Contractors Oppose Proposed Limit on Federal Bid Protests

Pentagon wants fewer “second bites at the apple” for companies.

As the Senate Armed Services Committee on Monday began its markup of the fiscal 2019 National Defense Authorization Act, a contractors group was pushing committee leaders to reject a Pentagon proposal to curb time-consuming bid protests.

Seeking to eliminate what some senators call “frivolous” protests and what acquisition officials call “forum shopping,” the Defense Department this spring pressed for limiting the ability of contractors who unsuccessfully sought an award and are rejected by the Government Accountability Office to then continue their protest at the Court of Federal Claims. The plan would limit the so-called “second bite at the apple” in the court to within 10 days of knowing (or when they  should have known) they had the basis for a protest.

The Professional Services Council, which represents 400 contractors, last week wrote to top senators on the Armed Services and Judiciary committees calling the plan “premature” and saying it would deny fair access to companies seeking relief from “potentially unjustified awards.”

Alan Chvotkin, executive vice president and counsel, reminded the senators that a RAND Corp. study required by the fiscal 2017 NDAA and released in December called for further research. “The report recommended that Congress consider collecting additional data on a number of issues, and specifically listed ‘tracking cases that appear at [federal claims court] with a prior history at GAO,’ ” he wrote.

The RAND study found that from fiscal years 2008 through 2016, less than 0.3 percent of procurements were protested at  GAO, and that small business protests made up more than half of those.

“In addition to the numbers, Congress would benefit from a review of the outcomes of [claims court] cases to determine if the sustained rate reflects the concerns expressed by the Department of Defense,” Chvotkin wrote. His group’s “research finds that there are few covered cases that arise in any one year, which does not justify such a significant legislative change.”

The proposed change—which did not make it into the House version that cleared the committee by a 60-1 vote on May 10—would apply governmentwide. The contractors wrote that it would  “undercut the fundamental purpose of the bid protest process . . . to hold agencies accountable for following the law and their procurement procedures in a transparent manner.”

The fiscal 2018 NDAA contained a compromise that calls for a three-year pilot program in which the threshold for companies affected by limits on bid protests would be raised from companies with $100 million in revenue to $250 million.