[Federal Register Volume 72, Number 113 (Wednesday, June 13, 2007)]
[Rules and Regulations]
[Pages 32540-32546]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-11093]
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AGENCY FOR INTERNATIONAL DEVELOPMENT
48 CFR Parts 719 and 752
RIN 0412-AA58
Mentor-Prot[eacute]g[eacute] Program
AGENCY: U.S. Agency for International Development (USAID).
ACTION: Final Rule.
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SUMMARY: The United States Agency for International Development (USAID)
is issuing this final rule to amend its acquisition regulations to
formally encourage USAID prime contractors to assist small business,
including veteran-owned small business, service-disabled veteran-owned
small business, HUBZone, small socially and
[[Page 32541]]
economically disadvantaged business, and women-owned small business, in
enhancing their capabilities to perform contracts and subcontracts for
USAID and other Federal agencies. The program seeks to increase the
base of small business eligible to perform USAID contracts and
subcontracts. The program also seeks to foster long-term business
relationships between USAID prime contractors and small business
entities and to increase the overall number of small business entities
that receive USAID contracts, and subcontract awards.
DATES: Effective Date: This rule will take effect July 13, 2007.
FOR FURTHER INFORMATION CONTACT: Rockfeler P. Herisse, Ph.D., U.S.
Agency for International Development, Attn. Mentor-
Prot[eacute]g[eacute] Program, Office of Small and Disadvantaged
Business Utilization, 1300 Pennsylvania Avenue, NW., Washington, DC
20523-7800, Telephone: 202-712-0064, and E-mail: [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
II. Resolution of Comments
III. Procedural Requirements
A. Review Under Executive Order 12866
B. Review Under Executive Order 12988
C. Review Under the Regulatory Flexibility Act
D. Review Under the Paperwork Reduction Act
E. Review Under Executive Order 12612
F. Review Under the Unfunded Mandates Reform Act of 1995
I. Background
On November 22, 2006, the U.S. Agency for International Development
(USAID) published a notice of proposed rulemaking (71 FR 67518), which
proposed to develop a program that encouraged USAID prime contractors
to assist small business, including veteran-owned small business,
service-disabled small business, HUBZone, small socially and
economically disadvantaged business, and women-owned small business in
enhancing their capabilities to perform contracts and subcontracts for
USAID and other Federal agencies. Comments on this proposed rule were
extended to and closed on February 22, 2007 (71 FR 70939).
Successful Mentor-Prot[eacute]g[eacute] arrangements represent
opportunities for creating access for small business to USAID contracts
and awards let through negotiated procurements. USAID received comments
on the proposed rule suggesting the Agency clarify the eligible
participants in the Program and the types of incentives USAID may
provide to prime contractors for providing developmental assistance to
prot[eacute]g[eacute]s. After careful consideration of the public
comments received on the notice of proposed rulemaking, USAID today
publishes a final rule.
II. Resolution of Comments
Fourteen comments were received in response to the proposed rule.
The comments and USAID's responses are as follows:
Comment: USAID's implementation of its Mentor-Prot[eacute]g[eacute]
Program must be narrowly tailored within SBA's statutory and regulatory
constraints, absent USAID-specific statutory authority.
Response: USAID agrees that its Mentor-Prot[eacute]g[eacute]
Program must stay within SBA regulations and USAID-specific statutory
authority.
USAID received two comments related to Minority Serving
Institutions in the proposed rule.
Comment 1 states: We support the inclusion of Minority Serving
Institutions (MSIs) as eligible prot[eacute]g[eacute]s but recommend
that the expanded description of MSIs in this (the Purpose) section be
deleted since it is specifically covered as a definition in section
719.273-2(b) and in FAR 2.101-2.
Comment 2 states: We support the inclusion of Minority Serving
Institutions (MSIs) as eligible mentors, but question USAID's authority
to use MSIs as small business concern prot[eacute]g[eacute]s.
Response: USAID intended to include MSIs in the scope of this
program. However, doing so would be outside its statutory authority.
USAID agrees that it does not currently have the statutory authority
for this provision and has deleted this requirement from the Mentor-
Prot[eacute]g[eacute] Program regulations. References to MSIs as
mentors or prot[eacute]g[eacute]s have been deleted from the final
rule.
USAID received two comments related to the treatment of
``affiliation'' in the proposed rule.
Comment 1 states: We appreciate the affirmation included in this
(Purpose) section that a prot[eacute]g[eacute] firm is not considered
an affiliate of a mentor solely because of the developmental assistance
the prot[eacute]g[eacute] receives under the Program but recommend that
this statement be moved to section 719.273-2(a) where it more
appropriately relates to the definition of a ``small business.''
Comment 2 states: We do not believe that [USAID] has the authority
to waive the SBA's affiliation requirements, as set forth in 13 CFR
121.103.
Response: USAID does not intend to establish affiliate
relationships or waive the SBA affiliation requirements, as doing so is
not within the USAID statutory authority. The final rule is clarified
in section 719.273-2.
Comment: We strongly support the formulation that a mentor may have
more than one prot[eacute]g[eacute] providing that each relationship
complies with the terms and conditions of the regulations and the
mentor can demonstrate that it has the capacity to provide
developmental assistance appropriate to the specific
prot[eacute]g[eacute]. However, this language is already more
appropriately addressed in sections 719.273-4(b) and 719.273-5(b) and
thus should be deleted from this [Purpose] section.
Response: USAID agrees with this comment and has modified the final
rule.
Comment: The commenter cites a portion of section 719.273-1 which
concludes with a statement that USAID reserves the right ``to limit the
total number of prot[eacute]g[eacute]s participating'' in the Program.
The Agency has not disclosed why it has an interest in establishing
limits on participation in the program. It is also unclear whether this
statement means that the Agency would limit the number of
prot[eacute]g[eacute]s a mentor could have or whether it is intended to
operate as an overall limit of the number of mentor firms in the
Program. For example, [Section] 719.273-5(b) states that USAID reserves
the right to limit the number of prot[eacute]g[eacute]s participating
under each mentor firm * * * By contrast, in the Paperwork Reduction
Act discussion in the Background section accompanying the rule the
Agency ``estimates'' that there would be a total of thirty firms
required to complete the application form. Regardless, we believe the
issue of any Agency imposed limits, if there are to be any, is more
appropriately addressed elsewhere in the substantive provisions of the
rule.
Response: The commenter addresses several attributes of the
Program, some of which are clarified in the final rule. USAID confirms
its intent to reserve the right to limit the total number of
participants in the Program, as expressed in section 719.273-4, in
order to insure its effective management of the Program. The
formulation in section 719.273-5(b) is clear in its intent to reserve
the right to limit the number of prot[eacute]g[eacute]s participating
under each mentor under the Program, in order for USAID to effectively
manage the Program, to conduct due diligence on all Mentor-
Prot[eacute]g[eacute] Agreements, and to assure the developmental
assistance proposed in the Agreements is being provided by the mentor
to the prot[eacute]g[eacute](s). The discussion on the Paperwork
Reduction Act in the Background section is intended to
[[Page 32542]]
provide an estimate of the number of participants from the U.S.
business community to participate in the Program and was not intended
to set a predetermined limit on the number of participants in the
Program. USAID will monitor the number of Agreements endorsed
(participants accepted into the Program) and in effect between the
firms within a given period of time. These Agreements will be entered
by firms in the public domain outside the controls of the USAID, but
USAID imposes these measures to potentially limit participation in the
Program to assure the integrity of the Mentor-Prot[eacute]g[eacute]
Program. USAID agrees to reflect this concern in the Internal Controls
section 719.273-10(a)(4) of the final rule.
Comment: Addressing the definitions in section 719.273-2, commenter
noted that the categories of firms eligible to participate in the
Program are already covered in a more inclusive manner as a defined
term in paragraph (a) of this Section and recommended deleting the
listing in paragraph (e).
Response: USAID disagrees with this comment and believes that there
is merit in listing the categories of small business firms in both the
new introductory paragraph of the section and in the specific
definition of a Prot[eacute]g[eacute].
Comment: (Referring to the last sentence of undesignated first
paragraph of section 719.273-4) We recognize that the goal of the
Mentor-Prot[eacute]g[eacute] Program is to expand the opportunities for
small businesses to participate in USAID procurements. However, based
on the capabilities of the prospective prot[eacute]g[eacute] firm and
the developmental assistance it may need, it may be unreasonable to
expect a prospective mentor firm to include the prospective
prot[eacute]g[eacute] in the subcontracts at the outset of an
Agreement. We believe USAID intended the scope of opportunities for
prospective firms to be as broad as possible and that the Agency did
not intend to restrict prospective prot[eacute]g[eacute]s to only those
firms that are already qualified as potential prime contractors or as
subcontractors under a mentor's prime contract * * *. We encourage
USAID to clarify this important issue of eligibility in this paragraph.
Response: USAID does not expect nor will it require a prospective
mentor firm to include the prospective prot[eacute]g[eacute] in the
subcontracts at the onset of an Agreement. USAID has clarified this
issue of eligibility in the final rule.
Comment: The commenter, citing the Federal Acquisition Regulation,
states that USAID relies on 15 U.S.C. 637(d)(4)(E) for its authority to
provide appropriate incentives to encourage subcontracting
opportunities for small business consistent with the efficient and
economical performance of the contract * * * [A]lthough USAID could
provide certain evaluation preferences to mentors and
prot[eacute]g[eacute]s with an approved Agreement, [commenter did] not
see how USAID can provide the subcontracting credit that is set forth
in the proposed rule, noting that the Department of Defense needed
specific statutory authority for their Mentor-Prot[eacute]g[eacute]
Program to provide for subcontracting credits.
Response: USAID agrees that it currently does not have statutory
authority to permit credit for subcontracting and has modified the
final rule accordingly, to refine the language in 719.273-3(b). We are
concerned about making the Program attractive to mentors and
prot[eacute]g[eacute]s through allowable incentives under its statutory
authority. After reviewing incentives offered by other U.S. Government
agencies and as permitted by our regulations, we revised this section,
using the Environmental Protection Agency (EPA) program as a model.
Under the same Small Business Act authority cited above, EPA has
provided certain ``incentives'' for mentors, as codified in 48 CFR
1552.219-71(j); their regulation states that costs incurred by the
offeror in fulfilling their agreement with a prot[eacute]g[eacute] firm
are not reimbursable as a direct cost under the contract, but if EPA is
the responsible audit agency, these costs will be considered in
determining indirect cost rates. In the final rule, USAID's
``incentive'' is similar to one provided by EPA.
Comment: When referencing a term such as ``small business,''
HUBZone, etc., USAID should be referring the reader to SBA's
regulations rather than the FAR. The term as used in USAID's regulation
should also be consistent with the term as defined in 13 CFR.
Response: USAID has modified the final rule accordingly.
We received two comments on section 719.273-4(b)(1)(ii). The first
commenter noted that the section provides that the applicable NAICS
code for determining small business status is the services or supplies
to be provided by the Prot[eacute]g[eacute] to the mentor, but that
``the January 2006 application form prescribes that small business
eligibility is based on the primary NAICS code for the small business
concern. These two differing standards must be reconciled. We support
the formulation used in the rule.'' The second commenter asked that
USAID clarify that the prot[eacute]g[eacute] must be small for the
NAICS codes assigned to the subcontract by the prime contractor (13 CFR
121.405).
Response: In the final rule, USAID indicates that the
prot[eacute]g[eacute] must be small for the NAICS codes designated by
the mentor, based on the supplies or services the prot[eacute]g[eacute]
may provide to the mentor under a subcontract, in cases where there is
a subcontract. USAID is not limiting prot[eacute]g[eacute] eligibility
to only those small businesses that have a subcontract with the mentor,
so we do not want the final rule to appear to make such a limitation.
The comment about the application form is outside the scope of the
proposed and this final rule.
Comment: The Summary of the proposed rule is not in agreement with
the language in the proposed regulation and may be misleading.
Response: USAID agrees and has modified the rule to harmonize the
summary and the language of the regulation.
Comment: The clause reference 752.219-270 should be 752.219-70.
Response: USAID agrees and deleted the number ``2'' from clause
reference 752.219-70.
Comment: In section 719.273-4 Eligibility of Mentor and
Prot[eacute]g[eacute] Firms (b)(2), please clarify that the applicable
certifications must be in accordance with SBA's Program regulations
contained in 13 CFR 124 and 126.
Response: USAID agrees and has modified the final rule accordingly.
III. Procedural Requirements
A. Review Under Executive Order 12866
Today's regulatory action has been determined to be a ``significant
regulatory action'' under Executive Order 12866, ``Regulatory Planning
and Review'' (58 FR 51735, October 4, 1993). Accordingly, this final
rule was subject to review under that Executive Order by the Office of
Information and Regulatory Affairs of the Office of Management and
Budget (OMB).
B. Review Under Executive Order 12988
With respect to the review of existing regulations and the
promulgation of new regulations, section 3(a) of Executive Order 12988,
``Civil Justice Reform,'' 61 FR 4729 (February 7, 1996), imposes on
Executive agencies the general duty to adhere to the following
requirements: (1) Eliminate drafting errors and ambiguity; (2) Write
regulations to minimize litigation; and (3) Provide a clear legal
standard for affected conduct rather than a general standard and
promote simplification and burden reduction. With regard to the review
required by section 3(a),
[[Page 32543]]
section 3(b) of Executive Order 12988 specifically requires that
Executive agencies make every reasonable effort to ensure that the
regulation: (1) Clearly specifies the subject law's preemptive effect,
if any; (2) Clearly specifies any effect on existing Federal law or
regulation; (3) Provides a clear legal standard for affected conduct
while promoting simplification and burden reduction; (4) Specifies the
retroactive effect, if any; (5) Adequately defines key terms; and (6)
Addresses other important issues affecting clarity and general
draftsmanship under any guidelines issued by the Attorney General.
Section 3(c) of Executive Order 12988 requires Executive agencies to
review regulations in light of applicable standards in section 3(a) and
section 3(b) to determine whether they are met or it is unreasonable to
meet one or more of them. USAID has completed the required review and
determined that these proposed regulations meet the relevant standards
of Executive Order 12988.
C. Review Under the Regulatory Flexibility Act
This final rule has been reviewed under the Regulatory Flexibility
Act of 1980, Public Law 96-354, that requires preparation of an initial
regulatory flexibility analysis for any rule that must be proposed for
public comment and that is likely to have significant economic impact
on a substantial number of small entities. Small entities include small
business, small organizations, and small governmental jurisdictions.
For purposes of assessing the impact of today's rule on small
entities, small entity is defined as: (1) A small business that meets
the definition of a small business found in the Small Business Act and
codified in 13 CFR 121.201; (2) a small governmental jurisdiction that
is a government of a city, county, town school district or special
district with a population of less than 50,000; or (3) a small
organization that is any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field.
After considering the economic impacts of today's rule on small
entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. In
determining whether a rule has a significant economic impact on a
substantial number of entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the proposed rule on small entities.'' (5 U.S.C. 603
and 604) Thus, an agency may certify that a rule will not have a
significant economic impact on a substantial number of small entities
if the rule relieves regulatory burden, or otherwise has a positive
economic effect on all of the small entities subject to the rule. In
fact, the purpose of the USAID Mentor-Prot[eacute]g[eacute] Program is
to increase small business accessibility to USAID contracting. This
rule streamlines USAID internal operating procedures and will therefore
not have a significant economic impact on small entities.
D. Review Under the Paperwork Reduction Act
This rule requires USAID Mentor-Prot[eacute]g[eacute] Program
participants to submit an application (see section 719.273-7) and
annual progress reports to the USAID Mentor-Prot[eacute]g[eacute]
Program Manager at USAID Headquarters (see section 719.273-10). The
information in the reports is necessary to determine the value of the
developmental assistance and if the schedules and developmental
assistance levels contained in Mentor-Prot[eacute]g[eacute] Agreements
are being met. Performance under the Agreements is the basis for
providing proper recognition to Mentor firms. USAID submitted the
proposed collection of information to the Office of Management and
Budget for review and approval under the Paperwork Reduction Act, 44
U.S.C. 3501, et seq. The Office of Management and Budget has not yet
approved the collection of information in this rule.
An agency may not conduct or sponsor and a person is not required
to respond to a collection of information unless it displays a
currently valid OMB control number (5 CFR 1320.5(b)).
E. Review Under Executive Order 12612
Executive Order 12612, (52 FR 41685, October 30, 1987), requires
that regulations, rules, legislation, and any other policy actions be
reviewed for any substantial direct effects on States, on the
relationship between the Federal Government and the States, or in the
distribution of power and responsibilities among the various levels of
Government. If there are sufficient substantial direct effects, then
the Executive Order requires the preparation of a federalism assessment
to be used in all decisions involved in promulgating and implementing a
policy action. States would not be directly subject to this rule, since
they are not among the class of entities described as Mentors or
Prot[eacute]g[eacute]s. USAID has determined that this rule would not
have a substantial direct effect on the institutional interests or
traditional functions of the States.
F. Review Under the Unfunded Mandates Reform Act of 1995
The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) generally
requires a Federal agency to perform a detailed assessment of costs and
benefits of any rule imposing a federal mandate with costs to State,
local or tribal governments, or to the private sector of $100 million
or more. This rulemaking would only affect private sector entities, and
the impact is less than $100 million.
List of Subjects in 48 CFR Part 719
Government procurement.
0
For the reasons set out in the preamble, USAID amends 48 CFR Chapter 7
as set forth below:
PART 719--SMALL BUSINESS PROGRAMS
0
1. The authority citation for part 719 is revised to read as follows:
Authority: 42 U.S.C. 7254, 40 U.S.C. 486(c), 42 U.S.C. 2201.
0
2. A new subpart 719.273 is added as follows:
Subpart 719.273--The U.S. Agency for International Development
(USAID) Mentor-Prot[eacute]g[eacute] Program
Sec.
719.273 The U.S. Agency for International Development Mentor-
Prot[eacute]g[eacute] Program.
719.273-1 Purpose.
719.273-2 Definitions.
719.273-3 Incentives for Prime Contractor Participation.
719.273-4 Eligibility of Mentor and Prot[eacute]g[eacute] Firms.
719.273-5 Selection of Prot[eacute]g[eacute] Firms.
719.273-6 Application Process.
719.273-7 OSDBU Review of Application.
719.273-8 Developmental Assistance.
719.273-9 Obligations Under the Mentor-Prot[eacute]g[eacute]
Program.
719.273-10 Internal Controls.
719.273-11 Solicitation Provision and Contract Clause.
719.273 The United States Agency for International Development (USAID)
Mentor-Prot[eacute]g[eacute] Program.
719.273-1 Purpose.
The USAID Mentor-Prot[eacute]g[eacute] Program is designed to
assist small business, including veteran-owned small business, service-
disabled veteran-owned small business, HUBZone, small socially and
economically disadvantaged business, and women-owned small business in
enhancing their capabilities to perform contracts
[[Page 32544]]
and sub-contracts for USAID and other Federal agencies. The Mentor-
Prot[eacute]g[eacute] Program is also designed to improve the
performance of USAID contractors and subcontractors by providing
developmental assistance to Prot[eacute]g[eacute] entities, fostering
the establishment of long-term business relationships between small
business and prime contractors, and increasing the overall number of
small business that receive USAID contract and subcontract awards. A
firm's status as a Prot[eacute]g[eacute] under a USAID contract shall
not have an effect on the firm's eligibility to seek other prime
contracts or subcontracts.
719.273-2 Definitions.
Throughout, the term ``small business'' includes all categories of
small firms as defined by the Small Business Administration (SBA) on
whose behalf the Office of Small and Disadvantaged Business Utilization
(OSDBU) is chartered to advocate, including small business, small
disadvantaged business, women-owned small business, veteran-owned and
service-disabled veteran-owned small business and small business
located in HUBZones, as those terms are defined in 13 CFR part 124. The
determination of affiliation is a function of the SBA.
(a) A ``Mentor'' is a prime contractor that elects to promote and
develop small business subcontractors by providing developmental
assistance designed to enhance the business success of the
Prot[eacute]g[eacute].
(b) ``Program'' refers to the USAID Mentor-Prot[eacute]g[eacute]
Program as described in this Chapter.
(c) ``Prot[eacute]g[eacute]'' means a small business, small
disadvantaged business, women-owned small business, HUBZone small
business, veteran-owned small business or service-disabled veteran
owned small business that is the recipient of developmental assistance
pursuant to a Mentor-Prot[eacute]g[eacute] Agreement.
719.273-3 Incentives for Prime Contractor Participation.
(a) Under the Small Business Act, 15 U.S.C. 637(d)(4)(E), USAID is
authorized to provide appropriate incentives to encourage
subcontracting opportunities for small business consistent with the
efficient and economical performance of the contract. This authority is
limited to negotiated procurements. FAR 19.202-1 provides additional
guidance.
(b) Costs incurred by a Mentor to provide developmental assistance,
as described in 719.273-8 to fulfill the terms of their agreement(s)
with a Prot[eacute]g[eacute] firm(s), are not reimbursable as a direct
cost under a USAID contract. If USAID is the mentor's responsible audit
agency under FAR 42.703-1, USAID will consider these costs in
determining indirect cost rates. If USAID is not the responsible audit
agency, mentors are encouraged to enter into an advance agreement with
their responsible audit agency on the treatment of such costs when
determining indirect cost rates.
(c) In addition to subparagraph (b) above, contracting officers may
give Mentors evaluation credit under FAR 15.101-1 considerations for
subcontracts awarded pursuant to their Mentor-Prot[eacute]g[eacute]
Agreements and their subcontracting plans. Therefore:
(1) Contracting officers may evaluate subcontracting plans
containing Mentor-Prot[eacute]g[eacute] arrangements more favorably
than subcontracting plans without Mentor-Prot[eacute]g[eacute]
Agreements.
(2) Contracting officers may assess the prime contractor's
compliance with the subcontracting plans submitted in previous
contracts as a factor in evaluating past performance under FAR
15.305(a)(2)(v) and determining contractor responsibility 19.705-
5(a)(1).
(d) OSDBU Mentoring Award. A non-monetary award will be presented
annually to the Mentoring firm providing the most effective
developmental support of a Prot[eacute]g[eacute]. The Mentor-
Prot[eacute]g[eacute] Program Manager will recommend an award winner to
the Director of the Office of Small and Disadvantaged Business
Utilization (OSDBU).
(e) OSDBU Mentor-Prot[eacute]g[eacute] Annual Conference. At the
conclusion of each year in the Mentor-Prot[eacute]g[eacute] Program,
Mentor firms will be invited to brief contracting officers, program
leaders, office directors and other guests on Program progress.
719.273-4 Eligibility of Mentor and Prot[eacute]g[eacute] Firms.
Eligible business entities approved as Mentors may enter into
agreements (hereafter referred to as ``Mentor-Prot[eacute]g[eacute]
Agreement'' or ``Agreement'' and explained in section 719.273-6) with
eligible Prot[eacute]g[eacute]s. Mentors provide appropriate
developmental assistance to enhance the capabilities of
Prot[eacute]g[eacute]s to perform as contractors and/or subcontractors.
Eligible small business entities capable of providing developmental
assistance may be approved as Mentors. Prot[eacute]g[eacute]s may
participate in the Program in pursuit of a prime contract or as
subcontractors under the Mentor's prime contract with the USAID, but
are not required to be a subcontractor to a USAID prime contractor or
be a USAID prime contractor. Notwithstanding eligibility requirements
in this section, USAID reserves the right to limit the number of
participants in the Program in order to insure its effective management
of the Mentor-Prot[eacute]g[eacute] Program.
(a) Eligibility. A Mentor:
(1) May be either a large or small business entity;
(2) Must be eligible for award of Government contracts;
(3) Must be able to provide developmental assistance that will
enhance the ability of Prot[eacute]g[eacute]s to perform as prime
contractors or subcontractors; and
(4) Will be encouraged to enter into arrangements with entities
with which it has established business relationships.
(b) Eligibility. A Prot[eacute]g[eacute]:
(1) Must be a small business, veteran-owned small business,
service-disabled veteran-owned small business, HUBZone, small socially
and economically disadvantaged business, and women-owned small
business);
(2) Must meet the size standard corresponding to the NAICS code
that the Mentor prime contractor believes best describes the product or
service being acquired by the subcontract; and
(3) Eligible for award of government contracts.
(c) Prot[eacute]g[eacute]s may have multiple Mentors.
Prot[eacute]g[eacute]s participating in Mentor-Prot[eacute]g[eacute]
programs in addition to USAID's Program should maintain a system for
preparing separate reports of Mentoring activity so that results of the
USAID Program can be reported separately from any other agency program.
(d) A Prot[eacute]g[eacute] firm shall self-certify to a Mentor
firm that it meets the requirements set forth in paragraph (b) of this
section and possess related certifications granted by the Small
Business Administration (e.g., HUBZone, 8(a), etc.). Mentors may rely
in good faith on written representations by potential
Prot[eacute]g[eacute]s that they meet the specified eligibility
requirements. HUBZone and small disadvantaged business status
eligibility and documentation requirements are determined according to
13 CFR part 124.
719.273-5 Selection of Prot[eacute]g[eacute] Firms.
(a) Mentor firms will be solely responsible for selecting
Prot[eacute]g[eacute] firms. Mentors are encouraged to select from a
broad base of small business including small disadvantaged business,
women-owned small business, veteran-owned small business, service-
disabled veteran-owned small business, and HUBZone firms whose core
competencies support USAID's mission.
(b) Mentors may have multiple Prot[eacute]g[eacute]s. However, to
preserve the
[[Page 32545]]
integrity of the Program and assure the quality of developmental
assistance provided to Prot[eacute]g[eacute]s, USAID reserves the right
to limit the total number of Prot[eacute]g[eacute]s participating under
each Mentor firm for the Mentor-Prot[eacute]g[eacute] Program.
(c) The selection of Prot[eacute]g[eacute] firms by Mentor firms
may not be protested, except that any protest regarding the size or
eligibility status of an entity selected by a Mentor shall be handled
in accordance with the Federal Acquisition Regulation (FAR) and the
Small Business Administration regulations.
719.273-6 Application Process.
Entities interested in becoming a Mentor firm must apply in writing
to the USAID Office of Small and Disadvantaged Business Utilization
(OSDBU) by submitting form AID 321-1 (OMB Control number 0412-0574
approved on 5/22/2007). The application shall contain the Mentor-
Prot[eacute]g[eacute] Agreement and shall be evaluated for approval.
Evaluations will consider the nature and extent of technical and
managerial support as well as any proposed financial assistance in the
form of equity investment, loans, joint-venture, and traditional
subcontracting support. The Mentor-Prot[eacute]g[eacute] Agreement must
contain:
(a) Names, addresses, phone numbers, and e-mail addresses (if
available) of Mentor and Prot[eacute]g[eacute] firm(s) and a point of
contact for both Mentor and Prot[eacute]g[eacute];
(b) A description of the developmental assistance that will be
provided by the Mentor to the Prot[eacute]g[eacute], including a
description of the work or product contracted for (if any), a schedule
for providing assistance, and criteria for evaluation of the
Prot[eacute]g[eacute]'s developmental success;
(c) A listing of the number and types of subcontracts to be awarded
to the Prot[eacute]g[eacute];
(d) Duration of the Agreement, including rights and
responsibilities of both parties (Mentor and Prot[eacute]g[eacute]);
(e) Termination procedures, including procedures for the parties'
voluntary withdrawal from the Program. The Agreement shall require the
Mentor or the Prot[eacute]g[eacute] to notify the other firm in writing
at least 30 days in advance of its intent to voluntarily terminate the
Agreement;
(f) Procedures requiring the parties to notify OSDBU immediately
upon receipt of termination notice from the other party;
(g) A plan for accomplishing the work or product contracted for
should the Agreement be terminated; and
(h) Other terms and conditions, as appropriate.
719.273-7 OSDBU Review of Application.
(a) OSDBU will review the information to establish the Mentor and
Prot[eacute]g[eacute] eligibility and to ensure that the information
that is in section 719.273-6 is included. If the application relates to
a specific contract, then OSDBU will consult with the responsible
contracting officer on the adequacy of the proposed Agreement, as
appropriate. OSDBU will complete its review no later than 30 calendar
days after receipt of the application or after consultation with the
contracting officer, whichever is later. Application for and enrollment
into the Program are free and open to the public.
(b) After OSDBU completes its review and provides written approval,
the Mentor may execute the Agreement and implement the developmental
assistance as provided under the Agreement. OSDBU will provide a copy
of the Mentor-Prot[eacute]g[eacute] Agreement to the USAID contracting
officer for any USAID contracts affected by the Agreement.
(c) The Agreement defines the relationship between the Mentor and
Prot[eacute]g[eacute] firms only. The Agreement itself does not create
any privity of contract or contractual relationship between the Mentor
and USAID nor the Prot[eacute]g[eacute] and USAID.
(d) If the application is disapproved, the Mentor may provide
additional information for reconsideration. OSDBU will complete review
of any supplemental material no later than 30 days after its receipt.
Upon finding deficiencies that USAID considers correctable, OSDBU will
notify the Mentor and Prot[eacute]g[eacute] and request correction of
deficiencies to be provided within 15 days.
719.273-8 Developmental Assistance.
The forms of developmental assistance a Mentor can provide to a
Prot[eacute]g[eacute] include and are not limited to the following:
(a) Guidance relating to--
(1) Financial management;
(2) Organizational management;
(3) Overall business management/planning;
(4) Business development; and
(5) Technical assistance.
(b) Loans;
(c) Rent-free use of facilities and/or equipment;
(d) Property;
(e) Temporary assignment of personnel to a Prot[eacute]g[eacute]
for training; and
(f) Any other types of permissible, mutually beneficial assistance.
719.273-9 Obligations Under the Mentor-Prot[eacute]g[eacute] Program.
(a) A Mentor or Prot[eacute]g[eacute] may voluntarily withdraw from
the Program. However, in no event shall such withdrawal impact the
contractual requirements under any prime contract.
(b) Mentor and Prot[eacute]g[eacute] entities shall submit to the
USAID Office of Small and Disadvantaged Business Utilization (OSDBU)
annual reports on progress under the Mentor-Prot[eacute]g[eacute]
Agreement. USAID will evaluate annual reports by considering the
following:
(1) Specific actions taken by the Mentor during the evaluation
period to increase the participation of their Prot[eacute]g[eacute](s)
as suppliers to the Federal Government and to commercial entities;
(2) Specific actions taken by the Mentor during the evaluation
period to develop technical and administrative expertise of a
Prot[eacute]g[eacute] as defined in the Agreement;
(3) The extent to which the Prot[eacute]g[eacute] has met the
developmental objectives in the Agreement;
(4) The extent to which the Mentor's participation in the Mentor-
Prot[eacute]g[eacute] Program impacted the Prot[eacute]g[eacute]'(s)
ability to receive contract(s) and subcontract(s) from private firms
and Federal agencies other than USAID; and, if deemed necessary;
(5) Input from the Prot[eacute]g[eacute] on the nature of the
developmental assistance provided by the Mentor.
(c) OSDBU will submit annual reports to the relevant contracting
officer regarding participating prime contractor(s)' performance in the
Program.
(d) Mentor and Prot[eacute]g[eacute] firms shall submit an
evaluation to OSDBU at the conclusion of the mutually agreed upon
Program period, the conclusion of the contract, or the voluntary
withdrawal by either party from the Program, whichever comes first.
719.273-10 Internal Controls.
(a) OSDBU will oversee the Program and will work in concert with
the Mentor-Prot[eacute]g[eacute] Program Manager and relevant
contracting officers to achieve Program objectives. OSDBU will
establish internal controls as checks and balances applicable to the
Program. These controls will include:
(1) Reviewing and evaluating Mentor applications for validity of
the provided information;
(2) Reviewing annual progress reports submitted by Mentors and
Prot[eacute]g[eacute]s on Prot[eacute]g[eacute] development to measure
Prot[eacute]g[eacute] progress against the plan submitted in the
approved Agreement;
(3) Reviewing and evaluating financial reports and invoices
submitted
[[Page 32546]]
by the Mentor to verify that USAID is not charged by the Mentor for
providing developmental assistance to the Prot[eacute]g[eacute]; and
(4) Limiting the number of participants in the Mentor-
Prot[eacute]g[eacute] Program within a reporting period, in order to
insure the effective management of the Program.
(b) USAID may rescind approval of an existing Mentor-
Prot[eacute]g[eacute] Agreement if it determines that such action is in
USAID's best interest. The rescission shall be in writing and sent to
the Mentor and Prot[eacute]g[eacute] after approval by the Director of
OSDBU. Rescission of an Agreement does not change the terms of any
subcontract between the Mentor and the Prot[eacute]g[eacute].
719.273-11 Solicitation Provision and Contract Clause.
(a) The Contracting Officer shall insert the provision at AIDAR
752.219-70 in all unrestricted solicitations exceeding $550,000
($1,000,000 for construction) that offer subcontracting opportunities.
(b) The Contracting Officer shall insert the clause at AIDAR
752.219-71 in all contracts where the prime contractor has signed a
Mentor-Prot[eacute]g[eacute] Agreement with USAID.
PART 752--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
3. Add section 752.219-70 to read as follows:
752.219-70 USAID Mentor-Prot[eacute]g[eacute] Program.
As prescribed in 719.273-11(a), insert the following provision:
USAID Mentor-Prot[eacute]g[eacute] Program (July 13, 2007)
(a) Large and small business are encouraged to participate in
the USAID Mentor-Prot[eacute]g[eacute] Program (the ``Program'').
Mentor firms provide eligible small business Prot[eacute]g[eacute]s
with developmental assistance to enhance their business capabilities
and ability to obtain Federal contracts.
(b) Mentor firms are large prime contractors or eligible small
business capable of providing developmental assistance.
Prot[eacute]g[eacute] firms are small business as defined in 13 CFR
parts 121, 124, and 126.
(c) Developmental assistance is technical, managerial,
financial, and other mutually beneficial assistance that aids
Prot[eacute]g[eacute]s. The costs for developmental assistance are
not chargeable to the contract.
(d) Firms interested in participating in the Program are
encouraged to contact the USAID Mentor-Prot[eacute]g[eacute] Program
Manager (202-712-1500) for more information.
(End of provision)
0
4. Add section 752.219-271 to read as follows:
752.219-71 Mentor Requirements and Evaluation.
As prescribed in AIDAR 719.273-11(b), insert the following clause:
Mentor Requirements and Evaluation (July 13, 2007)
(a) Mentor and Prot[eacute]g[eacute] firms shall submit an
evaluation of the overall experience in the Program to OSDBU at the
conclusion of the mutually agreed upon Program period, the
conclusion of the contract, or the voluntary withdrawal by either
party from the Program, whichever occurs first. At the conclusion of
each year in the Mentor-Prot[eacute]g[eacute] Program, the Mentor
and Prot[eacute]g[eacute] will formally brief the USAID Mentor-
Prot[eacute]g[eacute] Program Manager regarding Program
accomplishments under their Mentor-Prot[eacute]g[eacute] Agreement.
(b) Mentor or Prot[eacute]g[eacute] shall notify OSDBU in
writing, at least 30 calendar days in advance of the effective date
of the firm's withdrawal from the Program.
(End of clause)
Dated: May 31, 2007.
Robert K. Egge,
Acting Director, Office of Small and Disadvantaged Business Utilization
(OSDBU).
[FR Doc. E7-11093 Filed 6-11-07; 8:45 am]
BILLING CODE 6116-01-P