Federal Debarment and Suspension — Nonprocurement (Grants & Assistance)

Federal debarment and suspension is the mechanism by which the government bars individuals and organizations from receiving federal grants, cooperative agreements, loans, and other financial assistance. The government-wide framework at 2 CFR Part 180 governs nonprocurement transactions — and all exclusions are published to the SAM.gov Exclusions database, which every recipient must check before entering a covered transaction with a subgrantee or partner. A debarment imposed by any one agency bars the excluded party from federal financial assistance government-wide — not just from that agency's programs.

Current Rule (2026)

What This Rule Does

When the federal government discovers that a grant recipient, subgrantee, contractor, or partner has engaged in fraud, has defaulted on federal debts, has been convicted of serious crimes, or otherwise poses a risk to the integrity of federal assistance — it can bar that person or organization from participating in future federal financial assistance programs. 2 CFR Part 180 is the government-wide framework for this exclusion system, covering nonprocurement transactions: grants, cooperative agreements, scholarships, fellowships, loans, subsidies, insurance, and other financial assistance. (Procurement debarment — barring firms from government contracts — is a separate parallel system under FAR 9.4.)

The mechanism is the SAM.gov Exclusions database, which every federal agency and recipient is required to check before making a covered transaction. If a prospective subgrantee or partner appears in SAM.gov Exclusions, the recipient cannot enter a transaction with them — regardless of which agency listed them. The exclusion is government-wide: a debarment by HUD bars the person from EPA grants as well.

The framework distinguishes suspension (an immediate temporary bar while an investigation or legal proceeding is pending — can be imposed quickly, lasts up to 18 months), debarment (a longer-term exclusion, generally up to 3 years, imposed after an agency makes findings), and voluntary exclusion (a negotiated government-wide bar agreed to by the person as part of settling a matter). All three types appear in SAM.gov Exclusions.

The purpose is protective, not punitive. § 180.125 states that debarment and suspension are discretionary measures to protect the federal government's interests — not automatic penalties imposed for misconduct. An agency official must weigh the seriousness of the conduct, remediation steps the organization has taken, and the public interest in the work the organization performs, before imposing exclusion.

Key Provisions

• § 180.125 — Purpose: exclusion protects the public interest and is not a punishment; agencies must weigh benefits of continued participation against risk before excluding
• § 180.130 — Effect of exclusion: an excluded person or entity may not participate in covered nonprocurement transactions (as recipient, subrecipient, principal, or lower-tier participant) during the exclusion period; prohibition applies regardless of which federal agency listed the exclusion
• § 180.135 — Exception authority: the agency head (or designee) may grant a written exception allowing an excluded party to participate in a specific transaction if there is a compelling reason; exceptions must be documented and justified
• § 180.300 — Causes for debarment: conviction of or civil judgment for fraud, bribery, embezzlement related to public transaction; violation of federal antitrust statutes; intentional misrepresentation in public program; record of unsatisfactory performance on federal grants; failure to pay federal taxes or debts; debarment or suspension by another agency; criminal charges indicating a risk to the integrity of federal assistance
• § 180.700 — Suspension: the suspending official may immediately suspend a person when there is adequate evidence of causes for debarment (conviction, indictment, or other adequate evidence) and the public interest requires immediate action; suspension is temporary pending completion of legal proceedings or the debarment process
• § 180.720 — Duration of suspension: suspension may not exceed 18 months unless proceedings have been initiated against the suspended party, in which case the suspension continues until those proceedings are complete
• § 180.865 — Debarment period: generally not to exceed 3 years; exceptions may extend to 5 years for particularly serious or aggravated cases; extensions require new proceedings
• § 180.1015 — Voluntary exclusion: an agency may negotiate a voluntary exclusion as part of settling a matter; the excluded person agrees to a specified period of government-wide exclusion, which is then posted in SAM.gov; can be used when full debarment proceedings aren't warranted
• § 180.220 — Pass-through requirement: recipients of federal assistance must verify that their subrecipients and contractors (for covered transactions) are not excluded before entering agreements; verification is accomplished by checking SAM.gov or obtaining a certification from the lower-tier participant

How It Affects You

If you receive federal grants or cooperative agreements: Before entering any covered transaction with a subrecipient, contractor, or partner — particularly for contracts and subgrants above $25,000 — you are required to verify they are not excluded in SAM.gov. Log your verification (screenshot or printout). If you fail to check and inadvertently fund an excluded party, you may be liable to repay those federal funds. Checking SAM.gov takes minutes; the cost of missing an exclusion is significant.

If you are a subrecipient or subcontractor to a federal grantee: Your prime recipient is required to verify your status. But you should also know your own SAM.gov status — if you are excluded, any agreements you enter with federal grantees during the exclusion period are void and your funding can be clawed back. If you believe you've been listed in error, contact the excluding agency directly.

If your organization is under federal investigation: Suspension can be imposed immediately, before any conviction or final finding, based on adequate evidence. A suspension triggers immediate loss of ability to receive new federal assistance across all agencies — not just the investigating agency. If you learn your organization is being considered for suspension, engage legal counsel immediately; the regulations do allow for submission of information in opposition before the decision is made.

If you are a federal grants officer: Your agency adopts Part 180 by reference and adds its own implementing regulations in the agency-specific subpart below Part 180. Before making an award or approving a subaward, check SAM.gov Exclusions. Document the check. If a suspension or debarment action is warranted, follow Part 180's notice and due-process requirements — the excluded party is entitled to written notice stating the basis and an opportunity to present information in opposition.

Agency-Specific Implementations

Every federal agency that issues grants, cooperative agreements, loans, or other nonprocurement assistance must adopt 2 CFR Part 180 by reference and may add agency-specific provisions. These agency implementations are found in each agency's own title of the CFR, always labeled "Debarment and Suspension (Nonprocurement)." Examples:

• 5 CFR Part 919 — OPM's nonprocurement debarment and suspension (118 sections — applies to OPM grants, cooperative agreements, and other nonprocurement transactions; adopts Part 180 framework; Subpart H — Debarment: 18 sections governing cause, notice, opportunity to present information, decision by debarring official; Subpart G — Suspension: 13 sections for immediate action pending proceedings; Subpart E — Excluded Parties List System: 7 sections on SAM.gov verification obligations and recordkeeping)

• 2 CFR Part 200 — The Uniform Guidance (OMB grants management framework) cross-references Part 180 and requires all federal agencies to include subaward flow-down provisions making Part 180 applicable to recipients' lower-tier transactions

• Other major agency implementations: HHS at 2 CFR Part 376; EPA at 2 CFR Part 1532; USDA at 2 CFR Part 417; Education at 2 CFR Part 3485 — all structured identically under the Part 180 template, differing only in which specific officials hold suspension and debarment authority

• 2 CFR Part 2424 — HUD's nonprocurement debarment and suspension, with two notable HUD-specific additions:

  • Expanded covered transactions (§2424.220): unlike most agencies that follow the government-wide $25,000 threshold, HUD applies nonprocurement debarment/suspension to any contract of $25,000 or more that is paid for or guaranteed with HUD funds — including contracts funded through FHA-insured mortgages, CDBG grants, and HOME Investment Partnerships; this broader scope reflects HUD's extensive role as a behind-the-scenes funder of housing construction and renovation projects
  • Limited Denial of Participation (LDP) (§§2424.1100–2424.1165, Subpart J, 14 sections): the LDP is a HUD-specific enforcement tool with no government-wide equivalent. A HUD field office official can immediately bar a person or organization from participating in HUD-covered programs for up to 12 months — without going through the full debarment proceeding — when there is sufficient evidence of serious violations or misconduct that threatens program integrity. The LDP takes effect immediately upon notice (§2424.1115); the affected person may challenge it by requesting a conference with the issuing official (§2424.1130), but the bar is not stayed during the challenge. LDP actions are reported to SAM.gov once they become final (§2424.1165) but are not coordinated across other federal agencies (§2424.1135) — a state or local recipient with an LDP from HUD is not automatically suspended from EPA or USDA programs. If the same conduct that triggered an LDP later results in a proposed debarment, the debarment proceeding supersedes the LDP (§2424.1150). The LDP fills the gap between an informal agency warning and a full debarment action, and HUD uses it regularly in FHA lender enforcement and CDBG recipient oversight

• 2 CFR Part 3485 — Education Department's nonprocurement debarment and suspension, with a notable Title IV extension: the ED Part 3485 definitions (Subpart I) include postsecondary institutions, lenders, third-party servicers, and guaranty agencies participating in Title IV federal student aid programs as "participants" in covered nonprocurement transactions — meaning that a college, university, lender, or servicer that commits fraud or serious program violations can be debarred or suspended from Title IV participation (access to Pell Grants, Direct Loans, and other federal student aid) using the same framework as any other federal grant recipient; the Suspending and Debarring Official at ED is the Chief Financial Officer (or designee)

• 2 CFR Part 801 — VA's nonprocurement debarment and suspension: the Department of Veterans Affairs adopts the government-wide 2 CFR Part 180 framework for excluding individuals and organizations from VA grants, cooperative agreements, subsidies, and other financial assistance; the Suspending and Debarring Official at VA is the Assistant Secretary for Management; VA's programs subject to nonprocurement debarment include Homeless Veterans programs, VA health care grants, VA-guaranteed loans (where applicable), and VA educational assistance payments to institutions; VA also coordinates with the SAM.gov Exclusions database and must verify that no covered transaction involves an excluded party above the $25,000 threshold

• 2 CFR Part 415 — USDA General Program Administrative Regulations for Grants and Cooperative Agreements: USDA's overarching administrative framework for discretionary grants and cooperative agreements across all USDA agencies; requires free and open competition in all discretionary award decisions (§ 415.1); implements the Executive Order 12372 intergovernmental review requirement (§ 415.10), requiring USDA to provide state and local governments the opportunity to review proposed federal assistance before awards are made; the Secretary must use the intergovernmental review procedures established by each state's single point of contact when applicable; processing rules for state comments require USDA to respond in writing explaining whether it accommodated the state's views (§§ 415.11–415.12)

• 2 CFR Part 1400 — DOI's nonprocurement debarment and suspension: standard 2 CFR Part 180 adoption; DOI-specific provisions designate the Director of the Office of Acquisition and Property Management (PAM) as the Suspending and Debarring Official (§1400.137); the OIG's Administrative Remedies Division (ARD) is responsible for drafting and submitting referral memoranda when OIG investigations identify debarment-worthy conduct (§1400.1012); formal record requirements specify the documents that constitute the official debarment file (§1400.1013)

• 2 CFR Part 2700 — SBA Nonprocurement Debarment and Suspension: Small Business Administration implementation of 2 CFR Part 180 for SBA's financial assistance programs including Small Business Investment Company (SBIC) investments, SBIR/STTR grants, 8(a) Business Development program financial assistance, surety bond guarantees, and SBA disaster loans; the Suspending and Debarring Official for SBA financial assistance is the Director of the Office of Financial Assistance (§ 2700.1010); designated senior officials may authorize exceptions allowing excluded parties to participate in specific SBA covered transactions when compelling reasons exist (§ 2700.137); the exclusion verification requirement applies to all SBA nonprocurement transactions including SBIC portfolio company investments, where the $25,000 threshold would apply to covered financial assistance flows

• 2 CFR Part 1600 — DFC Nonprocurement Debarment and Suspension: U.S. International Development Finance Corporation (DFC) implementation of 2 CFR Part 180 for DFC's development finance instruments; DFC's programs include direct loans, loan guarantees, equity investments, and political risk insurance supporting private investment in developing countries; the Suspending and Debarring Official is the DFC Vice President and Chief Administrative Officer (§ 1600.1010); the CEO of DFC, or a CEO-designated official, may authorize exceptions for excluded parties in specific transactions (§ 1600.137); all DFC covered transactions with private entities are subject to SAM.gov exclusion verification — including DFC-guaranteed loans where the ultimate beneficiary is a private entity in a developing country

• 2 CFR Part 1125 — DOD Nonprocurement Debarment and Suspension: Department of Defense implementation of 2 CFR Part 180 for DOD grants, cooperative agreements, and other nonprocurement transactions including research grants to universities, educational partnership agreements, and technology transfer assistance; the Suspending and Debarring Officials for DOD nonprocurement transactions are the same officials authorized for DOD procurement suspension and debarment — senior acquisition officials in each Military Department and DOD Component (§ 1125.1010); Part 1125 does not apply to Other Transaction Authority (OTA) prototype projects under 10 U.S.C. § 4022; the Secretary of Defense, Service Secretaries, and other designated officials may grant exceptions for excluded parties participating in specific DOD covered transactions (§ 1125.137)

• 2 CFR Part 5800 — EAC Nonprocurement Debarment and Suspension: Election Assistance Commission implementation of 2 CFR Part 180 for EAC's grant programs, primarily Help America Vote Act (HAVA) grants to states for election administration improvements and election security; the Suspending and Debarring Official is the EAC Contracting Officer, with the Chief Financial Officer as backup (§ 5800.1010); exceptions for excluded parties require approval from the EAC Contracting Officer (§ 5800.137); subcontracts of $25,000 or more funded through HAVA grants are covered transactions subject to exclusion verification (§ 5800.220); states administering HAVA grants must verify that their contractors and subgrantees are not excluded in SAM.gov before making awards

• 2 CFR Part 901 — DOE Nonprocurement Debarment and Suspension: Department of Energy implementation of 2 CFR Part 180 for DOE grants, cooperative agreements, loans, and other nonprocurement financial assistance; DOE's programs subject to nonprocurement debarment include DOE research grants to universities and national laboratories, energy efficiency incentive programs, Office of Science grants, and Loan Programs Office financial assistance; the Suspending and Debarring Official for DOE (excluding the National Nuclear Security Administration) is the Director of the Office of Procurement and Assistance Management (§ 901.1010); for NNSA programs, the SDO is the Director of the Office of Acquisition and Supply Management, NNSA; exceptions allowing excluded parties to participate in specific covered transactions require written approval from the relevant SDO, with written justification explaining the departure from the government-wide policy (§ 901.137); DOE's dual-SDO structure reflects NNSA's semi-autonomous status within DOE — NNSA was established by the FY2000 NDAA as a separately organized agency within DOE to oversee nuclear weapons programs, and its SDO has independent authority over NNSA financial assistance

Statutory Authority

This rule implements:

• 31 U.S.C. § 6307 — Authorizes executive agencies to debar or suspend persons from participation in programs involving federal financial assistance
• 31 U.S.C. § 503 — General authority for OMB to establish government-wide management policies for federal financial assistance
• 31 U.S.C. § 6102 — OMB authority over the grants management framework, including policies on recipient accountability

Recent Rulemakings

• 85 FR 72925 (November 2020) — Most recent significant update; harmonized Part 180 with the broader 2 CFR grants reform (Uniform Guidance 2 CFR Part 200); clarified the definition of covered transactions, updated the threshold for lower-tier participant verification ($25,000), and aligned the voluntary exclusion process with current SAM.gov capabilities
• 72 FR 54945 (2007) — Earlier comprehensive revision that established the current structure of Part 180 as the government-wide nonprocurement framework, replacing the earlier individual agency nonprocurement debarment rules that predated the 2 CFR consolidation. The pre-2007 agency-specific nonprocurement debarment and suspension rules — including 22 CFR Part 1006 (Inter-American Foundation), 22 CFR Part 1508 (U.S. African Development Foundation), 29 CFR Part 1471 (Federal Mediation and Conciliation Service), 31 CFR Part 19 (Treasury), and 41 CFR Part 105-68 (GSA) — established each agency's individual debarment framework using identical structure and substantive standards; these rules have been largely superseded by the 2 CFR Part 180 framework but may remain in the CFR as regulatory text for legacy transactions

Recent Developments

• DEI-related debarment considerations (2025): The Trump administration's January 2025 executive orders directing federal agencies to terminate DEI programs and funding raised questions about whether organizations that maintain DEI practices could face exclusion actions under Part 180. OMB guidance to agencies framed DEI program continuation by federal grantees as a potential violation of federal nondiscrimination requirements, which are standard assurances in most federal grant agreements. Debarment proceedings based on DEI program maintenance had not been formally initiated as of mid-2026, but the legal framing created compliance uncertainty for nonprofit and university grantees.
• SAM.gov and exclusion database modernization: The System for Award Management (SAM.gov) serves as the central exclusion database under Part 180, and GSA has continued improving its user interface, data quality, and API integration for automated exclusion checking. Federal agencies, state agencies administering federal grants, and private-sector prime contractors all rely on SAM.gov exclusion records. System outages and data refresh delays have been documented as operational risks in large-scale procurement.
• COVID-19 fraud and suspension/debarment: Federal law enforcement identified significant COVID-19 relief program fraud across PPP, EIDL, and pandemic unemployment programs. DOJ and agency Offices of Inspector General initiated a wave of debarment referrals based on fraud convictions and civil judgments from COVID-era cases. These referrals are working through the suspension/debarment process at multiple agencies, resulting in exclusions that affect contractors and grantees across industries.
• Interagency suspension and debarment committee: The Interagency Suspension and Debarment Committee (ISDC) coordinates government-wide debarment policy and publishes annual reports on suspension and debarment activity. ISDC metrics show that debarment caseloads have increased, particularly in healthcare fraud, defense contractor fraud, and housing program fraud. ISDC guidance has emphasized faster suspension processing — getting temporary exclusions in place while debarment proceedings are completed — for egregious fraud cases.

Pending Action

The DEI executive order's intersection with suspension/debarment authorities remains legally unresolved. OMB and agency general counsel offices are working through whether DEI program maintenance by grantees and contractors constitutes a violation of standard assurances that could trigger cause-based debarment under Part 180. Formal ISDC guidance on this question is expected but had not been published as of mid-2026. Separately, the COVID-19 fraud debarment pipeline will continue producing exclusion determinations through 2026–2027 as criminal and civil proceedings work through the courts. Organizations with concerns about their exclusion status should verify SAM.gov records regularly and consult agency Suspending and Debarring Officials (SDOs) for guidance on the current enforcement climate.