II

103D CONGRESS

1ST SESSION S. 1623

To require the Secretary of Agriculture to carry out procedures for debarment

of persons engaged in nonprocurement programs and activities with the

Department of Agriculture who have violated the regulations of a program, and for other purposes.

IN THE SENATE OF THE UNITED STATES

NOVEMBER 4 (legislative day, NOVEMBER 2), 1993

Mr. LEAHY introduced the following bill; which was read twice and referred

to the Committee on Agriculture, Nutrition and Forestry

A BILL

To require the Secretary of Agriculture to carry out procedures for debarment of persons engaged in

nonprocurement programs and activities with the Department of Agriculture who have violated the regulations

of a program, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘USDA Debarment Act

5 of 1993’’.

6 SEC. 2. FINDINGS.

7 Congress finds that—
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1 (1) dating back to 1986, several Secretaries of

2 Agriculture have failed to comply with Executive

3 Order No. 12549, which was intended to ensure that

4 the Federal Government did not continue to do busi5 ness with companies that violate the regulations of

6 a program of any Executive agency;

7 (2) several companies that have violated the

8 regulations of programs within the Department of

9 Agriculture (such as programs related to inter10 national agricultural trade, food and nutrition, com11 modity storage, and livestock trade) continue to par12 ticipate in the programs with respect to which the

13 companies have violated the regulations; and

14 (3) companies that have violated, and continue

15 to violate, regulations governing Department pro16 grams have received billions of dollars, and continue

17 to monetarily benefit.

18 SEC. 3. DEFINITIONS.

19 As used in this Act:

20 (1) DEPARTMENT.—The term ‘‘Department’’

21 means the United States Department of Agriculture.

22 (2) EXECUTIVE AGENCY.—The term ‘‘Executive

23 agency’’ has the same meaning as is provided in sec24 tion 105 of title 5, United States Code.
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1 (3) FINAL DETERMINATION.—The term ‘‘final

2 determination’’ means the final decision of the Sec3 retary in a nonprocurement debarment proceeding

4 involving a person as to whether the person has

5 committed a material violation—

6 (A) including a final decision regarding the

7 term of the debarment; but

8 (B) not including a decision as to whether

9 there is sufficient reason for initiation of a

10 nonprocurement debarment proceeding.

11 (4) MATERIAL VIOLATION.—The term ‘‘mate12 rial violation’’ means an action or series of actions

13 taken by a person that constitute a substantial and

14 material violation of a regulation of a program of

15 the Department, as determined by the Secretary.

16 (5) NONPROCUREMENT DEBARMENT.—The

17 term ‘‘nonprocurement debarment’’ means an action

18 to bar a person from programs and activities involv19 ing Federal financial and nonfinancial assistance of20 fered by the Department, but not including—

21 (A) Federal procurement programs and ac22 tivities;

23 (B) contracts entered into by the Commod24 ity Credit Corporation under the price support

25 operations and other programs of the Corpora-
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1 tion with persons in the capacities of the per2 sons as agricultural producers;

3 (C) conservation programs administered by

4 the Secretary; and

5 (D) individuals and households who par6 ticipate in nutrition assistance programs admin7 istered by the Secretary.

8 (6) PERSON.—The term ‘‘person’’ means any

9 individual, corporation, partnership, association, or

10 other legal entity, however organized, who is partici11 pating, or has participated, in a program or activity

12 of the Department.

13 (7) SECRETARY.—The term ‘‘Secretary’’ means

14 the Secretary of Agriculture.

15 SEC. 4. NONPROCUREMENT DEBARMENT.

16 (a) INITIATION OF PROCEEDINGS.—Except as pro17 vided in subsection (c), if the Secretary obtains notice of

18 the alleged occurrence of a material violation of a regula19 tion of a program or activity of the Department and the

20 Secretary determines under subsection (b) that there is

21 sufficient reason for initiation of a nonprocurement debar22 ment proceeding the Secretary shall initiate a

23 nonprocurement debarment proceeding against the person

24 not later than 180 days after the determination.
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1 (b) SUFFICIENT REASON FOR INITIATION OF

2 NONPROCUREMENT DEBARMENT PROCEEDINGS.—Sub3 ject to subsection (c), sufficient reason for initiation of a

4 nonprocurement debarment proceeding includes, as deter5 mined by the Secretary—

6 (1) the violation of a Federal or State law rel7 evant to the integrity or orderly administration of

8 the program or activity of the Department in which

9 the person is participating; or

10 (2) the commission of an action that may con11 stitute a material violation of a regulation applicable

12 to a program or activity of the Department.

13 (c) EXCEPTION.—If the Secretary determines that a

14 decision to initiate a nonprocurement debarment proceed15 ing cannot be made within the 180-day period referred

16 to in subsection (a) because of the need to further inves17 tigate the actions of a person relating to the alleged mate18 rial violation, the Secretary may have such additional time

19 as the Secretary considers necessary to make a decision,

20 but not more than 180 days beyond the original 180-day

21 period.

22 SEC. 5. NONPROCUREMENT DEBARMENT PROCEEDINGS.

23 (a) NOTICE AND HEARING.—Subsequent to the de24 termination that there is sufficient reason for initiation

25 of a nonprocurement debarment proceeding under section
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1 4, the Secretary shall provide the person against whom

2 the proceeding has been initiated with—

3 (1) full notice of the allegations;

4 (2) the opportunity for an informal hearing not

5 on the record, in which the person is provided appro6 priate due process procedures, as determined by the

7 Secretary, including an opportunity to rebut any al8 legation of a material violation;

9 (3) notice of the finding of the Secretary on

10 whether 1 or more material violations were commit11 ted by the person; and

12 (4) notice of the appropriate period of debar13 ment.

14 (b) PERIOD OF DEBARMENT.—Subject to subsection

15 (e), a person determined to have committed a material vio16 lation shall be ineligible to participate in the program or

17 activity in which the material violation occurred during the

18 5-year period beginning on the date of the determination.

19 (c) PREVIOUS DEBARMENT.—Subject to subsection

20 (e), a person who has been previously debarred by another

21 Executive agency, or has been previously debarred under

22 a nonprocurement debarment proceeding under this Act,

23 who is determined by the Secretary to have committed a

24 material violation based on a separate set of factual occur-
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1 rences, shall be permanently debarred from participating

2 in any program or activity of the Department.

3 (d) EXHAUSTION OF ADMINISTRATIVE REMEDIES.—

4 Prior to seeking judicial review in a court of competent

5 jurisdiction, a person against whom a nonprocurement de6 barment proceeding has been initiated shall—

7 (1) exhaust all administrative procedures pre8 scribed by the Secretary; and

9 (2) receive notice of the final determination of

10 the Secretary.

11 (e) GOOD FAITH.—If the Secretary determines that

12 a person, against whom there is sufficient reason for initi13 ation of a nonprocurement debarment proceeding, or

14 against whom a finding of material violation has already

15 been made, committed the act that is the subject of the

16 nonprocurement debarment proceeding in good faith, the

17 Secretary may reduce or eliminate the applicable periods

18 of debarment specified in subsections (b) and (c).

19 (f) COORDINATION.—To the maximum extent prac20 ticable, the Secretary shall consolidate and coordinate any

21 nonprocurement debarment action taken under this Act

22 with other adverse actions within the Department, includ23 ing other nonprocurement debarment actions.

24 (g) PRECEDENCE.—This Act shall take precedence

25 over any administrative procedure for debarment that af-
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1 fects the Department, to the extent that the procedure

2 conflicts with this Act.

3 SEC. 6. REPORT ON CONSISTENT DEBARMENT POLICY.

4 Not later than 120 days after the date of enactment

5 of this Act, the Director of the Office of Management and

6 Budget shall advise the appropriate committees of Con7 gress and the Comptroller General of the United States

8 as to the appropriateness and usefulness of a policy for

9 procurement debarment and a policy for nonprocurement

10 debarment that are applicable all Executive agencies.

11 SEC. 7. REGULATIONS.

12 (a) IN GENERAL.—Not later than 30 days after the

13 date of enactment of this Act, the Secretary shall issue

14 regulations to ensure compliance with such provisions of

15 Executive Order No. 12549 as are not in conflict with this

16 Act.

17 (b) RULEMAKING PROCEEDING.—Not later than 30

18 days after the date of enactment of this Act, the Secretary

19 shall initiate a rulemaking proceeding to implement this

20 Act. The rulemaking proceeding shall—

21 (1) identify all agencies, programs, and activi22 ties that are affected by this Act;

23 (2) specify what is sufficient reason for initi24 ation of a nonprocurement debarment proceeding;

25 (3) specify the procedures for the proceeding;
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1 (4) specify guidelines for the finding of a mate2 rial violation; and

3 (5) specify the administrative action to be taken

4 against a person found to have committed a material

5 violation.

6 SEC. 8. TERMINATION OF AUTHORITY.

7 The authority provided by this Act shall terminate

8 on September 30, 1999.

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