[Federal Register Volume 60, Number 122 (Monday, June 26, 1995)]
[Rules and Regulations]
[Pages 33037-33064]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-14725]




  Federal Register / Vol. 60, No. 122 / Monday, June 26, 1995 / Rules 
and Regulations   
[[Page 33037]] 

OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 970

DEPARTMENT OF AGRICULTURE

7 CFR Part 3017

DEPARTMENT OF ENERGY

10 CFR Part 1036

SMALL BUSINESS ADMINISTRATION

13 CFR Part 145

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

14 CFR Part 1265

DEPARTMENT OF COMMERCE

15 CFR Part 26

OFFICE OF NATIONAL DRUG CONTROL POLICY

21 CFR Part 1404

DEPARTMENT OF STATE

22 CFR Part 137

INTERNATIONAL DEVELOPMENT COOPERATION AGENCY

Agency for International Development
22 CFR Part 208

PEACE CORPS

22 CFR Part 310

UNITED STATES INFORMATION AGENCY

22 CFR Part 513

INTER-AMERICAN FOUNDATION

22 CFR Part 1006

AFRICAN DEVELOPMENT FOUNDATION

22 CFR Part 1508

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 24

DEPARTMENT OF JUSTICE

28 CFR Part 67

DEPARTMENT OF LABOR

29 CFR Part 98

FEDERAL MEDIATION AND CONCILIATION SERVICE

29 CFR Part 1471

DEPARTMENT OF THE TREASURY

31 CFR Part 19

DEPARTMENT OF DEFENSE

32 CFR Part 25

DEPARTMENT OF EDUCATION

34 CFR Parts 85, 668, and 682

NATIONAL ARCHIVES AND RECORDS ADMINISTRATION

36 CFR Part 1209

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 44

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 32

GENERAL SERVICES ADMINISTRATION

41 CFR Part 105-68

DEPARTMENT OF THE INTERIOR

43 CFR Part 12

FEDERAL EMERGENCY MANAGEMENT AGENCY

44 CFR Part 17

DEPARTMENT OF HEALTH AND HUMAN SERVICES

45 CFR Part 76

NATIONAL SCIENCE FOUNDATION

45 CFR Part 620

NATIONAL FOUNDATION ON THE ARTS AND THE HUMANITIES

National Endowment for the Arts
45 CFR Part 1154
National Endowment for the Humanities
45 CFR Part 1169
Institute of Museum Services
45 CFR Part 1185

CORPORATION FOR NATIONAL AND COMMUNITY SERVICE

45 CFR Part 2542

DEPARTMENT OF TRANSPORTATION

49 CFR Part 29


Nonprocurement Debarment and Suspension

AGENCIES: Department of Agriculture; Department of Commerce; Department 
of Defense; Department of Education; Department of Energy; Department 
of Health and Human Services; Department of Housing and Urban 
Development; Department of the Interior; Department of Justice; 
Department of Labor; Department of State; Department Transportation; 
Department of the Treasury; Department of Veterans Affairs; African 
Development Foundation; Agency for International Development, 
International Development Cooperation Agency; Corporation for National 
and Community Service; Environmental Protection Agency; Federal 
Emergency Management Agency; Federal Mediation and Conciliation 
Service; General Services Administration; Institute of Museum Services, 
National Foundation on the Arts and Humanities (NFAH); Inter-American 
Foundation; National Aeronautics and Space Administration; National 
Archives and Records Administration; National Endowment for the Arts, 
NFAH; National Endowment for the Humanities, NFAH; National Science 
Foundation; Office of National Drug Control Policy; Office of Personnel 
Management; Peace Corps; Small Business Administration; United States 
Information Agency.

ACTION: Final Regulations and, for the Department of Transportation 
only, Interim Final Regulations with an opportunity to comment.

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SUMMARY: This revision to the nonprocurement common rule is issued in 
response to Executive Order (E.O.) 12689 and section 2455 of the 
Federal Acquisition Streamlining Act of 1994. E.O. 12689 requires 
agencies to establish regulations for reciprocal governmentwide effect 
across procurement and nonprocurement debarment and suspension actions, 
after technical differences between the procurement and nonprocurement 
regulations governing debarments and suspensions are resolved. Section 
2455 provides that the debarment, suspension, or other exclusion of a 
participant in a procurement activity under the Federal Acquisition 
Regulation, or in a nonprocurement activity under regulations issued 
pursuant to Executive Order 12549, shall be given reciprocal 
governmentwide effect. The final regulation establishes reciprocity 
between the procurement and nonprocurement debarment and suspension 
systems.

DATES: These final regulations and the Department of Transportation's 
(DOT's) interim final regulations become effective August 25, 1995. For 
comment [[Page 33038]] information on DOT's interim final regulations, 
see DOT's agency-specific preamble.

FOR FURTHER INFORMATION CONTACT: See preambles of individual agencies 
below.

SUPPLEMENTARY INFORMATION: On December 20, 1994, all but one of the 
agencies participating in the development of this final rule published 
a notice of proposed rulemaking (NPRM) that proposed to make changes to 
the nonprocurement debarment and suspension Common Rule (Common Rule) 
to provide for reciprocal effect between procurement and nonprocurement 
debarments, suspensions, and other exclusionary actions. The history of 
the nonprocurement debarment and suspension system and of the effort to 
establish reciprocity between the procurement and nonprocurement 
debarment and suspension systems was described in the December 20, 1994 
NPRM. See 59 FR 65607.
    The Department of Transportation, which did not join in publishing 
the NPRM, is joining in the publication of this regulation as an 
interim final rule. See the Department of Transportation's preamble to 
this regulation for a discussion regarding its participation in the 
Common Rule.
    Technical changes to the regulations are generally not discussed in 
this preamble. The notice of proposed rulemaking (NPRM) proposed 
amendments to the Common Rule only as necessary to achieve the 
objectives of reciprocity or to correct printing errors in the original 
regulations. The NPRM used this approach to focus attention on those 
substantive matters that were directly affected by the reciprocity 
rule. In this final regulation, fuller text is provided, including, at 
a minimum, the entire paragraph where any change is made, so that 
readers may see the amendments in context. The text of the Common Rule 
amendments is set out at the end of this preamble and is followed by 
the agency-specific preambles and any agency-specific amendments to the 
Common Rule.

Response to Comments

    Five commenters provided their views on the proposed amendments to 
the Common Rule. Eight comments were also submitted regarding the 
effect of the proposed rule on specific agencies or regarding specific 
additional changes to the Common Rule that were proposed by certain 
agencies. Those comments are addressed in the agency-specific preambles 
that follow the amendments to the Common Rule.

Request for Future Rulemaking

    The Administrative Conference of the United States (ACUS) submitted 
a comment supporting the proposed reciprocity amendments and asked that 
the agencies participating in this rulemaking effort initiate a 
subsequent rulemaking effort to consider additional changes to the 
Common Rule and the Federal Acquisition Regulation (FAR), consistent 
with ACUS Recommendation 95-2, which that agency adopted on January 19, 
1995. Another commenter mentioned the ACUS recommendation and asked 
that it be considered in a future rulemaking action, noting 
particularly that part of the recommendation regarding the need for 
agencies to consider mitigating and aggravating circumstances. The 
agencies participating in this rulemaking action agree that additional 
changes to the Common Rule should be considered and will consider 
Recommendation 95-2 along with other proposed changes to the Common 
Rule before the end of this year.
    Should the FAR be amended so that proposed debarments would not be 
effective?
    Comment: Three of the commenters were concerned about a difference 
between the procurement and nonprocurement rules that was not addressed 
by the NPRM. Under the FAR subpart 9.4, Debarment, Suspension, and 
Ineligibility, a proposed debarment has the effect of excluding a party 
from receiving a contract. In contrast, under the Common Rule, a 
proposed debarment has no effect on a person's eligibility to 
participate in a nonprocurement program. In each of the three comments, 
the commenter asked that the FAR rule be amended so that proposed 
debarments under subpart 9.4 would have no effect.
    Discussion: While the three comments request changes to the FAR and 
do not technically request any change to the Common Rule, the agencies 
participating in this rulemaking action agree that there is no need to 
change either rule so that the effect of a proposed debarment is the 
same under both debarment and suspension systems. The request to make 
the two rules the same on this matter misconstrues the purpose and 
effect of the reciprocity effort.
    The purpose of the proposed reciprocity rule is to ensure that, 
once one agency takes action to exclude a person and that person is 
placed on the List of Parties Excluded from Federal Procurement and 
Nonprocurement Programs, all agencies will honor that determination. In 
deciding whether to take an action to exclude a person, the agency 
considers whether a person's present responsibility is affected such 
that the person poses a risk to the Federal Government. The agencies 
did not intend that the decision to give reciprocity would require the 
agencies to change the two debarment and suspension systems and 
establish identical procedures for excluding persons under both the FAR 
and the Common Rule.
    Change: None.
    Comment: One commenter thought that the nonprocurement common 
rule's recognition of proposed debarments under the FAR went beyond the 
authority in section 2455 of the Federal Acquisition Streamlining Act, 
which provides that ``Regulations shall be issued providing that 
provisions for the debarment, suspension, or other exclusion of a 
participant in a procurement activity under the Federal Acquisition 
Regulation (FAR), or in a nonprocurement activity under regulations 
issued pursuant to Executive Order 12549, shall have government-wide 
effect.'' The commenter pointed out that this statute does not list 
proposed debarments specifically and, therefore, argued that the 
nonprocurement rule could not give effect to proposed debarments 
entered under the FAR. The commenter suggested that the phrase ``other 
exclusion'' probably referred to voluntary exclusions under section 
________.210 of the common rule.
    Discussion: Section 2455 does not limit, as suggested by the 
commenter, the scope of the amendments that agencies may make to the 
Common Rule. The passage quoted by the commenter states that agencies 
shall give effect under the Common Rule to ``debarment, suspension, or 
other exclusion of a participant in a procurement activity under the 
Federal Acquisition Regulation (FAR)'' (emphasis added). A proposed 
debarment is an exclusion under the FAR, thus, section 2455 of the 
Streamlining Act authorizes agencies to promulgate nonprocurement rules 
that give effect to proposed debarments under the FAR. The commenter's 
suggestion that ``other exclusion'' referred to voluntary exclusions 
does not bear weight. There is no history that Congress intended to 
limit that term to a unique exclusion that exists in only one system. 
Rather, ``other exclusion'' must refer to any exclusion that has effect 
under either system.
    Change: None.
    Comment: One commenter raised a hypothetical situation which it 
believed demonstrated a difficulty between the [[Page 33039]] two rules 
regarding the enforceability under the common rule of proposed 
debarments entered under the FAR. In the commenter's example, two dairy 
companies (Dairy X and Dairy Y) are attempting to enter into like 
transactions with the Federal Government. Dairy X has been proposed for 
debarment under the FAR while Dairy Y has been proposed for debarment 
under the nonprocurement regulations. Under the proposed regulations, 
Dairy Y could be considered for a contract under the FAR but Dairy X 
could not be considered for a contract under the FAR. The commenter was 
uncomfortable with the alleged disparate treatment of the two dairies.
    Discussion: The commenter is correct that Dairy X would be excluded 
but Dairy Y would not be excluded. However, if Dairy Y posed an 
immediate threat to the Federal Government, the agency that proposed 
its debarment under the nonprocurement regulations could suspend Dairy 
Y under those regulations. In short, while the two systems use slightly 
different mechanisms to protect the Federal Government, those 
differences do not need to be eliminated in order to give reciprocity 
for actions taken under the two systems.
    Change: None.

Section ______ .100 Purpose

    Comment: One commenter noted that the list of excluded persons 
under paragraph (c) of section ________ .100 differed from the list 
included in the definition for the List of Parties Excluded from 
Federal Procurement and Nonprocurement Programs included in 
Sec. ________.105, focusing on the fact that paragraph (c) in section 
________.100 did not mention voluntarily excluded persons.
    Discussion: A review of the Common Rule, including those portions 
not amended by the proposed rule reveals that the purpose section does 
mention voluntary exclusions in its more detailed provisions 
implementing Executive Order 12549 (See section ________ .100(b)(3)). 
These detailed provisions did not need to be set out again to indicate 
the actions under the FAR that would be added to the List as a result 
of the reciprocity rule.
    Change: None.

Section ________ .105 Definitions

    Comment: One commenter noted differences between the FAR definition 
and the Common Rule definition for the List of Parties Excluded from 
Federal Procurement and Nonprocurement Programs and requested that the 
Common Rule use the FAR language. This commenter also asked that the 
nonprocurement Common Rule definition of the List not refer to the 
authorizing executive orders because the authority for a debarment or 
suspension would be the regulations of the agency that took the action.
    Discussion: The substance of the two definitions is identical and 
the reason for the different language used in the two definitions is 
the different contexts in which the definitions appear. The FAR 
definition refers to ``parties'' while the nonprocurement Common Rule 
refers to ``persons.'' The term ``parties'' is used throughout the FAR 
to refer to contractors. The Common Rule refers to ``persons'' because 
many of the entities covered by a nonprocurement debarment or 
suspension do not have a relationship of privity with the Federal 
Government.
    Regarding the request not to refer to the executive orders, no 
change is made because these executive orders address substantive, not 
merely procedural authority for the agency regulations under which a 
debarment or suspension is entered.
    Change: None.

Section ________ .110, Coverage.

    Comment: One commenter asked that the references to the executive 
orders and to section 2455 of the Federal Acquisition Streamlining Act 
of 1994 (Public Law 103-355) be removed from the proposed reciprocity 
rule in Sec. ________ .110(c).
    Discussion: The agencies participating in this rulemaking action 
believe that it is appropriate to cite the substantive authority for 
reciprocity in the actual paragraph that gives effect to that 
authority.
    Change: None.
    Comment: One commenter thought that a suspension imposed different 
burdens than a debarment. Thus, the commenter was concerned that the 
reciprocity phrase requiring a FAR debarment or suspension to ``be 
recognized * * * as an exclusion'' should be changed to require that a 
FAR debarment or suspension ``be recognized * * * as a comparable 
action.'' This commenter had a similar concern regarding the 
recognition of governmentwide nonprocurement exclusions under the FAR.
    Discussion: This comment starts from a mistaken view. Once a person 
or party is excluded from participation in a nonprocurement transaction 
or from entering into a contract, that person is treated the same way, 
whether the person entered that excluded state by being suspended or 
debarred. Thus, once a party or person is excluded, no agency may do 
business with the party or person unless the agency affirmatively makes 
a decision under the exception provision in Sec. ________ .215 and 
states the need for the exception. Because all persons or parties on 
the List are treated the same, there is no need to make the requested 
change.
    Change: None.
    Comment: One commenter suggested that the phrase ``after [the 
effective date of this rule]'' be added after the phrase ``imposed 
under this regulation'' so that the reciprocity provision regarding FAR 
recognition of nonprocurement exclusions would be parallel to the 
reciprocity provision regarding nonprocurement recognition of FAR 
exclusions.
    Discussion: The agencies agree.
    Change: The phrase ``after [date 60 days after publication]'' will 
be added after the phrase ``imposed under this regulation'' in the 
second sentence of Sec. ________.110(c).
    Comment: One commenter noted that the proposed reciprocity rule did 
not address how actions will be treated that are in process when the 
rule becomes effective. The commenter thought that these actions should 
be ``grandfathered'' under the current rule.
    Discussion: Actions initiated by notices of proposed debarments or 
suspensions sent to respondents before the date this rule becomes 
effective generally will not be given reciprocity because these 
regulations require a notice of proposed debarment to specify the 
potential effect of a debarment or suspension (See Sec. ________.312(e) 
and Sec. ________.411(g)). However, some agencies already run 
simultaneous actions under both the FAR and the Common Rule, citing the 
authority of both and giving notice that the action will be effective 
under both the FAR and the Common Rule. For these agencies, their 
actions will be effective on both sides. Once the rule becomes 
effective, these agencies will no longer need to afford to respondents 
the procedures of both rules in order to give effect on both sides. 
However, after the effective date of these regulations, agencies will 
have to give notice that actions initiated under the Common Rule will 
affect an entity's ability to receive contracts under the FAR.
    In order to clarify this result, Sec. ________.110(c) is amended to 
state that the new rule applies to actions ``initiated'' after the 
effective date of the rule rather than applying the new reciprocity 
rule to actions ``imposed'' after the effective date of the reciprocity 
rule. A proposed debarment or suspension is initiated when an agency 
[[Page 33040]] sends notice of the action to the respondent.
    Change: Section ________.110(c), as added by this rulemaking 
action, is amended to apply the new regulation to actions initiated on 
or after the effective date of the regulation.

Section ________.200 Debarment or Suspension

    Comment: One commenter was particularly concerned about the 
differences in the flow down of an action under the FAR and the Common 
Rule. Under Sec. ________.200(b), a debarment affects a person's 
ability to participate in lower tier covered transactions. In contrast, 
under the FAR rule, a debarment affects a party's ability to enter into 
contracts and places limitations on a Federal Government prime 
contractor's ability to contract with first tier subcontractors who 
have been debarred, suspended or proposed for debarment. The commenter 
wanted to know whether a debarment entered under the FAR would be 
limited in its flow down under the Common Rule and, conversely, whether 
a debarment entered under the Common Rule would have to be honored at a 
lower level under the FAR.
    Discussion: The Reciprocity rule established under this rulemaking 
effort does not affect the flow down of either the FAR or the Common 
Rule. Once a person is excluded, that person will be treated the same 
under these regulations as any other person for purposes of determining 
the entity's ability to participate in any nonprocurement covered 
transaction. The fact that the person was excluded as a result of an 
action taken under the FAR does not make the person eligible under 
these regulations to enter into lower tier covered transactions. The 
same is true for treatment of a debarment under the FAR; the fact that 
a debarment was entered under the Common Rule does not prohibit the 
excluded person from entering into a first tier subcontract provided 
the Federal Government prime contractor notifies the Contracting 
Officer of its compelling reasons for doing business with the otherwise 
excluded subcontractor.
    Change: For clarification, Section ________.200 is amended to add 
proposed for debarment under the FAR.

Section ________.215 Exception Provision.

    Comment: One commenter recommended that the exception provision be 
amended to ensure that, under the Common Rule, agencies could give an 
exception permitting participation by a party that is proposed for 
debarment under the FAR.
    Discussion: The agencies participating in this rulemaking effort 
agree with the concern that an agency should have the same amount of 
discretion to permit participation in a covered transaction of a party 
that has been proposed for debarment under the FAR as it would to 
permit participation by any other excluded entity.
    Change: Section ________.215 is amended so that parties proposed 
for debarment under the FAR can be considered for participation in 
covered transactions under the exception rule.

Section ______.220 Continuation of covered transactions.

    Comment: One commenter noted that a party that is proposed for 
debarment under the FAR should be treated the same as other excluded 
parties in that the party's proposed debarment should not affect the 
party's ability to participate in a covered transaction entered into 
before the proposed debarment was issued.
    Discussion: The agencies participating in this rulemaking agree.
    Change: Section ______.220 is amended to ensure that parties that 
have been proposed for debarment under the FAR will be treated the same 
under Sec. ________.220 as other persons who have been excluded.

Appendices A and B

    Discussion: Certain changes have been made in Appendices A and B, 
which contain the instructions for certifications and certifications 
for primary and lower tier participants. These technical changes 
recognize that proposed debarments entered under the FAR will be given 
effect under the Common Rule.
    Change: A reference to proposed debarments initiated under the FAR 
has been added in appropriate places throughout the instructions in 
Appendices A and B.
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OFFICE OF PERSONNEL MANAGEMENT
Text of the Common Rule

    The text of the common rule appears below:

PART ________--GOVERNMENTWIDE DEBARMENT AND SUSPENSION 
(NONPROCUREMENT) AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE 
WORKPLACE (GRANTS)

    1. Section ________.100 is revised to read as follows:


Sec. ________.100  Purpose.

    (a) Executive Order (E.O.) 12549 provides that, to the extent 
permitted by law, Executive departments and agencies shall participate 
in a governmentwide system for nonprocurement debarment and suspension. 
A person who is debarred or suspended shall be excluded from Federal 
financial and nonfinancial assistance and benefits under Federal 
programs and activities. Debarment or suspension of a participant in a 
program by one agency shall have governmentwide effect.
    (b) These regulations implement section 3 of E.O. 12549 and the 
guidelines promulgated by the Office of Management and Budget under 
section 6 of the E.O. by:
    (1) Prescribing the programs and activities that are covered by the 
governmentwide system;
    (2) Prescribing the governmentwide criteria and governmentwide 
minimum due process procedures that each agency shall use;
    (3) Providing for the listing of debarred and suspended 
participants, participants declared ineligible (see definition of 
``ineligible'' in Sec. ________.105), and participants who have 
voluntarily excluded themselves from participation in covered 
transactions;
    (4) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion; and
    (5) Offering such other guidance as necessary for the effective 
implementation and administration of the governmentwide system.
    (c) These regulations also implement Executive Order 12689 (3 CFR, 
1989 Comp., p. 235) and 31 U.S.C. 6101 note (Public Law 103-355, sec. 
2455, 108 Stat. 3327) by--
    (1) Providing for the inclusion in the List of Parties Excluded 
from Federal Procurement and Nonprocurement Programs all persons 
proposed for debarment, debarred or suspended under the Federal 
Acquisition Regulation, 48 CFR Part 9, subpart 9.4; persons against 
which governmentwide exclusions have been entered under this part; and 
persons determined to be ineligible; and
    (2) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion.
    (d) Although these regulations cover the listing of ineligible 
participants and the effect of such listing, they do not prescribe 
policies and procedures governing declarations of ineligibility.
    2. Section ________.105 is amended by adding introductory text, 
removing paragraph designations for the definitions and placing them in 
alphabetical order, removing the [[Page 33041]] definition for 
``Nonprocurement List'', adding, in alphabetical order, a definition 
for ``List of Parties Excluded from Federal Procurement and 
Nonprocurement Programs'', and revising the definitions for 
``Affiliate'', ``Conviction'', and ``Legal proceedings'' to read as 
follows:


Sec. ________.105  Definitions.

    The following definitions apply to this part:
    Affiliate. Persons are affiliates of each other if, directly or 
indirectly, either one controls or has the power to control the other, 
or, a third person controls or has the power to control both. Indicia 
of control include, but are not limited to: interlocking management or 
ownership, identity of interests among family members, shared 
facilities and equipment, common use of employees, or a business entity 
organized following the suspension or debarment of a person which has 
the same or similar management, ownership, or principal employees as 
the suspended, debarred, ineligible, or voluntarily excluded person.
* * * * *
    Conviction. A judgment or conviction of a criminal offense by any 
court of competent jurisdiction, whether entered upon a verdict or a 
plea, including a plea of nolo contendere.
* * * * *
    Legal proceedings. Any criminal proceeding or any civil judicial 
proceeding to which the Federal Government or a State or local 
government or quasi-governmental authority is a party. The term 
includes appeals from such proceedings.
    List of Parties Excluded from Federal Procurement and 
Nonprocurement Programs. A list compiled, maintained and distributed by 
the General Services Administration (GSA) containing the names and 
other information about persons who have been debarred, suspended, or 
voluntarily excluded under Executive Orders 12549 and 12689 and these 
regulations or 48 CFR part 9, subpart 9.4, persons who have been 
proposed for debarment under 48 CFR part 9, subpart 9.4, and those 
persons who have been determined to be ineligible.
* * * * *
    3. Section ________.110 is amended by revising paragraph (c) to 
read as follows:


Sec. ________.110  Coverage.

* * * * *
    (c) Relationship to Federal procurement activities. In accordance 
with E.O. 12689 and section 2455 of Public Law 103-355, any debarment, 
suspension, proposed debarment or other governmentwide exclusion 
initiated under the Federal Acquisition Regulation (FAR) on or after 
August 25, 1995 shall be recognized by and effective for Executive 
Branch agencies and participants as an exclusion under this regulation. 
Similarly, any debarment, suspension or other governmentwide exclusion 
initiated under this regulation on or after August 25, 1995 shall be 
recognized by and effective for those agencies as a debarment or 
suspension under the FAR.
    4. Section ________.200 is revised to read as follows:


Sec. ________.200  Debarment or suspension.

    (a) Primary covered transactions. Except to the extent prohibited 
by law, persons who are debarred or suspended shall be excluded from 
primary covered transactions as either participants or principals 
throughout the Executive Branch of the Federal Government for the 
period of their debarment, suspension, or the period they are proposed 
for debarment under 48 CFR part 9, subpart 9.4. Accordingly, no agency 
shall enter into primary covered transactions with such excluded 
persons during such period, except as permitted pursuant to 
Sec. ________.215.
    (b) Lower tier covered transactions. Except to the extent 
prohibited by law, persons who have been proposed for debarment under 
48 CFR part 9, subpart 9.4, debarred or suspended shall be excluded 
from participating as either participants or principals in all lower 
tier covered transactions (see Sec. ________.110(a)(1)(ii)) for the 
period of their exclusion.
    (c) Exceptions. Debarment or suspension does not affect a person's 
eligibility for--
    (1) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (2) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, and 
entities consisting wholly or partially of foreign governments or 
foreign governmental entities;
    (3) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits 
received in an individual's business capacity are not excepted);
    (4) Federal employment;
    (5) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (6) Incidental benefits derived from ordinary governmental 
operations; and
    (7) Other transactions where the application of these regulations 
would be prohibited by law.
    5. Section ________.215 is revised to read as follows:


Sec. ________.215  Exception provision.

    [Agency] may grant an exception permitting a debarred, suspended, 
or voluntarily excluded person, or a person proposed for debarment 
under 48 CFR part 9, subpart 9.4, to participate in a particular 
covered transaction upon a written determination by the agency head or 
an authorized designee stating the reason(s) for deviating from the 
Presidential policy established by Executive Order 12549 and 
Sec. ________.200. However, in accordance with the President's stated 
intention in the Executive Order, exceptions shall be granted only 
infrequently. Exceptions shall be reported in accordance with 
Sec. ________.505(a).
    6. Section ________.220 is revised to read as follows:


Sec. ________.220  Continuation of covered transactions.

    (a) Notwithstanding the debarment, suspension, proposed debarment 
under 48 CFR part 9, subpart 9.4, determination of ineligibility, or 
voluntary exclusion of any person by an agency, agencies and 
participants may continue covered transactions in existence at the time 
the person was debarred, suspended, proposed for debarment under 48 CFR 
part 9, subpart 9.4, declared ineligible, or voluntarily excluded. A 
decision as to the type of termination action, if any, to be taken 
should be made only after thorough review to ensure the propriety of 
the proposed action.
    (b) Agencies and participants shall not renew or extend covered 
transactions (other than no-cost time extensions) with any person who 
is debarred, suspended, proposed for debarment under 48 CFR part 9, 
subpart 9.4, ineligible or voluntary excluded, except as provided in 
Sec. ________.215.
    7. Section ________.225 is revised to read as follows:


Sec. ________.225  Failure to adhere to restrictions.

    (a) Except as permitted under Sec. ________.215 or 
Sec. ________.220, a participant shall not knowingly do 
[[Page 33042]] business under a covered transaction with a person who 
is--
    (1) Debarred or suspended;
    (2) Proposed for debarment under 48 CFR part 9, subpart 9.4; or
    (3) Ineligible for or voluntarily excluded from the covered 
transaction.
    (b) Violation of the restriction under paragraph (a) of this 
section may result in disallowance of costs, annulment or termination 
of award, issuance of a stop work order, debarment or suspension, or 
other remedies as appropriate.
    (c) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, proposed for debarment under 48 
CFR part 9, subpart 9.4, ineligible, or voluntarily excluded from the 
covered transaction (See Appendix B of these regulations), unless it 
knows that the certification is erroneous. An agency has the burden of 
proof that a participant did knowingly do business with a person that 
filed an erroneous certification.
    8. Appendix A is revised to read as follows:

Appendix A to Part________--Certification Regarding Debarment, 
Suspension, and Other Responsibility Matters--Primary Covered 
Transactions

Instructions for Certification

    1. By signing and submitting this proposal, the prospective 
primary participant is providing the certification set out below.
    2. The inability of a person to provide the certification 
required below will not necessarily result in denial of 
participation in this covered transaction. The prospective 
participant shall submit an explanation of why it cannot provide the 
certification set out below. The certification or explanation will 
be considered in connection with the department or agency's 
determination whether to enter into this transaction. However, 
failure of the prospective primary participant to furnish a 
certification or an explanation shall disqualify such person from 
participation in this transaction.
    3. The certification in this clause is a material representation 
of fact upon which reliance was placed when the department or agency 
determined to enter into this transaction. If it is later determined 
that the prospective primary participant knowingly rendered an 
erroneous certification, in addition to other remedies available to 
the Federal Government, the department or agency may terminate this 
transaction for cause or default.
    4. The prospective primary participant shall provide immediate 
written notice to the department or agency to which this proposal is 
submitted if at any time the prospective primary participant learns 
that its certification was erroneous when submitted or has become 
erroneous by reason of changed circumstances.
    5. The terms covered transaction, debarred, suspended, 
ineligible, lower tier covered transaction, participant, person, 
primary covered transaction, principal, proposal, and voluntarily 
excluded, as used in this clause, have the meanings set out in the 
Definitions and Coverage sections of the rules implementing 
Executive Order 12549. You may contact the department or agency to 
which this proposal is being submitted for assistance in obtaining a 
copy of those regulations.
    6. The prospective primary participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered 
into, it shall not knowingly enter into any lower tier covered 
transaction with a person who is proposed for debarment under 48 CFR 
part 9, subpart 9.4, debarred, suspended, declared ineligible, or 
voluntarily excluded from participation in this covered transaction, 
unless authorized by the department or agency entering into this 
transaction.
    7. The prospective primary participant further agrees by 
submitting this proposal that it will include the clause titled 
``Certification Regarding Debarment, Suspension, Ineligibility and 
Voluntary Exclusion-Lower Tier Covered Transaction,'' provided by 
the department or agency entering into this covered transaction, 
without modification, in all lower tier covered transactions and in 
all solicitations for lower tier covered transactions.
    8. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 
9, subpart 9.4, debarred, suspended, ineligible, or voluntarily 
excluded from the covered transaction, unless it knows that the 
certification is erroneous. A participant may decide the method and 
frequency by which it determines the eligibility of its principals. 
Each participant may, but is not required to, check the List of 
Parties Excluded from Federal Procurement and Nonprocurement 
Programs.
    9. Nothing contained in the foregoing shall be construed to 
require establishment of a system of records in order to render in 
good faith the certification required by this clause. The knowledge 
and information of a participant is not required to exceed that 
which is normally possessed by a prudent person in the ordinary 
course of business dealings.
    10. Except for transactions authorized under paragraph 6 of 
these instructions, if a participant in a covered transaction 
knowingly enters into a lower tier covered transaction with a person 
who is proposed for debarment under 48 CFR part 9, subpart 9.4, 
suspended, debarred, ineligible, or voluntarily excluded from 
participation in this transaction, in addition to other remedies 
available to the Federal Government, the department or agency may 
terminate this transaction for cause or default.

Certification Regarding Debarment, Suspension, and Other 
Responsibility Matters--Primary Covered Transactions

    (1) The prospective primary participant certifies to the best of 
its knowledge and belief, that it and its principals:
    (a) Are not presently debarred, suspended, proposed for 
debarment, declared ineligible, or voluntarily excluded by any 
Federal department or agency;
    (b) Have not within a three-year period preceding this proposal 
been convicted of or had a civil judgment rendered against them for 
commission of fraud or a criminal offense in connection with 
obtaining, attempting to obtain, or performing a public (Federal, 
State or local) transaction or contract under a public transaction; 
violation of Federal or State antitrust statutes or commission of 
embezzlement, theft, forgery, bribery, falsification or destruction 
of records, making false statements, or receiving stolen property;
    (c) Are not presently indicted for or otherwise criminally or 
civilly charged by a governmental entity (Federal, State or local) 
with commission of any of the offenses enumerated in paragraph 
(1)(b) of this certification; and
    (d) Have not within a three-year period preceding this 
application/proposal had one or more public transactions (Federal, 
State or local) terminated for cause or default.
    (2) Where the prospective primary participant is unable to 
certify to any of the statements in this certification, such 
prospective participant shall attach an explanation to this 
proposal.

    9. Appendix B is revised to read as follows:

Appendix B to Part________--Certification Regarding Debarment, 
Suspension, Ineligibility and Voluntary Exclusion--Lower Tier Covered 
Transactions

Instructions for Certification

    1. By signing and submitting this proposal, the prospective 
lower tier participant is providing the certification set out below.
    2. The certification in this clause is a material representation 
of fact upon which reliance was placed when this transaction was 
entered into. If it is later determined that the prospective lower 
tier participant knowingly rendered an erroneous certification, in 
addition to other remedies available to the Federal Government the 
department or agency with which this transaction originated may 
pursue available remedies, including suspension and/or debarment.
    3. The prospective lower tier participant shall provide 
immediate written notice to the person to which this proposal is 
submitted if at any time the prospective lower tier participant 
learns that its certification was erroneous when submitted or had 
become erroneous by reason of changed circumstances.
    4. The terms covered transaction, debarred, suspended, 
ineligible, lower tier covered transaction, participant, person, 
primary covered transaction, principal, proposal, and voluntarily 
excluded, as used in this clause, have the meaning set out in the 
Definitions and Coverage sections of rules implementing Executive 
Order 12549. You may contact the person to which this proposal is 
submitted for assistance in obtaining a copy of those regulations.
    5. The prospective lower tier participant agrees by submitting 
this proposal that, [[Page 33043]] should the proposed covered 
transaction be entered into, it shall not knowingly enter into any 
lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, debarred, suspended, 
declared ineligible, or voluntarily excluded from participation in 
this covered transaction, unless authorized by the department or 
agency with which this transaction originated.
    6. The prospective lower tier participant further agrees by 
submitting this proposal that it will include this clause titled 
``Certification Regarding Debarment, Suspension, Ineligibility and 
Voluntary Exclusion-Lower Tier Covered Transaction,'' without 
modification, in all lower tier covered transactions and in all 
solicitations for lower tier covered transactions.
    7. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 
9, subpart 9.4, debarred, suspended, ineligible, or voluntarily 
excluded from covered transactions, unless it knows that the 
certification is erroneous. A participant may decide the method and 
frequency by which it determines the eligibility of its principals. 
Each participant may, but is not required to, check the List of 
Parties Excluded from Federal Procurement and Nonprocurement 
Programs.
    8. Nothing contained in the foregoing shall be construed to 
require establishment of a system of records in order to render in 
good faith the certification required by this clause. The knowledge 
and information of a participant is not required to exceed that 
which is normally possessed by a prudent person in the ordinary 
course of business dealings.
    9. Except for transactions authorized under paragraph 5 of these 
instructions, if a participant in a covered transaction knowingly 
enters into a lower tier covered transaction with a person who is 
proposed for debarment under 48 CFR part 9, subpart 9.4, suspended, 
debarred, ineligible, or voluntarily excluded from participation in 
this transaction, in addition to other remedies available to the 
Federal Government, the department or agency with which this 
transaction originated may pursue available remedies, including 
suspension and/or debarment.

Certification Regarding Debarment, Suspension, Ineligibility an 
Voluntary Exclusion--Lower Tier Covered Transactions

    (1) The prospective lower tier participant certifies, by 
submission of this proposal, that neither it nor its principals is 
presently debarred, suspended, proposed for debarment, declared 
ineligible, or voluntarily excluded from participation in this 
transaction by any Federal department or agency.
    (2) Where the prospective lower tier participant is unable to 
certify to any of the statements in this certification, such 
prospective participant shall attach an explanation to this 
proposal.
-----------------------------------------------------------------------


OFFICE OF PERSONNEL MANAGEMENT
Adoption of Common Rule

    The agency-specific adoptions of the common rule, which appears at 
the end of the common preamble, appear below.
-----------------------------------------------------------------------

OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 970

RIN 3206-AG51
FOR FURTHER INFORMATION CONTACT: Murray M. Meeker, Attorney, Office of 
the General Counsel, (202) 606-1980.

List of Subjects in 5 CFR Part 970

    Administrative practice and procedure, Contract programs, Grant 
programs.
Lorraine A. Green,
Deputy Director.

    Title 5 of the Code of Federal Regulations, part 970 is amended as 
follows.

PART 970--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT)

    1. The authority for part 970 continues to read as follows:

    Authority: Executive Order 12549 (51 FR 6370-71).

    2. Section 970.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 970.105 and 970.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 970.200, 970.215, 970.220, and 970.225 and Appendices A 
and B to Part 970 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 6325-01
-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

7 CFR Part 3017

RIN 0503-AA11
FOR FURTHER INFORMATION CONTACT:
Gary W. Butler, Deputy Assistant General Counsel, Office of the General 
Counsel, (202) 720-2577.

List of Subjects in 7 CFR Part 3017

    Administrative practice and procedure, Contract programs, Grant 
programs--Agriculture, Grants administration.

    Dated: June 8, 1995.
Dan Glickman,
Secretary of Agriculture.

    Title 7 of the Code of Federal Regulations, part 3017 is amended as 
follows.

PART 3017--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 3017 continues to read as follows:

    Authority: E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701 et 
seq.); 5 U.S.C. 301.

    2. Section 3017.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 3017.105 and 3017.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 3017.200, 307.215, 3017.220, and 3017.225 and 
Appendices A and B to Part 3017 are revised as set forth at the end of 
the common preamble.
BILLING CODE: 3420-01-M
-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

10 CFR Part 1036

RIN 1991-AA69
FOR FURTHER INFORMATION CONTACT: Cynthia Yee, Office of Clearance and 
Support, Office of Procurement and Assistance Management, Human 
Resources and Administration, 202-586-1140.

List of Subjects in 10 CFR Part 1036

     Administrative practice and procedures, Contract programs, Grant 
programs.
Richard H. Hopf,
Deputy Assistant Secretary for Procurement and Assistance Management.

    Title 10 of the Code of Federal Regulations, part 1036 is amended 
as follows:

PART 1036--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1036 continues to read as follows:

    Authority: E.O. 12689; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701 et 
seq.); Secs. 644 and 646, Pub. L. 95-91, 91 Stat. 599 (42 U.S.C. 
7254 and 7256); Pub. L. 97-258, 98 Stat. 1003-1005 (31 U.S.C. 6301-
6308).

    2. Section 1036.100 is revised as set forth at the end of the 
common preamble. [[Page 33044]] 
    3. Sections 1036.105 and 1036.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1036.200, 1036.215, 1036.220, and 1036.225 and 
Appendices A and B to part 1036 are revised as set forth at the end of 
the common preamble.
BILLING CODE: 6450-01-M
-----------------------------------------------------------------------

SMALL BUSINESS ADMINISTRATION

13 CFR Part 145

RIN 3245-AD46
FOR FURTHER INFORMATION CONTACT: John W. Klein, Chief Counsel for 
Special Programs, Office of General Counsel, U.S. Small Business 
Administration, 409 3rd Street, SW, Washington, DC 20416, (202) 205-
6645.

ADDITIONAL SUPPLEMENTARY INFORMATION: As stated in the supplementary 
information to the common rule, the purpose of this rule is to give 
reciprocal governmentwide effect to both nonprocurement and procurement 
debarment and suspension actions. SBA reads revised Sec. 145.110(c) as 
having no effect on the exceptions from coverage already provided for 
in Secs. 145.110(a)(2), 145.215, and 145.220. These exemptions include 
SBA disaster assistance.

List of Subjects in 13 CFR Part 145

    Administrative practice and procedure, Contract programs, Debarment 
and suspension (nonprocurement), Grant programs, Loan programs--
business.

    Dated: June 2, 1995.
Philip Lader,
Administrator.

    Title 13 of the Code of Federal Regulations, Part 145 is amended as 
follows:

PART 145--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for Part 145 continues to read as follows:

    Authority: E.O. 12549; Secs. 5151-5160 of the Drug-Free 
Workplace Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 
U.S.C. 701 et seq.); 15 U.S.C. 634(b)(6).

    2. Section 145.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 145.105 and 145.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 145.200, 145.215, 145.220, and 145.225 and Appendices A 
and B to Part 145 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 8025-01-M
-----------------------------------------------------------------------

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

14 CFR Part 1265

RIN 2700-AB99
FOR FURTHER INFORMATION CONTACT: Thomas J. Wheland, NASA Headquarters, 
Acquisition Liaison Division (Code HP), (202) 358-0475.

List of Subjects in 14 CFR Part 1265

    Administrative practice and procedure, Contract programs, 
Cooperative agreements, Debarment and suspension (nonprocurement), 
Grant programs.
Tom Luedtke,
Deputy Associate Administrator for Procurement.

    Title 14 of the Code of Federal Regulations, Part 1265 is amended 
as follows.

PART 1265--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1265 continues to read as follows:

    Authority: E.O. 12549; Secs. 5151-5160 of the Drug-Free 
Workplace Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 
U.S.C. 701 et seq.); National Aeronautics and Space Act, Pub. L. 85-
568, July 29, 1958, as amended, sec. 203(c)(1).

    2. Section 1265.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 1265.105 and 1265.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1265.200, 1265.215, 1265.220 and 1265.225 and 
Appendices A and B to Part 1265 are revised as set forth at the end of 
the common preamble.
BILLING CODE: 7510-01-M
-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

15 CFR Part 26

RIN 0605-AA02
FOR FURTHER INFORMATION CONTACT: John J. Phelan, III, 202-482-4115.

List of Subjects in 15 CFR Part 26

    Administrative practice and procedure, Contract programs, Grant 
administration, Grant programs, Reporting and recordkeeping 
requirements.
Sonya G. Stewart,
Director for Executive Budgeting and Assistance Management.

    Title 15 of the Code of Federal Regulations, part 26 is amended as 
follows.

PART 26--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT--
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 26 is revised to read as follows:

    Authority: 5 U.S.C. 301; 41 U.S.C. 701 et seq.; Sec. 2455, Pub. 
L. 103-355, 108 Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549, 3 CFR, 
1986 comp., p. 189; E.O. 12689, 3 CFR, 1989 comp., p. 235.

    2. Section 26.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 26.105 and 26.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 26.200, 26.215, 26.220, and 26.225 and Appendices A and 
B to part 26 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 3510-(FA)-M
-----------------------------------------------------------------------

OFFICE OF NATIONAL DRUG CONTROL POLICY

21 CFR Part 1404

RIN 3201-ZA00
FOR FURTHER INFORMATION CONTACT: Edward H. Jurith, General Counsel, 
(202) 395-6709.

List of Subjects in 21 CFR Part 1404

     Administrative practice and procedure, Contract programs, Grant 
programs.
Lee P. Brown,
Director.

    Title 21 of the Code of Federal Regulations, part 1404, is amended 
as follows:

PART 1404--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1404 continues to read as follows:

    Authority: Executive Order 12549, 3 CFR, 1986 Comp., p. 189; 5 
U.S.C. 301; Sec. 5151-5160 of the Drug-Free Workplace Act of 1988 
(Pub. L. 100-690, Title V, Subtitle D, 102 Stat. 4304; 41 U.S.C. 701 
et seq.).

    [[Page 33045]] 2. Section 1404.100 is revised as set forth at the 
end of the common preamble.
    3. Sections 1404.105 and 1404.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1404.200, 1404.215, 1404.220, and 1404.225 and 
Appendices A and B to part 1404 are revised as set forth at the end of 
the common preamble.
BILLING CODE: 3180-02-M
-----------------------------------------------------------------------

DEPARTMENT OF STATE

22 CFR Part 137

RIN 1400-AA55
FOR FURTHER INFORMATION CONTACT: Robert E. Lloyd, Office of the 
Procurement Executive, 703-516-1690.

List of Subjects in 22 CFR Part 137

     Administrative practice and procedure, Contract programs, Grant 
programs.
Lloyd W. Pratsch,
Procurement Executive.

    Title 22 of the Code of Federal Regulations, part 137, is amended 
as follows:

PART 137--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 137 continues to read as follows:

    Authority: E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701 et 
seq.); 22 U.S.C. 2658.

    2. Section 137.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 137.105 and 137.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 137.200, 137.215, 137.220, and 137.225 and Appendices A 
and B to Part 137 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 4710-24-M
-----------------------------------------------------------------------

INTERNATIONAL DEVELOPMENT COOPERATION AGENCY

Agency for International Development

22 CFR Part 208

RIN 0412-AA24
FOR FURTHER INFORMATION CONTACT: Kathleen J. O'Hara, M/OP/P, Telephone 
(703) 875-1534.

List of Subjects in 22 CFR Part 208

     Administrative practice and procedure, Contract programs, Grant 
programs--foreign relations, Grant programs, Loan programs--foreign 
relations.
Marcus L. Stevenson,
Acting Procurement Executive.

    Title 22 of the Code of Federal Regulations, part 208, is amended 
as follows:

PART 208--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 208 continues to read as follows:

    Authority: E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, title V, subtitle D; 41 U.S.C. 701 et 
seq.); Sec. 621, Foreign Assistance Act of 1961, 22 U.S.C. 2381.

    2.Section 208.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 208.105 and 208.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 208.200, 208.215, 208.220, and 208.225 and Appendices A 
and B to Part 208 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 6116-01-M
-----------------------------------------------------------------------

PEACE CORPS

22 CFR Part 310

RIN 0420-AA13
FOR FURTHER INFORMATION CONTACT:
Kirby Mullen, 202-606-3114

List of Subjects in 22 CFR Part 310

    Administrative practice and procedure, Contract programs, Grant 
programs.
Charles R. Baquet, III,
Acting Director.

    Title 22 of the Code of Federal Regulations, part 310 is amended as 
follows.

PART 310--GOVERNMENTWIDE DEPARTMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 310 continues to read as follows:

    Authority: E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, subtitle D; 41 U.S.C. 701 et 
seq.); 22 U.S.C. 2503.

    2. Section 310.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 310.105 and 310.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 310.200, 300.215, 310.220, and 310.225 and Appendices A 
and B to Part 310 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 6051-01-M
-----------------------------------------------------------------------

UNITED STATES INFORMATION AGENCY

22 CFR Part 513

RIN 3116-AA07
FOR FURTHER INFORMATION CONTACT: GEORGIA HUBERT ON (202) 205-5404.

List of Subjects in 22 CFR Part 513 Administrative practice and 
procedure, Contract programs, Grant programs.

Henry Howard, Jr.,
Associate Director for Management.

    The 22 of the code of Federal Regulations, Part 513 is amend as 
follows.

PART 513--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 513 is revised to read as follows:

    Authority: 40 U.S.C. 486 (c); 41 U.S.C. 701 et seq.; Sec. 2455, 
Pub. L. 103-355, 108 Stat. 3327 (31 U.S.C. 6101 note); E. O. 12549, 
3 CFR, 1986 Comp., p. 189; E.O. 12689, 3 CFR, 1989 comp., p. 235.

    2. Section 513.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 513.105 and 513.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 513.200, 513.215, 515.220, and 513.225 and Appendices A 
and B to Part 513 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 8230-01-M
-----------------------------------------------------------------------

INTER-AMERICAN FOUNDATION

22 CFR Part 1006

FOR FURTHER INFORMATION CONTACT: Adolfo A. Franco, 703-841-3894. 
[[Page 33046]] 

List of Subjects in 22 CFR Part 1006

    Administrative practice and procedure, Contract programs, Grant 
programs.
Adolfo A. Franco,
General Counsel.

    Title 22 of the Code of Federal Regulations, part 1006 is amended 
as follows.

PART 1006--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1006 continues to read as follows:

    Authority: E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701 et 
seq.); 22 U.S.C. 290f.

    2. Section 1006.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 1006.105 and 1006.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1006.200, 1006.215, 1006.220 and 1006.225 and 
Appendices A and B to Part 1006 are revised as set forth at the end of 
the common preamble.
BILLING CODE: 7025-01-M
-----------------------------------------------------------------------

AFRICAN DEVELOPMENT FOUNDATION

22 CFR Part 1508

for further information contact: Paul S. Magid, (202) 673-3916.

List of Subjects in 22 CFR Part 1508

    Administrative practice and procedure, Contract programs, Grant 
programs--foreign relations.
William R. Ford,
President.

    Title 22 of the Code of Federal Regulations, Part 1508 is amended 
as follows:

PART 1508--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1508 is revised to read as follows:

    Authority: 22 U.S.C. 290h; 41 U.S.C. 701 et seq.; E.O. 12549, 3 
CFR, 1986 comp., p. 189.

    2. Section 1508.100 is revised as set forth at the end of the 
common preamble.
    3. Section 1508.105 and 1508.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1508.200, 1508.215, 1508.220, and 1508.225 and 
Appendices A and B to Part 1508 are revised as set forth at the end of 
the common preamble.
BILLING CODE: 6117-01-M
-----------------------------------------------------------------------

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 24

RIN 2501-AB24
FOR FURTHER INFORMATION CONTACT: Emmett N. Roden, Assistant General 
Counsel for Administrative Proceedings, Office of General Counsel, U.S. 
Department of Housing and Urban Development, 451 7th Street, SW., Room 
10251, Washington, DC 20410, telephone (202) 708-2350. The telephone 
number for the hearing impaired (TDD) is (202) 708-9300. These are not 
toll-free numbers.

ADDITIONAL SUPPLEMENTARY INFORMATION: In accordance with Executive 
Order 12549, the Department, along with other Federal agencies, 
promulgated governmentwide nonprocurement debarment and suspension 
regulations. The common rule, which is identical to the Office of 
Management and Budget's final guidelines, and the various agency-
specific supplements to the common rule were published at the same time 
on May 26, 1988 (53 FR 19161). The provisions of the common rule that 
provide nonprocurement participants with the opportunity to contest 
suspensions and proposed debarments and the procedures by which 
suspending and debarring officials make final agency determinations are 
substantially similar to the procedures applicable to procurement 
contractors under the Federal Acquisition Regulation (FAR, 48 CFR, 
especially subpart 9.4 thereof). Although the Department adopted 
verbatim significant portions of the common rule, it did not include 
all of the provisions concerning suspension and debarment hearing 
procedures or the reconsideration or appeal of post-hearing 
determinations.
    Executive Order 12689, issued in 1989, and section 2455 of the 
Federal Acquisition Streamlining Act of 1994 require that the 
debarment, suspension, or other exclusion of a participant in a 
procurement activity under the FAR, or in a nonprocurement activity 
under an agency's debarment regulations, shall, after regulations are 
issued, have the governmentwide effect of excluding the participant 
from both procurement and nonprocurement activities. Under current HUD 
rules, a debarment of a nonprocurement participant does not affect such 
person's participation in procurement activities with other agencies.
    On December 20, 1994, HUD and other agencies participating in the 
development of this final rule published a notice of proposed 
rulemaking to implement Executive Order 12689 and section 2455 of the 
Federal Acquisition Streamlining Act. HUD's portion of the proposed 
rule, published at 59 FR 65612, also included revisions to conform the 
Department's hearing procedures to those of the common rule.
    The Department's current hearing procedures, which depart from the 
generally applicable governmentwide provisions, have adversely affected 
the Department's ability to process suspensions and debarments in an 
efficient and cost-effective manner. The amount of time and expense 
currently involved in the Department's suspension and debarment 
proceedings benefit neither the Department nor the persons who are 
subject to such sanctions. In addition, the Department notes that the 
common rule procedures have not been successfully challenged in Federal 
court since their implementation in 1988.
    The issuance of this rule will simplify and streamline the 
suspension, debarment, and limited denial of participation processes at 
HUD. Therefore, this rule will reduce, rather than increase, the 
regulatory burden on contractors and participants in the Department's 
programs.
    The Department considers these changes necessary to comply with the 
President's directive to streamline agency operations throughout the 
Executive Branch. The revisions are also an element in the Government 
reinvention process at the Department.
    Effective date: The final rule shall apply to notices of proposed 
debarment, suspension and limited denial of participation that are 
issued on or after the effective date of this rule.
Discussion of Public Comments

    Comments on the proposed rule were received from one Federal 
Government organization, from one private professional organization, 
and from three individuals. The issues raised by the commenters are 
summarized below. [[Page 33047]] 

Recommendations by the Administrative Conference of the United 
States (ACUS)

    Comment: Four of the five commenters refer to recommendations 
recently issued by ACUS (Recommendation 95-2, ``Debarment and 
Suspension from Federal Programs,'' adopted January 19, 1995) and urge 
that HUD conform its regulations to the ACUS Recommendations. In 
particular, the commenters urge compliance with item II of the 
Recommendations. This item recommends that cases involving disputed 
issues of material fact be referred to administrative law judges, 
military judges, administrative judges of boards of contract appeals or 
similarly independent hearing officers for hearings and preparation of 
(1) findings of fact certified to the debarring official, or (2) a 
recommended decision to the debarring official, or (3) an initial 
decision, subject to agency appeal. Item II of the ACUS Recommendations 
also recommends that debarring officials be senior agency officials who 
are guaranteed sufficient independence to provide due process, and that 
such officials ensure that information used as the basis for a sanction 
appear in the administrative record of the decision.
    The commenters expressed concern that the use of ``hearing 
officials'' who are not administrative judges would result in the 
deprivation of due process. They criticized these officials as being 
neither trained in the law nor versed in HUD's programs.
    One commenter also urged HUD to adopt item III of the ACUS 
Recommendation. Item III lists various recommendations for future 
rulemaking: (1) that entities coordinating the FAR and the common rule, 
and individual agencies, provide for a list of mitigating and 
aggravating factors; (2) establishment of a process for determining a 
lead agency when a person deals with more than one agency; (3) minimum 
evidentiary thresholds for procurement debarment; (4) notice to 
affected persons of the impact of sanctions; and (5) use of ``show 
cause'' warning letters.
    Response: The rule satisfies the ACUS recommendation that debarring 
officials be senior, independent agency officials. Notices of 
suspension and proposed debarment are, under delegations by the 
Secretary of HUD, issued by Assistant Secretaries, the Inspector 
General, and the President of the Government National Mortgage 
Association. These officials are the highest responsible officials for 
major components of the Department. They report directly to the 
Secretary. These officials are not subject to the supervision of, nor 
do they directly supervise, agency personnel who carry out 
investigative or prosecutive activities. Their ability to make 
independent debarment decisions is thus evident from their position.
    The Department has revised the rule to address the comments 
concerning referral of disputes of material fact. The revision deletes 
the references to ``hearing official.'' The specific HUD-only additions 
to the common rule, at Secs. 24.314(b)(2)(i) and 24.413(b)(3), clarify 
that disputes of material fact may be referred to ``hearing officers'' 
who are defined as administrative law judges or members of the HUD 
Board of Contract Appeals. In accordance with the first option listed 
in ACUS Recommendation item II, the hearing officers will provide 
findings of fact to the suspending or debarring official. In addition, 
the final rule provides that the suspending or debarring official may, 
in his or her discretion, refer cases based upon indictment, conviction 
or civil judgment, or cases in which there is no dispute of material 
fact, to the hearing officer for appropriate findings.
    The final rule is in conformity with the other elements of ACUS 
Recommendation 95-2 to the extent possible in the context of a 
coordinated governmentwide system. Recommendation item IV urges that 
all federal agencies adopt the common rule. By conforming its hearing 
procedures to those of the common rule, HUD has followed the ACUS 
suggestion. By coordinating procurement and non-procurement suspension 
and debarment, HUD has followed the suggestion of ACUS in 
Recommendation item I.
    HUD has agreed to consider ACUS Recommendation item III, along with 
other proposed changes to the common rule, before the end of this year. 
Certain of the item III suggestions, such as appropriate notice to 
respondents and the use of ``show cause'' letters, will in any event be 
considered by HUD as new procedures are adopted under the regulatory 
revision.
    Finally, ACUS Recommendation item V addresses Congress rather than 
the executive branch agencies.
Consideration of Mitigating Factors in Debarment Proceedings

    Comment: Two commenters asserted that the proposed rule had 
eliminated all references to mitigating factors as an element of the 
suspension and debarment process.
    Response: These comments may be based on the elimination of 
paragraph (d) in 24 C.F.R. Sec. 24.115, which refers to consideration 
of mitigating factors in the debarment of contractors. This deletion is 
the result of coordination of procurement and non-procurement 
debarment.
    Mitigation will, necessarily, continue to be an element in HUD's 
suspension and debarment process. Most importantly, 24 C.F.R. 
Sec. 24.300 will continue to require consideration of the seriousness 
of the ``person's'' acts and ``any mitigating factors.'' In addition, 
the provisions of 24 C.F.R. Sec. 24.314, referring to the inclusion of 
``any evidence of mitigating circumstances,'' are expanded under the 
proposed rule and this final rule by requiring consideration of ``any 
information and argument'' submitted by the respondent. (See 
Secs. 24.313(a) and 24.314(a) and (b)(1).) The opportunity to submit, 
for review, evidence of mitigation as well as any other information is 
thus well preserved.

Limits on Discovery and Use of Alternative Dispute Resolution

    Comment: Two commenters proposed that the Department impose limits 
on discovery as a means of streamlining the hearing process. One 
commenter further recommended that the rule provide for the use of 
alternative dispute resolution. The commenters stated that these 
changes would reduce costs to the Department and to participants while 
increasing efficiency.
    Response: The Department's current rule allows the use of discovery 
pursuant to the provisions of 24 CFR Part 26. In the final rule, cases 
that the suspending or debarring official does not refer to hearing 
officers shall not be subject to formal discovery, but instead shall be 
limited to information in the administrative record, including any 
submissions by the respondent. (See Secs. 24.314(a) and (b) and 
24.413(a) and (b).)
    The discovery provisions of Part 26 shall continue to apply to 
those cases that are referred to a hearing officer for findings of 
fact. (See Secs. 24.314(b)(2)(i) and 24.413(b)(3).) However, 24 CFR 
Sec. 26.17 provides that ``discovery shall not be permitted where it 
will unduly delay the hearing, thereby resulting in prejudice to the 
public interest or the rights of the parties.'' In addition, the final 
rule procedures at Secs. 24.314(b)(2)(ii) and 24.413(b)(4) will require 
that the hearing in a case referred to the hearing officer commence 
within 45 days of referral, unless both parties agree to an extension 
of time. The Department is also required to compile an administrative 
record prior to hearing, and to provide a copy to the respondent. This 
record will contain all [[Page 33048]] information that the debarring 
official relied upon in issuing the suspension or proposed debarment.
    The 45-day requirement and use of an administrative record, coupled 
with the existing part 26 restrictions, should eliminate protracted 
discovery. At the same time, the rule is sufficiently flexible to allow 
an extended period of discovery if the parties mutually agree to extend 
the 45-day limit. However, if these provisions prove inadequate, the 
Department agrees to consider limitations on discovery in future 
rulemaking.
    The Department agrees with the comment recommending alternative 
dispute resolution. Provisions for voluntary use of alternative dispute 
resolution have been added to the final rule. The Department has 
determined that this section does not impose any restrictions on 
existing rights of HUD participants, but rather serves to expand the 
methods for resolving disputes. Accordingly, the Department believes 
there is good cause for promulgating this provision in a final rule, 
rather than through a proposed rule.

Creation of an Office To Chair Informal Conferences for Limited 
Denials of Participation

    Comment: One commenter proposed that the Department establish a new 
office to chair informal conferences for limited denials of 
participation. The commenter stated that, under the existing process, 
the official presiding over the conference is often the person who 
initiated the sanction, and therefore may be biased against the 
respondent.
    Response: The Department has addressed this concern by revising the 
proposed rule to allow the respondent to by-pass the informal 
conference and proceed directly to a hearing before a hearing officer.

List of Subjects in 24 CFR Part 24

    Administrative practice and procedure, Contract programs, Drug 
abuse, Government contracts, Grant programs, Government procurement, 
Loan programs, Reporting and recordkeeping requirements.
Henry G. Cisneros,
Secretary.
    Title 24 of the Code of Federal Regulations, part 24 is amended as 
follows:

PART 24--GOVERNMENT DEBARMENT AND SUSPENSION AND GOVERNMENTWIDE 
REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 24 is revised to read as follows:

    Authority: 41 U.S.C. 701 et seq.; 42 U.S.C. 3535(d); E.O. 12549, 
51 FR 6370, 3 CFR, 1986 Comp., p. 189; E.O. 12689, 54 FR 34131, 3 
CFR, 1989 Comp., p. 235.

    2. Section 24.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 24.105 and 24.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 24.200, 24.215, 24.220, 24.225 and Appendices A and B 
to Part 24 are revised as set forth at the end of the common preamble.
    5. Section 24.100 is further amended by adding paragraphs (e) and 
(f), to read as follows:


Sec. 24.100  Purpose.

* * * * *
    (e) These regulations also:
    (1) Prescribe policies and procedures governing the debarment and 
suspension of contractors and the limited denial of participation of 
participants and contractors;
    (2) Provide for the listing of debarred, suspended and ineligible 
contractors; and
    (3) Set forth the consequences of such listing.
    (f) Although this part covers the listing of ineligible 
contractors, it does not prescribe policies and procedures governing 
declarations of ineligibility.
    6. Section 24.105 is further amended by removing paragraphs (1) and 
(2) under the definitions of ``Debarment,'' ``Suspension'' and 
``Voluntary exclusion or voluntarily excluded'' and by revising the 
definitions for ``Limited denial of participation,'' and ``Respondent'' 
to read as follows:


Sec. 24.105  Definitions.

* * * * *
    Limited denial of participation. An action taken by a HUD official, 
in accordance with subpart G of these regulations, that immediately 
excludes or restricts a person from participating in HUD program(s) 
within a defined geographic area.
* * * * *
    Respondent. A person against whom a debarment or suspension action 
has been initiated.
    (1) A respondent is also a person against whom a limited denial of 
participation has been initiated.
    (2) [Reserved].
* * * * *
    7. Section 24.110 is further amended by adding a paragraph 
(a)(1)(i)(A)(3) and a paragraph (a)(3), and by revising the last 
sentence of paragraph (d), to read as follows:


Sec. 24.110  Coverage.

    (a) * * *
    (1) Covered transaction. * * *
    (i) * * *
    (A) * * *
    (3) Any procurement transaction between HUD and a person.
* * * * *
    (3) Other exceptions. (i) Sanctions against participants whose only 
involvement in HUD programs is as ultimate beneficiaries, such as 
subsidized tenants and subsidized mortgagors, may be taken only upon 
commission of one of the offenses set forth in Sec. 24.305(a), unless 
the participant has otherwise been debarred or suspended by another 
Federal agency.
    (ii) Sanctions under this part against mortgagees approved by HUD 
to participate in Federal Housing Administration programs may be 
initiated only with the approval of the Mortgagee Review Board.
* * * * *
    (d) * * * The consequences of a debarment or suspension as set 
forth in Sec. 24.200 apply to contractors in Federal procurement 
programs, and Secs. 24.325 and 24.420 govern the extent to which a 
specific contractor or its organizational elements would be included 
within a debarment or suspension action.
* * * * *


Sec. 24.115  [Amended]
    8. In Sec. 24.115, paragraph (d) is removed.
    9. Section 24.200 is further amended by adding new paragraphs 
(c)(8), (c)(9) and (d), to read as follows:


Sec. 24.200  Debarment or suspension.

* * * * *
    (c) Exceptions. * * *
* * * * *
    (8) Debarment for any of the causes set forth in Sec. 24.305(f) 
shall have no governmentwide effect.
    (9) Sanctions imposed on an individual participant under this part 
shall not preclude the participant from selling his or her principal 
residence to a purchaser using HUD/FHA financing.
    (d) Relationship to HUD administrative sanction procedures.-- (1) 
Sanctions provided pursuant to contract provisions. Nothing in this 
part [[Page 33049]] shall impair or limit the right to impose any 
sanction provided for by contract, including guaranty agreements with 
the Government National Mortgage Association.
    (2) Other Departmental sanctions. Where an office of the Department 
is required by statute, regulation, or Executive Order to follow 
administrative sanction procedures that may differ from the 
requirements of this part, the requirements of the statute, regulation, 
or Executive Order shall take precedence. These alternative procedures 
include, but are not limited to: 24 CFR part 200 Previous Participation 
Review and Clearance procedures, 24 CFR part 25 Mortgagee Review Board 
administrative actions, and 24 CFR part 570 Community Development Block 
Grant corrective and remedial actions.
    10. In Sec. 24.305, paragraph (d) is revised to read as follows:


Sec. 24.305  Causes for debarment.

* * * * *
    (d) Any other cause of so serious or compelling a nature that it 
affects the present responsibility of a person.
* * * * *
    11. Section 24.313 is revised to read as follows:


Sec. 24.313  Opportunity to contest proposed debarment.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of proposed debarment, the respondent may submit, in person, in 
writing, or through a representative, information and argument in 
opposition to the proposed debarment.
    (1) The information and argument should be addressed to the 
Debarment Docket Clerk, Department of Housing and Urban Development, 
451 Seventh Street, SW., Washington, DC 20410.
    (2) If the respondent does not contest the proposed debarment 
within the 30 day period, the proposed debarment shall become final.
    (3) If the respondent desires a hearing, it shall submit a written 
request to the Debarment Docket Clerk within the 30-day period 
following receipt of the notice of proposed debarment.
    (4) The parties may agree to engage in an alternative dispute 
resolution, including informal conference, mediation, conciliation, 
summary trial with binding decision, minitrial, or use of a settlement 
judge.
    (b) Additional proceedings as to disputed material facts. (1) In 
actions not based upon a conviction or civil judgment, if the debarring 
official finds that the respondent's submission in opposition raises a 
genuine dispute over facts material to the proposed debarment, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents.
    (2) A transcribed record of any additional proceedings shall be 
made available at cost to the respondent, upon request, unless the 
respondent and the agency, by mutual agreement, waive the requirement 
for a transcript.
    (i) Upon the agreement of the parties, the additional proceedings 
may be recorded using audiotape without transcription. The audiotape 
shall be made available at cost to the respondent.
    (ii) [Reserved].
    12. Section 24.314 is revised to read as follows:


Sec. 24.314  Debarring official's decision.

    (a) No additional proceedings necessary. In actions based upon a 
conviction or civil judgment, or in which there is no genuine dispute 
over material facts, the debarring official shall make a decision on 
the basis of all the information in the administrative record, 
including any submission made by the respondent. The decision shall be 
made within 45 days after receipt of any information and argument 
submitted by the respondent, unless the debarring official extends this 
period for good cause.
    (1) The debarring official may, in his or her discretion, refer 
actions based upon a conviction or civil judgment, or in which there is 
no genuine dispute over material facts, to a hearing officer or other 
official for review of the administrative record and appropriate 
findings. The hearing officer or other official shall issue such 
findings within 45 days after the referral, and the debarring official 
shall issue a decision within 15 days after the date of the findings, 
unless such periods are extended for good cause.
    (2) [Reserved].
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The debarring 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The debarring official may refer disputed material facts to 
another official for findings of fact. The debarring official may 
reject any such findings, in whole or in part, only after specifically 
determining them to be arbitrary and capricious or clearly erroneous.
    (i) The debarring official may refer disputed material facts and 
issues of law to a hearing officer for findings of fact and conclusions 
of law.
    (A) No appeal to the Secretary may be taken under Secs. 26.24 
through 26.26 of this title with respect to any order or decision by a 
hearing officer or other official.
    (B) The debarring official shall provide the hearing officer or 
other official with all the information in the administrative record, 
including any information and argument submitted by the respondent. The 
administrative record and any documents admitted at the hearing shall 
constitute the exhibits in evidence.
    (ii) Unless the parties mutually agree to extend this period, a 
proceeding before a hearing officer or other official shall commence 
within 45 days after referral of the case by the debarring official. 
The hearing officer or other official shall issue findings of fact 
within 30 days after the conclusion of such additional proceedings. The 
time limitations of this subparagraph may be extended upon issuance, by 
the debarring official, hearing officer or other official, of a written 
notice describing good cause for such extension.
    (3) The debarring official's decision shall be made after the 
conclusion of the proceedings with respect to the disputed facts.
    (i) Such decision shall be made within 15 days after the hearing 
officer or other official issues findings of fact.
    (ii) [Reserved].
    (c)(1) Standard of proof. In any debarment action, the cause for 
debarment must be established by a preponderance of the evidence. Where 
the proposed debarment is based upon a conviction or civil judgment, 
the standard shall be deemed to have been met.
    (2) Burden of proof. The burden of proof is on the agency proposing 
debarment.
    (d) Notice of debarring official's decision. (1) If the debarring 
official decides to impose debarment, the respondent shall be given 
prompt notice:
    (i) Referring to the notice of proposed debarment;
    (ii) Specifying the reasons for debarment;
    (iii) Stating the period of debarment, including effective dates; 
and
    (iv) Advising that the debarment is effective for covered 
transactions throughout the executive branch of the 
[[Page 33050]] Federal Government unless an agency head or an 
authorized designee makes the determination referred to in Sec. 24.215.
    (A) Where a debarment is based solely on Sec. 24.305(f), the notice 
of the debarring official's decision shall advise that the debarment is 
effective for programs or activities of the Department.
    (B) [Reserved].
    (2) If the debarring official decides not to impose debarment, the 
respondent shall be given prompt notice of that decision. A decision 
not to impose debarment shall be without prejudice to a subsequent 
imposition of debarment by any other agency.


Sec. 24.400  [Amended]

    13. In Sec. 24.400, paragraph (d) is removed.


Sec. 24.410  [Amended]

    14. In Sec. 24.410, paragraph (c) is removed.
    15. Section 24.411 is revised to read as follows:


Sec. 24.411  Notice of suspension.

    When a respondent is suspended, notice shall immediately be given:
    (a) That the suspension has been imposed;
    (b) That the suspension is based on an indictment, conviction, or 
other adequate evidence that the respondent has committed 
irregularities seriously reflecting on the propriety of further Federal 
Government dealings with the respondent;
    (c) Describing any such irregularities in terms sufficient to put 
the respondent on notice without disclosing the Federal Government's 
evidence;
    (d) Of the cause(s) relied upon under Sec. 24.405 for imposing 
suspension;
    (e) That the suspension is for a temporary period pending the 
completion of an investigation or ensuing legal, debarment or Program 
Fraud Civil Remedies Act proceedings;
    (f) Of the provisions of Secs. 24.411 through 24.413 and any other 
HUD procedures, if applicable, governing suspension decisionmaking; and
    (g) Of the effect of the suspension.
    16. Section 24.412 is revised to read as follows:


Sec. 24.412  Opportunity to contest suspension.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of suspension, the respondent may submit, in person, in writing, 
or through a representative, information and argument in opposition to 
the suspension.
    (1) The information and argument should be addressed to the 
Debarment Docket Clerk, Department of Housing and Urban Development, 
451 Seventh Street, S.W., Washington, D.C. 20410.
    (2) If the respondent does not contest the suspension within the 30 
day period, the suspension shall become final.
    (3) If the respondent desires a hearing, it shall submit a written 
request to the Debarment Docket Clerk within the 30-day period 
following receipt of the notice of suspension.
    (4) The parties may agree to engage in an alternative dispute 
resolution, including informal conference, mediation, conciliation, 
summary trial with binding decision, minitrial, or use of a settlement 
judge.
    (b) Additional proceedings as to disputed material facts. (1) If 
the suspending official finds that the respondent's submission in 
opposition raises a genuine dispute over facts material to the 
suspension, respondent(s) shall be afforded an opportunity to appear 
with a representative, submit documentary evidence, present witnesses, 
and confront any witnesses the agency presents, unless:
    (i) The action is based on an indictment, conviction or civil 
judgment; or
    (ii) A determination is made, on the basis of Department of Justice 
advice, that the substantial interests of the Federal Government in 
pending or contemplated legal proceedings based on the same facts as 
the suspension would be prejudiced.
    (2) A transcribed record of any additional proceedings shall be 
prepared and made available at cost to the respondent, unless the 
respondent and the agency, by mutual agreement, waive the requirement 
for a transcript.
    (i) Upon the agreement of the parties, the additional proceedings 
may be recorded using audiotape without transcription. The audiotape 
shall be made available at cost to the respondent.
    (ii) [Reserved].
    17. Section 24.413 is revised to read as follows:


Sec. 24.413  Suspending official's decision.

    The suspending official may modify or terminate the suspension (see 
Sec. 24.320(c) for reasons for reducing the period or scope of 
debarment) or may leave it in force. However, a decision to modify or 
terminate the suspension shall be without prejudice to the subsequent 
imposition of suspension by any other agency or debarment by any 
agency. The decision shall be rendered in accordance with the following 
provisions:
    (a) No additional proceedings necessary. In actions based upon an 
indictment, conviction, or civil judgment, in which there is no genuine 
dispute over material facts, or in which additional proceedings to 
determine disputed material facts have been denied on the basis of 
Department of Justice advice, the suspending official shall make a 
decision on the basis of all the information in the administrative 
record, including any submission made by the respondent. The decision 
shall be made within 45 days after receipt of any information and 
argument submitted by the respondent, unless the suspending official 
extends this period for good cause.
    (1) The suspending official may, in his or her discretion, refer 
actions based upon an indictment, conviction or civil judgment, or in 
which there is no genuine dispute over material facts, to a hearing 
officer or other official for review of the administrative record and 
appropriate findings. The hearing officer or other official shall issue 
such findings within 45 days after the referral, and the suspending 
official shall issue a decision within 15 days after the date of such 
findings, unless such periods are extended for good cause.
    (2) [Reserved].
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The suspending 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The suspending official may refer matters involving disputed 
material facts to another official for findings of fact. The suspending 
official may reject any such findings, in whole or in part, only after 
specifically determining them to be arbitrary or capricious or clearly 
erroneous.
    (3) The suspending official may refer disputed material facts and 
issues of law to a hearing officer for findings of fact and conclusions 
of law.
    (i) No appeal to the Secretary may be taken under Secs. 26.24 
through 26.26 of this title with respect to any order or decision by a 
hearing officer or other official.
    (ii) The suspending official shall provide the hearing officer or 
other official with all the information in the administrative record, 
including any information and argument submitted by [[Page 33051]] the 
respondent. The administrative record and any documents admitted at the 
hearing shall constitute the exhibits in evidence.
    (4) Unless the parties mutually agree to extend this period, a 
proceeding before a hearing officer or other official shall commence 
within 45 days after referral of disputed material facts and issues of 
law by the suspending official. The hearing officer or other official 
shall issue findings of fact within 30 days after the conclusion of 
such additional proceedings. The time limitations of this subparagraph 
may be extended upon issuance, by the suspending official, other 
official or hearing officer, of a written notice describing good cause 
for such extension.
    (5) The suspending official's decision shall be made within 15 days 
after the hearing officer or other official issues findings of fact.
    (c) Notice of suspending official's decision. Prompt written notice 
of the suspending official's decision shall be sent to the respondent.


Sec. 24.415  [Amended]

    18. In Sec. 24.415, paragraph (d) is removed.


Sec. 24.705  [Amended]

    19. In Sec. 24.705, paragraph (c) is amended to remove the words 
``regional or field''.


Sec. 24.710  [Amended]

    20. In Sec. 24.710, paragraph (a)(3) is amended to remove the words 
``the Deputy Assistant Secretary for Single Family Housing'' and add, 
in their place, the words ``an Assistant Secretary or Deputy Assistant 
Secretary''.
    21. Section 24.711 is revised to read as follows:


Sec. 24.711  Notice of limited denial of participation.

    A limited denial of participation shall be made effective by 
advising the participant or contractor, and any specifically named 
affiliate, by mail, return receipt requested:
    (a) That the limited denial of participation is being imposed;
    (b) Of the cause(s) under Sec. 24.705 for the sanction;
    (c) Of the potential effect of the sanction, including the length 
of the sanction and the HUD program(s) and geographic area affected by 
the sanction;
    (d) Of the right to request, in writing, within 30 days of receipt 
of the notice, a conference under Sec. 24.712; and
    (e) Of the right to contest the limited denial of participation 
under Sec. 24.713.
    22. Section 24.712 is revised to read as follows:


Sec. 24.712  Conference.

    Within 30 days after receiving a notice of limited denial of 
participation, the respondent may request a conference with the 
official who issued such notice. If the respondent does not request a 
conference, the respondent shall nevertheless have the right to contest 
the limited denial of participation under the provisions of 
Sec. 24.713. The conference shall be held within 15 days after the 
Department's receipt of the request for a conference, unless the 
respondent waives this time limit. The official who imposed the 
sanction, or his or her designee, shall preside. At the conference, the 
respondent may appear with a representative and may present all 
relevant information and materials to the official or designee. Within 
20 days after the conference, or within 20 days after any agreed upon 
extension of time for submission of additional materials by the 
respondent, the official or designee shall, in writing, advise the 
respondent of the decision to terminate, modify, or affirm the limited 
denial of participation. If all or a portion of the remaining period of 
exclusion is affirmed, the notice of affirmation shall advise the 
respondent of the opportunity to contest the notice pursuant to 
Sec. 24.713. If the official or designee does not issue a decision 
within the 20-day period, the respondent may contest the sanction under 
Sec. 24.713.
    23. Section 24.713 is revised to read as follows:


Sec. 24.713  Opportunity to contest the limited denial of 
participation.

    (a) Submission in opposition. (1) The respondent may request a 
hearing before a hearing officer:
    (i) Within 30 days after receipt of a notice of affirmation of all 
or a portion of the remaining period of exclusion under a limited 
denial of participation; or
    (ii) Within 30 days after receipt of a notice of a limited denial 
of participation where the respondent elects not to request a 
conference under Sec. 24.712.
    (2) The request must be addressed to the Debarment Docket Clerk, 
Department of Housing and Urban Development, 451 Seventh Street, SW., 
Washington, DC 20410.
    (3) If the respondent does not submit the request within the 30-day 
period, the sanction shall become final.
    (b) Procedures. The hearing shall be conducted in accordance with 
the procedures of Secs. 24.313 and 24.314 Within 15 days of the hearing 
officer's issuance of findings of fact and a recommended decision, the 
official who issued the limited denial of participation shall issue a 
decision.
    (c) Effect of suspension or debarment on limited denial of 
participation. If a respondent has submitted a request for a hearing 
pursuant to paragraph (a) of this section, and if the respondent has 
also received, pursuant to subpart C or D of this part, a notice of 
proposed debarment or suspension that is based on the same 
transaction(s) or conduct as the limited denial of participation, the 
following rules shall apply:
    (1) If the respondent has not contested the proposed debarment 
pursuant to Sec. 24.313(a) or the suspension pursuant to 
Sec. 24.412(a), the final imposition of the debarment or suspension 
shall also constitute a final decision with respect to the limited 
denial of participation to the extent that the debarment or suspension 
is based on the same transaction(s) or conduct as the limited denial of 
participation.
    (2) If the respondent has contested the proposed debarment pursuant 
to Sec. 24.313(a), or the suspension pursuant to Sec. 24.412(a), the 
proceedings shall be consolidated and the debarring or suspending 
official shall issue a final decision as to both the limited denial of 
participation and the debarment or suspension.
    24. A new section 24.714 is added to read as follows:


Sec. 24.714  Reporting of limited denial of participation.

    When a limited denial of participation has been made final, or the 
period for requesting a conference pursuant to Sec. 24.712 has expired 
without receipt of such a request, the official imposing the limited 
denial of participation shall notify the Director of the Participation 
and Compliance Division in the Office of Housing of the scope of the 
limited denial of participation.
BILLING CODE: 4210-32-P
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DEPARTMENT OF JUSTICE

28 CFR Part 67

[A.G. Order No. 1972-95]
FOR FURTHER INFORMATION CONTACT: Cynthia J. Schwimer, Director, 
Financial Management Division, 202-307-3186.

List of Subjects in 28 CFR Part 67

    Administrative practice and procedure, Contract programs, Grant 
programs.

    [[Page 33052]] Dated: June 1, 1995.
Janet Reno,
Attorney General.

    Title 28 of the Code of Federal Regulations, part 67, is amended as 
follows:

PART 67--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 67 continues to read as follows:

    Authority: E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701 et 
seq.), Omnibus Crime Control and Safe Streets Act of 1968, 42 U.S.C. 
3711 et seq. (as amended); Juvenile Justice and Delinquency 
Prevention Act of 1974, 42 U.S.C. 5601 et seq. (as amended); Victims 
of Crime Act of 1984, 42 U.S.C. 10601 et seq. (as amended); 18 
U.S.C. 4042; and 18 U.S.C. 4351-4353.

    2. Section 67.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 67.105 and 67.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 67.200, 67.215, 67.220, and 67.225 and Appendices A and 
B to Part 67 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 4410-18-M
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DEPARTMENT OF LABOR

29 CFR Part 98

RIN 1291-AA23
FOR FURTHER INFORMATION CONTACT: Melvin Goldberg, Chief, Division of 
Procurement and Grant Policy, (202) 219-9174.

List of Subjects in 29 CFR Part 98

    Administrative practice and procedure, Contract programs, Grants 
programs.
Cynthia A. Metzler,
Assistant Secretary for Administration and Management.

    Title 27 of the Code of Federal Regulations, part 98, is amended as 
follows:

PART 98--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 98 continues to read as follows:

    Authority: E.O. 12549; Sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, title V, subtitle D; 41 U.S.C. 701 et 
seq.); 5 U.S.C. 552-556.

    2. Section 98.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 98.105 and 98.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 98.200, 98.215, 98.220, and 98.225 and Appendices A and 
B to Part 98 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 4510-23-M
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FEDERAL MEDIATION AND CONCILIATION SERVICE

29 CFR Part 1471

RIN 3076-AA03
FOR FURTHER INFORMATION CONTACT: Peter Regner, (202) 606-8181.

List of Subjects in 29 CFR Part 1471

    Administrative practice and procedure, Contract programs, Grant 
programs.
Floyd L. Wood,
Deputy Director.

    Title 29 of the Code of Federal Regulations, part 1471 is amended 
as follows.

PART 1471--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1471 continues to read as follows:

    Authority: E.O. 12549; secs. 5151-5160 of the Drug-Free 
Workplace Act of 1988 (Pub. L. 100-690, title V, subtitle D; 41 
U.S.C. 701 et seq.); Pub. L. 95-524, Oct. 27, 1978, 29 U.S.C. 175a.

    2. Section 1471.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 1471.105 and 1471.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1471.200, 1471.215, 1471.220, and 1471.225 and 
Appendices A and B to Part 1471 are revised as set forth at the end of 
the common preamble.

BILLING CODE: 6372-01-M
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DEPARTMENT OF THE TREASURY

31 CFR Part 19

RIN 1505-AA57
FOR FURTHER INFORMATION CONTACT: William Murphy at (202) 622-0450.

List of Subjects in 31 CFR Part 19

    Administrative practice and procedure, Contract programs, Grant 
programs.
George Munoz,
Assistant Secretary for Management.

    Title 31 of the Code of Federal Regulations, part 19 is amended as 
follows.

PART 19--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 19 continues to read as follows:

    Authority: E.O. 12549; secs. 5151-5160 of the Drug-Free 
Workplace Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 
U.S.C. 701 et seq.); 31 U.S.C. 321.

    2. Section 19.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 19.105 and 19.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 19.200, 19.215, 19.220, and 19.225 and Appendices A and 
B to Part 19 are revised as set forth at the end of the common 
preamble.

BILLING CODE: 4810-251-M
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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 25

RIN 0790-AF68
FOR FURTHER INFORMATION CONTACT: Mark Herbst, (703) 614-0205.

ADDITIONAL SUPPLEMENTARY INFORMATION: The Department of Defense adopts 
this amendment to the Governmentwide common rule on debarment and 
suspension for nonprocurement transactions. In adopting this rule, the 
Office of the Secretary of Defense, the Military Departments and the 
Defense Agencies will maintain uniform policies and procedures that are 
consistent with those of other Executive Departments and Agencies.
    The Department of Defense originally codified this Governmentwide 
rule on May 26, 1988 (53 FR 19190 and 19204), at 32 CFR Part 280. On 
February 21, [[Page 33053]] 1992 57 FR 6199), Part 280 was redesignated 
as Part 25. This rulemaking amends the redesignated part 25.

List of Subjects in 32 CFR Part 25

    Administrative practice and procedure, Contract programs, Grant 
programs.
Patricia L. Toppings,
Alternate OSD Federal Register Liaison Officer, Department of Defense.

    Title 32 of the Code of Federal Regulations, part 25 is amended as 
follows.

PART 25--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 25 is revised to read as follows:

    Authority: 41 U.S.C. 701 et seq.; sec. 2455, Pub. L. 103-355, 
108 Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549, 3 CFR, 1986 Comp.; 
189; E.O. 12689, 3 CFR, 1989 Comp., p. 235.

    2. Section 25.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 25.105 and 25.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 25.200, 25.215, 25.220, and 25.225 and Appendices A and 
B to Part 25 are amended as set forth at the end of the common 
preamble.
    5. Section 25.105 is amended further by adding paragraphs (1) and 
(2) to the definition for Agency, by adding paragraph (3) to the 
definition for Debarring official, and by adding paragraph (3) to the 
definition for Suspending official to read as follows:


Sec. 25.105  Definitions.

* * * * *
    Agency. * * *
    (1) The meaning of agency in Subpart F of this part, Drug-Free 
Workplace Requirements, is given at Sec. 25.605(b)(6) and is different 
than the meaning given in this section for subparts A through E of this 
part. Agency in Subpart F of this part means the Department of Defense 
or a Military Department only, and does not include any Defense Agency.
    (2) [Reserved]
* * * * *
    Debarring official. * * *
    (3) DoD Components' debarring officials for nonprocurement 
transactions are the same officials identified in 48 CFR part 209, 
subpart 209.4, as debarring officials for procurement contracts.
* * * * *
    Suspending official. * * *
    (3) DoD Components' suspending officials for nonprocurement 
transactions are the same officials identified in 48 CFR part 209, 
subpart 209.4, as suspending officials for procurement contracts.
* * * * *
    6. Section 25.610 is amended by adding paragraph (b)(1) to read as 
follows and by reserving paragraph (b)(2):


Sec. 25.610  Coverage.

* * * * *
    (b) * * *
    (1) Heads of Defense Agencies, Heads of DoD Field Activities, and 
their designees are authorized to make such determinations on behalf of 
the Secretary of Defense.
    (2) [Reserved]
* * * * *
    7. Section 25.616 is added to read as follows:


Sec. 25.616  Determinations of grantee violations.

    Heads of Defense Agencies, Heads of DoD Field Activities, and their 
designees are authorized to make determinations of grantee violations 
under Sec. 25.615.

BILLING CODE 5000.4-M
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DEPARTMENT OF EDUCATION

34 CFR Parts 85, 668, and 682

RIN 1880-AA51
FOR FURTHER INFORMATION CONTACT: Mary Jane Kane, U.S. Department of 
Education, 600 Independence Avenue, S.W., Room 3636 ROB-3, Washington, 
D.C. 20202-4700. Telephone: 708-7802. Individuals who use a 
telecommunications device for the deaf (TDD) may call the Federal 
Information Relay Service (FIRS) at 1-800-877-8339 between 8 a.m. and 8 
p.m., Eastern time, Monday through Friday.

ADDITIONAL SUPPLEMENTARY INFORMATION: In addition to the amendments 
made by all participating agencies for the common rule, the Secretary 
amends the Department's debarment and suspension procedures to reflect 
certain changes made by the Higher Education Amendments of 1992 to 
those provisions of title IV of the Higher Education Act of 1965, as 
amended (title IV, HEA) that govern administrative proceedings to limit 
or terminate the eligibility of participants in programs under that 
title. The Secretary also amends subpart G of part 668, which contains 
the Department's procedures for Fine, Limitation, Suspension, and 
Termination proceedings, to do the following: make technical amendments 
to reflect the 1992 amendments to the HEA as they affect actions under 
that part giving effect to debarments or suspensions; amend subpart G 
of Part 682 in order to apply the same procedures to debarments or 
suspensions of lenders or loan servicers under the Federal Family 
Education Loan Programs (FFELP); and prescribe the weight to be 
accorded a debarment or suspension by the hearing official in 
proceedings under both subparts when the termination or suspension is 
based on an action under Executive Order 12549 (3 CFR, 1986 Comp., p. 
189) or the Federal Acquisition Regulation (FAR), 48 CFR part 9, 
subpart 9.4.
    The preamble to the notice of proposed rulemaking (NPRM) provided 
information about the background for this rulemaking action, including 
a discussion regarding the need to make changes to the Department's 
amendments that were made to the Common Rule when it was issued in 
1988.
    Educational institutions participating in the Title IV, HEA 
programs must execute a program participation agreement that includes, 
as Schedule Z, a certification by the institution that neither it nor 
its principals are currently debarred or suspended, and that it will 
obtain a similar certification from those parties, such as third-party 
servicers, with which it contracts. Those parties must notify the 
institution if they are subsequently debarred or suspended; however, 
the Department has no written agreement with servicers, or with lenders 
under the Federal Family Education Loan Program, in which a 
certification like that made by the institution could be included. The 
Secretary is considering the desirability of including in Title IV, HEA 
regulations a requirement that a debarred or suspended lender or 
servicer promptly report that action to the Department, and will take 
up this issue at the time that the Interagency Committee considers 
further amendments to the nonprocurement Debarment and Suspension 
Common Rule (See the response to the comments of the Administrative 
Conference of the United States in the preamble to the Common Rule.).

Technical Amendments

    The Secretary makes certain technical amendments to the regulations 
in Part 85 that were not addressed in the preamble or set out in the 
text of the proposed amendments. These amendments are needed because 
the final common regulatory amendments [[Page 33054]] revise entire 
paragraphs rather than setting out only the text of those changes 
needed to achieve reciprocity (as was done in the NPRM). As a result, 
some of the Department's agency-specific amendments to the original 
debarment and suspension regulation needed to be restated to preserve 
their inclusion in the revised regulation. Other technical amendments 
are made to the final regulations to reflect the policies proposed in 
the NPRM, as discussed in the following analysis of the comments.

Analysis of Comments and Responses

Section 85.201 Treatment of Title IV, HEA Participation.

    Comment: Several commenters urged that Sec. 85.201 articulate the 
specific standards that the Secretary would use to determine whether 
the procedures used by another Federal agency to debar or suspend a 
lender, third-party servicer, or institution provided equivalent due 
process protections to those available under subpart G of Part 668 and 
Part 682.
    Discussion: The comment is well-taken. Prior to the amendments made 
to the HEA in 1992, proceedings under subpart G of Parts 668 or 682 to 
suspend or terminate the participation of lenders, servicers, and 
institutions were required to be conducted ``on the record'' in 
accordance with the requirements of 5 U.S.C. 554-557. These regulations 
have since been modified to remove the provisions referring to the 
proceedings as conducted ``on the record'' and to the presiding 
official as an ``administrative law judge,'' and may be further 
modified in the future.
    The Secretary intends to give effect to debarments or suspensions 
by other agencies that provide the same level of due process to 
affected entities, without requiring that those procedures mirror each 
feature of subpart G procedures as they now stand or may stand in the 
future. The subpart G regulations assure affected entities certain 
procedural protections before actions that had the effect of suspending 
or terminating their Title IV, HEA participation could become 
effective. Where those protections have been made available under 
procedures used by another agency, the affected entity has no claim to 
any additional procedural protections under Title IV, HEA regulations 
before these actions are given effect with regard to Title IV, HEA 
activities.
    This approach is consistent with the way courts treat the judgment 
of an administrative agency acting in an adjudicative capacity, 
regarding the adjudicative action as sufficient to bar the respondent 
from relitigating that matter in another proceeding either before the 
court or another agency. Courts do not require that the procedures used 
by the deciding agency mirror judicial procedures in order to bar 
relitigation of the matter, so long as the deciding agency follows 
typical adjudicative procedures. If adjudicative procedures are 
followed by the deciding agency, moreover, it is immaterial whether the 
entity subject to debarment or suspension under those procedures 
actually contested the action or made use of particular opportunities 
available under those procedures.
    Consistent with the approach taken by courts in deciding whether an 
agency's procedures suffice to bar relitigation of its decision 
elsewhere, the Secretary identifies those procedural steps sufficient 
to make other agency procedures comparable to subpart G procedures as 
including: (1) written notice specifying the grounds on which action is 
taken; (2) an opportunity to present evidence and legal argument in 
opposition to the action and have that opposition considered by an 
impartial trier of fact not responsible for the investigation or 
prosecution of the action; (3) an opportunity, where material facts are 
in dispute, for an oral evidentiary hearing at which the agency bears 
the burden of persuasion by a preponderance of the evidence, at which 
the respondent may, where the hearing official considers such testimony 
needed in light of other available evidence and witnesses, obtain the 
presence of agency witnesses with personal knowledge of material facts, 
and of which a transcribed record is available; and (4) a written 
decision based on the evidence and argument presented that states the 
facts and legal conclusions on which the decision is based.
    In determining whether the other agency's procedure comports with 
these standards, the Secretary will apply case precedent relevant to 
characterizing pertinent agency procedures in other, similar contexts. 
For example, as noted in Withrow v. Larkin, 421 U.S. 57, 56 (1975), an 
administrative official does not become an investigator or prosecutor 
simply by the act of determining that a notice of proposed debarment is 
supported by sufficient allegations and evidence to warrant issuance; 
that function resembles the traditional judicial function of 
considering and ruling on motions to dismiss.
    Changes: The final rule articulates in Sec. 85.201 the elements 
described here as those that the Secretary will consider sufficient to 
provide the same level of procedural due process to make another 
Federal agency exclusionary action binding with respect to Title IV, 
HEA participation. Conforming changes are made in Secs. 668.82, 
682.705, and 682.706. The regulations do not require that these 
elements be articulated in the other agency's published regulations, 
and the Secretary intends to consider whether a particular element, 
although not stated in agency regulations, is, in practice, part of the 
agency internal process used to decide the case in question. The 
regulations are further amended to state that the Secretary will notify 
an affected entity whether the debarment or suspension is regarded by 
the Department as binding with respect to Title IV, HEA participation, 
and specify the effective date of the action.
    The rule provides no opportunity for an administrative appeal of 
that determination, and the Secretary therefore considers that 
determination to be the final action of the Department.

Section 668.90 Initial and Final Decisions.

    Comment: Several commenters objected to the proposal in the NPRM to 
treat a proposed debarment under the FAR, when imposed under procedures 
considered equivalent to those in subpart G of Parts 668 and 682, as 
sufficient action to suspend the participation in Title IV, HEA 
programs of a lender, servicer, or institution.
    Discussion: Both a proposed debarment under the FAR and a 
suspension under E.O. 12549 have the effect of suspending the entity as 
of the date on which the department or agency initiated the action by 
sending notice of the action to the respondent. This immediate effect 
differs from either termination or suspension actions under subpart G 
of Parts 668 or 682; the latter both assure the entity an opportunity 
to dispute the action prior to its taking effect, unless an emergency 
action is simultaneously taken against the entity. However, this 
difference does not necessarily prevent these debarment or suspension 
procedures from being considered equivalent to subpart G procedures.
    If the agency's procedures otherwise provide the procedural due 
process protections described in Sec. 85.201, this lack of an 
opportunity to object prior to the suspension taking effect becomes 
moot in two instances. First, if the respondent does not object to the 
action in a timely manner in accordance with the agency procedures, the 
suspension continues in effect by what can either be characterized as a 
default judgment or implicit consent by the respondent. Second, if the 
respondent timely objects [[Page 33055]] and the debarring or 
suspending agency issues a decision rejecting that objection, the 
suspension thereafter continues in effect by virtue of that decision 
and not by virtue of the mere initiation of the action.
    Changes: The final rule provides, in Secs. 85.201(a), 668.82(f)(2), 
and 682.705 that if another agency, using procedures comparable to 
those under subpart G of Parts 668 or 682, has proposed debarment under 
the Federal Acquisition Regulation (FAR) or suspended an entity, the 
Secretary gives effect to that action as suspending the Title IV, HEA 
participation of a lender, servicer, or institution only after he 
determines either that the entity has not timely objected to the 
action, or has objected and received a decision from the agency 
upholding the action.
    In addition, the final regulation has been revised to give finality 
only to those agency decisions that meet subpart G standards. Sections 
668.90, 682.705 and 682.706 have been revised to provide that a 
debarment or suspension by another agency under procedures that the 
Secretary determines do not meet these standards does not bar the 
affected entity from contesting the grounds and justification for the 
suspension or debarment under subpart G procedures. However, the other 
agency's decision is at very least strong evidence that debarment or 
suspension is warranted, and the final regulations now provide that the 
decision constitutes a prima facie case that the comparable action is 
warranted under Department procedures.
    Therefore, although the designated Department official continues to 
bear the burden of persuasion in actions to debar, terminate, or 
suspend a lender, servicer, or institution, the fact of suspension or 
debarment by another agency shifts to the respondent the burden of 
producing some credible evidence that the action is not warranted with 
respect to the Title IV, HEA programs. The designated Department 
official may then introduce rebuttal evidence to sustain his or her 
burden of proof; that evidence may include the evidence on which the 
other Federal agency relied in imposing the debarment or suspension.

Sections 668.90, 682.705, 682.706 Effective Date and Duration of 
Suspension or Termination Based on Suspension or Debarment

    Comment: Several commenters urged that the regulations clarify the 
period for which the suspension or termination taken on the basis of a 
debarment, suspension or proposed debarment would be effective.
    Discussion: Subpart G of Part 668, as amended April 29, 1994, 59 FR 
22444, provides in Sec. 668.82(f)(2) that a suspension by another 
agency under procedures comparable to those in subpart G suspends the 
participation of an institution or third-party servicer for 60 days 
from the date of that agency's action, unless the Secretary commences a 
limitation or termination action under subpart G within that period. In 
other instances, the commencement and duration of a suspension imposed 
by the Secretary is stated in Sec. 668.85(b), which provides that the 
suspension commences 20 days after notice of the proposed suspension is 
mailed, unless the respondent timely objects and requests a hearing, 
and expires 60 days after it takes effect unless the Secretary 
commences a limitation or termination action within that period.
    The duration of a termination on the basis of a debarment is 
similarly addressed in current Secs. 668.82(f)(1) and 668.96(b)(2), 
which provide that a debarment under procedures comparable to subpart G 
procedures is effective as a termination for at least the duration of 
the debarment or 18 months, whichever is greater, after which the 
institution or servicer may request reinstatement.
    The commencement and duration of suspensions and terminations with 
respect to lenders and loan servicers are similarly stated in current 
regulations. 34 CFR Secs. 682.705, 682.706, and 682.711. These 
regulations do not specifically address the commencement and duration 
of a suspension or termination action taken based on actions pursuant 
to Executive Order 12549 or the FAR. Generally, current regulations 
provide and the proposed rule provided that a suspension or termination 
based on a suspension or debarment by another agency under procedures 
comparable to those provided under the respective subparts G of 34 CFR 
Parts 668 and 682 is effective, with respect to Title IV, HEA program 
transactions, on the date on which the other agency's action is 
effective. Under the proposed rule, the Secretary would notify the 
affected party whether that action had been taken under subpart G--type 
procedures. If the debarment or suspension had been taken under such 
procedures, the action would have been effective with respect to Title 
IV, HEA program transactions already taken by the party; if it had not, 
the Secretary would then bring an action under subpart G to suspend or 
terminate the party's participation; unless emergency action were 
taken, Title IV, HEA program transactions by that party would not be 
effected until the subpart G proceeding was complete. Under the 
proposed rule, then, the debarred or suspended party would not know 
whether it could properly initiate new Title IV, HEA program 
transactions--awarding and disbursing grant, loan, or work study funds, 
or certifying new loan applications--after the date of the other agency 
action until it received notice of the Secretary's determination.
    The Secretary has decided to change this outcome so that a 
debarment or suspension entered by another agency under procedures that 
meet the standards in Sec. 85.201 will not be effective against an 
institution or other affected entity until 20 days after the Department 
mails notice of its determination that the other agency's action would 
be recognized under Title IV, HEA.
    Changes: Section 85.201 is amended in the final rule to provide 
that where the Secretary gives effect to a suspension or debarment 
pursuant to the action of another agency, the notice of that 
determination will state the effective date and duration of those 
actions. The effective date in such instances will be 20 days after the 
date the notice is mailed. No revision is needed to address the 
commencement and duration of other actions initiated by the Secretary 
consistent with subpart G of Part 668. Changes are made in 34 CFR 
Secs. 682.705 and 682.711 to conform the periods of exclusion from 
FFELP participation to those under Part 668. In addition, the final 
rule revises Secs. 85.201 and 85.220 to clarify the effect of debarment 
on Title IV, HEA participation by stating that the particular 
transactions from which a debarred or suspended entity is excluded 
under Title IV, HEA are the loans, grants, or work study assistance 
disbursed, awarded, acquired or serviced by that entity. Thus, only 
those transactions listed in revised Sec. 85.201 are fully subject to 
debarment and termination. The revised Sec. 85.220 also addresses the 
effect of the debarment and termination on continuing transactions by 
referring to current provisions of 34 CFR 668.26, 682.702, and 668.94, 
which describe the kinds of actions that an affected party may take 
after the effective date of its termination.

List of Subjects in 34 CFR Part 85

    Administrative practice and procedure, Contract programs, Grant 
programs, Grant administration Grant programs--education.

List of Subjects in 34 CFR Part 668

    Administrative practice and procedure, Colleges and universities, 
[[Page 33056]] Consumer protection, Grant programs--education, Loan 
programs--education, Student aid.

List of Subjects in 34 CFR Part 682

    Administrative practice and procedure, Colleges and universities, 
Education, Loan programs-education, Reporting and recordkeeping 
requirements, Student aid, Vocational education.
Richard W. Riley,
Secretary of Education.
    Title 34 of the Code of Federal Regulations, Parts 85, 668, and 682 
are amended as follows.

PART 85--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 85 is revised to read as follows:

    Authority: 20 U.S.C. 1221e-3 and 3474; 41 U.S.C. 701 et. seq.; 
sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327; E.O. 12549, 3 
CFR, 198.6 Comp., p. 189; E.O. 12689, 3 CFR, 1989 Comp., p. 235.

    2. Section 85.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 85.105 and 85.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 85.200, 85.215, 85.220, and 85.225 and Appendices A and 
B to Part 85 are revised as set forth at the end of the common 
preamble.
    5. Section 85.100 is further amended by revising paragraph (a) and 
the authority citation to read as follows:


Sec. 85.100  Purpose.

    (a) Executive Order (E.O.) 12549 provides that, to the extent 
permitted by law, Executive departments and agencies shall participate 
in a governmentwide system for nonprocurement debarment and suspension. 
A person who is debarred or suspended shall be excluded from Federal 
financial and nonfinancial assistance and benefits under Federal 
programs and activities. Except as provided in Sec. 85.200, Debarment 
or Suspension, Sec. 85.201, Treatment of Title IV HEA participation, 
and Sec. 85.215, Exception provision, debarment or suspension of a 
participant in a program by one agency shall have governmentwide 
effect.
* * * * *
(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

    6. Section 85.200 is further amended by revising paragraphs (a) and 
(b) and the authority citation to read as follows:


Sec. 85.200  Debarment or suspension.

    (a) Primary covered transactions. Except to the extent prohibited 
by law and subject to Sec. 85.201, Treatment of Title IV HEA 
participation, persons who are debarred or suspended shall be excluded 
from primary covered transactions as either participants or principals 
throughout the executive branch of the Federal Government for the 
period of their debarment, suspension or the period they are proposed 
for debarment under 48 CFR part 9, subpart 9.4. Accordingly, ED shall 
not enter into primary covered transactions with such excluded persons 
during such period, except as permitted pursuant to Sec. 85.215.
    (b) Lower tier covered transactions. Except to the extent 
prohibited by law and subject to Sec. 85.201, Treatment of Title IV HEA 
participation, persons who have been proposed for debarment under 48 
CFR part 9, subpart 9.4, debarred or suspended shall be excluded from 
participating as either participants or principals in all lower tier 
covered transactions (see Sec. 85.110(a)(1)(ii)) for the period of 
their exclusion. Such persons shall also be excluded from all contracts 
to provide federally-required audit services, regardless of contract 
amount.
* * * * *
(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

    7. Section 85.201 is revised to read as follows:


Sec. 85.201  Treatment of Title IV, HEA participation.

    (a)(1) The debarment of an educational institution, lender, or 
third party servicer under E.O. 12549 by an agency other than the 
Department pursuant to procedures described in paragraph (c) of this 
section terminates the eligibility of the entity to enter into 
transactions under any student financial assistance program authorized 
by Title IV of the Higher Education Act of 1965, as amended, for the 
duration of the debarment.
    (2)(i) The suspension of an educational institution, lender, or 
servicer under E.O. 12549 or pursuant to a proposed debarment under the 
Federal Acquisition Regulation (FAR), 48 CFR part 9, subpart 9.4, by an 
agency other than the Department under procedures described in 
paragraph (c) of this section suspends the eligibility of the entity to 
enter into transactions under any student financial assistance program 
authorized by Title IV of the Higher Education Act of 1965, as amended.
    (ii) The suspension of Title IV eligibility as a result of a 
suspension described in paragraph (a)(2) of this section lasts for a 
period of 60 days, beginning on the later of the date of the decision 
of the suspending official of the other agency in response to an 
objection to the suspension or, if no objection to that suspension was 
raised, on the 35th day after the notice of suspension was issued by 
that agency. The suspension described here does not expire on the 60th 
day if the suspended entity and the Secretary agree to an extension or 
if the Secretary initiates a limitation or termination proceeding 
against the entity under 34 CFR Part 668, subpart G, or Part 682, 
subpart G, as applicable, prior to the 60th day.
    (3) A transaction under a Title IV, HEA program includes--
    (i) The disbursement or delivery of funds provided under a Title 
IV, HEA program to a student or borrower;
    (ii) The certification by an educational institution of eligibility 
for a loan under at Title IV, HEA program;
    (iii) The acquisition of a loan made under a Title IV, HEA program; 
and
    (iv) The acquisition of any servicing responsibility for a grant, 
loan, or work study assistance under a Title IV, HEA program.
    (b)(1) The Secretary notifies the institution, lender, or servicer 
that has been debarred or suspended by another Federal agency whether 
the debarment or suspension takes effect in accordance with paragraph 
(a) of this section and states the effective date and duration of that 
action.
    (2)(i) If the Secretary proposes to give effect to a suspension or 
debarment against an educational institution, lender, or third-party 
servicer that does not meet the standards in paragraph (c) of this 
section, the Secretary initiates a debarment or suspension proceeding 
under Sec. 85.316 or Sec. 85.414, respectively, against that entity.
    (ii) The effective date of a debarment or suspension that takes 
effect under paragraph (a) of this section shall be 20 days after the 
date the notice is mailed. The Secretary gives effect to a suspension 
described in paragraph (a)(2) of this section only after the suspending 
official of the other agency has issued a decision in response to an 
objection to the suspension or, if no objection to that suspension was 
raised, on the 35th day after the notice of suspension was issued by 
that agency. The suspension lasts for a period of 60 days, beginning on 
the effective date specified in the notice, unless the suspended entity 
and [[Page 33057]] the Secretary agree to an extension or the Secretary 
initiates a limitation or termination proceeding against the entity 
under 34 CFR Part 668, subpart G, or Part 682, subpart G, as 
applicable, prior to the 60th day.
    (3) If an institution, lender, or a third party servicer is 
suspended by ED or another Federal agency, the Secretary determines 
whether grounds exist for the initiation of an emergency action against 
the entity under 34 CFR Part 668, subpart G, or Part 682, subpart G, as 
applicable.
    (c) An institution, lender, or third-party servicer that is 
debarred or suspended by another agency, or proposed for debarment 
under 48 CFR part 9, subpart 9.4 by another Federal agency, is 
debarred, terminated or suspended, as provided under this part, 34 CFR 
part 668, and 34 CFR part 682, as applicable, if that agency took this 
action under procedures that afforded the excluded party the following:
    (1) Notice of the proposed action;
    (2) An opportunity to submit and have considered evidence and 
argument in opposition to the proposed action;
    (3) An opportunity to obtain a hearing on its objection--
    (i) At which the agency bears the burden of persuasion, by a 
preponderance of the evidence;
    (ii) Conducted by an impartial person who does not also exercise 
prosecutorial or investigative responsibilities with respect to that 
action;
    (iii) At which the entity may, unless the hearing official 
determines that no genuine dispute of material fact exists, present 
testimony and secure the attendance of those agency witnesses with 
personal knowledge of material facts whose testimony the hearing 
official determines to be needed, in light of other available evidence 
and witnesses; and
    (iv) Of which a transcribed record is available upon request; and
    (4) A written decision stating findings of fact and conclusions of 
law on which the decision is rendered.
    (d) The Title IV, HEA programs are those programs listed in 34 CFR 
668.1(c).

(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

    8. Section 85.220 is revised to read as follows:


Sec. 85.220  Continuation of covered transactions.

    (a) Notwithstanding the debarment, suspension, proposed debarment 
under 48 CFR part 9, subpart 9.4, determination of ineligibility, or 
voluntary exclusion of any person by an agency and except as provided 
in Sec. 85.201, agencies and participants may continue covered 
transactions in existence at the time the person was debarred, 
suspended, proposed for debarment under 48 CFR part 9, subpart 9.4, 
declared ineligible, or voluntarily excluded. A decision as to the type 
of termination action, if any, to be taken should be made only after 
thorough review to ensure the propriety of the proposed action.
    (b) Agencies and participants shall not renew or extend covered 
transactions (other than no-cost time extensions) with any person who 
is debarred, suspended, proposed for debarment under 48 CFR part 9, 
subpart 9.4, ineligible or voluntary excluded, except as provided in 
Sec. 85.215.
    (c) An educational institution, lender, or servicer may continue a 
Title IV, HEA transaction after the effective date of a debarment as 
determined under Sec. 85.201 only as provided in 34 CFR 668.26, 
682.702, or 668.94, as applicable.

(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

    9. Section 85.314 is amended by revising paragraph (d) and the 
authority citation to read as follows:
Sec. 85.314  Debarring official's decision.

* * * * *
    (d) Notice of debarring official's decision.
    (1) If the debarring official decides to impose debarment, the 
respondent shall be given prompt notice--
    (i) Referring to the notice of proposed debarment;
    (ii) Specifying the reasons for debarment;
    (iii) Stating the period of debarment, including effective dates; 
and
    (iv) Advising that the debarment is effective for covered 
transactions throughout the executive branch of the Federal Government 
unless an agency head or authorized designee makes the determination 
referred to in Sec. 85.215.
    (2) If the debarring official decides not to impose debarment, the 
respondent shall be given prompt notice of that decision. A decision 
not to impose debarment shall be without prejudice to a subsequent 
imposition of debarment by any other agency.

(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

    10. Section 85.316 is revised to read as follows:


Sec. 85.316  Procedures for Title IV, HEA debarments.

    (a) If the Secretary initiates a debarment action against an 
educational institution, lender or third-party servicer under E.O. 
12549, the Secretary uses the following procedures in connection with 
the debarment to ensure that the debarment also precludes participation 
under Title IV of the Higher Education Act of 1965, as amended:
    (1) The procedures in Sec. 85.312, Notice of proposed debarment, 
and Sec. 85.314(d), Notice of debarring official's decision.
    (2) Instead of the procedures in Sec. 85.313 and Sec. 85.314(a)-
(c), the procedures in 34 CFR part 668, subpart G, or 34 CFR part 682, 
subpart G, as applicable.
    (b) On appeal from a decision debarring an educational institution, 
lender, or third-party servicer, the Secretary issues a final decision 
after all parties have filed their written materials with the 
Secretary.
    (c) In a proceeding under this section, in addition to the findings 
and conclusions required by 34 CFR part 668, subpart G, or 682, subpart 
G, the debarring official, and, on appeal, the Secretary, determine 
whether there exist sufficient grounds for debarment as set forth in 
Sec. 85.305.

(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)
    11. Section 85.414 is revised to read as follows:


Sec. 85.414  Procedures for Title IV, HEA suspensions under E.O. 12549.

    (a) Title IV E.O. 12549 suspensions. (1) If the Secretary initiates 
a suspension against an educational institution, lender or third-party 
servicer under E.O. 12549, the Secretary uses the following procedures 
in connection with the suspension to ensure that the suspension 
precludes participation under Title IV of the Higher Education Act of 
1965, as amended:
    (i) The procedures in Sec. 85.411, Notice of suspension.
    (ii) Instead of the procedures in Secs. 85.412, 85.413 and 85.415, 
the procedures in 34 CFR part 668, subpart G, or 34 CFR part 682, 
subpart G, as applicable.
    (2) In a proceeding under this section, in addition to the findings 
and conclusions required by 34 CFR part 668, subpart G, or 34 CFR part 
682, subpart G, the suspending official, and, on appeal, the Secretary, 
determine whether there exist sufficient grounds for suspension as set 
forth in Sec. 85.405.
    (b) Continued assistance under Title IV, HEA. The institution, 
lender, or [[Page 33058]] third-party servicer may continue its 
participation in the Title IV programs until the procedures described 
in paragraph (a) of this section, except for those relating to appeals 
to the Secretary, have been completed, unless the Secretary takes an 
emergency action under 34 CFR part 668, subpart G, or 34 CFR part 682, 
subpart G.

(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1082, 1094, 1221e-3 and 
3474; and Sec. 2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

    12. Insert ``ED'' where [agency] appears in Sec. 85.215.
    13. The authority citation for sections 85.105, 85.110, 85.115, 
85.205, 85.210, 85.215, 85.225, 85.300, 85.305, 85.310, 85.311, 85.312, 
85.313, 85.315, 85.320, 85.325, 85.400, 85.405, 85.410, 85.411, 85.412, 
85.413, 85.415, 85.420, 85.500, 85.505, and 85.510, is revised to read 
as follows:

(Authority: E.Os. 12549 and 12689; 20 U.S.C. 1221e-3 and 3474; Sec. 
2455, Pub. L. 103-355, 108 Stat. 3243 at 3327)

PART 668--STUDENT ASSISTANCE GENERAL PROVISIONS

    1. The authority for part 668 continues to read as follows:

    Authority: 20 U.S.C. 1085, 1088, 1091, 1092, 1094, 1099c, and 
1141, unless otherwise noted.

    2. Section 668.82 is amended by removing from paragraph (f)(1) 
introductory text the words ``that comply with 5 U.S.C. 554-557 (formal 
adjudication requirements under the Administrative Procedure Act),'' 
and adding, in their place, ``described in 34 CFR 85.201(c)'' by 
removing the words ``by the Secretary'' in paragraphs (f)(1) 
introductory text and (f)(2)(i) introductory text, by removing from 
paragraph (f)(2)(i) introductory text ``that comply with 5 U.S.C. 554-
557'' and adding, in their place, ``described in 34 CFR 
Sec. 85.201(c)'' and by revising paragraph (f)(2)(ii) introductory text 
and adding a new paragraph (f)(3), to read as follows:


Sec. 668.82  Standard of conduct.

* * * * *
    (f) * * *
    (2) * * *
    (ii) A suspension described in paragraph (f)(2) of this section 
lasts for a period of 60 days, beginning on the effective date 
specified in the notice by the Secretary under 34 CFR 85.201(b), 
unless--
* * * * *
    (3) A debarment or suspension not described in (f)(1) or (f)(2) of 
this section of a participating institution or third-party servicer by 
another Federal agency constitutes prima facie evidence in a proceeding 
under this subpart that cause for suspension or debarment and 
termination, as applicable, exists.

PART 682--FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAMS

    1. The authority citation for part 682 continues to read as 
follows:

    Authority: 20 U.S.C. 1071 to 1087-2, unless otherwise noted.

    2. Section 682.705 is amended by redesignating paragraphs (c)(6), 
(c)(7), and (c)(8) as paragraphs (c)(7), (c)(8), and (c)(9), 
respectively, and adding new paragraphs (a)(3) and (c)(6), to read as 
follows:


Sec. 682.705  Suspension proceedings.

    (a) * * *
    (3) A suspension described in 34 CFR 85.201(c) lasts for a period 
of 60 days, beginning on the effective date specified in the notice by 
the Secretary under 34 CFR 85.201(b), except as provided in paragraph 
(a)(1)(i) or (ii) of this section.
* * * * *
    (c) * * *
    (6) In a suspension action against a lender or third-party servicer 
based on a suspension under Executive Order 12549 or a proposed 
debarment under the Federal Acquisition Regulation (FAR), 48 CFR part 
9, subpart 9.4, that does not meet the standards described in 34 CFR 
85.201(c), the presiding official finds that the suspension or proposed 
debarment constitutes prima facie evidence that cause for suspension 
under this subpart exists.
* * * * *
    3. Section 682.706 is amended by redesignating paragraphs (b)(7), 
(b)(8), and (b)(9) as paragraphs (b)(8), (b)(9), and (b)(10), 
respectively, and adding a new paragraph (b)(7), to read as follows:


Sec. 682.706  Limitation or termination proceedings.

* * * * *
    (b) * * *
    (7) In a termination action against a lender or third-party 
servicer based on a debarment under Executive Order 12549 or under the 
Federal Acquisition Regulation (FAR), 48 CFR part 9, subpart 9.4 that 
does not meet the standards described in 34 CFR 85.201(c), the 
presiding official finds that the debarment constitutes prima facie 
evidence that cause for debarment and termination under this subpart 
exists.
* * * * *
    4. Section 682.711 is amended by revising paragraph (a) to read as 
follows:


Sec. 682.711  Reinstatement after termination.

    (a) A lender or third-party servicer whose eligibility has been 
terminated by the Secretary in accordance with the procedures of this 
subpart may request reinstatement of its eligibility after the later 
of--
    (1) Eighteen months from the effective date of the termination; or
    (2) The expiration of the period of debarment under Executive Order 
12459 or the Federal Acquisition Regulation (FAR), 48 CFR part 9, 
subpart 9.4.
* * * * *
BILLING CODE: 4000-01-P
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NATIONAL ARCHIVES AND RECORDS ADMINISTRATION

36 CFR Part 1209

RIN 3095-AA38
FOR FURTHER INFORMATION CONTACT: Mary Ann Hadyka, Policy and 
Information Resources Management, 301-713-6730.

List of Subjects in 36 CFR Part 1209

    Administrative practice and procedure, Contract programs, Grant 
programs--archives and records.
Trudy Huskamp Peterson,
Acting Archivist of the United States.

    Title 36 of the Code of Federal Regulations, part 1209 is amended 
as follows.

PART 1209--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1209 continues to read as follows:

    Authority: E.O. 12549; sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 101-690, title V, subtitle D; 41 U.S.C. 701 et 
seq.); 44 U.S.C. 2104(a).

    2. Section 1209.100 is revised as set forth at the end of the 
common preamble.
    3. Section 1209.105 and 1209.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1209.200, 1209.215, 1209.220, and 1209.225 and 
Appendices A and B to Part 1209 are revised as set forth at the end of 
the common preamble.
BILLING CODE: 7515-01
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[[Page 33059]]

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 44

FOR FURTHER INFORMATION CONTACT: Ms. Judith A. Caden, Assistant 
Director for Loan Policy (264), Loan Guaranty Service, Veterans 
Benefits Administration, Department of Veterans Affairs, Washington, DC 
20420, (202) 273-7368.

List of Subjects in 38 CFR Part 44

    Administrative practice and procedure, Contract programs, Grant 
programs, Housing, Loan Programs-housing and community development, 
Reporting and recordkeeping requirements, Veterans.
Jesse Brown,
Secretary of Veterans Affairs.

    Title 38 of the Code of Federal Regulations, part 44 is amended as 
follows.

PART 44--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 44 continues to read as follows:

    Authority: 38 U.S.C. 501(a) and 3703(c); E.O. 12549; E.O. 12689.

    2. Section 44.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 44.105 and 44.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 44.200, 44.215, 44.220, and 44.225 and Appendices A and 
B to Part 44 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 8320-01-M
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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 32

RIN 2030-AA39
FOR FURTHER INFORMATION CONTACT: Robert F. Meunier, Director, 
Suspension and Debarment Division (3902F), 401 M Street, S.W., 
Washington, D.C. 20460, telephone: (202) 260-8025.

ADDITIONAL SUPPLEMENTARY INFORMATION: Inquiries may also be submitted 
via electronic mail (e-mail) to: [email protected]. 
Electronic inquiries must be submitted as an ASCII file avoiding the 
use of special characters and any form of encryption. Inquiries will 
also be accepted on disks in WordPerfect in 5.1 file format or ASCII 
file format. No Confidential Business Information (CBI) should be 
submitted through e-mail.

List of Subjects in 40 CFR Part 32

    Administrative practice and procedure, Contract programs, Debarment 
and suspension, Grant programs.

    Dated: May 26, 1995.
Carol M. Browner,
Administrator.

    Title 40 of the Code of Federal Regulations, Part 32 is amended as 
follows:

PART 32--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for Part 32 is revised to read as follows:

    Authority: 7 U.S.C. 136 et seq.; 15 U.S.C. 2601 et seq.; 20 
U.S.C. 4011 et seq.; 33 U.S.C. 1251 et seq.; 41 U.S.C. 701 et seq.; 
42 U.S.C. 300f, 4901, 6901, 7401, 9801; sec. 2455, Pub. L. 103-355, 
108 Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549, 3 CFR, 1986 Comp.; 
189; E.O. 12689, 3 CFR, 1989 Comp., p. 235.

    2. Section 32.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 32.105 and 32.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 32.200, 32.215, 32.220, and 32.225 and Appendices A and 
B to Part 32 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 6560-50-M
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GENERAL SERVICES ADMINISTRATION

41 CFR Part 105-68

RIN 3090-AF65
FOR FURTHER INFORMATION CONTACT: Donald Suda, (202) 501-1224.

List of Subjects in 41 CFR Part 105-68

    Administrative practice and procedure, Contract programs, Grant 
programs.

Roger W. Johnson,
Administrator.
    Title 41 of the Code of Federal Regulations, Part 105-68 is amended 
as follows.

PART 105-68--GOVERNMENTWIDE DEBARMENT AND SUSPENSION 
(NONPROCUREMENT) AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE 
WORKPLACE (GRANTS)

    1. The authority for part 105-68 continues to read as follows:

    Authority: E.O. 12549; sec. 5151-5160 of the Drug-Free Workplace 
Act of 1988 (Pub. L. 100-690, Title V, Subtitle D; 41 U.S.C. 701 et 
seq.); 40 U.S.C. 486(c).

    2. Section 105-68.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 105-68.105 and 105-68.110 are amended as set forth at 
the end of the common preamble.
    4. Sections 105-68.200, 105-68.215, 105-68.220, and 105-68.225 and 
Appendices A and B to Part 105-68 are revised as set forth at the end 
of the common preamble.
BILLING CODE: 6820-61-M
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DEPARTMENT OF THE INTERIOR

Office of the Secretary

43 CFR Part 12

RIN 1090-AA49
FOR FURTHER INFORMATION CONTACT: Dean A. Titcomb, (Chief, Acquisition 
and Assistance Division), (202) 208-6431.

ADDITIONAL SUPPLEMENTARY INFORMATION: The Department published an 
agency-specific preamble as part of the final nonprocurement debarment 
and suspension common rule on May 26, 1988 (53 FR 19159), which 
indicated that, due to the expanded scope of transactions covered under 
the rule, coverage of its nonprocurement debarment and suspension 
system was limited to transactions included in section 12.110(a)(1) of 
its proposed rule (52 FR 39042).
    The Department also indicated that a review of the Department's 
other nonprocurement program activities would be made to determine 
whether such activities would be included in the coverage. The review 
was made; however, plans to issue a notice of proposed rulemaking to 
obtain public comment on covered transactions on or before October 1, 
1988, were dropped.
    Issues of concern to the Department were addressed through the 
subcommittee of the Interagency Committee on Debarment and Suspension 
(Interagency Group) which reviewed the scope of the nonprocurement 
debarment system. Although the revision of the proposed 
[[Page 33060]] common rule did not address the issue of scope, the 
Department proposed to include the results of the resolution of this 
issue as part of the December 20, 1994, publication as discussed below.
    New exceptions for certain types of transactions under natural 
resource management programs were proposed. These exceptions attempted 
to make clear that permits, licenses, exchanges and other acquisitions 
of real property, rights-of-way, and easements, under natural resource 
management programs were excluded from coverage.
    For example, when the Federal Government seeks to acquire real 
property, including through use of an exchange of real property 
elsewhere, the transaction will not be subject to these regulations. In 
such cases, where the success of the agency program depends on a 
specific parcel of land, the application of the debarment and 
suspension system could harm the public interest. Moreover, public land 
management activities require the use of certain transactions for land 
and resource management without regard to the identity of the 
recipient. Accordingly, range management transactions, such as grazing 
permits and rights-of-way, are excluded by the proposed exception 
language. Similarly, virtually all recreation management and public 
land access transactions are not covered.
    In addition, the Department proposed to amend section 12.110(a)(3) 
of its final rule to include nonprocurement debarment system coverage 
for Federal acquisition of a leasehold interest or any other interest 
in real property, concession contracts, and disposition of Federal real 
and personal property and natural resources.
    The scope of the Department's nonprocurement debarment system will 
include transactions associated with natural resources management 
programs and the disposition of natural resources with the following 
exceptions: permits, licenses, exchanges and other acquisitions of real 
property, rights-of-way, easements, mineral patent claims administered 
by the Bureau of Land Management and water service contracts and 
repayment contracts awarded by the Bureau of Reclamation. Patents 
issued under the Mining Law of 1872, 30 U.S.C. 22 et seq., as amended 
are statutory entitlements and, therefore, are exempt under the terms 
of Executive Order 12549. The award of water service contracts and 
repayment contracts is mandatory, provided by the Reclamation Project 
Act of 1939, as amended, set forth at 43 U.S.C. 485.
    One comment was received from the private sector, and one comment 
was received from another Federal agency in response to the proposed 
rule. The private sector commenter stated that the Department's 
proposal to include nonprocurement debarment system coverage for 
disposition of Federal real and personal property and natural resources 
was unwarranted and that the preamble provided no articulated basis for 
the proposal. The commenter also stated that the Department was under 
no statutory compulsion to make this change. The commenter stated that 
there is no policy basis for including asset sales in the 
nonprocurement debarment system, particularly given the expanded scope 
of the system to include reciprocal procurement and nonprocurement 
government-wide effect. The commenter expressed the view that including 
asset sales in the nonprocurement debarment system works a punishment 
on potential buyers who would be deemed ineligible, contrary to the 
express purposes of the nonprocurement system.
    The amendment of section 12.110(a)(3) as to covered transactions 
does not add disposition of real and personal property and natural 
resources. It is our interpretation that these transactions were 
already covered as part of the general language adopted in the final 
common rule published on May 26, 1988. Because of new exceptions from 
coverage, as set forth in section 12.110(a)(2), however, the language 
in section 12.110(a)(3) was added to attempt to clarify those covered 
transactions previously excluded.
    The U.S. Forest Service (USFS) addressed the compatibility of this 
rule with the debarment provisions of the Forest Resources Conservation 
and Shortage Relief Act of 1990 (Export Act). USFS states that in 
enacting the Export Act, Congress ``anticipated no governmentwide 
effect would be imposed on persons debarred pursuant to the Export 
Act.'' USFS relies for this proposition solely on the provision of the 
Export Act that debarment thereunder may be decided only by the 
Secretaries of Commerce and of the Interior. We reject this 
interpretation. By participating in this common rule making, agencies 
are agreeing only to give reciprocal effect to debarments and 
suspensions effectuated by other agencies. This is not the same as the 
other agencies debarring or suspending a party under the Export Act. 
Similarly, the Export Act gives both Commerce and Interior discretion 
to deny applications for unprocessed timber that are filed under the 
Export Act. Accordingly, we see no prohibition in that Act against 
giving reciprocal effect to governmentwide debarments or suspensions to 
applications under the Export Act.
    USFS also stated a concern that due to differing requirements of 
this rule and the Export Act, separate debarment systems will have to 
be maintained, and that all timber-related debarments should be ``under 
one system.'' We do not understand what USFS intends when it refers to 
separate debarment systems. As long as the source of the debarment is 
apparent, we see no reason why the differing effects of debarments 
under the Export Act and this rule would require the maintenance of two 
separate systems.
    Next, USFS queries whether sale of miscellaneous forest products, 
such as Christmas trees, posts and poles, and boughs, will be covered. 
We would exclude such sales as incidental benefits.
    Finally, USFS recommends that there should only be a self-
certification process for individuals and families, not also a check by 
Federal agencies of the List of Parties Excluded from Federal 
Procurement and Nonprocurement Programs for the individual or 
corporation and all its aliases or affiliates. We believe that Federal 
agencies have an obligation to ensure that the Federal Government is 
only doing business with responsible parties; therefore, we are not 
changing the Common Rule's requirement for Federal agencies to check 
the List.
    Therefore, the Department will exclude all transactions concerning 
permits, licenses, exchanges and other acquisitions of real property, 
rights-of-way, easements, mineral patent claims, water service 
contracts, and repayment contracts from its nonprocurement debarment 
and suspension system.
    A corresponding change is also being made in Section 12.200(c) to 
add a reference to these excluded transactions.

List of Subjects in 43 CFR Part 12

    Administrative practice and procedure, Contract programs, 
Cooperative agreements, Grant programs, Grants administration, 
Reporting and recordkeeping requirements.

    Dated: May 25, 1995.
Bonnie R. Cohen,
Assistant Secretary--Policy, Management and Budget.

    Title 43 of the Code of Federal Regulations, part 12 is amended as 
follows: [[Page 33061]] 

PART 12--ADMINISTRATIVE AND AUDIT REQUIREMENTS AND COST PRINCIPLES 
FOR ASSISTANCE PROGRAMS

    1. The authority for part 12 is revised to read as follows:

    Authority: 5 U.S.C. 301; 31 U.S.C. 6101 note, 7501; 41 U.S.C. 
252a, 701 et seq.; sec. 501, Pub.L. 103-316, 108 Stat. 1723; sec. 
307, Pub.L. 103-332, 108 Stat. 2499; E.O. 12549, 3 CFR, 1986 Comp., 
p. 189; E.O. 12674, 3 CFR, 1989 Comp., 215; E.O. 12689, 3 CFR, 1989 
Comp., p. 235; E.O. 12731, 3 CFR, 1990 Comp., p. 306; OMB Circular 
A-102; OMB Circular A-110; OMB Circular A-128; and OMB Circular A-
133.

Subpart D--Governmentwide Debarment and Suspension (Nonprocurement) 
and Governmentwide Requirements for Drug-Free Workplace (Grants)

    2. Section 12.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 12.105 and 12.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 12.200, 12.215, 12.220, and 12.225 and Appendices A and 
B to Subpart D of Part 12 are revised as set forth at the end of the 
common preamble.
    5. Section 12.110 is further amended by adding paragraphs 
(a)(2)(ix), (x), and (xi), and revising paragraph (a)(3) to read as 
follows:


Sec. 12.110  Coverage.

    (a) * * *
    (2) * * *
    (ix) Under natural resources management programs, permits, 
licenses, exchanges and other acquisitions of real property, rights-of-
way, and easements.
    (x) Transactions concerning mineral patent claims entered into 
pursuant to 30 U.S.C. 22 et seq.
    (xi) Water service contracts and repayment contracts entered into 
pursuant to 43 U.S.C. 485.
    (3) Department of the Interior covered transactions. These 
Department of the Interior regulations apply to the Department's 
domestic assistance covered transactions (whether by a Federal agency, 
recipient, subrecipient, or intermediary) including, except as noted in 
paragraph (a)(2) of this section: grants, cooperative agreements, 
scholarships, fellowships, contracts of assistance, loans, loan 
guarantees, subsidies, insurance, payments for specified use, donation 
agreements, Federal acquisition of a leasehold interest or any other 
interest in real property, concession contracts, dispositions of 
Federal real and personal property and natural resources, subawards, 
subcontracts and transactions at any tier that are charged as direct or 
indirect costs, regardless of type (including subtier awards under 
awards which are statutory entitlement or mandatory awards), and any 
other nonprocurement transactions between the Department and a person.
* * * * *
    6. Section 12.200 is further amended by adding paragraphs (c) (8), 
(9), (10), and (11) as follows:


Sec. 12.200  Debarment or suspension.

* * * * *
    (c) * * *
    (8) Transactions entered into pursuant to Public Law 93-638, 88 
Stat. 2203.
    (9) Under natural resources management programs, permits, licenses, 
exchanges and other acquisitions of real property, rights-of-way, and 
easements.
    (10) Mineral patent claims entered into pursuant to 30 U.S.C. 33 et 
seq.
    (11) Water service contracts and repayment contracts entered into 
pursuant to 43 U.S.C. 485.
BILLING CODE: 4310-RF-M
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FEDERAL EMERGENCY MANAGEMENT AGENCY

44 CFR Part 17

for further information contact: Robert R. Boyer, Operations Support 
Directorate, Federal Emergency Management Agency, 500 C Street SW., 
Washington, DC 20472, (202) 646-2976.

List of Subjects in 44 CFR Part 17

    Administration practice and procedure, Contract programs, Drug 
abuse, Grant programs, Loan programs, Reporting and recordkeeping 
requirements.

    Dated: June 7, 1995.
Harvey G. Ryland,
Deputy Director.

    Title 44 of the Code of Federal Regulations, part 17 is amended as 
follows.

PART 17--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 17 is revised to read as follows:

    Authority: 41 U.S.C. 701 et seq.; E.O. 12549, 51 FR 6370, 3 CFR, 
1986 Comp., p. 189; E.O. 12689, 54 FR 34131, 3 CFR, 1989 Comp., p. 
235.

    2. Section 17.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 17.105 and 17.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 17.200, 17.215, 17.220, and 17.225, and Appendices A 
and B to part 17 are revised as set forth at the end of the common 
preamble.
BILLING CODE 6718-01-M
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DEPARTMENT OF HEALTH AND HUMAN SERVICES

45 CFR Part 76

RIN 0991-AA78
for further information contact: Neil Steyskal, Office of Grants and 
Acquisition Management, 202-690-5729; TDD 202-690-6415.

additional supplementary information: On January 29, 1992, HHS 
published a final rule governing the Department's exclusion and civil 
monetary penalty authorities, as codified by the Medicare and Medicaid 
Patient and Program Protection Act of 1987, Pub. L. 100-93. These 
authorities have been delegated to the Inspector General for 
implementation. 42 CFR 1001.1901 implements Executive Order 12549 which 
provides that debarments, suspensions, and other exclusionary actions 
taken by any Federal agency will have governmentwide effect with 
respect to all nonprocurement programs. Specifically, 42 CFR 1001.1901 
makes clear that exclusions from Medicare and State health care 
programs under Title XI of the Social Security Act, 42 U.S.C. 1320a-7, 
are also applicable with respect to ``all other Federal nonprocurement 
programs.''
    With the enactment of the Federal Acquisition Streamlining Act of 
1994 (FASA), Pub. L. 103-355, Congress mandated and expanded the 
governmentwide effect of debarments, suspensions, and other 
exclusionary actions to procurement as well as nonprocurement programs. 
In addition to the amendments to the Common Rule which the enactment of 
FASA necessitates, we are also taking this opportunity to codify in the 
Department's adoption of the Common Rule, the Department's policy that 
exclusions imposed under Title XI of the Social Security Act have the 
same governmentwide effect as debarments initiated under the Common 
Rule, and shall be recognized and given effect, not only for all 
Departmental programs, but also for all other Executive Branch 
procurement and nonprocurement programs and activities. Moreover, 
[[Page 33062]] because full due process is provided under the statute 
and the implementing regulations for those excluded under Title XI, 
including the right to an administrative hearing and judicial review, 
additional due process under the Common Rule is not necessary nor 
available to excluded individuals and entities beyond that set forth in 
42 CFR Parts 1001 and 1005.

List of Subjects in 45 CFR Part 76

    Administrative practice and procedure, Contract programs, Grant 
programs.

    Dated: June 5, 1995.
Donna A. Shalala,
Secretary.

    Title 45 of the Code of Federal Regulations, part 76 is amended as 
follows.
PART 76--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 76 is revised to read as follows:

    Authority: 5 U.S.C. 301; 41 U.S.C. 701 et seq.; Sec. 2455, Pub. 
L. 103-355, 108 Stat. 3327 (31 U.S.C. 6101 note; E.O. 12549, 3 CFR, 
1986 Comp., p. 189; E.O. 12689, 3 CFR, 1989 Comp., p. 235.

    2. Section 76.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 76.105 and 76.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 76.200, 76.215, 76.220, and 76.225 and Appendices A and 
B to Part 76 are revised as set forth at the end of the common 
preamble.
    5. Section 74.110 is further amended by adding a new paragraph (d) 
to read as follows:


Sec. 74.110  Coverage.

* * * * *
    (d) Relationship to Medicare and State Health Care Program 
Exclusions. Any exclusion from Medicare and State health care program 
participation by HHS under Title XI of the Social Security Act, 42 
U.S.C. 1320a-7, (see also 42 CFR 1001.1901) on or after August 25, 1995 
shall be recognized by and effective, not only for all HHS programs, 
but also for all other Executive Branch procurement and nonprocurement 
activities.
BILLING CODE: 4150-04-M
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NATIONAL SCIENCE FOUNDATION

45 CFR Part 620

RIN 3145-AA28
FOR FURTHER INFORMATION CONTACT: Anita Eisenstadt, Assistant General 
Counsel, Office of the General Counsel, 703-306-1060.

List of Subjects in 22 CFR Part 620

    Administrative practice and procedure, Contract programs, Grant 
programs.
Lawrence Rudolph,
General Counsel.

    Title 45 of the Code of Federal Regulations, part 620 is amended as 
follows.

PART 620--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 620 is revised to read as follows:

    Authority: 41 U.S.C. 701 et seq.; 42 U.S.C. 1870(a); E.O. 12549, 
3 CFR, 1986 Comp., p. 189.

    2. Section 620.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 620.105 and 620.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 620.200, 620.215, 620.220, and 620.225 and Appendices A 
and B to Part 620 are revised as set forth at the end of the common 
preamble.
BILLING CODE: 7555-01-M
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NATIONAL FOUNDATION ON THE ARTS AND THE HUMANITIES

National Endowment for the Arts

45 CFR Part 1154

RIN 3135-AA12
FOR FURTHER INFORMATION CONTACT: Ms. Donna DiRicco, Acting Grants 
Officer, National Endowment for the Arts, (202) 682-5403.

List of Subjects in 45 CFR Part 1154

    Administrative practice and procedure, Contract programs, Drug 
abuse, Grant programs, Loan programs, Reporting and recordkeeping 
requirements.
Laurence Baden,
Deputy Chairman for Management.

    Title 45 of the Code of Federal Regulations, Part 1154 is amended 
as follows.

PART 1154--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1154 is revised to read as follows:

    Authority: 20 U.S.C. 959(a)(1); 41 U.S.C. 701 et seq.; E.O. 
12549, 3 CFR, 1986 comp., p. 189.

    2. Section 1154.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 1154.105 and 1154.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1154.200, 1154.215, 1154.220, and 1154.225 and 
Appendices A and B to Part 1154 are revised as set forth at the end of 
the common preamble.
BILLING CODE 7537-01-M
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NATIONAL FOUNDATION ON THE ARTS AND THE HUMANITIES
National Endowment for the Humanities

45 CFR Part 1169

RIN 3136-AA20
FOR FURTHER INFORMATION CONTACT: David C. Fisher, Deputy General 
Counsel, National Endowment for the Humanities, Room 530, Washington, 
DC 20506, (202) 606-8322.

List of Subjects in 45 CFR Part 1169

    Administrative practice and procedure, Contract programs, Drug 
abuse, Grant programs, Loan programs, Reporting and recordkeeping 
requirements.
Sheldon Hackney,
Chairman.

    Title 45 of the Code of Federal Regulations, part 1169 is amended 
as follows.

PART 1169--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1169 is revised to read as follows.

    Authority: 20 U.S.C. 959(a)(1); 41 U.S.C. 701 et seq.; E.O. 
12549, 3 CFR, 1986 Comp., p. 189; E.O. 12689, 3 CFR, 1989 Comp., p. 
235.

    2. Section 1169.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 1169.105 and 1169.110 are amended as set forth at the 
end of the common preamble. [[Page 33063]] 
    4. Sections 1169.200, 1169.215, 1169.220 and 1169.225 and 
Appendices A and B to Part 1169 are revised as set froth at the end of 
the common preamble.
BILLING CODE 7036-01-M
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NATIONAL FOUNDATION ON THE ARTS AND THE HUMANITIES
INSTITUTE OF MUSEUM SERVICES

45 CFR Part 1185

FOR FURTHER INFORMATION CONTACT: Rebecca Danvers, Program Director, 
202-606-8539.

List of subjects in 45 CFR Part 1185

    Administrative practice and procedure, Contract programs, Drug 
abuse, Grant programs, Loan programs, Reporting and recordkeeping 
requirements.
Diane B. Frankel,
Director.

    Title 45 of the Code of Federal Regulations, Part 1185 is amended 
as follows.

PART 1185--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 1185 is revised to read as follows:

    Authority: 20 U.S.C. 961-968; 41 U.S.C. 701 et seq.; E.O. 12549, 
3 CFR, 1986 Comp., p. 189.

    2. Section 1185.100 is revised as set forth at the end of the 
common preamble.
    3. Sections 1185.105 and 1185.110 are amended as set forth at the 
end of the common preamble.
    4. Sections 1185.200, 1180.215, 1190.220, and 118.225 and 
Appendices A and B to Part 1185 are revised as set forth at the end of 
the common preamble.
BILLING CODE 7036-01-M
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CORPORATION FOR NATIONAL AND COMMUNITY SERVICE

45 CFR Part 2542

RIN 3045-AA11
FOR FURTHER INFORMATION CONTACT: Michael Kenefick, Director of Grants 
and Contracts, 202-606-5000 ext. 101.

List of Subjects in 45 CFR Part 2542

    Administrative practice and procedure, Contract programs, 
Government contracts, Grant programs.
Gary Kowalczyk,
Acting Chief Financial Officer.

    Title 45 of the Code of Federal Regulations, part 2542 is amended 
as follows.

PART 2542--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 2542 continues to read as follows:

    Authority: 42 U.S.C. 12501 et seq.

    2. Section 2542.10 [________ .100] is revised as set forth at the 
end forth at the end of the common preamble.
    3. Sections 2542.20 [________ .105] and 2542.30 [________ .110] are 
amended as set forth at the end of the common preamble.
    4. Sections 2542.100 [________ .200], 2542.130 [________ .215], 
2542.140 [________ .220], and 2542.150 [________ .225] and Appendices A 
and B to Part 2542 are revised as set forth at the end of the common 
preamble.
    5. Section 2542.10 is further amended in paragraph (b)(3) by 
removing ``Sec. ________ .105'' and adding ``Sec. 2542.20'' in its 
place.
    6. Section 2542.100 is further amended in paragraph (a) by removing 
``Sec. ________ .215'' and adding ``Sec. 2542.130'' in its place and in 
paragraph (c) by removing ``Sec. ________ .110(a)(1)(ii)'' and adding 
``Sec. 2542.30(a)(1)(ii)'' in its place.
    7. Section 2542.130 is further amended by removing ``Sec. ________ 
.200'' and ``Sec. ________ .505(a)'' and adding ``Sec. 2542.100'' and 
``Sec. 2542.410(a)'', respectively.
    8. Section 2542.140 is further amended in paragraph (b) by removing 
``Sec. ________ .215'' and adding ``Sec. 2542.130'' in its place.
    9. Section 2542.150 is further amended in paragraph (a) by removing 
``Sec. ________ .215 or Sec. ________ .220'' and adding 
``Sec. 2542.130'' or Sec. 2542.140'' in its place.
BILLING CODE 6050-28-M
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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

49 CFR Part 29

RIN 2105-AC25
ACTION: Interim final rule with an opportunity to comment.

-----------------------------------------------------------------------

DATES: This interim final rule is effective August 25, 1995. Comments 
should be received by July 26, 1995. Late filed comments will be 
considered to the extent practicable.

FOR FURTHER INFORMATION CONTACT: Paul B. Larsen, Office of the General 
Counsel, C-10, Room 10102, (202) 366-9161, or Ladd Hakes, Office of 
Acquisition and Grants Management, M-62, Room 9401, (202) 366-4268, 
Department of Transportation, 400 Seventh Street, S.W., Washington, 
D.C. 20590.

ADDITIONAL SUPPLEMENTARY INFORMATION:

Background

    The Department of Transportation's implementation of the 
governmentwide common rule adds a requirement for reciprocity between 
procurement and nonprocurement debarment and suspension actions.
    The Department's rule is interim final because the Department did 
not clear the governmentwide Notice of Proposed Rule Making (NPRM) in 
time for publication. For the sake of uniformity and to avoid 
confusion, the Department now needs to join in the governmentwide rule.
    The Department of Transportation is responsible for administering 
both procurement and nonprocurement debarment and suspension actions. 
Prior to October 1, 1994, the individual DOT Operating Administrations 
administered both procurement and nonprocurement actions. Beginning 
October 1, 1994, the DOT Office of Acquisition and Grant Management 
became responsible for administering procurement actions.

List of Subjects in 49 CFR Part 29

    Administrative practice and procedure, Contract programs, Drug 
abuse, Grant programs, Loan programs, Reporting and recordkeeping 
requirements.
Federico Pena,
Secretary of Transportation.

    Title 49 of the Code of Federal Regulations, part 29 is amended as 
follows. [[Page 33064]] 

PART 29--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) 
AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)

    1. The authority for part 29 is revised to read as follows:

    Authority: 41 U.S.C. 701 et seq.; 49 U.S.C. 322(a); E.O. 12549, 
3 CFR, 1986 Comp., p. 189.

    2. Section 29.100 is revised as set forth at the end of the common 
preamble.
    3. Sections 29.105 and 29.110 are amended as set forth at the end 
of the common preamble.
    4. Sections 29.200, 29.215, 29.220, and 29.225, and Appendices A 
and B to Part 29 are revised as set forth at the end of the common 
preamble.
[FR Doc. 95-14725 Filed 6-23-95; 8:45 am]
BILLING CODE 4910-62-M