House Delays Proposed Blacklisting Rules

National Defense, October 2000 | Go to article overview
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House Delays Proposed Blacklisting Rules

The House of Representatives recently passed an amendment to the fiscal year 2001 Treasury and Postal Service Appropriations bill (H.R. 4871), which delays implementation of recently issued contractor/labor relations (blacklisting) proposed regulations.

The regulations would allow government contracting officers to disqualify any employer from receiving a federal contract if there is "relevant credible information" that the employer does not have "satisfactory compliance with federal laws including tax laws, labor and employment laws, environmental laws, antitrust laws, and consumer protection laws." (See 65 Fed. Reg. 40833, June 30, 2000).

The new standards upon which the decision of whether an employer does, or does not, qualify for a contract are seen by many as ambiguous. Those opposed to the regulations reason that even the best-intentioned employer can get caught in the vast maze of confusing and complicated federal rules and regulations implementing these major laws, and even innocent violations under review could be used to disqualify an employer.

Recent testimony before Congress by procurement experts have made the case that adequate protections already exist to protect the integrity of the procurement process and to ensure that taxpayers receive the best bargain for their money. Companies of all sizes would be impacted by these regulations, and both employers and employees of those employers would suffer if contracts were denied based on completely arbitrary reasons.

A bipartisan coalition led by Reps. Tom Davis, R-Va., and Jim Moran, D-Va., offered the amendment, which places a moratorium on the regulations. The amendment passed by a 228-190 vote.

Sen. Tim Hutchinson, R-Ark., introduced a bill to deal differently with this issue. The legislation, introduced in July, strictly limits the issuance of regulations relating to federal contractor responsibility, and requires the comptroller general to conduct a review of federal contractor compliance with applicable laws. Hutchinson's legislation, S. 2986, has been referred to the Senate Government Affairs Committee for consideration. The bill is expected to be taken up by the Senate before the end of the fiscal year.

BRAC Update

A new Government Accounting Office (GAO) report sheds new light on military base realignment and closure (BRAC) accounts.

The report blames slow budget execution from previous years for causing a buildup of more than $1.5 billion in unliquidated BRAC obligations from prior appropriations. At least $115 million was appropriated to the BRAC account in 1995, or earlier. The GAO report recommends that the Defense Department conduct reviews on these accounts, close out completed contracts, and consider the availability of remaining funds when formulating new budget requests.

The report also suggests that that Congress consider the need for timely obligation of funds, and the dispensation of funds where appropriate. This year, the Clinton administration has proposed $1.17 billion for BRAC accounts in its fiscal 2001 budget request. BRAC is a controversial budgetary item, as it is viewed as causing social and economic turmoil in the areas around the bases that close. There were four BRAC rounds between 1988 and 1995.

U.S. Tax Code

The House Ways and Means Committee has passed legislation that will bring the U.

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House Delays Proposed Blacklisting Rules


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