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.

Rules and Regulations Federal Register

31037 

Vol. 83, No. 128 

Tuesday, July 3, 2018 

OFFICE OF MANAGEMENT AND 

BUDGET 

2 CFR Part 180 

OMB Guidelines to Agencies on 

Governmentwide Debarment and 

Suspension (Nonprocurement) 

AGENCY: Office of Management and 

Budget. 

ACTION: Interim final action. 

SUMMARY: The Office of Management 

and Budget (OMB) is amending the 

OMB guidance to agencies on 

governmentwide nonprocurement 

debarment and suspension 

(nonprocurement) to implement a 

section of the National Defense 

Authorization Act for Fiscal Year 2017 

(NDAA) that prohibits awards to 

persons or entities involved in activities 

that violate arms control treaties or 

agreements with the United States. The 

NDAA requires revision of these OMB’s 

Uniform Administrative Requirements, 

Cost Principles, and Audit 

Requirements for Federal Awards. To 

fully implement the NDAA requirement 

necessitates revision of OMB Guidelines 

to agencies on Governmentwide 

Debarment and Suspension 

(Nonprocurement). 

DATES: 

Effective date: July 3, 2018. 

Comments due date: Interested parties 

should submit comments electronically 

to www.regulations.gov on or before 

September 4, 2018 to be considered in 

the formation of the final guidance. 

ADDRESSES: Comments on this interim 

action must be submitted electronically 

before the comment closing date to 

www.regulations.gov. In submitting 

comments, please search for recent 

submissions by OMB to find docket 

OMB–2018–0001. The public comments 

received by OMB will be a matter of 

public record and will be posted at 

www.regulations.gov. Accordingly, 

please do not include in your comments 

any confidential business information or 

information of a personal-privacy 

nature. If you send an email comment, 

your email address will be 

automatically captured and included as 

part of the comment that is placed in the 

public docket. Please note that 

responses to this public comment 

request containing any routine notice 

about the confidentiality of the 

communication will be treated as public 

comments notwithstanding the 

inclusion of the routine notice. 

FOR FURTHER INFORMATION CONTACT: Gil 

Tran, OMB, Office of Federal Financial 

Management at 202–395–3052 or Hai_

M._Tran@omb.eop.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The System for Award Management 

(SAM) Exclusions is a list of persons 

and entities ineligible for Federal 

awards. Currently, Federal awarding 

agencies are required to check the list 

before making Federal awards to 

determine whether the person or entity 

is excluded, debarred, suspended, or 

otherwise prohibited from receiving 

Federal awards. If the person or entity 

is identified as prohibited from 

receiving Federal awards, Federal 

awarding agencies cannot make the 

award unless the Federal agency head or 

designee allows an exception consistent 

with existing law. This requirement 

flows down to Federal award recipients, 

who are required to check SAM 

Exclusions for all subawards and 

contracts equal to or exceeding $25,000. 

However, these requirements do not 

currently apply to a limited number of 

Federal awards given to certain types of 

foreign entities. The purpose of this 

interim action is to amend OMB 

Guidelines to agencies on 

Governmentwide Debarment and 

Suspension (Nonprocurement) to extend 

these requirements of potential Federal 

awards to persons, entities, or 

organizations that have engaged in any 

activity that contributed to or is a 

significant factor in a country’s noncompliance with its obligations under 

arms control, nonproliferation, or 

disarmament agreements or 

commitments with the United States. 

Pursuant to 22 U.S.C. 2593e(a)(1), the 

Secretary of the Treasury is required to 

submit to the appropriate Congressional 

committees a report, consistent with the 

protection of intelligence sources and 

methods, identifying every person with 

respect to whom there is credible 

information indicating that the person is 

an individual who is a citizen, national, 

or permanent resident of, or an entity 

organized under the laws of, a 

noncompliant country as described in 

22 U.S.C. 2593e(a)(2); and has engaged 

in any activity that contributed to or is 

a significant factor in the President’s or 

the Secretary of State’s determination 

that such country is noncompliant. 

The Secretary of the Treasury also 

identifies any person or entity that has 

provided material support for such 

noncompliance to a person or entity 

engaged in the noncompliant activities. 

The Secretary of Treasury posts this 

information, as appropriate and 

consistent with the protection of 

intelligence sources and methods, as an 

exclusion record in the SAM database. 

If the person or entity is on the SAM 

Exclusions list, the person or entity may 

not receive Federal awards and awards 

may not be renewed or extended. 

With respect to each person or entity 

identified by the Secretary of the 

Treasury as having provided material 

support, the NDAA calls for the 

imposition of certain measures. 

Specifically, section 1290(c)(1) requires 

that the head of any executive agency 

may not enter into, renew, or extend a 

contract for the procurement of goods or 

services with such person or entity. 

Furthermore, section 1290(c)(3) directs 

that the Federal Acquisition Regulation 

(FAR), the Defense Federal Acquisition 

Regulation Supplement, and the 

Uniform Administrative Requirements, 

Cost Principles, and Audit 

Requirements for Federal Awards be 

revised accordingly to implement the 

NDAA requirement. The revisions to the 

FAR were published in the Federal 

Register on June 15, 2018 (83 FR 28145, 

FAR Case 2017–018). This action 

amends 2 CFR 180.215 to implement 

section 1290 of the NDAA. 

Discussion and Analysis 

This action amends 2 CFR part 180 to 

ensure that entities who have engaged 

in activity that contributed to or is a 

significant factor in a country’s noncompliance with its obligations under 

arms control, nonproliferation or 

disarmament agreements or 

commitments with the United States are 

restricted from receiving nonprocurement and procurement 

transactions. Currently, 2 CFR part 180 


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31038 Federal Register / Vol. 83, No. 128 / Tuesday, July 3, 2018 / Rules and Regulations 

restricts Federal awards that are 

considered covered transactions to 

persons or entities that are listed in 

SAM Exclusions and these requirements 

flow down to all covered transactions, 

including: (1) All nonprocurement 

subawards; and (2) contracts that equal 

or exceed $25,000. However, 2 CFR 

180.215 provides specific exceptions 

from what are considered covered 

transactions, including awards to 

certain types of foreign entities. This 

action revises 2 CFR 180.215 to define 

‘‘covered transactions’’ to include direct 

awards, regardless of tier or amount for 

non-procurement and procurement 

transaction, to exempt foreign persons, 

entities and organizations if such 

persons, entities, or organizations have 

engaged in any activity that contributed 

to or is a significant factor in a country’s 

non-compliance with its obligations 

under arms control, nonproliferation or 

disarmament agreements or 

commitments with the United States. 

Executive Orders 12866 and 13563 

Executive Orders (E.O.s) 12866 and 

13563 direct agencies to assess all costs 

and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). E.O. 13563 emphasizes the 

importance of quantifying both costs 

and benefits, of reducing costs, of 

harmonizing rules, and of promoting 

flexibility. This is not a significant 

regulatory action and, therefore, was not 

subject to review under Section 6(b) of 

E.O. 12866. In addition, this action is 

not a major rule under 5 U.S.C. 804. 

Executive Order 13771 

This action is not an E.O. 13771 

regulatory action because it is not 

significant under E.O. 12866. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act, 5 

U.S.C. 601, et seq., requires that an 

agency provide a final regulatory 

flexibility analysis or certify that the 

rule will not have a significant 

economic impact on a substantial 

number of small entities. OMB does not 

expect this interim action to have a 

significant economic impact on a 

substantial number of small entities 

within the meaning of the Regulatory 

Flexibility Act. 

This interim action implements the 

provisions of section 1290 of the NDAA 

and will not have a significant economic 

impact on a substantial number of small 

entities because it will affect only a 

small number of Federal awards that are 

currently excluded from the definition 

of covered transactions. Currently, the 

vast majority of Federal awards are 

subject to the 2 CFR part 180 provisions 

that apply to covered transactions. 

Paperwork Reduction Act 

The Paperwork Reduction Act does 

not apply because the changes to 2 CFR 

part 180 do not impose incremental 

recordkeeping or information collection 

requirements, or the collection of 

information that require the approval of 

the Office of Management and Budget 

under 44 U.S.C. 3501, et seq. 

Determination To Issue Interim Action 

As this regulatory action involves a 

matter relating to Federal awards, it is 

not subject to the public procedure 

requirements of the informal rulemaking 

provisions of the Administrative 

Procedure Act. See 5 U.S.C. 553(a)(2). 

Nevertheless, OMB is voluntarily 

seeking comment to be considered in 

the formation of the final action. 

List of Subjects in 2 CFR Part 180 

Administrative practice and 

procedure, Debarment and suspension, 

Grant programs, Reporting and 

recordkeeping requirements. 

Timothy F. Soltis, 

Deputy Controller. 

For the reasons stated in the 

preamble, the Office of Management and 

Budget amends 2 CFR part 180, as set 

forth below: 

PART 180—OMB GUIDELINES TO 

AGENCIES ON GOVERNMENTWIDE 

DEBARMENT AND SUSPENSION 

(NONPROCUREMENT) 

■ 1. The authority citation for part 180 

is revised to read as follows: 

Authority: Pub. L. 109–282; 31 U.S.C. 

6102, Sec. 2455, Pub. L. 103–355, 108 Stat. 

3327; E.O. 12549, 3 CFR, 1986 Comp., p. 189; 

E.O. 12689, 3 CFR, 1989 Comp., p. 235. 

■ 2. In § 180. 215, add paragraph (h) to 

read as follows: 

§ 180. 215 Which nonprocurement 

transactions are not covered transactions? 

* * * * * 

(h) Notwithstanding paragraph (a) of 

this section, covered transactions must 

include non-procurement and 

procurement transactions involving 

entities engaged in activity that 

contributed to or is a significant factor 

in a country’s non-compliance with its 

obligations under arms control, 

nonproliferation or disarmament 

agreements or commitments with the 

United States. Federal awarding 

agencies and primary tier nonprocurement recipients must not award, 

renew, or extend a non-procurement 

transaction or procurement transaction, 

regardless of amount or tier, with any 

entity listed in the System for Award 

Management Exclusions List on the 

basis of involvement in activities that 

violate arms control, nonproliferation or 

disarmament agreements or 

commitments with the United States, 

pursuant to section 1290 of the National 

Defense Authorization Act for Fiscal 

Year 2017, unless the head of a Federal 

agency grants an exception pursuant to 

2 CFR 180.135 with the concurrence of 

the OMB Director. 

[FR Doc. 2018–14279 Filed 6–29–18; 8:45 am] 

BILLING CODE 3110–01–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

24 CFR Part 200 

[Docket No. FR–5457–F–02] 

RIN 2502–AJ03 

Streamlining Inspection Requirements 

for Federal Housing Administration 

(FHA) Single-Family Mortgage 

Insurance: Removal of the FHA 

Inspector Roster 

AGENCY: Office of the Assistant 

Secretary of Housing—Federal Housing 

Commissioner, HUD. 

ACTION: Final rule. 

SUMMARY: This final rule streamlines the 

inspection requirements for FHA singlefamily mortgage insurance by removing 

the regulations for the FHA Inspector 

Roster (Roster). The Roster is a list of 

inspectors approved by FHA as eligible 

to determine if the construction quality 

of a one- to four-unit property is 

acceptable as security for an FHAinsured loan. The removal of the Roster 

regulations is based on the recognition 

of the sufficiency and quality of 

inspections carried out by certified 

inspectors and other qualified 

individuals. This final rule follows 

publication of a February 6, 2013, 

proposed rule, and takes into 

consideration the public comments 

received on the proposed rule. 

DATES: Effective date: August 2, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Elissa Saunders, Director, Office of 

Single Family Program Development, 

Office of Housing, Department of 

Housing and Urban Development, 451 

7th Street SW, Room 9184, Washington, 

DC 20410–8000; telephone number 202– 

708–2121 (this is not a toll-free 


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