by Louis J. Jenny and Geoff Corey | January 13, 2015
Federal regulations lay out a number of ways the government can negotiate and contract with the private sector to provide services or goods. One of these methods is known as Lowest Price Technically Acceptable, or LPTA. While there are situations when LPTA makes sense, DBIA has released a position statement opposing its use in federal, state or municipal government contracting for design-build services. As the only organization that defines, teaches and promotes best practices in design-build, DBIA’s position statement carries weight and sends a strong message to owners and practitioners alike.
LPTA is when the government sets minimum standards before accepting proposals, and then chooses the lowest bidder. It works well for purchasing commodities or fairly simple services. For example, when purchasing office supplies or uniforms or contracting for services like laundry or custodial work, it makes sense for the government to choose the lowest bidder, as long as the commodities or services provided meet minimum standards. LPTA gives the government a good mechanism for negotiating contracts in such a situation.
However, LPTA can be very limiting when contracting for complex professional services and where quality and innovation are important, such as design-build services. With design-build, exceeding the basic parameters of a contract will bring increased value to the federal government, and is indeed why Design-Build Done Right is highly desirable and the recommended method for government project delivery.
Instead of LPTA, DBIA recommends government entities follow the Two-Phase Design-Build Selection Procedure or qualifications-based selection (QBS), especially when technical solutions, quality, schedule, past performance and innovation are key components to achieving a project’s success. These processes allow contracting officers to appropriately balance cost with quality, technical competency and the past performance of a design-build team. Studies and experience have shown two-phase and QBS design-build offer the government the best opportunity to meet or exceed project goals and bring a project to completion on time and with little or no adversarial disputes, claims or litigation.
DBIA recommends all levels of government should cease using LPTA when contracting for design-build services. Fully embracing the procurement practices as defined by DBIA’s Design-Build Done Right best practices will help achieve best value for the government and the taxpayer.