[Federal Register Volume 69, Number 117 (Friday, June 18, 2004)]
[Proposed Rules]
[Pages 34248-34249]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-13762]



[[Page 34247]]

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Part III





General Services Administration





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48 CFR Part 509



General Services Acquisition Regulation; Debarment, Suspension, and 
Ineligibility; Proposed Rule

  Federal Register / Vol. 69, No. 117 / Friday, June 18, 2004 / 
Proposed Rules  

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GENERAL SERVICES ADMINISTRATION

48 CFR Part 509

GSAR 2004-G502
RIN 3090-AH97


General Services Acquisition Regulation; Debarment, Suspension, 
and Ineligibility

AGENCY: Office of Acquisition Policy, General Services Administration 
(GSA).

ACTION: Proposed rule with request for comments.

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SUMMARY: The General Services Administration (GSA) is proposing to 
amend the General Services Acquisition Regulation (GSAR) to add an 
additional procedure to the decision-making process for the debarment 
and suspension of parties.

DATES: Interested parties should submit comments in writing on or 
before August 17, 2004 to be considered in the formulation of a final 
rule.

ADDRESSES: Submit printed comments to General Services Administration, 
Regulatory Secretariat (MVA), 1800 F Street, NW, Room 4035, ATTN: 
Laurie Duarte, Washington, DC 20405. Submit electronic comments via the 
Internet to the U.S. Government's rulemaking website at http://www.regulations.gov, or to GSA's e-mailbox at [email protected].
    Please submit comments only and cite GSAR case 2004-G502 in all 
correspondence related to this case.

FOR FURTHER INFORMATION CONTACT: The Regulatory Secretariat, Room 4035, 
GS Building, Washington, DC 20405, (202) 501-4755, for information 
pertaining to status or publication schedules. For clarification of 
content, contact Mr. Ernest Woodson, Procurement Analyst, at (202) 501-
3775, or by e-mail at [email protected]. Please cite GSAR case 
2004-G502.

SUPPLEMENTARY INFORMATION:

A. Background

    GSAR 509.406-3(d) and 509.407-3 provide the decision-making 
processes for determining whether parties should be suspended or 
proposed for debarment, including contractors, principles, and 
affiliates. The procedures supplement Federal Acquisition Regulation 
(FAR) Subpart 9.4, Debarment, Suspension, and Ineligibility, that 
prescribes policies and procedures governing the suspension and 
debarment of contractors who are determined not to be responsible by 
Federal agencies. It is the Government's policy to solicit offers from, 
award contracts to, award task or delivery orders against existing 
contracts, and consent to subcontracts with responsible contractors 
only. The serious nature of suspension or debarment requires that 
agencies impose the sanctions only in the public interest for the 
Government's protection. Suspension or debarment is not to be imposed 
as punishment for prior bad acts.
    The proposed rule would provide parties who are being considered 
for suspension or debarment with a Show Cause Notice. Currently, there 
is no requirement to notify a contractor that GSA is considering a 
suspension or debarment action. In some recent cases, contractors 
obtained information through leaked information to the press about 
recommendations to suspend or debar them, giving them the advantage of 
being able to come in and talk to the GSA Suspension/Debarment 
Official, while others found out that they were being considered for 
suspension/debarment when they received either the suspension or the 
proposed debarment by mail or fax. It is important to note that GSA 
encourages any of its private sector partners to come in and discuss 
with the Suspension/Debarment Official instances they have discovered 
where their responsibility may be placed in question and what steps 
they have taken to remedy the situation. We encourage a proactive 
approach by our industry partners in dealing with matters that put 
their responsibility in question.
    The Show Cause Notice would be sent before issuance of a Notice of 
Suspension or a Notice of Proposed Debarment except in those cases 
where the government would be harmed by waiting any period of time to 
suspend or propose the debarment of the contractor. The additional 
period of time will not impact a party's right to respond to a Notice 
of Suspension or a Notice of Proposed Debarment within 30 calendar days 
after its receipt; these two notices trigger placement of a party on 
the List of Parties Excluded from Federal Procurement and 
Nonprocurement Programs, but the Show Cause Notice would not.
    By providing the additional time period, GSA intends to give 
parties who are being considered for possible suspension or debarment, 
the ability to informally respond to allegations that affect the 
responsibility of the contractor.
    This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of Executive Order 12866, 
Regulatory Planning and Review, dated September 30, 1993. This rule is 
not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    The General Services Administration does not expect this proposed 
rule to have a significant economic impact on a substantial number of 
small entities within the meaning of the Regulatory Flexibility Act, 5 
U.S.C. 601, et seq., because the proposed rule primarily supplements 
existing GSAR procedures that provide the decision-making process for 
determining the suspension or debarment of parties. One hundred and 
thirteen contractors were suspended or debarred by GSA in 2003, and 
this included both large and small businesses. GSA will consider 
comments from small entities concerning the affected GSAR Subpart 509.4 
in accordance with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite GSAR case 2004-G502, in 
correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
changes to the GSAR do not impose information collection requirements 
that require the approval of the Office of Management and Budget under 
44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Part 509

    Government procurement.

    Dated: June 10, 2004.
David A. Drabkin,
Deputy Associate Administrator, Office of Acquisition Policy.
    Therefore, GSA proposes changes to 48 CFR part 509 as set forth 
below:

PART 509--DEBARMENT, SUSPENSION, AND ELIGIBILITY

    1. The authority citation for 48 CFR part 509 continues to read as 
follows:

    Authority: 40 U.S.C. 486(c).

    2. Amend section 509.406-3 by redesignating paragraphs (d)(2) and 
(d)(3) as (d)(3) and (d)(4), by adding a new paragraph (d)(2), and in 
newly designated (d)(3) by redesignating (d)(3)(i) through (iv) as 
(d)(3)(ii) through (v), and adding a new (d)(3)(i) to read as follows:


509.406-3  Procedures.

* * * * *
    (d) Decision-making process. * * *
    (2) The debarring official must provide a Show Cause Notice to each 
party being considered for debarment, before issuing a Notice of 
Proposed Debarment. However, a Show Cause Notice need not be provided 
if--

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    (i) The debarring official, in her/his sole discretion, has 
determined that any delay in issuing the Notice of Proposed Debarment 
would cause imminent harm to the Government; or,
    (ii) A suspension is already in effect.
    (3) * * *
    (i) May informally respond to a Show Cause Notice, but has no 
obligation to do so.
* * * * *


509.407-3  [Amended]

    3. Amend 509.407-3(b)(2)(ii) by removing the reference ``509.406-
3(d)(3)'' and adding ``509.406-3(d)(4)'' in its place.
[FR Doc. 04-13762 Filed 6-17-04; 8:45 am]
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