Did you know that 85 percent of USAID’s development work around the world is implemented through grants, cooperative agreements, and contracts? 

USAID uses these mechanisms, also known as acquisition and assistance (A&A) mechanisms, to provide funding to partners to implement development programs. Acquisition is when USAID buys goods or services for its own purposes. Assistance is when it provides a grant or cooperative agreement award to an organization to further development and humanitarian assistance goals.

Because USAID uses A&A to support partner countries in achieving their development objectives, the Agency’s A&A Strategy is a critically important document. USAID recently updated its A&A Strategy – but what does that mean for its Missions and partners around the world? And what’s new in USAID’s new A&A Strategy update?

1. Empowering Local Staff to Lead Local Partnerships

Localization starts with enabling, equipping, and empowering USAID staff in its A&A workforce to collaborate with local partners. USAID has long relied on its locally employed Cooperating Country Nationals / Foreign Service Nationals (CCN/FSNs) for institutional knowledge, A&A expertise, and understanding of the local context. In 2022, the CCN/FSN representatives formed a Management Council to elevate the needs and priorities of local A&A Specialists and ensure that their expertise is represented in decision-making. 

Through the advocacy of the CCN/FSN Management Council and other groups, USAID is expanding leadership opportunities for CCN/FSN A&A Specialists. For example, USAID will double the number of CCN/FSN A&A Specialists with warrants by the end of FY 2023. A warrant authorizes CCN/FSN A&A Specialists to independently manage A&A actions and build relationships with local implementing partners, helping them step into a key leadership role in the Agency’s localization initiative. USAID also is seeking ways to hire CCN/FSN A&A Specialists at higher levels when they take on warrants, ensuring that their compensation accurately reflects their expertise and value-add to the Agency. 

"The Agency is taking the necessary steps to empower the CCN/FSNs to provide the local staff with the necessary skills and authority to carry out our jobs effectively and efficiently.” ~Fabiola Loy, A&A Specialist, USAID/Guatemala

Fabiola Loy, a warranted A&A Specialist from USAID/Guatemala, stressed the importance of the Management Council: “Through the CCN/FSN Management Council, we now have a direct channel of communication between the A&A CCN/FSN community and the OAA [Office of Acquisition and Assistance]/Washington front office in which we can share the field perspective and together find solutions for our day-to-day challenges.”

2. Using WorkwithUSAID.org to Facilitate Sub-Opportunities

While there are many ways that organizations can forge a direct partnership with USAID, there are also indirect ways for organizations to become involved with USAID projects. Subawards and subcontracts are effective ways for new partners to access USAID funding while gaining experience and learning the rules and regulations of USAID awards. 

As USAID looks to expand who it partners with and increase access to USAID for local organizations, the Agency wants to raise the visibility of sub-opportunities. To do this, USAID recently launched a Sub-Opportunity portal that lists subaward and subcontract opportunities on WorkwithUSAID.org. The site provides a searchable platform for subawards and subcontracts being offered by primes, increasing the visibility of these opportunities to all potential subrecipient and subcontractors, including new, nontraditional, and local organizations. The new page offers prime partners a central platform to be able to reach potential subrecipients and subcontractors outside of their immediate networks. Not only does this make these opportunities visible and accessible to a broader pool of organizations, but it also expands prime partners’ ability to make connections with new organizations that can add value to USAID-funded projects.

3. Increasing and Improving the Use of Pay-for-Results and Other Simple A&A Mechanisms

One award mechanism that has allowed USAID to focus on results, partner with organizations of all types, and reduce compliance burdens is the pay-for-results award. With pay-for-results awards, such as fixed amount awards and firm-fixed-price contracts, partners and USAID co-create milestones, and the partner is paid upon achievement of these milestones, incentivizing innovation and solutions identified by the partner, rather than those prescribed by USAID. Additionally, pay-for-results awards have fewer pre-award requirements and lower compliance burdens during implementation, making them an excellent fit for partners that are new to USAID.  

USAID increased its use of fixed amount awards from $97 million in FY 2021 to $141 million in FY 2022. 

The Agency plans to continue to accelerate its use of pay-for-results awards by making the number of pay-for-results awards one of the publicly reported metrics of the A&A Strategy implementation. USAID also will increase the capacity of staff to design and manage pay-for-results awards, such as making sure milestones are appropriate and providing the partner with the resources needed up front for successful implementation. 

4. Working with Partners in Local Languages

Integrating localization throughout the A&A process means collaborating with partners in local languages, rather than requiring them to adjust to USAID’s business model. To do this, USAID is mainstreaming the submission of brief concept notes in local languages as a first step in the application process, allowing concepts to be evaluated based on technical merit, not English fluency. Despite this important step, a barrier remains in the “last mile” of the partnership process, as partners are legally required to submit full applications to USAID in English. Missions are piloting various approaches to tackle this challenge, such as finding solutions to translate full applications from local languages to English for their partners. 

USAID/Nepal has been a forerunner in the process of institutionalizing their approach to translation. The Mission envisions providing the holistic support needed for localization, such as developing Nepali language resources for prospective partners, translating award materials submitted in Nepali to English, as well as helping partners prepare for USAID award requirements. This is an important step toward the Mission’s goal of providing 40 percent of their total funding to local partners. According to USAID/Nepal Contracting Officer Maria Televantos, “USAID/Nepal is committed to putting local actors in the lead role for Nepal’s development. In order to do that, we will need to work more in Nepali and other local languages, and our USAID Localization Support mechanism will play a key role in our ability to do that.”

Contribute to the A&A Strategy implementation plan! The implementation plan is a living document, and we are currently seeking feedback from the partner community. Please email industryliaison@usaid.gov with your comments on the A&A Strategy implementation plan. You can find other resources on the A&A Strategy here.