USAID COVID-19 Contract Spending Analysis

Published: June 11, 2020

Federal Market AnalysisUSAIDContract AwardsCoronavirus (COVID-19) PandemicSpending Trends

The U.S. Agency for International Development has spent more than $118 million to date for COVID-19 response activities.

Key Takeaways

  • The U.S. Agency for International Development has spent more than $118 million to date for COVID-19 response contracts, more than 70% of which were awarded in May.
  • More than 90% of USAID’s contract dollars have been for Professional Services contracts and dominated by two companies with contacts aimed at assisting USAID in their operations and program effectiveness during the pandemic response. Information Technology needs make up just under $9 million of the $118 million, or less than 8%.
  • Less than 3% of the $118 million in USAID obligations have gone to small business set-asides or other preference programs.

U.S. Agency for International Development COVID-19 Contract Spending

Under federal acquisition rules set for the COVID-19 pandemic response, contracted coronavirus response activities using the CARES Act and other stimulus funds are required to be flagged under the COVID-19 National Interest Action (NIA) in the Federal Procurement Data System (FPDS). This allows some visibility and oversight into how federal response dollars are being spent.

Looking at what the U.S. Agency for International Development (USAID) has reported for their contract obligations to date gives an indication of the rate of acquisitions, what kinds of contracts they have awarded, for what goods and services and with which companies. 

To date, USAID has obligated over $118 million over the last few months, with nearly 30% coming in April and more than 70% falling in May, which was only the second full month of COVID-19 contracting so far under the NIA. (See chart below.)

Identifying the Primary Requirement for these contracts – the main type(s) of products and/or services being procured – the contract obligation data shows that USAID has been focusing more than 90% of their COVID-19 spending to date on Professional Services contracts, with the next largest category being Information Technology at almost 8%. The remaining 2% are spread across Electric & Electronic Components & Parts; Purchase or Lease of Facilities & Equipment; and Research & Development services. (See chart below.)

Digging a bit deeper into the most frequently used Product Service Codes (PSC) reported for USAID contract obligations so far reveals that the data aligns very well to the Primary Requirement areas shown above. The top two PSCs for Professional Services account for nearly 90% of USAID’s obligations to date. The next top three PSCs are IT-related and account for $8.3 million, or 7% of contract dollars so far. The remaining five account for another $4 million or 3.5%, resulting in the top ten PSCs covering 99% of USAID’s obligations through June 8. (See chart below.)

Similar to how the kinds of services and goods that have been procured to date are very concentrated, these contract dollars are highly concentrated among a handful of awardees, with the top two firms accounting for more than 75% of contract dollars to date. The top five companies make up nearly 90%. Palladium International alone accounts for more than $49 million (42%) of the $118 million USAID has awarded. The remaining five at the bottom of the “top 10” account for about $7.5 million or 6.3% of award dollars to date, with the remaining 30 firms that have been awarded contracts in the Other grouping accounting for $7 million or 6%. (See chart below.)

The Professional Services contracts awarded to Palladium and DAI Global center around PSC R499, Other Professional Support aimed at assisting USAID in their operations and program effectiveness during the pandemic response.

The Place of Performance (POP) where USAID has been spending its COVID-19-related dollars is fairly well concentrated in the Washington, DC region, with the District, Maryland and Virginia accounting for more than 85% of obligated dollars so far. This makes sense given the types of Professional Services contracts that make up the bulk of their spending. The Outside the Continental U.S. (OCONUS) category denotes an aggregate of all overseas locations and represents 14% of the contract obligations to date. (See chart below.)

Delving further into these OCONUS locations shows that nearly half of the contract obligations for work performed outside of the U.S. occurred in the top two locations of South Africa and Uganda. The remaining five identified locations account for $6.7 million and nearly 6%. Locations that were Not Reported but still OCONUS account for 12%. (See chart below.)

Where Preference Programs and set-asides to small businesses are concerned, USAID has awarded less than 3% of their contract dollars via Small Business Set Asides and other Preference Program types. Nearly 90% of the $118 million in obligations involved no set-asides. See chart below.)

As the federal pandemic response appears to be plateauing in the U.S. there may continue to be sustained efforts across the globe for which USAID may be called upon to support and provide assistance. Ongoing contractor support may continue to be needed and reflect areas of operational and technical need at the agency.