Lowest Price Technically Acceptable (LPTA)

Section 813 of the 2017 National Defense Authorization Act (NDAA) (Public Law 114-328) required a change to the Defense Federal Acquisition Regulation Supplement to state that LPTA source selection criteria be used only in situations in which six factors are fulfilled.  Subsequently, this was modified by Section 822 of the 2018 NDAA adding two additional factors.  DFARS 215.101-2-70, the lowest price technically acceptable source selection process shall only be used when:

1. Minimum requirements can be described clearly and comprehensively and expressed in terms of performance objectives, measures, and standards that will be used to determine the acceptability of offers;
2. No, or minimal, value will be realized from a proposal that exceeds the minimum technical or performance requirements;
3. The proposed technical approaches will require no, or minimal, subjective judgment by the source selection authority as to the desirability of one offeror’s proposal versus a competing proposal;
4. The source selection authority has a high degree of confidence that reviewing the technical proposals of all offerors would not result in the identification of characteristics that could provide value or benefit;
5. No, or minimal, additional innovation or future technological advantage will be realized by using a different source selection process;
6. Goods to be procured are predominantly expendable in nature, are nontechnical, or have a short life expectancy or short shelf life (See PGI 215.101-2-70(a)(1)(vi) for assistance with evaluating whether a requirement satisfies this limitation);
7. The contract file contains a determination that the lowest price reflects full life-cycle costs (as defined at FAR 7.101) of the product(s) or service(s) being acquired (see PGI 215.101-2-70(a)(1)(vii) for information on obtaining this determination); and
8. The contracting officer documents the contract file describing the circumstances justifying the use of the lowest price technically acceptable source selection process.

Additionally, to the maximum extent practicable, the use of LPTA source selection criteria shall be avoided in the case of a procurement that is predominately for the acquisition of—

1. Information technology services, cybersecurity services, systems engineering and technical assistance services, advanced electronic testing, or other knowledge-based professional services;
2. Items designated by the requiring activity as personal protective equipment (except see paragraph (b)(1) of DFARS 215.101.2-70); or
3. Services designated by the requiring activity as knowledge-based training or logistics services in contingency operations or other operations outside the United States, including in Afghanistan or Iraq.

Section 832 of the 2018 NDAA added the prohibition on use of LPTA source selection process to acquire engineering and manufacturing development for a major defense acquisition program (MDAP). Applies to MDAPs for which budgetary authority is requested for fiscal year 2019 or a subsequent fiscal year. 

Prohibitions.

1. In accordance with section 814 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328) as amended by section 882 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91), contracting officers shall not use the lowest price technically acceptable source selection process to procure items designated by the requiring activity as personal protective equipment or an aviation critical safety item, when the requiring activity advises the contracting officer that the level of quality or failure of the equipment or item could result in combat casualties. See 252.209-7010 for the definition and identification of critical safety items.
2. In accordance with section 832 of the National Defense Authorization Act for Fiscal Year 2018 (see 10 U.S.C. 4232), contracting officers shall not use the lowest price technically acceptable source selection process to acquire engineering and manufacturing development for a major defense acquisition program for which budgetary authority is requested beginning in fiscal year 2019.
3. Contracting officers shall make award decisions based on best value factors and criteria, as determined by the resource sponsor (in accordance with agency procedures), for an auditing contract. The use of the lowest price technically acceptable source selection process is prohibited (10 U.S.C. 240f).

LPTA is appropriate where: requirements are well defined; risk of unsuccessful contract performance is minimal; and there is no value, need, or willingness to pay for higher performance or quality. Under LPTA all factors other than cost or price are evaluated on an “acceptable” or “unacceptable” basis. Best value is expected to result from selection of the technically acceptable proposal with the lowest evaluated price.

Tradeoff Process. The tradeoff source selection process is the other technique used [See FAR 15.101-1]. At the discretion of the Government, award may be based on tradeoffs among cost or price, and non-cost factors that allow the Government to accept other than the lowest priced proposal, or the highest technically rated offer. LPTA is NOT a tradeoff process.

Should you use LPTA or a Tradeoff Process?

Prior to determining the type of source selection appropriate for an acquisition, the Program Manager (PM) or Requirements Owner (RO), as applicable, in consultation with the contracting officer, must consider all aspects of the requirement. The team must ensure the aspects of a potential solution that will influence the Government’s source selection are reflected in evaluation criteria in clear, concise, assessable terms. When developing source selection criteria, consider hybrid approaches, applying subjective and objective criteria as appropriate to evaluate elements of the proposal. Unless otherwise specifically required, these procedures may be tailored as appropriate to the particular procurement/acquisition to maximize competition and the efficiency and effectiveness of the competitive process, while ensuring the award can successfully withstand scrutiny. This will help avoid unnecessarily protracted source selections and provide the clearest method of determining which proposal is the most advantageous to the Government.

Market research information is instrumental and should be used to shape the acquisition strategy; to determine the type and content of the product description, performance work statement, or statement of work; and to develop the support strategy, the terms and conditions included in the contract, and the evaluation factors used for source selection. Ask other Agencies that used LPTA how that worked for similar acquisitions and what were the evaluation factors used for source selection.

The Table reproduced from Table 1 of the DoD SSP (below) illustrates how factors may drive the appropriate type of source selection and evaluation criteria selected. Care should be taken in determining the number of factors and subfactors to avoid adding unnecessary complexity and confusion to the source selection. Criteria should be tailored to balance objectivity and subjectivity in the evaluation with outcome(s) and to emphasize areas of differentiation, particularly in source selections that utilize best value trade-offs.

Best Value Continuum Considerations:

LPTA may be used in situations where the Government would not place any value on a product or service exceeding the Government’s threshold technical or performance requirements and these requirements can be objectively defined in measurable terms. Such situations include acquisitions of commercial or non-complex services or supplies which are clearly and objectively defined. When LPTA is used, the solicitation and the Source Selection Plan must clearly describe the minimum requirements that will be used to determine the acceptability of the proposal. LPTA should not be used when the SSA will be required to make a judgment as to the desirability of one offeror’s proposal versus a competing proposal. Well-defined standards of performance and quality of services must be available to support the use of LPTA. When standards of performance and quality are subjective, or the Government places value on higher quality or performance, another approach should be used. The LPTA process does not permit tradeoffs among price and non-price factors (see FAR 15.101-2).

Subjective Tradeoff is a source selection process used when it may be in the best interest of the Government to consider award to other than the lowest priced offeror or other than the highest technically rated offeror but it is not possible to place a quantifiable value on proposed performance or capabilities above threshold (minimum) requirements

Value Adjusted Total Evaluated Price (VATEP) is a technique which can be used in a tradeoff source selection where the offeror’s total proposed price may be adjusted based on the “value” placed on better performance. The adjustment method must be clearly identified in the solicitation. The SSA then determines if a higher rated technical offer is “worth” the additional cost to the Government.