[House Hearing, 119 Congress]
[From the U.S. Government Publishing Office]
______
BID PROTEST REFORM:
UNDERSTANDING THE PROBLEM
=======================================================================
HEARING
before the
SUBCOMMITTEE ON GOVERNMENT OPERATIONS
of the
COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED NINETEENTH CONGRESS
FIRST SESSION
__________
JULY 22, 2025
__________
Serial No. 119-40
__________
Printed for the use of the Committee on Oversight and Government Reform
[GRAPHIC(s) NOT AVAILANLE IN TIFF FORMAT
Available on: govinfo.gov, oversight.house.gov or docs.house.gov
U.S. GOVERNMENT PUBLISHING OFFICE
61-713 PDF WASHINGTON : 2025
COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
JAMES COMER, Kentucky, Chairman
Jim Jordan, Ohio Robert Garcia, California, Ranking
Mike Turner, Ohio Minority Member
Paul Gosar, Arizona Eleanor Holmes Norton, District of
Virginia Foxx, North Carolina Columbia
Glenn Grothman, Wisconsin Stephen F. Lynch, Massachusetts
Michael Cloud, Texas Raja Krishnamoorthi, Illinois
Gary Palmer, Alabama Ro Khanna, California
Clay Higgins, Louisiana Kweisi Mfume, Maryland
Pete Sessions, Texas Shontel Brown, Ohio
Andy Biggs, Arizona Melanie Stansbury, New Mexico
Nancy Mace, South Carolina Maxwell Frost, Florida
Pat Fallon, Texas Summer Lee, Pennsylvania
Byron Donalds, Florida Greg Casar, Texas
Scott Perry, Pennsylvania Jasmine Crockett, Texas
William Timmons, South Carolina Emily Randall, Washington
Tim Burchett, Tennessee Suhas Subramanyam, Virginia
Marjorie Taylor Greene, Georgia Yassamin Ansari, Arizona
Lauren Boebert, Colorado Wesley Bell, Missouri
Anna Paulina Luna, Florida Lateefah Simon, California
Nick Langworthy, New York Dave Min, California
Eric Burlison, Missouri Ayanna Pressley, Massachusetts
Eli Crane, Arizona Rashida Tlaib, Michigan
Brian Jack, Georgia Vacancy
John McGuire, Virginia
Brandon Gill, Texas
------
Mark Marin, Staff Director
James Rust, Deputy Staff Director
Mitch Benzine, General Counsel
Jenn Kamara, Senior Professional Staff Member
Jack Furla, Professional Staff Member
Bill Womack, Senior Advisor
Mallory Cogar, Deputy Director of Operations and Chief Clerk
Contact Number: 202-225-5074
Jamie Smith, Minority Staff Director
Contact Number: 202-225-5051
------
Subcommittee On Government Operations
Pete Sessions, Texas, Chairman
Virginia Foxx, North Carolina Kweisi Mfume, Maryland, Ranking
Gary Palmer, Alabama Minority Member
Tim Burchett, Tennessee Eleanor Holmes Norton, District of
Brian Jack, Georgia Columbia
Brandon Gill, Texas Maxwell Frost, Florida
Emily Randall, Washington
C O N T E N T S
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OPENING STATEMENTS
Page
Hon. Pete Sessions, U.S. Representative, Chairman................ 2
Hon. Eleanor Holmes Norton, U.S. Representative, Ranking Member.. 3
WITNESSES
Mr. Kenneth Patton, Managing Associate General Counsel, U.S.
Government Accountability Office
Oral Statement................................................... 6
Mr. Christopher Yukins, Research Professor, Government
Procurement Law, George Washington University Law School
Oral Statement................................................... 7
Mr. Zachary Prince, Partner, Haynes Boone LLP
Oral Statement................................................... 10
Written opening statements and bios are available on the U.S.
House of Representatives Document Repository at:
docs.house.gov.
INDEX OF DOCUMENTS
* Article, Orlando Sentinel, ``FL Disaster Pipeline Funnels
Millions to Politically Connected Contractors''; submitted by
Rep. Frost.
The documents listed above are available at: docs.house.gov.
ADDITIONAL DOCUMENTS
* Questions for the Record: Mr. Patton; submitted by Rep.
Sessions.
* Questions for the Record: Mr. Prince; submitted by Rep.
Sessions.
* Questions for the Record: Mr. Yukins; submitted by Rep.
Sessions.
These documents were submitted after the hearing, and may be
available upon request.
BID PROTEST REFORM:
UNDERSTANDING THE PROBLEM
----------
TUESDAY, JULY 22, 2025
U.S. House of Representatives
Committee on Oversight and Government Reform
Subcommittee on Government Operations
Washington, D.C.
The Subcommittee met, pursuant to notice, at 10:06 a.m., in
room HVC-210, U.S. Capitol Visitor Center, Hon. Pete Sessions
[Chairman of the Subcommittee] presiding.
Present: Representatives Sessions, Comer, Foxx, Palmer,
Burchett, Gill, Mfume, Norton, and Frost.
Mr. Sessions. Good morning. And welcome to today's hearing
on potential reforms to a bid process--protest process. This is
the hearing of the Subcommittee on Government Operations and
the Federal Workforce [sic], and we will come to order.
And I would like to welcome everybody.
Without objection, the Chair may declare a recess at any
time. And I would recognize myself for the purpose of making an
opening statement.
I understand the gentleman from Tennessee has a motion. The
gentleman is recognized.
Mr. Burchett. Thank you, Mr. Chairman.
I move to direct the Chairman of the full Committee to
authorize and issue a subpoena for Ghislaine Maxwell to appear
for a deposition.
Mr. Sessions. Thank you very much. That motion by the
gentleman from Tennessee, all those in favor, signify by saying
aye.
[Chorus of ayes.]
Mr. Sessions. All those opposed, signify by saying no.
[No response.]
Mr. Sessions. In the opinion of the Chair, the ayes have
it. The motion is agreed to.
The Committee will now resume its hearing. I thank the
gentleman from Tennessee.
Mr. Burchett. Thank you, Mr. Chairman, for your attention
to this matter.
Mr. Sessions. I recognize myself for the purpose of making
an opening statement.
OPENING STATEMENT OF CHAIRMAN PETE SESSIONS REPRESENTATIVE FROM
TEXAS
Mr. Sessions. And this is important today that we have
gathered together, and we have three important witnesses who
will help guide this Committee on what I believe is--should be
a regular process as part of the success to ensure that the
American people put trust in the Federal Government to spend
their taxpayer dollars wisely. And as we need to continue our
oversight to ensure, not only that, but also that we listen to
professionals who deal with these issues to provide us status.
In Fiscal Year 2024, the Federal Government spent about
$755 billion on goods and services through the contracting
process. And while there is significant focus on what Federal
agencies bought, we need to focus also on that process and how
they do so.
Part of the contracting process includes the mechanisms
known as a bid protest that serves to ensure government
procurements are competitive and fair. I believe this is an
important goal, so it is incumbent upon the Subcommittee, this
Subcommittee, Government Operations and the Federal Workforce
[sic], to review the bid process as part of our regular
oversight. And, indeed, we have looked at this process. We have
learned that there are concerns in feedback that must be
reviewed to determine whether changes to our system are in
order.
Critics of the current process say that the bid protests
have become ingrained in the solicitation and the award
process, with companies factoring in a protest as soon as the
contract is announced. Other critics say that contracting
officers are more concerned with creating the best paper record
to defend their decisions rather than achieving the best
results for the Federal Government and the United States
taxpayer. Supporters of the process who want reforms say that
delays are due to bureaucratic red tape at the procuring
agency; either the agency is too slow in developing
requirements or too slow to implement corrective actions.
While there are potentially a number of problems in need of
solution, it appears to me that the process may be
overutilized. This makes it difficult for agencies to get the
goods or services that they need, reducing their ability to
timely deliver on their mission. I am aware of a variety of
these issues that need to be considered.
So, is it too easy to protest? Can we maintain fairness
while requiring more stringent criteria be met before a
complaint can be filed? Are there too many bites at the apple
for those who protest? Timeframes are involved in that. If a
party does not like the results they get, are they bogging down
the system by relitigating what they really wanted in the first
place? Are there additional steps that can be taken before
solicitation is issued which would prevent protests once an
award is made? Should we adopt a ``loser pays'' approach, and
how would this work?
It seems to me that this and other solutions could reduce
and limit serial protesters who lodge a protest because they
have nothing to lose. That is why we are here today.
We are here today to ask three people who are deeply
involved in this process and have a vast background who are
able to help guide, not only this Subcommittee, but I believe
Members of Congress to where we understand more about the
process that we ask questions about.
As we examine this bid protest, as in the case with many
other issues, Ranking Member Mfume and I want to investigate.
We need to ensure that we have the right information to make
good decisions that, with your guidance, will help us, and I am
concerned we do not have those available to us, until today. We
have a lot of things that are stories. We have a lot of things
where people say things. Perhaps there is even a viewpoint
about--with an unsolicited amount of creative information or
information from those who are involved in the process who have
opinions. But these insights are all important, and if we begin
that story today with people who are in the know, who can guide
us, it is helpful.
The Trump Administration is committed to reforms, and here
in this Subcommittee, we are going to listen to that venue. We
believe the vehicle to do that is by an open hearing, one that
is not just matched with Republicans and Democrats, but good
government people, and that is what we believe we have on the
side of Republicans and our friends that are Democrats who are
here today who serve on this Government Operations
Subcommittee. We want to make sure that we are approaching
problems, issues, and ideas thoughtfully.
So, today we will hear from distinguished subject matter
experts who are in the field, who understand the problem, who
know that ultimately we want to make sure that we are reviewing
this to be thoughtful about what we are doing.
So, with that said, I would now yield to the Ranking Member
or his designee, which in this case would be Ms. Norton. Ms.
Norton, thank you very much. The gentlewoman is recognized.
Ms. Norton. Thank you, Mr. Chairman. And thank you to the
witnesses for being here today.
OPENING STATEMENT OF ELEANOR HOLMES NORTON REPRESENTATIVE FROM
THE DISTRICT OF COLUMBIA
Ms. Norton. On this Subcommittee, we have been steadfast in
our bipartisan work. Together, we have committed to identifying
solutions to longstanding challenges faced by our Federal
agencies, including improper payments, financial management,
and fraud prevention at the Department of Defense.
We have long recognized these issues that complicate the
efforts of Federal agencies to be the stewards of taxpayer
resources that Americans deserve. On this specific topic of bid
protest, however, it is essential that any changes we make to
the system are guided by data,--data that in some cases we do
not yet have.
The U.S. Government is the largest buyer of goods and
services in the world. It represents an important opportunity
for businesses offering solutions to that can help our Federal
agencies meet their goals in serving the American people.
The bid protest process plays an essential role for
preserving public trust by helping to prevent corruption and
unfair deals. It ensures that these doors of opportunity are
opened to businesses of all sizes and backgrounds and not just
those who are politically well connected. The bid process keeps
our Federal agencies accountable and guarantees that if you are
offering a good deal to the American public, your bid on
government work has a fair shot.
A fair and effective bid process also ensures that the
American people are getting value for their hard-earned money
by promoting robust and fair competition among contractors and
government businesses. The sense of fairness encourages the
innovative small businesses owned by veterans and minorities to
jump into this competitive process environment to offer their
services.
The immense volume of contracts awarded across the Federal
Government calls for special attention from Congress and
executive branch leaders. It is imperative that the DOD and the
Federal agencies are empowered to procure goods and services
efficiently. I do not believe this goal requires sacrificing
accountability by erecting overtly burdensome barriers to
contractors wishing to protest potential unfairness and
impropriety on the part of the government.
As we examine this issue today and as this Subcommittee
engages in efforts to reform our procurement system, several
aspects of the bid protest system should be top of mind.
First, according to Government Accountability Office (GAO),
bid protests are frequently successful in identifying a
problem, resulting in corrective action by the agency. The data
show that the majority of bid protests are valid. If we
undermine this process, we may get worse outcomes from our
agencies and unfair practices can go uncorrected.
Second, the number of contracts actually challenged through
bid protest is small. For example, less than two percent of DOD
contracts are protested every year. That number appears to be
decreasing in recent years. It is fair to ask why that issue is
a priority for reform in the face of other serious challenges.
Third, additional barriers to bringing a bid protest
threatens to unfairly and disproportionately affect smaller
businesses that have fewer financial resources. These are the
very businesses we should be incentivizing to work with the
Federal Government. We should not be driving them away by
reducing their recourse in the event of an improper process.
We hope that we can work together to look for ways to
reduce the need for bid protests by improving the procurement
bid itself. We should be encouraging agencies to take hard
looks at the results of their bid protests to see where they
went wrong and where they can do better next time. And we
should look for patterns in bid protests as blueprints for
legislative reforms that might be needed.
Reports by the GAO and other independent researchers
indicate that DOD does not collect the data necessary to
analyze the impact of bid protests on DOD procurements of
costs. It also does not systematically analyze the outcome of
bid protests to identify areas of concern and its procurement
processes. We cannot solve a problem we do not fully
understand. I hope we can get more of that understanding today
from our witnesses and continue to work together to find common
sense solutions.
I know my colleagues on this Subcommittee share my goal of
an efficient and fair government procurement system. I hope we
can continue to safeguard the bid protest process as the
important accountability mechanism that it is.
Thank you, and I yield back.
Mr. Sessions. Ms. Norton, thank you very much, not only for
your comments, but the expectation level that you have
established on behalf of the Minority that could be achieved
today. And I want you to know that I wholeheartedly agree, not
only with your comments, but your desire for us to continue
working together to see this issue in a way that will be in the
best interest of, not just the taxpayer, but the fairness that
will be seen by the public of the fairness behind the process.
And I want to thank you very much.
I am now prepared to move to our witnesses. I would like to
introduce them, if I could, please. I met with all three of
them and found them all three to be, not only professional
young people, but bring an expertise that I believe is
important to the hearing today.
First, Mr. Kenneth Patton is managing Associate General
Counsel at the GAO, the Government Accounting Office, where he
is responsible for heading and managing the attorneys and the
staff who resolve bid processes filed at the Government
Accounting Office.
Second, Mr. Christopher Yukins is a research professor in
government procurement law at George Washington University Law
School. He teaches on contract formations, bid protests, and
other issues in public procurement.
Last, Mr. Zachary Prince is a partner at Haynes and Boone,
which is a law firm. His practice encompasses all areas of
government contract law, and he counsels domestic and
international clients on a wide range of issues, including bid
protests.
So, I want to thank each of you for being here today, and
would ask that each of you please rise for the purpose of me
administering the oath of office--the oath to witnesses.
Pursuant to Government Reform Subcommittee, Committee Rule
9(g), the witnesses will please stand and raise their right
hand.
Do you solemnly swear or affirm that the testimony that you
are about to give is the truth, the whole truth, and nothing
but the truth, so help you God?
[Chorus of ayes.]
Mr. Sessions. Let the record show that the witnesses each
answered in the affirmative.
Thank you very much. You may take your seat.
We will now move to recognize our witnesses for the purpose
of making an opening statement.
I appreciate each of you being here, and let me remind the
witnesses that we have read your written testimony and it will
appear in full in the hearing record. I would also ask that you
recognize that I had a conversation with each of you yesterday
and would intend to treat you all fairly on the description of
the 5 minutes or the time that we yielded you. Each of you are
witnesses that are coming before this Subcommittee, and I am
not going to strictly hold you to 5 minutes. I am going to hold
you to the points that you would wish to make, your advice to
this Subcommittee, and the importance of us making sure that we
have an opportunity to ask questions back.
You will see that there will be Members who come and go,
but we are going to move forward.
As a reminder, please press the button on your microphone
in front of you when it is time for you to speak so that the
members can hear you. And when you begin to speak, the light in
front of you will move through the colors, green and then
yellow and then to red. But I would encourage you to, please,
make sure that the things which you would wish to discuss with
the Subcommittee are adequately performed.
I now recognize the distinguished gentleman, Mr. Patton,
for his opening statement. The gentleman is recognized.
STATEMENT OF KENNETH PATTON
MANAGING ASSOCIATE GENERAL COUNSEL
U.S. GOVERNMENT ACCOUNTABILITY OFFICE
Mr. Patton. Chairman Sessions, Ranking Member Mfume, and
Members of the Subcommittee, thank you for the opportunity
today to talk about bid protest and possible bid protest
reform.
The Competition in Contracting Act of 1984, or CICA,
establishes that GAO is to provide for the inexpensive and
expeditious resolution of protests. Consistent with this
authority, GAO resolves more than 1,000 protests every year,
all within 100 calendar days. However, over the last ten years,
the number of protests filed at GAO has steadily declined by 32
percent, and the number of protests filed at DOD has declined
by an even greater proportion, by 48 percent.
Notwithstanding that decline, the data from our annual bid
protest reports reflects that the effectiveness rate, that is,
the rate at which protesters receive some form of relief,
either as a result of GAO sustaining a protest or an agency
taking corrective action, has remained relatively stable at 50
percent.
Recently, section 885 of the National Defense Authorization
Act for Fiscal Year 2025 included a provision for GAO to
propose various possible reforms to the protest process, as
well as to create benchmarks of the costs of bid protests. In
this regard, while the benefits of the protest system in
promoting accountability and integrity in Federal procurements
are important, those benefits must be balanced against the
public's interests in allowing the government to efficiently
acquire the goods and services necessary to discharge their
obligations.
Section 885 included three provisions. First, GAO was to
consider enhanced pleading standards that protesters must meet
before receiving access to administrative records of DOD
procurements. Our regulations currently provide a robust
pleading standard, and protests that do not meet this standard
are dismissed, typically early in the process and prior to
receiving access to agency records.
While our current pleading standard allows us to dismiss
legally insufficient protests early in the process, we propose
to enhance our standard to make it clearer that protest
allegations must be credible and supported by evidence.
Second, section 885 included a provision for GAO to develop
benchmarks of the cost to DOD of resolving protests and the
lost profits of the awardee during the pendency of a protest.
However, during the preparation of our proposal, we found that
sufficient data was unavailable concerning DOD's protest costs
and lost profit rates to calculate reliable benchmarks.
For example, DOD does not track or record the cost of bid
protests because it is not statutorily required to do so.
Additionally, DOD expressed the view that given the low number
of protests of DOD procurements, the cost of tracking such data
would outweigh the benefits.
Third, section 885 required GAO to propose a process for an
unsuccessful protester to pay the government's protest-related
costs and contract awardees' lost profits. Without sufficient
data, however, it was not possible to create the benchmarks
envisioned by section 885.
GAO remains neutral on creating a fee-shifting process. We
believe that existing authorities are sufficient to efficiently
resolve and limit the adverse impacts of protests filed without
a substantial or legal factual basis. Consistent with the
requirements of section 885, however, we discuss two potential
processes and practical and policy implications for
congressional consideration.
First, Congress might consider a focused statutory
requirement for DOD to include a contract provision that would
permit DOD to recoup or otherwise withhold profit or fee where
an incumbent contractor filed a protest that is dismissed as
legally or factually insufficient.
Second, Congress might consider authorizing GAO to require
a protester to reimburse DOD for the cost incurred in handling
the protest, as well as any lost profits incurred by the
awardee whose contract was stayed during the pendency of a
protest.
The latter process would constitute a significant departure
from GAO's current statutory authorities and would require
significant structural changes to CICA and GAO's other
statutory authorities.
Chairman Sessions, Ranking Member Mfume, and Members of the
Subcommittee, this completes my prepared statement. I would be
pleased to respond to any questions that you may have.
Mr. Sessions. Mr. Patton, thank you very much. Your
detailed conversation with us was about 5 minutes and 10
seconds. Congratulations. Job well done.
I would now move to recognize Professor Yukins for his
opening statement. Mr. Professor, you are recognized.
Mr. Yukins. Thank you, sir. Chairman Sessions, Ranking
Member----
Mr. Sessions. If you could please push that button that is
right in front of you.
Mr. Yukins. Thank you, sir.
Mr. Sessions. Thank you, sir.
STATEMENT OF CHRISTOPHER YUKINS
RESEARCH PROFESSOR
GOVERNMENT PROCUREMENT LAW
GEORGE WASHINGTON UNIVERSITY LAW SCHOOL
Mr. Yukins. Chairman Sessions, Ranking Member Mfume, and
Members of the Subcommittee, thank you for the opportunity to
speak to you today on bid protest reform.
My name is Christopher Yukins, and I serve as the Lynn
David Research Professor in the Government Procurement Law
Program at the George Washington University Law School. Our
program is launched by Professors Ralph Nash and John Cibinic
in the early 1960s, and is one of the leading programs of its
kind in the world.
Although I am testifying today in my personal capacity, I
am proud to note that all of us testifying before you today are
connected with our program at GW Law School. Ken Patton is a
member of our board of advisors and Zachary Prince teaches on
negotiations in the program.
I have spent over three decades working on bid protest as
an academic and as a lawyer in Federal, state, and local
forums. I represented the United States in bid protest and
appeals as a lawyer in the U.S. Department of Justice. I worked
on several hundred protests as a private lawyer and as a
testifying expert. I helped author reports for the
Administrative Conference of the United States and the Defense
Department, at the request of Congress, on bid protest reform.
Finally, I serve as the academic advisor to the American Bar
Association's initiative to revamp the Model Procurement Code,
which is used by state and local governments across our Nation.
And that reform of the Model Procurement Code will almost
certainly lead to improvements to bid protests at the state and
local levels here in the United States.
The good news is that bid protests in the U.S. Government
are healthy and well-established. Indeed, they are a model for
the world. And I just note, Mr. Chairman, that our procurement
system--our procurement law system started in the Revolutionary
War. It is exactly 250 years old. It is a real mark of success
of our Nation. And we have a much longer established
procurement system than any other country in the world, that I
am aware of.
The structure of our bid protest system which--with
protests before the agencies, an independent agency such as
GAO, and the courts--is seen in governments around the world.
American companies working abroad regularly rely on other
countries' bid protest systems, which in many ways track the
U.S. model, to ensure they are treated fairly by other
governments and may turn out to be very important for Members
of the Subcommittee.
The European Union has talked about launching a retaliatory
weapon in the ongoing tariff discussions, and that will
specifically focus on public procurement. So, the strength and
fairness of bid protest systems on both side of the Atlantic
will be very, very important if that happens.
Many international trade agreements and conventions which
the United States has joined, such as the World Trade
Organization's Government Procurement Agreement and the U.N.
Convention Against Corruption, specifically call for effective
bid protest systems.
Bid protests have proven effective nationally and
internationally because they allow those with the best
information on procurement failures, typically other bidders,
to bring procurement failures to light. Those protesting
bidders, in essence, serve as whistleblowers on fraud, waste,
and corruption. Impairing protests--in essence, discouraging
those whistleblowers--would undermine bid protest core goals,
which are, one, to reinforce competence in the competitive
process, and two, to identify management failures in the
procurement system.
Bid protests can be flash points of contention between the
agencies and industry, and have long been the focus of reform
efforts. Those reform efforts are often quite useful.
Sometimes, though, they could have serious and negative
unattended consequences.
In my written testimony, I have addressed several of the
current proposals. The first is the value of two-bite protests
that may be heard both by GAO and the courts. And I mentioned--
for members of the Subcommittee, I mentioned that I have done
hundreds of protests. I have only had two two-bite protests or
two--where that came up, whether or not we should go from GAO
onto the Court of Federal Claims. One of them was, for tactical
and legal reasons, it was appropriate to abandon the GAO
protest and go to the court.
The other time it occurred, actually, was we earned a GAO
protest, we lost the GAO protest, but something smelled funny.
Something smelled funny. Well, as a lawyer you get that
instinct, this smells weird. But we did not--we were thinking
about whether or not to go to the court because you get a more
complete record of the court, but in the meantime this company,
the opposing company, which was one of the leading companies in
the United States, was raided by the FBI because, in fact,
there was something corrupt going on.
So, the two-bite protest can be very important to
preventing tactical circumstances but also just when there is
basic issues of whether or not enough of the record has been
produced at the GAO process.
I also address in the written testimony whether incumbent
contractors challenging new contracts are really a problem in
the procurement system, and if so, whether GAO and the courts
already have the tools necessary to address that problem.
Just note for the Subcommittee that you are going to hear a
lot of statistics on where we are in bid protest, that could
change dramatically in the next few years. With artificial
intelligence, it is possible that we could have an explosion in
the number of bid protests. Also, there was, in Sweden you can
actually buy insurance. As a company, you can buy insurance for
bid protest. The companies in Sweden bring many more bid
protests because the insurance companies pay for them there.
So, with that possible explosion bid protest, any reforms
have to accommodate a system with many more bid protests going
through. That just could be a reality coming down the road.
In my written statement, I discuss whether meritless
protests truly clog the system given the high standards of
proof imposed by GAO and the courts. I suggest a protesting
company should not be required to post bonds, as that would
only further burden the system and so discourage whistleblowing
by protesters.
The bond requirement is something that has existed for a
number of years in the United Kingdom. And when you bring a bid
protest in the United Kingdom, you have to oftentimes post a
very high bond. Many people view that as a serious barrier to
bid protest, rendering the entire system ineffective, arguably.
I suggest that protests can and should be put on more
rigorous timetables, as, Mr. Chairman, you referred to, both of
the agencies and the courts. I also speak to promising
potential reforms and expanded debriefings for losing bidders,
which would help reduce protests in the civilian agencies.
As we discussed, for me as a lawyer, the epiphany was, I
worked on, with a major, major--one of the top five defense
contractors. I worked on a billion dollar task order, and we
reviewed a thorough, a 100-page-plus debriefing from the
Defense Department agency involved, it was a billion dollar
task order, as I said, and the company, although we told the
company they had clear grounds for a protest, they could win on
a protest at GAO, the company decided not to protest its loss
on a billion dollar task order because they had a complete
statement, 100-page statement, of why the agency had reached
its decision, and they said, you know what, we disagree with
this, but we are not going to protest.
And part of that was because, with the expanded debriefing,
the managers on the procurement were able to turn to their
senior managers and explain what happened because they had the
documentation.
So, what all three of us will be talking about today, one
of the key reforms is taking that reform, taking those expanded
debriefings and extending them not just from the Defense
Department, but to the civilian agencies as well.
I am also going to be talking about--I also spoke in my
written testimony about agency-level bid protests. I have
written a couple reports on that, as I mentioned. And agency-
level bid protests are really not used now to any extent, and
they would be a good and efficient way of moving forward with
the system, making it possible for agencies to handle protests
themselves.
With that, Mr. Chairman, mindful of my time, I would like
to address--I would be glad to address any questions the
Subcommittee may have. Thank you, sir.
Mr. Sessions. Professor Yukins, thank you very much, and
for taking me up on explaining the things which you believe
would be important for this Subcommittee to hear. Thank you
very much.
Next, we move to Mr. Prince. Mr. Prince, happy birthday.
The gentleman is recognized.
STATEMENT OF ZACHARY PRINCE
PARTNER, HAYNES BOONE LLP
Mr. Prince. Thank you, Mr. Chairman.
Mr. Chairman, Ranking Member, and Members of the
Subcommittee, thank you for having me today to speak on this
important issue of bid protest reform.
As the Chairman mentioned at the outset, the U.S.
Government spends roughly $750 billion a year on government
contracts. That is three-quarters of a trillion dollars
annually. We must have a way to ensure integrity, transparency,
and fairness in how the rules of the game are established and
enforced.
The way we do that is by empowering interested parties to
challenge governmental decisions before an impartial reviewing
board. That provides the critical oversight to keep the system
honest. It allows small businesses and new market participants
confidence that they are on an even playing field with the
large, experienced government contractors. The bid protest is a
way for these companies to ensure they are given a fair shake
and that the government has fully considered novel or
commercial solutions to its challenges. And this may be part of
why small businesses, in fact, file most bid protests.
The system can be frustrating. There is no doubt about it.
There is nothing as annoying for an acquisition professional in
the government as having their decisions second-guessed.
Completely get that.
For a company that is awarded a government contract, being
told they need to wait and cannot do anything, while a
competitor lodges what they believe is arguably a meritless
dispute, is, of course, frustrating as well. But despite the
perception, protests are infrequent and effective, and they are
growing less frequent and more effective as time goes on.
Only a miniscule fraction of contracts are protested. The
RAND report in 2017 said that that was a third of a percent of
DOD awards, that it might be closer to one percent, depending
on how you calculate it, but we are still talking about a
really small amount of government contracts.
And, in fact, most GAO protests, over 50 percent, are
effective. In other words, in more than half of protests, there
is enough of a perception of significant error that GAO either
rules in favor of the protester or recommends to the agency
that they take action in favor of the protester, or the agency
takes the opportunity to do so itself.
There are undoubtedly abuses of the system, but the data
suggests that those abuses are rare, and remedies are already
built into the system. GAO can and has in rare instances
blocked protesters from filing new protests. The court can and
has imposed sanctions in the Court of Federal Claims. Bonds at
the court are already available upon request. And if the agency
has a compelling reason to proceed regardless of the protest,
it can and will go ahead with contract award and performance
regardless of the protest having been filed. It just has to
document it and justify it.
At bottom, protests are already expensive. For somebody to
file a protest at GAO, it typically costs well in excess of
$100,000. The Court of Federal Claims, that can be double that
figure.
Contractors understand the frustrations with the system.
They understand that costs are involved. They understand there
is a risk of irritating their customers. And they take the
decision to protest very seriously and, in my experience, quite
rarely, and the data bears this out.
Given the critical role that protests have in ensuring
public funds are spent fairly and small businesses and new
market participants have an opportunity to participate
meaningfully, Congress should expand the protest remedy and
cutoff meaningless disputes about venue, specifically by
addressing, as I note in my written testimony, task order
protests; extending the jurisdiction of the Court of Federal
Claims; and explicitly recognizing jurisdiction for protests
involving other transaction authorities, which are a wonderful
mechanism for government advancement of important goals but can
go--involve billions of dollars annually and could go overseen
without explicit guidance.
Congress should also expand the enhanced debriefing
requirements. DOD adopted this about a decade ago for certain
procurements. It has been remarkably effective at stopping
protests. By showing that an agency meaningfully considered the
offers and complied with its rules, showing disappointed offers
that the agency took their offer seriously, followed the rules,
even if the offers would disagree with the way the agency did
that, stops protests, because it shows that the protests maybe
are not likely to prevail, throwing good money after bad. The
contractors are savvy to that issue. This has been effective at
DOD. It should be extended to civilian agencies as well.
The protest system has issues, but it is the best way that
we know, at the moment, to oversee the procurement system
meaningfully, and any changes need to be considered very
carefully for risk of unforeseen consequences, such as raising
barriers for small businesses, and preventing meaningful issues
from being raised and addressed.
This concludes my prepared statement. I am glad to answer
any questions.
Mr. Sessions. Mr. Prince, thank you very much.
All three of you have provided this Subcommittee with, not
only professional advice, but each of you are appreciated for
being here.
We now move to the Member questions. I would like to
recognize the distinguished gentleman from Tennessee, Mr.
Burchett. You are recognized for 5 minutes, sir.
Mr. Burchett. When you said distinguished gentleman, Mr.
Chairman, I was not sure who you were talking about, but I
appreciate it. In my six years of Congress, I believe this is
the first time I have ever gotten to go first. I thought maybe
some of my Democrat friends were right, the rapture did come
and I was left behind, but I see there is some more folks out
there that think like I do, so I think we are okay.
Mr. Prince, do you think it would be beneficial for the
Government Accountability Office to be more transparent about
the bid protest evaluation process for businesses?
Mr. Prince. I do. And I think it would be very helpful for
GAO to continue its practice of publishing dismissal decisions,
which it has done more of. There has been a lot of talk in the
bar about whether they should also allow access to the public
to the docket, not just the listing of filings, but the
redacted pleadings. I do think that would be helpful just to
understand what arguments have been successful, how they have
been presented, and that would give agencies a better insight
into how to fix things in the front end.
Mr. Burchett. Don't you think that the people, for good
reason, think this town is crooked as a dog's leg, literally,
and, you know, every time we attempt to brush something aside,
it just seems to create more controversy, and then we have to
go back and correct it. I just--transparency has never really
been a problem with me, and I appreciates that answer, sir.
Mr. Yukin, did I say that name right? Yukon or Yukin? How
do you say it?
Mr. Yukins. Yukins. Yukins, sir.
Mr. Burchett. Okay. Well, Burchett, they massacre my name
every day of the week, so we are good.
Are there any current laws or regulations in the bid
protest process that place unfair burdens on these businesses
and stifle economic prosperity?
I see this a lot with the smaller folks. When I was county
mayor, the big boys could role in with their attorneys, you
know, some out there just hustling. Maybe a small minority
company has a lot of difficulty with this thing, and I was very
concerned about that. Could you address that, sir?
Mr. Yukins. Yes, sir. Actually, ironically, it is at the
other end of the spectrum. And as the Chairman mentioned, there
is a need to align with what the Trump Administration is doing.
The Trump Administration and Senator Wicker, Chairman Wicker on
the Senate side, are clearly, sir, going to be using other
transactions more, Mr. Prince alluded to.
There is--other transactions are--it is an oddly named
thing, but it basically means starting from scratch. You throw
the whole procurement system out the window and you write from
scratch. That creates a lot of problems.
We teach contracting officers. About a third of my students
are contracting--midlevel contracting officers. They have no
idea how to negotiate these things, whereas their private
counterparts really do. So, in many ways the irony here is it
is not the small businesses, it is the government that is at
the disadvantage in other transactions for the reasons you
talked about, about public credibility and legitimacy. Very
important, as Mr. Prince said, to have as much transparency and
accountability as possible in other transactions.
They are a good idea. Other transactions are a good idea
because they allow private capital to come in much more
aggressively, much more successfully than in the traditional
procurement process. So, other transactions is a good idea, but
we have to have transparency, we have to have accountability.
Thank you.
Mr. Burchett. All right. Finally, Mr. Patton, how often do
contractors pull their cases from the Government Accounting
Office and file new cases with the U.S. Federal Court of
Federal Claims? And probably just give me an estimate. I know
you cannot say specifically.
Mr. Patton. Actually, unfortunately, you are right, we
cannot say specifically because we do not actually have the
insight into the data about what cases go from GAO to the
court.
But what I can say is, typically, the Court of Federal
Claims has anywhere from 200 to 140 cases a year. Probably
about half of those may have had some prior life at GAO.
Mr. Burchett. Do you have any idea what the percentage of
bid protests are meritless? Just off the top of your head, give
me a ballpark.
Mr. Patton. Our sustain rate indicates 16 percent we
sustain. We have an effectiveness rate of 50 percent, which
means that there is something wrong in procurement, so the
agency takes it back. For those decisions that go to a merit
decision, the opposite of the 16 percent, those that we deny
probably do not contain a winning case or the protester was not
able to demonstrate a violation of law regulation that would
have had an impact on the award.
Mr. Burchett. Okay. Okay. Real quickly, rapid fire, I am
about out of time, which legislative proposals would be the
most beneficial for Congress to implement to reform the bid
process--bid protest process? Mr. Patton?
Mr. Patton. I would say get the data that you need to
identify the correct problem, because right now----
Mr. Burchett. All right.
Mr. Patton [continuing]. There is no real accuracy.
Mr. Sessions. Out of time. Mr. Prince?
Mr. Prince. I think the enhanced debriefing, extend that
out to civilian agencies.
Mr. Burchett. All right.
Mr. Yukins. Absolutely concur, enhanced debriefing.
Mr. Burchett. Thank you, Mr. Chairman. As usual, this is
not the sexiest committee, but it is the one that gets down to
work. I appreciate you. Present company excluded, of course.
You are down there wearing something from the Jim Jordan
collection, I see, no jacket, so you are up on the sexy chart
now, Mr. Chairman. Thank you so much for this opportunity.
Mr. Sessions. Mr. Burchett, thank you very much. I
appreciate being somewhere on the list, and I appreciate your
help.
We have now moved to the distinguished gentleman, my dear
friend from Maryland, the Ranking Member, Mr. Mfume. The
gentleman is recognized.
Mr. Mfume. Mr. Chairman, thank you very much.
I want to thank Mr. Burchett also for sharing some
important information, and for his earlier action in the
Subcommittee today. And I mean that sincerely. Thank you.
Mr. Chairman, I would be remiss if I did not at least also
thank the gentlewoman from the District of Columbia, Ms.
Norton, for opening up for this side of the aisle, and for her
ever present work on this Committee. And thank you, sir, for
calling this hearing.
I want to just get a little bit of clarity more than
anything else. I have gone through much of your written
testimony.
Mr. Patton, I think I want to start with you so that I am
clear. Did I hear you say that if a bid protest fails, that the
DOD could or should seek compensation, and if that were not the
case, perhaps GAO should do that?
Mr. Patton. I think what we, at GAO, said with regard to
section 885 is that DOD does not collect data to determine what
the cost to DOD would be to recoup that amount, nor do they
collect data from the awardee to determine what lost profits
would be. There could be a lot of administrative and legal
concerns or issues to making a loser pay.
Mr. Mfume. Why don't they collect the data?
Mr. Patton. That is a good question. From their
perspective, they are not statutorily required to do so. And in
their view, the benefit of collecting the data--excuse me--the
harm, the effort outweighs the benefit to collecting that data.
They do not see a need since protests at DOD are trending
downward.
Mr. Mfume. Well, one thing that is trending at DOD is that
they failed seven straight audits year after year after year,
and this Committee continues to point that out. So, if in this
case they do not see it in their interests or they do not have
statutory authority to do so, I just think they need to look at
the handwriting on the wall. Things are pretty much going south
with respect to DOD.
What about the GAO's role in this? Do you see that if they
are not doing it because they don't have statutory authority,
that you could, should, or are doing it?
Mr. Patton. GAO probably could not do it because access to
contractor data like that would require some mechanism to look
at it, to require the contractors to provide it. They do not
currently do so. So, it would be a challenge for GAO to do it.
Mr. Mfume. Then what would you suggest be put in place for
them to at least provide GAO with that additional information?
Mr. Patton. Initially, I think that the Department of
Defense would need to collect the data. And then, as you may
know, the Department of Defense's financial systems are on
GAO's high-risk list because they have an inability to manage
their financial system. So, there could be some additional
financial challenges for DOD in trying to accomplish that.
Mr. Mfume. Yes, they are just running things terrible at
that agency, and yet, this Congress just voted a 13 percent
increase to what is already the largest slice of our budget.
And we cannot even get a clean audit, and they continue to be
on the watch list. Thank you very much.
Mr. Prince, you, I think, suggested that--or said, I should
say, 50 percent of the bid protests that GAO looks at, they get
dismissed. Is that right?
Mr. Prince. No. It is that 50 percent are deemed effective,
so----
Mr. Mfume. Are deemed effective or ineffective?
Mr. Prince. Effective.
Mr. Mfume. Effective. Okay.
Mr. Prince. So, in other words, in 50 percent of cases,
either it goes to a decision from GAO ruling in favor, or
recommending the agency take action in favor, or the agency
voluntarily takes corrective action.
Mr. Mfume. And what happens to all the others? They just go
away?
Mr. Prince. They either lose--I mean, they can go to a
decision or lose, or sometimes you get into the record, I have
had this experience personally, and you see there is nothing
there and you pull it because it is just not worth throwing
more good money after bad.
Mr. Mfume. Now, I got a sense from you that you thought
that bid protests are not out of control and are not
ballooning. Is that correct?
Mr. Prince. That is correct.
Mr. Mfume. So, how would you reconcile that with Mr.
Yukins' statement that we ought to be on the lookout for what
is happening with artificial intelligence?
Mr. Yukins, I think you said there will be an explosion in
bid protests, if I am correcting--or correctly referencing what
your testimony is. Is that correct?
Mr. Yukins. Yes. There could be an explosion with
artificial intelligence or the way that people fund bid
protests changes. What I was getting at, sir, was that if
there--it is important that any solution that Congress brings
to this process be one that does not create clunky solutions,
because if we have a system that is expanding very rapidly and
we have clunky things built into it, well, the system could
collapse.
Mr. Mfume. So, on another part of that, you do support
expanding debriefings. Is that correct?
Mr. Yukins. Yes, sir, absolutely. It is a way--it is a very
cheap and effective way, and, again, with artificial
intelligence, it becomes easier and easier to redact the
documents. If you have 100-page document, very quickly
artificial intelligence can pick out what is confidential and
then the document can be produced to the bidders.
Mr. Mfume. And, Mr. Prince, you also support expanding the
debriefings?
Mr. Prince. I do.
Mr. Mfume. Okay. Mr. Chairman, I have no more questions.
Thank you.
Mr. Sessions. Thank you very much.
We now move to the distinguished gentleman from Texas. The
gentleman, Mr. Gill, is recognized for 5 minutes.
Mr. Gill. Thank you, Mr. Chairman, and thank you to the
witnesses for being here and taking the time.
Mr. Patton, I would like to start with a few questions for
you. My understanding is that GAO serves as an arbiter of bid
protest challenges, but the decisions are nonbinding. Is that
correct?
Mr. Patton. Yes, sir, that is correct.
Mr. Gill. What is the rationale for contractors to use the
GAO as a venue for bid protests given that they are nonbinding?
Mr. Patton. One of the benefits of the GAO bid protest
system is that, if you file within certain timeframes, you get
what is called an automatic stay of performance, meaning that
the agency cannot move forward with awarding or performing the
contract. That allows GAO time to administer and resolve the
protest. That is one of the chief benefits of filing at GAO.
Mr. Gill. Got it. Do you think the GAO would like those to
be binding, those decisions?
Mr. Patton. I think GAO recognizes that there are some true
separation of powers issues. Since GAO is a legislative branch
agency, we do not want to be perceived as overstepping our
lane.
Mr. Gill. Right. Do you think it would change the landscape
if they were?
Mr. Patton. I think there would be significant questions
that would need to be resolved if GAO were given authority or
asked to do things that might be perceived to be an executive
function.
Mr. Gill. Got it. And can you provide a couple of examples
of some more egregious examples of companies' bid protesting?
Mr. Patton. In what context? We have protests where we have
sustained protests. We have protests where we have denied.
There have been some instances, as I think alluded to before,
we did have a VEXIS protester who filed numerous, what we might
consider, meritless protests, and we debarred that individual
company from filing protests at GAO.
Mr. Gill. Do you see that happen often?
Mr. Patton. Not at all. Actually, that was an anomaly. And
since 2018, when we have implemented our electronic protest
docketing system with an attended filing fee, we have seen a
drop in protests and a drop in repeat filers.
Mr. Gill. And that is what I was about to ask you. It seems
like the current process has the potential to create delays
because contractors would file with the GAO first, withdraw
their case when they anticipate losing, and then subsequently
initiate a new case with the Court of Federal Claims. And you
are saying that does not happen often. Is that correct?
Mr. Patton. Do not have the data to answer that question,
but what I can say is the Court of Federal Claims has around
200 or so cases. So, if that is happening, it is happening in a
very, very small number of cases.
Mr. Gill. Got it. Do you think that this process should be
reformed in any way?
Mr. Patton. I think that if there are legitimate questions
that people have about its efficacy, those ought to be
explored. And to the extent that there are concerns, they
should be addressed. But I do think that we do need the data to
support whatever concerns might be identified.
Mr. Gill. Based on your experience, what changes would you
like to see?
Mr. Patton. Right now, we do think that the system is
operating as intended. I think that it is--we have not seen any
need to initiate any reforms. That does not mean that we cannot
do so if some are, in fact, identified.
Mr. Gill. Got it. Thank you, Mr. Patton.
And I yield the remainder of my time to the Chairman.
Mr. Sessions. Thank you very much. The gentleman now has
yielded back his time.
I would like to amplify, if I can in the remaining minute
and 30 seconds, the admiration that I have for each of you, all
three of you, to come and engage this Subcommittee. There are
always public comments, there are always public perceptions
about bids, processes, fairness, the processes involved in
that, and I have found that in speaking to each of you three
who are deeply involved in this process, that you are providing
this Subcommittee with your feedback, notwithstanding there are
Members who have offered some bit of a challenge to that, and
sustained not only where we are but what we are attempting to
do.
I will speak to it on my 5 minutes, but I wanted to use
these 42 seconds remaining to let you know that I see little
difference between you when you all talk about the system,
except to say that you want it to remain fair. You want it to
remain something that is a part of a public discussion. You are
open not just to feedback but that you find that the openness
by each of the agencies as they go about their business is
properly performed by GAO, that GAO has a part in that process,
and that outside counsel or these companies have knowledge.
And I want to thank you. And I think that Mr. Gill started
to get at that by asking the question, well, do you need any
changes? And I think that what really happened is Mr. Patton
clearly said there are perceptions, there are ideas out there,
but in their review, please make sure you address those before
you go change anything.
And I want to thank the distinguished gentleman from Texas.
We now yield back the time and move to the gentlewoman from
Washington, D.C., for her 5 minutes. The gentlewoman is
recognized.
Ms. Norton. Thank you, Mr. Chairman.
The government should get the best value for taxpayers when
contracting with businesses for goods and services. To do so,
it is important that government offices have an experienced and
qualified workforce that knows how to investigate our complex
system of procurement laws and regulations. Unfortunately, this
Administration has instead seen fit to gut the Federal
workforce and its experienced workers.
Secretary Hegseth has announced plans to reduce the
Department of Defense personnel by tens of thousands,
threatening to undermine institutional knowledge among Defense
Department procurement professionals. As a result, this
Administration's capricious and cruel policies--of their cruel
policies, we are losing valuable expertise every day. These
cuts are deliberately undermining government efficiency's
ability to achieve their missions, including complex
procurements.
Mr. Prince, in your experience, how important is it for
agency procurement officials to have the right experience and
training?
Mr. Prince. Congresswoman, it is absolutely pivotal. In
order to have any meaningful procurement changes that have been
proposed in a broader sense, to have an effective acquisition
system, we need well-trained acquisition workforce members.
Ms. Norton. Thank you, Mr. Prince.
Another question for you. How do you expect the cuts we are
seeing in the Federal workforce to impact agency procurements
and bid protests?
Mr. Prince. It remains to be seen. I would not be surprised
if it starts causing delays in certain agencies. I know it is
already causing delays in contract awards in some agencies and
that this may have a trickle effect into an increased number of
bid protests. The data next year I think will be very
interesting to see.
Ms. Norton. It is clear that this Administration is not
making the procurement system more efficient and transparent.
In fact, it is doing the opposite. Congress must do everything
we can to protect the capacity of our Federal workers as well
as the integrity of the procurement process.
And I yield back.
Mr. Sessions. The gentlewoman yields back her time. Thank
you very much.
We now move to the distinguished gentlewoman, Dr. Foxx. Dr.
Foxx, you are recognized for 5 minutes.
Ms. Foxx. Thank you, Mr. Chairman. And I thank our
witnesses for being here.
This is a question for each of the witnesses. And I do have
several questions, so I will ask you to be as succinct as
possible.
Under current law, bid protests may be filed in one of
three venues: the GAO, the contracting agency itself, or the
U.S. Court of Federal Claims, COFC. However, the data shows
that most protests are filed with the GAO or an agency but not
with the COFC. Why is this the case, and what are the
implications of this, quote, venue shopping?
We will start here. Mr. Patton?
Mr. Patton. We do not actually have data to determine why
individuals shop or move between forums. And, as I mentioned
earlier, one of the benefits of the GAO system is that you get
an automatic stay of contract performance. That is an easy way
to stop. If you go to the court, you may have to litigate that.
Ms. Foxx. Okay. Mr. Prince?
Mr. Prince. Yes. One advantage of GAO is the agency is
still in charge of the way the protest proceeds. So, if there
is corrective action to be taken, they might take it quicker.
But the record also is more truncated. So, you might just go to
the court if you think you are going to get piecemeal record
and you really need something bigger.
Mr. Yukins. Ma'am, Mr. Prince alluded to this before, but
in response to the study that GAO is doing under section 885 of
the Defense Authorization Act, GAO asked the bar how much it
cost to--for an awardee to defend a protest. As Mr. Prince
alluded to, it is--the data, it is very gross, it is very high
level. It is not enormously precise, but it was about $100,000
with GAO and about $200,000 with the Court of Federal Claims.
So, a contractor is facing twice as many costs if they
decide to go to the Court of Federal Claims. And that is one of
the major reasons that they decide to go to GAO instead.
Ms. Foxx. Okay. I understand the lack of data, but you just
mentioned the cost. Is there any data to tell us whether there
is a more favorable outcome at one of those places than
another?
Mr. Yukins. The best outcome--there has been academic
studies on this, ma'am, that the best outcome is actually not
to win a protest, because if you win a protest, you actually--
at that point, the agency is so angry at you that you are not
likely to win the contract.
Ms. Foxx. Right.
Mr. Yukins. The best outcome is to come in hard and strong
at GAO and get corrective action taken by the agency. That
statistically is the--that is the optimal outcome.
Ms. Foxx. Okay. I am going to submit my next question for
the record.
Mr. Prince, what information would be helpful for
contractors, particularly small businesses, to understand the
merits of a potential bid protest?
Mr. Prince. So, I think the most effective thing to do
would be to provide a unredacted source selection document;
that is, a document providing to outside counsel or to in-house
counsel, under protective order or nondisclosure agreement,
clear information on the deliberative process.
Ms. Foxx. Transparency is always good.
In your opinion, if Federal Government were to provide
additional information to bid protesters, such as enhanced
debriefs, would the number of frivolous bid protests decrease?
Mr. Prince. I think generally, yes. And I think that is
part of why it has gone down over the last decade.
Ms. Foxx. And again, I will ask this question of all three
of you. If we do not have time, then I will ask you submit your
answers for the record.
What are your suggestions for bid protest reforms that can
reduce costs to frivolous protests, and how can these reforms
ensure that legitimate protests are allowed to proceed? Mr.
Patton?
Mr. Patton. I would say that the agencies need to collect
data and determine whether or not they think a protest is
meritless or not and provide that data to the Congress.
Ms. Foxx. Mr. Prince?
Mr. Prince. I think greater access to information at the
outset to potential protesters.
Mr. Yukins. I agree in terms of enhanced debriefings.
One of the important things to understand, ma'am, is that
ours is a very concentrated system. We have a concentrated
Defense Department, very concentrated market. The bar, there is
only--in Hungary, they have 2,000 procurement lawyers. In the
United States, at the Federal level, we only have about 500. It
is not because the Hungarians are smarter. It is because we
work as a very tight community, and people act very responsibly
as a result.
So, if we had more information through debriefings,
responsible, well-trained lawyers will be working with
responsible, well-trained contractors and they will decide not
to protest.
Ms. Foxx. Thank you, Mr. Chairman. I yield back.
Mr. Sessions. Thank you very much. The distinguished
gentlewoman, Dr. Foxx, yields back her time.
I would now yield myself such time as I may consume.
I want to thank each of you for being here today. I found
this process that I had to go through as a Subcommittee
Chairman most informative, because I think the gentleman, Mr.
Patton, alluded to conversations, thinking that people have,
perceptions that they may even express without enough
information to satisfy a balanced answer.
And I have attempted, with each of you, to ask questions
that enabled you, allowed you, and provided you a chance to
respond back, and each time, I have found that all three of you
provided a balanced answer back that said the system
understands this, the system takes this into account, and the
system is flexible enough to be able to produce what might be a
balanced answer. And I want you to know that the American
people have a lot to learn about what you have provided me
today.
I think that the important part that I have learned out of
this--or perhaps in my interaction with you, because I talked
to all three of you about it, is the ability to make sure that
we teach to agencies their responsibilities. And that you have
all told me that, based upon the effectiveness of an agency to
guide those people through a process, not only how it will
happen but what those expectations are, produces a better
result where, even if a person does not win a bid process, they
understood more about the facts and factors related to that.
Secondly, in discussing, at least I think with Mr. Prince,
I began--and perhaps it was you, Professor--gave me a feeling
to understand that if there is an open ability to add a protest
in when they learn back, as a result of the announcement,
feedback from the agencies about how decisionmaking took place.
And I felt like that that was one of the more important
aspects that I learned; that it is not just one and done, but
actually there is some period of time where both sides or three
sides that could consider the answer that happened, and if some
extraneous information appeared, it could be considered. And I
thought that that was very important, because an agency may
render a decision about their decision that maybe was or was
not factually understood by both sides.
And so, I found that the process that GAO was following to
be not only fair, but I found it, as has been alluded to here,
a closed group of people or a group of people that were smaller
in size that understood the rules. It was not a surprise. And
they knew what was available to them to fight, to brief, and to
provide feedback on a fair and timely basis.
So, I really have learned a lot from this. I think I can
defend--as the Subcommittee Chairman for Government Operations,
I think I can fairly say that both sides, three sides, whoever
is making the bid, will be dealt with fairly. There is a review
process that would be done by experts who, as we might say from
Ms. Norton, would be accomplished on a fair basis and would be
done in the best interest of not just the taxpayer but a
process that would be well understood.
So, I want to thank each of you for being here. I want to
recognize that each of you have taken your own personal time to
appear before this Subcommittee. You have done so in a
distinguished fashion. And I offer wholehearted support for
you.
We have--Mr. Frost is now here. You know what? I started on
my closing statements. I would like to move back and to
recognize the distinguished gentleman from Florida who was here
earlier and I did not know was here. The gentleman is
recognized for 5 minutes.
Mr. Frost. All good. Thank you so much, Mr. Chair. And
thank you so much to our witnesses for being here.
You know, our witnesses have made the point that the bid
protest process can help make the Federal contracting process
fair and transparent, which is obviously very important.
Unfortunately, there has been a large absence of fairness and
transparency, especially with the current Administration. And I
really want to focus in and to talk about what the absence of
fairness and transparency would mean for the true funders and
true clients of these contracts, which are our constituents and
the American people.
Professor Yukins, are there examples from outside the
United States where businesses lack the ability to challenge
government contracting decisions?
Mr. Yukins. Yes, sir. The most profound example was in
South Africa under Jacob Zuma, when Jacob Zuma and the Gupta
family were able to seize control of actually a small part of
the overall procurement system in South Africa, but they
delegitimized the entire young democracy in South Africa as a
result. A lot of what you see from President Ramaphosa now in
his response--his aggressive response against corruption is
because of what they did, what Jacob Zuma and the Gupta family
did in procurement. So, when a procurement system collapses, it
affects the entire government.
Mr. Frost. What has that meant for the results of those
contracts and the people of those countries' return on the
investment?
Mr. Yukins. What is meant is that it--for South Africa, for
example, is now revamping their procurement system
dramatically.
I think in our own country here, as we are moving forward,
it will be important for there to be, as you say, as much
transparency as possible in order to keep, so--a concrete
example, and something that I know is very important to you, is
the detention centers that are likely to be--that is--the
detention centers have been a classic example of private
capital being used aggressively by the Federal Government to
put facilities in place.
And if those detention facilities are not procured using
transparent processes that set standards as to what the
detention facility should look like based on the contracts,
then there could be very serious ramifications across the
government.
Mr. Frost. Yes. I am really happy you brought this up
because it is something I wanted to talk about.
You know, about a week and a half ago, I did a tour of
this--what I would call an internment camp, but it is an
immigrant detention center in the middle of the Everglades in
the State of Florida, being operated by the Florida Division of
Emergency Management, which is tasked with keeping our people
safe during a hurricane. And they are spending about $450
million of the $500 million cap that they can spend to prepare
for hurricanes on the detention center.
So, hurricane comes up in the Gulf tomorrow, barreling
toward Florida, they have to go back to the legislature and
spend time doing that instead of taking care of the people of
our state, but that is a whole other thing.
I want to talk about the lack of transparency and fairness
we are seeing in this because I do not want to see this
exported across the country. The most recent example is this
Everglades facility. Here are some examples. CDR Health, which
has donated about $4 million to Republicans in Florida over--
and over half a million dollars to Florida Governor Ron
DeSantis a few months ago, won a $17.5 million contract for
this specific facility. IRG Global, which has given $400,000 to
Governor DeSantis and the GOP, including $10,000 to the Florida
GOP just hours before they were awarded a $1.1 million contract
for this immigrant detention center, they are running the camp
operations. And they got another $5 million contract later in a
few weeks after that.
None of these businesses hired to build, staff, and run
this immigrant detention facility have any prior experience
with immigrant detention centers and no prior experience with
anything in corrections facilities or anything around that.
This is costing us eight to ten times what it usually costs
to house a typical inmate. And I would like to enter into the
record, unanimous consent, this article from the Orlando
Sentinel.
Mr. Sessions. Without objection.
Mr. Frost. Yes. It is ``Florida's disaster pipeline funnels
millions to politically connected contractors.''
Look, I mean--and I do not care what party you are in--this
is something we should all--and I do not care what your
politics are. This is something that should worry all of us
when, in the State of Florida, the money set aside to protect
us from hurricanes is being used for a--what I would say is a
politically motivated promise in this mass deportation thing.
But not even just that, but the money that is being awarded
to these contractors is not being done in a transparent way. It
is completely bypassing the typical process you go to, to have
a contractor in the State of Florida. And then it is seemingly
going to people who have donated millions and millions of
dollars to the guy making the decisions.
And so, this is something that should be on the mind of all
people across the country and every Floridian, especially as we
talk about procurement and as we talk about third-party
contractors.
Thank you, and I yield back.
Mr. Sessions. The gentleman yields back his time. Thank you
very much.
So, without objection, all Members have five legislative
days within which to submit material and additional written
questions for the witnesses, which would be forwarded to you.
If there is no further business, without objection, the
Subcommittee stands adjourned.
[Whereupon, at 11:20 a.m., the Subcommittee was adjourned.]