A bid protest is a method for a bidder for a government contract to formally challenge the government’s selection process or decision.  Bid-protest procedures vary from jurisdiction to jurisdiction, but there is generally an opportunity to submit a written petition that explains why the protestor believes the government made an unfair or unlawful decision, following by a hearing before an official authorized to decide the dispute (sometimes a judge or equivalent and sometimes an administrator).  In some situations, a bid protest resembles a civil trial and can take weeks or months to resolve, and in other situations it is far less formal and can be resolved rapidly.  The expense of a bid protest often increases with the formality and length of the proceedings.

Earlier this month, the RAND Corporation made public its comprehensive report commissioned by Congress on the federal bid-protest system.  Although the report overall concluded that bid protests were serving their intended function to find and correct errors in the procurement process (approximately 40% of federal protests yielded a change in the outcome), RAND did conclude that the system was too costly for small contracts and small businesses.  RAND recommended an alternative, expedited process for small contracts, as well as changes to make the system easier for small businesses.  Because the federal system requires essentially the same time and expense, regardless of the size of the contract or the resources of the protestor, protests can in some cases be too burdensome on both the governments and the protestor.