The Georgia Supreme Court recently ruled that under Georgia procurement laws, vendors who decide to challenge a contract award must file an administrative protest within 10 calendar days or lose their day in court. This decision potentially affects all vendors who do business with the state.
The Diverse Power Opinion
The case arose when the Georgia Department of Technical and Adult Education (DTAE) sought bids from electric suppliers to serve a new training facility to be built near West Point, Georgia. The new facility qualified as a “customer choice” load under the Georgia Territorial Electric Service Act (O.C.G.A. § 46-3-1 et seq.). Diverse Power, Inc., and two other electric utilities submitted bids. The DTAE awarded the contract to one of the other utilities. After Diverse Power obtained records from the DTAE and concluded that it should have been awarded the contract as low bidder, Diverse Power filed suit in superior court.
Despite troubling allegations about how the procurement was handled by the DTAE, the Georgia Supreme Court ruled that aggrieved bidders who submit bids pursuant to the State Purchasing Act (O.C.G.A. § 50-5-50 et seq.) must comply with the 10-day protest filing deadline as described in the Georgia Vendor Manual. Diverse Power, Inc. v. Jackson et al., 285 Ga. 340 (2009). The Vendor Manual, an administrative rulebook created by the Georgia Department of Administrative Services (DOAS), is not subject to legislative oversight. The Court strictly adhered to the 10-day rule notwithstanding Diverse Power’s position that it could not have learned of critical facts regarding the contract award until after expiration of the 10-day period. Because Diverse Power failed to exhaust this administrative remedy, it could not seek judicial relief.
In light of this ruling, vendors doing business with the state of Georgia should consider the following questions:
- Does the 10-day rule apply to the procurement at issue? The State Purchasing Act does not apply to all state procurements, and the vendor must determine whether the Purchasing Act and the Vendor Manual apply. It is important to note that the contracting agency may fail to inform bidders of the applicability of the Purchasing Act or the Vendor Manual during the solicitation process. Also, the Vendor Manual contains a shorter deadline for protests pertaining to facts arising during the solicitation process, including specifications (such protests are due 2 business days prior to public bid closing). Detailed protest procedures are set forth in the Vendor Manual, which is subject to change at any time.
- Does the vendor have the necessary information to file a protest at the time the contract is awarded? DOAS or the contracting agency may fail to provide losing bidders with the necessary information to file a protest, including the agency’s rationale in awarding the contract. It is imperative that losing vendors act immediately to gather all necessary information and file a protest within the 10-day period or risk a forfeiture of rights. In so doing, the vendor should consider whether to exercise its rights under the Georgia Open Records Act.
- Should the losing bidder file a protest even if all relevant facts are not known at the time? Given the Court’s strict adherence to the 10-day deadline, losing bidders should seriously consider filing a protest within the 10-day deadline in order to preserve their rights, even if they have no facts other than the results of the contract award.