Monday, April 2, 2018

Final Rule on GAO Bid Protest Changes

The GAO (Government Accountability Office) published its final rule establishing a new mandatory electronic filing and document dissemination system for filing bid protests. The rule becomes effective on May 1st (one month from now). Oh, and by the way, it comes with a filing fee - it will now cost your $350 each time you file a bid protest.

There were 19 comments pertaining to the proposed fee when the GAO published its proposed rule. Five of the 19 were in favor of the fee. Fourteen commentators opposed the fee on the basis that it creates a barrier to filing protests for small businesses, some of which stated that they lack the resources to pay the fee. In particular, one commentator argued that a $350 fee would make a protest economically infeasible for small businesses seeking the award of very small contracts.

GAO responded:
GAO does not intend for the fee to discourage or reduce the number of protests. Rather, the proposed fee will cover the costs of establishing and operating EPDS (Electronic Protest Docketing System). GAO does not agree with the proposals to charge a fee that is higher than necessary to address the costs of EPDS or for the purpose of discouraging protests. With regard to a lower fee or fee waiver for small businesses, GAO has concluded that the anticipated fee of $350 is appropriate given the costs of the system. Additionally, GAO has concluded that the interest of administrative efficiency supports imposition of a uniform fee for all protests.
GAO doesn't want to discourage protests, but at $350 per filing, it would have cost Latvian Connection $157,000 to file its 450 bid protests over a five year period. Perhaps we should refer to the $350 fee as the "Latvian Fee".

There are a few other significant revisions to the bid protest regulations including (i)due dates, (ii) requests for documents (iii) the ability to request relevant documents not in the Government agency's possession, and (iv) handling protected documents. Read the full final rule here.

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