Monadnock Research - 13 November 2009

WASHINGTON, D.C. -- The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council are proposing to amend the "Federal Acquisition Regulation" (FAR) to address personal conflicts of interest by employees of government contractors as required by section 841(a) of the Duncan Hunter National Defense Authorization Act (NDAA) for Fiscal 2009.

The Duncan Hunter NDAA requires that the Office of Federal Procurement Policy (OFPP) develop a policy to prevent personal conflicts of interest by contractor employees performing acquisition functions closely associated with governmental functions either for or on behalf of a Federal agency or department. The NDAA also requires OFPP to develop personal conflicts-of-interest clauses for inclusion in solicitations, contracts, task orders, and delivery orders.

OFPP and the Councils are proposing a policy that will require each contractor that has employees performing acquisition functions closely associated with inherently governmental functions to identify and prevent personal conflicts of interest for such employees. In addition, such contractors will be required to prohibit covered employees with access to non-public Government information from using it for personal gain.

The proposed rule also makes contractors responsible for:

• Having procedures to screen for potential conflicts of interest;
• Informing covered employees of their obligations with regard to these policies;
• Maintaining effective oversight to verify compliance;
• Reporting any personal conflict-of-interest violations to the contracting officer; and
• Taking appropriate disciplinary action with employees who fail to comply with these policies.

This proposed rule does not address the issue of personal conflicts of interest by contractor employees with respect to other functions, or the issue of additional coverage addressing organizational conflicts of interest. Those issues will also be addressed by a regulation consistent with the requirements of section 841, which requires review by the Administrator for Federal Procurement Policy, in consultation with the Director of the Office of Government Ethics, to determine whether further revision to the FAR, and action by the FAR Council, is necessary.

The government estimate on the annual recordkeeping burden (in hours) is:

Recordkeepers ----------------------- 10,000
Records per recordkeeper ------------- x 36
Total annual records ------- -------- 360,000
Review hours per response ---------- x 0.17
Total recordkeeping burden --------- 61,200
Respondents ----------------------------- 460
Responses per responded ----------------- 1
Annual responses ------------------------ 460
Preparation time per response -------- 3.96
Total Annual --------------------------- 1,820

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