Alarmed that a computerized database of contractor misdeeds might be used to "blacklist" defense contractors, a major defense industry association is trying to kill legislation that would create the database.
The National Defense Industrial Association (NDIA) is targeting the Contractors and Federal Spending Accountability Act, which is expected to be voted on by the House of Representatives soon.
The act would create a "comprehensive, centralized database" to "track fraudulent federal contractors and prevent them from continuing to do business with the federal government," said Rep. Carolyn Maloney, D-N.Y.
Maloney introduced the legislation last summer and it was passed by the House Oversight and Government Reform Committee in March.
Maloney said the database "would more efficiently monitor the federal procurement system and help protect U.S. taxpayer dollars." She said no such database exists now and federal government watchdogs "lack the information they need to protect taxpayer dollars."
But Lawrence Farrell, president of the NDIA, said the proposed database is unfair. It would list actions taken by the U.S. or state governments against companies, but would not provide companies an opportunity to explain or rebut findings.
As proposed, the database "appears to undermine the fundamental principles of due process," Farrell wrote in a letter to senior members of the House Armed Services Committee and the Appropriations defense subcommittee.
The database would be managed by the General Services Administration on a GSA Web site, and would include information on civil, criminal and administrative proceedings brought against companies by the federal or state governments.
Companies bidding on federal contracts would be required to disclose suspensions and debarments, contract terminations due to default, judgments, orders, decisions and final dispositions of actions taken against them, according to the Congressional Research Service.
Farrell, a retired Air Force general, said the "NDIA fully supports the laudable objective" of maintaining a high level of accountability in federal contracting. But as proposed, the database might "in reality serve as a contractor blacklist."
"The proposed database will not fully explain the nature of the reported data, remedial action instituted by the subject company and the relative severity of cited infractions," Farrell wrote.
"The mere existence of an action … does not automatically equate to substantial corporate wrongdoing," he said.
Maloney said the database is necessary because "contractors that have repeatedly violated federal law can still receive millions of dollars in future contracts from the federal government."
She cited a database created by the Project on Government Oversight (POGO) listing $12 billion worth of fines and penalties paid by the top 50 federal contractors between 1995 and 2006.
The top 10 were defense contractors Lockheed Martin, Boeing, Northrop Grumman, General Dynamics, Raytheon, Halliburton, BAE Systems, United Technologies, L-3 Communications and SAIC.
Farrell said, "we believe that the current suspension and debarment process works."
The Army's Future Combat Systems (FCS) program is ready to test a few components that soldiers may have in their hands by 2010.
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