VZCZCXRO5297
PP RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #4123/01 3530410
ZNR UUUUU ZZH
P 190410Z DEC 07
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC PRIORITY 4938
INFO RUCNRAQ/IRAQ COLLECTIVE

UNCLAS SECTION 01 OF 02 BAGHDAD 004123 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAID PREL IZ
SUBJECT: IMPROVING USG BUDGET EXECUTION IN IRAQ 
 
¶1. SUMMARY: We are seeking ways to improve the delivery of programs 
inside Iraq with resultant increase of US budget execution. Dramatic 
improvements may be difficult to come by, but we have 
recommendations to offer that would not only promote funds 
disbursement, but also improve Iraqi involvement and decrease time 
of program delivery. END SUMMARY. 
 
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Current Challenges in the PRDC Program 
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¶2. Procurement and management teams throughout Iraq are challenged 
to handle the volume of contracting and project oversight required 
for assistance programs. In the Provincial Reconstruction 
Development Committee (PRDC) program alone, over 180 projects have 
been initiated with FY-06 funds and the program will grow by 33% 
with the addition of FY-07 funds received in September. Thus the 
PRDC program will be nearly an $800M program, consisting of smaller 
scale ($1-2M) projects. DOD project development teams are pushing to 
ensure all funds are awarded on contract, but demands on project 
management and technical staff required to properly execute this 
program is significant. Greater flexibility in our approach to 
service procurement and delivery is needed. 
 
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Possible Solutions or Improvements 
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¶3. Using streamlined acquisition procedures with programs being 
executed by USACE/GRD for the DoS will minimize the time and 
resources in contracting for PRDC projects. Limiting the number of 
sources from which bids or proposals are solicited and in justified 
circumstances authorizing single source awards will minimize the 
time consumed by the award process. Current authorities held by GRD 
permit use of limited competition in the acquisition process and may 
be used in this program. A similar approach is presently employed in 
several other DOD programs - CERP and the Iraq Freedom Fund. 
 
¶4. Grants and cooperative agreements can provide greater flexibility 
to apply the funds where needed and to create effective 
partnerships. These programs would benefit with the ability to enter 
into grant agreements with both non-governmental organizations as 
well as government organizations. Grants with international 
organizations or donors offer the possibility of matching 
contributions that will serve as a multiplier of funds available. 
The permission to forge agreements with both national and provincial 
governments will not only promote enhanced budget execution, but 
also encourage Iraqis to underwrite these investments with their own 
funds. 
 
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Additional Benefits from Changed Procedures 
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¶5. Opening our contracting procedures and selection process should 
also permit greater Iraqi participation in the contract award 
process.  Current procedures and procurement sensitivities often 
preclude Iraqis from sitting on contract selection panels or even 
observing. This lack of transparency can foster mistrust and does 
not build Iraqi confidence in our contracting process.  We are 
missing a capacity building opportunity. Our process should solicit 
Iraqi viewpoints and encourage, where possible, their active 
participation. 
 
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Enhancement of Current Grant Programs: TDP & QRF 
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¶6. Our execution of dedicated grant programs - Targeted Development 
Program (TDP) and Quick Reaction Fund (QRF) would be enhanced with 
the placement in the Mission of a "Grant Specialist" with the 
experience and sufficient warrant capacity to issue grants in 
support of these programs. As the upfront identification of 
qualified award submissions can be all preformed in advance of grant 
issuance. This specialist would not necessarily have to be on a full 
time basis, a rotational, temporary presence would be sufficient. 
 
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Comment 
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¶7. These requests for assistance are largely 
procedural/administrative in nature and do not require large amounts 
of dollars and/or manpower, but will aid us in the implementation of 
programs. This type of assistance not only will lead to improved 
budget execution, but will also ensure that Iraqi's see that the US 
can deliver on promises. Resources will be more readily brought to 
bear on approved efforts in a timely manner. 
 
¶8. Granting of these authorities will not necessarily result in all 
projects utilizing streamlined procedures, or that grants will be 
universally applied. Ensuring that the work is placed with qualified 
and capable contractors will remain the preeminent concern for both 
 
BAGHDAD 00004123  002 OF 002 
 
 
contract and grant award. A competitive process may be determined to 
be the most advantageous method to determine the best qualified 
vendor.  The streamlined contracting procedures and grants awards 
will be additional, more flexible tools that PRT's and district 
engineers can employ. 
 
Crocker