The Foreign Service Journal, April 2004

officers just find it easier to work with big firms with whom they are familiar, Berrios points out. Marshall says USAID has taken steps to correct this problem by eliminating a requirement that agency contracting officers give added weight to a contractor’s past performance for the agency. “We’ve leveled the playing field by eliminating USAID-specific past performance as a requirement. We’re looking at past performance for any and all customers, includ- ing USAID.” Marshall has also acted to broaden the base of organizations that do busi- ness with USAID by, among other things, simplifying the bidding process and reducing the number of differ- ent contract models the agency uses. But throughout the 1990s, as USAID was wasting some $100 million on the failed financial management system update, agency managers overseeing contracts could not see how much contractors had spent, or how close they were to exhausting the appropriated fund- ing. Natsios, to his credit, began last year to imple- ment a new system, and for the first time ever, USAID’s inspector general gave the agency a clean financial audit in 2003. Rebuilding on the Fly To be sure, the invasions of Iraq and Afghanistan have revealed the agency’s weaknesses. With so few Foreign Service officers, the agency lacks what Marshall calls a “surge capacity” to respond quickly to emergencies or unexpected situations around the world. At a House Appropriations Committee hearing last September, Natsios testified that USAID simply couldn’t let billions in new contracts without an increase in its operational budget. In the last two years, with major programs in Iraq and Afghanistan, Congress has boosted the agency’s program budget by more than 50 percent from $7.3 billion in 2001 to over $14.1 billion last year. But at the same time, Congress gave the agency only an 11-percent boost in its opera- tional budget. In testimony to the Senate Foreign Relations Committee on the Millennium Challenge Account in March 2003, then-AFSA President John Naland focused on the problem. “AFSA believes the personnel budget and staffing levels provided fall far short of real requirements and that the same workforce planning review that gave rise to the State Department’s seminal Diplo- matic Readiness Initiative is required at USAID,” Naland said. “USAID suffers staffing gaps, lacks a training float, and has too many categories of non-direct hire employees that seriously impact the work of the Foreign Service.” This year, Natsios finally got some help. With new funding, USAID plans to hire 40 Foreign Service offi- cers (above attrition) this year and 50 in 2005. A total of 700 Foreign Service officers currently work at all of USAID’s missions overseas, and the agency is ramping up recruitment efforts. Through a new “Development Readiness Initiative” modeled on State’s Diplomatic Readiness Initiative cited by Naland, the agency plans to hire junior staff to “assure a continuous pipeline of talent into our system.” In addition, the agency has begun to compile rosters of experienced personal ser- vice contractors and retired agency officers who have security clearances and are available for deployment on short notice. USAID’s personnel hiring system has been redesigned to make it easier to bring new people on quickly; the goal is to cut the time needed to bring on a new hire from about seven months to 28 days. Natsios has also implemented a standard procurement curriculum to train the agency’s contracting officers and program staff. The training, according to one agency official, is “a huge undertaking” that “reflects the new thinking that the procurement and grants process is the responsibility not only of contracting officers and their staffs but of the whole agency.” Marshall, meanwhile, has formed a Business Transformation Executive Committee through which he and other top USAID officials meet regularly to discuss management reforms. Marshall has also met regularly with representatives of both the contracting and F O C U S 38 F O R E I G N S E R V I C E J O U R N A L / A P R I L 2 0 0 4 Through a new “Development Readiness Initiative,” USAID plans to hire junior staff to “assure a continuous pipeline of talent into our system.”