Proposed 2017 NDAA is a Mixed Bag for Government Contractors

Cohen Seglias Pallas Greenhall & Furman PC

Last month, we reported that the Government Accountability Office’s (“GAO”) statutory authority to hear bid protests on civilian task orders exceeding $10 million had expired, leading to a parade of dismissed protests and disappointed contractors left without legal recourse. As of last week, there is reason to be hopeful, as the House of Representatives and Senate agreed on legislation that promises to permanently restore the GAO’s authority to hear civilian bid protests. 

The proposed 2017 National Defense Authorization Act (“NDAA”) includes a provision that makes two explicit changes to the GAO’s task order jurisdiction. First, the bill proposes eliminating subparagraph (f)(3) of 41 U.S.C. § 4106. This change will have the effect of reinstating, and making permanent, the GAO’s authority to hear any bid protest challenging the issuance of a task order issued in connection with a civilian IDIQ contract. Currently, GAO can only consider bid protests alleging that the order in question increases the scope, period, or maximum value of the underlying IDIQ contract. This is unreservedly good news for contractors looking to hold the government accountable to the mandates of the Competition in Contracting Act (“CICA”).

Less exciting is the other change Congress seeks in task order jurisdiction. In addition to reinstating civilian task order protest jurisdiction, the NDAA also proposes to raise the threshold value necessary before the GAO can consider a protest against a Department of Defense-issued task order. Currently, there is permanent jurisdiction for the GAO to hear any protest involving a DoD-issued task order valued over $10 million. The NDAA proposes more than doubling the current threshold, increasing it to $25 million. This could leave a broad swath of defense contractors out in the cold when it comes to challenging potentially defective task order awards.

It is worth noting that the 2017 NDAA is not law yet – although it reflects a harmonization of the House and Senate’s earlier efforts at drafting an NDAA, it still needs to pass a vote in both houses and be signed by the White House before the provisions discussed above become operative. While NDAA bills generally pass with relative ease, as this one did in the House on Friday, the current instability of the political climate in Washington means that anything is possible.

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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