Taking task orders to task

This post excerpts the gist of an informative "client alert" prepared by the US-based Pillsbury law firm. Please take the link to the full article if this is of interest to you.

For Now, Federal Contractors May Protest Any Civilian Agency Task/Delivery Order at GAO
Authors: Daniel S. Herzfeld, Jack Y. Chu

6/16/2011
Contractors may now protest any civilian agency task or delivery order under indefinite delivery/indefinite quantity ("IDIQ") contracts, the U.S. Government Accountability Office ("GAO") ruled on June 14 in denying an agency's request to dismiss the Technatomy Corporation protest. This ruling is important because GAO's limited statutory authority to hear protests of civilian task or delivery orders exceeding $10 million was viewed by many experts as having expired on May 27 without reauthorization from Congress.1

GAO's decision now begs three questions:

(1) Will Congress act quickly to re-institute the same $10 million protest limitation on civilian agencies that still applies to defense agencies?
(2) Will the U.S. Court of Federal Claims agree with GAO's analysis?
(3) Will the Executive branch honor GAO's unexpected opinion?

Until recent years, the Federal Acquisition Streamlining Act of 1994 ("FASA") had limited the GAO's authority over protests of task and delivery orders under IDIQ contracts only to cases in which the protest alleged that the order increased the scope, period, or maximum value of the contract under which the order was issued.2 Then, following enactment of the National Defense Authorization Act ("NDAA") for Fiscal Year 2008, GAO gained the limited authority to review task or delivery orders exceeding $10 million for both Department of Defense and civilian agency contracts. Congress placed a three-year sunset provision on such authority (i.e., a May 27, 2011 expiration date), in order to assess the impact of the protests on the federal procurement system before deciding whether to extend (or let expire) the authority.

Earlier this year, the enactment of the NDAA for Fiscal Year 2011 extended through September 30, 2016 GAO's supplemental authority over Department of Defense task and delivery order procurements exceeding $10 million. Notably, this legislation amended only Title 10 of the U.S. Code (covering military procurements) but not Title 41 (covering civilian agency procurements).

In Technatomy Corporation, the GAO interpreted the 2008 NDAA as having amended FASA such that the three-year sunset provision applied to the entire statutory subsection – 41 U.S.C. § 253j(e)3 – granting GAO the exclusive, but limited protest authority over civilian agency task and delivery orders exceeding $10 million. Following the sunset of this provision on May 27, the GAO concluded that its authority over task and delivery order protests was no longer statutorily limited, but instead "reverted" to its broader authority prior to FASA – during which the scope of GAO's authority to hear protests under the Competition in Contracting Act did not distinguish between protests of contracts and protests of task and delivery orders. Thus, GAO concluded in Technatomy Corporation that the sunset of the statutory provision "eliminates any bar to our jurisdiction to hear and issue decisions concerning bid protests arising from task or delivery orders of any value."