September 22, 2019

September 20, 2019

Subscribe to Latest Legal News and Analysis

September 19, 2019

Subscribe to Latest Legal News and Analysis

Interagency Suspension and Debarment Committee Reports “Plateauing” in Suspension and Debarment Activity

Each year, the Interagency Suspension and Debarment Committee (ISDC) reports to Congress on the status of the Federal suspension and debarment system. With its mission of assisting agencies to build and maintain efficient and effective suspension and debarment activities, the ISDC is uniquely situated to provide comments and insight on the status of suspension and debarment practices generally. 

In its Fiscal Year 2015 report, the ISDC commented on an interesting trend in agency suspension and debarment proceedings.  Fiscal years 2010 through 2014 saw a steady trend of increased suspension and debarment activity—with actual suspensions and debarments increasing from 1,585 in FY 2010 to 2,938 in FY 2014.  The ISDC observed that “Data for FY 2015 . . . shows a plateauing of the number of suspension and debarment actions,” with suspensions and debarments remaining relatively static at 2,791.

The ISDC report describes two possible reasons for the slowdown in growth of suspension and debarment activity. First, the report expressly suggests that the plateau “may, at least in part, be indicative of programs becoming established throughout the Executive Branch and transitioning from start up into effective programs.”  This is almost certainly correct.  In 2011, the Government Accountability Office (GAO) made recommendations on how six agencies with few or no procurement-related suspension and debarment activities could improve their programs. In a May 2014 follow-up report, the GAO described how these agencies—which included the Departments of Commerce, Health and Human Services, Justice, State, Treasury, and the Federal Emergency Management Agency—had collectively increased their total number of suspension and debarment actions from 19 (in 2009) to 271 (in 2013) by addressing staffing shortages, establishing formal policies, and actively encouraging referrals. Thus, it follows that the establishment and maturation of suspension and debarment programs which did not previously exist would generate a plateau of activity following an initial period of substantial growth.

A second possible cause of plateauing suspension and debarment activity is increased agency use of alternatives to suspension and debarment.  The ISDC emphasized its continued work to highlight “the full spectrum of tools available to an agency’s suspension and debarment program, ranging from pre-notice engagement, use of administrative agreements, and impositions of exclusions.”  These efforts appear to have generated results, as “agencies reported a nearly 30 percent increase from FY 2014 to FY 2015 in the use of show cause or other pre-notice investigative letters,” as well as a 25 percent increase in the use of administrative agreements over the same period.

While the flattening trend of suspension and debarment activity is illuminating by itself, the corresponding increase in agency use of suspension and debarment alternatives highlights avenues by which some contractors might be able to engage government agencies to avoid complete exclusion from government contract markets.  According to the ISDC, there were “over 50 instances during the reporting period where federal contractors or recipients proactively reached out to agency suspension and debarment offices to discuss potential issues, rather than waiting for the agency to take action.” As the ISDC report suggests agencies are more open to utilizing suspension and debarment alternatives, contractors might consider proactive agency engagement as a strategy for addressing potential suspension and debarment issues.

© 2019 Covington & Burling LLP

TRENDING LEGAL ANALYSIS


About this Author

E. Sanderson Hoe, Covington Burling, Contracts Lawyer, Negotiations Attorney
Senior Of Counsel

Sandy Hoe has practiced government contracts law for more than 40 years.  His expertise includes issues of contract formation, negotiation of subcontracts, bid protests, the structuring of complex private financing of government contracts, preparation of complex claims, and the resolution of post-award contract disputes through litigation or alternative dispute resolution.  His clients include major companies in the defense, telecommunications, information technology, financial, construction, and health care industries.

202-662-5394
Peter Barton Hutt, Food and Drug Attorney, Covington Law Firm
Special Counsel

Peter Barton Hutt is a senior counsel in the Washington, DC law firm of Covington & Burling, specializing in Food and Drug Law.  He began his law practice with the firm in 1960 and, except for his four years in the government, has continued at the firm ever since.  From 1971 to 1975 he was Chief Counsel for the Food and Drug Administration.

Mr. Hutt has represented the national trade associations for the food, prescription drug, nonprescription drug, dietary supplement, and cosmetic industries.  While at FDA he drafted the legislation that became the Medical Device Amendments of 1976, and beginning in 1962 he has participated in the drafting of most of the major legislation amending the Federal Food, Drug, and Cosmetic Act.  He has testified before the House and Senate more than 100 times either as a witness or as counsel accompanying a witness.

202-662-5522
Frederick Benson, Covington Burling, Litigation attorney
Associate

Fred Benson is an associate in the Washington, DC office. He is a member of the Government Contracts and White Collar Defense & Investigations practice groups.

Prior to joining the firm, Mr. Benson clerked for the Honorable Diarmuid F. O’Scannlain of the United States Court of Appeals for the Ninth Circuit.

1 202 662 5516