For the first time in nearly a decade, GAO in Knudsen Systems, Inc. sustained a protest challenging an agency’s decision to set aside a procurement for small businesses. The decision involves the so-called “Rule of Two”: under FAR 19.502-2(b), agencies must set aside for small businesses a procurement with an anticipated dollar value of more than $150,000 where the agency’s market research demonstrates there is a reasonable expectation at least two responsible small business offerors can meet the agency’s requirements at a fair market price.Continue Reading “Et ‘two,’ GAO?”:Recent Sustain on the Rule of Two Reminds Agencies of the Importance of Accurate Market Research
Bid Protests: GAO Reminds Would-Be Protesters – Timing Is Everything
What You Need to Know
- Key takeaway #1Protests of an agency’s actions during corrective action can raise tricky timeliness issues—if the protest could be construed as challenging the ground rules of the procurement, the protest may be subject to the pre-award timeliness rules. But protests that do not challenge the procurement ground rules, and instead
U.S. Chamber Submits Comments on the FAR Council’s Proposed Rule Regarding Pay Transparency
On January 30, 2024, the FAR Council issued a proposed rule entitled “Pay Equity and Transparency in Federal Contracting” (“Proposed Rule”). The Proposed Rule would: (1) prohibit contractors and subcontractors from seeking and considering information about job applicants’ compensation history when making employment decisions about personnel working on or in connection with a government contract; and (2) require contractors and subcontractors to disclose, in all advertisements for job openings involving work on or in connection with a government contract placed by or on behalf of the contractor or subcontractor, the compensation to be offered to the hired applicant for any position to perform work on or in connection with the contract.Continue Reading U.S. Chamber Submits Comments on the FAR Council’s Proposed Rule Regarding Pay Transparency
Nuziard v. Minority Business Development Agency: Another Blow To Federally Sponsored Affirmative Action Efforts
On March 5, 2024, a federal judge in Texas struck down a federally-sponsored racial preference extended to minority groups seeking to access capital and government contracts. Nuziard v. Minority Business Development Agency (“Nuziard”). Plaintiffs, who are non-minority business owners, challenged a preference provided by the Minority Business Development Agency (“MBDA”), a bureau of the Department of Commerce, to “socially or economically disadvantaged individual[s],” defined to include African Americans, Hasidic Jews, Hispanic Americans, Native Americans and Pacific Islanders. The court struck down the MBDA’s presumption that such racial minorities are socially disadvantaged, finding the preference violated the Equal Protection Clause. Nuziard, like the recent decision by a federal court in Tennessee in Ultima Services Corp. v. U.S. Department of Agriculture (“Ultima”), follows the Supreme Court’s decision in Students for Fair Admissions, Inc. v. Pres & Fellows of Harvard College, 600 U.S. 181 (2023) (“SFFA”) and, like Ultima, advances the mission of activist organizations across the country seeking to invalidate race-based presumptions in federally funded and sponsored entitlement programs. Continue Reading Nuziard v. Minority Business Development Agency: Another Blow To Federally Sponsored Affirmative Action Efforts
Show Me the Money: Contractors and Subcontractors May Soon Be Subject to Pay Transparency Requirements, Which May Also Trigger New Bid Protest Issues
Following a January 29, 2024 White House announcement and Fact Sheet, on January 30, 2024, the Federal Acquisition Regulation (FAR) Council issued a Notice of Proposed Rulemaking (Proposed Rule) on salary-history bans and pay transparency for applicants and employees of federal contractors and subcontractors. On the same day, the Office of Federal Contract Compliance Programs (OFCCP) issued some FAQs on the compensation history issue. These actions by the federal government to ban prior salary information and require compensation information in job postings echo the efforts of multiple states and municipal governments that have enacted similar salary history bans and/or compensation disclosure requirements:Continue Reading Show Me the Money: Contractors and Subcontractors May Soon Be Subject to Pay Transparency Requirements, Which May Also Trigger New Bid Protest Issues
GAO’s First Sustain of 2024 Emphasizes the Need for Documented Analysis of Offerors’ Proposals Against Solicitation Requirements
In its first published bid protest sustain decision of the new year, the Government Accountability Office (GAO) highlights agencies’ obligation to adequately document a substantive analysis of proposals against the solicitation requirements, even in FAR Part 16.5 procurements. In SierTeK-Peerless JV LLC, B-422085, B-422085.2, Jan. 2, 2024, the Transportation Security Administration (TSA) conducted a task order competition for property management support services among OASIS 8(a) pool 1 contract holders. The solicitation required TSA to assess the size and scope of offerors’ prior experience as compared to the solicited task order requirements. SierTeK-Peerless, the unsuccessful offeror, challenged TSA’s award to Strativia, arguing in a supplemental protest that the agency’s evaluation of the awardee’s prior experience was flawed because TSA failed to reasonably assess the similarity of Strativia’s prior experience. Continue Reading GAO’s First Sustain of 2024 Emphasizes the Need for Documented Analysis of Offerors’ Proposals Against Solicitation Requirements
GAO’s 2022 Bid Protest Report to Congress for FY 2021 Shows Better than 50% Chance of Obtaining Relief
On November 1, 2022, the U.S. Government Accountability Office (GAO) released its Annual Report on Bid Protests for Fiscal Year 2022. While the number of protests GAO received dropped by 12% for the second year in a row, the overall protest “Effectiveness Rate”—meaning the percentage of cases in which the protester received some form of relief, such as voluntary corrective action by the agency or a GAO sustain—increased to 51%, tying Fiscal Year (FY) 2020 for the highest rate in the past five years.
GAO’s Annual Report also provides a helpful summary of the most common grounds for sustained protests in the prior year. In FY2022, those grounds were: (1) unreasonable technical evaluation; (2) flawed selection decision; and (3) flawed solicitation. The inclusion of “flawed solicitation” on the list is notable—it has only made the list of “most successful grounds” one other time since GAO began tracking successful protest grounds. This serves as a reminder that contractors should consider a pre-award protest as a potentially viable method of resolving solicitation flaws and ambiguities if other routes (such as the Q&A process) are unsuccessful or unavailable.
The chart below shows the top sustain grounds by year. As seen below, flawed technical evaluations continue to represent one of the most consistently successful grounds for sustains, meaning would-be protesters should consider whether they have a credible basis to make such arguments when weighing an award challenge. Continue Reading GAO’s 2022 Bid Protest Report to Congress for FY 2021 Shows Better than 50% Chance of Obtaining Relief
DoD Issues Class Deviation For Small Business Joint Venture Offerors Until SAM Is Updated to Account for Recent FAR Revisions
On October 26, 2022, the Department of Defense published a class deviation establishing alternative procedures for verifying the small business size and status of joint venture offerors. This class deviation is necessary because, effective October 28, 2022, the Federal Acquisition Regulation has been updated to include new certifications for use by joint venture offerors in
GAO Breathes New Life into the Commonly Denied “Failure to Award a Strength” Protest Ground
Challenging an agency’s failure to award a “strength” for a proposal feature can prove to be an exercise in futility. GAO frequently characterizes this oft-rejected argument as mere disagreement and defers to the agency’s conclusions. But, following GAO’s decision in Tech Marine Business, Inc., B-420872, Oct. 14, 2022, the tide may be turning. Agencies are now required to demonstrate that their decision not to award strength credit was reasonable and consistent with the stated evaluation criteria.
The protester, Tech Marine Business, Inc. (Tech Marine) alleged that the Navy failed to award Tech Marine a strength for its transition plan. The solicitation required the awardee to “begin work immediately and assume responsibility from the incumbent Contractor, if applicable, within 60 days after Task Order award.” Tech Marine, the incumbent contract, explained that its transition plan exceeded the Navy’s schedule for workload turnover and that transition would be completed “well in advance of the 60–day requirement.” Continue Reading GAO Breathes New Life into the Commonly Denied “Failure to Award a Strength” Protest Ground
FAR Updated to Reflect Revised SBA Regulations
On September 23, 2022, the FAR Council issued a number of final rules amending the Federal Acquisition Regulation (FAR) to reflect changes previously implemented by the Small Business Administration (SBA) to its regulations on women-owned small businesses and HUBZones, as well as to clarify policy on joint ventures in small business contracting.
The final rule on HUBZones (87 FR 58232) aligns the FAR’s definition of a HUBZone in provisions and clauses such as FAR 2.101, 52.212-3, 52.219-1, 52.219-8 and 52.219-9 to refer to the requirements described in 13 C.F.R. § 126.200 and SBA’s designation of a HUBZone small business concern in the Dynamic Small Business Search (DSBS). This is in line with the SBA’s recent revisions to the HUBZone regulations via which SBA annually certifies HUBZone entities in order to allow such entities to remain eligible for HUBZone contracts for the entire year rather than such entities being required to represent their status for each offer. Higher-tier contractors are required to confirm that a subcontractor representing itself as a HUBZone small business concern is certified by SBA as a HUBZone small business concern by accessing SAM or by accessing DSBS. The rule also allows contracting officers to award HUBZone set-aside and sole-source contracts at or below the simplified acquisition threshold. Continue Reading FAR Updated to Reflect Revised SBA Regulations