According to a recent U.S. Government Accountability Office (“GAO”) report, the Defense Contract Audit Agency (“DCAA”) and the Defense Contract Management Agency (“DCMA”) have taken certain steps to improve the contractor business system (“CBS”) review process and are forecasting that CBS reviews will increase significantly over the next four years. Contractor business systems include a contractor’s accounting, earned value management, estimating, purchasing, material management, and property management systems. These systems require contractors to maintain internal controls that, as GAO noted, “act as the first line of defense against fraud, waste and abuse of federal funding.” Given their importance, the renewed focus on ensuring CBS reviews are conducted in a timely and consistent manner is not surprising, and contractors should prepare for a new wave of audit activity. Continue reading “Renewed Focus on Contractor Business System Reviews”
The Government Accountability Office (“GAO”) has released its Annual Report to Congress detailing the bid protest statistics for Fiscal Year 2018 (B-158766). The report shows a continuation of recent trends: the sustain rate is low; overall success is nevertheless quite strong; and hearings have become nearly extinct.
The GAO issued a decision on the merits for 622 protests in FY 2018. That represents only a fraction of the 2,607 total protests received, but is the most decisions GAO has issued in at least 10 years. As is typically the case, less than 20 percent of those protests resulted in “sustain” decisions finding in favor of the protester—just 92 protests, or 15 percent of those decided in FY 2018. Despite that seemingly grim rate of success in merits decisions, protesters’ overall rate of success, what GAO terms the “effectiveness” rate, continues to hover around 45 percent. As before, protesters are obtaining desired relief in nearly half of all protests filed—but their “win” typically comes well before a final merits decision with the agency taking voluntary corrective action, usually within the first 30 days of the protest, before the agency report has been filed. Continue reading “FY 2018 GAO Protest Statistics Show Continued Success through Corrective Action”
Any company that has participated in a federal procurement, and has been involved in subsequent bid protest litigation, is likely familiar with the procuring agency’s ability to take “corrective action.” In a nutshell, “corrective action” refers to a procuring agency’s recognition that it may have committed an error during a procurement, and the agency’s determination that it will take steps to correct this error. Procuring agencies take corrective action in a number of different circumstances.
Perhaps most commonly, procuring agencies take corrective action after the U.S. Government Accountability Office (“GAO”) sustains a protest and recommends that the agency remedy the flaws that GAO has identified in the procurement. Agencies also take corrective action in the context of “outcome prediction” Alternative Dispute Resolution (“ADR”). Pursuant to 4 C.F.R. § 21.10(e), GAO, on its own initiative or upon a request filed by the parties, may use flexible alternative procedures to promptly and fairly resolve a protest, including ADR. Often, when GAO informs a procuring Agency during an ADR conference that GAO is likely to sustain a protest, the procuring Agency will announce that it will take corrective action in order to remedy the procurement errors identified by GAO. See, e.g., Deloitte Consulting, LLC, B-412125.6, Nov. 28, 2016, 2016 U.S. Comp. Gen. LEXIS 348 at *1, *5 (wherein agency took corrective action after GAO sustained a protest). Continue reading “Is There No Balm in Gilead? The Federal Circuit’s Decision in Dell Federal Systems L.P. v. United States Reinforces Contractors’ Dwindling Options to Effectively Challenge Agency Corrective Action”
Merle M. DeLancey Jr. and Lyndsay Gorton
Almost daily, clients call our office seeking to protest the award of a federal government contract. Unfortunately, sometimes these calls are too late. While contracts can be protested at the agency level, the Court of Federal Claims, and the Government Accountability Office (“GAO”), GAO protests are the most common. The deadlines by which a protester must take certain actions to file a timely protest are confusing. Below we address some of the trickier and/or mandatory deadlines a potential protester must meet to file a timely protest, and we provide a useful sample timeline for protesters to follow during this critical process. Continue reading “Critical GAO Bid Protest Deadlines and Timeline”