GAO Considers “Intertwined” Protest of Task Order Valued Below Jurisdictional Threshold

GAO’s bid protest jurisdiction is defined—and limited—by both statute and its regulations. As part of these jurisdictional limits, GAO ordinarily may only consider protests relating to task order procurements if those orders are valued in excess of $10 million.

But despite this rule, GAO recently considered a protester’s challenge to a task order valued at only $8.7 million. It did so after deciding that the challenge was “intertwined” with the protester’s challenge to its own termination for convenience–another matter the GAO only considers in unusual circumstances.

At issue in EA Engineering, Science, & Technology, Inc., B-411967.2 et al. (Apr. 5, 2016) was an award issued by the U.S. Army Corps of Engineers, under an RFP seeking environmental remediation services at three military munitions sites and an Army depot. The contract was issued as an IDIQ multiple-award task order contract.

The Corps evaluated six proposals under its initial evaluation. Of those six, all but two were excluded for receiving at least a marginal rating under one of the four non-price evaluation factors. From the two proposals eligible for award, the Corps selected EA as the best value and named it the awardee.

Following this initial award, one of the four excluded offerors—Engineering/Remediation Resource Group, Inc. (“ERRG”)—protested the evaluation and award decision. The Corps took voluntary corrective action in response to ERRG’s protest, which included establishing a competitive range (consisting of EA, ERRG, and one other offeror), entering into discussions with selected offerors, conducting a new price analysis, and making a new best value determination.

All three offerors submitted revised proposals. Under the new evaluation, ERRG was selected by the Corps as the best value awardee, due in large part to its significantly lower price (about $8.7 million, as compared to EA’s next-lowest price of approx. $14.6 million). The Corps then terminated EA’s initial task order for convenience.

EA protested the termination of its task order, arguing that the Corps unreasonably evaluated both its and ERRG’s proposals and made a flawed best value determination.

Before considering the merits of EA’s protest, GAO first considered its jurisdiction. By statute, GAO has jurisdiction to consider protests relating to a task order valued in excess of $10 million. See 10 U.S.C. § 2304c(e) (military procurements, including Corps of Engineers); 41 U.S.C. § 4106(f) (civilian procurements). The only statutory exception is for a protest “on the ground that the order increases the scope, period, or maximum value of the contract.” EA’s protest did not raise such challenges.  Thus, under this statutory threshold, GAO should not have had jurisdiction to consider EA’s protest of ERRG’s $8.7 million task order award.

But the facts of this protest were not so simple—EA also protested the termination of its task order, which exceeded the $10 million threshold. And though GAO generally does not review terminations for convenience, it nonetheless “will review such a termination where it is based upon an agency determination that the initial contract award was improper.”

GAO found that EA’s protest to its task order termination fit this exception. This finding further allowed GAO to consider EA’s protest relating to the award to ERRG:

Here, EA timely challenged the agency’s decision to terminate its task order after it reevaluated proposals and determined to issue a task order to ERRG instead of EA. While our Office would not ordinarily have jurisdiction to review the propriety of an award of an order valued under $10 million, the termination of EA’s task order is so intertwined with the decision to award an order to ERRG that we find no basis to separate the termination from the award. Thus, under these circumstances, we will review the reasonableness of the agency’s decision to issue an order to ERRG as part of our review of the reasonableness of the agency’s decision to terminate EA’s task order.

EA’s protest thus cleverly evaded GAO’s jurisdiction limitations: by protesting alleged improprieties concerning its task order, EA was able to properly challenge the Corps’ decision to terminate its award for convenience. Beyond that, its protest also “intertwined” its challenge to ERRG’s award, so as to compel GAO to consider those arguments, too. If protests were won and lost solely on skillful navigation of the jurisdictional requirements, EA would have emerged a clear winner.  But after determining that it had jurisdiction, GAO denied EA’s protest on the merits.

In EA Engineering, Science, & Technology, GAO pushed the limits of its statutory jurisdiction to consider arguments “intertwined” with those it had authority to hear. One wonders whether this “intertwined” jurisdictional exception will play out in future protests. Regardless of these future questions, though, EA Engineering, Science, & Technology shows that the GAO’s jurisdiction over bid protests isn’t always as simple as it might first appear.