Federal Register: November 15, 2006 (Volume 71, Number 220)
DOCID: FR Doc E6-19199
OFFICE OF MANAGEMENT AND BUDGET
Management and Budget Office
CFR Citation: 2 CFR Part 180
NOTICE: RULES
ACTION: Grants, other financial assistance, and nonprocurement agreements; governmentwide guidance:
DOCUMENT ACTION: Final rule.
SUBJECT CATEGORY:
Guidance for Governmentwide Debarment and Suspension (Nonprocurement)
DATES: The effective date for this final guidance is November 15, 2006.
DOCUMENT SUMMARY:
OMB is revising its Governmentwide guidance on nonprocurement debarment and suspension and issuing it in final form. The guidance, as implemented by Federal agency regulations, will replace the current common rule as the source of uniform agency policies and procedures related to nonprocurement debarment and suspension. Replacing the common rule with the guidance will reduce the volume of Federal regulations in this area and make them simpler to use.
SUMMARY:
Governmentwide debarment and suspension (nonprocurement); Federal agency guidance,
SUPPLEMENTAL INFORMATION
I. Background
OMB published interim final guidance on nonprocurement debarment and suspension in the Federal Register on August 31, 2005 [70 FR 51863]. The issuance of the OMB guidance is an important step toward replacing the current common rule on nonprocurement debarment and suspension, a regulation that 34 agencies individually publish.
Replacing the common rule will achieve significant regulatory streamlining and simplification. In lieu of its codification of the common rule, each agency will adopt the OMB guidance in a brief regulation that states any agencyspecific additions, exceptions, or clarifications to the Governmentwide policies and procedures. The OMB guidance and the individual agencies' brief adopting parts will replace the 34 agency codifications of the full text of the common rule. That replacement removes more than 1500 pages of needlessly duplicative regulations from the Code of Federal Regulations (CFR). The brief adopting parts also make it easy for a reader to see an agency's variations from the Governmentwide guidance. The variations previously were difficult to identify because they were embedded within each agency's publication of the full text of the common rule.
The August 2005 Federal Register notice stated that the substantive content of the interim final guidelines was intended to conform with the substance of the Federal agencies' most recent update to the common rule [68 FR 66534, November 26, 2003]. The notice therefore requested comments specifically on any unintended changes from the common rule. OMB received comments only from the Interagency Suspension and Debarment Committee (ISDC), pointing out a few unintended changes and needed technical corrections. These final guidelines make the needed revisions.
II. Comments and Changes to the Interim Final Guidance
The following paragraphs detail the substantive comments OMB received from the ISDC and the revisions made to the interim final guidance in making it the final guidance:
Comment: The ISDC recommended adding a new paragraph Sec. 180.25(c)(7) to state that an agency may include ``any provisions authorized by OMB'' in its regulation implementing the guidelines, in addition to the specific examples described in Sec. 180.25(c)(1) through (6). The added paragraph simply makes explicit the authority that OMB already has to approve additional provisions in an agency's regulation. The ISDC recommended the paragraph due to a concern that, without an explicit statement in Sec. 180.25(c)(7), an agency's regulatory provision that was beyond the scope of the six examples in Sec. 180.25(c)(1) through (6) could invite a legal challenge, even if approved by OMB.
Response: The guidelines were amended to add the recommended new subparagraph Sec. 180.25(c)(7).
Comment: The ISDC noted a technical error in the wording of Sec. 180.220(c)(1) that made an unintentional change from the common rule by reducing the number of additional tiers of contracts under a covered nonprocurement transaction that a Federal agency could include as covered transactions under the policy.
Response: The wording of Sec. 180.220(c)(1) was changed in accordance with the recommendation.
Comment: The ISDC recommended deleting Sec. 180.25(b)(4) and revising Sec. 180.300(b) by striking the phrase ``if allowed by the Federal agency responsible for the transaction * * *.'' The two changes remove the option for a Federal agency to preclude a primary tier participant from collecting certifications from a lower tier participant as the method it uses to help enforce lower tier participant compliance with the requirements of the policy. The ISDC recommended dropping the option because no Federal agency used it in adopting the common rule on nonprocurement suspension and debarment in November 2003.
Response: Section 180.25(b)(4) was deleted and Sec. 180.300(b) was revised, as recommended.
OMB made one additional technical correction in Sec. 180.220 in specifying which contracts and subcontracts under covered
nonprocurement transactions were to be considered ``covered
transactions.'' Under the interim final guidelines Sec. 180.220(b)(1)
included a contract in an amount ``expected to equal or exceed
$25,000'', while Sec. 180.220(c)(2) included a subcontract with a
value that ``exceeds or is expected to exceed $25,000.'' The dollar
thresholds in the two paragraphs were intended to be the same. OMB
therefore revised the wording of Sec. 180.220(c)(2) to conform with that in Sec. 180.220(b)(1).
III. How To Cite Agency Adopted Suspension and Debarment Guidelines
OMB understands there may be some confusion among practitioners
regarding citation of the guidelines when adopted by agencies. OMB
recommends the following long form citation to practitioners: [[Page 66432]]
2 CFR 180.630 ([Year when the section goes final]) as implemented by 2 CFR 2424.10 ([Year when section goes final]).
In the proposed citation, 180.630 refers to the OMB guideline in subtitle A, while 2424.10 refers to the specific agency enactment in subtitle B giving the guideline regulatory effect. Long forms for citations involving only Agencyspecific sections or both Adopted Guideline and Agencyspecific sections should follow standard citation formats based upon the above long form.
OMB further recommends that short forms following the initial
citation be solely to the guideline or the specific agency dropin
cited. The reference to CFR title in the short forms below would be dropped if it were to be repeated constantly.
2 CFR 180.630 by 2 CFR 2424.10
[Where the guideline contains all relevant material.]
2 CFR 2424.137
[Where the agency dropin contains all relevant material.]
2 CFR 180.995, 2424.995
[Where both the guideline and agency dropin are necessary.] IV. Next Step
The next step in replacing the current common rule on nonprocurement debarment and suspension is the agencies' issuance of regulations adopting the final OMB guidelines, as Sec. 180.30 of the guidelines requires. Over the coming months, each agency will publish a regulation in a new agency chapter in Subtitle B of 2 CFR, the new Governmentwide title that OMB established for grants and agreements. Each agency also will remove its codification of the common rule from its own CFR title so that the OMB guidance and all agency implementing regulations on nonprocurement debarment and suspension ultimately will be located in 2 CFR.
Availability of Amended 2 CFR Part 180
OMB has prepared an updated version of 2 CFR part 180 as amended
herein. It is available electronically on the OMB Home Page at http://www.omb.gov , and then select ``Grants Management'' followed by
``Circulars.''
List of Subjects in 2 CFR Part 180
Administrative practice and procedure, Debarment and suspension, Grant programs, Reporting and recordkeeping requirements.
Rob Portman,
Director.
Authority and Issuance
For the reasons set forth above, the Office of Management and Budget
amends 2 CFR part 180 in Subtitle A, Chapter I, as set forth below.
PART 180OMB GUIDELINES TO AGENCIES ON GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT)
1. The authority citation for part 180 continues to read as follows:
Authority: Sec. 2455, Pub. L. 103355, 108 Stat. 3327; E.O.
12549, 3 CFR, 1986 Comp., p. 189; E.O. 12689, 3 CFR, 1989 Comp., p. 235.
Sec. 180.25 [Amended]
2. Remove Sec. 180.25(b)(4) and redesignate Sec. 180.25(b)(5) as Sec. 180.25(b)(4).
3. Revise Sec. 180.25(c)(2) and add (c)(7) to read as follows:
Sec. 180.25 What must a Federal agency address in its implementation of the guidance?
* * * * *
(c) * * *
(2) Identify any types of nonprocurement transactions that the
Federal agency exempts from coverage under these guidelines, as authorized under Sec. 180.215(g)(2).
* * * * *
(7) Include any provisions authorized by OMB.
4. Revise Sec. 180.220(c)(1) and (c)(2) to read as follows:
Sec. 180.220 Are any procurement contracts included as covered transactions?
* * * * *
(c) * * *
(1) It is awarded by a participant in a procurement transaction
under a nonprocurement transaction of a Federal agency that extends the
coverage of paragraph (b)(1) of this section to additional tiers of
contracts (see the diagram in the appendix to this part showing that optional lower tier coverage); and
(2) The value of the subcontract is expected to equal or exceed $25,000.
5. Revise Sec. 180.300(b) to read as follows:
Sec. 180.300 What must I do before I enter into a covered transaction with another person at the next lower tier?
* * * * *
(b) Collecting a certification from that person; or
* * * * *
[FR Doc. E619199 Filed 111406; 8:45 am]
BILLING CODE 311001P
FOR FURTHER INFORMATION CONTACT
Gilbert Tran, Office of Federal
Financial Management, Office of Management and Budget, telephone (202)
3953052 (direct) or (202) 3953993 (main office) and email:
Hai_M._Tran@omb.eop.gov.