(a) DARS or HHSC may suspend a contractor's or potential contractor's contractual rights whenever DARS or HHSC finds that there is a reasonable basis to believe that grounds for debarment exist. Suspension may be imposed immediately following DARS' or HHSC's notification to a contractor or potential contractor. In addition, suspension may be imposed on a potential contractor if the contractor has an outstanding indictment or DARS or HHSC has information about an offense that is grounds for indictment.
(b) The conditions of suspension are:
  (1) DARS or HHSC may withhold payments, wholly or partly, to the affected contractor during the period of suspension.
  (2) DARS or HHSC may refuse to accept a bid, offer, application, or proposal from, or to award a contract to, the affected potential contractor during the period of suspension.
  (3) DARS or HHSC may cease referrals of additional consumers to the suspended entity and may transfer existing consumers to other contractors.
(c) If DARS or HHSC determines that the underlying reasons for suspension have been resolved in favor of the contractor, DARS or HHSC must, if applicable:
  (1) pay the withheld payments for any services that were provided during the suspension and that met the terms of an existing contract; and
  (2) resume contract payments and consumer referrals.
(d) If DARS or HHSC determines that underlying reasons for the suspension have not been resolved in favor of the contractor, DARS or HHSC institutes debarment proceedings.
(e) In accordance with terms specified by DARS or HHSC, individuals and entities whose contractual rights have been placed in suspension may not:
  (1) receive a contract;
  (2) submit an offer, bid, application, or proposal for a contract; or
  (3) provide goods or services to DARS or HHSC consumers either directly or indirectly while working for a DARS contractor.
(f) A suspension may be applied against an individual, an entire legal entity, or a specified part of a legal entity.

Source Note: The provisions of this §392.323 adopted to be effective June 17, 2015, 40 TexReg 3638