The System for Award Management (SAM) is a government website and database that helps government contractors find information about government-issued contracts. It combines multiple databases such as the Central Contractor Registry (CCR), the Online Representations and Certifications Application (ORCA), the Federal Agency Registration (Fedreg) and the Excluded Parties List System (EPLS), which were individual resources prior to the creation of SAM.gov. Being a member of a SAM exclusion list can be devastating to your business.
What Is The System For Award Management (SAM) Exclusion?
An exclusion also referred to as a suspension or debarment, excludes a particular contractor from receiving contracts that are issued by the federal government. This could be either a temporary or long-term exclusion, depending on the reason for the exclusion. Registration with SAM.gov is necessary for government contractors, and exclusion from SAM can have a detrimental impact on your business.
Reasons Government Contractors May Be Added To The SAM Exclusion List
There are multiple reasons why a contractor may be considered excluded from registering on SAM.gov and receiving government contracts. The following is a more detailed explanation of why you could be added to the SAM exclusion list. This should help you take the proper action to prevent an exclusion and promptly identify and address the cause of the exclusion if you do find yourself on the SAM exclusion list.
The Contractor Has Been Barred From Entering The United States
Those who are barred from entering the United States for any reason are not eligible for government contracts and are subsequently placed on the SAM exclusion list. Of course, this only applies to contractors who are located or entities that are headquartered in a different country. Many individuals are unaware that they are barred from entering the United States, and this should be one of the first things that contractors check if they live outside the United States and find themselves on the SAM exclusion list.
The Contractor Has Violated National Security Protocols
There are national security protocols that government contractors must follow with certain government-issued contracts. Any violations of these national security protocols could lead to exclusion from SAM and subsequently not being eligible for government contracts in the future. Depending on the severity of the violation and the number of prior offenses, this could either be a temporary or more permanent exclusion from SAM.
The Contractor Has Been Convicted Of Tax Fraud
Tax fraud, or tax evasion, is an illegal attempt to avoid paying your taxes. If you are convicted of tax fraud, then you are added to the SAM exclusion list, which is often for an indefinite or permanent amount of time. In this case, you are seen as owing the government money and have broken federal law. Along the same lines, any illegal business activities that you are convicted for could lead to your entity being added to the SAM exclusion list.
The Entity Has Student Loan Debt (In Some Instances)
If you borrowed government-issued student loans to attend college or trade school and are still in the process of paying them back, then it could be the reason you are on the SAM exclusion list. This could especially be the case if you have missed multiple student loan payments or your loans are now in default. In many cases, this issue can be resolved by getting your student loans out of default.
The Contractor Owes The Government Money For Any Reason
As mentioned, student loan debt could be a cause for SAM exclusion. Additionally, if you owe the federal government money for any other reason, then you may also be added to the SAM exclusion list.
The Contractor Did Not Follow FAR Guidelines On Previous Contracts
The Federal Acquisition Regulation (FAR) is the government’s set of rules for contract procurement. Any violations of FAR guidance, such as accounting errors or failure to comply with timekeeping requirements, could lead to exclusion from SAM.
How Can I Avoid Being Added To The SAM Exclusion List?
You can best avoid SAM exclusion for your business by following all government requirements and regulations and by following sound and organized business practices. You should also understand the details of the contracts that you apply for before submitting a bid.
What Can I Do If I Am Added To The SAM Exclusion List?
You should not panic if you find yourself on the SAM exclusion list. For many contractors, it is not a serious concern and can be resolved relatively quickly. However, it is important to promptly identify the reason you have been added to the SAM exclusion list and address the concern. It can help to work with a professional who understands government regulations as it pertains to contract procurement and completion.
Notably, working with a certified public accountant that has experience with situations similar to yours can help clear up exclusions in a timely manner. While an exclusion from SAM can certainly be lifted, it can still be a huge deterrent to your government contracting business. For support in understanding your current exclusion, or to learn more about how to maintain compliance in order to avoid exclusion from SAM in the future, reach out to us online or over the phone at (703) 386- 7825 to schedule an appointment with one of our certified public accountants.