DATE: June 18, 2004

SUBJECT: General Services Administration Acquisition Regulation (GSAR); Debarment, Suspension, and Ineligibility

SOURCE: Federal Register, June 18, 2004, Vol. 69, No. 117, page 34247

AGENCIES: Office of Governmentwide Policy, General Services Administration (GSA)

ACTION: Proposed Rule

SYNOPSIS: GSA is proposing to amend GSAR 509.406-3, Procedures, to require that the debarring or suspension official provide those being considered for debarment or suspension with a Show Cause Notice before issuing a Notice of Proposed Debarment or Suspension.

EDITOR'S NOTE: The GSAR is the shaded part of the GSA Acquisition Manual, which is available on the Internet at http://www.acqnet.gov/GSAM/gsam.html.

DATES: Comments on the proposed rule must be submitted on or before August 17, 2004.

ADDRESSES: Submit comments to General Services Administration, Regulatory Secretariat (MVA), 1800 F Street, NW, Room 4035, Attn: Laurie Duarte, Washington, DC 20405; through the Internet at http://www.regulations.gov; or by e-mail to: gsarcase.2004-G502@gsa.gov. Cite "GSAR case 2004-G502" in all correspondence related to this proposed rulem.

FOR FURTHER INFORMATION CONTACT: Ernest Woodson, 202-501-3775, or by e-mail to: ernest.woodson@gsa.gov.

SUPPLEMENTAL INFORMATION: It is the government's policy to solicit offers from, award contracts and orders to, and consent to subcontracts with responsible contractors only. A contractor that is convicted of fraud in connection with a federal contract, theft, forgery, bribery, and other similar serious offense that indicates a lack of business integrity or honesty may be debarred from receiving contract awards for up to three years. A contractor that is suspected, upon adequate evidence, of any of the same offenses may be suspended from receiving contract awards for up to 18 months. The serious nature of debarment and suspension requires that agencies impose the sanctions only in the public interest for the government's protection. Debarment or suspension is not to be imposed as punishment for prior bad acts.

GSAR 509.406-3(d) (and GSAR 509.407-3, Procedures, which states that the procedures of GSAR 509.406-3 apply to suspension actions except as noted) provides the decision-making processes for determining whether parties should be debarred or suspended. These procedures supplement Federal Acquisition Regulation (FAR) Subpart 9.4, Debarment, Suspension, and Ineligibility, which prescribes policies and procedures governing the suspension and debarment of contractors that are determined not to be responsible by federal agencies.

Currently, there is no requirement in the FAR or GSAR that contractors being considered for debarment or suspension be notified by the agency. The proposed rule would provide parties who are being considered for debarment or suspension with a Show Cause Notice. The Show Cause Notice would give the parties being considered for debarment or suspension an opportunity to informally respond to the allegations.

The proposed rule would add a paragraph (d)(2) to GSAR 509.406-3, which would state:

"The debarring official must provide a Show Cause Notice to each party being considered for debarment, before issuing a Notice of Proposed Debarment. However, a Show Cause Notice need not be provided if (i) the debarring official, in her/his sole discretion, has determined that any delay in issuing the Notice of Proposed Debarment would cause imminent harm to the Government; or, (ii) a suspension is already in effect."

Paragraph (b)(2)(ii) of GSAR 509.407-3, which addresses suspension procedures, would be amended to revise the cross-reference to GSAR 509.406-3.

FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953 or by e-mail to Panoptic@FedGovContracts.com.

Copyright 2004 by Panoptic Enterprises. All Rights Reserved.

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