On April 15, GAO proposed a rule in the Federal Register that would impose a $350 fee to file a protest. While $350 will not break the bank for most contractors, the new fee may be a slippery slope. Why not $500 or $1,000 or $2,000? GAO’s decisions in bid protests improve the procurement process. Do we want to miss out on the opportunity for such improvements because a small businessman or woman decides not to pursue a protest because he or she does not want to pay a fee to exercise what they believe is the right to be treated fairly in a procurement? And, depending on how the final rule comes out, it may create other problems for protesters. Can failure to pay the fee on filing be remedied later? Can the fee be waived? Will protesters be given the opportunity to file protests by hand delivery or by mail? We will see.
GAO’s reasoning behind the proposed rule stems from a 2014 statute called the Consolidated Appropriations Act. Public Law 113-76, 128 Stat. 5 (Jan. 14, 2014). Specifically, section 1501 “directs GAO to establish and operate an electronic filing and document dissemination system, ‘under which…(A) a person filing a protest under this subchapter may file the protest through electronic means; and (B) all documents and information required with respect to the protest may be disseminated and made available to the parties to the protest through electronic means.’” Emphasis added.
GAO is currently developing this new system, which will be called the Electronic Protest Docketing System (EPDS). We all like new. But this new electronic filing system comes with a price tag as the Consolidated Appropriations Act also authorizes GAO to “require each person who files a protest under this subchapter to pay a fee to support the establishment and operation of the electronic system…” The rule states that the anticipated $350 filing fee was calculated using actual costs GAO has incurred to develop the system as well as estimated costs of maintaining the system.
On the bright side, even though GAO is not required by law to seek comments before issuing a final rule (because it is not subject to the Administrative Procedure Act), GAO has invited written comments regarding the proposed rule. If enough comments are filed expressing concerns about the fee, GAO is “open to consider lowering it.” Comments are due before May 16.