Government Contracts: GAO's 2019 Bid Protest Report to Congress Highlights Protest Effectiveness
The Situation: The U.S. Government Accountability Office ("GAO") recently released its annual Bid Protest Report.
The Result: The report contains a wealth of information about bid protests, including statistics and instances in which an agency failed to fully implement a GAO bid protest recommendation.
The Conclusions: GAO's report shows that, while the total number of protests filed at GAO declined this year, the overall effectiveness of protests remains high. In addition, GAO attorneys held a significantly higher number of hearings this year as compared to last year. The report also shows that unequal treatment has become one of the most prevalent grounds for sustaining protests. Finally, the report explains that agencies followed every single GAO recommendation last year, highlighting the effectiveness of GAO as a forum to remedy procurement flaws.
Each year, GAO publishes its Bid Protest Annual Report ("Report") to Congress for the previous fiscal year ("FY"). This year's report contains statistics about GAO bid protests and identifies any instances in which an agency failed to fully implement a GAO bid protest recommendation. The report contains a wealth of information about the bid protest process.
GAO Bid Protest Statistics
The number of protests filed in FY 2019 dropped by 16% as compared to FY 2018. The 35-day partial government shutdown that occurred between December 2018 and January 2019 may be one reason for this. Although GAO itself was not subject to the shutdown, procuring agencies that experienced a lapse in appropriations were unable to conduct procurements during this time. In addition, enhanced debriefings may be providing contractors with sufficient information about selection decisions for companies to make the informed choice not to protest. It is also possible that the higher jurisdictional threshold for protests of the U.S. Department of Defense ("DOD") task orders (the threshold was raised from $10 million to $25 million in 2017) has contributed to the decline in the number of GAO protests over the past few years.
The number of filed cases is not the only remarkable statistic in the Report. The Report indicates that the so-called effectiveness rate remained steady at 44%. This number describes the percentage of protests in which the protester obtained some form of relief from the agency—either as voluntary agency corrective action or corrective action in response to a sustained protest. The fact that nearly half of all protesters obtained some form of relief demonstrates that GAO remains an effective forum for disappointed contractors seeking relief.
Also notable is the rise in the number of hearings last year (21 in 2019 compared to five in 2018). More than one-third of the GAO Bid Protest Hearing Officers have been at GAO for less than five years. The lower number of GAO hearings in 2017 and 2018 may have been due, in part, to the fact that these newer attorneys were not yet holding hearings to the same extent as more seasoned hearing officers. As these new attorneys settle in, gain experience and training, and become more comfortable holding hearings, GAO's hearing statistics are likely to return to the levels GAO has historically experienced (the percentage of hearings has ranged from 10% in 2010 to 3.1% in 2015).
GAO's chart of bid protest statistics is reproduced below.
Since 2013, Congress has required GAO to provide a summary of the most prevalent reasons for sustaining protests. In FY 2019, the four most prevalent grounds were: (i) unreasonable technical evaluation; (ii) inadequate documentation of the record; (iii) flawed selection decision; and, (iv) unequal treatment. Notably, unequal treatment had not been one of the most prevalent sustain grounds since 2014.
The prevalence of unequal treatment as a "sustain" basis this year reinforces the essential need for GAO (and the protester) to obtain an agency record that includes proposal and evaluation documents for the awardee, as well as the protester. As agencies are apparently finding it increasingly difficult to ensure they evaluate offerors in an equal manner, the importance of adequate document production has become an even more important matter in protests before GAO.
Agency Failure to Follow GAO Recommendations
Finally, GAO's Reports to Congress are required to identify each instance in which a federal agency did not fully implement a GAO bid protest recommendation. GAO reported that there were no such instances in 2019. This is the fourth consecutive year in which agencies fully implemented each of GAO's recommendations, further highlighting the effectiveness of GAO decisions. Because GAO is a legislative branch agency—not a court—it cannot enjoin action or order agencies to correct improper selection decisions. Instead, GAO is limited to making "recommendations" for corrective action. Despite this limitation, the statistics show that GAO's recommendations carry significant weight. Indeed, in the past five years, there has been only one instance—in 2015—in which an agency declined to fully implement GAO's recommendation. As a result, contractors considering potential protest forums can safely presume that if GAO sustains a protest, the agency will comply with GAO's recommendation except in the rarest of circumstances.
Three Key Takeaways
- GAO's consistently high effectiveness rate shows that protesters have nearly a 50% chance of obtaining some form of relief in response to a GAO protest.
- The 35-day partial government shutdown, additional information provided in enhanced debriefings, and the increased threshold for DOD task and delivery order protests, may have contributed to the decrease in overall protests to GAO.
- Unequal treatment of offerors was one of the most prevalent grounds for sustaining protests in FY 2019. This highlights the importance of obtaining a fulsome agency record that includes the awardee's proposal and evaluation documents.
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