Firms say 'blacklisting' regs still onerous
- By Diane Frank
- Dec 03, 2000
Companies seeking federal contracts are cautiously — and unhappily — awaiting
word on a change to contracting regulations they say could lead to protests
The change to the Federal Acquisition Regulation would lay out stiffer
ground rules for a vendor's business ethics when agency contracting officers
are determining awards. Vendor concerns have resulted in several changes
since the rule was proposed in July 1999, including a more specific definition
of what makes up a "satisfactory record of integrity and business ethics."
But vendors are no happier with the revised version of what they are
calling the "blacklisting regulations." The final rule is due for release
before the end of the month, but some industry leaders said they would not
be surprised if the proposal is weakened with the exit of the Clinton administration.
"Rumor has it that there could be some delayed implementation of this...and
[the Republicans] don't like it at all," said Larry Allen, executive director
of the Coalition for Government Procurement, an organization of more than
300 federal contractors.
Industry officials say the rule poses several problems for vendors and
agencies. In an August letter to the FAR secretariat, the Technology Coalition
for Responsible Procurement (TechCorp) said new commercial vendors might
steer clear of the federal market over the fear of losing business because
of ethics accusations.
TechCorp — whose members include organizations such as the Information
Technology Association of America and the Professional Services Council — supports bills proposed by House and Senate GOP members that would require
the General Accounting Office to study the rule's impact before it goes
One fear is that the rule could slow the contracting process to a point
where all the positive impact of procurement reform is negated, said Olga
Grkavac, executive vice president of ITAA's Enterprise Solutions Division.
"To give contracting officers this extra responsibility when they are
so over-burdened is ridiculous," she said. "It's such an onerous way to
get at the few companies that may have fallen through the cracks."
But the point of procurement reform is to help the government function
more like the commercial sector, "and there is no one in the private sector
that has to do business with someone they don't trust, but the federal government
does," said Joshua Gotbaum, executive associate director of the Office of
Management and Budget.
According to OMB, the proposed rule simply clarifies requirements already
in place. The FAR already requires contracting officers to consider business
ethics and integrity, but "because there is literally no guidance on what
that means, contracting officers don't feel free to exercise their judgment,"
The proposed rule has been changed to say contracting officers should
look only at cases where the company was found to have violated the law,
not complaints brought against the company, Gotbaum said. But anything the
FAR council releases will be open to protest and legal challenges, Allen