DOD Implements New Lowest Price, Technically Acceptable Source Selection Guidance

Published: October 02, 2019

Federal Market AnalysisAcquisition ReformDEFENSENational Defense Authorization ActPolicy and Legislation

Services procurements finally get the official protection from LPTA that they’ve needed.

For several years now industry has expressed reservations about the Department of Defense’s use of lowest price, technically acceptable (LPTA) criteria for source selection procedures, citing the misuse of LPTA to make awards for complex, services-oriented contracts. Congress heard these complaints and in 7 separate sections of the National Defense Authorization Acts for fiscal years 2017 and 2018 it instituted rules limiting the use of LPTA. The DOD began the process of implementing these rules by announcing them for public comment in the Federal Register back in December 2018. Now the DOD has published final guidance for LPTA use and the feedback it received during the public commentary phase of rule evaluation.

Here are the final changes to Defense acquisition rules as recorded in the Federal Register. DOD mandates that the LPTA selection process shall only be used:

  1. When 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. When no, or minimal, value will be realized from a proposal that exceeds the minimum technical or performance requirements.
  3. When the proposed technical approaches 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. When 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. When no, or minimal, additional innovation or future technological advantage will be realized by using a different source selection process.
  6. When goods to be procured are predominantly expendable in nature, are non-technical, or have a short life expectancy or short shelf life.
  7. When the contract file contains a determination that the lowest price reflects full life-cycle costs of the product(s) or service(s) being acquired.
  8. When the contracting officer documents the contract file describing the circumstances justifying the use of the lowest price technically acceptable source selection process.

In addition, contracting officers “shall avoid, to the maximum extent practicable,” using LPTA processes 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.
  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.
  4. Items designated as personal protective equipment or critical to aviation safety.
  5. Engineering and manufacturing development services for a major defense acquisition program.
  6. Auditing services.

Implementation of this new guidance should set the minds of services contractors at ease, particularly those providing technology solutions to federal agencies. And should a contracting official still insist on using LPTA selection procedures for an IT solution (you know someone will) industry will now have recourse to protest awards based on the new LPTA rules.