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BestPracticesinWorkingwithLocalNGOsGrantNo.621G00100001300

PreparedforUSAID/Tanzania

By

MichaelF.Walsh

InsideNGO

March,2010

ThisstudyismadepossiblebythegeneroussupportoftheAmericanpeople

throughtheUnitedStatesAgencyforInternationalDevelopment(USAID).The

contentsare

the

responsibility

of

InsideNGO

and

do

not

necessarily

reflect

the

viewsofUSAIDortheUnitedStatesGovernment.

UtafitihuuimefanikiwakwamsaadawawatuwaMarekanikupitiashirikala

misaadalaMarekani(USAID).InsideNGOatawajibikanamatokeoyakazihii.

TaarifahiinimaoniyamtayarishajinasilazimayawakilishemaoniyaUSAIDau

SerikaliyaMarekani.

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Introduction

OnJanuary5,2010,USAID/TanzaniaawardedGrantNo.621G00100001300

toInsideNGOtocontributetotheMissionsprogramentitledBestPracticesin

WorkingwithLocalNGOs.CarriedoutbetweenJanuary6,2010andFebruary

5,2010,thegrantcalledfortheexaminationoftheapproachofthreeofthe

MissionsprimerecipientsAfricanMedicalandResearchFoundation

(AMREF),ElizabethGlaserPediatricAIDSFoundation(EGPAF),andPact

Tanzania thatmakesubawardsintheareaofHIV/AIDS.Mr.MichaelWalsh,

DirectorofProgramsforFinance,GrantsandContractsatInsideNGO,carried

outgrantrequirementsthroughacombinationofmaterialsreview;discussions

withtheheadquartersstaffofthethreerecipients;incountrydiscussionswith

USAID/Tanzania;andindepthinterviews,discussionsandRoundtableswith

thethreepartnersfieldofficestaff(inTanzania)andarangeofstakeholders;and

exitbriefingswiththemaswellaswithUSAID.Mr.WalshsfieldworkwasconductedJanuary25toFebruary5,2010.

Mr.WalshextendssincerethankstoUSAID,theirthreepartnerorganizations,

andallthoseinvolvedwithandinterviewedforthiseffortfortheircommitment

oftimeandtheirsupportandsharingofexperiencesthatleadtothisreportand

thefollowingkeyfindingsandrecommendations:

I.Programming/DesignIssues

1. DevelopbenchmarksleadingtomorecapableDistricts&Councils2. Managecashflowinterruptionswithmoreinformation3. Extendcommitmentbeyondannualprogramcycles4. DefinebenchmarksleadingtomorecapablelocalNGOs

II.Negotiation/Award

1. Investinoperationalsupporttoeffectivelymanagerisk2. Includecapacitybuildingconsiderationsinbestvalueaward

determinations

3. SettoneofcollaborationwithbroaderpartnercommunityIII.Implementation

1. Streamlineanddelegateadministrativeapprovals2. Harmonizereportingrequirements

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3. Conductauditsorreviewsregularlyratherthanattheendoftheactivity4. Mentoringbyprimesofsubrecipientsisessential5. Supportcoordination/collaborationamongprimesandlocalNGOs6. Trainingisacontinuousneed,butitrequiresatrainingstrategyand

alternativemodels

7. PlanforcloseoutandgraduationfromthebeginningandhighlightinthesubawardsandMOUswithLGAs.

Purpose

ThepurposeofthisstudywastoidentifyapproachesinwhichUSAID,prime

recipientsandtheirsubrecipientrelationships,strategiesandtacticscansupport

thegrowthandstrengtheningoflocalinstitutions. Thelessonslearnedandbest

practicesidentifiedwillsupportUSAID/TanzaniasHumanandInstitutional

CapacityDevelopment(HICD)activityundertheUSPresidentsEmergencyPlanforAIDSRelief(PEPFAR)program. Inadditiontorecommendationson

howUSAID/Tanzaniacanrefineitscurrentandfutureawardstofacilitate

capacitybuildingoflocalnongovernmentalorganizations(NGOs),thestudy

alsoconsidershowLocalGovernmentAuthorities(LGAs)canbemoreinvolved

insustainingtheselocalentities.

Background

Launchedin

2003,

the

initial

emergency

phase

of

PEPFAR

concentrated

on

meetingtheurgenttreatmentandcareneedsofpeoplelivingwithHIV/AIDS.

AsPEPFARbeginstofocusmoreonsustainability,USAID/Tanzaniawouldlike

tostrengthenitssupportoflocalNGOsandLGAs.

Approach

Thestudyfocusedontheworkofthreeprimerecipientsunder

USAID/TanzaniasHIV/AIDSprogram:

AMREF(AfricanMedicalResearchFoundation): The$2.1millionANGAZAZAIDIcounselingandtesting(CT)projecttoexpandthese

servicesthroughvoluntaryandmobileCT,especiallyremoteandhigh

riskgroupsandintegrateCTactivitiesmorecloselywithProvider

InitiatedTestingandCounseling.

ElizabethGlazerPediatricAIDSFoundation(EGPAF): The$4.6millionawardwith4NGO/FBOsand33DistrictsandMunicipalCouncilsto

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expandpreventingmothertochildtransmission(PMTCT)servicesthrough

trainingandsupportofthesestaffatprenatalclinicsandlaborwards.

PactTanzania: The$4.5millionJaliWatotoprogramtosupportorphansandvulnerablechildrenthroughlocalNGOsandMost

VulnerableChildrens(MVC)Committees.

AfterpreliminarymeetingswiththeseorganizationsinDaresSalaam,Mr.Walsh

traveledtofieldofficestomeetmoredirectlywiththestaffoflocalNGOs,FBOs,

CBOsandDistrictofficials:

AMREFsMoshiZonalOfficeandMaranguHospitalinKilimanjaroRegion

EGPAFsMoshiRegionalOfficeandtheMoshiMunicipalCouncil,aswellastheShinyangaRegionalOfficeandKahamaDistrictHealthOfficeand

DistrictHospital PactTanzaniaparticipantsworkinginTabora

Mr.WalshalsoconductedthreeRoundtablediscussionstogatherinput:

AMREFparticipants(15)inMoshi,includingparticipantsfromArushaRegionandKilimanjaroRegion

EGPAFComplianceOfficers(17) PactTanzaniapartners(13)anddistrictofficials(2)fromTabora,metin

Shinyanga

OverviewofProgramsAMREF EGPAF PactTanzania

Subaward

Program

description

ANGAZAZAIDI(toshed

morelight)isanextensionof

the7yearANGAZA(toshed

light)counseling&testing

program. AMREFhasbasic

supportpartnerswhoare

experienced,tiedtothe

Ministryof

Health

and

have

diversifiedfunding. AMREF

IntensivePartnersrequire

morecapacitybuildingand

closerM&E. Subawardeesare

supportedbydecentralized

zonalofficesstaffedbyateam

leader,aprogramofficeranda

EGPAFsPMTCTprogram

focusesonDistricts,

MunicipalCouncilsandafew

NGO/FBOhospitals.

ProgramandCompliance

staffregularlymonitorfrom

theirregionaloffices,

supplementedwith

Monthly

financialreportsand

quarterlyprogramreports.

Regionalstaffare

supplementedwith

Monitoring&Evaluation

personneltoassureproper

dataqualityaswellastimely

Pact/TanzaniasJaliWatoto

programmobilizeslocal

NGOs,volunteersandMost

VulnerableChildrens

Committeesatthevillage

level. LocalNGOswere

selectedthroughaninitial

twostage,

open

competition

withsupportfromPact

personnel. Awardsare

monitoredbyprogramand

compliancestafffromDares

Salaamandthesubmissiono

quarterlynarrativeanddata

reports.

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financeofficerwhoprovide

readilyaccessiblesupportand

guidance.

andaccuratereports.

Howdoes

the

mechanism

build

capacity?

Trainingisprovidedbasedon

theexpressedneedsofthe

local

partners.

The

training

is

supplementedwithclose

monitoringandmentoring.

Zonalstaffarereadily

available.

Trainingsaresupplemented

withregularmeetingsby

program

and

finance

staff.

Theyhaveconductedservice

deliverytrainingsprimarily,

buthavesupplementedthese

withproposalwritingand

planningworkshopsand

otherfinance/compliance

relatedtraining. TheDistricts

proposetraining,whichis

oftendrivenbychanges,

turnoverandexpansions.

Theworkshopsare

supplementedwithfaceto

facemeetingsrangingfrom1

3days.

Trainingandregularmeeting

supporttheworkandbuild

the

capacity

of

the

local

partners.Monthlyfinancial

reportsbuildgreatercapacity

whilemitigating

disallowances. Districtcoun

focalpersonsformost

vulnerablechildrenandMVC

Committeesatvillagelevel

haveallbeenincludedin

trainingreceivedbyNGO

partnersandvolunteers.

Capacity

outcomes

and

precipitating

factors

Fundinginterruptionsentailed

delaysandscalingbackof

activities. Somesubgrantees

havelearnedskillsinproposal

writingandhavesuccessfully

wonothergrants.

Reportingdemandsand

fundinginterruptionsare

distractions,whileleadership

isacriticaldeterminantof

success.

Mostsubawardeesare

improvingtheirabilityto

operatewithlesssupervision

Fundinginterruptionsaffect

activities.

RoleofGoT

andits

perceived

valueof

capacity

building

AMREFassuresthatlocal

partnerscoordinatetheir

activitiescloselywiththeDistrictoffices. A

decentralizedzonalapproach

reinforcesthisrelationship.

Supportivesupervisionis

carriedoutincollaboration

withtheDistricts. Annual

MOUsarenegotiatedamong

AMREF,thesubgranteeand

thelocalgovernment,

representingathreeway

partnershipfrom

the

beginningandavoidingthe

creationofatwoway

dependency.

TheDistrictspropose

training,whichisoften

drivenbychanges,turnoverandexpansions.Workshops

aresupplementedwithface

tofacemeetingsof13days.

PactassuresthatDistrictleve

officialsareinvolvedwithth

program. Theydliketoseemoreinvolvementofthe

districtsinassessmentsand

ongoingmonitoring. The

lackoffundsfordistrict

councilfollowupofMVC

programposesaparticular

challenge. Capacitybuilding

ofLGAsisunderfunded.

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OverviewofFindings

ThereisbroadappreciationforthePEPFARfundingamongtheDistrictofficials

andlocalNGOsinvolvedwithandinterviewedforthisstudy. Thisisoneofthe

firstpointstheyalwaysemphasizedinthediscussions. Theyrecognizethat

withoutthegenerosityofthedonors,theywouldnotbeabletodotheir

importantworkwithpeoplelivingwithHIV/AIDS.

Theprogramsarewellstructuredtoaccomplishtheintendedobjectives. The

linkageswiththegovernmentattheDistrictandCouncillevelsareemphasized

byallpartners. Theyclearlyunderstandandactivelyworktostrengthenthe

engagementofthedistrictlevelgovernment.

Whilethefundinglevelsandengagementoflocalgovernmentauthorities

supportthesuccessoftheprograms,thereareanumberofchallengesthatimpedethesustainabilityofthelocalpartners:

1. Disruptionsinfundingaresignificantsetbacksfororganizationstryingtosustainconstructiverelationshipswithcommunities.

2. Demandsofthedonorsforregularreportsimposeasignificantburdenonalreadystrappedhumanandtimeresources.

3. Expectationstoachieveimpactwithlimitedprogramfunds.4. Notoleranceoffinancialorcompliancefailures,whichwouldentail

significantdisallowances

or

penalties.

Nonetheless,thelocalNGOsandDistrictsareallstrivingtoservetheir

beneficiariesbetterwhilemeetingthedemandsofthedonors. Oneofthe

underlyingstrengthsoftheseorganizationsisthepartnershiptheydemonstrate

inworkingwithothers. Thereareconstructiveworkingrelationshipsextending

fromthedonors,downthroughUSAID,itsprimesandsubawardees. Anumber

oftheprogramstaffinDaresSalaamobservedthatthereisgoodcollaboration

amongthedonorsatthenationallevelthatisimportanttothesuccessoftheir

sector. Further,allimplementingpartnersdescribedagoodworking

relationshipwiththeirAgreementOfficersTechnicalRepresentative(AOTR)andAgreementOfficer,whichisconsideredanessentialingredienttotheir

success. Further,verysupportiverelationshipswereobservedbetweenthefield

programandfinance/compliancestaffandthelocalentitiestheysupport.

DistrictofficialsandNGOstafffelttheycouldrelyontheprimesstaffto

respondtotheirinquiriesandconcerns.

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ThefollowingarerecommendationsforUSAIDtoconsiderinsupportingthe

capacitybuildingoflocalNGOsthroughprimecooperativeagreement

recipients. Asrequested,therecommendationsarecategorizedintermsofshort,

mediumandlongtermactionssothattheycanbemorereadilytranslatedinto

workandactionplans. ThediscussionisframedintermsofUSAIDs

programmingandgrantmakingprocess,startingwithprogramdefinitionand

designthenextendingtonegotiation/award,implementationandconcluding

withcloseout.

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I.Programming/DesignIssues

1.DevelopBenchmarksLeadingtoMoreCapableDistricts&Councils

TheDistrictsandMunicipalCouncilsarecentraltotheseprograms. Thelatest

OVCRFAhasacoherentandcomprehensivestrategicperspectiveonworking

withthelocalGovernment. TheengagementofthedonorsandtheDistrictand

Municipalentitiesiscritical. AspointedoutbyaMunicipalCouncilDirectorof

Health,theyvaluetheinvolvementofdonorsandinternationalNGOswhich

bringfocusedfundingandexpertise.Whilemanagementofthesestandalone

verticalprograms,isdemanding,theyaccepttheresponsibilitiesandthe

assistance,butworryaboutsustainingthemwithlimitedbudgetsandstaff.

OthershaveobservedthelimitedcapacityoftheLGAs. Forexample,onlytwoofficialsfocusonHIV/AIDSattheDistrictlevelandtheyareoftenbusy

attendingtrainings,meetingsandpreparingadministrativedocumentsand

reports. Inshort,theDistrictshaveinsufficientlytrainedstaff,inadequate

financial,procurementandreportingsystemsandashortageofcriticallogistical

supporttocoverawidegeographicarea. TheGlobalFundauditofGrantsto

TanzaniadatedJune,2009capturesthechallengesfacedandtheriskofrelying

tooheavilyonLGAsatthistime.

TheDistricts

and

Councils

will

need

to

take

on

added

responsibilities

to

support

theHIV/AIDSprogramsinthefuture. Butwhatformandfunctionswillthese

LGAshavetomanagetheseprogramsandhowwilltheysupporteachotheras

donorfundingreachesitslimits?WillfundingmovethroughtheDistricts?Will

awardsbemadetolocalNGOsthroughthePrimeMinistersOfficeofRegional

andLocalGovernments(PMORALG)? OrwilltheDistrictsleadandcoordinate

thefundsmanagedbyothers? Canthedonorbasketfund,whichtheLGAsare

familiarwith,beenhancedtosupporttheseefforts? Theseandotherquestions

mustbeansweredsoontoprovidesufficienttimetodevelopthecapacityof

theseentities.

EachDistrictandCouncilisatadifferentstageofcapability. Oftenleadershipis

acriticalfactor,butallarestrugglingwithhighturnoverratesandtheabilityto

manageacumbersomebureaucracy.RushingallLGAstodevelopbyacutoff

dateisunreasonable,sograduationshouldbebothstagedandstaggered.

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Recommendations

ShortTerm

o Encouragethebestpracticeofannualnegotiationof(nonmonetary)MemorandumsofUnderstandingamongtheprimepartner,sub

granteesandthelocalgovernment. Thisthreewaypartnershipdetails

oversight,routinesupervision,suppliestobeprovidedbytheLGA,

jointdevelopmentof12monthactionplanwithspecifictasks,joint

outreachactivities(andlogistics)aswellascapacitybuilding

milestonesandrelatedtrainingandassistance.

MediumTerm

o ReachagreementbetweenGoTandthedonorsonthecapabilitiestobedemonstratedbyDistrictsandMunicipalCouncilstopermitthemto

managedonorfundsmoreindependently.o Determineandappropriatelybenchmarkthestagesleadinguptothis

levelwithtechnicalassistanceandtrainingplannedandprovidedto

assureDistrictsprogress.

o Provideonthejobcompetencybasedtrainingprogramsthatleadtoactualqualificationsforstaffinvolved.

o IncludecriticalsystemsandorganizationaldevelopmentintheCCHPforeachDistrictandMunicipalCouncil.

o Encouragepartnerstoofferprogrammaticandbudgetinformationforinput

into

CCHPs.

2.ManageCashFlowInterruptionswithMoreInformation

Cashisthelifelineofthelocalpartners. Theyhavenobufferagainstfunding

interruptionsorreductions,whichareinevitable,butshouldbeminimizedover

thecourseofayear. USAIDandotherdonorsreceivetheirfundinglateintheir

budgetcycles,whichdelaysonwarddisbursementstotheprimerecipientsand

ultimatelythelocalNGOs. USAIDsreputationfortimelypaymentisbetterthan

otherdonors,butitsuffersfromoccasionaldelaysinobligationoffunds.

FewNGOshavesufficientunrestrictedfunds(i.e.nonFederal)tofinancegapsin

funding,especiallyiftheycannotbecertainthatUSAIDorotherdonorswill

comethroughwiththefunding,orwillcovercostsincurredbeforefundsare

available. ThePrimeNGOsarepursuingpublicprivatepartnershipsandother

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donorfunds,buttheagreementswillnotbesufficientorbroadenoughtocover

possiblefederalshortfallsorinterruptions.

DelaysalsooccuronthepartoftheprimeNGOsintheirprocessingofpayments.

OftenthelocalNGOhavedifficultycompletingalltherequiredreportsand

documentationinatimelyandaccuratemannertoassureregularpayments. The

primeNGOsprocesspaymentsthroughtheirheadquarterswhichmayentail

additionaldelaysifthereareanyquestionsraisedorglitchesintheirhandlingof

transactions. Thesedelayscanbeminimizediftherearesufficientfieldstaffto

supportlocalNGOsinaccuratelydocumentingtheirsubmission.

Whenfundingisinterrupted,localNGOssalariesgounpaid(describedbyNGO

staffasinvoluntaryvolunteering),fieldactivitiesgrindtoahaltasstaffdont

havefundsforfareorpetrol,andthevillagersareworryingiftheycanrelyon

theservicesandsupportoftheNGOs. Districtsexperiencesimilardelays,often3months,duetothemanylayersbetweentheLGAsandthecentral

authorities. Continuityisessentialforthecare&treatmentofHIV/AIDSandthe

supportoforphansandvulnerablechildren. Theimplementingpartnersat

everylevelareaffectedbyfundingcutsanddelays. Forexample,theAMREF

subgranteestaffexpressedconcerninthatinterruptionsanduncertaintyof

fundinghindersplannedandexpectedactivitieswhichdemoralizesand

discouragesmembersofthecommunityinconfrontingtheHIV/AIDSpandemic.

Providingmoreinformationpermitsthemtomanagemoreeffectivelytomitigate

theimpact

on

the

beneficiaries.

Recommendations

Shortterm

o Provideasmuchinformationassoonaspossibletotheprimesandsubrecipientsonthestatusoffundingsothatplansmaybeadjusted

andmitigatingactionscanbetaken. Timelynotificationmaypermit

thelocalpartnerstoextendimplementation,delayexpendituresand

manageexpectationsuntilfundingarrives.

o EncourageadequatestaffingoffinancialoversightinthefieldtoanticipateandmitigateproblemswiththelocalNGOs,ratherthan

overrelyonheadquarterstafftomonitorcomplianceaspartofthe

paymentprocess.

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3.ExtendCommitmentBeyondAnnualProgramCycles

EachdonorandtheGoThavetheirownannualprogrammingcyclesthatfocus

onquantifiableresults,butcapacitybuildingtakes57yearsanddoesnotlend

itselftoreadymeasurements. Theseannualcyclesarealsonotsynchronizedand

areoftenthrownoffwhenfundingisntprovidedasplanned.

Localentitiesmustwaitmonthsforfunding,whichcompressesa12month

implementationplanto10to8months,whichisverydisruptive. Notlongafter

theyreceivetheirannualfunding,theNGOmustthenbeginpreparingfora

proposaltorenew,withtheinherentuncertaintyofcontinuation. Oneyear

tranchesandtheefforttorenewaretransactioncoststhatdistractfromservice

deliveryandcapacitybuilding. Further,workingwithchildrenandpeople

livingwithHIV/AIDSentailsalongertermcommitment,wellbeyondthe35

yearawardsoftheprimes. Alocalpartnernotedthatiftheirprimecouldmakeformal,multiyearcommitments,theywouldreachfurtheranddevelop

complementaryservicesinthoseareas.Withoutalongertermcommitment,they

arehesitanttocommittheseservicesandthenriskdisappointmentbythe

beneficiaries.

Recommendations

Shortterm

oEncourage

the

primes

to

enter

into

longer

term

agreements

with

their

subrecipients,contingentuponavailabilityoffunds,(justasUSAID

doeswithitspartners)sothattheextensionprocesscanbefacilitated.

Longterm

o Whileannualprogramcyclescannotbechanged,USAIDshouldsupportconsistentfundinglevelsandlongertermagreementswiththe

primes.

4.Define

Benchmarks

Leading

to

More

Capable

Local

NGOs

CapacityBuildinghasbeenfocusedonservicedeliveryunderPEPFARI. To

sustainHIV/AIDSprograms,capacitybuildingmustbesupportedmorebroadly

toincludesupportoforganizationsandnetworks,enhancingmorethan

technicalskillstoincludeoperationalsupportandtheabilitytomanage,adapt

andevenadvocateasanorganization.

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LocalNGOshavelimitedresourcesorexpertisetoinvestintheirowncapacity

building. Subawardbudgetsareusuallyconfinedtoprogramimplementation,

withlimitedsupportformanagementoversight. Thereisalsonobroad

assessmentofthesector. Atbest,eachprimehasconductedreviewsofsub

recipientsinthecontextoftheirprogramactivity,leadingtoastovepipe

perspective. Annualormidtermassessmentsarealsoconfinedtosubrecipients

andtheirabilitytoperformthescopeofwork,ratherthandeterminetheir

progresstowardsasustainableentity.

Further,thedevelopmentstagesandendstatearenotcurrentlydefinedforthe

subrecipients. ThecurrentOVCRFAdefinesastandardthatthelocalNGO

shouldbeeligibletoreceiveUSAIDfundingdirectly. Thisstandardcanbe

definedintermsofUSAIDsresponsibilitydetermination,whichaccordingto

ADS303.3.9meanstheorganization:

o possesses,orhastheabilitytoobtain,thenecessarymanagementcompetencetoplanandcarryouttheassistanceprogram,

o canappropriatelyaccountforfundsandotherassetsprovidedbyUSAID,

o hasasatisfactoryrecordofbusinessintegrity,ando isotherwiseeligibleforaward(e.g.notonadebarredorOFAClist).

Theresponsibility

determination

standard

is

specific

to

the

work

to

be

performedintermsofmagnitude,complexityandduration. Itdoesnottakeinto

considerationthesustainabilityofthebroaderactivityortheneedfortheNGO

tocompeteforlimiteddonororGoTfunding.

Theprocessofincreasingthecapacityoflocalentitiesmustreinforceasenseof

ownershipoftheissuestoassureultimatesuccess. Preawardassessments

conductedbyprimescanbemanipulatedormisleading,notingexamplesof

temporaryofficesandstafftogivetheimpressionthatanNGOismorecapable.

SelfassessmentsbasedongoodexamplesfromtheTanzaniancontextaremore

effectiveiffacilitatedandverifiedbytheprime. TheprocessofdevelopingcapacityiscriticaltosustainingthecapacityofthelocalNGO.

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Recommendations

Shortterm

o HarnessfacilitatedselfassessmentsbylocalNGOstosupporttheirsenseofownershipoftheissuesandeffortstostrengthentheir

capacity. (See:RecentPracticesinMonitoringandEvaluationTIPS

MeasuringInstitutionalCapacity,2000No.15) Obtaininputfrom

Districtsandcommunitybeneficiaries. Verifyassessmentfindings

selectively,especiallyincompetitivecontexts.

Mediumterm

o EstablishbenchmarksleadingtoagraduationstandardforlocalNGOs. Stagesmayincludebasicskillbuildingandorganizational

development,followedbymoreworkwiththeDistricts,expansionof

activities,culminatinginaregistrationstandardorabroaderUSAIDresponsibilitydetermination. Atgraduation,thelocalNGO

shouldhave:

Governancestructures(board,organizationalgoals,leadershipstructure,legalstatusandconstituency)

EffectiveManagementPractices(planning&programdevelopment,reporting,administrativeprocedures,information

management,organizationalstructure)

EstablishedHumanResources(qualifiedstaff,clearroles,adherence

to

labor

laws,

salary

&

benefit

structure

and

policies,

supervisorypractices)

AdequateFinancialResourcesandSystemsforManaging(steadyfunding,accounting,budgeting,financial/inventory

controls,reporting)

PerformanceAbility(appropriateexpertise,recordofsuccess,abilitytoassessimpactandreportaccurately)

EffectiveExternalRelations(sustainingrelationshipswithbeneficiaries,constituencies,governmententities,otherNGOs

anddonors)

Programssustainedbyotherdonorsorsourcesofrevenueandbroaderengagementwithotherentitiestosustainsupport.

o ConductsectorwideassessmentsoftheNGO/FBO/CBOswithfollowupmidtermassessmentstodemonstrateimpact.

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Longterm

o ThefeasibilityofagraduationpathmustbesupportedbyUSAIDswillingnesstocommittolongertermplanningandfunding.

o Programdesignandproposalsshouldbeinformedbycircumstancesanticipatedbeyondtheestimatedcompletiondateoftheawardto

supportsustainableactivities.

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II.Negotiation/Award

1.InvestinOperationalSupporttoEffectivelyManageRisk

Federalregulatorystandardshavenotoleranceforfinancialorcompliance

failures. Undocumentedcosts,absenceofpriorapprovalsandotherviolations

leadtodisallowancesandfineswhichareseriousdeterrentsforNGOswith

limitedfinancialreserves. TheprimeNGOsmanagethisbyconducting

thoroughriskassessmentsandmanagingtheorganizationsandissuesthatare

mostcritical. USAIDandotherdonors,however,routinelyconstrainandcastan

especiallycriticaleyeoncostsforheadquarters,finance,complianceandother

supportfunctions,evenasprogramshavegrown. Finance,compliance,and

contractingstaffandtheirfunctionsareessentialtomanagingriskandassuring

thelongtermviabilityandgrowthoftheirorganization.

Despitetheimportanceofthefinanceandcompliancefunctions,thereispressure

tominimizethesecostsateverypointintheawardprocess. Program

descriptionsaredevelopedwithanemphasisonmeasurableresultswhichare

oftentiedtodollaramounts;thereforetherelative returnoninvestment is

emphasizedattheexpenseoffinancialandregulatorycompliance.WhenNGOs

developtheirapproachtoasolicitation,theyoftensqueezethesupportcoststo

demonstrategreaterefficiency. Duringthecourseofnegotiations,USAIDand

donorsingeneralpushonsupportcostsbecausetheresnoagreeduponruleof

thumbto

assess

their

reasonableness.

Rather

than

jeopardize

the

award,

NGOs

oftenacquiesce,resultinginstaffingandsalarylevelsthatareinadequateto

appropriatelymanagetherisks.

ThisdynamicextendstothelocalNGOsaswellinwhichtheyrarelyresistthe

negotiatingpositionsoftheprimes. Theydontwanttorisklosingthe

subaward. ItisdifficultforNGOsandDistrictstoattractandretainqualified

staffgiventheseconstraints. Forexample,thereisashortageofqualified

bookkeepersinTanzania,withmostseekingbetterremuneration,ofteninthe

largercities. AlocalNGOmightbudgetforfinancialstaffrangingfromTsh.200

600,000/month. Incontrast,aUSAIDfinanceassistant/cashierearnsbetweenTsh.1,200,000 1,500,000/month.

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Recommendations

Shortterm

o Supportoperationalfunctions(finance,compliance,HR,etc.)adequately,ifnotgenerously,inbudgets. Permittheprimesto

proposecosteffectivesupportstructuresgiventhenatureofthe

programandanticipatedrisks.

o Supportdifferenttypesoftrainingandprofessionaldevelopmentforthesestafftohelpmitigateturnoverandtoenhancethecapacityofthe

organization.

2.BestValueAwardDeterminationsShouldIncludeCapacityBuilding

Considerations

Thecompetitiveprocessdoesnotadequatelysupportsustainability. Thedonorsplaceapremiumoncosteffectivenessthatdoesnotmatchwithriskmanagement

ortheneedtobuildlocalpartnercapacity. Pressuresonsupportcosts(e.g.

accountants)andlogisticsaredetrimentaltolongtermsuccessoflocalpartners.

ThereisnoreserveincludedinUSAIDawardsthatcansupportinvestmentin

capacitybuilding. Thecostsarededicatedtoimplementationoftheprogram,

notinvestmentinthefuture,unlikeaforprofitfirmearningfixedfee.

Recommendations

Shortterm

o IncludecapacitybuildingintheprogramdescriptionofRFAssothatcostscanbeallocatedtothisobjective.

o Considertheprospectsforaccomplishingcapacitybuildingandsustainabilityobjectivesintheoverallbestvaluedeterminationofthe

solicitation.

3.SetToneofCollaborationwithBroaderPartnerCommunity

Thecollaborativetoneamongthedonors,USAIDinparticular,andtheGoTshouldechothroughtheimplementingpartnersdowntothelocallevels. There

appeartobegoodworkingrelationshipsbetweenUSAIDandtheprimeNGOs.

Partnerintervieweeseachnotedtheconstructiveengagementtheyhavewiththe

AgreementOfficer(AO)andtheAgreementOfficersTechnicalRepresentative

(AOTRs),creditingthemwithleadershipinthesectorandcommitmenttothe

work. Similarpositiverelationshipswereobservedbetweenthefieldofficesand

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thelocalNGOsandDistrictsthattheysupport. Theyfeltsufficientlycomfortable

tospeakcandidlyaboutthestrengthsandweaknessesoftheprogram.

Collaborativeworkingrelationshipsareessentialtoeffectiveandefficient

programmanagement.

Opencommunicationonaregularbasissupportstimelyresolutionofissuesand

mitigationofrisk. Ifacriticalissuelooms,afieldpersonismorelikelytoquickly

elevateitforguidanceifagoodworkingrelationshipalreadyexists. USAIDcan

reinforcethiscollaborationwithregularconferenceswiththebroaderpartner

community,andsupportforsimilararrangementsbetweentheprimesandtheir

subrecipients.

Recommendations

Shorttermo SupportthebestpracticeofconductingPreproposalconferencesto

assurethatallpartiesfullyunderstandtheactivitytopreparemore

realisticproposalsormakebetterinformedgo/nogodecisions.

o EncourageandfundPostAwardconferencesthatgobeyondthereviewoftheawarddocumentandincludeestablishmentofa

frameworkforworkingtogether. Allpartiesshouldparticipateand

establishstandardsofcommunications(e.g.nosurprises),howissues

willbeelevated,howoftenthepartieswillmeet,whowillmaintain

minutesand

action

items,

etc.

Mediumterm

o ConductregularPartnersDaymeetings,hostedbytheMissionDirector,SOTeamLeadersorAgreementOfficer,todiscusscommon

issuesoftheimplementingpartnersinTanzania. Representativesof

thecontractorsandgranteesworkinginTanzaniawillappreciatethe

opportunitytolearnfromtheseofficialsaboutrecentguidancefrom

USAIDandtoprovideinputonpressingissues.Modeledafterthe

M/OAAsponsoredPartnersDay,thegroupcanalsoestablishadhoc

workinggroupstoaddresscommonimplementationissues. ThecriticalelementisthatthePartnersDayprovidesanopportunityfor

thecontractorsandgranteestoraiseanddiscussissuesofmutual

concern,rangingfromoperationalproblemstostrategic

considerations.

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III.Implementation

1.StreamlineandDelegateAdministrativeApprovals

PriorApprovalsareworkingwellforsubawardsbasedongoodworking

relationshipsandastrongconsensusontheprogram. TheAOTRsrecognizethe

needfortimelinessandknowtheprocessforreviewandapproval. However,

theprimeshavealsoadjustedtheirprogramstoavoidtheneedtoobtainmore

onerousadministrativeapprovals,suchasrenovationcosts,

international/regionaltravel,livestockforincomegenerating,seedsforbackyard

gardensandmotorcyclesforworkers. Someapprovalshavetakenaslongas8

months.NGOsandtheDistrictsrepeatedlyexpressedpuzzlementaboutthe

needforadditionalapprovalsifthecostisalreadyincludedinthebudget. They

observedthatsuchmicromanagedapprovalsdidnotgivethemasenseof

ownership.

OnlybudgetincreasesandprogramrevisionsmustbeapprovedbyAgreement

Officers. Allotherapprovalscanbedelegated,streamlinedorblanketed. Under

22CFR226.25(e), theAOcandelegateapprovaltoAOTRsfor awardeechanges

inkeypersonnelortheirreducedworkontheproject,budgetlineitemrevisions,

subawardsandsubcontracts. Onetime,nocostextensionscanalsobe

authorizedforupto12months.

TheMission

Director

can

also

authorize

blanket

waivers

for

source/origin/nationalityrequirementsunder22CFR228,aswellasapprovalof

restrictedgoodswithincertainparameters.PEPFARalreadyprovidessuch

authoritywhichshouldserveasabasisforblanketwaivers. TheNGOpartners

preferblanketwaiverssothattheydontneedtoexpendtheadditionaltimeand

efforttoseekadditionalapprovalsinthefuture.

Approvalscanalsobestreamlinedtoavoidbottlenecksthatdelay

implementation. OftenUSAIDandtheimplementingpartnerarenotclearon

thecriteriaortheprocessforapproval,resultinginprotractedexchanges

requestingadditionalinformationandclarifications.

USAIDawardsarenotoriouslyadministrativelyburdensome. Otherfederal

agencieshaveeliminatedorstreamlinedapprovalstominimizenonvalueadded

requirementsonprofessionalstaff. Theapprovalofinternationaltravel,for

example,wasarequirementestablisheddecadesagofordomesticorganizations

havinglittlereasontotravelabroad. Thestandardusedbyotherfederal

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throughtheZonalofficeswiththeguidanceoftheMinistryofHealthandSocial

Welfare. Thenewreportingproceduresminimizethetimeandreducedouble

reportingofdatatoAMREFandtheresponsibleDistrict.

Whilethereportingrequirementisaburden,itisalsoabarometerofthe

partnersabilitytoaccuratelyandtimelyprepareandsubmitreports. The

learningcurveforreportpreparationissteepanditimposesadisciplinethat

preparestheNGOforfutureawards. Programofficersnotedthatreport

preparationisabasicbusinessprocessthatmustbestrengthenedfortheNGOto

beresponsibletothedonors.

Recommendations

Shortterm

o USAIDshouldcontinuetosupportthePrimeseffortstostrengthenthereportingcapacityofthelocalpartners.

Longterm

o USAIDshouldsupporteffortstoharmonizedatacollectionandreportingwithGoTanddonors. GreaterrelianceonGoTreporting

standardswillstrengthentheircapacity.

3.AuditsorReviewsConductedRegularlyRatherThanattheEndofthe

Activity

PrimeNGOsadheretotheprinciplethatratherthanauditingtothepenny,you

managetothedollar. Unfortunately,theauditorsdontalwayssharethis

perspective. Theideaistomanageriskratherthanavoidit. Regularreviews

andriskreassessmentswillhelpidentifyandaddressproblemsbeforethey

groworbecomeentrenched. ThelocalNGOsalsorecommendedthatthe

financialreviewersdonotcomeinasinspectors,whichputstheNGOsina

defensivemode,butratherasassessors. AMREFssubgrantmanagers,for

example,visiteachsiteandchecktheboxfilestoassuretransactionsare

properlydocumentedandcomplete,whichisverypracticalandeasilyverifiedwhileimposingadisciplineontheNGO. EGPAFcompliancestaffregularly

meetwiththeirdistrictstoreviewdocumentationandaddressanyissuesor

concerns. Eachofthethreeprimesconductregularvisitstodevelopa

mentoringrelationship,asdescribedinmoredetailbelow.

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Recommendations

.

Shortterm

o AssurethatPrimeNGOsconductregularreviewsinaconstructivemannerwithtimelyfeedbackandfollowup.

Mediumterm

o USAIDshouldcontinuethepracticeofconductingannualmanagementreviewsoftheprime. ThereviewconductedofEGPAF

wasdescribedasabestpracticeinthatithelpedthemmakenecessary

adjustmentsoutsidethecontextofaformalaudit.

4.MentoringbyPrimesofSubrecipientsisEssential

Thedifferencebetweenmonitoringandmentoringinprogrammanagementisthequalityoftherelationship.Monitoringisamanagementtoolwhile

mentoringaddsvaluetoperformanceofobjectives. Thequalityofthe

relationshipbetweentheprimeandthesubrecipientsisanessentialingredient

forsuccessfulprograms. ThethreeinternationalNGOsvisitedhaveaclose

workingrelationshipwiththelocalpartnersthathelpsmanageissuesand

changeincircumstances. Decentralizationandthecreationofzonalteams

furtherfacilitatecoachingandmentoring.

Decentralizationis

abest

practice.

When

program

and

finance

staff

are

located

intheregionsorzonaloffices,theydescribegreateraccess,commitmentand

engagementwiththelocalpartnersaswellasbettertrainingandmore

productiverelationshipswiththeDistrictoffices. Thestaffarealsomorereadily

availabletotroubleshootatanytime. (Forexample,theAMREFFinanceOfficer

answeredcellphoneinquirieswellintothenightasNGOleadersfinallyhada

chancetositdownandreviewtheirbooks.) AMREFsubgranteesreportedthat

theyareverypleasedwiththedecentralizationprocesswhichtheybelieve

encouragesmoreeffectivecommunicationandcoordination. AMREFs

experiencealsosuggeststhatdecentralizingthesubgrantingprocessismore

effectivecomparedtotheirformercentraloperationsapproachwhichoftenprolongedthesubgrantingtasks.

Whiletherelationshipsaresupportive,theNGOsmustbetrainedtomore

effectivelynegotiatetheirawards. Toooftenlocalpartnersagreetoanyassertion

oftheprimesbecausetheydonotwanttojeopardizetheaward.Whilepartof

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thisdeferenceiscultural,anotheraspectissimplythenatureofthecompetitive

processinwhichitiseasiertonegotiateafterawardthanbeforehand.

Giventheimportanceoftherelationshipbetweentheprimeandthesub

recipients,itsqualityshouldbebenchmarkedandmonitored. Afeedback

mechanismshouldalsobeestablishedtoassureactionontheinformationto

makenecessaryadjustments.

Recommendations

Mediumterm

o Decentralizationisabestpractice. Supportcosteffectivemeansofestablishingafieldpresencefortheprograms.

o Supportworkshops,aspartofthecapacitybuildingprocess,thattrainNGOstaffoneffectivenegotiating,especiallyinthecompetitiveprocess.

o Benchmarkthequalityoftherelationshipbetweenprimesandsubrecipientstoassureproperattention.

5.SupportCoordination/CollaborationamongPrimesandLocalNGOs

TheDistrictcurrentlyservesasafocalpointforcoordinationoflocalNGOs. The

developmentoftheCCHPhelpssupporttheengagementofthelocalpartners,as

sustainedby

coordinated

activities

over

the

course

of

the

year.

In

Kahama

District,forexample,theDistrictMedicalDirectormeetswiththeNGOsto

discusstheGoTprioritiesandtosolicittheirinputandcontributionstothe

activities. ThelocalNGOswillthencoordinatetheiroutreachandother

activitieswiththeDistrict.

Therearefewerexamplesofcollaborationamongtheimplementingpartners.

TheImplementingPartnersGroup(IPG)underPact/TanzaniasOVCprogramis

abestpracticewithregularandcomprehensiveparticipationatthenational

level. PactactsasSecretariatoftheNationallevelIPGwhichhasover90

organizationsasmembers,ischairedbyDSWanditsregularmonthlymeetingsarehostedbyUNICEF. AsexpectedbyUSAID,thismodelshouldbereplicated

ineachdistrict. Forexample,groupsareestablishingasimilarIPGintwo

DistrictsinTabora. AnotherexampleisEGPAFsuseofaDistrictmapofNGO

activities. EGPAFidentifiedMildmayasacollaboratingpartnertocontinuecare

ofpatientswhentheyreturntotheirvillages. Afewforumsandother

coordinatingattemptswerementioned,buthavenotbeensustaineddueto

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limitedresources. Forexample,thePLHIVNetworkmodelisausefuloneandis

hostedbytheRegionalMedicalOfficersinsomecases.

Recommendations

Longterm

o Districtsshouldremainthefocalpoint,butsupporttheestablishmentofregularRoundtablesorimplementingpartnersmeetingsatthe

DistrictlevelforlocalNGOstonetworkandcollaborateoncommon

issues.

o DistrictmappingofNGOactivitiescanfeedintotheCCHPandcoordinationofactivitieswithcomplimentaryprograms,suchas

nutrition.

6.Training

is

aContinuous

Need,

but

It

Requires

aTraining

Strategy

and

AlternativeModels

ThelimitedcapacityoflocalNGOsandDistricts,coupledwithhighturnover

ratesofprofessionalstaff,driveaneedforalmostconstanttraining. Allthelocal

partnershaddifficultyhiringandretainingqualifiedfinancialstaff. Invariably,

theprimeshadtotrainnewstaffondonorreportsandprogramrequirementsa

fewtimesayear. Frequenttrainingsareexpensiveanddonotaddressthe

underlyingchallengeofretention.

Thereisalsoasensethatinsomeactivities,thetrainingreceivedbytheLGAsis

oftenadhocandunplanned,withdecisionsastowhoattendswhattraining

oftenbasedonwhoisperceivedtobenextinlineforbenefitingfromexternally

fundedtrainings,includingthetravelallowancesandperdiems. Thetrainingof

LGAsingeneralwouldbenefitfrombetterplanningandaconsensusonhowit

willdirectlybenefitcapacitybuilding.

Recommendations

Mediumtermo Conducttraininginresponsetoabusinessorprogramissuewhichis

alsotiedintoabroaderorganizationalobjective. Forexample,

employeeretentionisamajorchallengeforsustainability;therefore

trainingshouldaddressboththetopicalneedsoftheparticipantsand

thebroaderneedtokeepthemonboard. Trainingofindividuals

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shouldbeconductedwithinabroaderorganizationaldevelopment

strategy.

o EncourageNGOstoexplorealternativestoclassroomtraining,suchastwinning,coaching,certifying,webbasedorcomputerbasedtraining,

etc.

7.CloseoutShouldBePlannedFromtheBeginningandIncludedin

SubawardsandMOUswithLGAs

Theadministrativeprocessofcloseoutisalwaysneglected,untiltheend,when

itstoolate staffmoveontootheractivities,documentsaremisplaced,timeis

limitedandattentioniselsewhere. USAIDhaslittletimetoreviewcloseout

paperwork,approvedispositionrequests,etc. Ultimatelytheresabottleneck

thatpreventsasmoothandefficientcloseoutoftheproject.

Astheawardconcludes,subrecipientsshouldattainthestandardthatwill

permitthemtoworkmoredirectlywiththeDistrictsanddonorstocontinue

theirwork. AllthelocalNGOsarenervousaboutwhathappenswhenthedonor

fundsexpire. Afewareactivelyseekingmeansofdevelopingtheircapacity,but

nonehastheexpertise,leadershiporresourcestoenhancethemselvesalone.

USAID,otherdonorsandtheGoTmustalsoconsiderthesegraduationstandards

inthecontextofastrategyforthesectorthatextendsbeyond2013. Otherwise,

thelocalpartnerswillbetakingagreaterleapthantheyarepreparedfor.

Recommendations

Shortterm

o USAIDshouldrequirecloseoutplansaspartoftheinitialproposalandthenverifytheplansatthebeginningofthefinalyear.

o USAIDshouldsupporttheincorporationofcloseoutplansandgraduationbenchmarksinsubawardsandMemorandumsof

Understanding(MOUs)withLGAstointegrateitsplanningand

resourcing.

Longterm

o USAIDshouldprepareitselfinternallytoexpeditecloseoutprocessing,especiallythedispositionofequipment.

o USAIDshouldrequireprimestomonitorprogresstowardsagraduationbenchmark(includinginternalchecklists,reassessments).

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Districtsshouldbeinvolvedfromthebeginninginverifyingprogress

oftheNGOs.

o USAID,otherdonorsandGoTshoulddefinearealisticscenarioforpost2013supportforthesectorinwhichthelocalNGOswillbe

sustainingthemselves. Carefullyconsidertheimpactandunintended

consequencesofconsolidationofthelocalNGOsectoriflargerawards

aremadetomoreefficientlymanagemorelimitedfunding.

Summary

Thethreeprogramsvisitedareworkingwell,despitechallengesinherentin

HIV/AIDSactivitiesanddonordrivensystems. Anunderlyingstrengththathas

facilitatedcoordinationamongdifferententitiesisPamojana,orworking

togetherwithoneanother. USAIDsinitiativetoexaminehowitcansupport

theworkofthePrimeRecipientsinworkingwiththeLGAsandNGOsreinforcesthischaracteristicoftheprograms. TheMissionswillingnesstomakethe

adjustmentssuggestedintheShorttermrecommendationswillbeasignaltothe

localentitiesofitscommitmenttochangeandalleviatingsomeoftheirmore

immediateconcerns. TheMediumandLongtermrecommendationswillbe

essentialforsustainingtheinvestmentsinthelocalentitiesbeyondPEPFARII.