For the fifth straight year, the number of bid protests filed with the Government Accountability Office has increased, a reflection of contractor insecurity as the government moves to cut spending.
According to the GAO's annual report to Congress, companies filed 2,353 bid protests in fiscal year 2011, up from 2,299 in 2010—and 1,411 in 2007.
Companies file protests to challenge the award of a contract to a rival. Quick-moving and relatively inexpensive to bring, bid protests often get results.
According to GAO, companies obtained some form of relief from the agency awarding the disputed contract 42 percent of the time, consistent with the prior five years.
Of the 417 cases GAO decided on the merits, protests were sustained 16 percent of the time, down slightly from last year, when protestors won 19 percent of the cases.
“I think the increase in bid protests is largely a reflection of actual and expected budget and program cuts,” said Rand Allen, who chairs the government contracts practice at Wiley Rein. “This means there will be fewer future contracts that companies can compete for so they are fighting harder for, and much more willing to protest, existing contract awards.”
The GAO reported that 147 of the protests were attributable to expanded jurisdiction over the types of bids that can be protested. As of May 2008, Congress authorized companies to protest task-and-delivery orders in excess of $10 million—that is, contracts used to acquire supplies or services when the government does not know exact quantities or delivery dates in advance. Last year, there were 189 such protests.
The provision expired in May, but Congress extended it until September 30, 2016, for Department of Defense task and delivery orders.
As for civilian agencies? That legislation is still pending. In the meantime, as Arnold & Porter partner Mark Colley, who chairs the firm’s government contracts group, and associate Emma Broomfield explained in a June client advisory, the GAO decided it still has authority over civilian agency task and delivery orders—and not just the ones worth more than $10 million, but all of them.
“Given that Congress most likely did not intend the sunset provision to repeal all limits on GAO’s jurisdiction over task order protests, this new window for contractors to protest civilian agency task order awards with any value may be short-lived,” they wrote, and “may well spur Congress into action on the pending legislation, which would re-establish the pre-May 27, 2011 status quo for five more years.”