A recent study from the Congressional Research Service (CRS) identified several notable trends in bid protests before the Government Accountability Office (GAO) from FY 2001 to FY 2014. Foremost among these trends are (1) a significant increase in bid protests filed over the past fourteen years but relative stability in filing rate over the past several years; (2) a decrease in the protest sustain rate but increase in “effectiveness rate” over the same time period; and (3) a divergence in protest statistics between civilian and defense contracts.
The CRS report provides a longer-term perspective on protests trends than the GAO’s annual report to Congress, which focuses on only the past five years. This longer-term perspective highlights the remarkable growth in GAO filing rates and the wide-ranging impact of the GAO protest process on procurements government-wide.
More Protests Filed: CRS noted that in FY 2014, GAO received 2,561 protests, a 125% increase since FY 2001. This increase is even more dramatic when adjusted to examine how many procurements were protested by excluding multiple protests on a single procurement, cost claims, and requests for reconsideration. From FY 2001 to FY 2014, the number of procurements protested increased from 700 to over 2,100. However, protests filings have remained steady since FY 2011, with a less than 3% increase over that timeframe, indicating a recent stabilization in protest filings.
Lower Sustain Rate But Higher Effectiveness Rate: While filings rates have increased significantly, sustain rates have declined slightly. From FY 2001 – FY 2008, the sustain rate was at 22%. That figure declined to 17% from FY 2009 – FY 2014. FY 2014 saw a 13% sustain rate, the lowest rate in the CRS report’s period of study.
By contrast, the protest “effectiveness” rate has increased from 33% in FY 2001 to 43% in FY 2014. CRS noted competing theories for the increase in effectiveness rate, including the predicable nature of GAO decisions leading agencies to take voluntary corrective action as well as agency risk-aversion.
Defense v. Civilian Contracting: The CRS report concluded that, on average, civilian procurements are more likely to be protested and be the subject of sustained protests than defense procurements. Protest filing rates of both defense and civilian procurements are on the rise, but the growth is more pronounced for civilian procurements, which has seen a 260% rise in protests since FY 2001, as compared to 170% in defense procurements. While protests of defense procurements still outnumber civilian procurement protests in the aggregate, the gap is quickly shrinking, with civilian procurements accounting for 48% of protests closed in FY 2014.
The CRS report also found that protests of defense procurements are less likely to be sustained than civilian procurement protests. Between FYs 2008 – 2014, 2.5% of defense-related protests were sustained by GAO, as compared to 5.0% of civilian agency protests.