Kara M. Sacilotto (firstname.lastname@example.org) is a partner in the Government Contracts Practice Group at Wiley Rein LLP. She is Chair-Elect of the American Bar Association Section of Public Contract Law and a member of the Section’s Debarment and Suspension Committee. The author thanks Mr. Rodney A. Grandon, the former Suspension and Debarring Official for the United States Air Force and now a monitor with Affiliated Monitors, Inc., and Duc H. Nguyen, the Suspension and Debarment Official for the Environmental Protection Agency and former Vice Chair of the ISDC, for their time, for sharing their views on the suspension and debarment system, and for their helpful comments on this article. The author also thanks the ABA Section of Public Contract Law’s Debarment and Suspension Committee for engaging on issues, including the exclusion of individuals, designed to improve the suspension and debarment system and promote engagement between industry, private practice, and government on issues affecting the suspension and debarment systems. The views expressed in this article are solely those of the author and should not be attributed to Wiley Rein LLP, the ABA Section of Public Contract Law, or any other entity.
The Federal Acquisition Regulation (FAR), applicable to procurement contracting, and the Non-Procurement Common Rule (NCR), applicable to non-procurement actions, both allow for the suspension, proposed debarment, or debarment from contracting or entering into non-procurement agreements with the United States if the individual or organization is found not “presently responsible.”1 Although the NCR is tailored more than the FAR in its consideration of individuals and corporate actors, both sets of rules are directed largely at and to corporate actors, not persons, such as company owners, executives, or employees.2 And, whereas the grounds for suspension and debarment are straightforward as applied to both a corporate entity and an individual, other aspects of the rules have little or no translation when applied to an individual.3 What, for example, does it mean for suspension or debarment to be in the “public interest” and “for the [g]overnment’s protection,” when applied to an individual person?4 Further, if a corporate entity is proposed for suspension or debarment, it can show that despite grounds for exclusion existing, various factors in FAR 9.406-1 or 2 C.F.R. 180.860, commonly referred to as mitigating factors, would suggest the entity nonetheless is presently responsible and exclusion is not required to protect the government.5 The FAR, in particular, directs mitigating factors at a corporate organization and provides, at best, rough guidance on how to assess whether an individual, despite cause for exclusion, nevertheless is presently responsible.6
Moreover, if the government does exclude a corporate entity from federal contracting, the FAR and NCR provide guidance on the activities the excluded entity cannot undertake (or, more accurately, that the government should not undertake with respect to the excluded entity).7 But, neither provides guidance on what restrictions, if any, should be placed on an individual’s interactions with the United States. The lack of guidance with respect to individuals is especially problematic because for many individuals who find themselves subject to a suspension and debarment action, the FAR’s process, particularly immediate exclusion if an individual or corporate entity is proposed for debarment,8 may present an immediate career (and livelihood) — ending event that is difficult to navigate. Although agency suspension and debarment officials (SDOs) may have informal patterns or practices to assess the present responsibility of individuals who come before them, neither the FAR nor the NCR provides adequate guidance to the individual facing potential exclusion.
Individuals are more vulnerable than corporations because, as a group, they tend to lack access to the resources available to companies, including both counsel and documents, necessary for their defense.9 Some individuals may not respond simply because they do not understand what facts or information might be relevant or the impact of finding oneself on an excluded party list.10 Others try to retain counsel, which may be wise (and affordable) for those in ownership and management positions, but may be cost-prohibitive for “rank-and-file” employees.11 Yet others, may try to “wing it,” without much insight into what matters to the assessment of their present responsibility.12 Still others may be so intimidated that they fail to answer at all.13
Compounding the difficulty of applying the FAR and NCR to individuals, other regulatory events have made individuals more likely to face the administrative penalties of suspension and debarment.14 In light of these separate regulatory events and the increase in suspension and debarment of individuals, it is time to consider changes to the FAR and NCR to better address the unique circumstances a private person faces when considered for exclusion. Indeed, several practitioners have addressed the “disconnect” in the current regulations as applied to individuals.15