It s Not Just LPTA: Best Practices for the Lowest-Price Technically Acceptable Process

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2 It s Not Just LPTA: Best Practices for the Lowest-Price Technically Acceptable Process Breakout Session # B02 Kenneth Gilliland, Attorney, U.S. Army Armament Research, Development and Engineering Center July 28, :30-3:45 p.m.

3 Introduction What is LPTA? When to use LPTA? Acquisition Approach Solicitation Review Technical Evaluation Cost Price Competitive Range Source Decision Conclusion 2

4 What is LPTA? Why a class on the Lowest Price, Technically Acceptable Basis for Award? Not as complex as the Trade-off Basis for Award Protest grounds perceived to be more limited in LPTA As a consequence, LPTA may not be done IAW FAR 3

5 What is LPTA? Best value is expected to result from selection of the technically acceptable proposal with the lowest evaluated price. FAR (a) Simply, lowest price and technically acceptable wins 4

6 What is LPTA? Evaluation factors and subfactors for acceptability must be stated in solicitation Solicitation must indicate that it is a LPTA basis for award Past performance may be considered - If so, must also be pass/fail basis FAR (b)(1) 5

7 What is LPTA? Tradeoff process: FAR Permits tradeoffs of cost or price and non-cost factors - Government can award to other than the lowest priced - Perceived benefits of the higher-priced proposal shall merit the additional cost 6

8 When to use LPTA? FAR recognizes that the importance of cost may vary Where requirement definable and risk low, cost or price may be more important Less defined requirement and more risk, more technical or past performance may play a role Commercial or non-complex services- LPTA 7

9 When to use LPTA? Examples: Tradeoff Unmanned Aerial Vehicle (UAV) Services to provide analysis of satellite imagery Testing and evaluation of rapidly fielded equipment IT support? 8

10 When to use LPTA? LPTA Battery for Thor III back pack Mortar shell canister Snow removal Landscaping IT support? 9

11 When to use LPTA? Grant Thornton, LLP, B , 2013 CPD 238 (September 25, 2013) - Pre-award protest of 3 BPAs for Financial Audit Svcs. - Protester challenges use of LPTA approach-references (a) and PWS to show high degree of risk - GAO concludes KO acted within discretion 10

12 When to use LPTA? Grant Thornton, LLP, B , 2013 CPD 238 (September 25, 2013) (continued) - GAO recognizes Government in best position as to accommodating its needs - Cites Acquisition Strategy Review Board/Integrated Acquisition review Board minutes and Acquisition Plan - KO determined tradeoff not necessary 11

13 When to use LPTA? Grant Thornton, LLP, B , 2013 CPD 238 (September 25, 2013) (continued) - Customer determined that licensure and certification was sufficient if overarching requirements could be satisfied - Govt. reserved right to use trade-off on task orders 12

14 When to use LPTA? Grant Thornton, LLP, B , 2013 CPD 238 (September 25, 2013) (continued) - Takeaway: Document your rationale! 13

15 Solicitation Review Common error: Inclusion of tradeoff language in LPTA source selection KO needs to review solicitation to ensure LPTA language is consistent 14

16 Solicitation Review LPTA non-price factors must all be acceptable/unacceptable, pass/fail, etc. Any inclusion of just one factor turns source selection into tradeoff 15

17 Solicitation Review Dix Corp., B , 2004 CPD 143 (July 13, 2004) - Post-award protest - Any inclusion of just one weighted factor turns source selection into tradeoff. - Solicitation contained language regarding relatives weights of factors 16

18 Solicitation Review Dix Corp., B , 2004 CPD 143 (July 13, 2004) (continued) - Solicitation also contains the following language: [i]t is the Government s intent to award to the offeror who receives a Satisfactory or better rating in subfactors 1, 2, 3, 4 and who has the lowest price. 17

19 Solicitation Review Dix Corp., B , 2004 CPD 143 (July 13, 2004) (continued) - GAO determined this was a patent ambiguity- clearly obvious mistake - Responsibility of Protestor to inquire regarding conflicting language - Protest ground dismissed as untimely 18

20 Solicitation Review Dix Corp., B , 2004 CPD 143 (July 13, 2004) (continued) - Takeaways: If this was a preaward protest, Government would not have prevailed - Critical to review document documents to ensure language is consistent with the specified approach 19

21 Solicitation Review Award will be made to the Offeror(s) who is deemed responsible in accordance with Federal Acquisition Regulation (FAR), whose proposal conforms to the solicitation requirements, and whose proposal, judged by an overall assessment of the evaluation criteria and other considerations specified in this solicitation, represents the Lowest Priced Technically Acceptable offer. In order for a proposal to be considered awardable, there must be an Acceptable rating in all non-price factors. Trade-offs between price and non-price factor are not permitted. An unbalanced, or incomplete price proposal may be grounds for eliminating a proposal from competition. The Government will evaluate proposed prices for reasonableness using price analysis techniques. Proposed prices evaluated as unreasonable may be grounds for eliminating a proposal from competition. Award will be made on all or none basis. Award shall be made to a single contractor. Offers must include prices for each item listed in order that offers may be properly evaluated. Failure to do so shall be cause for the offeror to be not considered for award. The following factors shall be used to evaluate offers: i. Technical ii. Past Performance iii. Price. Past Performance consists of the last three years from the solicitation issue date. Past performance is approximately equal to price. This requirement is set aside 100% for small business concerns. 20

22 Technical Evaluation in LPTA Source Evaluation teams fail to have a framework for evaluating proposals in an LPTA source selection How do you determine if a factor or subfactor meets acceptable standard? Evaluation teams needs a framework for making their evaluation determinations 21

23 Technical Evaluation in LPTA Source Use of Deficiency, Weakness, and Significant Weakness in evaluation process - Deficiency: A material failure of a proposal to meet a Government requirement or a combination of significant weaknesses in a proposal that increases the risk of unsuccessful contract performance to an unacceptable level (FAR ) 22

24 Technical Evaluation in LPTA Source Use of Deficiency, Weakness, and Significant Weakness in evaluation process - Weakness: Means a flaw in the proposal that increases the risk of unsuccessful contract performance. A significant weakness in the proposal is a flaw that appreciably increases the risk of unsuccessful contract performance (FAR ) 23

25 Technical Evaluation in LPTA Source Sample Technical Evaluation Report: Technical Factor: Offeror X is acceptable and price falls in line with IGE. This is not a good example 24

26 Technical Evaluation in LPTA Source At a minimum, specifically address each significant weakness and deficiency Consider also annotating weaknesses 25

27 Technical Evaluation in LPTA Source Mission Essential Personnel, B , 2013 CPD 22 (January 7, 2013), demonstrates a common error with LPTA source selections -Agency documentation listed three concerns that formed the basis of its No Go rating - Agency argued that only one of the concerns (low personnel fill rate) was a true basis for No Go rating 26

28 Technical Evaluation in LPTA Source Mission Essential Personnel, B , 2013 CPD 22 (January 7, 2013), (continued) - Agency action, as written, looked like this: - Program Manager turnover - Delay of invoice submission - Low fill rate = 1 Deficiency 27

29 Technical Evaluation in LPTA Source Mission Essential Personnel, B , 2013 CPD 22 (January 7, 2013), (continued) - In our view, a fair reading of the contemporaneous evaluation was that it was a combination of the three concerns that resulted in the No Go ratings. 28

30 Technical Evaluation in LPTA Source Mission Essential Personnel, B , 2013 CPD 22 (January 7, 2013), (continued) - Agency SHOULD HAVE done the following: - Program Manager turnover - Delay of invoice submission - Low fill rate = 3 Deficiencies 29

31 Technical Evaluation in LPTA Source Mission Essential Personnel, B , 2013 CPD 22 (January 7, 2013), (continued) - When Agency conducted discussions, it only addressed one of the two concerns - Should have discussed all three concerns as based on the record, all three together formed basis of No Go rating 30

32 Technical Evaluation in LPTA Source Documenting evaluation best practices - Document Weakness, Significant Weakness, and Deficiency with explanation and PWS cite and proposal cite - Do the same for portions of proposal that meet requirement(s) 31

33 Technical Evaluation in LPTA Source Documenting evaluation best practices (continued) - Clearly record and articulate the reason for assigning deficiency, etc. See Halfaker and Assoc., B , 2013 CPD 98 (April 10, 2013) 32

34 Technical Evaluation in LPTA Source Documenting evaluation best practices (continued) - Post hoc explanations that provide a detailed rationale for contemporaneous conclusions and simply fill in previously unrecorded details will generally be considered so long as those explanations are credible and consistent with the contemporaneous record. - Halfaker and Assoc. 33

35 Technical Evaluation in LPTA Source Adjectival Ratings Table Technical Acceptable/Unacceptable Ratings Rating Acceptable Unacceptable Description Proposal Clearly meets the minimum requirements of the solicitation Proposal does not clearly meet the requirements of the solicitation -Department of Defense Source Procedures 34

36 Technical Evaluation in LPTA Source (Past Performance) Adjectival Ratings (continued) Past Performance Evaluation Ratings Table Rating Acceptable Description Based on the offeror s performance record, the Government has a reasonable expectation that the offeror will successfully perform the required effort, or the offeror s performance record is unknown Unacceptable Based on the offeror s performance record, the Government has no reasonable expectation that the offeror will be able to successfully perform the required effort. -Department of Defense Source Procedures 35

37 Evaluating Cost/Price in LPTA Source LPTA concerns known, firm requirements and therefore, price reasonableness should be used In some cases, KO may be required to perform cost analysis 36

38 Evaluating Cost/Price in LPTA Source Impermissible to reject an offer based on unrealistic low price unless - Stated in the solicitation, and - Price Realism analysis performed - See FAR (d)(3) 37

39 Evaluating Cost/Price in LPTA Source Enterprise Information Services, Inc., B , 2013 CPD 145 (June 10, 2013) - Previous protest contained price realism language in solicitation- Agency failed to perform so took corrective action - Amended solicitation to eliminate requirement for price realism 38

40 Evaluating Cost/Price in LPTA Source Enterprise Information Services, Inc., B , 2013 CPD 145 (June 10, 2013) (continued) - Protestor claimed elimination of price realism precluded considering staffing levels 39

41 Evaluating Cost/Price in LPTA Source Enterprise Information Services, Inc., B , 2013 CPD 145 (June 10, 2013) (continued) - Agencies are free to craft non-price evaluation criteria to take into consideration virtually any aspect of the proposals the agency wishes to evaluate, including, for example, technical understanding and risk that arise as a consequence of inadequate staffing. 40

42 Evaluating Cost/Price in LPTA Source Enterprise Information Services, Inc., B , 2013 CPD 145 (June 10, 2013) (continued) -Take-away: for services contracts, look at staffing and labor hours, not actual price, and make a decision based on technical, not on price 41

43 Competitive Range in LPTA Source If discussions are to be conducted, contracting officer shall establish competitive range Competitive range consists of most highly rated proposals or if reduced for purposes of efficiency - FAR (c) 42

44 Competitive Range in LPTA Source In most cases it might not be deemed necessary to conduct discussions in a LPTA procurement- usually not problematic to find one offeror that is acceptable However, there might be situations where necessary, such as when government awarding to multiple offerors 43

45 Competitive Range in LPTA Source Offeror Technical Approach Price Offeror A Acceptable $10,000,000 Offeror B Unacceptable (1 Deficiency) Offeror C Unacceptable (3 Deficiencies) $6,000,000 $5,000,000 44

46 Competitive Range in LPTA Source In most cases it might not be deemed necessary to conduct discussions in a LPTA procurement- usually not problematic to find a reasonable price and acceptable offeror 45

47 Competitive Range in LPTA Source For comp. range purposes, all deficiencies are not necessarily considered equal Permissible to distinguish between a deficiency that is minor in nature and one that would require a complete rewrite 46

48 Competitive Range in LPTA Source See ECC Renewables, LLC; Pacific Power, LLC, B ,B ,B ,B , Dec 18, 2013 SSA distinguished between deficiencies that could be corrected via the submission of supplemental information and deficiencies that would require rewriting of an existing section of an offeror s proposal. 47

49 Source Decision in LPTA Source Source selection decision based on comparative assessment against all selection criteria in the solicitation Decision shall be documented Ensure no trade-offs occur in an LPTA source selection decision 48

50 Conclusion Training of evaluation team - go over the selection criteria and how to evaluate - provide with definitions of weakness, significant weakness, and deficiency - cite to proposal and PWS Document, document, document Proper attitude 49

51 Questions? 50