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New Requirement for SAM Registration Could Delay Contractor Payments - Act Early

Client Alert

Author: Hilary S. Cairnie

6/06/2018
New Requirement for SAM Registration Could Delay Contractor Payments - Act Early

On April 27, the General Services Administration (GSA) made effective a requirement for contractors to submit a notarized letter identifying and appointing the individual authorized to access the contractor’s registration account on the System for Award Management (SAM) — the governmentwide database on which all contractors must be registered. Currently, the GSA is seriously backlogged with authorization letters submitted by contractors as part of their annual SAM renewals. According to the GSA, the backlog is delaying the processing of notification letters, and, until the GSA processes a contractor’s authorization letter, other agencies may be delayed in processing and approving contractor invoices. This domino effect could give rise to payment delays and cash-flow disruption across a contractor’s entire portfolio of federal contracts, grants and other agreements.

We are advising our clients who are currently registered on SAM to submit their notarized authorization letters weeks, or even months, in advance of the annual renewal deadline. Also, for companies that are planning on registering for the first time on SAM, they should do so well in advance of receiving their first contract award.

In addition, contractors should put in place an internal process that results in the preparation and submission of a notarized authorization letter for a newly appointed official any time the current administrator is to be replaced due to promotion, departure or other reasons.

For additional information regarding this new registration requirement and the steps you should take to avoid GSA processing delays and mitigate the risk of payment delays, please contact a member of Pepper Hamilton’s Government Contracts Practice Group.

View a sample form for a single entity appointing an Entity Administrator >

View a sample form for multiple, domestic entities appointing an Entity Administrator >

The material in this publication was created as of the date set forth above and is based on laws, court decisions, administrative rulings and congressional materials that existed at that time, and should not be construed as legal advice or legal opinions on specific facts. The information in this publication is not intended to create, and the transmission and receipt of it does not constitute, a lawyer-client relationship.

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