[Federal Register Volume 71, Number 225 (Wednesday, November 22, 2006)]
[Proposed Rules]
[Pages 67518-67523]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-19707]


=======================================================================
-----------------------------------------------------------------------

AGENCY FOR INTERNATIONAL DEVELOPMENT

48 CFR Part 719

RIN 0412-AA58


Mentor-Prot[eacute]g[eacute] Program

AGENCY: U.S. Agency for International Development (USAID).

ACTION: Proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: The United States Agency for International Development (USAID) 
is proposing to amend its acquisition regulations to formally encourage 
USAID prime contractors to assist small disadvantaged firms certified 
by the Small Business Administration under Section 8(a) of the Small 
Business Act, other small disadvantaged business, Historically Black 
Colleges and Universities and other minority institutions of higher 
learning, and women-owned small business in enhancing their 
capabilities to perform contracts and subcontracts for USAID and other 
Federal agencies. The program seeks to provide a Mentor-
Prot[eacute]g[eacute] Program that assists qualified small business to 
receive developmental assistance from USAID prime contractors in order 
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 minority institutions of higher learning and to 
increase the overall number of small business entities and minority 
institutions that receive USAID grants, cooperative agreements, 
contracts, and subcontract awards.

DATES: Written comments on the proposed rulemaking must be received on 
or before December 8, 2006.

ADDRESSES: Submit comments, identified by the title of the proposed 
action, Regulatory Information Number (RIN), your name, title, 
organization, postal address, telephone number, and e-mail address in 
the text of the message. Accepted methods of submission include the 
following: Federal eRulemaking portal: http://www.regulations.gov. 
Follow the instructions for submitting comments; facsimile: 202-216-
3056; mail: addressed to, Rockfeler P. Herisse, Ph.D. U.S. Agency for 
International Development, Attn. Mentor-Prot[eacute]g[eacute] 
Rulemaking, Office of Small and Disadvantaged Business Utilization, 
1300 Pennsylvania Avenue, NW, Washington, DC 20523-7800, and E-mail: 
rherisse@usaid.gov. All comments will be made available for public 
review without change, including any personal information provided, 
from three (3) days after receipt to finalization of action http://www.usaid.gov/policy/regulations/index.html.
    With respect to proposed reporting requirements and the Paperwork 
Reduction Act, comments should be addressed to Office of Information 
and Regulatory Affairs, NEOB--Rm. 10202, 725 17th Street, NW., 
Washington DC 20503 Rm. 10202, or to Beverly Johnson, Office of 
Administrative Services, Information and Records Division, 1300 
Pennsylvania Ave, NW., Washington, DC 20523 (202)-712-1365 or by e-mail 
to bjohnson@usaid.gov.

FOR FURTHER INFORMATION CONTACT: Tracy A. Scrivner, Mentor-
Prot[eacute]g[eacute] Rulemaking, Office of Small and Disadvantaged 
Business Utilization, U.S. Agency for International Development, 1300 
Pennsylvania Avenue, NW., Washington, DC 20523, (202) 712-4983 or by e-
mail to tscrivner@usaid.gov.

SUPPLEMENTARY INFORMATION:
I. Background
II. Section By Section Analysis
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 December 8, 1995, the Office of Small and Disadvantaged Business 
Utilization (OSDBU) commissioned a thorough assessment of existing 
Mentor-Prot[eacute]g[eacute] programs and the feasibility of such a 
program for USAID. The assessment concluded that opportunities exist in 
such programs to actually encourage meaningful and successful business 
development between Mentors and Prot[eacute]g[eacute]s. Mentor-
Prot[eacute]g[eacute] arrangements represent opportunities for creating 
access for small and disadvantaged business to USAID contracts and 
awards. Both OSDBU and the Office of Acquisition and Assistance (OAA) 
believe that Mentor-Prot[eacute]g[eacute] programs will afford small 
and disadvantaged business opportunities to develop their capacity and 
competencies. Review and analysis of existing Mentor-
Prot[eacute]g[eacute] programs in the private and public sector 
conclude that they are effective against the problems related to small 
business and minority sub-contracting.
    This program is similar to those established by other federal 
agencies such as the Department of State, Department of Energy and the 
Environmental Protection Agency. An assessment of the best practices in 
Mentor-Prot[eacute]g[eacute] programs identified certain clear benefits 
for all parties involved. A successful Program can enable USAID to 
receive a lower price offer from less expensive Mentor-
Prot[eacute]g[eacute] teams. USAID acknowledges that a structured 
Mentor-Prot[eacute]g[eacute] Program provides an opportunity for dual 
benefits where small and disadvantaged business are developed to become 
prime contractors and technically capable sub-contractors. More 
importantly, the Program provides a degree of confidence to Program 
Officers that the Mentor firm stands behind the work of the 
Prot[eacute]g[eacute] firm. Therefore, risks associated with the 
performance of the small and disadvantaged business are mitigated.

II. Section-by-Section Analysis

    This rulemaking proposes to add a new Subpart 273 and amend Part 
719 of the AIDAR to provide a Mentor-Prot[eacute]g[eacute] Program that 
assists qualified small business to receive developmental assistance 
from USAID prime contractors in order to increase the base of small 
business eligible to perform on USAID grants, contracts and 
subcontracts.
    Proposed sections 719.273-2 and 719.273-4 define which types of 
entities are eligible to participate as Prot[eacute]g[eacute] in the 
Program. Those entities would

[[Page 67519]]

include Historically Black Colleges and Universities and other minority 
institutions of higher learning in addition to 8(a) firms, other small 
disadvantaged business, and women-owned small business. Proposed 
section 719.273-3 provides the USAID's Mentor-Prot[eacute]g[eacute] 
Program policy. Costs incurred by a Mentor to provide developmental 
assistance are not chargeable to the contract but can be used to offset 
subcontract goals to the extent that they are incurred during the 
performance of a contract identified in the Mentor-
Prot[eacute]g[eacute] Agreement, and have not been credited or 
reimbursed by the Government. This is an exception to the general rule 
that USAID will not reimburse Mentors for providing developmental 
assistance to Prot[eacute]g[eacute]s, which is set out in proposed 
section 719.273-3(b). Proposed section 719.273-4 outlines requirements 
for Mentor eligibility.
    Proposed section 719.273-3 states the incentives for Mentoring 
firms. Proposed section 719.273-4 outlines Prot[eacute]g[eacute] 
eligibility requirements. Proposed section 719.273-5 provides that 
selection of a Prot[eacute]g[eacute] is solely at the discretion of the 
proposed Mentor. Section 719.273-6 describes the process by which USAID 
contractors may seek to participate in this program as Mentors.
    Proposed section 719.273-7 provides the minimum requirements of a 
proposed Mentor-Prot[eacute]g[eacute] agreement. Proposed section 
719.273-8 describes forms of developmental assistance. Proposed section 
719.273-7 describes the review process leading to USAID's approval of a 
proposed Mentor-Prot[eacute]g[eacute] agreement. Proposed section 
719.273-10 describes the various reports that this program requires. 
Proposed section 719.273-11 provides for the inclusion of a provision 
discussing the Mentor-Prot[eacute]g[eacute] program in all 
solicitations exceeding $550,000 ($1,000,000 for construction) that 
offer subcontracting opportunities. Proposed section 752.219-XX 
provides for the inclusion of a provision discussing the establishment 
of the Mentor-Prot[eacute]g[eacute] Program.

III. Procedural Requirements

A. Review Under Executive Order 12866

    This proposed rule 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 proposed 
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), 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 proposed 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. The entities 
to which this rulemaking would apply are large business and small 
business firms that receive a form of incentive for assuming the role 
of Mentor to 8(a) firms, other small disadvantaged business, small 
women-owned business, Historically Black Colleges and Universities, and 
other minority institutions of higher education. It is the expectation 
that at such time as this rule is finalized, those 
Prot[eacute]g[eacute] entities would directly benefit from the forms of 
Mentoring described in this proposed rule. USAID believes there would 
not be an adverse economic impact on small contractors or 
subcontractors, but requests comment from the public on other possible 
impacts this rule may have on small entities. Comments will be used as 
a factual basis upon which USAID would certify that this rule will not 
have a significant economic impact on a substantial number of small 
entities.

D. Review Under the Paperwork Reduction Act

    This proposed rule would require USAID contractors serving as 
Mentors to submit an application (see proposed Sec. 719.273-7) and 
annual progress reports to the USAID Mentor-Prot[eacute]g[eacute] 
Program Manager at USAID Headquarters (see proposed Sec. 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. The proposed collection 
of information has been submitted to the Office of Management and 
Budget for review and approval under the Paperwork Reduction Act, 44 
U.S.C. 3501, et seq. USAID estimates the number of respondent Mentor 
firms to be 30 and the number of hours required for recordkeeping and 
preparation of the reports to be approximately 12 hours per respondent 
annually. The total annual burden hour from compliance is expected to 
be 360 hours (30 x 12 hours per year). The collection of information 
contained in this proposed rule is considered the least burdensome for 
meeting the requirements and objectives of the USAID Mentor-
Prot[eacute]g[eacute] Program.
    USAID invites public comments concerning: (1) The need for the 
reporting requirement; (2) the accuracy of USAID's estimate of the 
reporting burden; (3) ways to enhance the quality, utility, and clarity 
of the information to be collected; and (4) ways to minimize the burden 
of the collection of information on respondents. Send comments 
regarding this proposed collection of information to the contact 
persons named in the address section of this notice.

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

[[Page 67520]]

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. 
This proposed rule merely describes the USAID Mentor-
Prot[eacute]g[eacute] Program. 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 
proposed 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 proposed 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.
    For the reasons set out in the preamble, USAID proposes to amend 48 
CFR chapter 7 as set forth below:

PART 719--SMALL BUSINESS PROGRAMS

    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.

    2. A new subpart 719.273 is added as follows:
Subpart 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.

Subpart 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 
motivate and encourage firms and institutions of higher education to 
provide business development assistance to small business and 
institutions of higher of higher education in the United States that 
either historically or currently have ethnic minority student 
enrollments of more than 25 percent. These institutions are commonly 
known as Minority Institutions or referred to in this document as 
Minority Serving Institutions (MSIs). The term ``small business'' 
includes small business, small disadvantaged business certified by the 
Small Business Administration under Section 8(a) of the Small Business 
Act, women-owned small business, HUBZone small business, veteran-owned 
small business, and service-disabled veteran-owned small business. 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 between institutions of higher 
education with MSIs, and increasing the overall number of small 
business and MSIs that receive USAID contract and subcontract awards. 
For purposes of the Small Business Act, a Prot[eacute]g[eacute] firm is 
not considered an affiliate of a Mentor firm solely because the 
Prot[eacute]g[eacute] firm is receiving developmental assistance from 
said Mentor firm under the Program. 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. Mentors may have multiple Prot[eacute]g[eacute]s. 
However, USAID reserves the right to limit the total number of 
Prot[eacute]g[eacute]s participating under the Mentor-
Prot[eacute]g[eacute] Program.


719.273-2  Definitions.

    (a) Throughout, the term ``small business'' includes all categories 
of small firms on whose behalf OSDBU is chartered to advocate, 
including small business, small and 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 FAR 2.101.
    (b) The term ``MSIs'' applies to Historically Black Colleges and 
Universities (HBCUs), Hispanic Serving Institutions (HSIs) and Tribal 
Colleges and Universities (TCUs). Here the term is used interchangeably 
with the term Minority Institution as defined in FAR 2.101.
    (c) 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]. An institution of higher education may also 
enter into Mentor-Prot[eacute]g[eacute] Agreement as a Mentor with a 
small business or a MSI Prot[eacute]g[eacute].
    (d) ``Program'' refers to the USAID Mentor-Prot[eacute]g[eacute] 
Program as described in this Chapter.
    (e) ``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. A MSI can also 
enter into a Mentor-Prot[eacute]g[eacute] Arrangement with a business 
entity.


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 below in 719.273-8 can be used to offset established sub-
contracting requirements, to the extent that those costs are incurred 
during the performance of a contract identified in the Mentor-
Prot[eacute]g[eacute] Agreement, and have not been previously credited 
or reimbursed by the Government.
    (c) In addition to paragraph (b) of this section, 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

[[Page 67521]]

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 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 USAID.
    (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. (1) A Prot[eacute]g[eacute]:
    (i) Must be a small business, HUBZone, small disadvantaged 
business, women-owned small business, veteran-owned small business, 
small disadvantaged veteran-owned small business (as those terms are 
defined in FAR 2.101) or a Minority Serving Institution (MSI) (as 
defined in 719.273-2);
    (ii) Must be small as determined by NAICS code for the services or 
supplies to be provided by the Prot[eacute]g[eacute] to the Mentor; and
    (iii) Eligible for award of government contracts.
    (2) A Prot[eacute]g[eacute] firm may self-certify to a Mentor firm 
that it meets the requirements set forth in paragraph (b) of this 
section. Mentors may rely in good faith on written representations by 
potential Prot[eacute]g[eacute]s that they meet the specified 
eligibility requirements. Small disadvantaged business status 
eligibility and documentation requirements are determined according to 
FAR 19.304. HUBZone status eligibility and documentation requirements 
are determined according to FAR 19.1303.
    (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.


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 MSIs and small business including small business, 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, 
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 XXXX (OMB Approval number xxxx----). 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.
    (1) If the Mentor responding to a solicitation wishes to receive 
credit for an approved program arrangement, then

[[Page 67522]]

the contracting officer must add the approved Mentor-
Prot[eacute]g[eacute] Agreement to the subcontracting plan of any 
affected contract. OSDBU will notify the contracting officer of any 
changes to the Agreement, particularly if either party terminates the 
Agreement or OSDBU rescinds its approval of the Agreement per section 
719.273-10.
    (2) 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. Mentors required to submit Small Business Subcontracting 
Plan reports (in accordance with FAR 52.219-9) may submit the Mentor-
Prot[eacute]g[eacute] reports as part of their subcontracting reporting 
obligations. 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; and
    (3) Reviewing and evaluating financial reports and invoices 
submitted by the Mentor to verify that USAID is not charged by the 
Mentor for providing developmental assistance to the 
Prot[eacute]g[eacute].
    (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

    3. The authority citation for part 752 continues to read as 
follows:

    Authority: Sec. 621, Pub. L. 87-195, 75 Stat. 445, (22 U.S.C. 
2381) as amended; E.O. 12163, Sept. 29, 1979, 44 FR 566673; 3 CFR, 
1979 Comp., p. 435.

    4. Add section 752.219-270 to read as follows:


752.219-270  USAID Mentor-Prot[eacute]g[eacute] Program (XXXX 2007)

    As prescribed in AIDAR 719.273-11(a), insert the following 
provision:

USAID Mentor-Prot[eacute]g[eacute] Program

    (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 can be either small business, as defined 
in 13 CFR Parts 121, 124, and 126 or MSIs.
    (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. Firms interested in participating in 
the Program are encouraged to contact the USAID OSDBU (202-712-1500) 
for more information.

    (End of provision)
    5. Add section 752.219-271 to read as follows:


752.219-71  Mentor Requirements and Evaluation (XXXX 2007)

    As prescribed in AIDAR 719.273-11(b), insert the following clause:

Mentor Requirements and Evaluation

    (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)


[[Page 67523]]


    Dated: November 9, 2006.
Marilyn Marton,
Director, Office of Small and Disadvantaged Business Utilization 
(OSDBU).
[FR Doc. E6-19707 Filed 11-21-06; 8:45 am]
BILLING CODE 6116-01-P