Lawmakers Aim to Restrict Use of Lowest-Price Contracts

A contractors group has welcomed a bipartisan House bill placed in the hopper last month aimed at curbing agency use of lowest price technically acceptable contracts.

The Promoting Value Based Procurement Act (H.R. 3019), introduced by Reps. Mark Meadows, R-N.C., and Don Beyer, D-Va., would amend the Federal Acquisition Regulation to require civilian agencies to align themselves with the Defense Department and stiffen their rationales for resorting to lowest price technically acceptable contracts, which have grown in use in recent years but are controversial.

“Price should not be the sole deciding factor when the federal government is purchasing complex, innovative information technology and engineering systems, where the least expensive option often may not lead to the best long-term value,” Beyer said in a statement to Government Executive. “We can help spur innovation by allowing contractors for certain high-tech procurements to compete on the strengths of their products, not the cost.”

The 2017 National Defense Authorization Act incorporated a previous version of the Meadows-Beyer bill for the Pentagon.

The new bill would mandate that agencies avoid such contracts except under these conditions:

• The agency is able to comprehensively and clearly describe the minimum requirements expressed in terms of performance objectives, measures and standards that will be used to determine acceptability of offers;
• The agency would realize no, or minimal, value from a contract proposal exceeding the minimum technical or performance requirements set forth in the request for proposal;
• 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;
• The source selection authority has a high degree of confidence that a review of technical proposals of offerors other than the lowest bidder would not result in the identification of factors that could provide value or benefit to the executive agency;
• The contracting officer has included a justification for the use of a lowest price technically acceptable evaluation methodology in the contract file; and,
• The executive agency has determined that the lowest price reflects full life-cycle costs, including for operations and support.

The 400-member Professional Services Council wrote the lawmakers to say it “understands that LPTA has a place in the acquisition toolbox” but that its “misuse can produce subpar results and increase long-term results to the government. It is particularly ill-advised to apply LPTA to complex professional or IT services,” the group continued, “where higher-level technical capabilities and innovation are often sought and the contracting requirements are often difficult to accurately define.”

The bill was referred to the Oversight and Government Reform Committee. Other co-sponsors include Reps. Gerry Connolly, D-Va., and Rob Wittman, R-Va.