Suspension and Debarment: The Latest from the Interagency Committee

On June 15, 2016, the Interagency Suspension and Debarment Committee (ISDC) released its annual report to Congress.¹ As required by law, this report describes government-wide progress in improving the suspension and debarment process and provides a summary of each agency's suspension and debarment activities from Fiscal Year (FY) 2015.

THE NUMBERS

The number of suspensions, debarments, and proposed debarments had been steadily growing from FY 2009 through 2014. The ISDC’s Annual Report for 2015 shows a “plateauing” in these numbers as agency programs have become increasingly developed and mature. There were fewer suspensions, debarments, and proposed debarments in many agencies known for active programs. Some of the most dramatic examples of the decline in official actions were seen in certain Department of Defense agencies and in the Environmental Protection Agency:

• The Navy had 41 suspensions in FY 2015 compared to 145 in FY 2014; it had 155 proposed debarments in 2015 compared to 262 in FY 2014; and it had 154 debarments in FY 2015 compared to 208 in FY 2014.
• The Air Force had 18 suspensions in FY 2015, down from 109 in FY 2014; it had 123 proposed debarments in FY 2015, down from 177 the year before; and it had 100 debarments in FY 2015, down from 138 in FY 2014.
• The Environmental Protection Agency had 88 suspensions in FY 2015, down from 119 the previous year; it had 137 proposed debarments, down from 176 in FY 2014; and it had only 89 debarments in FY 2015, down from 148 the prior year.

But, despite an overall trend of decreased official actions, some civilian agencies were actually more active in 2015. For instance, the General Services Administration had seven times more suspensions in FY 2015 as in the year prior, and the Small Business Administration saw a three-fold increase in suspensions in FY 2015 compared to FY 2014.

THE ALTERNATIVES TO EXCLUSION

Importantly, the ISDC reported an increase in agencies' use of alternatives to suspension and debarment. In particular, as contractors become increasingly willing to raise issues proactively with agency suspension and debarment officials (SDOs) – rather than waiting to receive show cause letters – SDOs have demonstrated a willingness to respond by entering into administrative agreements, or otherwise resolving issues without recourse to suspension or debarment. According to the ISDC Report, in FY 2015 there were "over 50 instances in the reporting period of contractors proactively reaching out to agency SDOs," suggesting that many agencies are now tracking such proactive outreach by contractors. There has been a 30% increase in the use of "proactive engagement tools" such as pre-notice administrative agreements, indicating that SDOs are receptive to the idea of alternative and less drastic measures.

In this regard, the ISDC reminded Congress that the purpose of suspension and debarment is to protect the government, and not to punish contractors for past misconduct. The ISDC reported that it intends to remain focused on providing training for agencies as they continue to develop their programs, with particular emphasis on initiatives that promote transparency of process and consistency of practices and procedures across agencies.

Contractors should remain aware of the landscape. As the suspension and debarment functions of the various executive branch agencies has improved, many agencies have demonstrated that they are capable and willing to impose exclusion. This makes it all the more important for contractors to consider a strategy of early engagement with the relevant SDO(s) when a potential problem is identified.