Department of Energy Issues Class Deviation on System of Award Management (SAM)

Contractors are required to keep their System of Award Management (SAM) registration up to date. FAR 52.204-7(b)(1) requires an offeror to be registered in the System of Award Management (SAM) when submitting an offer/quote, registered until the time of award, during performance, and through final payment. Sounds pretty easy. However, contractors are not always registering or updating their registration, resulting in ineligible awards, as noted in recent court cases (See our blog: SAM Registrations: Check Often and Never Let it Lapse!).

Is There a DOE Class Deviation?

On September 6, 2023, DOE issued a Class Deviation removing the FAR 52.204-7 requirement that a contractor maintain its SAM registration for the entire time from proposal submission until contract award, without any lapse.

The DOE deviation is effective immediately for all DOE procurements:

• Removes the “shall continue to be registered until” time of award language; and
• Adds the following language: “A failure to register in SAM or a lapse in SAMs registration may be treated by the Contracting Officer as a correctable matter of responsibility.”

The Contracting Officer will have the authority to make a reasonable determination in documenting the validity of SAM registrations at the time of offer or quotation submission and at the time of award.

This is great, but this class deviation applies only to DOE procurements. Other Federal agencies are still holding contractors to FAR 52.204-7 requirements.

Where Did This Class Deviation Come From?

We aren’t sure, but GAO made decisions in two protests (Vietnam-Australia Environment Joint Stock Co. and Master Pavement Line Corporation) that a lack of a current SAM registration constitutes an immaterial defect and can be corrected. GAO’s decision in both sealed bid cases was based on the provisions of FAR 14.405, which provide that if a bid contains a minor informality or irregularity, the contracting officer shall either give the bidder an opportunity to cure the deficiency or waive the deficiency, whichever is to the advantage of the Government.  GAO states a defect is immaterial when it has a negligible effect on price, quantity, quality, or delivery. While FAR subpart 14 doesn’t apply to all procurements, DOE’s class deviation appears to be using the same thought process – that it is a correctable deficiency.

Takeaways

Companies must maintain active SAM registrations and update existing registrations well before expiration. There may be changes to banking information, employee contacts, or representations and certifications. Redstone recommends contractors set up reminders and designate an individual to track the registration expiration date. Renewing your SAM.gov account requires review and approval, so that the process may take up to 60 days. Don’t get caught investing time and resources in putting together and submitting an offer that is determined ineligible because the SAM registration wasn’t completed or expired during the process. Although the two contractors that submitted sealed bids won the protest, they incurred significant internal and legal costs.

Redstone is hopeful that other agencies will follow DOE and issue similar deviations, but until then, contractors should keep their SAM registrations current.

Redstone GCI assists contractors throughout the U.S. and internationally with understanding the Government’s requirements and implementing adequate systems, including the necessary policies and procedures. We can assist companies in setting up or updating their System of Award Management Registration. We would be happy to be part of your team.