In last week’s edition of the SmallGovCon Week In Review, we referenced a FAR update that has important ramifications for prospective small business government contractors. This rule is potentially important enough that we figured it deserved its own stand-alone SmallGovCon post.
So what’s so important about this new rule? In a nutshell, it clarifies that offerors must be registered in SAM at the time of bid submission to be considered for an award.
One of the first things a prospective government contractor (including a joint venture) must do to be eligible for an award is to create a business profile in the System for Award Management (or “SAM”). Before making an award, in fact, the contracting officer is obligated to verify the prospective contractor is registered in SAM.
Not only must a business be registered in SAM, but its registration should be up-to-date. It’s an enduring myth of government contracting that a business’s SAM profile only has to be updated annually. But as FAR 4.1201(b)(1) instructs, an offeror’s SAM profile has to be updated as necessary to ensure that it is “kept current, accurate, and complete.”
What happens if a prospective awardee fails to update its SAM profile? Can a disappointed bidder challenge the basis of the award? The answer, according to GAO, is “it depends.”
There is no cost to register in SAM or other government contracting databases–but that hasn’t stopped some companies from charging would-be contractors hefty fees for assistance in the registration process. Some of these companies are out-and-out frauds, like the Tampa firm whose owner recently pleaded guilty to wire fraud in a FEMA registration scheme. And others, while not fraudulent, still often neglect to mention an important (but for them, inconvenient) fact: government contracts registration assistance is available for free through Procurement Technical Assistance Centers and other reputable sources.
Now, a bipartisan new Senate bill aims to get the word out about the free registration assistance available to prospective contractors.
Government contractors who have attempted to recently register or re-register in the SAM database have been confronted with new questions asking about an “immediate owner” and a “higher-level owner.” These new SAM questions have caused some confusion about what information, if any, a contractor must provide in SAM with respect to an “immediate owner” or “higher-level owner.”
The new questions originate in a recent amendment to the FAR, which requires all SAM registrants, if owned by another entity, to identify that entity by legal name, CAGE code, and type of ownership. This blog post breaks down the new rule and explains when this rule will come into play.