Under pressure to cut costs, the federal government has been increasingly relying on Low Price, Technically Acceptable (LPTA) evaluation criteria for procurements, and contractors are now becoming more aggressive in pushing back.

“The No. 1 issue is misuse of LPTA evaluation factors for high-end professional services, and that has been increasing in the last year or so,” Alan Chvotkin, executive vice president for the Professional Services Council trade organization, told Set-Aside Alert.

LPTA use has been around for decades, and has been on the rise for several years. It means a contracting official must choose the lowest-priced offering from among those deemed technically acceptable. It is viewed as an alternative to “best value,” in which a contracting official may select a higher-priced bid, which may be justified by superior technical capabilities, better past performance or a better management approach.

On Sept. 26, the services council wrote to Frank Kendall, undersecretary of defense for acquisition, recommending additional guidance on LPTA in the department’s upcoming “Better Buying Power 2.0” initiative.

“Our members’ greatest concern is the government’s overwhelming tendency to use LPTA acquisition strategies for complex solutions,” Stan Soloway, president of the council, wrote in the letter.

While LPTA’s are OK for commodities, they are being applied almost routinely to services contracts for which best-value would be more appropriate, he indicated.

“LPTA source selection strategies have essentially become the default source selection approach, almost regardless of the nature of the requirements involved. There is also broad agreement that when the technical requirements—including existing capabilities, past performance, and ongoing technology refresh—are evaluated at only minimal levels for complex requirements, the acquisition outcome is rarely beneficial to either the government or industry,” he wrote.

Soloway alleged there are misapplications of LPTA, such as in DOD’s recent awards for audit readiness and preparation services, which he said involved specialized and sophisticated accounting.

The council also claimed examples where the scope of work is ambiguous, confusing bidders and possibly requiring later clarification, which may raise costs.

LPTA procedures also are being inappropriately executed, Soloway wrote. For example, some agencies are not even opening the technical proposals of offerors who are not the lowest bidders, he wrote.

“As a result, the government is prevented from learning about technical solutions that may better suit the mission requirements, even though the cost may be minimally higher,” Soloway wrote.

The council recommended that Better Buying Power 2.0 include guidance to the field making it clear that LPTA is only appropriate when acquiring simple, commoditized services. If that is the case, the department must open and evaluate all technical proposals before reviewing price proposals, the council said. For more complex services, the council advised cost-technical trade-off strategies.

Meanwhile, the Office of Federal Procurement Policy seems to be taking a hands-off approach on the LPTA vs. “best value” debate. OFPP Administrator Joe Jordan said at a recent breakfast event that industry likes best-value, while government is pushing low price, and both arguments have merit.

“We need to do some more analysis, (and have) some more conversations with industry and agencies, especially DOD, to figure out exactly where equilibrium lies,” Jordan said, according to Federal Computer Week.

Mike Lisagor, Centurion Research Solutions LLC government business growth advisor, said LPTA was tried in the 1980s and eventually discarded, but now has resurfaced in strength.

“Naïve me, I thought we buried this practice,” Lisagor wrote in a blog entry.

“Would you interview and then hire the job candidate who just barely meets your minimum requirements? Well, that is what you’re doing when you establish LPTA evaluation criteria,” Lisagor wrote.

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