Facility Clearance (FCL) Termination
The FCL remains in effect until terminated by either the government or the contractor in accordance with Section IV of DD Form 441 (Department of Defense Security Agreement). The Department of Defense Security Agreement is an agreement between your organization and the United States Government that details the security responsibilities of both the cleared organization and the United States Government.
This Agreement shall remain in effect until terminated through the giving of 30 days' written notice to the other party of intention to terminate; provided, however, notwithstanding any such termination, the terms and conditions of this Agreement shall continue in effect so long as the Contractor possesses classified information. If the FCL is terminated for any reason, the contractor shall return all classified material in its possession to the appropriate GCA (Government Contracting Activity) or dispose of the material as instructed by the CSA (Cognizant Security Agency). NISPOM 2-110
After coordination with the Field Office Chief (FOC), the IS Rep can initiate action to terminate an FCL if the contractor has not conducted classified activity in the preceding 12 months. Before terminating the FCL, the IS Rep will send the contractor a notice of intent to terminate the FCL in 30 days from the date of the letter. A pending, verifiable and legitimate requirement for the company to need access to classified information constitutes justification for retaining the FCL. The IS Rep should request information regarding the pending requirement for access to classified information and may verify the requirement with the GCA.
The FCL termination process begins with the IS Rep. The IS Rep needs approval from the FOC (Field Office Chief). The FOC needs to sign off on the termination request from the IS Rep. Note one thing, however, most FOCs will not sign off on an IS Rep’s FCL recommendation because it causes many complaints and legal inquiries from the FCL-terminated contractor. Some FOCs just don’t want any “commotion on their watch” because they then have to be accountable to their boss, the Regional Director (RD). Often, FOCs will just look the other way when some contractors do not have classified contract work. Other times, they will grant an extension to the contractor allowing the contractor more time to find and secure classified contract work, thus justifying their right to keep their FCL.
If your company is about to have its FCL terminated, a typical letter from your local Defense Security Service (DSS) Field Office would be similar to the following:
The IS Rep may also, at the written request of the contractor, terminate the FCL at any time if the contractor does not have a current or pending requirement for access to classified information.
Contractors that have possessed classified material within the preceding 12 months will require an on-site closeout visit to ensure that the contractor has properly disposed of its classified material. Non-possessing contractors may or may not require an on-site closeout visit, depending on the IS Rep’s evaluation of the facility’s security posture and length of time since the last evaluation. In all cases, the IS Rep will advise the contractor of the requirements for retaining security records and other security requirements.
When the contractor refuses to dispose of classified information in its possession, the IS Rep will notify the security, law enforcement or contracting offices of the GCA and request appropriate action be taken by the GCA to recover the classified information
Upon FCL termination, the IS Rep will notify the Facility Clearance Division (FCD) who will update the Industrial Security Facilities Database (ISFD) with the termination.
For more information regarding FCLs (Facility Security Clearances), go to the following website: https://www.dss.mil/.
When a cleared contractor successfully appeals its proposed FCL termination to the Defense Security Service (DSS), Director of Industrial Security Field Operations (ISFO), the cleared contractor would receive the following type of correspondence:
The contractor will also, most likely, receive a follow-up letter from the DSS Facilities Clearance Branch (FCB). The Defense Security Service (DSS) Facility Clearance Branch (FCB) processes contractors for Facility Clearance (FCL) based upon procurement need, issues FCL's and monitors the contractors continued eligibility in the NISP.
The bottom line is that DSS terminates FCLs of companies that have not had a classified contract for a period of 1 year. They just don't let companies keep FCLs indefinitely. It's like a culling process for classified contractors. Companies with no classified work either as a Prime Contractor or a Sub-Contractor to the Prime Contractor for a 1 year period are purged from the DSS National Industrial Security Program. It's a money thing for DSS to keep inactive companies on their information systems and in the rotation for security reviews by industrial security reps.
On a positive note, if your company secures classified contract work as a Prime or Sub in the near future, DSS already has your company's information and it will not take long to get your FCL reinstated. Additionally, all of your KMPs (Key Management Personnel), will still have their security clearances in a CURRENT status. That too will make getting back your company’s FCL much, much quicker.