Page 1 GAO-16-502R Canceled DOD Solicitations

441 G St. N.W.

Washington, DC 20548

June 29, 2016 

Congressional Addressees

Defense Contracting: Complete Historical Data Not Available on Canceled DOD 

Solicitations

The Federal Acquisition Regulation (FAR) generally requires that federal executive agencies 

seek competition for contracting opportunities by issuing solicitations. In certain instances, after 

notifying industry of its intent to purchase a certain good or service, the government may decide 

to cancel a solicitation—thereby stopping the procurement process. The House report 

accompanying the National Defense Authorization Act for Fiscal Year 2016 included a provision 

for us to report on solicitations that the Department of Defense (DOD) canceled after receiving 

bids or proposals from industry between fiscal years 2010 and 2014.1 This report describes: 1) 

standards for canceling a solicitation, 2) availability of data on canceled DOD solicitations, and 

3) the process available for reviewing complaints involving canceled DOD solicitations and 

examples of decisions involving those complaints.

To describe the standards to cancel a solicitation, we reviewed the FAR and GAO bid protest 

decisions. To determine what information is available on canceled DOD solicitations, we 

reviewed government data systems and interviewed officials from the office of the Under 

Secretary of Defense for Acquisition, Technology and Logistics. To identify examples of bid 

protest decisions involving canceled solicitations, we reviewed selected bid protest decisions

issued in calendar years 2013 through 2015, and judgmentally selected a nongeneralizable 

sample of examples to illustrate a range of scenarios, including different contracting procedures.

We conducted this performance audit from February 2016 to June 2016 in accordance with 

generally accepted government auditing standards. Those standards require that we plan and 

perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions based on our audit objectives.

Standards for Canceled Solicitations Vary Depending on Contracting Procedure Used

The FAR lays out two primary procedures—sealed bidding and negotiated procurements—for 

soliciting responses from industry and awarding contracts. The contracting procedure used 

depends on different factors, including the risk of unsuccessful contract performance and the 

extent to which contract requirements are clearly defined. 2 Under sealed bidding procedures, 

 1

H.R. Rep. No. 114-102 (2015). In addition, the Chairman, House Small Business Subcommittee on Contracting and 

the Workforce, signed on in 2016 as a co-requester for this report.

2

FAR § 6.401(a)(b).Contracting officers must solicit sealed bids when (1) time permits the solicitation, submission, 

and evaluation of sealed bids; (2) the award will be made on the basis of price and other price-related factors; (3) it is 

not necessary to conduct discussions with the responding offerors about their bids; and (4) there is a reasonable 

expectation of receiving more than one sealed bid. If these four criteria are not met, contracting officers must use 

negotiated procurement procedures. 
Page 2 GAO-16-502R Canceled DOD Solicitations

solicitations for bids must describe requirements that are clear and complete, and will allow the 

government to make an award based primarily on price-related factors. On the other hand, 

negotiated procurements may be for requirements that are less clearly defined and, for that 

reason, an exchange of information may be needed to improve understanding of the 

government’s requirements and industry capabilities.

The standards that apply to an agency’s decision to cancel a solicitation vary depending on the 

type of contracting procedure used. The FAR sets general standards that the government must 

meet before canceling a solicitation using sealed bid procedures. Specifically, before bids are 

opened, an agency may cancel a solicitation when it is clearly in the public interest to do so. The 

FAR has set a higher standard for canceling solicitations after bid opening because bid prices 

have been exposed. An agency must award a contract after bid opening, unless a compelling 

reason exists to cancel the solicitation. While the FAR does not explicitly lay out the standard for 

canceling solicitations for negotiated procurements, GAO bid protest decisions note that the 

government has broad authority to cancel solicitations for negotiated procurements and needs

only a reasonable basis to do so.3 The different standards agencies must meet when canceling 

a solicitation and examples of different scenarios that meet these standards for sealed bids and 

negotiated procurements are shown in figure 1.

4

Figure 1: Examples of Scenarios to Cancel a Solicitation for Sealed Bids and Negotiated Procurements

 3

The reasonable basis standard also applies to requests for quotations which are used to solicit information under 

simplified acquisition procedures and for federal supply schedule ordering that requires a statement of work.

4

Bidders or other interested parties may file a challenge to the terms of a solicitation or the award of a government 

contract. GAO’s Procurement Law Division adjudicates bid protests filed at GAO.
Page 3 GAO-16-502R Canceled DOD Solicitations

Further, the FAR provides a clause that must be included in some solicitations to caution 

potential competitors that the award is contingent on available funding and a contract may not 

be awarded.5

Complete Historical Data Are Not Available on Canceled DOD Solicitations

Complete historical data are not available to assess patterns in DOD’s cancelation of 

solicitations. According to DOD officials, DOD does not track information on canceled 

solicitations and other available government data sources do not contain complete and reliable 

historical information on canceled solicitations. We reviewed the Federal Procurement Data 

System-Next Generation and determined that no information was available on canceled

solicitations as only awarded contract actions are recorded in the system. We determined that 

the federal business opportunities (FBO) web page (www.fedbizopps.gov), which is managed 

by the General Services Administration (GSA), was the best potential source for information on 

canceled solicitations. FBO is the primary government point of entry for soliciting responses 

from industry, and solicitations must be made available on FBO.6 While the FAR does not 

require contracting officials to publicize notices of canceled solicitations, officials may post 

cancelations on FBO.7 We took a number of steps to extract data from FBO for analysis; 

however, we found that the information from FBO is not available in a format that would allow 

for a reliable trend analysis of DOD’s canceled solicitations. We assessed the following options 

to analyze FBO data: 

1. The online search features at FBO.gov will yield all solicitations posted on the site 

during any date range including fiscal years 2010 through 2014; however, the data are 

not exportable. A search of FBO data for fiscal year 2014 yielded over 200,000 

government-wide postings. A manual review of each solicitation would be required to 

determine the number that are for DOD and the number that were canceled. 

2. GSA also makes weekly and nightly files publicly available of all posted activity on FBO 

in an exportable format that could potentially be used to systematically analyze the 

data. However, the weekly files are overwritten each week and not archived; therefore, 

historical information is not available from these files. Upon review of the nightly files, 

we found that they are missing a number of solicitations that appear on FBO each day. 

Further, the nightly file does not include all of the information needed to assess 

canceled solicitations, such as the notice type which would identify whether the post 

was announcing an award or canceling a solicitation. 

3. FBO has an additional search tool, called FBOpen, that is meant to make it easier for 

small businesses to search for FBO opportunities. FBOpen includes a dataset of past 

opportunities posted to FBO.gov. However, this dataset is sourced from the nightly 

FBO download, and therefore we could not verify that it included all solicitations posted 

to FBO. Further, GSA began building this dataset on FBO in 2014 and therefore it 

includes only limited data prior to 2014. For the fiscal year 2014 data that are available 

through FBOpen we were unable to determine the outcome of the vast majority of the 

 5

FAR § 52.232-18.

6

Contracting officers must generally transmit a notice to the government-wide point of entry—the FBO webpage—for 

proposed contract actions, including out-of-scope modifications to existing contracts, expected to exceed $25,000, 

and for contract actions in any amount if deemed advantageous to the federal government. 

7

FAR § 5.207(f). 
Page 4 GAO-16-502R Canceled DOD Solicitations

solicitations. Specifically, we identified more than 78,000 unique DOD solicitations for 

fiscal year 2014.While we were able to determine that a small number—approximately 

1,500—were canceled, we were unable to determine the outcome for 76 percent of the 

solicitations. 

Given these limitations, we determined that data available from FBO were not sufficiently 

reliable and complete for the purposes of analyzing historical trends in canceled DOD 

solicitations. FBO is intended to make industry aware of the government’s contracting 

requirements, not to archive and track the type of information on past solicitations which would 

be needed to identify canceled solicitations from fiscal years 2010 through 2014. 

GAO Bid Protest Process Is Available for Review of Canceled Solicitations

If a contractor believes that a solicitation has been canceled without meeting the standards to 

do so, it may file a formal bid protest with GAO’s Procurement Law Division, which will 

determine if the solicitation was canceled without proper cause. Each of these cases must be 

determined on its own merits and circumstances, as outlined in the examples of DOD cases 

below:

• In 2015, a contractor filed a protest arguing that the Army improperly canceled a 

solicitation for pest management services. After comparing the proposed prices of all 

offers to the government estimate and current contract pricing, the Army determined that 

each proposal offered an unreasonable price and canceled the solicitation. As a result, 

one of the offerors filed a protest arguing, among other things, that the Army’s price 

evaluation was unreasonable and therefore the Army improperly canceled the 

solicitation. GAO found that the cancelation was reasonable, noting that a reasonable 

basis for cancelation exists when the government cannot purchase at a fair and 

reasonable price.8

 

• In 2012, the U.S. Army Corps of Engineers (USACE) issued a solicitation for dredging 

services. After bids were opened, the USACE canceled the solicitation when it 

determined that some requirements were ambiguous and could result in overpayment by 

the government. A contractor protested the cancelation claiming that the solicitation was 

not ambiguous; therefore, the USACE did not have a compelling reason to cancel the 

solicitation after bid opening. GAO concluded that the solicitation requirements were 

ambiguous; therefore, USACE had a compelling reason to cancel the solicitation.9

 

• In 2014, a contractor filed a protest, challenging the Defense Logistic Agency’s (DLA) 

cancelation of a solicitation for helicopter refueling system parts. DLA determined that 

the solicitation should be canceled and revised because it did not accurately reflect the 

agency’s needs and failed to take into account the shelf-life of the parts. GAO found that 

there was no basis to object to DLA’s decision to cancel and revise the solicitation, 

explaining that a reasonable basis for cancelation exists when a solicitation does not 

accurately reflect an agency’s requirements.

10

 8

Precise Management, LLC, B-411708, Oct. 5, 2015.

9

Great Lakes Dredge & Dock Company, LLC, B-407502.2, Feb. 13, 2013.

10WKF Friedman Enterprises, B-409892.2, Sept. 25, 2014.
Page 5 GAO-16-502R Canceled DOD Solicitations

We are not making any recommendations in this report. To the extent that issues regarding 

canceled solicitations may arise in individual procurements, the bid protest process provides 

contractors with a mechanism to contest circumstances of canceled solicitations on a case-bycase basis. 

Agency Comments

We provided a draft report to DOD for comment. In written comments, which are reprinted in the 

enclosure, DOD appreciated our recognition of the role of the bid protest process. 

-------

We are sending copies of this report to the appropriate congressional committees, the Secretary 

of Defense and other interested parties. In addition, the report is available at no charge on the 

GAO website at http://www.gao.gov.

If you or your staff have any questions about this report, please contact me at (202) 512-4841 or 

woodsw@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs 

may be found on the last page of this report. GAO staff who made key contributions to this 

report include Tatiana Winger, Assistant Director; Brandon Booth; Jenny Chanley; Kurt Gurka;

Stephanie Gustafson; Matthew Lowney; Beth Reed Fritts; and Roxanna T. Sun. 

William T. Woods

Director, Acquisition and Sourcing Management

Enclosure
Page 6 GAO-16-502R Canceled DOD Solicitations

List of Addressees

The Honorable John McCain 

Chairman

The Honorable Jack Reed

Ranking Member

Committee on Armed Services

United States Senate

The Honorable Thad Cochran

Chairman

The Honorable Richard J. Durbin

Ranking Member

Subcommittee on Defense

Committee on Appropriations

United States Senate

The Honorable Mac Thornberry

Chairman

The Honorable Adam Smith

Ranking Member

Committee on Armed Services

House of Representatives

The Honorable Rodney Frelinghuysen

Chairman

The Honorable Peter Visclosky

Ranking Member

Subcommittee on Defense

Committee on Appropriations

House of Representatives

The Honorable Richard Hanna

Chairman

Subcommittee on Contracting and Workforce

Committee on Small Business

House of Representatives
Page 7 GAO-16-502R Canceled DOD Solicitations

Enclosure: Comments from the Department of Defense

(100669)
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