Bid Protest Reform: Is It Really Neccessary?

Some think bid protests are 'the Devil incarnate,' according to one judge; a procurement proposal forces the debate

Recent proposals to reform procurement may be a case of the cure being worse than the disease.

At least that's what some experts are saying about reform proposals regarding the ever- controversial issue of bid protests. One proposal would do away completely with the administrative body at the General Services Administration that currently handles bid protests from contractors. Absent this body, contractors may have no choice but to turn to the federal courts, which could tie up procurements even longer. Because of this, "the 'streamlining' that is being proposed may actually result in a system that takes longer than the current one," said William Weisberg, a partner at the McLean, Va., law firm of Barton, Mountain & Tolle.

"Some say bid protests are the greatest thing that ever happened while others say it is the devil incarnate," said Judge Robert William Parker of the General Services Board of Contract Appeals, speaking at a June conference on federal contracting sponsored by the Vienna, Va.-based market researcher Input.

Contractors have two administrative protest options: the General Accounting Office and the General Services Board of Contract Appeals. GAO is set up to hear protests for all facets of government purchasing, while GSBCA tends to be limited to information technology procurements. GAO assumes that the government's basis for the procurement is sound, GSBCA does not. GAO allows opposing sides to gather limited information about the procurement from each other -- usually limited to paper documents, GSBCA allows opponents to conduct arduous interviews with the people involved. Both the oral and written process is called discovery.

There have been some abuses, such as excessive discovery, which is causing Congress to propose a complete overhaul of the bid protest system, said Laura Kennedy, a partner specializing in government contracts law at the Washington, D.C., office of Seyfarth, Shaw, Fairweather & Geraldson.

"I don't think there needs to be radical change," she said. A measure proposed by Sen. William Cohen, R-Maine, would eliminate GSBCA, whereas a House proposal would make reforms.

"I think the status quo, with some evolutionary changes, is fair and workable from the contractor standpoint," said Weisberg, who has defended and pursued contractor appeals. These changes would include having the loser pay the winner's court costs and giving GSBCA greater ability to dismiss frivolous protests, he said. Limiting the discovery process troubles Weisberg the most about the proposed changes.

If companies perceive that there is no alternative for forcing government agencies to provide evidence they will pursue a case in federal court, Kennedy predicted. There are no time limits, either to file the case, or to have it resolved, under the federal court systems, but there are much tougher standards to file, she said.

The government is now in a cycle where they want to empower employees, particularly contracting officers. Yet the current GSBCA system was put in place in the 1980s because of a feeling that those people were making biased decisions, Weisberg said. Contracting officers had a tremendous amount of discretion, leading to some abuses.

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