Wis. Admin. Code Department of Transportation Trans 504.05 - Debarment

(1) GENERAL.

(a) The department may, in the public interest, debar a contractor for any of the causes contained in sub. (2), using the procedures in sub. (3). The existence of a cause for debarment as specified in sub. (2), however, shall not necessarily require that a contractor be debarred; the seriousness of any contractor's acts or omissions and any mitigating factors shall be considered in making any debarment decision.

(b) Debarment of a contractor constitutes debarment of all divisions or other organizational elements of the debarred contractor, unless the debarment is explicitly limited to specific divisions, organizational elements or commodities.

(c) The department may extend the debarment to include any affiliates of a debarred contractor, if the affiliates are specifically named and are given written notice of the proposed debarment and an opportunity to respond pursuant to sub. (4).

(d) When no suspension is in effect pursuant to s. Trans 504.06 at the time the department contemplates debarment of a contractor, no contracts shall be awarded to, and no subcontracts shall be approved for, the contractor, pending a debarment decision by the department.

(2) CAUSES FOR DEBARMENT. The secretary may debar a contractor for any one or more of the following causes:

(a) Conviction, civil judgment or admission of:

1. Fraud, collusion or any criminal offense in connection with obtaining, attempting to obtain or performing a public contract or subcontract;

2. Violation of any federal or state antitrust statute relating to the submission of bids or proposals;

3. Embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, receiving stolen property or obstruction of justice; or

4. Any other offense indicating a lack of business integrity or of business honesty which offense seriously and directly affects the responsibility of the contractor or subcontractor.

(b) Violation of the terms of any government contract or subcontract when that violation is so serious as to justify debarment, including:

1. Willful failure to perform in accordance with a contract; or

2. A history of failure to perform or of unsatisfactory performance of one or more contracts.

(c) Any other cause that is so serious or compelling that it affects the responsibility of a contractor or subcontractor.

(d) Debarment for any of the above causes listed in pars. (a) through (c) by another state or federal entity.

(3) PROCEDURES FOR DEBARMENT.

(a) Referral. Department employees and all other persons having information appropriate for department consideration under this section shall promptly report that information to the secretary.

(b) Decision-making process.

1. The debarment decision-making process shall be as informal as practicable, consistent with fundamental due process of law principles. The debarment decision-making process shall permit contractors and any specifically named affiliates to submit information and arguments in opposition to a proposed debarment. The department may require that a contractor's opposition be submitted in writing or may permit an oral presentation in person or through a representative.

2. Whenever a proposal to debar is based upon a conviction, judgment or debarment by another state or federal entity for any of the causes listed in sub. (2), the department need not conduct a fact-finding hearing.

3. Whenever a proposal to debar is not based upon a conviction, judgment, admission or debarment by another state or federal entity, and if the department finds that the contractor's opposition raises a genuine dispute over facts relevant to the proposed debarment, the department shall conduct a fact-finding hearing. A department hearing examiner shall:

a. Permit the contractor to appear with counsel, to submit documents, to present witnesses and to confront and cross-examine any person the department presents;

b. Ensure that a transcript of the hearing is prepared and made available to the contractor at a reasonable cost, unless the contractor and the department mutually waive the transcript requirement; and

c. Act in accord with and have the authority provided by s. 227.46, Stats.

(4) NOTICE OF PROPOSAL TO DEBAR. The department shall initiate a debarment proceeding by informing the involved contractor and any specifically named affiliate by certified mail return receipt requested. The mailed notice shall state:

(a) That the department is considering a debarment;

(b) The reasons for the proposed debarment in terms sufficient to notify the contractor of the conduct or transaction upon which debarment is proposed;

(c) The cause or causes under sub. (2) that the department relies upon for the proposed debarment;

(d) That the contractor may submit, within 15 days of the date of the department's mailed notice, a written response providing information or argument in opposition to the proposed debarment;

(e) The department's procedures governing debarment decision-making as specified in sub. (5);

(f) The potential effect of the proposed debarment as provided under s. Trans 504.04; and

(g) That pending a debarment decision, no contract will be awarded to, and no subcontracts will be approved for, the contractor.

(5) DEPARTMENT'S DEBARMENT DECISION.

(a) In debarment actions based upon a conviction, judgment, or admission or upon debarment by another state or federal entity for any of the causes listed in sub. (2) or in debarment actions in which no dispute exists over facts relevant to the proposed debarment, the secretary shall make a debarment decision based upon the information in the administrative record, including any submission made by the affected contractor. If no suspension is in effect under s. Trans 504.06, the debarment decision shall be made within 30 days after the secretary receives the last written response providing information or argument in opposition to the proposed debarment as provided for in sub. (4) (d).

(b) In debarment actions in which a fact-finding hearing is necessary under sub. (3) (b) 3., the designated hearing examiner shall prepare written findings of fact, and the secretary or designee shall render a debarment decision based upon those written findings of fact. A cause for debarment must be established by a preponderance of the evidence. The debarment decision shall by made after the conclusion of the proceedings with respect to the disputed facts.

(6) NOTICE OF DEPARTMENT DECISION.

(a) If debarment is imposed, the department shall promptly notify the contractor and any affiliates involved by certified mail return receipt requested. The notice shall contain the following:

1. Reference to the notice of proposed debarment that initiated the action under sub. (4);

2. Reasons for debarment; and

3. Period of debarment, specifying the effective date.

(b) If debarment is not imposed, the department shall give prompt notice of that fact to the contractor and any affiliates involved by certified mail return receipt requested.

(7) PERIOD OF DEBARMENT.

(a) Debarments shall be for a period commensurate with the seriousness of the cause or causes for debarment. Generally, debarment shall not exceed 3 years. If suspension precedes a debarment, the suspension period shall be considered in determining the debarment period.

(b) The department may extend the debarment for an additional period if the department determines that an extension is necessary to protect the public interest. However, an extension may not be based solely on the facts and circumstances upon which the initial debarment was based. If an extension is proposed, the procedures in sub. (3) above shall be followed to extend the debarment.

(c) The department may terminate a debarment or may reduce the period or extent of a debarment, upon the contractor's request, for reasons considered appropriate by the department, such as:

1. Newly discovered relevant evidence;

2. Reversal of the conviction or judgment upon which debarment was based;

3. A bona fide change in ownership or management of the contractor; or

4. Elimination of the cause or causes for which debarment was imposed.

(8) IMPUTED CONDUCT.

(a) The fraudulent, criminal or other seriously improper conduct of any officer, director, shareholder, partner, employee or other individual associated with a contractor may be imputed to the contractor when the conduct occurred in connection with the individual's performance of duties for or on behalf of the contractor, or with the contractor's knowledge, approval or acquiescence. The contractor's acceptance of the benefits derived from the conduct shall be evidence of the contractor's knowledge, approval or acquiescence.

(b) The fraudulent, criminal or other seriously improper conduct of a contractor may be imputed to any officer, director, shareholder, partner, employee or other individual associated with the contractor who participated in, knew of or had reason to know of the contractor's conduct.

(c) The fraudulent, criminal or other seriously improper conduct of one contractor participating in a joint venture or similar arrangement may be imputed to other participating contractors if the conduct occurred for or on behalf of the joint venture or similar arrangement or with the knowledge, approval or acquiescence of those contractors. Acceptance of the benefits derived from the conduct shall be evidence of the contractor's knowledge, approval or acquiescence.

Notes

Wis. Admin. Code Department of Transportation Trans 504.05

Cr. Register, December, 1983, No. 336, eff. 1-1-84; correction in (3) (b) 3. c. made under s. 13.92(4) (b) 7, Stats., Register March 2012 No. 675.