Written Testimony before Senate Appropriations Subcommittee on State, Foreign Operations and Related Programs for FY 2018

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Presented by Michael Deal, President and CEO
Volunteers for Economic Growth Alliance
Written Testimony before Senate Appropriations Subcommittee on State, Foreign Operations, and Related Programs for FY 2018
Regarding State, USAID and Prioritizing Highly Skilled Volunteers in Effective Foreign Assistance

June 2, 2017

Thank you, Chairman Lindsey Graham, Ranking Member Patrick Leahy and Members of the Subcommittee on State, Foreign Operations, and Related Programs, for the opportunity to offer our views on U.S. foreign affairs priorities. On behalf of our 29 Member NGOs representing millions of Americans,[1] the Volunteers for Economic Growth Alliance (VEGA) urges you to maintain robust funding for the International Affairs Budget, especially for the U.S. Agency for International Development (USAID). VEGA supports your efforts to make foreign assistance more effective and to put economic growth and private sector engagement at the forefront of U.S. global development policy. Importantly, we also respectfully request the Subcommittee’s assistance to ensure the continuation of a successful USAID initiative that is set to expire on June 10, 2017. Notably, continuing this initiative in partnership with VEGA does not require any appropriation. We look forward to working with you to ensure that USAID Field Missions around the globe can continue to take advantage of the cost-savings and expertise of highly skilled volunteers who not only generate economic growth, stability and opportunities for trade, but also convey the best of American values and ingenuity.

First, let me begin by saying that we are alarmed by the extreme and dangerous proposed cuts for humanitarian aid, development work and UN support. The president’s budget proposes to cut funding for the State Department and USAID by more than 33%. Many of the crises our nation faces today cannot be adequately addressed with military solutions alone. In fact, our military leaders are the first to say that we must use all the tools of national power—development, diplomacy and defense—to confront these complex challenges.[2] As you well know, foreign assistance was actually less than 1% of the FY16 budget, despite being essential to America’s global leadership and national security. Severe cuts here do close to nothing to reduce the deficit, but they dramatically reduce our global and national security, and reliably increase human suffering—from countering ISIS to mitigating the next pandemic to ending hunger to competing with China. As members of InterAction and the U.S. Global Leadership Coalition, we join the bipartisan community of national security and foreign policy leaders in urging you to maintain FY16 spending and oppose cuts to the International Affairs Budget in FY18.

Now, we request your assistance with an especially effective initiative that engages the generous skills and spirit of the American people in U.S. global development efforts. In response to President George W. Bush’s Volunteers for Prosperity Executive Order in 2003,[3] USAID prioritized incorporating highly skilled American volunteers into economic growth programs connected to broader U.S. foreign assistance goals. A small group of NGOs formed a consortium to answer the call for international service and formed VEGA. Since then, through a uniquely competitive Leader with Associate Award (LWA), this consortium has grown to include 29 Member NGOs with networks of more than 100,000 highly skilled volunteers whose expertise spans the spectrum of technical assistance needed for economic growth programs worldwide—including financial services, engineering and infrastructure, enterprise development, local capacity building, farming and agriculture, water and sanitation, power and much more. VEGA Members provide a pipeline of highly skilled volunteers whose ordinary daily rates often would far exceed the maximum permitted. These volunteers create peer-to-peer mentoring relationships, thereby strengthening cross-cultural partnerships, local capacity and sustainability.[4]

During these uncertain budgetary times, the VEGA LWA delivers real savings to significantly stretch the taxpayer dollar. VEGA has partnered with the U.S. government on 59 programs in 47 countries, saving more than $32 million taxpayer dollars and nearly doubling the program value through cost share and leverage, including at least 44,000 days of volunteer service. This does not include the thousands of hours of administration and oversight VEGA saves USAID. The VEGA LWA allows USAID Field Missions to significantly stretch their limited budgets.

Notably, the uniquely competitive VEGA LWA allows USAID to get the very best programming and technical assistance our volunteer-sending NGOs have to offer through an independently competed process that also allows full-scale economic growth programs to get up and running three times faster than the average USAID procurement process. The VEGA approach adds more competition, transparency, oversight and accountability than other similar funding models, while not sacrificing flexibility and results.

However, this USAID success story will end unless it is renewed before June 10, 2017. Senator John Boozman, Ranking Member Patrick Leahy and Senator Johnny Isakson have joined VEGA Members in urging Acting Administrator Wade Warren to extend the VEGA partnership with USAID.[5] [6]  As the Senators noted, the justifications cited by USAID Administrator Raj Shah for extending the VEGA LWA three years ago are even more compelling today. Administrator Shah’s memo stated that “the VEGA program is strategically necessary” and that extending the VEGA LWA and increasing the ceiling “is in the best interest of USAID because the volunteer consortium is unique to the Agency, supports many small U.S. businesses, and provides a nimble response to global development needs. The incumbent organization was established specifically to meet USAID’s objectives for this initiative.”[7]

The incoming USAID Administrator deserves to inherit the best tools and opportunities for delivering effective foreign assistance while programs are reviewed and priorities are identified. Importantly, an extension—short or long-term—and raising the ceiling do not require any budget commitment, nor does it require or amount to priority setting by the Acting Administrator. This is an extension of a mechanism—not an appropriated program. Unlike other organizations, VEGA requires no budget outlay for core support to manage its LWA—a true bargain for the U.S. government and taxpayers.

To be clear, VEGA welcomes a new competition for a mechanism to incorporate highly skilled volunteers into global development programs. If there is a new competition for a program for USAID to partner with NGOs to incorporate highly skilled volunteers, VEGA (as the largest and only such consortium of its kind) will be extremely competitive, bringing deep experience, proven results, best practices and innovation for enhancing the role of highly skilled volunteers.

However, unless USAID extends the VEGA LWA now while a new competition is prepared, USAID Field Missions around the globe will be left for months—or potentially years—without a way to efficiently and effectively partner with NGOs to incorporate highly skilled volunteers into their programs, despite the demonstrated high demand for this through the VEGA LWA.

Without the VEGA LWA, USAID’s access to skilled volunteers will atrophy. Apart from the Farmer-to-Farmer Program, which is focused on food security alone, VEGA’s LWA is the only viable vehicle for USAID to integrate skilled volunteers into its programs. For non-LWA cooperative agreements, USAID regulations only permit Missions to encourage cost share, they cannot require it.  Nor can Missions specify how they would like cost share to be generated, e.g., expressing a preference for volunteers.  In practice, VEGA Member NGOs working under non-VEGA cooperative agreements rarely, if at all, incorporate substantial cost share and they do not utilize volunteers as a general rule in meeting what cost share commitments are made.  Without access to the VEGA LWA, member NGOs have stated that they would have little or no incentive to maintain active volunteer databases and employ specialized staff to recruit, orient and otherwise support and report upon skilled volunteers.  The message is clear, without vehicles like VEGA’s LWA, the USG will quickly lose its capacity to actively integrate skilled volunteers into its economic growth programs.

Over the past few years, VEGA has significantly increased its emphasis on skilled volunteers through our programming, working closely with USAID to ensure the maximum amount of value-added through volunteer participation. VEGA now requires at least a 30% level of effort from skilled volunteers on all programs, which boosts the pro bono value of our economic growth programs. To date, VEGA has nearly doubled the participation of volunteers from the original levels proposed.

VEGA also is proud to have supported bipartisan efforts to make foreign assistance more efficient, effective and accountable—and we are proud to be an example. VEGA partners with USAID on Feed the Future and Power Africa, which are two examples of these reforms at work. VEGA also welcomes the Caucus on Effective Foreign Assistance, as well as legislation and appropriations to achieve even more modernization.[8] In fact, VEGA embodies key principals of modern effective assistance:

• Ensuring transparency and rigorous monitoring and evaluation—VEGA is an extra set of eyes, providing USAID with rigorous monitoring, oversight and evaluation of the programs implemented by VEGA Members. VEGA uses robust indicators to measure impact specific to programs and overarching Mission and USAID goals. Also, VEGA has developed a reporting system and evaluation of the value of volunteer assignments.

• Prioritizing country engagement—VEGA programs are demand-driven and ultimately determined by and funded through USAID Bureaus and Field Missions. American volunteers share their experience, ingenuity and skills with local partners to solve specific locally identified problems together.

• Focusing on innovative solutions—VEGA brings diverse partners together who send pro bono experts in the fields of science, engineering, finance, agriculture, technology and more. VEGA continues to expand and diversify its membership and USAID’s opportunities for partnership and innovation. Just since the last extension three years ago, VEGA has added 13 new Members, including Purdue University, World Council of Credit Unions, National Rural Electric Cooperative Association International and Engineers Without Borders USA. In fact, there is no limit to the number of non-profit volunteer-sending organizations that can join VEGA to partner with USAID.

• Leveraging the private sector—VEGA provides USAID with opportunities for greater engagement with the private sector. VEGA’s network of highly skilled volunteers represents a wide range of sectors that are increasingly looking to work with the U.S. government to promote economic growth in the developing world. Not only do most VEGA volunteers bring their private sector expertise to USAID programs, but VEGA also has a newly formed public-private partnership which aims to incorporate the best practices and make it a model for future engagements.

Indeed, VEGA has been a reliable partner for USAID with proven results and has consistently evolved as the Agency’s initiatives and needs have changed over the years. If given the opportunity, VEGA and its network of more than 100,000 skilled volunteers can bring to bear significant cost savings and innovation for effective economic growth prioritized by the Trump administration and Congress. Therefore, we respectfully request that you strongly urge USAID to move swiftly to address the high demand from Field Missions by extending the VEGA LWA and lifting the ceiling, and then working with us to develop the next generation of this successful initiative so that this efficient, effective and accountable funding mechanism and VEGA can continue to engage and serve the American people and partners around the globe.

[1] VEGA Members: Aquaculture without Frontiers (AwF), Arizona State University Walton Sustainability Solutions Initiatives, Australian Volunteers International (AVI), BizCorps, Coffee Quality Institute (CQI), Creative Learning/Aid to Artisans, Cultivating New Frontiers in Agriculture (CNFA), Engineers Without Borders USA (EWB-USA), Financial Services Volunteer Corps (FSVC), Florida Association for Volunteer Action in the Caribbean and the Americas, Inc. (FAVACA), Foods Resource Bank (FRB), Global Business School Network (GBSN), Global Communities, Institute of International Education (IIE), International City/County Management Association (ICMA), International Executive Service Corps (IESC), International Real Property Foundation (IRPF), International Senior Lawyers Project (ISLP), Land O’Lakes International Development Division, Mennonite Economic Development Associates (MEDA), National Cooperative Business Association CLUSA International (NCBA CLUSA), National Rural Electric Cooperative Association (NRECA International), Opportunity Industrialization Centers International (OIC International), PUM Netherlands Senior Experts, Purdue University, PYXERA Global, Winrock International, Worldwide Foundation for Credit Unions, Inc. (WOCCU), World University Service of Canada (WUSC).

[2] Letter from over 120 retired generals, admirals to congressional leaders sent 2/27/2017, http://www.usglc.org/downloads/2017/02/FY18_International_Affairs_Budget_House_Senate.pdf.

[3] Volunteers for Prosperity, Executive Order 13317 (September 25, 2003), https://www.gpo.gov/fdsys/pkg/CFR-2004-title3-vol1/pdf/CFR-2004-title3-vol1-eo13317.pdf.

[4] See several success stories at VolunteerImpact360.org.

[5] Letter from Senators Boozman, Leahy and Isakson to USAID Acting Administrator Wade Warren, April 13, 2017, http://vegaalliance.org/wp-content/uploads/2017/04/4-13-17-Letter-to-USAID-re-VEGA.pdf

[6] Letter from VEGA Member NGO to Acting Administrator Wade Warren sent on 3/14/2017, http://vegaalliance.org/vega-members-support-letter-to-usaid-acting-administrator-wade-warren/.

[7] Action Memo for the Administrator, Subject: Justification for the Exception to Competition—Volunteers for Economic Growth Alliance (VEGA) VEGA Leader with Associates award (LWA), signed by USAID Administrator Raj Shah on June 20, 2014.

[8] VEGA Press Release, “Economic Growth a Priority for Global Development for Bipartisan Members of Congress and Trump Administration,” May 26, 2017, http://vegaalliance.org/press-release-economic-growth-a-priority-for-global-development-for-bipartisan-members-of-congress-and-trump-administration/.