The Government Accountability Office (“GAO”) has released its Annual Report to Congress summarizing bid protest activity for Fiscal Year 2023 (GAO-24-900538). Although there is a seemingly drastic increase in the number of protests sustained, the real trend worth noting is an uptick in protests filed at GAO—reversing a recent trend that had seen GAO protest numbers falling.

With the full context in hand, the FY 2023 GAO protest data mostly show a steady continuation of recent trends: the number of sustains and sustain rate remains largely the same as FY 2022, “effectiveness” remains high and stable (57 percent), and the hearing rate remains low at two percent (22 for the year). The meaningful increase in cases filed at GAO shows that protesters still view GAO as a valuable protest forum, even as an increasing number of protesters opt for the more fulsome document production and (at times) less deferential analysis they expect at the U.S. Court of Federal Claims.

Below we explain key takeaways for contractors from this latest report.

Dramatic Increase in the Sustain Rate Connected to a Single Procurement

The number that jumps out from GAO’s latest report is a huge increase in the number of protests sustained and percentage of protests sustained—from 59 sustained protests (FY 2022) to 188 (FY 2023) and from 13 percent sustained (FY 2022) to 31 percent (FY 2023). These numbers, however, are skewed by a single procurement that resulted in a pair of decisions that account for 119 of the 188 total sustains for the fiscal year. See Systems Plus, Inc. et al., B-419956.184 et al., June 29, 2023, 2023 CPD ¶ 163 (sustaining 93 protests); Phoenix Data Security, Inc. et al., B‑419956.200 et al., July 10, 2023, 2023 CPD ¶ 172 (sustaining 26 protests filed by pro se protesters). This was a Department of Health and Human Services procurement for information technology services under the Chief Information Officer-Solutions and Partners 4 (referred to as “CIO-SP4”) government-wide acquisition contract.

If one were to treat Systems Plus and Phoenix Data Security as two protests rather than 119, the total number of sustains drops from 188 to 69, with a sustain rate of 14 percent—in line with GAO’s typical numbers. If one views the CIO-SP4 procurement as an outlier, this indicates that GAO’s sustain trend has not meaningfully changed.

Filing Numbers Are Up

As noted, the total number of protests filed at GAO increased this year after a recent multi-year trend of decreasing protest numbers. (Filings include protests, cost claims, and requests for reconsideration.) A single filing is an individually docketed protest case number, so total filings include all conglomerated protests in the Systems Plus and Phoenix Data Security decisions. Yet, the increase trend holds true even when reducing the 119 protests filed in the Systems Plus and Phoenix Data Security decisions down to two. The chart below shows the number of protest actions reported by GAO since FY 2019.

The increase in filings for FY 2023 is notable because it shows that protesters continue to feel confident in filing their protests with GAO. This counters, somewhat, the view by some that protesters have begun shifting to the Court of Federal Claims as a preferred first option for protests, in part because the Court will allow protesters access to the entire procurement record by default (in contrast to GAO, which permits agencies to withhold records deemed irrelevant).

The Hearing Rate and Task Order Protests Continue to Be Low

Hearings and task order protests continue to comprise only a small portion of GAO bid protest activity. Although the number of hearings for cases decided on the merits rose by 20 in FY 2023 (there were only two in FY 2022), they still accounted for just 2 percent of FY 2023 cases. These numbers are in line with the pre-pandemic hearing numbers from FY 2019.

The GAO report notes that of the 2,041 cases closed in FY 2023, just 368 are for task or delivery orders placed under indefinite-delivery / indefinite-quantity contracts. This mostly just reflects GAO’s jurisdictional limits for protesting these types of procurements and perhaps that agencies are adept at using task orders in a manner that does not open awards to a protest.

Effectiveness Rate Is Stable and Again Tops 50 Percent

The overall effectiveness rate remains stable and is the highest across the previous five fiscal years at 57 percent. The chart below shows these statistics in recent years. “Effectiveness” means an outcome where a protest obtained some form of desired relief—whether through a sustain decision or agency voluntary corrective action. GAO’s report notes that the corrective action rate remains “significant.”

The Systems Plus and Phoenix Data Security dynamic has juiced these numbers as well—but less dramatically than with the sustain percentage that is counting only the small subset of cases that result in a written decision.

The bottom line is that GAO protests remain an effective tool in a contractor’s arsenal for combatting procurement errors.