Overview
Subpart 3.8 implements 31 U.S.C. 1352 (commonly known as the "Byrd Amendment"), which prohibits the use of federally appropriated funds to influence or lobby Executive or Legislative branch officials in connection with specific federal awards. It establishes the mandatory certification and disclosure requirements for contractors to ensure transparency regarding payments made to influence federal contracting actions.
Key Rules
- The Prohibition: Recipients of federal contracts, grants, or loans are strictly prohibited from using appropriated funds to pay any person for "influencing or attempting to influence" government officials regarding the award or modification of a contract.
- Threshold for Compliance: The requirements for certifications and disclosures apply to all solicitations and contracts expected to exceed $200,000.
- Appropriated Funds vs. Profit: The prohibition applies only to "appropriated funds." It does not include the profit or fee earned from a federal contract. If a contractor can demonstrate they have sufficient non-federal funds, the government assumes lobbying activities were paid for from those private sources.
- Certification and Disclosure: Offerors must provide a declaration (via FAR 52.203-11) certifying compliance and a disclosure (via FAR 52.203-12) if any payments were made using non-appropriated funds to influence the transaction.
- Exceptions for Reasonable Compensation:
- Agency/Legislative Liaison: Payments to a contractor's own "regularly employed" officials (employed for at least 130 days) for general liaison activities not related to a specific action are permitted.
- Professional/Technical Services: Payments for legal, engineering, or technical services are permitted if they are directly related to the preparation or negotiation of a bid/proposal, provided the service is a professional discipline and not mere advocacy.
Responsibilities
- Contracting Officers (CO):
- Must insert FAR provisions 52.203-11 and 52.203-12 in solicitations and contracts exceeding $200,000.
- Must obtain required certifications and disclosures from offerors prior to award.
- Responsible for reporting suspected violations of the statutory prohibition through agency channels.
- Offerors/Contractors:
- Must certify that no appropriated funds have been or will be paid for prohibited lobbying activities.
- Must disclose any lobbying activities paid for with non-appropriated funds.
- Must flow down these requirements to subcontractors.
- Secretary of Defense:
- Holds the unique authority to exempt specific "covered Federal actions" from these prohibitions on a case-by-case basis if it is in the national interest (requires notification to Congress).
- Federal Agencies:
- Required to impose and collect civil penalties for violations under the Program Fraud and Civil Remedies Act.
Practical Implications
- The "Lobbyist" vs. "Technical Expert" Distinction: In the real world, the line between a technical consultant and a lobbyist is thin. A lawyer drafting a legal response for a proposal is providing an exempt professional service; however, if that same lawyer meets with a Member of Congress to "advocate" for the award without providing specific legal analysis, the payment for that time must be disclosed and cannot come from appropriated funds.
- Accounting Isolation: Contractors must maintain rigorous accounting practices to prove that any lobbying or influence-related expenses were paid out of corporate profit or private investment rather than direct or indirect costs charged to the government.
- Subcontractor Oversight: Large prime contractors are at risk if their subcontractors engage in prohibited lobbying. Primes must ensure their subcontractors understand that "appropriated funds" passed down to them cannot be used to influence the government.
- Pre-Solicitation Communications: Engaging in technical demonstrations or responding to Market Research/RFIs is generally exempt, provided the communication focuses on product characteristics and agency needs rather than specific "intent to influence" a pending award.