Certifications for Third Party Contractors

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Q. What pre-award procurement certifications and assurances are required for a “small purchase”?  Are the certifications and assurances described in FTA Circular 5010.1D required for a “small purchase”?

A. The certifications and assurances described in FTA Circular 5010.1D, “Grant Management Requirements,” November 1, 2008, apply to recipients of direct FTA grants and cooperative agreements.  As required by Federal law or regulations, several of those certifications and assurances, in turn, require the FTA recipient to take measures to obtain the compliance of their project participants, such as third party contractors and subrecipients, with the fundamental requirements of those certifications and assurances.

As to the issue of suspension and debarment, although the U.S. DOT regulations, “Nonprocurement Suspension and Debarment,” 2 C F.R. Part 1200, which adopt and supplement the U.S. Office of Management and Budget (U.S. OMB) “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. Part 180, do not expressly require a suspension and debarment certification, FTA is including a suspension and debarment certification in its FY 2011 Annual Certifications and Assurances for Recipients of FTA Assistance sought during that fiscal year as a means of identifying the recipient’s eligibility for Federal awards under those Federal regulations and guidelines. 

Due to changes in various Federal laws, the use of the term “small purchase” in your question can cause some confusion.  For example, FTA has used “small purchase” interchangeably with “simplified acquisition threshold” as that term is described in 41 U.S.C. § 403(11).  Notably, 41 U.S.C. § 403(11) establishes a $100,000 threshold, even if other inapplicable Federal regulations establish a different threshold amount).  However, for purposes of suspension and debarment, the Federal standard for “small purchase” has remained $25,000.

Since the inception of Governmentwide nonprocurement suspension and debarment regulations in 1988, recipients of Federal assistance have been required to assure themselves that they did not award a contract of $25,000 or more to any prospective contractor that was debarred or suspended by the Federal Government, unless the Federal Government granted an exception.  Under U.S. DOT’s former debarment and suspension regulations, 49 C.F.R. Part 29, Appendix B, recipients were required to obtain a “lower tier certification” from such each prospective contractor seeking to enter into a federally assisted contract that “The prospective lower tier participant certifies, by submission of this proposal, that neither it nor its principals is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction by any Federal department or agency;” or provide an explanation in its proposal. 

Upon issuance of U.S. OMB “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. Part 180, and promulgation of the companion U.S. DOT regulations, “Nonprocurement Suspension and Debarment,” FTA recipients are no longer required to obtain lower tier debarment and suspension certifications from their prospective contractors and subcontractors.  FTA recipients and their contractors and subrecipients, however, must comply with Federal debarment and suspension regulations and guidelines when administering any contract or subcontract  of $25,000 or more, regardless of tier.  Thus contract award may not be made to a prospective contractor or subcontractor if that contractor is excluded or disqualified under the standards of the U.S. DOT regulations and U.S. OMB guidelines, unless the Federal Government has provided an exception as permitted under those regulations and guidelines.  In addition, contracts of any amount for federally-required audit services are also covered by these DOT regulations and U.S. OMB guidelines.  The recipient and third party contractor must also obtain the compliance of lower tier contractors and subcontractors with the U.S. DOT debarment and suspension regulations and U.S. OMB guidelines that apply to them.

“Buy America” certifications are required only for contracts of $100,000 or more. See, FTA regulations, “Buy America Requirements,” 49 C.F.R. § 661.7, App. A.

A “Lobbying” certification is required of any person that requests or receives “(2) A subgrant, contract, or subcontract exceeding $100,000 at any tier under a Federal grant;” as provided in U.S. DOT regulations, “New Restrictions on Lobbying,” 49 C.F.R. § 20.110(d)(2). (Revised: October, 2010)

Q. Are the certifications to be signed by Third Party Contractors the same as are defined in 49 C.F.R. Part 29, Appendix B?

A. U.S. DOT regulations, “Governmentwide Debarment and Suspension (Nonprocurement),” 49 C.F.R. Part 29, have been rescinded and superseded by U.S. DOT regulations, “Nonprocurement Suspension and Debarment,” 2 C F.R. Part 1200.  The new U.S. DOT regulations adopt and supplement U.S. Office of Management and Budget (U.S. OMB) “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. Part 180.

The current U.S. DOT regulations and U.S. OMB guidelines do not mandate certifications for third party contractors or third party subcontractors.  Instead, the U.S. OMB guidelines at 2 C.F.R. § 180.300 (which are incorporated by reference into the U.S. DOT regulations) provide the following choices:
When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by:

(a) Checking the EPLS [U.S. General Services Administration Excluded Parties List System] ;or
(b) Collecting a certification from that person if allowed by the Federal agency responsible for the transaction; or
(c) Adding a clause or condition to the covered transaction with that person.
In addition, the recipient and third party contractor must also obtain the compliance of lower tier contractors and subcontractors with the U.S. DOT debarment and suspension regulations and U.S. OMB guidelines that apply to them. (Revised: October, 2010)


Q.
If mistakenly omitted from the mailed solicitation, can a Debarment Form be signed by the respondents before interviews are set up?

A. Yes.  Information about a prospective contractor’s suspension and debarment status may be obtained after bids and proposals are submitted.
(Revised: October, 2010)

Q. What forms and/or certificates does FTA require a recipient to include in Invitation for Quote (IFQ) procurements for purchases under $100,000?

A. FTA does not require any certifications from bidders for procurements that are under $100,000 in value.  Nevertheless, if the procurement exceeds $25,000, the recipient will be concerned about whether or not the contractor is eligible for award under the standards of U.S. DOT regulations, “Nonprocurement Suspension and Debarment,” 2 C. F.R. Part 1200, which adopt and supplement U.S. Office of Management and Budget (U.S. OMB) “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. Part 180. 
Although your question pertained to "certifications and forms," you will also need to be concerned with required clauses that must be included in contracts under $100,000.
(Revised: October, 2010)


Q.
What are the required certifications for projects (under $100,000) undertaken by two government agencies, when only one is a recipient of FTA grant funds? What certifications, if any, would be required of the local organization?

A. A direct recipient of FTA grant funds will be required to comply with FTA’s annual certification requirements as explained in FTA Circular 5010.1D, “Grant Management Requirements,” November 1, 2008.  The certifications required depend on what the recipient intends to do.  In addition, the U.S. Office of Management and Budget, “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. § 180.335, require recipients of Federal assistance to provide the following information to a Federal agency before entering into a “covered” relationship, such as a grant or contract, with that agency:

Before you enter into a covered transaction at the primary tier, you as the participant must notify the Federal agency office that is entering into the transaction with you, if you know that you or any of the principals for that covered transaction:

(a) Are presently excluded or disqualified;
(b) Have been convicted within the preceding three years of any of the offenses listed in § 180.800(a) or had a civil judgment rendered against you for one of those offenses within that time period;
(c) Are presently indicted for or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses listed in § 180.800(a); or
(d) Have had one or more public transactions (Federal, State, or local) terminated within the preceding three years for cause or default.

In the past, Federal Governmentwide regulations required debarment and suspension information be provided in the form of a certification.  Upon promulgation of the newer U.S. DOT regulations, “Nonprocurement Suspension and Debarment,” 2 C.F.R. Part 1200, which adopt and supplement U.S. Office of Management and Budget (U.S. OMB) “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. Part 180, only the information required by the regulations and guidelines was needed, irrespective of form.  This fiscal year, FTA is including a Debarment and Suspension certification in its annual certifications and assurances as a convenient means to obtain the necessary information from its direct recipients of FTA assistance.

As for what certifications an FTA recipient must collect from participants in its project, an FTA recipient receiving less than $100,000 would not be likely to enter into an FTA assisted contract of $100,000 or more, so it is unlikely that the recipient would need to be concerned about the the “Lobbying” certification required for contracts and subcontracts of these amounts.  If, however, the recipient were to enter into a third party contract valued at $25,000 or more, or a contract of any amount for federally required audit services, then the recipient would need to be certain that its prospective contractor qualified for award under the standards of the U.S. DOT debarment and suspension regulations and U.S. OMB guidelines incorporated by reference therein.  In addition, the recipient must also obtain the compliance of lower tier contractors and subcontractors with the U.S. DOT debarment and suspension regulations and U.S. OMB guidelines that apply to them. (Revised: October, 2010)


Q.
Where can one find information regarding the use of the Non-Collusion Affidavit form?

A. The Common Grant Rules, U.S. DOT regulations, “Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments,” at 49 C.F.R. Part 18 and U.S. DOT regulations, “Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations,” at 49 C.F.R. Part 19 do express concern about noncompetitive practices among contractors that may restrict or eliminate competition or restrain trade.  See, esp. 49 C.F.R. § 18.36(c) and 49 C.F.R. § 19.43.  However, neither those regulations nor other Federal regulations require a specific “non-collusion” certification or similar document.

Therefore, this is not a governmentwide mandatory certification but may be a requirement of a particular contract clause that is prescribed for certain situations. For example, the Federal Acquisition Regulation (FAR), Part 3.103-1, dealing with the issue of independent pricing, prescribe a solicitation provision entitled "Certificate of Independent Price Determination," which is a certification that the offer is independent and non-collusive. This FAR certification is not part of the federally required clauses for grantee solicitations because grantees are not subject to the FAR but to the third-party contracting requirements of Federal law and regulations.

However, the Affidavit appears to be a requirement for U.S. Federal Highway Administration (FHWA) assisted contracts.  The Section of the U.S. Code, 23 U.S.C. § 112(c), referred to on the form pertains to "Letting of Contracts" using FHWA funds. This affidavit is not a requirement with respect to Federal Transit Administration assisted contracts. (Revised: October, 2010)

Q. The FTA Helpline used to have a question and answer stating that the Debarment certification is required for contracts over $100K. The BPPM Appendix A says that this has been lowered to $25K. Which is correct?

A. U.S. DOT’s regulatory Debarment and Suspension requirements now apply to third party contracts and subcontracts at any tier of $25,000 or more; and to contracts and subcontracts at any tier of any amount for federally required audit services.  The answer in the FAQ was posted before the 2003 threshold change from $100,000 to $25,000.

As a direct recipient of FTA assistance, you are required to comply with the U.S. Office of Management and Budget, “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. § 180.335, which require recipients of Federal assistance to provide the following information to a Federal agency before entering into a “covered” relationship, such as a grant or contract, with that agency:
Before you enter into a covered transaction at the primary tier, you as the participant must notify the Federal agency office that is entering into the transaction with you, if you know that you or any of the principals for that covered transaction:

(a) Are presently excluded or disqualified;
(b) Have been convicted within the preceding three years of any of the offenses listed in § 180.800(a) or had a civil judgment rendered against you for one of those offenses within that time period;
(c) Are presently indicted for or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses listed in § 180.800(a); or
(d) Have had one or more public transactions (Federal, State, or local) terminated within the preceding three years for cause or default.

In the past, Federal Governmentwide regulations required debarment and suspension information be provided in the form of a certification.  Upon promulgation of the newer U.S. DOT regulations, “Nonprocurement Suspension and Debarment,” 2 C F.R. Part 1200, which adopt and supplement U.S. Office of Management and Budget (U.S. OMB) “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. Part 180, only the information required by the regulations and guidelines was needed, irrespective of form.  This fiscal year, FTA is including a Debarment and Suspension certification in its annual certifications and assurances as a convenient means to obtain the necessary information from its direct recipients of FTA assistance, and also to require the recipient to obtain that information from any third party contractor or subrecipient that seeks a contract of $25,000 or more, or a contract or subcontract at any tier of any amount for federally-required audit services.

Therefore, to assure that your third party contractors and subcontractors are in compliance, you need to include a clause in your RFPs and IFBs requiring prospective contractors and subcontractors to: (1) check the EPLS [U.S. General Services Administration Excluded Parties List System];or (2) collect a certification from that person if allowed by the Federal agency responsible for the transaction; or (3) add a clause or condition to the covered transaction with that person; but also obtain the compliance of lower tier contractors and subcontractors with the U.S. DOT regulations and U.S. OMB guidelines that apply to them. (Revised: October, 2010)

Q. Which FTA certifications must be included in Professional Architectural & Engineering Services Contracts that will be using FTA funds?

A.
There are certifications required specifically for Architectural & Engineering  services contracts.
Upon issuance of U.S. OMB “Guidelines to Agencies on Governmentwide Debarment and Suspension (Nonprocurement),” 2 C.F.R. Part 180, and promulgation of the companion U.S. DOT regulations, “Nonprocurement Suspension and Debarment,” FTA recipients are no longer required to obtain lower tier debarment and suspension certifications from their prospective contractors and subcontractors.  FTA recipients and their contractors and subrecipients, however, must comply with Federal debarment and suspension regulations and guidelines when administering any contract or subcontract  of $25,000 or more, regardless of tier.  Thus contract award may not be made to a prospective contractor or subcontractor if that contractor is excluded or disqualified under the standards of the U.S. DOT regulations and U.S. OMB guidelines, unless the Federal Government has provided an exception as permitted under those regulations and guidelines.  In addition, contracts of any amount for federally-required audit services are also covered by these DOT debarment and suspension regulations and U.S. OMB guidelines.

“Buy America” certifications are required only for contracts of $100,000 or more. See, FTA regulations, “Buy America Requirements,” 49 C.F.R. § 661.7, App. A.
A “Lobbying” certification is required of any person that requests or receives “(2) A subgrant, contract, or subcontract exceeding $100,000 at any tier under a Federal grant;” as provided in U.S. DOT regulations, “New Restrictions on Lobbying,” 49 C.F.R. § 20.110(d)(2).  (Revised: October, 2010)


Q.
Appendix A-1 of the Best Practices Procurement Manual indicates that the "Lobbying requirements apply to Construction/Architectural and Engineering/Acquisition of Rolling Stock/Professional Service Contract/Operational Service Contract/Turnkey contracts." This implies that there are certain types of contracts, for instance the procurement of equipment, materials, or other goods, to which the Lobbying requirements do not apply, even if the contract is for more than $100,000.  What is the source of the limiting language in the BPPM's Appendix A.1?

A. The Best Practices Procurement Manual (BPPM) discusses the Lobbying Certification in section 4.3.3.2.3, where it is made clear that the certification applies to all contracts above $100,000.  In addition, 49 CFR Part 20 makes clear that the lobbying certification applies to all contracts exceeding $100,000.
The language in the BPPM Appendix A.1 was not intended to limit the lobbying certification to the types of procurements listed.
(Revised: October, 2010)


Q. 
Is it acceptable for a grantee/recipient to obtain the required Lobbying Certification and the required Suspension and Debarment Certification from the selected firm after bid/proposal submittal?  Our agency is considering obtaining these certifications prior to contract award. In addition, is the Suspension and Debarment Certification required if our Agency verifies that the awarded/selected firm is not debarred, suspended, proposed for debarment, excluded or disqualified per the Excluded Parties List System (EPLS)?  At a recent APTA Conference, FTA indicated that EPLS verification can be utilized in lieu of the Suspension and Debarment Certification.

A. Since the inception of Government-wide non-procurement suspension and debarment regulations in 1988, recipients of Federal assistance have been required to assure themselves that they did not award a contract of $25,000 or more to any prospective contractor that was debarred or suspended by the Federal Government, unless the Federal Government granted an exception.  Under U.S. DOT's former debarment and suspension regulations, 49 C.F.R. Part 29, Appendix B, recipients were required to obtain a "lower tier certification" from such each prospective contractor seeking to enter into a federally assisted contract that "The prospective lower tier participant certifies, by submission of this proposal, that neither it nor its principals is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction by any Federal department or agency;" or provide an explanation in its proposal.

Upon issuance of U.S. OMB "Guidelines to Agencies on Government-wide Debarment and Suspension (Nonprocurement)," 2 C.F.R. Part 180, and promulgation of the companion U.S. DOT regulations, "Nonprocurement Suspension and Debarment," FTA recipients are no longer required to obtain lower tier debarment and suspension certifications from their prospective contractors and subcontractors.  FTA recipients and their contractors and subrecipients, however, must comply with Federal debarment and suspension regulations and guidelines when administering any contract or subcontract  of $25,000 or more, regardless of tier. Thus contract award may not be made to a prospective contractor or subcontractor if that contractor is excluded or disqualified under the standards of the U.S. DOT regulations and U.S. OMB guidelines, unless the Federal Government has provided an exception as permitted under those regulations and guidelines.  In addition, contracts of any amount for federally-required audit services are also covered by these DOT regulations and U.S. OMB guidelines.  The recipient and third party contractor must also obtain the compliance of lower tier contractors and subcontractors with the U.S. DOT debarment and suspension regulations and U.S. OMB guidelines that apply to them. If you ensure that the prospective contractor is not included on the EPLS, you may award the contract without a Suspension and Debarment certification. The Lobbying and Debarment certifications may be obtained at any time prior to award. (Posted: June, 2011)

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