1.0    Introduction

2.0    Program Description

2.1    General
2.2    Terms and Conditions
2.3    Eligible Recipients
2.4    Repayability
2.5    AIF Level of Assistance
2.6    Intellectual Property
2.7    Environmental Assessment


3.0    Guidelines for Proposals
3.1    Request for Project Proposals (RFPP) Process
3.2    Proposal Content Guidelines
3.3    Support for Preparation of Proposals
3.4    Proposal Evaluation

(i)    Essential Eligibility Criteria
(ii)    Desirable Criteria


4.0    Evaluation Process
4.1    The Detailed Evaluation Stage
4.2    Scientific Review
4.3    Proponent Responsibilities
4.4    Project Approval
4.5    The Contract


5.0    Monitoring of Approved Projects
5.1    Statement of Work
5.2    Reporting Requirements
5.3    Success Indicators


6.0    Monitoring of Approved Projects
6.1    Other Federal Departments and Agencies


7.0    General Procedures

7.1    Language
7.2    Submission
7.3    Closing Date
7.4    Entries and Requests for Clarification
7.5    Rights of ACOA


Annex "A" - Terms and Conditions, Atlantic Innovation Fund Program
Annex "B" - Administration and Declaration Forms
Annex "C" - Guide for Preparation and Submission of Project Proposals
Annex "D" - Costs and Financing Templates
Annex "E" - Results Measurement Guide
Annex "F" - General Conditions (of Contribution Agreement)
Annex "G" - Statement of Work Guide
Annex "H" - List of ACOA Offices

2.0    Program Description

2.1    General

The AIF finances research and development and related initiatives, which are focussed in the areas of natural sciences; applied sciences; and social sciences and humanities where these are linked to the development of technology-based products, processes or services or their commercialization, and thereby strengthen the region's system of innovation. The AIF focuses on increasing research and development linked to economic development and commercialization in areas that are of strategic importance to the region, particularly those that support the growth of strategic sectors and clusters. Related initiatives emphasize building the Atlantic system of innovation, and encouraging synergies among the various components of this system through partnerships, alliances and networks.

2.2    Terms and Conditions

Attached as Annex "A" are the Terms and Conditions for the administration of the AIF program which provide definitions and details regarding the AIF program in addition to those set out below.

2.3    Eligible Recipients

ACOA encourages prospective stakeholders, including universities, colleges, research organizations, private sector firms and individuals, to take an active role in seeking out opportunities for joint ventures/collaboration under the AIF program. There may be important reasons for such organizations to build research capability and commercialization opportunities that match their respective interests. It is envisioned that projects will be developed through a collaborative process among private sector and institutional stakeholders. Such collaboration will maximize the economic benefits of the resources available under the AIF, and enhance commercialization success.

Partnerships in AIF projects are highly encouraged; however, such partnerships should add value and make a meaningful contribution to a project. Partnerships among research facilities, universities and the private sector, etc. could help to build capacity in areas of research that leads to economic growth and be a key determinant of success of an R&D; project. Partnership with the private sector is normally required to commercialize research. The private sector could be investors in a project, be partners in a project to commercialize the R&D; results, and/or participate on a project's steering committee - i.e., have a real stake in the project and its outcome(s). The private sector should also consider partnering with research institutions that could add value to their projects.

(NOTE: Proposed commercial projects seeking a contribution of $500,000 or less are not eligible for assistance under the Atlantic Innovation Fund. Such proposed commercial projects may be eligible for assistance under ACOA's Business Development Program.)

2.4    Repayability

The federal repayable contribution policy is based on the premise that when a business, as a result of a contribution from the Government of Canada, earns a profit or otherwise increases in value, the business should return the contribution to the government. Accordingly, contributions to the private sector that involve the commercialization of a technology, product, process or service will be conditionally repayable based on the commercial success of the project. Contributions to non commercial organizations will be non repayable. A private sector partner(s)/collaborator(s) in a non-commercial project, who stands to benefit from the non-repayable AIF contribution through commercialization of a resulting product, process or service, would be expected to pay a fee(s) or royalty(s) back to the non-commercial proponent.

2.5    AIF Level of Assistance

Contributions will be the least amount required to allow a project to proceed. AIF will provide assistance up to 75% of total eligible costs for commercial private sector projects. For projects undertaken by not-for-profit organizations, AIF assistance will normally be up to 80% of total eligible costs. Proponents should lever financing for their projects from other (non-ACOA) sources.

2.6    Intellectual Property

ACOA will not seek ownership of any intellectual property. Proponents must ensure that they have sufficient intellectual property rights in technology which has been developed prior to the beginning of the project and which will be required to permit the project to be carried out and to permit the intellectual property arising from the project to be exploited. The proponent must also ensure that they have made sufficient provisions in any agreements with employees, contractors, collaborators (partners), etc. to ensure they have sufficient rights to the intellectual property arising from the project to enable them to exploit/commercialize the intellectual property.

The university, college or research institute should have an intellectual property policy that encourages and supports the commercialization of R&D; in Atlantic Canada. Before the first disbursement can be made, a proponent must submit an intellectual property policy that is acceptable to ACOA.

2.7    Environmental Screening

All proposed AIF projects will be subject to appropriate environmental screening under the Canadian Environmental Assessment Act.

3.0    Guidelines for Proposals

3.1    Request for Project Proposals (RFPP) Process

AIF operates using a Request for Project Proposals (RFPP) process to seek project proposals. The RFPP process is a method of obtaining a pool of qualified projects to be considered for funding. The RFPP is not a contracting process and neither the proponent nor ACOA is legally bound as a result of the submission of a proposal under this process.

3.2    Proposal Content Requirements

Proposals must include:

• Administration and Declaration Forms (see Annex "B".)
• Project Proposal (see Annex "C".)
• Costs and Financing Templates (see Annex "D".)
• Results Measurement Information (see Annex "E".)

Proponents must submit a separate proposal for each stand-alone project to facilitate overall project evaluation by ACOA. A stand-alone project has a distinct scientific/technical basis for the development of a product, process or service that is technologically innovative and commercially viable. Stand-alone projects are not dependent on the success of other projects or activities. Where stand-alone projects are complementary (e.g., same proponent or same area of research, etc.) proponents should provide cross-references in each of their proposals to those projects. Where the proponent deems it necessary to group projects into one proposal, because of their strong interdependency, the proponent must include a rationale/justification in a covering letter and must ensure that all relevant sections of the proposal (per Annex "C") are completed for each project.

3.3    Support for Preparation of Proposals

The AIF will not provide any financial assistance for preparation and submission of project proposals.

3.4    Proposal Evaluation

Project proposals will be assessed against essential and desirable eligibility criteria.

(i)    Essential Eligibility Criteria

The following are essential criteria which must be met for consideration of project proposals under AIF. Each proposal must:

a)	be compatible with the AIF objectives;
b)	be scientifically and/or technically sound;
c)	demonstrate management capability to successfully undertake the project;
d)	demonstrate significant economic benefits for Atlantic Canada;
e)	address ultimate commercialization potential of project;
f)	support new or improved technologies or new applications of technologies;
g)	have adequate financing for the duration of the project;
h)	be incremental; and
i)	support one or more strategic sectors or technologies.

(ii)    Desirable Criteria

In addition to essential criteria, the following desirable criteria are key considerations in the evaluation of proposals under AIF:

a)	includes private sector participation (for institutional proposals);
b)	fills a gap in the Atlantic system of innovation;
c)	improves innovation capacity of the private sector;
d)	is pan-Atlantic in scope;
e)	builds critical mass through networks/cooperation of existing and/or additional talent (researchers);
f)	leverages funding from other public and private sector sources;
g)	attracts new firms, institutions and researchers to Atlantic Canada;
h)	builds on research excellence; and
i)	fosters national and international affiliations.

Proponents must address these criteria in sufficient detail, depth and clarity in their proposal to permit a complete analysis and assessment. Failure of a proponent to do so against at least the essential criteria will render a proposal non-compliant, and it will result in funding not being offered. This does not prevent a proponent from submitting further proposals during a later RFPP process.

Proponents are also advised to use the proposal content guidelines in Annex "C" to ensure that all criteria have been addressed, and that all requested information has been provided.

4.0    Evaluation Process

4.1    The Detailed Evaluation Stage

Prior to review by the AIF Advisory Board, ACOA will analyse project proposals against both essential and desirable criteria, to an appropriate degree commensurate with the size and complexity of proposed projects.

4.2    Scientific Review

ACOA may consult with or refer any proposal to external scientific experts to assist with project review/evaluation. The proponent's signature on the Declaration form in Annex "B" will constitute consent regarding sharing of information. Before a proposal is released to a scientific expert for project review/evaluation, the expert will be required to sign a confidentiality agreement with ACOA.

4.3    Proponents' Responsibilities

Proponents acknowledge and understand that they may be required to perform any or all of the following activities to assist ACOA in evaluating project proposals. Proponents further understand that the performance of any or all of the following in no way guarantees that their proposal will be approved by the Minister:

(a)	reviewing requirements identified in the RFPP, seeking clarifications, preparing and submitting proposals that provide all the information required, in accordance with all instructions of the RFPP; and,
(b)	providing clarifications as requested by ACOA, making personnel available for interviews by ACOA.

4.4    Project Approval

The AIF Advisory Board will review all AIF project proposals and provide advice on acceptance and funding to the Minister. Final decision-making authority for project approval rests with the Minister. The Minister reserves the right to accept or reject any proposal. Proposals may be approved in whole or in part. In the case of similar competing proposals, the Minister may encourage proponents to collaborate and/or may select one proposal only. Proponents of rejected proposals may have an opportunity to revise their proposal for submission to a future request for project proposals.

4.5    The Contract

The legal obligation of the parties will come into force only when a proponent enters into a project-specific Contribution Agreement with ACOA under the AIF. This agreement will define the investment from the Atlantic Innovation Fund, the level of support from other investors, and the roles and responsibilities of ACOA and the successful proponent. The General Conditions which would form part of the contract are set out in Annex "F".

5.0    Monitoring of Approved Projects

5.1    Statement of Work

Proponents, whose projects are selected for AIF funding, will be required to provide ACOA with a draft Statement of Work which will form part of a Contribution Agreement. Proponents should review the Statement of Work Guide, presented in Annex "G", prior to preparing their project proposal to ensure that a Statement of Work could easily be prepared from the information contained in their project proposal.

5.2    Reporting Requirements

Successful proponents will be required to provide quarterly progress reports to ACOA and to meet at least once a year with ACOA officials to review the progress of their project. In some cases, depending on the complexity of a project, a Project Review Committee may be established. This committee would be a formal multi-disciplinary monitoring committee comprised of an ACOA Account Manager(s), recognized technical expert(s), plus representatives of the Proponent and its key collaborator(s).

5.3    Success Indicators

The Government of Canada will evaluate the results of the AIF. Accordingly, recipients of AIF program funding will be expected to provide ACOA with data that will contribute to the evaluation of AIF's activities. Attached, in Annex "E", is a list of success indicators at both the project and proponent/partner levels. Proponents must provide information at the project level, and attach it as an appendix to their project proposal.

6.0    Other Government Programs

Some proposed projects may be eligible under other government programs and these should be considered prior to preparing a proposal for funding under the AIF. Indeed, one of the desirable criteria is to "leverage funding from other public and private sector sources". This includes all levels of government, the private sector, universities, associations and research facilities. This is a key consideration in the evaluation of proposals under the AIF program.

6.1    Other Federal Departments and Agencies

The Government of Canada offers other programs to promote research and development across Canada. These include, for example, the Canada Foundation for Innovation, the Natural Sciences and Engineering Research Council and the Social Sciences and Humanities Research Council. Certain commercial projects may be eligible for assistance under the National Research Council's Industrial Research Assistance Program, Industry Canada's Technology Partnerships Canada program, etc. ACOA can provide stakeholders with information on and coordinates for such programs.

7.0    General Procedures

7.1    Language

Proposals may be submitted in either of Canada's official languages, English or French.

7.2    Submission

Proponents must provide a Letter of Intent, of no more than three pages, as soon as possible after the issue of this Request for Project Proposals, but no later than September 30, 2002. It should be mailed to ACOA Head Office, Attention: Mr. Alan Miller, P. O. Box 6051, Moncton, N.B., E1C 9J8. This letter is required for planning purposes in order to improve the overall efficiency of the project evaluation process. Specifically, it will help the Agency to identify, at an early stage, potential expert scientific reviewers; the number and type of projects in specific sectors; and the resource requirements for review teams and account managers. The letter should include a general description of the research proposal including the project objectives; anticipated deliverables and challenges; sector of interest (for guidance, refer to Annex "B", section #5); estimated project costs; estimated amount to be requested from the AIF program; and the names and addresses of potential independent reviewers (for guidance, refer to Annex "B", section #15). This letter will not be used to pre-screen projects.

The project proposal may be submitted to the Atlantic Canada Opportunities Agency either on-line via the Internet or by courier or hand-delivery to either ACOA's Head Office or any of its regional offices. Please see Annex "C" for specific details.

ACOA will acknowledge receipt of all proposals. If sent electronically, ACOA will provide an on-screen electronic confirmation of receipt. Acknowledgement of ACOA's receipt of courier or hand-delivered proposals will be mailed from ACOA's AIF Secretariat to respective proponents. If confirmation is not received, a proponent must follow up with ACOA.

If a proposal is to be submitted on-line, proponents are asked to refer to the on-line instructions at http://www.acoa-apeca.gc.ca and select the link to AIF. To ensure confidentiality of transmission, a proposal submitted on-line will be by way of secure socket layer. A proposal submitted electronically is deemed to be sent from the proponent's principal place of business and will be received at ACOA's Head Office in Moncton, New Brunswick.

7.3     Closing Date

a)	Project proposals prepared in response to this RFPP of August 2002 must be received in their entirety by 4:00 p.m. local time on Wednesday, November 27, 2002, the closing date.
b)	Proposals will not be accepted after the closing date.
c)	ACOA will return proposals received after the stipulated project proposal solicitation closing date.
d)	Timely receipt and correct direction of a proposal is the responsibility of the proponent. ACOA will not assume or have transferred to it these responsibilities.

7.4     Enquiries and Requests for Clarification

Proponents are invited to telephone ACOA officials if there are any questions related to this RFPP or for advice in preparing proposals. Contacts are:

Mr. Kent Estabrooks at 1-800-561-4030 in Fredericton, New Brunswick;
Mr. Rob McDonald 1-800-565-1228 in Halifax, Nova Scotia;
Mr. Tom Plumridge at 1-800-705-3926 in Sydney, Nova Scotia;
Mr. Gerard Watts at 1-800-871-2596 in Charlottetown, Prince Edward Island;
Mr. Clayton Higdon at 1-800-668-1010 in St. John's, Newfoundland; or
Ms. Denise Frenette at 1-800-561-7862 at the AIF Secretariat in Moncton, New Brunswick.

7.5     Rights of ACOA

ACOA reserves the right to enter into negotiations with a proponent on any or all aspects of its proposal, and to cancel and/or reissue this RFPP at any time.

ANNEX A  -  Terms and Conditions

1.     Purpose

The purpose of this document is to set forth the terms and conditions for the administration of contributions under the Atlantic Innovation Fund Program.

2.     Definitions

"ACOA" and "Agency" means the Atlantic Canada Opportunities Agency.

"Minister" means the Minister responsible for the Atlantic Canada Opportunities Agency and may include the Minister of State for ACOA, as authorized by the Minister, and other persons as authorized by the Minister to act on his/her behalf.

"Fiscal Year" means the period commencing on April 1 of any year and terminating on March 31 of the immediately following year.

"Atlantic Investment Partnership" (AIP) means a $700-million, five-year federal initiative announced by the Prime Minister of Canada on June 29, 2000. The AIP is a mix of strategic investments and initiatives in innovation, trade and investment, entrepreneurship and skills development, and community economic development.

"Atlantic Innovation Fund" (AIF) means a $300 million, five year, federal program within the Atlantic Investment Partnership framework, established pursuant to sub-section 13(g) of the Atlantic Canada Opportunities Agency Act to address the Atlantic region's innovation gaps.

"Innovation" means a process through which economic value is extracted from knowledge through the generation, development and implementation of ideas to produce new or significantly improved products or processes.

"Pan Atlantic" means an area of coverage of a project containing at least two and preferably all Atlantic provinces. This area of coverage refers to the scope of a project, either in terms of the reach of its intended benefits (e.g., specific clients and/or general economic benefits) or in terms of the participants in the project (e.g., a group of research institutions and/or private sector firms or associations) or both.

"AIF Advisory Board" means the members appointed by the Minister pursuant to Section (5)3 of the Atlantic Canada Opportunities Agency Act, to review project proposals and to provide advice and recommendations to the Minister.

"Request for Project Proposals" means a process by which eligible applicants will be able to submit proposals to compete for AIF funding of a project.

"Incremental" means new or additional activities over and above existing/ongoing activities that cannot proceed without funding from AIF. The project is such that it cannot be supported in-house, it cannot attract sufficient outside financing, or the project is too risky to be undertaken using internal financial resources.

"Strategic Sectors/Technologies" means those sectors and technologies in which Atlantic Canada possesses a comparative advantage or potential to create such an advantage.

"Economic Benefits" means benefits that can be measured in the short, medium and long term by a pre-determined set of indicators including new research competencies in strategic sectors, the development of new or improved products, processes, technologies or services, or the use of R & D results in industry with resulting new business start-ups and jobs.

"Project" means an undertaking as described in section 5.

"Research and Development" (R&D;):
- Research means the planned search or critical investigation aimed at the discovery of new knowledge or new application of existing knowledge, with the objective that such knowledge may be useful in developing new products, processes, technologies or services, or in bringing about significant improvements to existing products, processes, technologies or services.
- Development means to convert research findings into a plan, blueprint or design for new or improved products, processes, technologies or services; initial demonstration or pilot project and prototype; and other related pre-production activities.

"Natural Sciences" means such disciplines as biology, chemistry, physics, life sciences and ocean sciences.

"Applied Sciences" means such disciplines as engineering and computer science.

"Social Sciences" means such disciplines as sociology and psychology.

"Humanities" means such disciplines as philosophy, arts and languages.

"Commercialization" means the process of introducing new products, processes, technologies or services to the marketplace.

"System of Innovation" means the set of institutions, firms, linkages and interactions which determine the innovation performance of firms and organizations.

3.     Program/Legislative Authority

The authority for this program is pursuant to sub-section 13 (g) of the Atlantic Canada Opportunities Agency Act and Cabinet approval in June 2000 (RD 20/07/00).

4.     Objectives

The objectives of the AIF program are:

• to increase activity in and to build capacity for innovation, research and development (R&D;) which leads to technologies, products, processes or services which contribute to economic growth in Atlantic Canada;
• to increase the capacity for commercialization of R&D; outputs;
• to strengthen the region's innovation capacity by supporting research, development and commercialization partnerships and alliances among private sector firms, universities, research institutions and other organizations in the Atlantic System of Innovation, and to increase their critical mass; and
• to maximize benefits from the national R&D; programs.

A combination of the following are among key considerations in meeting the AIF objectives:
- includes private sector participation (for institutional proposals);
- fills a gap in the Atlantic System of Innovation;
- improves innovation capacity of private sector;
- is Pan-Atlantic in scope;
- builds critical mass through networks/cooperation of existing and/or additional talent (researchers);
- leverages funding from other public and private sector sources;
- attracts new firms, institutions and researchers to Atlantic Canada;
- builds on research excellence; and
- fosters national and international affiliations.

5.     Program Description

The Minister may make a contribution in support of R&D; projects and related initiatives which are focussed in the area of natural sciences; applied sciences; and social sciences and humanities where these are linked explicitly to the development of technology-based products, processes or services or their commercialization, and thereby strengthen the region's System of Innovation. The AIF shall focus on increasing Research and Development linked to economic development and commercialization objectives in areas that are of strategic importance to the region, particularly those that support the growth of Strategic Sectors/Clusters. Related initiatives will emphasize building the Atlantic System of Innovation, including those components that bridge the gap between research institutions and the marketplace, and encouraging synergies among the various components of this system through partnerships, alliances and networks.

6.      Eligible Recipients

Eligible recipients include commercial and non-commercial entities such as, but not limited to, universities, colleges, other post-secondary educational institutions, business associations, research institutions and private sector firms.

Federal departments, including federal research laboratories and institutes, and provincial government departments are not eligible recipients.

7.     Stacking Provisions

Contributions shall be negotiated to be the least amount required to allow a project to proceed and shall conform to the Treasury Board Policy on stacking. The level of assistance to non-commercial applicants from the AIF shall not exceed 100% of total eligible costs. However, only on an exceptional basis would the maximum contribution exceed 80% of total eligible costs, and 30% of the eligible costs of new buildings and major renovations. The level of assistance to commercial applicants from all government sources shall not exceed 75% of total eligible costs.

In a case where assistance exceeds Total Government Assistance, the amount to be repaid will be calculated as the difference between total assistance from all levels of government and 75% of the total estimated project cost for commercial projects or such other percentages as applicable for non-commercial projects. Any amount to be repaid will be established as an account receivable.

Financial statements will be obtained from recipients to disclose all government assistance received for the project.

8.     Request for Project Proposals

Implementation shall normally be delivered through the Request for Project Proposals process of the Atlantic Innovation Fund. The Request for Project Proposals shall be opened to eligible recipients as per Section 6.

Proposals for commercial projects with the contribution amount of $500,000 or less are not eligible under AIF.

9.     Application Requirements

The Request for Project Proposals will provide potential applicants with detailed guidelines for preparing project proposals under the Atlantic Innovation Fund. A project proposal will include a description of the proposed project, a description of the applicant including any partners, the project team and management structure, the technical proposal, commercialization potential, economic benefits and financial information.

Essential criteria for consideration of project proposals are as follows:

- must be compatible with the AIF objectives;
- must be scientifically and/or technically sound;
- must demonstrate management capability to successfully undertake the project;
- must demonstrate significant economic benefits for Atlantic Canada;
- must address ultimate commercialization potential of project;
- must support new or improved technologies or new applications of technologies;
- must have adequate financing for the duration of the project;
- must be incremental; and
- must support one or more Strategic Sectors/Technologies.

All contributions approved by the Minister shall be in compliance with the Post-Employment provisions of the Conflict of Interest and Post-Employment Code for Public Office Holders and for the Public Service.

10.     Eligible Costs

Eligible costs shall include all reasonable incremental costs deemed essential for the implementation of the project including the following:

- incremental wage and salary costs including payroll burden of personnel directly associated with the project;
- equipment, installation costs, and software required for the project; and,
- operating costs for the project including travel and direct overhead costs.

Eligible costs exclude costs of land and goodwill. Also excluded are asset costs in excess of fair market value.

11.     Maximum Amount Payable

The AIF will normally be based on a Request for Project Proposals process. The AIF will encourage collaboration between proponents; per project and per proponent limits would work against this by imposing arbitrary limits that may conflict with the program's objectives.

The maximum contribution to any AIF project will not exceed $10 million, unless otherwise approved by Treasury Board.

12.     Approval

The Minister has the authority to approve projects. The AIF Advisory Board shall provide the Minister with substantive recommendations on strategic directions and specific project proposals.

Members of the AIF Advisory Board shall be appointed by the Minister, pursuant to Sub-Section 5(3) of the Atlantic Canada Opportunities Agency Act.

Financial Signing Authorities

Spending Authority

Certification of the Availability of Funds (Section 32 of Financial Administration Act)

Authority to certify funds are available and to record commitment is delegated to positions as listed in the following table.

Expenditures Initiation

Authority to sign contribution agreements (initiate expenditures) is delegated to positions as listed in the following table.

Contract Performance (Section 34 of Financial Administration Act)

Authority, to certify that payments are in accordance with the terms and conditions of a contribution arrangement, is delegated to positions as listed in the following table.

Payment Authority

Payment Authority (Section 33 of Financial Administration Act)

Authority to requisition payments is delegated to positions as listed in the following table.

ATLANTIC INNOVATION FUND PROGRAM FINANCIAL SIGNING AUTHORITIES
SPENDING AUTHORITY				PAYMENT AUTHORITY
Certification of Availability of Funds - Section 32 of FAA Vice-President, Policy and Programs Regional Vice-Presidents Director General, Programs Director, Innovation or equivalent Senior Advisor, Financial Services or equivalent Administrative Assistant or equivalent	Expenditure Initiation   Vice-President, Policy and Programs Regional Vice-Presidents Director General, Programs Director, Innovation or equivalent	Contract Performance - Section 34 of FAA Vice-President, Policy and Programs Regional Vice-Presidents Director General, Programs Director, Innovation or equivalent		Payment Authority - Section 33 of FAA Vice-President, Policy and Programs Regional Vice-Presidents Director, Finance and Corporate Services Chief, Corporate Accounting Director of Operations or equivalent Senior Advisor, Financial Services or equivalent

ANNEX B  -  Administration and Declaration Forms

ANNEX C  -  Guide for Preparation and Submission of Project Proposals

1.     Purpose of document

This document is to be used as a guide. It provides concrete information on the mandatory elements to be included in any proposal. The document also provides information on the criteria to be used by ACOA and the AIF Advisory Board in evaluating any proposal.

2.     Submission of letter of intent and project proposal

Proponents must provide a Letter of Intent, of no more than three pages, as soon as possible after the issue of this Request for Project Proposals, but no later than September 30, 2002. It should be mailed to ACOA Head Office, Attention: Mr. Alan Miller, P. O. Box 6051, Moncton, N.B., E1C 9J8. This letter is required for planning purposes in order to improve the overall efficiency of the project evaluation process. Specifically, it will help the Agency to identify, at an early stage, potential expert scientific reviewers; the number and type of projects in specific sectors; and the resource requirements for review teams and account managers. The letter should include a general description of the research proposal including the project objectives; anticipated deliverables and challenges; sector of interest (for guidance, refer to Annex "B", section #5); estimated project costs; estimated amount to be requested from the AIF program; and the names and addresses of potential independent reviewers (for guidance, refer to Annex "B", section #15). This letter will not be used to pre-screen projects.

The project proposal must be received by ACOA in its entirety no later than 4:00 pm local time on Wednesday, November 27, 2002 either via the Internet or by courier or hand delivery to one of ACOA's offices listed in Annex "H".

Proposals sent by e-mail or fax will NOT be accepted.

If proposal is sent by courier or hand-delivered, it must be marked Atlantic Innovation Fund - Response to Second Request for Project Proposals and follow the format as outlined in this guide. The proposal must also include a completed Administration Form and Declaration Form which are available in a Word template. (If a proponent is not using Word, the Administration and Declaration forms can be prepared in either Word Perfect or Rich Text Format.) Please provide three (3) paper copies of the entire proposal, one (1) of which should be unbound, as well as an electronic version on a diskette or compact disk (CD).

If a proposal is to be submitted on-line, proponents should refer to the on-line instructions at http://www.acoa-apeca.gc.ca and select the link to AIF. Submitting on-line requires that an account be established at least one week (five working days) in advance of the closing date.

3.     Format

Project proposals must be complete, clear and concise. A thorough proposal could be prepared in as few as 15 pages, but should not normally exceed 35-40 pages. Proposals must be submitted using the following format:

 Paper format: 8 ½" X 11"
 Font size for text: 12 point
 Pages are to be numbered.
 Page foldouts, schematics, drawings, etc. may be included or attached for clarity of presentation.

4.     Marking confidentiality of proponent's information

All information regarding the terms and conditions, financial and/or technical aspects of a proponent's proposal, which in a proponent's opinion is of a proprietary or confidential nature, should be clearly marked "PROPRIETARY" or "CONFIDENTIAL" on each relevant item or page or in a statement covering an entire proposal.

Should a proponent provide the requested information to ACOA in confidence by indicating that the disclosed information is confidential, ACOA will treat the information in a confidential manner, unless otherwise required by the Access to Information Act and the Privacy Act.

5.     Content of Proposal

Proponents must submit a separate proposal for each stand-alone project to facilitate overall project evaluation by ACOA. A stand-alone project has a distinct scientific/technological basis for the development of a product, process or service that is technologically innovative and commercially viable. Stand-alone projects are not dependent on the success of other projects or activities. Where stand-alone projects are complementary (e.g., same proponent or same area of research, etc.) provide cross-references in each proposal to those projects.

Where the proponent deems it necessary to group projects into one proposal, because of their strong interdependency, the proponent must include a rationale/justification in a covering letter and must ensure that all relevant sections of the proposal are completed for each project.

5.1     Title Page

Please note that the "project name or title" could be used by ACOA for reporting and communications purposes.

5.2     Executive Summary

The executive summary is a representative synopsis of the information included in the proposal and should be suitable for distribution as a stand-alone document. The executive summary must not exceed two (2) pages.

It should include the following elements:

• project objective(s) and description (in plain language for a news release, if project is approved), including the resulting product(s) to be developed and its technical challenges;
• description of proponent;
• description and role of key collaborator(s);
• project cost, and assistance requested from the AIF program;
• project location(s) and time lines; and
• commercial applications and/or key economic benefits.

5.3     Project Description and Technical Overview

This section should outline the objective(s) of the proposed project and its envisioned end result.

Describe the "resulting product(s)" that would be developed during this project. Resulting product is broadly defined as a new technology-based product, process or service that is not presently available in the market place, at least not in the form envisioned by the project.

Provide, in a non-technical manner, a concise overview of the underlying technology and the state-of-the-art of this technology. Explain the innovative aspect(s) of the resulting product(s). Articulate if there would be any derivative applications for the new technology.

If the resulting product would be a new product or new service that builds capacity usable for other product development activities, provide examples.

Provide an overview of the research and development that would be carried out in the project. Explain, in broad and non-technical terms, what scientific/technical challenges exist, the major activities that would be undertaken, the milestones and deliverables. (It is in section 5.8 - Technical Details, and not in this section, that proponents must provide complete details of the scientific/technical process. It may be advisable for proponents to complete section 5.8 before completing this section.)

As AIF can only support incremental activities that are new or additional activities over and above existing/ongoing activities, explain how this project would be incremental.

5.4	Description of Proponent, Key Collaborators and Project Team

The information submitted under this heading should allow the Agency to assess the proposal against the essential criterion, "Must demonstrate management capability to successfully undertake the project". The objective is to provide sufficient information about the managerial capability of the project team to undertake and bring the proposed project to successful completion.

The proponent and partners should have strong project management, financial control and technical development skills. Where weaknesses exist, remedial measures should be explained. This section should address the following:

(a)

Description of Proponent - describe in full detail the organization and its history (e.g., name and legal status; how long in existence; what it does; how it has grown; etc.); and, its size (e.g., in terms of annual sales or operating budget, and number of employees). Discuss the area of specialization; the proposed role in connection with the project; and historical track record in R&D;, technology development and commercialization, particularly as this relates to the proposed project. Explain why the proposed project is relevant to the organization, and what it expects to gain from undertaking it. Discuss the governance structure of the organization (e.g., list of Directors, Executive Committee, Advisory Board, etc.). Provide an organization chart, list the key personnel and provide their résumés as appendices. In the case of a commercial proponent (i.e., private company), list the principal(s) and their percentage of ownership.

(b)

Description of Key Collaborator(s) and the Partnership Arrangement(s) - a "key collaborator" is defined as a participant who is actively involved in the project, who has a direct and material influence on the project's direction; and without whose involvement the project could be in jeopardy. Briefly describe the key collaborator(s) in terms of their name and legal status; size (e.g., in terms of annual sales or operating budget, and number of employees); area of specialization; proposed role in connection with the project; and estimated financial commitment. If the organization is making a financial contribution to the project, but is not actively involved, their contribution should be detailed in the financial information section. If a key collaborator is a private company, list the principal(s) and their percentage of ownership of the organization. Describe the organization's historical track record in R&D;, technology development and/or commercialization, particularly as this relates to the proposed project. Indicate the strategic assets each key collaborator brings to the project. Outline the agreed partnership/collaboration arrangement(s). Letters of agreement, memoranda of understanding and/or other partnership/collaboration agreements should be included as appendices to the proposal. (Do not attach corporate brochures or annual reports.) Please note that proponents must disclose if any subcontract(s) would be awarded to a key collaborator under this project.

(c)

Project Team - name the Project Manager, the key members of the project team and state their specific qualifications and experience for the work involved. Highlight the unique expertise each offers to enhance the capability of the team to perform the work. Indicate provisions for back-up personnel for key positions. Provide an organization chart of the project team and describe the relationship of the team to the proponent. Detailed résumés for key research positions must also be included, as appendices. If a project team member(s) has not yet been identified, provide a statement of qualifications.

(d)

Project Control System - project management and financial control are important considerations for the successful completion of a project. Good project management helps to avoid schedule compression in the final phase of a project. Outline the methods and system to be used to control tasks, the schedule and costs.

5.5     Financial Information

The information submitted within this section should allow the Agency to assess the proposal against the essential criterion, "Must have adequate financing for the duration of the project", as well as the desirable criterion, "Leverages funding from other public and private sector sources".

Leveraging funding from other sources is a key consideration in the evaluation of proposals. Proponents are encouraged to seek out and submit applications to other government programs, universities, associations and research foundations. Proponents should also seek investment from the private sector.

To enable the Agency to assess the reasonableness of the proposed project costs and feasibility of the project financing, the proponent must provide a detailed breakdown of costs and financing. This should follow the format presented in the costs and financing templates presented in Annex "D". Proponents should only use those cost and financing line items that are relevant to their project. Proponents should review all the templates prior to preparing their information. In no particular order, they are:

-	Template "A" - Project Costs;

-	Template "B" - Eligible Cost Breakdown;

-	Template "C" - Wages and Salaries Detail;

-	Template "D" - Distribution of Eligible Project Costs (by participant);

-	Template "E" - Distribution of Eligible Project Costs (by major activity); and,

-	Template "F" - Project Financing.

To ensure completeness of the required financial information, proposals should include the following:

(a)

Project Costs - a detailed description of costs considered eligible under the AIF Program is contained in the Statement of Work Guide, Annex "G". It should be noted that only incremental costs deemed essential for the implementation of a project are eligible. Provide detailed breakdown of each cost line. Explain, as appropriate, any significantly high or unusual cost element(s). A precise explanation of the method used to calculate any overhead cost allocation is required. Include quotes, as appropriate, to support specific cost items.

(b)

Project Financing - proponents should fully describe the source of their own contribution to the project (e.g., cash, working capital, other internal revenue source(s), anticipated project revenue, etc.). Explain, as appropriate, any non-monetary contribution expected from related parties, collaborators and/or third parties. Include letters of commitment received from financing partners, e.g., Letter of Offer, legal agreement, etc., as appendices.

(c)

Historical Financial Information - proponents must provide their independently prepared, preferably audited, financial statements for the last three fiscal years. Provide the latest monthly interim financial statement. Insert both as appendices. (Universities and Colleges are exempt from this requirement.)

(d)

Projected Financial Information - proponents should clearly demonstrate their ability to finance their current operations and any follow-up activities, including the commercialization phase. As appendices, proponents should provide three-year projected statements for the company including Cash Flow Statement, Income Statement, and Balance Sheet. These should be supported with an explanation of the key assumptions used in their preparation. Some non-commercial proponents may be able to satisfy this requirement with proof of financial commitment(s) from key project collaborator(s).

(e)

Other Considerations - it should also be noted that expenditures and cost commitments incurred prior to ACOA's receipt of a proponent's project proposal are not eligible in calculating AIF program financial assistance. For projects that are approved, eligible expenditures and cost commitments incurred prior to project approval, but after ACOA's receipt of the project proposal, would be included in the contribution from AIF. Should a proponent proceed with a project, in whole or in part, prior to receiving a decision from ACOA, it would be at the proponent's financial risk.

5.6     Commercialization Potential/Strategy

The information submitted within this section should allow the Agency to assess the proposal against the essential criterion, "Must address ultimate commercialization potential of project". The objective is to provide information about the commercialization potential of the proposed resulting product(s) and, ultimately, its potential to successfully achieve market penetration.

Proponents should also comment under this heading on the desirable criterion, "Includes private sector participation (for institutional proposals)". Private sector participation could impact on ultimate commercialization and represent a strategic advantage (e.g., a private sector commitment in terms of dollars; past success at commercializing research; a private sector affiliation with a company already selling or producing products for the targeted market; established distribution channels; etc.).

Proponents must clearly outline their vision of the market potential of the proposed resulting product(s) described in section 5.3. Elements to be addressed include the targeted niche within the market; the market need and size; the probable price and production strategy; the potential competitors and competing product, process or service; and the major challenges to market penetration. It is expected that proponents with early stage research projects may have to limit the commercialization discussion to these elements. Proponents should also indicate if the associated research and development could yield other commercialization opportunities. It should be noted that the market/commercialization potential for all research projects should have been validated through market research. Proponents should reference and provide this supporting market research information.

Proponents, with projects closer to commercialization, are expected to also discuss elements such as the planned promotion, sales and distribution strategy, as well as the market penetration objectives.

However, all proponents should recognize the need to have a marketing and sales strategy in place at the end of the R&D; effort.

5.7     Economic Benefits

In addition to economic benefits flowing from the commercialization of the proposed resulting product(s), additional economic benefits should accrue to Atlantic Canada as a result of public investment in the proposed project. The information submitted within this section should allow the Agency to assess the proposal against the essential criteria "Must demonstrate significant economic benefits for Atlantic Canada" and "Must support one or more strategic sectors or technologies".

Proponents should also comment under this heading on the desirable criteria that relate to economic benefits, i.e., "Fills a gap in the Atlantic System of Innovation"; "Improves innovation capacity of the private sector"; "Is Pan-Atlantic in scope"; "Builds critical mass through networks/cooperation of existing and/or additional talent (researchers)"; "Attracts new firms, institutions and researchers to Atlantic Canada"; and, "Fosters national and international affiliations".

"Pan-Atlantic", as defined in the Terms and Conditions in Annex "A", "means an area of coverage of a project containing at least two and preferably all Atlantic provinces. This area of coverage refers to the scope of a project, either in terms of the reach of its intended benefits (e.g., specific clients and/or general economic benefits) or in terms of the participants in the project (e.g., a group of research institutions and/or private sector firms or associations) or both." Pan-Atlantic embodies the development of genuine partnerships and networks among organizations in Atlantic Canada that create research and/or commercialization synergies which could lead to joint opportunities. The intent under AIF is not to encourage proponents to open new offices in other Atlantic provinces or for organizations from various Atlantic provinces to present their stand-alone research projects under one AIF proposal.

In discussing the above criteria, proponents should describe in specific detail, and quantify where possible, such other economic benefits as the type of direct and indirect jobs to be created, export potential, the opportunities for training, the advancement of knowledge in general, and the opportunities for other research projects coming to Atlantic Canada. These may be addressed in terms of short, medium and long-term benefits to the region.

5.8     Technical Details

The information submitted under this section (as well as under section 5.3) should allow the Agency and scientific experts to assess the proposal against the essential criteria "Must be scientifically and/or technically sound" and "Must support new or improved technologies or new applications of technologies", as well as the desirable criterion "Builds on research excellence".

This section should identify the major technical problems to be solved in order to achieve the desired objective(s), and the proposed approach for solving these problems. Proponents must provide sufficient detail to enable independent scientific reviews of the proposal by experts in the field. (For successful proponents, information from this section will be incorporated into the Statement of Work - Annex "G", which would form part of the Contribution Agreement.) This section should include:

(a)	Background - indicate the scientific basis for the proposed research and comment on preliminary investigations related to this research. Identify references to key scientific and technical literature, and provide the scientific rationale and key assumptions that support this project.

(b)

Methodology - state the approach and methodology to be used to meet the project objectives and to develop the technology-based resulting product(s). Address the availability of equipment and facilities to support the methodology. For each major research activity (or phase), describe the work to be undertaken, including:    -   the activity objective;    -   anticipated scientific/technical challenges;    -   experimental procedures or research methods to be employed;    -   expected duration of the activity;    -   indicators of success;    -   expertise required; and    -   milestones and deliverables.

The methodology must also account for the time to be spent by each team member on the project. A summary schedule should relate key activities, milestones and deliverables to a project timetable and clearly identify target dates for completion. (Refer to the Statement of Work Guide in Annex "G" for suggested format.)

(c)

Technical Risk Assessment - (in order to develop applications of advanced technologies through technology-based products, processes and services, some risk has to be assumed. In general, the degree of risk is related to the level of technical innovation and the level of planning effort. The extent to which higher technical risks are acceptable is dependent upon how well they have been identified, defined, assessed, planned for and managed once encountered.) Describe the technical risks involved, including technological uncertainties, and proposed approach for addressing the technical risks identified.

(d)

Intellectual Property - for any technologies to be transferred into the project and/or technology to be developed, describe the intellectual property arrangements including the proponent's rights to, and protection for, the intellectual property required to exploit the technology involved in the project. Describe the measures which would be taken to ensure that the resulting technologies would remain in and provide continuing benefits for Atlantic Canada.

5.9     Appendices

As a reminder, references have been made in this guide for proponents to include information as appendices to proposals. As appropriate, the following items should be included:

(a) Proponent, Key Collaborator(s) and Project Team Information:

• Proof of the legal existence of the organization(s), e.g., letters patent, charter of incorporation, etc.
• Corporate ownership structure, list of Directors, etc.
• List of any related, associated and affiliated company/organization and relevant information as appropriate, e.g., description, financial statements, etc.
• Organization chart, résumés of key personnel, etc.
• Project Team chart, résumés, accomplishments, references, etc.
• Letters of interest, commitment and Memorandum of Understanding with collaborators/partners, i.e., details, level, timing, and monetary participation.

• Quotes supporting major cost items
• Letter of offer, legal agreement, etc.
• Independently prepared financial statements for the last three fiscal years
• Latest monthly interim financial statements
• Projected financial information

• Market study

Completeness

Proponents must be able to demonstrate under sections 5.3 to 5.8 above how the proposed project meets the essential eligibility criteria, and as many of the desirable criteria as possible. (See section 3.4 of the main body of this RFPP.)

Incomplete proposals, and failure of a proposal to provide information in sufficient detail and depth to permit a complete assessment against at least the essential criteria, will render a proposal non-compliant, and it will result in funding not being offered.