| Bidding for construction contracts is the primary method by which contractors submit competing offers to provide services or supplies on a public construction project. The rules and regulations adopted by governmental entities for the procurement of their contracts must be followed by all participants in the bidding process. When a contractor believes that the requisite rules or regulations have been abrogated by a fellow contractor, he will likely file a bid protest against any award of the contract to the fellow contractor.
Bid protests can occur at all levels of government, but are predominantly associated with bidding at the federal level. In this arena, protests are filed either with the Comptroller General of the Government Accountability Office (GAO), the governmental agency involved, or in a federal court.
Any "interested party" may file a bid protest with the GAO. However, certain time limitations apply and untimely protests may be dismissed outright. Should the GAO determine that an impropriety exists, it will issue a remedial recommendation that may include instructions that the federal contracting agency abstain from exercising options under the contract, terminate the contract, recompete the contract, issue a new call for bids, or award the contract consistent with the rules and regulations. Additionally, the GAO may issue any other instructions it determines will promote compliance with the rules and regulations.
Bid protests can be filed with the federal contracting agency by a bidder whose economic interest would be affected by the award of, or failure to award, the contract. The protest can be made either pre- or post-award of the contract. If the head of the contracting agency determines that an irregularity exists in the solicitation, proposed award, or award, he may, among other things, take any action that could have been recommended by the Comptroller General of the GAO.
Contractors may also seek relief for their bid protests through the federal courts. Oftentimes, the resort to judicial action stems from a desire to obtain injunctive relief while the GAO or federal contracting agency is reviewing the bid protest. Injunctive relief is necessary to halt the award process so that the merits of the protest can be addressed. As far as damages, the most that will probably be received is the cost of the bid preparation. For contract disputes prior to award, the proper court is the United States Court of Federal Claims. Post-award disputes are properly brought in the applicable federal district court.
Bid protests involving state or local government contracts should follow the procedures outlined by such entities. Likely, the administrative procedures will somewhat mimic those followed for federal bid protests. Whether judicial action is sanctioned for bid protests will turn on the state involved. Copyright 2010 LexisNexis, a division of Reed Elsevier Inc. |