Conflict-of-interest rules could expand

Should the government expand conflict of interest rules to cover more than contractors who are doing work that is closely associated with acquisition jobs only federal employees should do?

Procurement policy officials asked that question in a request for information Nov. 2, seeking advice on a possible expansion of their final rule on personal conflicts of interests. The rule takes effect Dec. 2.

The Office of Federal Procurement Policy and the two acquisition policy councils have decided that contractors who have employees performing work that is closely associated with inherently governmental acquisition functions must identify, and then prevent, those employees' personal conflicts of interest.

The term "inherently governmental function" includes duties that require either exercising discretion in applying the government’s authority or making value judgments in decisions for the government, including monetary transactions, such as acquisitions. Only federal employees can do those jobs. The conflict of interest rule is intended to ensure contractor employees doing jobs closely connected to those inherently governmental functions don't have reasons to favor particular decisions or judgments.

In the rule, companies must have good oversight to verify compliance and report conflicts to the appropriate contracting officer while disciplining the employee, if necessary.

Companies are also responsible for screening potential employees’ conflicts and telling employees about their obligations when taking the job.

Based on responses to their 2009 proposed rule, federal officials revised the final version to make it clear that contractors have some flexibility in setting up screening. One method, for example, might require each employee to review a list of entities affected by the upcoming work and either disclose any conflict or confirm that he or she has none.

Another revision limits financial disclosures that might be affected by the job to where the employee has been assigned. Officials recognized too that they should include other potential sources of conflicts, including employment or gifts.

In comments, respondents raised concerns that the financial disclosure requirements were intrusive and keeping up was close to an impossibility, according to the notice.

The councils said they considered the concerns about a burdensome nature of the screening process, but decided they were necessary.

“The concerns expressed are outweighed by the importance of assuring the integrity of the government’s acquisition process,” they wrote.

The rule doesn’t address personal conflicts regarding functions other than those in the acquisition arena. Officials also want input on whether these rules should apply to functions that are not closely associated to an inherently governmental function.

But officials question whether there are more areas beyond acquisition. They have asked:

Are there contracting methods, types, and services that raise heightened concerns for potential personal conflicts of interest?

Should regulatory coverage expand beyond the functions closely associated to the most sensitive work in acquisition?

Officials are accepting thoughts on the questions until Jan. 3.