Both the administrations of Barack Obama and Joe Biden used no-bid (also called "sole-source" or "noncompetitive") contracts, as have virtually all modern presidents. The federal government allows such contracts under specific circumstances, although competitive bidding is generally preferred.
Common justifications include:
Urgency or emergency situations
During wars, natural disasters, or public health emergencies, agencies may argue that competition would take too long.
Examples include military operations, hurricane relief, and during the Biden administration, aspects of the response to the COVID-19 pandemic.
Only one qualified source
An agency may determine that only one company possesses the necessary expertise, proprietary technology, or existing infrastructure.
This often occurs in defense, information technology, or specialized scientific work.
National security
Defense and intelligence agencies sometimes award sole-source contracts because open competition could reveal sensitive information.
Continuation of existing work
If a contractor is already performing highly specialized work, agencies may argue that changing contractors would be inefficient, costly, or disruptive.
Under Obama, federal agencies continued longstanding practices of using sole-source contracts, particularly in defense and national security. Obama also issued policies encouraging greater transparency and reducing unnecessary noncompetitive contracting after criticism of contracting practices during the Iraq War.
Under Biden, sole-source contracting increased in some areas during the COVID emergency and for rapid implementation of major infrastructure and technology programs, though the administration has also emphasized competition and antitrust enforcement.
The percentage of federal contract dollars awarded without full and open competition varies by year and by how it is measured, but government audits have repeatedly found that noncompetitive awards account for a substantial minority—not a majority—of federal contracting. Oversight is provided by agency inspectors general, the Government Accountability Office, and Congress.
Critics argue that no-bid contracts can lead to favoritism, waste, or higher costs. Supporters contend that they are sometimes necessary to respond quickly to emergencies or obtain highly specialized services.