In the Fiscal Year 2025 National Defense Authorization Act (“FY25 NDAA”), Congress included some important provisions related to the bid protest process at the U.S. Government Accountability Office (“GAO”). These provisions (1) raise the dollar threshold for task order protests of Department of Defense (“DoD”) procurements and (2) task DoD and GAO with exploring processes to make protesting DoD procurements more difficult.
Task Order Protest Jurisdiction
As a reminder, Congress has given GAO exclusive jurisdiction over protests of task order awards. 41 U.S.C. § 4106(f); 10 U.S.C. § 3406(f). Then, Congress established minimum dollar thresholds for such protests. Prior to the FY25 NDAA, the threshold for protests of task orders issued by civilian agencies was $10 million and protests of task orders issued by DoD was $25 million. FAR 16.505(a)(10). Now, Section 885 of the FY25 NDAA raises the dollar threshold for DoD task order protests from $25 million to $35 million. GAO ordinarily looks at the value of the awarded task order to determine whether it has jurisdiction. Thus, going forward, if an award of a DoD task order is less than $35 million, an unsuccessful offeror cannot protest it.
Potential Protest Process Changes
Additionally, Section 885 asks GAO and DoD, within 180 days, to explore some processes that may make it harder to protest DoD awards:
Enhanced Pleading Standards
GAO and DoD are required to submit a proposal for a process for enhanced pleading standards that would apply to interested parties that protests DoD awards prior to granting such protesters access to the Administrative Record. In other words, the proposal will, potentially, make it harder for a protester to survive an Agency Request for Dismissal before the Agency submits its Agency Report and Administrative Record.
Under the current GAO bid protest regulations, a protester need only provide a “detailed statement of the legal and factual grounds for protest” and it must state “legally sufficient grounds for protest.” 4 C.F.R. §§ 21.1(c)(4), 21.1(f). GAO has stated a protester must provide “allegations or evidence, if uncontradicted, to establish the likelihood that a protester will prevail on its claim of improper agency action.” CACI Techs., Inc., B‑408858, B-4408858.2, Dec. 15, 2013, 2013 CPD ¶ 283. This is generally perceived by GAO as a low bar for surviving a Request for Dismissal, as long as the protester’s grounds are not based solely on speculation.
However, it will be interesting to see what the GAO and DoD proposal suggests for enhancing these pleading standards. Most often, protesters have only their notice of award and debriefing information to use in drafting a protest, which can be very little facts on which to base a protest. If the enhanced pleading standards are adopted, we may see more protests dismissed or partially dismissed before the Agency provides its response on the merits of the protest.
Protest Costs
GAO and DoD are also required to calculate the average costs of a protest to the Government, as well as the lost profits of the contractors that were awarded the contracts subject to protests. Then, GAO and DoD are required to submit a proposal for payment by an unsuccessful party to a protest to the Government and the awardee in accordance with the calculated costs and lost profits.
If this process is eventually adopted, it would likely cause a major shift in a protester’s risk/benefit analysis before deciding whether to file a protest. However, it is important to note that this is not the first time Congress raised this idea. In the FY18 NDAA, Congress passed a similar pilot program for DoD to assess the feasibility of requiring large contractors (i.e., those receiving over $250 million in revenue) to reimburse DoD for the costs associated with an unsuccessful protest. Congress then repealed this pilot program in the FY21 NDAA because “the pilot program [was] unlikely to result in improvements to the bid protest process given the small number of bid protests captured by the pilot criteria and lack of cost data.” It is possible that by expanding the program to all contractors and instructing GAO and DoD to first calculate the costs, Congress is aiming to remedy the flaws in the FY18 program.
We will be watching for the GAO and DoD proposal due by June 21, 2025.