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LPTA Contracts Hurting Industry And DoD, Astrium Services Government’s Chief Says

[caption id="attachment_85" align="alignleft" width="300"] Astrium Services Government President Ed Spitler. Photo: Astrium Services Government[/caption] The Defense Department’s trend of procuring commercial satellite communications (COMSATCOM) bandwidth through lowest price, technically acceptable (LPTA) contract evaluations stifles industry’s innovation to provide best value and supplies warfighters with inferior product, according to the CEO of a major COMSATCOM provider. Ed Spitler, president of Astrium Services Government, said last week Federal Acquisition Regulations (FAR) state an agency can obtain best value by using any one, or a combination of, source selection approaches. These include LPTA and tradeoff source selection process (TSSP), which allows for a tradeoff between non-cost factors and cost and price and allows the government to accept an other-than-the-lowest-price proposal. It also allows the government to select an other than the highest technically rated proposal to achieve a best value contract award, according to 2011 Office of the Secretary of Defense (OSD) guidance on source selection procedures. But Spitler said traditional source selection barometers like technical past performance and cost or price elements may vary and sometimes past performance is not even a factor in evaluation terms. “Sometimes (past performance) is not even recognized by the government because they just don’t care, they’re looking at price point,” Spitler told a Washington Space Business Roundtable (WSBR) lunch in downtown Washington. “More often than not, LPTA procurement practices have essentially defaulted to the lowest-priced bidder independent of quality.” Spitler said this trend of pricing for bandwidth puts key military functionalities, applications and value-added services at risk in exchange for lower prices. LPTA may work when contracting for fairly standardized, mass produced products or commodities, he said. But LPTA awards, Spitler said, also have the potential to undercut industry’s investment and initiative and qualities DoD has signaled as most important to COMSATCOM: resiliency and agility. “Any idea or innovation…you may have written the best proposal of your life and sent it in for that requirement, but it will never be read by the government because of the LPTA practices happening right now,” Spitler said. “It’s a shame because there’s no room for innovation when they do that.” Spitler cited findings from a study by Market Connections Inc. and Centurion Research Solutions that found LPTA contracts may be awarded to less qualified companies, may sacrifice long-term value for short-term cost savings and could act to lower contractors’ standards of performance. Part of the problem is that technically acceptable means different things to different people, and the government doesn’t always clarify what it means by this, Spitler said. In response to this, Spitler said industry should press and challenge DoD because technically acceptable could have a different meaning from contract to contract. “I think we have a responsibility as an industry to go back and educate the government,” Spitler said. “If there is something we don’t think makes sense, we should question it. I can tell you my organization sends questions every single day.” Astrium Services Government, a division of Airbus Group, delivers fixed satellite solutions including X-band, Ultra High Frequency (UHF), C-band, Ku-band and Ka-band, and mobile satellite solutions such as Inmarsat, Thuraya and Iridium. Airbus Group was formerly known under the European Aeronautic Space and Defense moniker.