Small Business Administration Implementation of OMB Guidance on Nonprocurement Debarment and Suspension, 39727-39730 [E7-14035]
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39727
Rules and Regulations
Federal Register
Vol. 72, No. 139
Friday, July 20, 2007
This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents. Prices of
new books are listed in the first FEDERAL
REGISTER issue of each week.
SMALL BUSINESS ADMINISTRATION
2 CFR Part 2700
13 CFR Parts 134 and 145
RIN 3245–AF63
Small Business Administration
Implementation of OMB Guidance on
Nonprocurement Debarment and
Suspension
U.S. Small Business
Administration.
ACTION: Direct final rule.
ebenthall on PRODPC61 with RULES
AGENCY:
SUMMARY: The U.S. Small Business
Administration (SBA) is moving its
regulations on nonprocurement
debarment and suspension from their
current location in title 13 of the Code
of Federal Regulations (CFR) to title 2 of
the CFR, and is adopting the format
established by the Office of Management
and Budget (OMB). This rule establishes
a new 2 CFR part 2700 that adopts
OMB’s final government-wide guidance
on nonprocurement debarment and
suspension and contains supplemental
SBA nonprocurement debarment and
suspension provisions. In addition, this
rule removes the existing SBA
nonprocurement debarment and
suspension regulations and makes a
conforming change and minor
procedural clarifications. These changes
constitute an administrative
simplification that makes no substantive
change in SBA policy or procedures for
nonprocurement debarment and
suspension. SBA is also amending a
provision in its Rules of Procedure
Governing Cases Before the Office of
Hearings and Appeals (13 CFR
134.102(p)) to update the reference to
SBA’s nonprocurement debarment and
suspension regulations.
DATES: Effective Date: This rule is
effective September 18, 2007 without
further action.
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FOR FURTHER INFORMATION CONTACT:
Kevin Harber, Office of General
Counsel, U.S. Small Business
Administration, 409 Third St., SW., Ste.
5700, Washington, DC 20416, telephone
202–619–1602 and e-mail:
Kevin.Harber@sba.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction
On May 11, 2004, OMB established
title 2 of the CFR with two subtitles (69
FR 2627). Subtitle A, ‘‘Governmentwide Grants and Agreements,’’ contains
OMB policy guidance to Federal
agencies on grants and agreements.
Subtitle B, ‘‘Federal Agency Regulations
for Grants and Agreements,’’ contains
Federal agencies’ regulations
implementing the OMB guidance, as it
applies to grants and other financial
assistance agreements and
nonprocurement transactions.
On August 31, 2005, OMB published
interim final guidance for governmentwide nonprocurement debarment and
suspension in the Federal Register (70
FR 51863). The guidance was located in
title 2 of the CFR as new subtitle A,
chapter 1, part 180. The interim final
guidance updated previous OMB
guidance that was issued pursuant to
Executive Order 12549, ‘‘Debarment and
Suspension’’ (February 18, 1986), which
gave government-wide effect to each
agency’s nonprocurement debarment
and suspension actions. Section 6 of the
Executive Order authorized OMB to
issue guidance to Executive agencies on
nonprocurement debarment and
suspension, including provisions
prescribing government-wide criteria
and minimum due process procedures.
Section 3 directed Executive agencies to
issue regulations implementing the
Executive Order that are consistent with
the OMB guidelines. The interim final
guidance at 2 CFR part 180 conforms the
OMB guidance with the Federal
agencies’ November 26, 2003, update to
the common rule on nonprocurement
debarment and suspension (see 70 FR
51864). Although substantively the
same as the common rule, OMB’s
interim final guidance was published in
a form suitable for agency adoption,
thus eliminating the need for each
agency to repeat the full text of the OMB
government-wide guidance in its
implementing regulations. This new
approach is intended to make it easier
for recipients of covered transactions or
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respondents in suspension or debarment
actions to discern agency-to-agency
variations from the common rule
language; reduce the volume of Federal
regulations in the CFR; and streamline
the process for updating the
government-wide requirements on
nonprocurement debarment and
suspension (70 FR 51864). On
November 15, 2006, OMB published a
final rule adopting the interim final
guidance with changes (71 FR 66431).
This direct final rule places SBA’s
nonprocurement debarment and
suspension regulations in subtitle B of
title 2 of the CFR, along with other
agencies’ nonprocurement debarment
and suspension rules. This action was
required by the OMB interim final
guidance, which was made final on
November 15, 2006 (see 2 CFR 180.20,
180.25, 180.30 and 180.35). The new
CFR part 2700 adopts the OMB
guidelines with additions and
clarifications that SBA made to the
common rule on nonprocurement
debarment and suspension in the SBA
rule published on November 26, 2003
(68 FR 66544–70). The substance of
SBA’s nonprocurement debarment and
suspension is unchanged. SBA is
removing 13 CFR part 145, which was
last revised as part of the November
2003 common rule.
SBA is not soliciting public comment
on this rule and is instead issuing this
rule as a direct final rule. Under 5
U.S.C. 553(b)(3)(A) agencies are not
required to undergo notice and
comment procedure for ‘‘interpretative
rules, general statements of policy, or
rules of agency organization, procedure,
or practice.’’ Because this rule adopts
OMB’s published guidelines, which
followed notice and comment
procedures, and collocates SBA’s
specific nonprocurement suspension
and debarment rules to title 2 of the
CFR, we believe that it falls under the
exception cited above.
Compliance With Executive Orders
13132, 12988 and 12866, the Regulatory
Flexibility Act (5 U.S.C. 601–602), and
the Paperwork Reduction Act (44 U.S.C.
Ch. 35)
This regulation will not have
substantial direct effects on the States,
on the relationship between the national
government and the States, or on the
distribution of power and
responsibilities among the various
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Federal Register / Vol. 72, No. 139 / Friday, July 20, 2007 / Rules and Regulations
levels of government. Therefore, for the
purposes of Executive Order 13132,
SBA determines that this rule has no
federalism implications warranting
preparation of a federalism assessment.
OMB has determined this rule is not
a ‘‘significant regulatory action’’ under
Executive Order 12866.
This action meets applicable
standards set forth in sections 3(a) and
3(b)(2) of Executive Order 12988, Civil
Justice Reform, to minimize litigation,
eliminate ambiguity, and reduce
burden. The action does not have
retroactive or preemptive effect.
SBA has determined that this rule
does not impose additional reporting or
recordkeeping requirements under the
Paperwork Reduction Act, 44 U.S.C.
Chapter 35.
The Regulatory Flexibility Act (RFA),
5 U.S.C. 601, requires administrative
agencies to consider the effect of their
actions on small entities, small nonprofit enterprises, and small local
governments. Pursuant to the RFA,
when an agency issues a rulemaking,
the agency must prepare a regulatory
flexibility analysis which describes the
impact of the rule on small entities.
However, section 605 of the RFA allows
an agency to certify a rule, in lieu of
preparing an analysis, if the rulemaking
is not expected to have a significant
economic impact on a substantial
number of small entities. Within the
meaning of the RFA, SBA certifies that
this rule will not have a significant
economic impact on a substantial
number of small entities because the
rule imposes no direct requirements on
small entities.
Title 2—Grants and Agreements
I 1. Add Chapter XXVII, consisting of
Part 2700 to Subtitle B to read as
follows:
List of Subjects
Subpart I—Definitions
2700.930 Debarring official
2700.995 Principal
2700.1010 Suspending official
2 CFR Part 2700
Administrative practice and
procedure, Debarment and suspension,
Grant programs, Reporting and
recordkeeping requirements.
Chapter XXVII—Small Business
Administration
§ 2700.20
PART 2700—NONPROCUREMENT
DEBARMENT AND SUSPENSION
Sec.
2700.10 What does this part do?
2700.20 Does this part apply to me?
2700.30 What policies and procedures must
I follow?
Subpart A—General
2700.137 Who in the Small Business
Administration may grant an exception
to let an excluded person participate in
a covered transaction?
Subpart B—Covered Transactions
2700.220 What contracts and subcontracts,
in addition to those listed in 2 CFR
180.220, are covered transactions?
Subpart C—Responsibilities of Participants
Regarding Transactions
2700.332 What methods must I use to pass
requirements down to participants at
lower tiers with whom I intend to do
business?
Subpart D—Responsibilities of Federal
Agency Officials Regarding Transactions
2700.437 What method do I use to
communicate to a participant the
requirements described in the OMB
guidance at 2 CFR 180.435?
Subpart E–F—[Reserved]
Subpart G—Suspension
2700.765 How may I appeal my
suspension?
Subpart H—Debarment
2700.890 How may I appeal my debarment?
Subpart J—[Reserved]
13 CFR Part 134
Administrative practice and
procedure, Claims, Equal access to
justice, Lawyers, Organizations and
functions (Government agencies).
§ 2700.10
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Administrative practice and
procedure, Government contracts, Grant
programs, Loan programs, Reporting
and recordkeeping requirements.
Accordingly, under the authority of 15
U.S.C. 634, SBA amends the Code of
Federal Regulations, Title 2, Subtitle B,
and Title 13, Chapter 1, as follows:
I
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What does this part do?
This part adopts the Office of
Management and Budget (OMB)
guidance in subparts A through I of 2
CFR part 180, as supplemented by this
part, as the SBA policies and procedures
for nonprocurement debarment and
suspension. It thereby gives regulatory
effect for SBA to the OMB guidance as
supplemented by this part. This part
satisfies the requirements in section 3 of
Executive Order 12549, ‘‘Debarment and
Suspension’’ (3 CFR 1986 Comp., p.
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Does this part apply to me?
This part and, through this part,
pertinent portions of the OMB guidance
in subparts A through I of 2 CFR part
180 (see table at 2 CFR 180.100(b))
apply to you if you are a—
(a) Participant or principal in a
‘‘covered transaction’’ (see subpart B of
2 CFR part 180 and the definition of
‘‘nonprocurement transaction’’ at 2 CFR
180.970);
(b) Respondent in an SBA suspension
or debarment action;
(c) SBA debarment or suspension
official; or
(d) SBA grants officer, agreements
officer, or other official authorized to
enter into any type of nonprocurement
transaction that is a covered transaction.
§ 2700.30 What policies and procedures
must I follow?
The SBA policies and procedures you
must follow are the policies and
procedures specified in each applicable
section of the OMB guidance in subparts
A through I of 2 CFR part 180, as that
section is supplemented by the section
in this part with the same section
number. The contracts that are covered
transactions, for example, are specified
by section 220 of the OMB guidance
(i.e., 2 CFR 180.220) as supplemented
by section 220 of this part (i.e.,
§ 2700.220). For any section of OMB
guidance in Subparts A through I of 2
CFR 180 that has no corresponding
section in this part, SBA policies and
procedures are those in the OMB
guidance.
Subpart A—General
Authority: Sec. 2455, Pub. L. 103–355, 108
Stat. 3327 (31 U.S.C. 6101 note); E.O. 12549
(3 CFR, 1986 Comp., p. 189); E.O. 12689 (3
CFR, 1989, 1986 Comp., p. 235); 15 U.S.C.
634(b)(6).
13 CFR Part 145
189); Executive Order 12689,
‘‘Debarment and Suspension’’ (3 CFR
1989 Comp., p. 235); and section 2455
of the Federal Acquisition Streamlining
Act of 1994, Pub. L. 103–355 (31 U.S.C.
6101 note).
§ 2700.137 Who in the Small Business
Administration may grant an exception to
let an excluded person participate in a
covered transaction?
The Director of the Office of Lender
Oversight may grant an exception
permitting an excluded person to
participate in a particular covered
transaction under SBA’s financial
assistance programs. For all other
Agency programs, the Director of the
Office of Business Operations may grant
such an exception.
Subpart B—Covered Transactions
§ 2700.220 What contracts and
subcontracts, in addition to those listed in
2 CFR 180.220, are covered transactions?
In addition to the contracts covered
under 2 CFR 180.22(b) of the OMB
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guidance, this part applies to any
contract, regardless of tier, that is
awarded by a contractor, subcontractor,
supplier, consultant, or its agent or
representative in any transaction, if the
contract is to be funded or provided by
the SBA under a covered
nonprocurement transaction and the
amount of the contract is expected to
equal or exceed $25,000. This extends
the coverage of the SBA
nonprocurement suspension and
debarment requirements to all lower
tiers of subcontracts under covered
nonprocurement transactions, as
permitted under the OMB guidance at 2
CFR 180.200(c) (see optional lower tier
coverage in the figure in the Appendix
to 2 CFR part 180)
Subpart C—Responsibilities of
Participants Regarding Transactions
§ 2700.332 What methods must I use to
pass requirements down to participants at
lower tiers with whom I intend to do
business?
You, as a participant, must include a
term or condition in lower-tier
transactions requiring lower-tier
participants to comply with subpart C of
the OMB guidance in 2 CFR part 180,
as supplemented by this part.
Subpart D—Responsibilities of Federal
Agency Officials Regarding
Transactions
Subpart H—Debarment
§ 2700.437 What method do I use to
communicate to a participant the
requirements described in the OMB
guidance at 2 CFR 180.435?
§ 2700.890 How may I appeal my
debarment?
To communicate to a participant the
requirements described in 2 CFR
180.435 of the OMB guidance, you must
include a term or condition in the
transaction that requires the
participant’s compliance with subpart C
of 2 CFR part 180, as supplemented by
subpart C of this part, and requires the
participant to include a similar term or
condition in lower-tier covered
transactions.
Subpart E–F—[Reserved]
Subpart G—Suspension
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§ 2700.765 How may I appeal my
suspension?
(a) If the SBA suspending official
issues a decision under § 180.755 to
continue your suspension after you
present information in opposition to
that suspension under § 180.720, you
may ask for review of the suspending
official’s decision in two ways:
(1) You may ask the suspending
official to reconsider the decision for
material errors of fact or law that you
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believe will change the outcome of the
matter; or
(2) You may request that the SBA
Office of Hearings and Appeals (OHA)
review the suspending official’s
decision to continue your suspension
within 30 days of your receipt of the
suspending official’s decision under
§ 180.755 or paragraph (a)(1) of this
section. However, OHA may reverse the
suspending official’s decision only
where OHA finds that the decision is
based on a clear error of material fact or
law, or where OHA finds that the
suspending official’s decision was
arbitrary, capricious, or an abuse of
discretion. You may appeal the
suspending official’s decision without
requesting reconsideration, or you may
appeal the decision of the suspending
official on reconsideration. The
procedures governing OHA appeals are
set forth in 13 CFR part 134.
(b) A request for review under this
section must be in writing; state the
specific findings you believe to be in
error; and include the reasons or legal
bases for your position.
(c) OHA, in its discretion, may stay
the suspension pending review of the
suspending official’s decision.
(d) The SBA suspending official and
OHA must notify you of their decision
under this section, in writing, using the
notice procedures set forth at §§ 180.615
and 180.975.
(a) If the SBA debarring official issues
a decision under § 180.870 to debar you
after you present information in
opposition to a proposed debarment
under § 180.815, you may ask for review
of the debarring official’s decision in
two ways:
(1) You may ask the debarring official
to reconsider the decision for material
errors of fact or law that you believe will
change the outcome of the matter; or
(2) You may request that the SBA
Office of Hearings and Appeals (OHA)
review the debarring official’s decision
to debar you within 30 days of your
receipt of the debarring official’s
decision under § 180.870 or paragraph
(a)(1) of this section. However, OHA
may reverse the debarring official’s
decision only where OHA finds that the
decision is based on a clear error of
material fact or law, or where OHA
finds that the debarring official’s
decision was arbitrary, capricious, or an
abuse of discretion. You may appeal the
debarring official’s decision without
requesting reconsideration, or you may
appeal the decision of the debarring
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39729
official on reconsideration. The
procedures governing OHA appeals are
set forth in 13 CFR part 134.
(b) A request for review under this
section must be in writing; state the
specific findings you believe to be in
error; and include the reasons or legal
bases for your position.
(c) OHA, in its discretion, may stay
the debarment pending review of the
debarring official’s decision.
(d) The SBA debarring official and
OHA must notify you of their decision
under this section, in writing, using the
notice procedures set forth at §§ 180.615
and 180.975.
Subpart I—Definitions
§ 2700.930 Debarring official (SBA
supplement to government-wide definition
at 2 CFR 180.930).
For SBA, the debarring official for
financial assistance programs is the
Director of the Office of Lender
Oversight; for all other programs, the
debarring official is the Director of the
Office of Business Operations.
§ 2700.995 Principal (SBA supplement to
government-wide definition at 2 CFR
180.995).
Principal means—
(a) Other examples of individuals who
are principals in SBA covered
transactions include:
(1) Principal investigators.
(2) Securities brokers and dealers
under the section 7(a) Loan, Certified
Development Company (CDC) and
Small Business Investment Company
(SBIC) programs.
(3) Applicant representatives under
the section 7(a) Loan, CDC, SBIC, Small
Business Development Center (SBDC),
and section 7(j) programs.
(4) Providers of professional services
under the section 7(a) Loan, CDC, SBIC,
SBDC, and section 7(j) programs.
(5) Individuals that certify,
authenticate or authorize billings.
(b) [Reserved]
§ 2700.1010 Suspending official (SBA
supplement to government-wide definition
at 2 CFR 180.1010).
For SBA, the suspending official for
financial assistance programs is the
Director of the Office of Lender
Oversight; for all other programs, the
suspending official is the Director of the
Office of Business Operations.
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Federal Register / Vol. 72, No. 139 / Friday, July 20, 2007 / Rules and Regulations
Subpart J—[Reserved]
Title XIII—Business Credit and
Assistance; Chapter I—Small Business
Administration
PART 134—RULES OF PROCEDURE
GOVERNING CASES BEFORE THE
OFFICE OF HEARINGS AND APPEALS
2. The authority citation for part 134
continues to read as follows:
I
Authority: 5 U.S.C. 504; 15 U.S.C. 632,
634(b)(6), 637(a), 648(l), 656(i), and 687(c);
E.O. 12549, 51 FR 6370, 3 CFR, 1986 Comp.,
p. 189.
§ 134.102
[Amended]
3. Section 134.102(p) of subpart B is
amended by removing ‘‘part 145 of this
chapter’’ and adding ‘‘2 CFR parts 180
and 2700’’ in its place.
I
PART 145—[REMOVED]
4. Under the authority of 15 U.S.C.
634, 13 CFR part 145 is removed.
I
Dated: July 12, 2007.
Steven C. Preston,
Administrator.
[FR Doc. E7–14035 Filed 7–19–07; 8:45 am]
BILLING CODE 8025–01–P
DEPARTMENT OF AGRICULTURE
Grain Inspection, Packers and
Stockyards Administration
7 CFR Parts 800 and 810
RIN 0580–AA91
United States Standards for Sorghum
Grain Inspection, Packers and
Stockyards Administration, USDA.
ACTION: Final rule.
ebenthall on PRODPC61 with RULES
AGENCY:
SUMMARY: We are revising the United
States Standards for Sorghum to amend
the definitions of the classes Sorghum,
White sorghum, and Tannin sorghum,
and to amend the definition of nongrain
sorghum. We are amending the grade
limits for broken kernels and foreign
material (BNFM), and the subfactor
foreign material (FM). Additionally, we
are inserting a total count limit for other
material into the standards and revising
the method of certifying test weight
(TW). Further, we are changing the
inspection plan tolerances for BNFM
and FM. These changes will help
facilitate the marketing of sorghum.
DATES: Effective Date: June 1, 2008.
FOR FURTHER INFORMATION CONTACT:
Patrick McCluskey at GIPSA, USDA,
Suite 180 STOP 1404, 6501 Beacon
Drive, Kansas City, MO, 64133;
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14:38 Jul 19, 2007
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Telephone (816) 823–4639; fax (816)
823–4644.
SUPPLEMENTARY INFORMATION:
Background
The United States Grain Standards
Act (USGSA) authorizes the Secretary of
Agriculture to establish official
standards of kind and class, quality and
condition for sorghum and other grains
(7 U.S.C. 76). The United States
Standards for Grain serve as the starting
point to define grain quality in the
marketplace. The United States
Standards for Sorghum are in the
regulations at 7 CFR 810.1401–
810.1405.
On September 24, 2003, GIPSA was
asked by the National Sorghum
Producers (NSP, formerly National
Grain Sorghum Producers) to initiate a
review of the sorghum standards.
Accordingly, in the December 17, 2003
Federal Register (68 FR 70201), through
an Advance Notice of Proposed
Rulemaking (ANPR) we requested views
and comments on the sorghum
standards. We received 35 comments to
the ANPR. In the March 29, 2006
Federal Register (71 FR 15633–15639)
we invited comments to our proposed
rule identifying changes to the United
States Standards for Sorghum to:
(1) Delete the reference to tannin
content from definitions of Sorghum,
Tannin sorghum and White sorghum,
and define these classes based on the
presence or absence of a pigmented testa
(subcoat);
(2) Revise the definition of nongrain
sorghum by deleting sorghumsudangrass hybrids, sorgrass, and
adding language referencing seeds of
Sorghum bicolor (L.) Moench that
appear atypical of grain sorghum;
(3) Reduce the grading limits for
broken kernels and foreign material
(BNFM) and the subfactor foreign
material (FM);
(4) Insert a total count limit of 10 for
other material used to determine sample
grade factors;
(5) Report the certification of sorghum
test weight in tenths of a pound per
bushel; and
(6) Revise the sorghum breakpoints
and associated grade limits for U.S. Nos.
1, 2, 3, and 4 BNFM and FM.
Comment Review
We received 11 comments expressing
a variety of views during the 60 day
comment period for the proposed rule.
We received comments from sorghum
producers, producer and other industry
organizations, grain handlers, and a
sorghum researcher.
Overall, the comments supported all
or a significant portion of the changes.
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A few commenters opposed specific
portions of the changes. Some
commenters requested additional
changes beyond the scope of the
proposed rule: Deleting the separate
reference to FM but retaining the
standard for total BNFM in the sorghum
standard; deleting the reference to other
grains from the definition of Damaged
Kernels and Heat-damaged Kernels; and
standardizing feed grain standards. We
will consider these comments for future
work on the standards.
Sorghum Class Definitions
We proposed removing the reference
to tannin content from definitions of
Sorghum, Tannin sorghum and White
sorghum, and define these classes based
on the presence or absence of a
pigmented testa (subcoat). We received
nine comments on the proposal to
remove the word tannin from the class
definitions of Sorghum, Tannin
sorghum, and White sorghum. Eight
commenters directly supported the
proposal as written and the other
commenter did not oppose the proposal
as written. No comments were received
opposing the proposal. Of the
supporting comments, most used
identical language to state that defining
sorghum based on the lack of a
pigmented testa (subcoat) addressed the
concerns of sorghum marketing
organizations. Accordingly, we are
amending the sorghum standards to
remove the reference to tannin content
from definitions of Sorghum, Tannin
sorghum and White sorghum, and
define these classes based on the
presence or absence of a pigmented testa
(subcoat), as set forth in the proposal.
Nongrain Sorghum Definition
We proposed changing the definition
of nongrain sorghum by (1) removing
sorgrass and sorghum-sudangrass
hybrids by (2) adding the words ‘‘seeds
of Sorghum bicolor (L.) Moench that
appear atypical of grain sorghum.’’ No
commenters opposed or supported the
proposal as written. Sorghumsudangrass hybrids (botanically,
Sorghum bicolor (L.) Moench), despite
being grown as a forage crop, can either
produce kernels which appear typical of
grain sorghum or kernels that appear
atypical of grain sorghum. We continue
to believe that there is no reason to
count kernels which appear typical of
grain sorghum as nongrain sorghum,
and this proposed change is made final
herein.
Comments were received supporting
the removal of sweet sorghum (sorgo)
from the definition of nongrain sorghum
because botanically, sweet sorghum is
Sorghum bicolor (l.) Moench, as is grain
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]]>Agencies
[Federal Register Volume 72, Number 139 (Friday, July 20, 2007)]
[Rules and Regulations]
[Pages 39727-39730]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-14035]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
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========================================================================
Federal Register / Vol. 72, No. 139 / Friday, July 20, 2007 / Rules
and Regulations
[[Page 39727]]
SMALL BUSINESS ADMINISTRATION
2 CFR Part 2700
13 CFR Parts 134 and 145
RIN 3245-AF63
Small Business Administration Implementation of OMB Guidance on
Nonprocurement Debarment and Suspension
AGENCY: U.S. Small Business Administration.
ACTION: Direct final rule.
-----------------------------------------------------------------------
SUMMARY: The U.S. Small Business Administration (SBA) is moving its
regulations on nonprocurement debarment and suspension from their
current location in title 13 of the Code of Federal Regulations (CFR)
to title 2 of the CFR, and is adopting the format established by the
Office of Management and Budget (OMB). This rule establishes a new 2
CFR part 2700 that adopts OMB's final government-wide guidance on
nonprocurement debarment and suspension and contains supplemental SBA
nonprocurement debarment and suspension provisions. In addition, this
rule removes the existing SBA nonprocurement debarment and suspension
regulations and makes a conforming change and minor procedural
clarifications. These changes constitute an administrative
simplification that makes no substantive change in SBA policy or
procedures for nonprocurement debarment and suspension. SBA is also
amending a provision in its Rules of Procedure Governing Cases Before
the Office of Hearings and Appeals (13 CFR 134.102(p)) to update the
reference to SBA's nonprocurement debarment and suspension regulations.
DATES: Effective Date: This rule is effective September 18, 2007
without further action.
FOR FURTHER INFORMATION CONTACT: Kevin Harber, Office of General
Counsel, U.S. Small Business Administration, 409 Third St., SW., Ste.
5700, Washington, DC 20416, telephone 202-619-1602 and e-mail:
Kevin.Harber@sba.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction
On May 11, 2004, OMB established title 2 of the CFR with two
subtitles (69 FR 2627). Subtitle A, ``Government-wide Grants and
Agreements,'' contains OMB policy guidance to Federal agencies on
grants and agreements. Subtitle B, ``Federal Agency Regulations for
Grants and Agreements,'' contains Federal agencies' regulations
implementing the OMB guidance, as it applies to grants and other
financial assistance agreements and nonprocurement transactions.
On August 31, 2005, OMB published interim final guidance for
government-wide nonprocurement debarment and suspension in the Federal
Register (70 FR 51863). The guidance was located in title 2 of the CFR
as new subtitle A, chapter 1, part 180. The interim final guidance
updated previous OMB guidance that was issued pursuant to Executive
Order 12549, ``Debarment and Suspension'' (February 18, 1986), which
gave government-wide effect to each agency's nonprocurement debarment
and suspension actions. Section 6 of the Executive Order authorized OMB
to issue guidance to Executive agencies on nonprocurement debarment and
suspension, including provisions prescribing government-wide criteria
and minimum due process procedures. Section 3 directed Executive
agencies to issue regulations implementing the Executive Order that are
consistent with the OMB guidelines. The interim final guidance at 2 CFR
part 180 conforms the OMB guidance with the Federal agencies' November
26, 2003, update to the common rule on nonprocurement debarment and
suspension (see 70 FR 51864). Although substantively the same as the
common rule, OMB's interim final guidance was published in a form
suitable for agency adoption, thus eliminating the need for each agency
to repeat the full text of the OMB government-wide guidance in its
implementing regulations. This new approach is intended to make it
easier for recipients of covered transactions or respondents in
suspension or debarment actions to discern agency-to-agency variations
from the common rule language; reduce the volume of Federal regulations
in the CFR; and streamline the process for updating the government-wide
requirements on nonprocurement debarment and suspension (70 FR 51864).
On November 15, 2006, OMB published a final rule adopting the interim
final guidance with changes (71 FR 66431).
This direct final rule places SBA's nonprocurement debarment and
suspension regulations in subtitle B of title 2 of the CFR, along with
other agencies' nonprocurement debarment and suspension rules. This
action was required by the OMB interim final guidance, which was made
final on November 15, 2006 (see 2 CFR 180.20, 180.25, 180.30 and
180.35). The new CFR part 2700 adopts the OMB guidelines with additions
and clarifications that SBA made to the common rule on nonprocurement
debarment and suspension in the SBA rule published on November 26, 2003
(68 FR 66544-70). The substance of SBA's nonprocurement debarment and
suspension is unchanged. SBA is removing 13 CFR part 145, which was
last revised as part of the November 2003 common rule.
SBA is not soliciting public comment on this rule and is instead
issuing this rule as a direct final rule. Under 5 U.S.C. 553(b)(3)(A)
agencies are not required to undergo notice and comment procedure for
``interpretative rules, general statements of policy, or rules of
agency organization, procedure, or practice.'' Because this rule adopts
OMB's published guidelines, which followed notice and comment
procedures, and collocates SBA's specific nonprocurement suspension and
debarment rules to title 2 of the CFR, we believe that it falls under
the exception cited above.
Compliance With Executive Orders 13132, 12988 and 12866, the Regulatory
Flexibility Act (5 U.S.C. 601-602), and the Paperwork Reduction Act (44
U.S.C. Ch. 35)
This regulation will not have substantial direct effects on the
States, on the relationship between the national government and the
States, or on the distribution of power and responsibilities among the
various
[[Page 39728]]
levels of government. Therefore, for the purposes of Executive Order
13132, SBA determines that this rule has no federalism implications
warranting preparation of a federalism assessment.
OMB has determined this rule is not a ``significant regulatory
action'' under Executive Order 12866.
This action meets applicable standards set forth in sections 3(a)
and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize
litigation, eliminate ambiguity, and reduce burden. The action does not
have retroactive or preemptive effect.
SBA has determined that this rule does not impose additional
reporting or recordkeeping requirements under the Paperwork Reduction
Act, 44 U.S.C. Chapter 35.
The Regulatory Flexibility Act (RFA), 5 U.S.C. 601, requires
administrative agencies to consider the effect of their actions on
small entities, small non-profit enterprises, and small local
governments. Pursuant to the RFA, when an agency issues a rulemaking,
the agency must prepare a regulatory flexibility analysis which
describes the impact of the rule on small entities. However, section
605 of the RFA allows an agency to certify a rule, in lieu of preparing
an analysis, if the rulemaking is not expected to have a significant
economic impact on a substantial number of small entities. Within the
meaning of the RFA, SBA certifies that this rule will not have a
significant economic impact on a substantial number of small entities
because the rule imposes no direct requirements on small entities.
List of Subjects
2 CFR Part 2700
Administrative practice and procedure, Debarment and suspension,
Grant programs, Reporting and recordkeeping requirements.
13 CFR Part 134
Administrative practice and procedure, Claims, Equal access to
justice, Lawyers, Organizations and functions (Government agencies).
13 CFR Part 145
Administrative practice and procedure, Government contracts, Grant
programs, Loan programs, Reporting and recordkeeping requirements.
0
Accordingly, under the authority of 15 U.S.C. 634, SBA amends the Code
of Federal Regulations, Title 2, Subtitle B, and Title 13, Chapter 1,
as follows:
Title 2--Grants and Agreements
0
1. Add Chapter XXVII, consisting of Part 2700 to Subtitle B to read as
follows:
Chapter XXVII--Small Business Administration
PART 2700--NONPROCUREMENT DEBARMENT AND SUSPENSION
Sec.
2700.10 What does this part do?
2700.20 Does this part apply to me?
2700.30 What policies and procedures must I follow?
Subpart A--General
2700.137 Who in the Small Business Administration may grant an
exception to let an excluded person participate in a covered
transaction?
Subpart B--Covered Transactions
2700.220 What contracts and subcontracts, in addition to those
listed in 2 CFR 180.220, are covered transactions?
Subpart C--Responsibilities of Participants Regarding Transactions
2700.332 What methods must I use to pass requirements down to
participants at lower tiers with whom I intend to do business?
Subpart D--Responsibilities of Federal Agency Officials Regarding
Transactions
2700.437 What method do I use to communicate to a participant the
requirements described in the OMB guidance at 2 CFR 180.435?
Subpart E-F--[Reserved]
Subpart G--Suspension
2700.765 How may I appeal my suspension?
Subpart H--Debarment
2700.890 How may I appeal my debarment?
Subpart I--Definitions
2700.930 Debarring official
2700.995 Principal
2700.1010 Suspending official
Subpart J--[Reserved]
Authority: Sec. 2455, Pub. L. 103-355, 108 Stat. 3327 (31 U.S.C.
6101 note); E.O. 12549 (3 CFR, 1986 Comp., p. 189); E.O. 12689 (3
CFR, 1989, 1986 Comp., p. 235); 15 U.S.C. 634(b)(6).
Sec. 2700.10 What does this part do?
This part adopts the Office of Management and Budget (OMB) guidance
in subparts A through I of 2 CFR part 180, as supplemented by this
part, as the SBA policies and procedures for nonprocurement debarment
and suspension. It thereby gives regulatory effect for SBA to the OMB
guidance as supplemented by this part. This part satisfies the
requirements in section 3 of Executive Order 12549, ``Debarment and
Suspension'' (3 CFR 1986 Comp., p. 189); Executive Order 12689,
``Debarment and Suspension'' (3 CFR 1989 Comp., p. 235); and section
2455 of the Federal Acquisition Streamlining Act of 1994, Pub. L. 103-
355 (31 U.S.C. 6101 note).
Sec. 2700.20 Does this part apply to me?
This part and, through this part, pertinent portions of the OMB
guidance in subparts A through I of 2 CFR part 180 (see table at 2 CFR
180.100(b)) apply to you if you are a--
(a) Participant or principal in a ``covered transaction'' (see
subpart B of 2 CFR part 180 and the definition of ``nonprocurement
transaction'' at 2 CFR 180.970);
(b) Respondent in an SBA suspension or debarment action;
(c) SBA debarment or suspension official; or
(d) SBA grants officer, agreements officer, or other official
authorized to enter into any type of nonprocurement transaction that is
a covered transaction.
Sec. 2700.30 What policies and procedures must I follow?
The SBA policies and procedures you must follow are the policies
and procedures specified in each applicable section of the OMB guidance
in subparts A through I of 2 CFR part 180, as that section is
supplemented by the section in this part with the same section number.
The contracts that are covered transactions, for example, are specified
by section 220 of the OMB guidance (i.e., 2 CFR 180.220) as
supplemented by section 220 of this part (i.e., Sec. 2700.220). For
any section of OMB guidance in Subparts A through I of 2 CFR 180 that
has no corresponding section in this part, SBA policies and procedures
are those in the OMB guidance.
Subpart A--General
Sec. 2700.137 Who in the Small Business Administration may grant an
exception to let an excluded person participate in a covered
transaction?
The Director of the Office of Lender Oversight may grant an
exception permitting an excluded person to participate in a particular
covered transaction under SBA's financial assistance programs. For all
other Agency programs, the Director of the Office of Business
Operations may grant such an exception.
Subpart B--Covered Transactions
Sec. 2700.220 What contracts and subcontracts, in addition to those
listed in 2 CFR 180.220, are covered transactions?
In addition to the contracts covered under 2 CFR 180.22(b) of the
OMB
[[Page 39729]]
guidance, this part applies to any contract, regardless of tier, that
is awarded by a contractor, subcontractor, supplier, consultant, or its
agent or representative in any transaction, if the contract is to be
funded or provided by the SBA under a covered nonprocurement
transaction and the amount of the contract is expected to equal or
exceed $25,000. This extends the coverage of the SBA nonprocurement
suspension and debarment requirements to all lower tiers of
subcontracts under covered nonprocurement transactions, as permitted
under the OMB guidance at 2 CFR 180.200(c) (see optional lower tier
coverage in the figure in the Appendix to 2 CFR part 180)
Subpart C--Responsibilities of Participants Regarding Transactions
Sec. 2700.332 What methods must I use to pass requirements down to
participants at lower tiers with whom I intend to do business?
You, as a participant, must include a term or condition in lower-
tier transactions requiring lower-tier participants to comply with
subpart C of the OMB guidance in 2 CFR part 180, as supplemented by
this part.
Subpart D--Responsibilities of Federal Agency Officials Regarding
Transactions
Sec. 2700.437 What method do I use to communicate to a participant
the requirements described in the OMB guidance at 2 CFR 180.435?
To communicate to a participant the requirements described in 2 CFR
180.435 of the OMB guidance, you must include a term or condition in
the transaction that requires the participant's compliance with subpart
C of 2 CFR part 180, as supplemented by subpart C of this part, and
requires the participant to include a similar term or condition in
lower-tier covered transactions.
Subpart E-F--[Reserved]
Subpart G--Suspension
Sec. 2700.765 How may I appeal my suspension?
(a) If the SBA suspending official issues a decision under Sec.
180.755 to continue your suspension after you present information in
opposition to that suspension under Sec. 180.720, you may ask for
review of the suspending official's decision in two ways:
(1) You may ask the suspending official to reconsider the decision
for material errors of fact or law that you believe will change the
outcome of the matter; or
(2) You may request that the SBA Office of Hearings and Appeals
(OHA) review the suspending official's decision to continue your
suspension within 30 days of your receipt of the suspending official's
decision under Sec. 180.755 or paragraph (a)(1) of this section.
However, OHA may reverse the suspending official's decision only where
OHA finds that the decision is based on a clear error of material fact
or law, or where OHA finds that the suspending official's decision was
arbitrary, capricious, or an abuse of discretion. You may appeal the
suspending official's decision without requesting reconsideration, or
you may appeal the decision of the suspending official on
reconsideration. The procedures governing OHA appeals are set forth in
13 CFR part 134.
(b) A request for review under this section must be in writing;
state the specific findings you believe to be in error; and include the
reasons or legal bases for your position.
(c) OHA, in its discretion, may stay the suspension pending review
of the suspending official's decision.
(d) The SBA suspending official and OHA must notify you of their
decision under this section, in writing, using the notice procedures
set forth at Sec. Sec. 180.615 and 180.975.
Subpart H--Debarment
Sec. 2700.890 How may I appeal my debarment?
(a) If the SBA debarring official issues a decision under Sec.
180.870 to debar you after you present information in opposition to a
proposed debarment under Sec. 180.815, you may ask for review of the
debarring official's decision in two ways:
(1) You may ask the debarring official to reconsider the decision
for material errors of fact or law that you believe will change the
outcome of the matter; or
(2) You may request that the SBA Office of Hearings and Appeals
(OHA) review the debarring official's decision to debar you within 30
days of your receipt of the debarring official's decision under Sec.
180.870 or paragraph (a)(1) of this section. However, OHA may reverse
the debarring official's decision only where OHA finds that the
decision is based on a clear error of material fact or law, or where
OHA finds that the debarring official's decision was arbitrary,
capricious, or an abuse of discretion. You may appeal the debarring
official's decision without requesting reconsideration, or you may
appeal the decision of the debarring official on reconsideration. The
procedures governing OHA appeals are set forth in 13 CFR part 134.
(b) A request for review under this section must be in writing;
state the specific findings you believe to be in error; and include the
reasons or legal bases for your position.
(c) OHA, in its discretion, may stay the debarment pending review
of the debarring official's decision.
(d) The SBA debarring official and OHA must notify you of their
decision under this section, in writing, using the notice procedures
set forth at Sec. Sec. 180.615 and 180.975.
Subpart I--Definitions
Sec. 2700.930 Debarring official (SBA supplement to government-wide
definition at 2 CFR 180.930).
For SBA, the debarring official for financial assistance programs
is the Director of the Office of Lender Oversight; for all other
programs, the debarring official is the Director of the Office of
Business Operations.
Sec. 2700.995 Principal (SBA supplement to government-wide definition
at 2 CFR 180.995).
Principal means--
(a) Other examples of individuals who are principals in SBA covered
transactions include:
(1) Principal investigators.
(2) Securities brokers and dealers under the section 7(a) Loan,
Certified Development Company (CDC) and Small Business Investment
Company (SBIC) programs.
(3) Applicant representatives under the section 7(a) Loan, CDC,
SBIC, Small Business Development Center (SBDC), and section 7(j)
programs.
(4) Providers of professional services under the section 7(a) Loan,
CDC, SBIC, SBDC, and section 7(j) programs.
(5) Individuals that certify, authenticate or authorize billings.
(b) [Reserved]
Sec. 2700.1010 Suspending official (SBA supplement to government-wide
definition at 2 CFR 180.1010).
For SBA, the suspending official for financial assistance programs
is the Director of the Office of Lender Oversight; for all other
programs, the suspending official is the Director of the Office of
Business Operations.
[[Page 39730]]
Subpart J--[Reserved]
Title XIII--Business Credit and Assistance; Chapter I--Small Business
Administration
PART 134--RULES OF PROCEDURE GOVERNING CASES BEFORE THE OFFICE OF
HEARINGS AND APPEALS
0
2. The authority citation for part 134 continues to read as follows:
Authority: 5 U.S.C. 504; 15 U.S.C. 632, 634(b)(6), 637(a),
648(l), 656(i), and 687(c); E.O. 12549, 51 FR 6370, 3 CFR, 1986
Comp., p. 189.
Sec. 134.102 [Amended]
0
3. Section 134.102(p) of subpart B is amended by removing ``part 145 of
this chapter'' and adding ``2 CFR parts 180 and 2700'' in its place.
PART 145--[REMOVED]
0
4. Under the authority of 15 U.S.C. 634, 13 CFR part 145 is removed.
Dated: July 12, 2007.
Steven C. Preston,
Administrator.
[FR Doc. E7-14035 Filed 7-19-07; 8:45 am]
BILLING CODE 8025-01-P
