GAO Loses Jurisdiction Over Task Order Protests Valued at More Than $10 Million

by Sheppard Mullin Richter & Hampton LLP
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Government contractors hoping to challenge a civilian agency’s award of a task or delivery order may be out of luck, at least temporarily. Prior to September 30, 2016, the Government Accountability Office (“GAO”) had exclusive jurisdiction over protests of civilian task and delivery orders valued at more than $10 million under multiple-award IDIQ contracts. The National Defense Authorization Act (“NDAA”) for Fiscal Year 2008 amended the Federal Acquisition Streamlining Act (“FASA”) to grant GAO this jurisdiction, Pub. L. No. 110-181, 122 Stat. 3, 237 (2008); the NDAA for Fiscal Year 2012 then established a sunset date for this jurisdiction of September 30, 2016, 41 U.S.C. § 4106(f). Any such protests filed after September 30, 2016, are now outside GAO’s jurisdiction, regardless of when the underlying contract was awarded. 41 U.S.C. § 4106(f). However, contractors retain the right to protest military task and delivery orders valued over $10 million, 10 U.S.C. § 2304c(e), as well as civilian or military task and delivery orders which they allege increased the scope, period, or maximum value of the underlying contract, id. and 41 U.S.C. § 4106(f). The Court of Federal Claims’ jurisdiction, which is limited to civilian or military task order protests that allege increased scope, period, or maximum value of the underlying contract, is unaffected by the NDAA sunset provision. 10 U.S.C. § 2304c(e); 41 U.S.C. § 4106(f).

Ryan Consulting Group, Inc., of Indianapolis, Indiana, bore the brunt of the jurisdictional sunset in a GAO decision issued November 7, 2016, B-414014. Ryan, one of the multiple-award contract holders, was protesting a task order award by Department of Housing and Urban Development under a multiple-award, IDIQ contract with the National Institutes of Health. The task order for enterprise architecture and information technology management support services was valued at more than $10 million.  Ryan did not allege any increase in scope, period, or maximum value of the underlying contract, so GAO had no other basis for jurisdiction. GAO dismissed Ryan’s protest, filed October 14, 2016, for lack of jurisdiction, and noted that GAO has no authority to “grandfather” any protests.

Two pieces of pending legislation could reinstate GAO’s jurisdiction.  The first is S. 2943 (114th Cong.), the NDAA for Fiscal Year 2017, which likely would delete the sunset clause from 41 U.S.C. § 4106(f).  This Senate bill technically passed the House with an amendment on July 7, 2016, but Congress has yet to agree on a final version of the bill to submit to the President.  Both the current Senate and House drafts of the 2017 NDAA would reinstate GAO’s jurisdiction permanently, but this is not certain until Congress finalizes the bill and the President signs it into law.  Alternatively, H.R. 5995 (114th Cong.), “GAO Civilian Task and Delivery Order Protest Authority Act of 2016” is a narrowly tailored bill aimed specifically at this jurisdictional issue.  Sponsored by Mark Meadows (R-NC), the bill passed the House on September 21, 2016, and is currently in the Senate.  Unless S. 2943 or H.R. 5995 succeeds in renewing GAO’s jurisdiction, civilian agency multiple-award contract holders will not be entitled to challenge a task or delivery order before the GAO unless they allege an increase in scope, period, or maximum value of the underlying IDIQ contract, in which case they could protest at either GAO or the Court of Federal Claims.  If GAO does regain jurisdiction, contractors whose protests were dismissed for lack of jurisdiction during the interim could file a request for reconsideration within 10 days of the change in law.  See 4 C.F.R. § 21.14 (b).

The GAO opinion may be accessed here: http://www.gao.gov/assets/690/680856.pdf.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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