?
A: The plan was never to provide the entire pledged aid amount to Haiti in one full tranche. In the immediate aftermath of the earthquake, significant funds went towards immediate needs in Haiti, including search-and-rescue teams, emergency food assistance, emergency shelter, and safe drinking water. Following the tragic January 12, 2010, earthquake, the U.S. government (USG) has committed over $3.6 billion toward relief, recovery, and reconstruction. Additional funds for long-term recovery and reconstruction efforts are being provided incrementally over several years. As of June 30, 2012, $2.3 billion has been provided to support our focus on long-term reconstruction activities in key development pillars identified in the five-year United States Government (USG) Haiti strategy.
Q: What is the best way to begin doing business with USAID?
A: USAID utilizes various acquisition and assistance instruments to implement its activities. Contracts, grants, cooperative agreements, and purchase orders are some of the instruments which are negotiated and signed worldwide by USAID. We are committed to enhancing the way we deliver our programs in Haiti and encourage organizations and firms to regularly check www.fbo.gov and www.grants.gov for contract and grant opportunities.
For those that have not done business with USAID before, one of the best ways to become a direct recipient of USAID funding is to begin as a sub-awardee. USAID’s prime contractors often have a number of (local) sub-grantees who make great implementers, as they build technical capacity on how to meet USG requirements for managing funds. For example, two Haitian-American firms that were previous USAID sub-awardees are now managing multi-million dollar direct contracts.
USAID is making very deliberate efforts to build the capacity of these sub-awardees to receive U.S. funds directly in the future. A recent USAID solicitation for a new, large procurement requires the awardee to identify five local organizations to qualify as the primary implementers by year three and to be eligible to receive direct awards from USAID or face financial consequences.
Q: Why did the majority of post-earthquake funding go to American firms with ties to D.C.?
A: The majority of our funds expended after the earthquake went to respond quickly to emergencies and humanitarian crises; therefore, many of the initial awards went to large organizations with a proven capacity and track record.
USAID has now moved out of the emergency phase and into long-term reconstruction and development. We are doing business differently in Haiti to strengthen local capacity and continue to increase local contracting as more of our reconstruction programs are designed and awarded. Currently, USAID works directly with or through partners’ sub-awards with hundreds of Haitian non-governmental organizations (NGOs) and local vendors.
Q: What are the standards or criteria that USAID uses when selecting proposals by new local partners?
A: The standards or criteria that USAID uses when selecting proposals include but not limited to: 1) is the organization a registered NGO or a private volunteer organization (PVO); 2) past performance; 3) program cost, 4) financial responsibility.
Key evaluation factors for all proposals generally include, but not limited to:
- Registered NGO/PVO: USAID requires that the organization is registered in the U.S. NGO/PVO data system.
- Past Performance: This is a key factor for predicting successful performance, so organizations will want to ensure that they have relevant and recent past performance.
- Cost: USAID expects that best offers are provided in the proposal an organization submits. USAID aims to keep administrative costs low to use most of its funding for the implementation of its programs.
- Responsibility: USAID must make a responsibility determination based on the financial soundness and organization. If a USAID Contracting or Agreement Officer cannot make a positive pre-award responsibility determination, they may undertake a formal selection survey involving a pre-award audit of the organization.
USAID also encourages firms to do the necessary research before submitting an application. Once a proposal is submitted, evaluators check that it adheres to the submission deadline, meets the eligibility requirements, and complies with the instructions for submission including page limitation—pages beyond the limit are not evaluated.
Other specialized aspects that USAID generally considers include, but are not limited to, proposals with an emphasis on gender equality and female empowerment, effective implementation of environmental impact assessments, and the ability to work with small businesses and local partners.
For more information on becoming a registered organization and proposal criteria, click here.
Q. How is USAID helping to build the capacity of Haitian firms to meet these requirements?
A: The USG has made a long-term commitment to helping Haiti recover and rebuild. Integral to our assistance is a strong effort to help build the capacity of local NGOs, businesses, and the Government of Haiti so that the country can lead its own development. Empowering and educating the people of Haiti is critical, and USAID is working to help strengthen local organizations through partnerships.
To increase the number of firms who compete, the first step to increasing our partner base is outreach.
In Haiti, “How to Do Business with USAID” seminars are regularly conducted. When USAID hosts pre-award conferences, generally more than 50 individuals from varied organizations attend, including Government of Haiti representatives.
USAID is also working to help strengthen local firms’ financial capacity through a Blanket Purchase Agreement (BPA) with local accounting firms. The BPA allows local organizations learn to manage USAID funds in accordance with USAID regulations and USG financial standards.
Here are some additional business practices USAID is implementing to help strengthen capacity of Haitian firms and NGOs:
- USAID makes every effort to make local and international communities aware of ongoing business opportunities through regular announcements.
- USAID conducts assessments of local NGOs in order to provide technical assistance to build their organizational capacity to receive direct awards.
- As appropriate and to the extent possible, USAID holds meetings after an award is made to review the winning bid or explain award decisions with unsuccessful bidders in accordance with all applicable USAID regulations and policy standards.
- USAID maximizes allowable set-asides for U.S. small business concerns, including minority and women owned businesses, when appropriate.
Q: How many local Haitian firms and organizations does USAID work with?
A: Since the earthquake, USAID has worked directly or indirectly through partners’ sub-awards with more than 400 Haitian NGOs and firms and hundreds of local vendors. Additionally, many non-Haitian firms that win awards often employ Haitian or Haitian-Americans via sub awards and hire Haitians and Haitian-Americans as staff for implementation of projects. Whenever possible, USAID supports local organizations to implement activities. The following are examples of both current and past partners:
- Experts Conseils & Associates (ECA), Pierre Andre Guillame & Associates (PAGS), and Merove-Pierre & Associates are authorized certified public accounting firms providing financial management services to USAID in Haiti.
- La Fondation Heritage pour Haiti (LFHH—a local chapter of Transparency International) is a local NGO supporting anti-corruption activities.
- Le Groupe Haitien D’Etude du Sarcome de Kaposi et des Infections Opportunistes (GHESKIO) is a local organization that received funding from USAID for health-related activities.
- L’Atelier S.A. is a Haitian construction firm based in Cap Haitian that has been awarded funds to construct a public market in Bas Limbe.
Q. What are the challenges of working with local firms?
A: USAID is eager to partner and collaborate with local firms as they bring unique and diverse perspectives that enhance program development. Unfortunately, many of these organizations lack the capacity necessary to comply with our rigorous business agreement requirements or operate only in the informal sector. For these reasons, USAID is providing financial services to our partners and working with local organizations to build their financial capacity to receive direct awards.
Q. With so many informal businesses operating in Haiti, what is the incentive to Haitian businesses to formalize and register with the Government of Haiti?
A: Formally registering with the Government of Haiti not only increases a local firm’s business opportunities, but it also provides other incentives.
- Local firms that operate in the formal sector have access to government services and bank financing as well as easier access to projects and programs offered by international donors.
- By working in the formal sector, Haitian firms improve their chances of becoming sub-grantees for USAID projects, which could ultimately help these organizations build their capacity to compete for direct awards.
Small and medium sized enterprises (SMEs) in Haiti also have the opportunity to receive credit guarantees through USAID’s Development Credit Agreement (DCA).
- Guarantees under USAID’s DCA aim to boost Haiti’s economic recovery and help rebuild the private sector by strengthening local lending to SMEs in areas such as agriculture, construction, housing, garment and light manufacturing, and information and communication technology.
- Loans are focused within the Northern Corridor, Saint-Marc Corridor, and Cul-de-Sac, complementing other USAID programs in these priority areas.
Q: Haitian-American firms and members of the diaspora community are eager to use their expertise to help rebuild Haiti. How is USAID working with this community?
A: Haitian-Americans have unique skills that are instrumental in helping Haiti based on language and knowledge of the country. USAID has provided four direct awards to CEEPCO and two direct awards to PHS Group Inc.—which are both Haitian-American firms. USAID would like to work with more Haitian-American organizations and has several programs that specifically aim to attract Haitian expertise and leverage support provided by the Haitian diaspora community, such as:
- Emergency Capacity Assistance Program (ECAP) leverages the expertise of Haitian diaspora to strengthen local public institutions involved in the shelter sector to develop and implement plans to guide growth and improve urban management in Haiti, ensuring efficient use of both financial and natural resources.
- Leveraging Effective Application of Direct Investments (LEAD) will improve access to investment capital for Haitian businesses and strengthen their business skills. The project aims to attract investments in Haitian small and medium enterprises (SMEs) through a matching grants program; USAID anticipates that potential investors in Haitian SMEs will include members of the Haitian Diaspora.
- Employment opportunities for diaspora are being created by USAID through our traditional process of posting solicitations for new awards in Haiti (www.fbo.gov and www.grants.gov). USAID highlights Haitian diaspora skill sets as appropriate for these awards.
USAID also participates in and organizes outreach events in the United States to provide information to Haitian diaspora on how to do business with USAID. These events include town halls and seminars on “How to do Business with USAID” in areas with significant Haitian diaspora populations such as Miami, New York, and New Jersey.
Last updated: May 10, 2013