Use of the Lowest Price Technically Acceptable Process

The U.S. Government Accountability Office (GAO) published a report last month examining the use of the Lowest Price Technically Acceptable process (LPTA) in federal contracting. Federal Acquisition Regulation (FAR) part 15 includes the LPTA in negotiated conversations associated with the best value variety. Federal agencies may elect to use the LPTA process where the requirement is clearly defined, and the risk of unsuccessful contract performance is minimal. Awards are then made based on the lowest priced available.

The report explained the status of regulatory changes governing the use of Lowest Price Technically Acceptable process of authorizing government contracts. The report compares the different LPTA’s utilization by both the DoD and civilian agencies to competitively award contracts and orders valued over $5 million in fiscal year 2018 because sections 813 and 880 of the National Defense Authorization Act requires reporting. The GAO report found that the DOD used the LPTA process more frequently than other selected civilian agencies.

The report indicated that that DOD used the LPTA process to buy equipment, fuel, information technology services, and construction services, among other things. However, contracting officials were perplexed by life cycle cost assessments associated with the procurements, and struggled to determine whether the products and services they were acquiring would be considered replaceable in nature.

After conducting interviews with DOD officials from the office of Federal Procurement Policy and civilian agencies, it was determined by the Government Accountability Office that both entities do not maintain centralized data on whether the LPTA process is used to award contracts. Although restricted by a 30-day rule change notice,

DOD officials claimed that the Lowest Price Technically Acceptable Process selecting contracts were less complex and resembled the selection criteria inherent to their acquisition framework. they’ve utilized in the past. DOD’s March 2016 Source Selection Procedures included five of the eight criteria for using the LPTA process. Civilian representatives believe the LPTA will slow down and complicate their acquisition process that because their acquisitions aren’t as costly as DOD acquisitions. Agencies like the HHS claim their acquisitions process is already complex and the LPTA was inappropriate without revisions and have decided to wait for regulations to be finalized before determining if new agency-specific processes should be implemented. 

In December 2018, DOD issued a proposed Defense Federal Acquisition Regulation Supplement rule for public comment to implement the FY 2017 NDAA provisions for using the LPTA process, and providing further clarification that these provisions were applicable to both contracts and orders.

Despite its benefits, both entities would like to see reform to the Defense Federal Acquisition Regulation Supplement (DFARS) and the Federal Acquisition Regulation (FAR), clarifying the terms in hopes of making a unilateral LPTA process. Civilian agencies went further, advocating that the LPTA process be avoided entirely. Facing the need to address LPTA-related provisions in two separate NDAAs and the need to resolve a backlog of DFARS changes, Defense Pricing and Contracting officials stated that DOD expects to finalize the rule by the end of fiscal year 2019.

Topics: Acquisition, Procurement