Bid protests increase in 2012, nearing 15-year high

Tuesday - 11/13/2012, 7:32pm EST

The number of bid protests filed in fiscal 2012 ticked up 5 percent from last year to 2,475 cases — more than any year since 1995, according to a new report from the Government Accountability Office.

The previous year, companies filed 2,352 bid protests. The number of bid protests filed has increased every since 2007. (See full chart below)

In 2012, GAO issued decisions (either sustaining or denying the protest) for 570 on the cases, a 27 percent jump from last year. Of those decisions, 106 or 18.6 percent of the decisions were sustainments. Last year, 16 percent of merit decisions were sustainments.

Most protests, however, are resolved by either the agency agreeing to withdraw the contract award at issue or by the company withdrawing its protest before a final decision is made.

The number of cases that were sent to alternative dispute resolution (ADR) continued a multi-year decline, falling to 106 — the lowest number since 2008.

GAO also reported there were 18 instances last fiscal year where an agency refused to fully implement GAO's recommendations on a bid-protest decision. All of those cases stem from a protracted legal dispute between the Veterans Affairs Department and a handful of service-disabled, veteran-owned small businesses (SDVOSB) over the agency's decision to issue contracts through the Federal Supply Schedule without first discerning whether small businesses were capable of participating. One of the companies has filed a case with the U.S. Court of Federal Claims.

Contracting analysts contend the near-record number of bid protests are indicative of growing tensions between agencies and contractors.

Source: Government Accountability Office

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