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GAO issues decisions regarding federal bid protests, appropriations law, and other legal matters.
Federal agencies are required to award government contracts in accordance with numerous acquisition laws and regulations. If a party interested in a government contract believes that an agency has violated procurement law or regulation in a solicitation for goods or services, or in the award of a contract, it may file a bid protest with our office. GAO provides an inexpensive and expeditious forum for the resolution of bid protests.
A bid protest is a challenge to the terms of a solicitation or the award of a federal contract. For more than 100 years, GAO has provided an objective, independent, and impartial forum for the resolution of disputes concerning the awards of federal contracts. GAO's Procurement Law Division adjudicates these bid protests.
Over the years, GAO's decisions on federal contract awards have created a uniform body of law applicable to the procurement process upon which the Congress, the courts, agencies, and the public rely. Although a party to a protest may be represented by counsel, filing a bid protest with GAO does not require the services of an attorney. In addition, bid protests filed with GAO are usually resolved faster than those filed in federal court.
The following frequently asked questions are intended for a general audience and should not be considered legal advice. Readers should be aware that many of the rules for filing and pursuing protests, as well as the substantive matters of bid protest law, are complex, and these FAQs are not intended to address all possible issues and situations.
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Overview
The Supreme Court held that the Department of Veterans Affairs’ (VA) set-aside law was mandatory and must be applied to all competitive contract awards, including orders on the Federal Supply Schedules. Awards must also be made to Veteran-Owned Small Businesses (VOSBs) verified as such by the VA.
On June 16, 2016, the U.S. Supreme Court ruled that consistent with Public Law 109-461 (38 U.S.C. 8127 and 8128), the VA shall award contracts based upon competition restricted to SDVOSBs or VOSBs when a contracting officer has a reasonable expectation, based on market research, that two or more firms listed as verified in Vendor Information Pages database are likely to submit offers and an award can be made at a fair and reasonable price that offers best value to the United States.
Background:
February 15, 2016
APTAC staff article
At long last, the Supreme Court is set on February 22, 2016, to hear Kingdomware Technologies, Inc. vs United States, which charges the US Department of Veterans Affairs with creating loopholes to avoid a statutory contracting preference for veterans. This is a critical moment for Veteran-owned and Service-Disabled Veteran-owned Small Businesses; fortunately, there are some tremendous resources- including real-time blogs and a free webinar recapping the oral arguments – for those wishing to stay informed.
At issue is the requirements of the Veterans Benefits, Health Care and Technology Act of 2006 (the “VA Act”) directed the VA to prioritize SDVOSBs and VOSBs in agency contracting. The VA Act directed the VA to establish annual goals for contracting with SDVOSBs and VOSBs. The VA Act then establishes a contracting preference for SDVOSBs and VOSBs, codified at 38 U.S.C. § 8127(d):
(d) Use of Restricted Competition.— Except as provided in subsections (b) and (c), for purposes of meeting the goals under subsection (a), and in accordance with this section, a contracting officer of the Department shall award contracts on the basis of competition restricted to small business concerns owned and controlled by veterans if the contracting officer has a reasonable expectation that two or more small business concerns owned and controlled by veterans will submit offers and that the award can be made at a fair and reasonable price that offers best value to the United States.
Elsewhere, the statute specifies that SDVOSBs are to be given top priority under this “rule of two” process; VOSBs have the second highest-priority. The SDVOSB and VOSB priorities created under the VA Act were widely viewed as a “Veterans First” policy under which veteran-owned businesses would be preferred for all VA procurements. But instead of applying the “rule of two” across the board, the VA has taken the position that it can buy goods and services using the Federal Supply Schedule without first considering SDVOSBs or VOSBs. The VA’s position has enabled the VA to circumvent SDVOSBs and VOSBs whenever goods or services were available on the FSS.
A number of bid protests in response to this practice have been upheld by the GAO, which stated in Aldevra, B-405271, B-405524 (Oct. 11, 2011) that the law was “unequivocal; the VA ‘shall’ award contracts on the basis of competition restricted to SDVOSBs where there is a reasonable expectation that two or more SDVOSBs will submit offers and award can be made at a fair and reasonable price.” But the Court of Federal Claims held that the VA had reasonably interpreted the VA Act, and the Federal Circuit court upheld that decision. The issue will now be heard by the U.S. Supreme Court.
https://www.aptac-us.org/news/supreme-court-determine-critical-vosb-sdvosb-contracting-issue/
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