The Promoting Value Based Procurement Act was forwarded by House Oversight lawmakers in September 2017. Its purpose is to require executive agencies to avoid using lowest price technically acceptable source selection criteria in certain circumstances, and for other purposes.
This is an important change that has been coming down the pike for several years. Increasingly, government procurement officials and their customers, the actual government activities, have noticed again and again, that “lowest price technically acceptable” contracts are a problem – especially after award.
LPTA was originally designed to give the contracting officers a tool to force lower prices and make easier bid decisions. They could assess the technical response on a pass-fail, then just award the lowest price bidder. Yet the end result has been disastrous, such companies who’ve lowered their labor prices so much that they’re unable to hire at those low rates.
These practices have already led to the decline of LPTA contracts, but this legislative initiative codifies that effect and makes it extremely difficult to use LPTA.
I discussed this with my favorite experienced (now retired) contracting officer (CO), and he did raise one interesting side effect: he postulated that we’ll see ‘better’ proposals. I disagreed, but we do agree that we’ll see more technology and innovation proposed in best value procurements; people will look for where they can get discriminators and have the right technical outcome.
In conclusion – we’ll see! In the meantime, for more insights on this legislation, see this NextGov article: House Panel Moves Bill Urging Federal Buyers to Consider Quality, Not Just Cost.
