Senators want automatic suspension of contractors

Four Democratic senators are advocating an unrelenting crackdown on defense contractors through automatic suspensions for allegations of bad behavior related to an overseas contingency operation.

Under a new bill, companies would face suspension from their government work for criminal charges, accusations of fraud or if a federal official determines that the contractor failed to pay the government what’s due in connection to an operation overseas.

In February, Sens. Claire McCaskill (D-Mo.) and Jim Webb (D-Va.) introduced the bill, called the Comprehensive Contingency Contracting Reform Act (S. 2139), a follow-up to a report by the Commission on Wartime Contracting in Iraq and Afghanistan. Sens. Al Franken (D-Minn.) and Richard Blumenthal (D-Conn.) quickly added their support for the bill.

The legislation includes another important provision that would forbid contractors to  respond to past-performance evaluations.

The automatic suspension requirement is a bad idea in the eyes of many experts. The Wartime Contracting Commission, backed off its earlier support for the automatic action in its final report. Commission members had concerns that the government doesn’t use its suspension authority enough. Early on, commissioners had said that the government needed to mandate suspensions.

“In its February 2011 interim report, the commission recommended mandatory suspension for contractors indicted on contract-related charges. Following additional research and deliberation, the commission has withdrawn that provision from its recommendations to strengthen enforcement,” reads a footnote in the final report.

The commission instead suggested lawmakers make it less difficult to suspend or debar contingency contractors and require a written rationale if an agency decides against it.

A former senior administration procurement official also disagreed with the automatic suspensions.

Testifying Nov. 16 before Sen. McCaskill, Dan Gordon, former administrator of the Office of Federal Procurement Policy, said mandatory suspensions and debarments undermine the judgment of the agency official who is charged to make those decisions.

“We’re deciding no matter what you’ve done to correct the problem, no matter what remedial measures you’ve taken, you’re going to automatically suspend or debar,” he said. Gordon is now the associate dean for government procurement law studies at George Washington University Law School.

Testifying before the Wartime Contracting Commission in 2011, Gordon said the issues surrounding agencies’ use of suspensions and debarments tie back to managing contracts and overseeing a contractor.

“For too long, we have focused so much on contract awards that we have neglected what must come before and after contract awards—sound acquisition planning and consistent contract management,” Gordon said.

The automatic suspension could cause the entire package to fail to get the Homeland Security and Governmental Affairs Committee’s approval, Alexina Jackson, an associate at the Crowell and Moring law firm, wrote on the firm’s Government Contracts Legal Forum blog.

“The mandatory nature and broad reach of the proposed legislation has drawn significant criticism and concern, leading to questions about the likelihood that the bill will make it out of the committee,” she wrote.

McCaskill is the only committee member among the four supporters. She is chairwoman of its Contracting Oversight Subcommittee.

If the legislation becomes law, contractors will face some stern rules.

“Contractors and agencies could be impacted in their ability to contract and subcontract as charges, agency determinations, and allegations are often made early in a fact-finding process and may take time to reach resolution,” Jackson wrote.

Officials have recognized that need for more contract management, especially after awarding the contract.

In an interview about the upcoming 2012 Acquisition Excellence conference March 29, Kathleen Turco, assistant administrator for governmentwide policy at the General Services Administration, said the topic of suspensions and debarments is “hot, hot, hot.”

The conference’s panel of experts that will discuss the issues surrounding it has generated a lot of interest from industry, the administration and even committee staff in Congress.

Turco and Diana Gowen, senior vice president and general manager at CenturyLink, are co-chairwomen of the conference, which is being hosted by GSA and the American Council for Technology/Industry Advisory Council.

Turco said suspensions and debarments cost money for both agencies and industry. And Gowen said the government shouldn’t be working to have more suspensions and debarments.

“The goal is to educate folks so we don’t have those problems. And if we’ve done that and we don’t have suspensions and debarments, that’s a good thing, not a bad thing,” Gowen said in the interview.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

Reader Comments

Tue, Mar 20, 2012 Dfens USA

So let me get this straight, Congress doesn't mind that the Department of Defense pays these contractors more to screw over the US taxpayer than they do if the contractor comes in on-budget and on-schedule, but if the contractors do what they are given the monetary incentive to do, then these Congress critters want to debar them? Wow, kind of a mixed message, don't you think? I mean, if you really didn't want them to break the bank, why did you allow the DoD to sign them up for a contract that puts the US taxpayer on the hook to pay them $1.10 for every $1.00 they spend on development and production? Heck, if I could get someone to sign me up to a contract like that, I'm sure saving money probably wouldn't be my first priority. So these congretards are sure capitalism will never work, but if it does, we have penalties for anyone who tries to make more money, is that it? Genius, pure genius.

Tue, Mar 20, 2012 Jaime Gracia Washington, DC

More well-intended, but nonetheless knee-jerk reactions to reports of wrongdoing by contractors. The issue is working with industry partners to resolve issues, you know, sound business practices with as little disruption of services as possible. This strategy could backfire severely if mission-critical products and services are disrupted by a contractor accused of wrongdoing, only to be cleared. Guilty until proven innocent is still the norm in this country, last time I checked. What about a reverse bill that punishes federal officials accused of wrongdoing, wasting taxpayer funds, or lacking accountability? Furthermore, what is the push to not allow contractors the opportunity to defense their perform when warranted? These election year political stunts do little to correct the problems inherent in the broken systems and processes that allow wrongdoing to occur in the first place, on both sides of the fence.

Tue, Mar 20, 2012 TACAMO

The GWOT has turned into the GWOC; G/war on contractors. What happened to due process? Maybe when the COs and auditors are faultless you can righfully propose such punitive steps. Extend this logic and there will be no contractors. Or, is that the ulterior motive?

Tue, Mar 20, 2012 KRL

Must be a campaign year... I have seen a lot of stupid, knee jerk reactions by Congress in my acquisition career but, this action will move to the top 10. Has anyone thought about what would happen if a suspended/debarred company is a true sole source or is the only company with the infrastructure and capability for supporting the mass support the military needs? It can take years to develop a second source for just about anything. This is why suspension/debarment is not already automatic....DUH!

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