# Presentation: 273032

## Procurement Integrity

**- Conflicts of Interest**
**- Gifts**
**- Procurement Integrity Act**

## Overview

**Conflict of Interest**
**Gifts from Contractors**
**The Procurement Integrity Act**

## Conflicts of Interest

**Definition -- Official vs. Personal Capacity**
- Acting in your "Official Capacity" means that:
- You are acting on behalf of the Federal Government
- You may use government resources in support of your activities
- You may use your government title and org. name
- Acting in your "Personal Capacity" means that:
- You are acting as a private citizen
- You generally may not use government resources
- You may not use your government title or org. name

## Mandatory Disqualification 

**It is a CRIME to participate personally & substantially (e.g., make a decision, give advice, make a recommendation) in any government matter that would affect the financial interests of:**
- You,
- Your spouse,
- Your minor child, or
- Your general partner

## Mandatory Disqualification

**It is a CRIME to participate personally & substantially in any government matter that would affect the financial interests of:**
- An organization in which you are serving as an officer, director, trustee, general partner or employee, OR
- An organization with which you are negotiating for employment (or have an arrangement for future employment

## Appearance of Loss of Impartiality 

**An employee may not participate in a government matter that affects the financial interests of: **
- A member of the employee's household
- A relative with whom the employee has a close personal relationship
- An organization in which the employee is an active participant
- A person with which the employee has (or is seeking) a financial relationship
- Organization for whom the employee served within the last year, as an officer, director, trustee, consultant, contractor or employee.
- Person or company in which the employee’s spouse, partner or dependant child is serving (or is seeking to serve) as an officer, director, trustee, consultant, contractor or employee
**Waivers**

## Conflict of Interest - Stock Ownership

**If you (or your spouse or minor child) own stock in a company, you may not work on:**
- Any contract awarded to the company
- Any source selection in which the company is competing
- Any other government matter in which the company has a financial interest
* *** Exception: If the stock has a market value of $15,000 or less*

## Gifts From Contractors

**Federal employees may not accept gifts from contractors or contractor personnel.**** **
**Exceptions**
- Gifts other than cash not exceeding $20 may be accepted as long as the employee has not accepted other gifts from that contractor, when accumulated, exceed $50 for the year (*note - employees cannot "buy-down" - pay $5 for a $25 gift)
- Federal employees may accept gifts from a contractor employee that are based on a bona fide personal relationship (paid for by the contractor employee)
- Federal employees may accept invitations (even from contractors) that are open to the public, all Government employees, or all military employees
- Federal employees may accept invitations offered to a group or class that is not related to Government employment.

## The Four Basic Provisions of the Procurement Integrity Act

**Ban on disclosing procurement information**
**Ban on obtaining procurement information **** **
**Requirement to report employment contacts**** **
**One year ban from accepting compensation from any contractor awarded a contract over $10 million**

## Ban on Disclosing Procurement Information

**Prohibits, before contract award, the disclosure of :**
- Source Selection Information
- Contractor bid or proposal information
**The ban applies to:**
- Present or **Former Officials** of the U.S. or a Person who is acting or has acted for or on behalf of, or who is advising or has advised the U.S. with respect to, a Federal agency procurement; and
**ANYONE** who by virtue of that office, employment, or relationship has or had access to contractor bid and proposal information or source selection information
- 	*See* 41 USC 423(a)(2)(A),(B)

## Who is an “Official”?

**An employee of the FAA**
**An officer of any non–FAA Federal Agency**
**An employee of any non-FAA Federal Agency**
**A member of the uniformed services**
**Program manager**
**FAA Integrated Product Team (IPT) lead or Acting lead**
**FAA Product Team (PT) lead or Acting lead**
**Deputy or Acting Deputy to an FAA IPT lead**
**Deputy or Acting Deputy to an FAA Product Team PT Lead**

## What is Source Selection Information (SSI)?

**"SSI" means any following types of information:**
- Proposed costs or prices submitted in response to a FAA SIR
- Source selection plans
- Technical evaluation plans
- Technical evaluations
- Cost or price evaluation plans
- Down select determinations
- Ranking of offerors
- Reports, evaluations and recommendations of evaluation boards or advisory councils
- Other information, if:
- The contracting officer has determined that its disclosure would jeopardize the integrity of the procurement.

## What is Contractor Bid or Proposal Information (CBPI)?

**CBPI means any of following types of information:**
- Cost or pricing data (as defined by appendix C of the AMS)
- Indirect costs and direct labor rates
- Proprietary information about manufacturing processes, operations, or techniques marked by the contractor in accordance with applicable law or regulation
- Information marked by the contractor in accordance with (1) AMS Clause 3.2.2.3-16, “Restriction on Disclosure and Use of Data,” or (2) other applicable law and regulation.

## What’s Not Prohibited?

**NO prohibition on disclosing the following information:**
- Information that has been disclosed publicly or made available to the public
- Contractors are not prohibited from disclosing their own CBPI
*The ban on disclosing SSI & CBPI does not authorize the withholding of information from Congress, the Comptroller General, or the IG*

## Disclosing or Obtaining SSI or CBPEPenalty for Individuals

**If an individual improperly discloses or obtains SSI or CBPI**
-  In exchange for anything of value, or
-  In order to obtain for himself, or give to anyone else, a competitive advantage in the award of a Federal contract
** ****The maximum penalty is:**
- Five years in prison
- Civil penalty of $50,000 for each violation,
- Adverse personnel action (i.e. termination)
**If an individual knowingly discloses or obtains SSI or CBPI in violation of Procurement integrity Act (but not in exchange for anything of value, or to give anyone a competitive advantage), maximum penalty is:**
- Civil penalty of $50,000 for each violation, and
- Adverse personnel action (i.e. termination)

## Employment Contact Reporting Rule

**If an employee is**
-  Participating personally & substantially in a procurement, and
-  Contacts, or is contacted by, a bidder or offeror regarding possible employment
**Then the employee must—**
- Give written report to supervisor & Agency ethics official (or designee), and
-  Either (1) reject the possibility of employment or (2) be disqualified from working on the procurement until the job discussions end and there is no arrangement for employment.
**Penalties –**
-  Civil penalty of $50,000 for each violation
-  Adverse personnel action (i.e. termination)
- Other criminal statutes

## Post Employment – 1 Year Compensation Ban

**A former official of a Federal agency may not accept compensation from a contractor for one year post employment.  This includes compensation granted in any of the following positions:**
- Employee
- Officer
- Director
- Consultant
**The prohibition applies to those who served in one of several positions, or who make one of several types of decisions, on a contract in excess of $10 million**

## Post Employment - Positions Resulting in 1 year Compensation Ban

**The Ban applies to those people who held the following positions at the time of selection of the contractor or award of the contract****:**
- Contracting Officer
- Source Selection Official
-  Member of an Evaluation team
- Program Manager
- Deputy Program Manager

## Post-employment Decisions Resulting in 1 Year Compensation Ban

**The Ban applies to those people who made the following decisions at the time of the selection of the contractor or award of a contract in excess of $10 million.**
- award a contract
- award a subcontract
- award a modification
- award a task order or delivery order
- establish overhead or other rates applicable to a contract
- approve issuance of a contract payment or payments
- pay or settle claim

## When Does the 1 Year Ban Start?

**For CO's, SSO's, SEB members & evaluation team leads - ban starts on date of contract award**
-  Exception:  If an individual was serving in the position on the date of contractor selection, but not on the date of contract award, the ban begins to run on date of contractor selection.
**FOR PM's, DPM's & COs, ban starts to run on last day of service in the position**
- For decision-makers, ban starts on date of decision

## Other Provisions of the 1 Year Compensation Ban

**1-year ban does not apply to accepting compensation from any division or affiliate of a contractor that does not produce the "same or similar products or services" as the entity of the contractor that has the contract the person worked on**** **
**If 1-year ban applies:**
-  Individual may not accept compensation, &
-  Contractor may not provide compensation

## Legal Opinions

**Individuals may request advice on:**
- Whether 1-year ban applies to their situation
- Other Post-Employment Issues

## Penalty for Individuals Violating 1 Year Compensation Ban

**If an individual accepts compensation from a contractor in violation of 1-year compensation ban, maximum penalty is:**
- Civil penalty of $50,000, plus
- Civil penalty of twice the amount of compensation the individual received in violation of the ban