2009 GAO Bid Protest Statistics Show Decrease in Sustain Rates But Dramatic Increase in ADR Success Rates

2.1.2010 - Posted in E&B Alerts - Government Contracts

The Government Accountability Office ("GAO") recently released its bid protest statistics for calendar year 2009. According to the data, there was a 20.4% increase in protests in 2009 (1989 cases filed) when compared to data from 2008 (1652 cases filed), and a 41% increase over 2007 (1411 cases filed). The percentage of decisions on the merits (those cases that are not dismissed for lack of jurisdiction, failure to follow the GAO's exacting timelines or because the contracting agency grants the relief sought by the contractor) on protests increased by only 8% from 2008. Overall, while 20.4% more protests were filed in 2009 than in 2008, the percentage of GAO protests sustained dropped from 21% to 18% over this same period. Likewise, the percentage of protests filed in which the agency issued a decision on the merits dropped from 17.6% in 2008 to 15.8% in 2009. From this data, it appears that contractors may be filing more protests to protect potential business opportunities in lean times. At the same time, fewer protests are being decided on their merits, and, of those for which the GAO does issue a decision, the success rate of protestors decreased slightly over the last year - although both numbers are within historical trends for the past several years.

Most remarkably, the percentage of protests resolved through alternative dispute resolution ("ADR") increased by 91%. While each protest is unique, the data provided by the GAO indicates that the number of protests has continued to rise and that federal agencies are increasingly employing ADR to resolve protests. Although the number of cases resolved through ADR increased 91%, these cases still make up a minority of the protests filed with GAO. In 2009, 1989 protests were filed with the GAO. The report shows that 149 of those protests utilized ADR, roughly 7.5% of all protests. On the other hand, 315 cases went to a decision on the merits, or about 16%. Significantly, unsuccessful offerors seemed to be much more successful in ADR than before the GAO. Protestors achieved at least some form of relief in 93% of the cases resolved by ADR whereas only 18% of protests on which the agency reached a decision on the merits were sustained.

As the economy continues to recover, the number of protests filed in 2010 may well continue to rise. The bid protest process - already a uniquely cost-effective way to challenge the award of a federal government contract - can be a contractor's best chance at ensuring a fair chance to bid on business opportunities with the federal government. The increased successful use of ADR is a positive development for all disappointed bidders. The information in the GAO Report is an important part of the equation to apply when deciding whether or not to protest the award of a government contract.

The complete data on 2009 protests as published by the GAO is available online at www.wifcon.com/protestsgaostat.htm For more information please contact Jeff Eckland at [email protected] or (612) 236-0160.