[Federal Register Volume 84, Number 193 (Friday, October 4, 2019)]
[Rules and Regulations]
[Pages 52993-52997]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-20865]



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 Rules and Regulations
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 This section of the FEDERAL REGISTER contains regulatory documents 
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  Federal Register / Vol. 84, No. 193 / Friday, October 4, 2019 / Rules 
and Regulations  

[[Page 52993]]



DEPARTMENT OF AGRICULTURE

2 CFR Part 417

Federal Crop Insurance Corporation

7 CFR Part 400

[0505-AA17]


Nonprocurement Debarment and Suspension

AGENCY: Office of the Chief Financial Officer and Federal Crop 
Insurance Corporation, USDA.

ACTION: Final rule.

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

SUMMARY: The USDA issues this final rule to adopt certain provisions of 
the Office of Management and Budget (OMB) guidelines to agencies on 
governmentwide debarment and suspension (nonprocurement) not previously 
adopted, to adopt changes made to the OMB guidance after its initial 
publication in 2010, and to revise the definition of the term 
``disqualified'' to add the statutory disqualification requirements for 
USDA agencies. Finally, this rule removes a reference to the old USDA 
suspension and debarment regulations for the Federal Crop Insurance 
Corporation and replaces it with the current regulations. This 
regulatory action makes no substantive changes in USDA policy or 
procedures for nonprocurement debarment and suspension.

DATES: This final rule is effective as of October 4, 2019.

FOR FURTHER INFORMATION CONTACT: Tyson Whitney, Director, Transparency 
and Accountability Reporting Division, Office of the Chief Financial 
Officer, Room 3027-S, Stop Code 9011, U.S. Department of Agriculture, 
1400 Independence Avenue SW, Washington, DC 20250; (202) 720-8978; 
[email protected].

SUPPLEMENTARY INFORMATION: 

Background

    USDA published a direct final rule on May 25, 2010, to adopt the 
OMB guidelines to agencies on nonprocurement debarment and suspension 
as 2 CFR part 417 (75 FR 29183). USDA issues this final rule to adopt 
subpart E, General Services Administration's System for Award 
Management (GSA/SAM) (formerly Excluded Parties List System) and 
subpart F, General Principles Relating to Suspension and Debarment, of 
2 CFR part 180. It also revises 2 CFR part 417 to amend subpart I to 
add the definition of ``disqualified'' in 2 CFR 417.935, as 
supplemented to include the statutory disqualifications required under 
USDA programs, and the definition of ``nonprocurement transaction'' in 
2 CFR 417.970, and to adopt the Appendix to Part 180--Covered 
Transactions. Finally, this rule amends 7 CFR part 400 to replace a 
reference to the old USDA suspension and debarment regulations in 7 CFR 
400.454.

Discussion and Analysis

    The amendment to part 417 adopts subparts and definitions in the 
OMB guidelines to agencies on nonprocurement debarment and suspension 
not previously adopted and captures updates to 2 CFR part 180 that have 
occurred since 2010. These include Subpart E, General Services 
Administration's System for Award Management (GSA/SAM) (formerly 
Excluded Parties List System); Subpart F, General Principles Relating 
to Suspension and Debarment; definitions added in 2 CFR 180.935, as 
supplemented to include USDA statutory disqualifications, and 2 CFR 
180.970; and Appendix to Part 180--Covered Transactions. This rule also 
replaces a reference to 7 CFR part 3017 in 7 CFR 400.454 with a 
reference to 2 CFR part 417. This regulatory action is a technical 
update of the rule and does not represent a change in current USDA 
nonprocurement debarment and suspension policy or procedures.

Executive Order 12866 Regulatory Planning and Review

    This rule is issued in conformance with Executive Order 12866, 
``Regulatory Planning and Review.'' It has been determined to be not 
significant for the purposes of Executive Order 12866 and, therefore, 
was not reviewed by the Office of Management and Budget. Pursuant to 
the Congressional Review Act (5 U.S.C. 801 et seq.), the Office of 
Information and Regulatory Affairs designated this rule as not a major 
rule, as defined by 5 U.S.C. 804(2).

IV. Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b))

    This regulatory action will not have a significant, adverse impact 
on a substantial number of small entities.

V. Unfunded Mandates Act of 1995 (Sec. 202, Pub. L. 104-4)

    This regulatory action does not contain a Federal mandate that will 
result in the expenditure by State, local, and Tribal governments, in 
aggregate, or by the private sector of $100 million or more in any one 
year.

VI. Paperwork Reduction Act of 1995 (44 U.S.C., Chapter 35)

    This regulatory action will not impose any additional reporting or 
recordkeeping requirements under the Paperwork Reduction Act.

VII. Federalism (Executive Order 13132)

    This regulatory action does not have Federalism implications, as 
set forth in Executive Order 13132. It will not have substantial direct 
effects on the States, on the relationship between the Federal 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government, except as 
required by law. This rule does not impose substantial direct 
compliance costs on State and local governments. Therefore, 
consultation with the States was not required.

VIII. Executive Order 13175 (Consultation and Coordination With Indian 
Tribal Governments)

    Executive Order 13175, entitled ``Consultation and Coordination 
With Indian Tribal Governments'' (65 FR 67249, November 9, 2000), 
requires agencies to develop an accountable process to ensure 
``meaningful and timely input by tribal officials in the development of 
regulatory policies that have tribal implications.'' This rule does not 
have tribal implications, as specified in Executive Order 13175.

[[Page 52994]]

List of Subjects

2 CFR Part 417

    Administrative practice and procedure, Grant programs, Reporting 
and recordkeeping requirements.

7 CFR Part 400

    Acreage allotments, Administrative practice and procedure, Claims, 
Crop insurance, Drug traffic control, Fraud, Government employees, 
Income taxes, Intergovernmental relations, Penalties, Reporting and 
recordkeeping requirements, Wages.

    For the reasons discussed in the preamble, the Department of 
Agriculture amends 2 CFR part 417 and 7 CFR part 400 as follows:

Title 2--Grants and Agreements

CHAPTER IV--DEPARTMENT OF AGRICULTURE

PART 417--NONPROCUREMENT DEBARMENT AND SUSPENSION

0
1. The authority citation for part 417 continues to read as follows:

    Authority:  5 U.S.C. 301; Pub. L. 101-576, 104 Stat. 2838; Sec. 
2455, Pub. L. 103-355, 108 Stat. 3327 (31 U.S.C. 6101 note); 7 
U.S.C. 2209j; E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O. 12689 (3 
CFR, Comp., p. 235); 7 CFR 2.28.


0
2. Add subpart E, consisting of Sec. Sec.  417.500 through 417.530, to 
read as follows:
Subpart E--System for Award Management Exclusions
Sec.
417.500 What is the purpose of the System for Award Management 
Exclusions (SAM Exclusions)?
417.505 Who uses SAM Exclusions?
417.510 Who maintains SAM Exclusions?
417.515 What specific information is in SAM Exclusions?
417.520 Who places the information into SAM Exclusions?
417.525 Whom do I ask if I have questions about a person in SAM 
Exclusions?
417.530 Where can I find SAM Exclusions?

Subpart E--System for Award Management Exclusions


Sec.  417.500  What is the purpose of the System for Award Management 
Exclusions (SAM Exclusions)?

    SAM Exclusions is a widely available source of the most current 
information about persons who are excluded or disqualified from covered 
transactions.


Sec.  417.505  Who uses SAM Exclusions?

    (a) Federal agency officials use SAM Exclusions to determine 
whether to enter into a transaction with a person, as required under 
Sec.  180.430 of this title.
    (b) Participants also may, but are not required to, use SAM 
Exclusions to determine if--
    (1) Principals of their transactions are excluded or disqualified, 
as required under Sec.  180.320 of this title; or
    (2) Persons with whom they are entering into covered transactions 
at the next lower tier are excluded or disqualified.
    (c) SAM Exclusions are available to the general public.


Sec.  417.510  Who maintains SAM Exclusions?

    The General Services Administration (GSA) maintains SAM Exclusions. 
When a Federal agency takes an action to exclude a person under the 
nonprocurement or procurement debarment and suspension system, the 
agency enters the information about the excluded person into SAM 
Exclusions.


Sec.  417.515  What specific information is in SAM Exclusions?

    (a) At a minimum, SAM Exclusions indicates--
    (1) The full name (where available) and address of each excluded 
and disqualified person, in alphabetical order, with cross references 
if more than one name is involved in a single action;
    (2) The type of action;
    (3) The cause for the action;
    (4) The scope of the action;
    (5) Any termination date for the action;
    (6) The Federal agency and name and telephone number of the agency 
point of contact for the action; and
    (7) The unique entity identifier approved by the GSA, of the 
excluded or disqualified person, if available.
    (b)(1) The database for SAM Exclusions includes a field for the 
Taxpayer Identification Number (TIN) (the social security number (SSN) 
for an individual) of an excluded or disqualified person.
    (2) Agencies disclose the SSN of an individual to verify the 
identity of an individual, only if permitted under the Privacy Act of 
1974 and, if appropriate, the Computer Matching and Privacy Protection 
Act of 1988, as codified in 5 U.S.C. 552(a).


Sec.  417.520   Who places the information into SAM Exclusions?

    Federal agency officials who take actions to exclude persons under 
this part or officials who are responsible for identifying disqualified 
persons must enter the following information about those persons into 
SAM Exclusions:
    (a) Information required by Sec.  180.515(a) of this title;
    (b) The Taxpayer Identification Number (TIN) of the excluded or 
disqualified person, including the social security number (SSN) for an 
individual, if the number is available and may be disclosed under law;
    (c) Information about an excluded or disqualified person, within 
three business days, after--
    (1) Taking an exclusion action;
    (2) Modifying or rescinding an exclusion action;
    (3) Finding that a person is disqualified; or
    (4) Finding that there has been a change in the status of a person 
who is listed as disqualified.


Sec.  417.525  Whom do I ask if I have questions about a person in SAM 
Exclusions?

    If you have questions about a listed person in SAM Exclusions, ask 
the point of contact for the Federal agency that placed the person's 
name into SAM Exclusions. You may find the agency point of contact from 
SAM Exclusions.


Sec.  417.530  Where can I find SAM Exclusions?

    You may access SAM Exclusions through the internet, currently at 
https://www.sam.gov.

0
3. Add subpart F, consisting of Sec. Sec.  417.600 through 417.660, to 
read as follows:
Subpart F--General Principles Relating to Suspension and Debarment 
Actions
Sec.
417.600 How do suspension and debarment actions start?
417.605 How does suspension differ from debarment?
417.610 What procedures does a Federal agency use in suspension and 
debarment actions?
417.615 How does a Federal agency notify a person of a suspension or 
debarment action?
417.620 Do Federal agencies coordinate suspension and debarment 
actions?
417.625 What is the scope of a suspension or debarment?
417.630 May a Federal agency impute the conduct of one person to 
another?
417.635 May a Federal agency settle a debarment or suspension 
action?
417.640 May a settlement include a voluntary exclusion?
417.645 Do other Federal agencies know if an agency agrees to a 
voluntary exclusion?
417.650 May an administrative agreement be the result of a 
settlement?
417.655 How will other Federal awarding agencies know about an 
administrative agreement that is the result of a settlement?
417.660 Will administrative agreement information about me in the 
designated integrity and performance system accessible through SAM 
be corrected or updated?

[[Page 52995]]

Subpart F--General Principles Relating to Suspension and Debarment 
Actions


Sec.  417.600  How do suspension and debarment actions start?

    When Federal agency officials receive information from any source 
concerning a cause for suspension or debarment, they will promptly 
report it and the agency will investigate. The officials refer the 
question of whether to suspend or debar you to their suspending or 
debarring official for consideration, if appropriate.


Sec.  417.605  How does suspension differ from debarment?

               Suspension Differs From Debarment in That--
------------------------------------------------------------------------
      A suspending official . . .           A debarring official . . .
------------------------------------------------------------------------
(a) Imposes suspension as a temporary    Imposes debarment for a
 status of ineligibility for              specified period as a final
 procurement and nonprocurement           determination that a person is
 transactions, pending completion of an   not presently responsible.
 investigation or legal proceedings.
(b) Must--
    (1) Have ``adequate evidence'' that
     there may be a cause for debarment
     of a person; and.
    (2) Conclude that ``immediate        Must conclude, based on a
     action'' is necessary to protect     ``preponderance of the
     the Federal interest.                evidence,'' that the person
                                          has engaged in conduct that
                                          warrants debarment.
(c) Usually imposes the suspension       Imposes debarment ``after''
 ``first,'' and then promptly notifies    giving the respondent notice
 the suspended person, giving the         of the action and an
 person an opportunity to contest the     opportunity to contest the
 suspension and have it lifted.           proposed debarment.
------------------------------------------------------------------------

Sec.  417.610  What procedures does a Federal agency use in suspension 
and debarment actions?

    In deciding whether to suspend or debar you, a Federal agency 
handles the actions as informally as practicable, consistent with 
principles of fundamental fairness.
    (a) For suspension actions, a Federal agency uses the procedures in 
this subpart and subpart G of this part.
    (b) For debarment actions, a Federal agency uses the procedures in 
this subpart and subpart H of this part.


Sec.  417.615   How does a Federal agency notify a person of a 
suspension or debarment action?

    (a) The suspending or debarring official sends a written notice to 
the last known street address, facsimile number, or email address of--
    (1) You or your identified counsel; or
    (2) Your agent for service of process, or any of your partners, 
officers, directors, owners, or joint venturers.
    (b) The notice is effective if sent to any of these persons.


Sec.  417.620  Do Federal agencies coordinate suspension and debarment 
actions?

    Yes, when more than one Federal agency has an interest in a 
suspension or debarment, the agencies may consider designating one 
agency as the lead agency for making the decision. Agencies are 
encouraged to establish methods and procedures for coordinating their 
suspension and debarment actions.


Sec.  417.625   What is the scope of a suspension or debarment?

    If you are suspended or debarred, the suspension or debarment is 
effective as follows:
    (a) Your suspension or debarment constitutes suspension or 
debarment of all of your divisions and other organizational elements 
from all covered transactions, unless the suspension or debarment 
decision is limited--
    (1) By its terms to one or more specifically identified 
individuals, divisions, or other organizational elements; or
    (2) To specific types of transactions.
    (b) Any affiliate of a participant may be included in a suspension 
or debarment action if the suspending or debarring official--
    (1) Officially names the affiliate in the notice; and
    (2) Gives the affiliate an opportunity to contest the action.


Sec.  417.630   May a Federal agency impute the conduct of one person 
to another?

    For purposes of actions taken under this part, a Federal agency may 
impute conduct as follows:
    (a) Conduct imputed from an individual to an organization. A 
Federal agency may impute the fraudulent, criminal, or other improper 
conduct of any officer, director, shareholder, partner, employee, or 
other individual associated with an organization, to that organization 
when the improper conduct occurred in connection with the individual's 
performance of duties for or on behalf of that organization, or with 
the organization's knowledge, approval or acquiescence. The 
organization's acceptance of the benefits derived from the conduct is 
evidence of knowledge, approval or acquiescence.
    (b) Conduct imputed from an organization to an individual, or 
between individuals. A Federal agency may impute the fraudulent, 
criminal, or other improper conduct of any organization to an 
individual, or from one individual to another individual, if the 
individual to whom the improper conduct is imputed either participated 
in, had knowledge of, or reason to know of the improper conduct.
    (c) Conduct imputed from one organization to another organization. 
A Federal agency may impute the fraudulent, criminal, or other improper 
conduct of one organization to another organization when the improper 
conduct occurred in connection with a partnership, joint venture, joint 
application, association or similar arrangement, or when the 
organization to whom the improper conduct is imputed has the power to 
direct, manage, control, or influence the activities of the 
organization responsible for the improper conduct. Acceptance of the 
benefits derived from the conduct is evidence of knowledge, approval, 
or acquiescence.


Sec.  417.635   May a Federal agency settle a debarment or suspension 
action?

    Yes, a Federal agency may settle a debarment or suspension action 
at any time if it is in the best interest of the Federal Government.


Sec.  417.640  May a settlement include a voluntary exclusion?

    Yes, if a Federal agency enters into a settlement with you in which 
you agree to be excluded, it is called a voluntary exclusion and has 
governmentwide effect.

[[Page 52996]]

Sec.  417.645  Do other Federal agencies know if an agency agrees to a 
voluntary exclusion?

    (a) Yes, the Federal agency agreeing to the voluntary exclusion 
enters information about it into SAM Exclusions.
    (b) Also, any agency or person may contact the Federal agency that 
agreed to the voluntary exclusion to find out the details of the 
voluntary exclusion.


Sec.  417.650  May an administrative agreement be the result of a 
settlement?

    Yes, a Federal agency may enter into an administrative agreement 
with you as part of the settlement of a debarment or suspension action.


Sec.  417.655  How will other Federal awarding agencies know about an 
administrative agreement that is the result of a settlement?

    The suspending or debarring official who enters into an 
administrative agreement with you must report information about the 
agreement to the designated integrity and performance system within 
three business days after entering into the agreement. This information 
is required by section 872 of the Duncan Hunter National Defense 
Authorization Act for Fiscal Year 2009 (41 U.S.C. 2313).


Sec.  417.660  Will administrative agreement information about me in 
the designated integrity and performance system accessible through SAM 
be corrected or updated?

    Yes, the suspending or debarring official who entered information 
into the designated integrity and performance system about an 
administrative agreement with you:
    (a) Must correct the information within three business days if he 
or she subsequently learns that any of the information is erroneous.
    (b) Must correct in the designated integrity and performance 
system, within three business days, the ending date of the period 
during which the agreement is in effect, if the agreement is amended to 
extend that period.
    (c) Must report to the designated integrity and performance system, 
within three business days, any other modification to the 
administrative agreement.
    (d) Is strongly encouraged to amend the information in the 
designated integrity and performance system in a timely way to 
incorporate any update that he or she obtains that could be helpful to 
Federal awarding agencies who must use the system.

Subpart I--Definitions

0
4. Add Sec.  417.935 to read as follows:


Sec.  417.935   Disqualified (USDA supplement to governmentwide 
definition at 2 CFR 180.935).

    ``Disqualified'' means that a person is prohibited from 
participating in specified Federal procurement or nonprocurement 
transactions as required under a statute, Executive order (other than 
Executive Orders 12549 and 12689) or other authority. Examples of 
disqualifications include persons prohibited under--
    (a) The Davis-Bacon Act (40 U.S.C. 276(a));
    (b) The equal employment opportunity acts and Executive orders; or
    (c) The Clean Air Act (42 U.S.C. 7606), Clean Water Act (33 U.S.C. 
1368) and Executive Order 11738 (3 CFR, 1973 Comp., p. 799);
    (d) 515(h) of the Federal Crop Insurance Act (7 U.S.C. 1515(h));
    (e) Section 12 of the Food and Nutrition Act of 2008 (7 U.S.C. 
2021).

0
5. Add Sec.  417.970 to read as follows:


Sec.  417.970  Nonprocurement transaction.

    (a) ``Nonprocurement transaction'' means any transaction, 
regardless of type (except procurement contracts), including, but not 
limited to the following:
    (1) Grants.
    (2) Cooperative agreements.
    (3) Scholarships.
    (4) Fellowships.
    (5) Contracts of assistance.
    (6) Loans.
    (7) Loan guarantees.
    (8) Subsidies.
    (9) Insurances.
    (10) Payments for specified uses.
    (11) Donation agreements.
    (b) A nonprocurement transaction at any tier does not require the 
transfer of Federal funds.

0
6. Add Appendix 1 to Part 417 to read as follows:

Appendix 1 to Part 417--Covered Transactions

Covered Transactions

[[Page 52997]]

[GRAPHIC] [TIFF OMITTED] TR04OC19.006

Title 7

Chapter IV--Federal Crop Insurance Corporation

PART 400--GENERAL ADMINISTRATIVE REGULATIONS

Subpart R--Administrative Remedies for Non-compliance

0
6. The authority citation for 7 CFR part 400, subpart R, continues to 
read as follows:

    Authority:  7 U.S.C. 1506(l), 1506(o), and 7 U.S.C. 1515(h).


Sec.  400.454   [Amended]

0
7. In Sec.  400.454(e)(3), remove the phrase ``Excluded Parties List 
System (EPLS) in accordance with 7 CFR part 3017, subpart E'' and add 
in its place ``System for Award Management (SAM) in accordance with 2 
CFR part 417''.

Stephen L. Censky,
Deputy Secretary.
[FR Doc. 2019-20865 Filed 10-3-19; 8:45 a.m.]
 BILLING CODE 3410-KS-P