DHS officials reluctant to debar, suspend contractors, IG reports

In 23 cases of failed contracts, no reviews for debarment or suspension were performed, according to IG Richard Skinner

Homeland Security Department contracting officials are reluctant to pursue suspension and debarment actions against contractors even when those actions may be warranted, according to a new audit released today by DHS Inspector General Richard Skinner.

DHS initiated 10 debarment cases and one suspension case from October 2003 to September 2008. The debarments related to violations of immigration laws, fraud and business integrity rules.

However, department officials are not aggressively pursuing debarments, Skinner wrote. The IG identified 23 cases in which a contract was terminated for default or cause, but the contract was not subsequently reviewed to see whether a debarment or suspension was appropriate.

“The Department of Homeland Security has suspension and debarment policies and procedures in place. However, the department is reluctant to apply the policies and procedures against poorly performing contractors,” Skinner wrote.

"Department procurement officials characterized the suspension and debarment process as being too resource-intensive, punitive and as negatively impacting the size of the contractor pool. The procurement officials prefer to use other administrative remedies to address poor contractor performance,” the report stated.

But reluctance to pursue suspension and debarment actions could put the government at risk of doing business with poor contractors, Skinner warned.

In addition, DHS officials are making no written record of their findings and evidence when they terminate contracts in default. In 21 cases where contracts were canceled for default, the reasons were not recorded in government-wide databases, Skinner wrote.

Even though the Federal Acquisition Regulation does not require that agencies document the reasons for such terminations, Skinner said it is in the government’s best interests to provide detailed rationales to reduce the risks of additional contract failures.

The IG recommended that DHS develop policies to ensure that contracts that are terminated for cause are evaluated for possible suspension or debarment actions as well as policies to record all pertinent information on contractor performance.

DHS officials agreed with the recommendations and have taken steps to improve their policies and procedures on suspension and debarment, the report concluded.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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