This is part 1 of a 3 part series discussing state-level bid protests in the DMV.
    
For a contractor who just expended significant time and money to bid on a DMV state-level government contract, only to watch the award go elsewhere, disappointment is understandable. But, what if the contractor believes that the state agency got it wrong?  How can the contractor challenge the award?

The answer is that the contractor can file a state-level bid protest to challenge the procurement result and potentially win the award, or at least another chance at it. While a bid protest at the Federal level involves utilizing comparatively well-known, uniform procedures that offer more predictable paths to relief, a state-level bid protest can be a murkier affair. Statutes and regulations that govern the bid protest process can differ greatly from jurisdiction to jurisdiction, and even from agency to agency in the same jurisdiction. Further, a would-be protester should be prepared to deal with ambiguous or potentially unhelpful rules for filing, the sharing of agency documents, the opportunity to present argument to an independent adjudicator, and suspension of performance of the awarded contract while the protest is considered.   

Overall, the bid protest process moves at a rapid pace. It helps for a contractor to have some familiarity with the relevant procedures, and to quickly contact experienced counsel.  Over the coming days, we will summarize the fundamental features of the bid protest process for each jurisdiction (D.C., Maryland, and Virginia). This first segment addresses the authorities and rules for Maryland state-level bid protests.    

GENERALLY RELEVANT LAW

The statutes covering Maryland General Procurement Law are found at Division II of the State Finance and Procurement Article in the Maryland Code.

AUTHORITY TO ISSUE SOLICITATIONS AND MAKE AWARDS

Generally, procurement in Maryland is conducted under the authority of the Board of Public Works (“BPW”), which consists of the Governor, State Comptroller, and State Treasurer, and is supported by a Procurement Advisor and staff. However, some executive branch agencies are exempt from the authority of the BPW, and there are independent agencies that are, to some degree, exempt from Maryland General Procurement Law. Also, Government entities that are not part of the executive branch of the State Government do not fall under the BPW.  The BPW’s authority has been delegated to ten agencies designated as procurement units, and seven of those units are also “control authorities[,]” meaning that they can conduct procurements on behalf of other agencies, or re-delegate their procurement authorities to other agencies. MD. CODE, STATE FIN. & PROC. § 12-107. The person given authority to form a contract on behalf of a procurement unit, control authority, or designee agency is called a Procurement Officer. Generally speaking, but with numerous exceptions and carve-outs, any multiyear contract, or contract valued greater than $200,000, must be approved by the BPW. Solicitations are typically posted on the eMaryland M@rketplace, available here.

INITIAL PROTEST FORUM

Typically, the agency is the initial protest forum, and administrative appeals go to the Maryland State Board of Contract Appeals (“MSBCA”) after the agency has rendered a final decision. See COMAR 21.10.02.02 (“An interested party may protest to the appropriate procurement officer against the award or the proposed award of a contract . . . .”). However, the jurisdiction of the MSBCA may not extend to exempted or independent agencies. In which case, the only administrative protest available may be at the agency level, according to rules published in the relevant solicitation and/or the agency’s regulations.

TIME TO PROTEST

Generally, a protest of the terms of a solicitation must be filed with the agency Procurement Officer before bid opening or the deadline for receipt of proposals. Other protests, e.g., protests of an award, “shall be filed not later than 7 [calendar] days after the basis for protest is known or should have been known, whichever is earlier.”  COMAR 21.10.02.03(B). An exempted or independent agency may have different timeliness rules for its protest process.

ACCESS TO INFORMATION

At the agency level, a protester may have limited access to information, and may have to make a separate Maryland Public Information Act request in order to obtain more information. Conversely, the protester should mark its protest submissions as confidential in order to reduce the risk of public disclosure. Once the protester gets to the MSBCA, the procuring agency must submit an agency report which contains details about the procurement, there is a protective order process to facilitate information sharing, see Free State Reporting, Inc., MSBCA No. 2143, at 13 (1999) (protective order used in a protest appeal), and, if necessary, discovery, subpoenas, and evidentiary hearings are available as information-gathering tools. If the protest is with an exempted or independent agency, and the MSBCA does not have appeal jurisdiction, and the agency’s rules do not provide for some type of agency report, a protester may have to file a Public Information Act request in order to obtain additional information.

STAY OF PERFORMANCE

For an agency that awarded the contract pursuant to the authority of the BPW, or pursuant to the delegated or re-delegated authority of the BPW, COMAR provides that the contract cannot be executed following a timely agency level protest. However, a stay override may be implemented upon a determination “that execution of the contract without delay is necessary to protect substantial State interests[.]” COMAR 21.10.02.11. Otherwise, the stay remains in place until the MSBCA issues a final decision, or the protest process is otherwise finished. If the protest is with an exempted or independent agency, and the agency’s rules do not provide for a stay of performance, the contractor may have to seek a preliminary injunction in the appropriate Circuit Court in order to obtain a stay of performance, assuming that is possible. But see Priester v. Baltimore Cnty., 232 Md. App. 178, 195 (Md. Ct. Spec. App. 2017) (“[A] petitioner cannot seek judicial review of an interlocutory decision by that agency unless an interlocutory appeal is authorized by statute.”).

PROTEST PROCEDURE

Upon receipt of the initial protest, the Procurement Officer is supposed to immediately notify the Office of the Attorney General. Thereafter, the Procurement Officer may request additional information from the protester to support the protest. “A decision on a protest shall be made by the procurement officer in writing as expeditiously as possible after receiving all relevant, requested information[,]” and must be approved by the agency Reviewing Authority. COMAR 21.10.02.09.  Once final, an appeal to the MSBCA “shall be filed within 10 [calendar] days of receipt of notice of the final procurement agency action[,]” except that the appeal will “not be considered unless it was sent by registered or certified mail not later than the fifth day before the final date for filing an appeal . . . .”  COMAR 21.10.02.10. At the MSCBA, the procuring agency must provide an agency report within 15 working days, the protester and any intervenor has ten days to make comments on the agency report, and party rebuttals are due five days following. Further factual development may also occur through the use of a hearing. Additionally, if necessary, the MSBCA may issue a subpoena, which can be enforced by a Maryland court. An MSBCA protest must be decided upon “expeditiously.” MD. CODE, STATE FIN. & PROC. § 15-221(a)(2). The protester can generally expect an MSBCA protest appeal to take 90-120 days, with some protest appeals running shorter or longer.

AVAILABLE REMEDIES

The MSBCA may provide declaratory relief by recommending that the procuring agency undertake specific corrective action, including possibly recommending that the procuring agency make award to a particular bidder or offeror.  If the protest is sustained, the protester may also recover its protest costs. At the agency level, the Procurement Officer may grant whatever relief is within his or her legal authority, including but not limited to terminating-for-convenience the awarded contract, re-competing the contract, issuing a new or amended solicitation, or not exercising a contract option.

GOING TO COURT

An MSBCA protest decision is reviewable in a court of competent jurisdiction, e.g., the County or Baltimore City Circuit Court. There may be jurisdictional issues over the appeal of the final decision of an agency level protest with an exempted or independent agency.

Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. The author has provided the links referenced above for information purposes only and by doing so, does not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.

[View source.]