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Posted by on Mar 21, 2013

House Committee Approves Bill to Limit Grant Awards to Delinquent Taxpayers

The House Oversight and Government Reform Committee approved a bill yesterday that would limit an agency from awarding a grant if a recipient is delinquent in paying federal taxes. The Contracting and Tax Accountability Act of 2013, H.R. 882, would require grant applicants to submit a certification indicating whether they have fully paid their federal taxes. Federal agencies would be required to initiate debarment procedures against recipients that file false certificates or are found to have serious delinquent tax debt. The language in the bill would allow agencies to award a grant to a recipient with tax debt, but the agency would be required to designate the recipient as high-risk.

In recent years, Congress has passed numerous laws to reduce waste, fraud, and abuse of federal taxpayer dollars and hold grant recipients more accountable for their awards. This bill is seen as a continuation of that policy. The primary goal of this legislation is to prevent businesses from receiving contract awards if they have not paid their federal taxes. While grant awards are included in the legislation, the practical effect on grant recipients may be minimal, as a large percentage of recipients are tax-exempt entities or non-federal government entities.

It is not clear when, or if, the House will vote on the bill.  For more information on the bill, including the text, click here.

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