LegiStorm

Summary:

On December 31, 2011, President Obama signed the National Defense Authorization Act for FY2012. This act amends Title 41 of the United States Code to extend the Government Accountability Office's (GAO's) jurisdiction over protests involving "large" orders issued under civilian agency contracts and clarifies that protests of such orders may not be heard after September 30, 2016, if this jurisdiction is not reauthorized (P.L. 112-81, § 813). Title 41's provisions regarding the protests of "large" orders previously had a May 27, 2011, sunset date. However, the language of these provisions was such that GAO and the U.S. Court of Federal Claims construed them to mean that they could hear protests of orders of any size issued under civilian agency contracts after May 27, 2011. These cases arose because of amendments that the Federal Acquisition Streamlining Act (FASA) of 1994 and the National Defense Authorization Act (NDAA) for FY2008 made to the Armed Services Procurement Act and the Federal Property and Administrative Services Act. Before FASA was enacted, GAO, the federal courts, and procuring agencies had jurisdiction over protests alleging that agency conduct in the issuance of orders under federal contracts was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law. However, FASA limited this jurisdiction, barring all protests regarding the issuance of orders except those alleging that the order increased the scope, period, or maximum value of the underlying contract. Later, the NDAA for FY2008 amended FASA to expand the grounds upon which the issuance of orders could be protested, authorizing GAO to hear protests of orders valued in excess of $10 million that did not increase the scope, period, or maximum value of the underlying contract. The NDAA for FY2008 also included a sunset provision, specifying that this "subsection" expired on May 27, 2011. Executive branch agencies and many commentators construed this language to mean that GAO's jurisdiction over protests of "large" orders expired on May 27, 2011. However, GAO and, later, the Court of Federal Claims disagreed. First, in Technatomy Corporation, GAO relied upon the statute's "plain meaning" to find that "subsection" meant the entirety of FASA's provisions regarding protests of orders, as amended, and not just the amendments made to these provisions by the NDAA for FY2008. According to GAO, what expired on May 27, 2011, were the limitations on its jurisdiction over protests that do not increase the scope, period, or maximum value of the underlying contract, as amended by the expansion of its jurisdiction to include protests of "large" orders. Thus, it concluded that it may hear protests of orders of any size issued under civilian agency contracts, regardless of whether the protest alleges that the order increased the scope, period, or maximum value of the underlying contract. Later, in Med Trends, Inc. v. United States, the court similarly relied upon the "plain meaning" of FASA, as amended by the NDAA for FY2008. However, the court also explicitly rejected the government's argument that the legislative history of the NDAA for FY2008 supported construing "subsection" to mean only those provisions of FASA granting GAO jurisdiction over protests of orders valued in excess of $10 million. These decisions would have resulted in protests of orders under civilian agency contracts being treated differently than protests of similar orders under defense contracts, and could also have increased the number of bid protests. The 111th Congress (P.L. 111-383, § 825) had previously amended Title 10 of the United States Code, which governs the procurements of defense agencies, with language identical to that in P.L. 112-81.