As we have previously discussed, government contractors generally must maintain System of Award Management (SAM) registration from the time the contractor makes an offer or quotation, at the time of the award, during performance, and through final payment of the agreement or contract. Failure to maintain SAM registration from offer through award could render a contractor ineligible to receive a contract. A Federal Claims Court judge recently clarified that this rule takes effect only once a contractor has submitted a final proposal in response to government solicitations.

In Hanford Tank Disposition Alliance, LLC (HTDA) v. United States, the U.S. Court of Federal Claims ruled that Hanford Tank Waste Operations & Closure, LLC (H2C), could be awarded a $45 billion environmental cleanup contract from the Department of Energy, despite H2C’s prior lapse in SAM registration.

In an earlier 2023 case, the court had ruled that H2C’s registration lapse prohibited that company from being awarded the contract. Following that ruling, the DOE issued a Class Deviation—an immediate change to agency acquisition policy outside of formal rulemaking—that permitted its officers to waive SAM registration lapses. Then the DOE issued a corrective action and sought new proposals in response to its amended solicitation for the contract. When H2C was again awarded the contract, HTDA protested, and claimed that H2C’s earlier disqualification should have permanently disqualified it from the disputed procurement, because the SAM registration requirement applies from the time of “initial proposal submission until contract award.” HTDA also argued the class deviation had been intended only to benefit H2C, and was therefore improper.

The court declined to rule on the validity of the class deviation because H2C’s SAM registration was continuous for the relevant time period regardless of the deviation. The court ruled that H2C required continuous SAM registration starting only from the time it filed a response to DOE’s amended offer. The court noted that Federal Acquisition Regulation 2.101 defines an “offer” as “a response to a solicitation that, if accepted, would bind the offeror to perform the resultant contract.” The court further noted that, when an agency amends its solicitation and receives revised offers, earlier proposals become invalid. It explained that:

[A]fter the Department of Energy issued the corrective action and received new proposals, the agency could no longer evaluate the earlier submitted proposals, make a best value determination or award a contract based on those earlier submitted proposals submitted before the corrective action. Therefore, the only proposals before the agency were the October 23, 2023 revised proposals from both offerors.

Because H2C had submitted a revised offer on October 23, 2023, following the corrective action and amended solicitation, the court held that H2C only had to register in SAM from that date onward, rather than maintain continuous registration from its initial proposal. Because neither party disputed that H2C had maintained continuous SAM registration from the time of its revised proposal, the award was proper, and HTDA’s protest was dismissed.

The court did analyze the revised offer, however, to verify it was truly different from the original proposal. Likewise, because a proposal is only an “offer” if its acceptance would bind the offeror to perform the resulting contract, the court noted that an initial proposal may not always count as an offer for SAM registration purposes. For example, if a solicitation functions in phases, SAM registration may be required only for the solicitation’s final phase.

Nevertheless, though the DOE had issued class deviations that permitted contracting officers to consider efforts by a contractor to maintain or establish its SAM.gov registration, it will always be a best practice for contractors to maintain SAM registration diligently to protect their eligibility to receive government contracting awards.

This article summarizes aspects of the law and does not constitute legal advice. For legal advice with regard to your situation, you should contact an attorney.