Fuel Smarts

New Character Review for Government Contractors

November 27, 2000

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The U.S. Office of Management and Budget is reportedly poised to issue a final rule that would require government contracting officers to consider compliance with all federal regulations when reviewing companies bidding on government contracts.

Under current regulations, contracting officers look at a company’s financial resources and capability to deliver the goods or services as promised. They consider performance on other contracts and seek assurances that the company has a “satisfactory record of integrity and business ethics.”
The Washington Post reports that the Clinton Administration has finalized changes, proposed two years ago, that would require contracting officers to also look for patterns of noncompliance or repeated violations of labor, environmental, antitrust, tax, and many other laws.
The proposal received widespread criticism from numerous business groups. Many argue that the extensive “character reviews” will do little more than jam the process. Some say it will give labor unions a weapon against companies that resist attempts to organize employees. Even government agencies such as the Environmental Protection Agency and the General Services Administration have expressed concerns that the vague criteria could thwart other reforms and discourage some companies from bidding on government contracts.
The OMB says it has addressed those concerns and that the changes are needed to weed out contractors who “sometimes repeatedly” violate laws.

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