March 01, 2017 Public Contract Law Journal

Cooperative Agreements & Foreign Aid: Examining USAID's Involvement in the Afghanistan Reconstruction Effort

by Kelsey O'Brien

Kelsey O’Brien (kmobrien@law.gwu.edu) is a J.D. candidate at The George Washington University Law School and the Editor-in-Chief of the Public Contract Law Journal. She wishes to thank Judge Jeri Somers, Bryan Byrd, Professor Christopher Yukins, Scott Sheffler, and Brittany Finder for their support and guidance during the Note-writing process.

I.  Introduction

Following a tense and tumultuous thirteen-year war in Afghanistan, the United States Agency for International Development (USAID or Agency) stepped up to provide foreign aid and reconstruction assistance to the wartorn nation. To carry out this public purpose, USAID entered into cooperative agreements with established implementing partners. Despite limited progress, the Afghanistan reconstruction effort largely resulted in allegations of waste, fraud, and abuse. Responding to allegations in the media and demands for accountability, USAID took action — suspending two of its largest and well-established implementing partners — without much explanation.

This Note explores the problems USAID experienced using cooperative agreements to implement foreign assistance programs in Afghanistan.1 Part II discusses different federal funding agreements, what it means for an agency to be “substantially involved” in implementing cooperative agreements, nonprocurement debarment and suspension, and USAID’s current contracting regime. Part III looks specifically at USAID’s use of cooperative agreements in the Afghanistan reconstruction projects from 2001 to 2013, the Agency’s major implementing partners, and how “substantially involved” USAID was in the projects. Next, Part IV discusses two specific Afghanistan aid programs, what went wrong, and the results. Finally, Part V suggests amending the U.S. Code of Federal Regulations (CFR) to include descriptive guidance and requirements on an agency’s “substantial involvement.”

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