This Act prohibits the federal government from awarding contracts or grants to special government employees or their closely affiliated third parties, with an exception for those serving only on advisory committees.
Kathy Castor
Representative
FL-14
The Employee Limits ON Profiteering Act prohibits the federal government from awarding contracts or grants to "special Government employees" or closely associated third parties. This restriction aims to prevent conflicts of interest arising from federal funding. An exception is made for special Government employees who serve solely on advisory committees. The Federal Acquisition Regulation must be updated to reflect these new limitations.
Ethics Bill Blocks Temporary Federal Employees and Their Businesses From Landing Government Contracts
The “Employee Limits ON Profiteering Act” is a straightforward bill designed to tighten up the ethical guardrails around temporary federal workers. Essentially, this legislation says that if you are a “special Government employee” (SGE), you and your closely tied businesses can’t receive a “Federal award”—which covers contracts, grants, or cooperative agreements—from the government you are advising.
Who Gets Cut Off?
This isn't aimed at full-time federal employees; it targets the SGEs defined under Title 18, Section 202 of the U.S. Code. These are typically experts brought in temporarily to consult or perform specific, short-term duties. The bill aims to prevent a situation where someone is advising the government on policy one day and then receiving a lucrative contract from that same agency the next. The prohibition extends to any “covered third party,” meaning your spouse, child, or general partner, as well as any organization where the SGE is an officer, director, or even an employee. If you’re a consultant serving the government part-time, your firm is now likely shut out of competing for federal contracts.
The Advisory Committee Carve-Out
There is one major exception, and it’s a big one: If the special Government employee only serves on an advisory committee—defined by Title 5, Section 1001—the prohibition doesn’t apply. They, and their businesses, can still pursue federal awards. This means that if you’re a CEO sitting on a panel that advises the Department of Energy on long-term strategy, you’re fine. But if you’re brought in for a specific, non-advisory task force for a few months, you and your business network are excluded from federal work.
The Real-World Impact on Expertise
For the average taxpayer, this bill is a win for transparency, reducing the potential for conflicts of interest where temporary government advisors might steer policy to benefit their own bottom line. However, the cost might be access to top-tier expertise. The government often relies on SGEs who are leaders in their fields—like tech, engineering, or finance—who often run companies that are the very ones best suited to win federal contracts or grants. This law forces them to choose: serve the government in a non-advisory capacity, or keep their business eligible for federal funding. The law requires the Federal Acquisition Regulation (FAR), which governs all federal purchasing, to be updated within a brisk 60 days to reflect these new rules, which is a tight turnaround for such a complex change.