DEFENSE 

CONTRACTING

Factors DOD 

Considers When 

Choosing Best Value 

Processes Are 

Consistent with 

Guidance for Selected 

Acquisitions

Report to Congressional Committees

July 2014

GAO-14-584

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-584, a report to 

congressional committees

July 2014

DEFENSE CONTRACTING

Factors DOD Considers When Choosing Best Value 

Processes Are Consistent with Guidance for Selected

Acquisitions

Why GAO Did This Study

DOD obligated about $310 billion in 

fiscal year 2013 for products and 

services needed to support its mission.

To competitively acquire what is 

needed, DOD may use best value 

processes—including tradeoff and 

LPTA—to evaluate vendors’ proposals. 

When using the tradeoff process, DOD

weighs the relative importance of price 

against non-cost factors. By contrast, 

DOD may use the LPTA process and 

award the contract based on lowest 

price once technical requirements are 

met.

Congress mandated GAO to review 

DOD’s use of best value processes.

GAO identified, among other things,

(1) the extent to which DOD used best 

value processes in fiscal year 2013,

(2) the factors DOD considers when 

choosing a source selection process,

and (3) training DOD provides to its 

acquisition personnel on source 

selection processes.

GAO identified and reviewed 

solicitations for a projectable sample of 

183 contracts out of 2,851 new,

competitively awarded contracts that 

DOD awarded in fiscal year 2013 with 

obligations over $1 million. GAO also 

reviewed DOD and military 

departments’ guidance regarding their 

use of the best value process. GAO

selected 16 contracts for case studies

based on military department, best 

value process used, and other factors. 

GAO reviewed contract documents

and interviewed program and 

contracting officials for these case 

studies. GAO also reviewed DAU and 

military departments’ training on 

source selection procedures.

DOD provided technical comments that 

GAO incorporated as appropriate.

What GAO Found

The Department of Defense (DOD) used two best value processes—tradeoff and 

lowest price technically acceptable (LPTA)—for approximately 93 percent of the 

2,851 new, competitively awarded contracts awarded in fiscal year 2013 with 

obligations greater than $1 million. DOD used the tradeoff process most often in 

GAO’s sample of contracts to acquire services, regardless of obligation value. 

For contracts with higher obligations, DOD used the LPTA process primarily to 

acquire commercial products, such as fuel. In contrast, for contracts in GAO’s 

sample with lower obligations, DOD used the LPTA process to acquire both 

products and services. Several contracting and program officials said that their 

commands gave more attention to whether LPTA is an alternative option in light 

of declining budgets and efficiency initiatives. For contracts with obligations of 

$25 million or more, GAO found that DOD increased its use of LPTA since GAO 

last reported on this issue in October 2010 using fiscal year 2009 data. GAO’s 

prior report did not include contracts with lower obligations.

Estimated Source Selection Processes Used in Fiscal Years 2009 and 2013 for New, 

Competitively Awarded Contracts with Obligations of $25 million or Morea

Source selection 

process

Fiscal year 2009

percent

Fiscal year 2013

percent

Statistically significant 

changea

Tradeoff 69 58 Yes

Lowest price technically 

acceptable

26 36 Yes

Other 5 6 No

Source: GAO analysis of DOD contract and solicitation documents. | GAO-14-584 a

The 95 percent confidence intervals for estimates in this table are within +/- 8 percentage points of 

the estimates themselves.

DOD’s ability to clearly define its requirements and its knowledge of potential 

vendors were key factors that underpinned decisions about whether to use 

tradeoff or LPTA in GAO’s 16 case studies. In the eight case studies in which 

DOD used LPTA, contracting and program officials generally stated that they had 

sufficient knowledge of the requirements or vendors to feel confident that the 

lowest priced vendor, meeting DOD’s technical requirements, could deliver the 

product or service. In contrast, in the eight tradeoff case studies, contracting and 

program officials were less certain about requirements, were looking for 

innovative solutions, or wanted to use non-cost factors to differentiate vendors.

For example, the United States Army Corps of Engineers used technical 

non-cost factors to evaluate vendors’ abilities to use robotics for explosives 

disposal. These factors are generally consistent with guidance in the Federal 

Acquisition Regulation and DOD’s March 2011 source selection procedures.

DOD, through courses offered by the Defense Acquisition University (DAU) and 

the military departments, provides both classroom and online training related to 

source selection processes to its acquisition personnel. Both DAU and military 

department officials stressed, however, the importance of on-the-job training in 

preparing personnel to make informed source selection determinations. For 

example, Naval Facilities Engineering Command officials told GAO that 

determining when requirements are better suited for tradeoff or LPTA is learned 

through gaining experience from on-the-job training. View GAO-14-584. For more information, 

contact Timothy J. DiNapoli at (202) 512-4841

or dinapolit@gao.gov.
Page i GAO-14-584 Best Value Contracting 

Letter 1

Background 3

DOD Predominately Used Best Value Processes in Fiscal Year 

2013, but Increased Its Use of LPTA for Higher Dollar Contracts 

since Fiscal Year 2009 9

Knowledge of Requirements and Potential Vendors Underpin 

Decisions about Source Selection Process 13

DOD Provides Online and Classroom Training on Source 

Selection Processes, but On-the-Job Training Considered 

Essential for Making Sound Source Selection Decisions 17

Concluding Observations 22

Agency Comments 22

Appendix I Objectives, Scope, and Methodology 24

Appendix II Body Armor Vest Acquisitions in Fiscal Year 2013 28

Appendix III GAO Contact and Staff Acknowledgments 30

Tables

Table 1: DOD’s Use of Non-Cost Factors for the 96 Sample 

Contracts Awarded Using Tradeoff in Fiscal Year 2013 

GAO Reviewed, by Dollar Obligation 11

Table 2: Estimated Frequencies of Source Selection Processes 

Used in Fiscal Years 2009 and 2013 for New, 

Competitively Awarded Contracts with Obligations of 

$25 million or More 12

Table 3: Factors Affecting the Source Selection Decision Making 

Process for Selected Case Studies 14

Table 4: Defense Acquisition University (DAU) Courses 19

Table 5: Examples of Source Selection Courses Offered by 

Military Departments 20

Table 6: Total Population and Sample Size for the New, 

Competitively Awarded Contracts in Fiscal Year 2013 25

Contents
Page ii GAO-14-584 Best Value Contracting 

Figures

Figure 1: Source Selection Processes on the Best Value 

Continuum 4

Figure 2: DOD Contract Obligations for Products and Services in 

Fiscal Year 2013 (Dollars in billions) 8

Figure 3: DOD’s Use of Best Value Processes for the 171 Sample 

Contracts Awarded in Fiscal Year 2013 GAO Reviewed, 

by Dollar Obligation 10

Abbreviations

DAU Defense Acquisition University

DAWIA Defense Acquisition Workforce Improvement Act

DFARS Defense Federal Acquisition Regulation Supplement

DLA Defense Logistics Agency

DOD Department of Defense

FAR Federal Acquisition Regulation

FPDS-NG Federal Procurement Data System-Next Generation

IDIQ Indefinite Delivery Indefinite Quantity

LPTA Lowest Price Technically Acceptable

USACE United States Army Corps of Engineers

USD(AT&L) Under Secretary of Defense for Acquisition, Technology, 

and Logistics

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Page 1 GAO-14-584 Best Value Contracting 

441 G St. N.W.

Washington, DC 20548

July 30, 2014

Congressional Committees

The Department of Defense (DOD) obligated about $310 billion in fiscal 

year 2013 to acquire products and services needed to support its 

missions. DOD has several source selection processes it can use to 

evaluate vendors’ proposals. For example, DOD can use a best value 

tradeoff process, in which it can vary the relative importance of cost or 

price to other factors such as technical capability or past performance in 

its solicitations to vendors. In these cases, DOD may award a contract 

to other than the lowest-priced vendor if DOD determines that a 

higher-priced vendor provides a greater benefit to DOD, and this greater 

benefit is worth paying an additional cost, or price differential. 

Alternatively, DOD may also use a best value, lowest price technically 

acceptable (LPTA) process. In the LPTA process, DOD awards to the 

lowest priced vendor that is technically acceptable, and no tradeoffs are 

permitted. Proper implementation of these processes is essential to 

ensure that DOD lays the foundation for successful acquisition outcomes, 

especially at a time of declining spending.

Committee reports from the Senate and House Armed Services

committees and the Joint Explanatory Statement accompanying the 

National Defense Authorization Act for Fiscal Year 2014 mandated GAO 

to report on DOD’s use of best value processes.1

To determine the extent DOD used best value processes in fiscal year 

2013, we used the Federal Procurement Data System-Next Generation 

(FPDS-NG) to identify new, competitively awarded DOD contracts with 

GAO determined (1) the 

extent to which DOD used best value processes in fiscal year 2013, 

(2) the factors DOD considers when choosing a source selection process, 

and (3) training DOD provides to its acquisition personnel on source 

selection processes. In addition, in response to a matter identified in a 

2013 report from the House Armed Services Committee, appendix II 

includes information on the military departments’ acquisitions of body 

armor vests in fiscal year 2013.

 1

See S. Rep. No. 113-44, at 142 (2013), H.R. Rep. No. 113-102, at 185 (2013), and 159 

Cong. Rec. H7894, H7922 (December 12, 2013).
Page 2 GAO-14-584 Best Value Contracting 

obligations of over $1 million.2 From a population of 2,851 contracts with 

over $1 million in obligations, we selected a random projectable sample of 

227 contracts. We then used a $25 million threshold to divide our data set 

based on a Defense Federal Acquisition Regulation Supplement 

(DFARS) requirement that contracts for products or services with 

$25 million or more in estimated total costs for any fiscal year have 

written acquisition plans, which contain information on the anticipated 

source selection process.3 For contracts with obligations of $25 million or 

more, we compared the percentage of contracts solicited using the best 

value processes to fiscal year 2009 data that we reported in October 

2010.4 Our prior report did not include contracts with lower obligations. 

Ninety-three contracts from this sample had higher obligations of 

$25 million or more and 134 contracts had lower obligations over 

$1 million and less than $25 million. We determined that 44 contracts 

were either incorrectly coded, such as non-competed5

 2

FPDS-NG is the federal government’s system for tracking information on contracting 

actions.

contracts that were 

identified as competed or contracts that used source selection processes 

other than the best value processes. We excluded these contracts, which 

resulted in a total of 183 contracts in our sample that we reviewed, 

including 86 contracts with obligations of $25 million or more and 97 

contracts with obligations over $1 million and less than $25 million. After 

accounting for these errors and assessing the reliability of FPDS-NG data 

by electronically testing the data to identify problems with consistency, 

completeness, or accuracy and reviewing relevant documentation, we 

determined that FPDS-NG data were sufficiently reliable for the purposes 

of our review. We obtained and analyzed solicitation documents for all 

contracts in our sample to identify what source selection process DOD 

used. Further, we reviewed our sample of contracts that DOD awarded 

using tradeoff to identify how often DOD considered non-cost factors 

more important than price, and identified the most frequently used 

non-cost factors. We also used FPDS-NG and contract and solicitation 

documentation to identify characteristics of the contracts in our sample.

3

DFARS § 207.103(d)(i)(B).

4

GAO, Defense Contracting: Enhanced Training Could Strengthen DOD’s Best Value 

Tradeoff Decisions, GAO-11-8 (Washington, D.C.: Oct. 28, 2010).

5

For the purposes of this report, non-competed contracts consists of those contracts 

awarded under other than full and open competition as defined in Federal Acquisition 

Regulation subpart 6.3.
Page 3 GAO-14-584 Best Value Contracting 

To identify what factors DOD considers when choosing a source selection 

process, we analyzed the Federal Acquisition Regulation (FAR), DFARS, 

and DOD and military departments’ policy and guidance on source 

selection. We supplemented the review of these documents with 

interviews of senior DOD policy officials at Defense Procurement and 

Acquisition Policy, and at the Army, Navy, and Air Force headquarters. 

We also interviewed officials from at least two commands—based upon 

such factors as the number of contract actions and obligation amounts—

at each military department (Army, Navy, and Air Force), as well as the 

Defense Logistics Agency (DLA) to discuss factors affecting their decision 

on which source selection process to use. In addition, we selected 16 

new, competitively awarded contracts from our sample with obligations 

ranging from $1.1 million to $150.7 million in fiscal year 2013 to further 

our understanding of why acquisition—including contracting and 

program—officials chose a particular source selection process. Our 16 

case studies included a selection from each military department and DLA, 

different product and service types, and a mix of tradeoff and LPTA 

processes. We also interviewed industry associations to identify their 

perspectives about DOD’s source selection processes.

To determine what training DOD provides to its acquisition personnel on 

source selection processes, we met with Defense Acquisition University 

(DAU) officials and instructors and reviewed training materials. We also 

obtained workforce data from the DOD Office of the Under Secretary of 

Defense (Acquisition, Technology and Logistics), Human Capital 

Initiatives. Further, we collected and reviewed DOD and military 

departments’ training documents to identify additional source selection 

training that is given by them. A more detailed description of our scope 

and methodology is included in appendix I.

We conducted this performance audit from September 2013 through July 

2014 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.

FAR Part 15 allows the use of several competitive source selection 

processes to meet agency needs. Within the best value continuum, DOD 

may choose a process that it considers the most advantageous to the 

government, either the LPTA or the tradeoff process (see figure 1).

Background
Page 4 GAO-14-584 Best Value Contracting 

Figure 1: Source Selection Processes on the Best Value Continuum

DOD may elect to use the LPTA process where the requirement is clearly 

defined and the risk of unsuccessful contract performance is minimal. In 

such cases, DOD may determine that cost or price should play a 

dominant role in the source selection. When using the LPTA process, 

DOD specifies its requirements in the solicitation. Contractors submit their 

proposals and DOD determines which of the contractors meet or exceed 

those requirements, no tradeoffs between cost or price and non-cost 

factors are permitted, and the award is made based on the lowest price 

technically acceptable proposal submitted to the government.

By contrast, DOD may elect to use a tradeoff process in acquisitions 

where the requirement is less definitive, more development work is 

required, or the acquisition has a greater performance risk. In these 

instances, non-cost evaluation factors, such as technical capabilities or 

past performance, may play a dominant role in the source selection 

process. Tradeoffs among price and non-cost factors allow DOD to 

accept other than the lowest priced proposal. The FAR requires DOD to 

state in the solicitation whether all evaluation factors other than cost or 

price, when combined, are significantly more important than, 

approximately equal to, or significantly less important than cost or price.

In October 2010, we reported that DOD used best value processes for 

approximately 95 percent of its new, competitively awarded contracts in 
Page 5 GAO-14-584 Best Value Contracting 

which $25 million or more was obligated in fiscal year 2009.6 DOD 

awarded approximately 26 percent using the LPTA process and 69 

percent using the tradeoff process. DOD awarded the remaining 5 

percent using sealed bidding, which is a competitive process where 

award is made to the responsible bidder whose bid conforms to the 

invitations for bid and is most advantageous for the government 

considering only price and price-related factors included in the 

solicitation.7

DOD issued new guidance that emphasizes affordability and 

standardization of best value processes since our analysis of fiscal year 

2009 contracts. In September 2010, the Under Secretary of Defense for 

Acquisition, Technology, and Logistics (USD(AT&L)) issued a 

memorandum that established its Better Buying Power Initiative to obtain 

greater efficiency and productivity in defense spending. In its 

memorandum, USD(AT&L) emphasized that DOD must prepare to 

continue supporting the warfighter through the acquisition of products and 

services in potentially fiscally constrained times. USD(AT&L) noted that 

DOD must “do more without more.” In April 2013, USD(AT&L) issued 

At that time, we found that the majority of the contracts were 

awarded using a tradeoff process in which all evaluation factors other 

than cost or price, when combined, were significantly more important than 

cost or price. Our analysis showed that DOD considered past 

performance and technical capability evaluation factors as the most 

important among the non-cost factors. Further, we found using a tradeoff 

process can be more complex and take more time than other source 

selection methods, and requires that acquisition staff have proper 

guidance, needed skills, and sound business judgment. While DOD and 

the military departments had taken steps to improve source selection 

procedures, acquisition personnel noted a lack of training to assist them 

in deciding whether or not a price differential is warranted when making 

tradeoff decisions. We recommended that to help DOD effectively employ 

best value tradeoff processes, DOD develop training elements, such as 

case studies, that focus on reaching tradeoff decisions, as it updates its 

training curriculum. DOD concurred and implemented the 

recommendation in August 2012.

 6

GAO-11-8. Estimates of contracts based in this report were subject to sampling error. For 

example, the percentage estimates for contracts with obligations of $25 million or more 

have 95 percent confidence intervals within +/-8 percentage points of the estimate itself.

7

FAR § 14.101(e).
Page 6 GAO-14-584 Best Value Contracting 

another memorandum to update the Better Buying Power Initiative. This 

memorandum identifies seven areas USD(AT&L) is pursuing to increase 

efficiency and productivity in defense spending. One area is incentivizing 

productivity and innovation in industry and government. As part of this 

guidance, USD(AT&L) states that “best value” in a competitive source 

selection should generally indicate that the government is open to paying 

more (up to some amount) than the minimum price bid in return for a 

product that provides more than the minimum needed performance. In 

addition, USD(AT&L) states that LPTA should be used in situations where 

DOD would not realize any value from a proposal exceeding its minimum 

technical or performance requirements and that another process should 

be used when standards of performance and quality are subjective. A 

second area of this guidance includes improving the professionalism of 

the total acquisition workforce. DOD has previously reported that training 

is a critical element of improving and sustaining a high quality workforce 

with the right skills and capabilities.

USD(AT&L) also issued source selection procedures in March 2011 to 

standardize the methodology and process that DOD uses to conduct 

competitively negotiated source selections. For example, USD(AT&L) 

outlined a common set of principles and procedures for conducting 

acquisitions using the best value processes including the use of 

standardized rating criteria and descriptions for technical capability and 

past performance factors. Further, similar to information presented in the 

Better Buying Power Initiative, USD(AT&L) stated in the procedures that 

the LPTA process may be used in situations where the government would 

not realize any value from a proposal exceeding minimum technical or 

performance requirements, often for acquisitions of commercial or 

non-complex services or supplies which are clearly defined and expected 

to be low risk. In its April 2013 memorandum updating the Better Buying 

Power Initiative, USD(AT&L) directed the director of Defense 

Procurement and Acquisition Policy to update the guidance to describe 

the characteristics of a technically acceptable solution by July 1, 2013. As 

of July 2014, DOD officials are coordinating comments on a draft revision

of the guidance. The Defense Procurement and Acquisition Policy official 

in charge of the revision told us the original due date of July 1, 2013 was 

established before they decided to do a more comprehensive update of 

the guidance, which has contributed to the date slipping for its 

completion.

During the time that USD(AT&L) issued these initiatives and guidance—

specifically, between fiscal years 2009 and 2013—DOD experienced a 

number of changes in its contracting activity, including:
Page 7 GAO-14-584 Best Value Contracting 

• Total obligations for products and services decreased from 

$380 billion in fiscal year 2009 to $310 billion in fiscal year 2013,

• Obligations on new, competed contracts decreased from $70 billion in 

fiscal year 2009 to $43 billion in fiscal year 2013, and

• Obligations on new, competed contracts of $25 million or more 

decreased from $39 billion in fiscal year 2009 to $24 billion in fiscal 

year 2013.8

See figure 2 for our analysis of DOD’s contract obligations from

FPDS-NG for fiscal year 2013.

 8

All dollar values are in nominal terms. Values for fiscal year 2013 are based on

FPDS-NG data as of January 2014.
Page 8 GAO-14-584 Best Value Contracting 

Figure 2: DOD Contract Obligations for Products and Services in Fiscal Year 2013 

(Dollars in billions)a

a

Excludes obligations of $7.8 billion on non-DOD contracts. Values are based on Federal 

Procurement Data System-Next Generation as of January 2014.

b

The non-competed contracts category consists of those contracts awarded under other than full and 

open competition as defined in Federal Acquisition Regulation subpart 6.3.

Even though DOD’s obligations decreased between fiscal year 2009 and 

2013, it did acquire a similar mix of products and services in both years. 

In addition, the percentage of commercial items purchased in those 2 

fiscal years was approximately the same.
Page 9 GAO-14-584 Best Value Contracting 

DOD predominately used best value processes—tradeoff and LPTA—to 

evaluate offers from potential vendors in fiscal year 2013. DOD used best 

value processes for approximately 93 percent of the 2,851 new, 

competed contracts for which it had obligated over $1 million in fiscal year 

2013 and used sealed bid for approximately 7 percent.9 For contracts with 

obligations of $25 million or more, DOD used the tradeoff process for 

approximately 58 percent of the contracts and the LPTA process for 

approximately 36 percent of the contracts. For contracts with obligations 

over $1 million and less than $25 million, DOD used tradeoff and LPTA at 

about the same overall rate—47 percent and 45 percent, respectively.10

In our sample of 171 contracts that used best value processes, DOD 

used tradeoff for 96 contracts and LPTA for 75 contracts. We found some 

variation in terms of what process was used to acquire products and 

services at the different thresholds we reviewed (see figure 3).

 9

Sealed bids represented 12 of the 183 contracts in our sample.

10The percentage estimates for contracts with obligations of $25 million or more have a

95 percent confidence interval with a +/- 8 percent margin of error. The percentage 

estimates for contracts with obligations over $1 million and less than $25 million have a

95 percent confidence interval with a +/- 10 percent margin of error.

DOD Predominately 

Used Best Value 

Processes in Fiscal 

Year 2013, but 

Increased Its Use of 

LPTA for Higher 

Dollar Contracts since 

Fiscal Year 2009
Page 10 GAO-14-584 Best Value Contracting 

Figure 3: DOD’s Use of Best Value Processes for the 171 Sample Contracts 

Awarded in Fiscal Year 2013 GAO Reviewed, by Dollar Obligation

As seen in the above figure, DOD used the tradeoff process most often in 

our sample to acquire services, including those related to construction 

projects, aircraft maintenance, and other support services, regardless of 

obligation amount. For contracts with obligations of $25 million or more, 

DOD used the LPTA process primarily to acquire commercial products 

such as fuel. In contrast, for contracts with obligations over $1 million and 

less than $25 million, DOD used the LPTA process to acquire a mix of 

products and services, including fuel, aircraft parts, computer equipment, 

construction-related services, engineering support services, and ship 

maintenance and repairs.

The desire to weigh non-cost factors such as technical approach and past 

performance was a key factor cited in the majority of the solicitations 
Page 11 GAO-14-584 Best Value Contracting 

issued for the 96 contracts in our sample that DOD awarded using the 

tradeoff process, regardless of obligation value (see table 1).

Table 1: DOD’s Use of Non-Cost Factors for the 96 Sample Contracts Awarded 

Using Tradeoff in Fiscal Year 2013 GAO Reviewed, by Dollar Obligation

Contract 

obligation 

amount

Non-cost factors 

less important than 

price

Non-cost factors 

equal to price

Non-cost factors 

more important than 

price

Over $1 million 

and less than 

$25 million

0 5 41

$25 million or 

more

0 15 35

Source: GAO analysis of DOD solicitation and contract documents. | GAO-14-584

For the 76 contracts for which non-cost factors were more important than 

price, DOD acquired both products and services, such as computer 

equipment, aircraft maintenance services, and communication network 

support services.11

While data on DOD’s use of source selection processes were not readily 

available, our analysis found that DOD increased its use of LPTA from 

fiscal year 2009 to fiscal year 2013 for contracts with obligations of 

$25 million or more (see table 2). We cannot make a comparison 

between fiscal year 2009 and fiscal year 2013 for the lower dollar range, 

because our prior report only focused on contracts with obligations of 

$25 million or more in fiscal year 2009.

In addition, our analysis found that technical approach 

and past performance were the factors most often identified as more 

important than price among the non-cost factors. For example, 48 out of 

the 76 contracts in our sample identified technical approach as the most 

important factor. Additionally, 23 out of the 76 contracts in our sample 

identified past performance as the most important factor. Other non-cost 

factors considered in some of the solicitations with much less frequency 

than technical approach and past performance include small business 

participation and delivery schedule.

12

 11The majority of these contracts were firm-fixed-price. Other contract types for the 

remaining contracts included fixed-price with economic price adjustment and 

cost-plus-fixed-fee.

12GAO-11-8.
Page 12 GAO-14-584 Best Value Contracting 

Table 2: Estimated Frequencies of Source Selection Processes Used in Fiscal Years 

2009 and 2013 for New, Competitively Awarded Contracts with Obligations of 

$25 million or Morea

Source selection 

process

Fiscal year 2009

percent

Fiscal year 2013

percent

Statistically significant 

changea

Tradeoff 69 58 Yes

Lowest price technically 

acceptable 26 36 Yes

Sealed bid 5 6 No

Source: 2009: GAO-11-8; 2013: GAO analysis of DOD solicitation documents. | GAO-14-584

a

The 95 percent confidence intervals for estimates in this table are within +/- 8 percentage points of 

the estimates themselves.

Several contracting and program officials said that their commands gave 

more attention to whether LPTA is an alternative option in light of 

declining budgets and Better Buying Power Initiatives. Further, declining 

budgets encouraged contracting and program officials to streamline 

requirements. For example:

• The Executive Director of Army Contracting Command—Aberdeen 

Proving Ground, one of five Army Contracting Command centers—

said that overall there is an increased cost consciousness regarding 

acquisitions, resulting from the Better Buying Initiatives and declining 

budgets. As a part of that increased cost consciousness, there is an 

increased willingness and necessity to re-examine tools that could 

present better prices. For example, the Executive Director referred to 

LPTA as “a tool that has been at the bottom of the source selection 

tool box collecting dust for some time.” As it became necessary to 

take a look at what is really needed, they have “dusted off” the LPTA 

tool and had more discussions about how to set the technical 

acceptability at an appropriate level where there is no additional 

benefit from paying for more than that level.

• Contracting officials from Naval Facilities and Engineering Command 

stated that in the current fiscal environment of “doing more with less,”

they are educating their contracting personnel to use LPTA when 

appropriate. For example, on March 28, 2013, the Command sent an 

email communication to its contracting staff that provided guidance on 

the use of LPTA for task orders on multiple award contracts that are 

less than $10 million. The guidance stated that the contracting officer 

may choose to consider only price or cost for award purposes when 

the requirement is valued at less than $10 million, considered to be 
Page 13 GAO-14-584 Best Value Contracting 

non-complex, and where non-cost factors are deemed unnecessary. 

These officials stated LPTA is less complex and less time consuming 

than tradeoff, and as a result, they can save personnel resources. In 

addition to internal guidance, Navy officials told us that the Better 

Buying Power Initiative also directs acquisition personnel to look for 

efficiencies and streamlining in acquisitions.

• Contracting officials from Naval Supply Systems Command stated 

they increased their scrutiny on tradeoff acquisitions, which has 

contributed to a cultural shift to increase the consideration of LPTA as 

an alternative source selection process. The command issued an 

October 9, 2012 memorandum to contracting activities that states if 

non-cost factors are more important than price, the acquisition must 

be reviewed by a senior level acquisition executive.

• Similarly, Air Force Materiel Command contracting and program 

officials stated that given the budget environment, it is increasingly 

difficult to justify higher dollar solutions from a technical standpoint 

when solutions may exist that meet the minimum requirement.

• DLA contracting officials stated that in light of resource constraints, it 

is increasingly common to purchase products that meet the program’s 

needs without overstating the requirement. These officials told us 

LPTA is a good choice for mature, commercial requirements where 

there is no added value in conducting a tradeoff given the need to 

stretch budgets.

Our review of contract documents and interviews with program and 

contracting officials from our 16 case studies found that for these specific 

acquisitions, DOD’s ability to clearly define its requirements and its 

knowledge of potential vendors were the key factors that underpinned the 

decisions about whether to use tradeoff or LPTA. For example, in the 

eight case studies in which DOD used LPTA, DOD contracting and 

program officials generally stated they had sufficient knowledge of the 

requirements or vendors to feel confident that the lowest priced vendor, 

after meeting technical acceptability requirements, could deliver the 

product or service. In contrast, in our eight tradeoff case studies, 

contracting and program officials were less certain about requirements, 

were looking for innovative solutions, or wanted to use non-cost factors, 

such as past performance, as a differentiator when selecting the vendor. 

We found that for these 16 case studies DOD’s reasons for choosing 

LPTA or tradeoff were generally consistent with guidance in the FAR and 

DOD’s source selection procedures. Table 3 provides several highlights 

Knowledge of 

Requirements and 

Potential Vendors 

Underpin Decisions 

about Source 

Selection Process
Page 14 GAO-14-584 Best Value Contracting 

from the case studies that illustrate where DOD’s ability to clearly define 

its requirements and its knowledge of potential vendors affected the 

source selection decision making process.

Table 3: Factors Affecting the Source Selection Decision Making Process for Selected Case Studies

Source selection 

process

Military department/fiscal 

year 2013 obligation 

value/contract type

Description of the 

solicitation and requirements

Description of DOD knowledge of 

requirements and knowledge of vendors 

affecting the source selection decision

Lowest price 

technically 

acceptable

Navy

$5.2 million

Contract type: firm-fixed-price

This solicitation was for a 

follow-on contract to convert a 

‘.mil’ website to a ‘.edu’ website 

with email services.

Product or service: service

Number of bids received: 3

Awarded to incumbent: no

Knowledge of requirements: Navy 

contracting and program officials stated that 

the requirements for the system were 

well-defined as a result of prior work and 

had clear minimum technical standards that 

a vendor needed to meet. For example, one 

of the technical standards required vendors 

to have proven expertise with using and 

installing a particular commercially-available 

software program.

Knowledge of vendors: Navy contracting and 

program officials had a high level of 

confidence in vendor capability, because 

they had experience with and knowledge of 

industry vendors from a prior contract with 

similar requirements. Through market 

research, contracting officials determined 

that vendors had experience in providing 

similar services in previous acquisitions.

Lowest price 

technically 

acceptable

Air Force

$44.0 million

Contract type: firm-fixed-price

This solicitation was to build a 

system that mimics anti-aircraft 

missile systems. The Air Force 

previously awarded a sole 

source contract for this 

requirement. Following a 

management review, the 

solicitation was determined to 

be appropriate for competition.

Product or service: product

Number of bids received: 2

Awarded to incumbent: yes

Knowledge of requirements: Air Force 

contracting and program officials told us that 

this follow-on requirement was to replicate 

the functionality of an existing system for a 

planned procurement of 15 new units. Based 

on the historical experience of the 

contracting and program team, they were 

able to clearly define and convey the desired 

technical capability of the system.

Knowledge of vendors: Air Force contracting 

and program officials had previous 

experience and knowledge about the 

technical engineering capability of the 

vendors that can produce these missile 

systems. Through market research, 

contracting officials determined that several 

vendors had adequate technical capability to 

support competition.
Page 15 GAO-14-584 Best Value Contracting 

Source selection 

process

Military department/fiscal 

year 2013 obligation 

value/contract type

Description of the 

solicitation and requirements

Description of DOD knowledge of 

requirements and knowledge of vendors 

affecting the source selection decision

Lowest price 

technically 

acceptable

Navy

$66.4 million

Contract type: firm-fixed-price

This solicitation was to 

construct a replacement fuel 

pier.

Product or service: service

Number of bids received: 7

Awarded to incumbent: no

Knowledge of requirements: Navy 

contracting officials told us that this 

requirement was clearly defined as the 

solicitation was for the construction of the 

fully completed design that the Navy 

provided to the vendors at the time of 

solicitation. In addition, the requirement had 

previously been accomplished in a similar 

location so officials deemed it very low risk.

Knowledge of vendors: Navy contracting 

officials told us that they had knowledge of 

the size and capability of the local vendors, 

because some of the potential vendors had 

experience working on similar projects in the 

past.

Lowest price 

technically 

acceptable

Air Force

$1.3 million

Contract type: firm-fixed-price

This solicitation was for a 

weatherproof, name brand 

communication and control 

switch equipment.

Product or service: product

Number of bids received: 3

Awarded to incumbent: no

Knowledge of requirements: Air Force 

contracting officials stated that the 

requirement was for a modified commercial 

off-the-shelf item that had known vendors.

Knowledge of vendors: Air Force contracting 

officials were confident that multiple vendors 

could provide the name brand specific 

routers after conducting market research.

Tradeoff Defense Logistics Agency

$3.4 million

Contract type: fixed-price with 

economic price adjustment

This solicitation was for fabric 

dyeing for production of dress 

uniform fabric.

Product or service: product

Number of bids received: 1

Awarded to incumbent: yes

Knowledge of requirements/vendors:

Defense Logistics Agency contracting 

officials determined that tradeoff on past 

performance was required to ensure that the 

vendor would be able to provide dyed fabric 

within an acceptable color range. Officials 

told us that the stringent color specifications 

required vendors to have a level of 

competency and experience. Further, 

officials said that trading off on past 

performance informed them on vendor 

qualifications and mitigated the risk that an 

inexperienced vendor would bid at the 

lowest price to try and win the contract.
Page 16 GAO-14-584 Best Value Contracting 

Source selection 

process

Military department/fiscal 

year 2013 obligation 

value/contract type

Description of the 

solicitation and requirements

Description of DOD knowledge of 

requirements and knowledge of vendors 

affecting the source selection decision

Tradeoff United States Army Corps of 

Engineers (USACE)

$2.2 million

Contract type: firm-fixed-price

This solicitation was for use of 

robotics to dispose of 

explosives.

Product or service: service

Number of bids received: 3

Awarded to incumbent: no

Knowledge of requirements: USACE 

contracting officials told us they were 

seeking to differentiate vendors on their 

innovative technical capability in which 

robotics could be incorporated that improved 

the disposal process and reduced safety 

risks.

Knowledge of vendors: USACE contracting 

officials told us that they had performed 

market research to better understand the 

maturity of the robotic technology industry. 

Through market research, contracting 

officials determined that several vendors 

could potentially provide robotic technology 

applicable to explosives disposal.

Tradeoff Navy

$41.8 million

Contract type: firm-fixed-price

This solicitation was for Vertical 

Launching System Canisters, 

which are used to launch 

missiles from ships. The 

requirement included a 

technical data package 

containing the exact 

specifications that DOD

required.

Product or service: product

Number of bids received: 1

Awarded to incumbent: yes

Knowledge of requirements: Navy 

contracting and program officials told us that 

from their extensive knowledge and 

experience with these requirements, they 

knew that technical capability was a critical 

factor given the missile-related nature of the 

requirement. As a result, the program office 

wanted the discretion to discriminate on 

technical and safety factors to ensure 

demonstrated capability.

Knowledge of vendors: Navy’s market 

research included releasing a draft 

solicitation, holding an Industry Day to 

gauge industry interest, and sending the 

technical data package to multiple vendors. 

While the market research indicated that a 

number of vendors could potentially provide 

the desired product, only the incumbent bid 

for the requirement.

Source: GAO analysis of DOD solicitation and contract documents, Federal Procurement Data System-Next Generation data, and interviews with DOD officials. | GAO-14-584

Policy officials from some military departments noted that setting 

technical acceptability levels is important for contracts awarded through 

LPTA to be successful. Defense Procurement and Acquisition Policy 

officials told us the ongoing efforts to revise DOD’s 2011 source selection 

procedures is intended, in part, to further define how to conduct best 

value processes. According to these officials, the revised guidance will 

emphasize that for LPTA, the solicitation must clearly describe the 

minimum evaluation standards. In addition, they expect the guide will 

provide additional information on how to determine when to pay a price 

premium.
Page 17 GAO-14-584 Best Value Contracting 

DOD, through courses offered by DAU and the military departments, 

provides both classroom and online training related to source selection 

processes to its acquisition personnel. Both DAU and military department 

officials stressed, however, the importance of on-the-job training in 

preparing personnel to make informed source selection determinations.

Congress passed the Defense Acquisition Workforce Improvement Act 

(DAWIA) in 1990 to both ensure effective and uniform education, training, 

and career development of members of the acquisition workforce, 

including contracting and other career fields, and established DAU to 

provide training.13

DOD identified a need to increase the capacity and size of the acquisition 

workforce over the past several years. For example, in a DOD 

assessment of the contracting workforce completed in September 2008, 

senior DOD contracting leaders identified the importance of not only 

mastering the “what,” but in using critical thinking and sound judgment to 

apply the knowledge—thus mastering the “how” of contracting among its 

entry-level and mid-career personnel. To help address concerns that 

DOD had become too reliant on contractors to support core functions and 

to rebuild the capacity and skill sets that eroded in the years that followed 

the downsizing of the workforce in the 1990s, DOD increased its number 

of acquisition workforce positions from 133,103 in fiscal year 2009 to 

151,355 in fiscal year 2013—including a 9.5 percent increase or an 

additional 2,616 positions—in the contracting career field.

The act also required DOD to establish career paths, 

referred to by DOD as certification requirements, for the acquisition 

workforce. DOD military departments must track acquisition workforce 

personnel to ensure that they meet mandatory standards established for 

level I (basic or entry), level II (intermediate or journeyman), or level III 

(advanced or senior) in a career field, such as contracting, life cycle 

logistics, and program management. Similar requirements and levels are 

established for each of the acquisition career fields identified by DOD.

DAU officials identified five training courses that are taken either online or 

in the classroom to provide acquisition personnel, including contracting 

and program officials, the knowledge and skills necessary to make source 

selection decisions. Contracting personnel are required or recommended 

to complete all five of the identified training courses at some point in their 

 13Pub. L. No. 101-510, § 1202(a) (1990).

DOD Provides Online 

and Classroom 

Training on Source 

Selection Processes, 

but On-the-Job 

Training Considered 

Essential for Making 

Sound Source 

Selection Decisions
Page 18 GAO-14-584 Best Value Contracting 

career to obtain specific DAWIA certifications. Additionally, DAU makes 

these classes available to personnel outside the DAWIA acquisition 

workforce. Based on our analysis of student self-reported exit data in 

fiscal year 2013 and our discussion with DAU officials, we found that 

many graduates for these courses did not indicate their career field when 

completing the course registration or exit survey, particularly for online 

courses, which makes it difficult to know how many personnel outside of 

the DAWIA workforce with acquisition-related responsibilities took these 

courses. In September 2011, we reported on personnel working on 

service acquisitions who are outside the DAWIA acquisition workforce 

with acquisition-related responsibilities and found the number of these 

individuals to be substantial. As such, we recommended that the 

Secretary of Defense establish criteria and a time frame for identifying 

personnel outside the DAWIA acquisition workforce with 

acquisition-related responsibilities.14 DOD concurred with the 

recommendation and, as of June 2014, is developing a way to identify all 

of the non-DAWIA personnel with acquisition-related responsibilities and 

the appropriate training curriculum they should receive. Table 4 outlines 

each of these five courses.

 14GAO, Defense Acquisition Workforce: Better Identification, Development, and Oversight 

Needed for Personnel Involved in Acquiring Services, GAO-11-892 (Washington, D.C.: 

Sept. 28, 2011).
Page 19 GAO-14-584 Best Value Contracting 

Table 4: Defense Acquisition University (DAU) Courses

Course title Course description Targeted attendees

Other career field required or 

recommended attendees

CLC 007: 

Contract

Source Selection

An online, continuous learning module that 

contains three lessons focused solely on 

source selection. Learning objectives 

include:

• roles and responsibilities of each 

source selection participant,

• procedures for safeguarding source 

selection information,

• key elements of a source selection 

plan,

• evaluation criteria to best support an 

award recommendation,

• appropriate elements of debriefing, and

• importance of effective dialogue with 

vendors.

Personnel new to the 

contracting career field or 

non-contracting 

personnel that play a role 

in the acquisition 

process. 

• Cost estimating

• Financial management

• Life cycle logistics

• Production, quality and 

manufacturing

CON 121: 

Contract Planning

An 8-part online contract planning training 

course. Lesson 8 covers acquisition strategy 

development, which includes:

• characteristics of best value,

• elements of and criteria used in 

developing a written acquisition plan,

and

• elements of source selection planning.

Personnel new to the 

contracting career field or 

non-contracting 

personnel that play a role 

in the acquisition 

process.

• Financial management

• Industrial and/or contract 

property management

• Life cycle logistics

• Program management

• Purchasing

CON 200: 

Business Decisions for 

Contracting

An 11-part online training course that builds 

on Level I (basic or entry) pre-award 

business and contracting knowledge to 

process complex procurements. Lesson 10 

provides an overview on source selection 

strategy and discusses the tradeoff versus 

LPTA decision.

Contracting personnel 

with at least 2 years of 

contracting experience in 

the contracting career 

field seeking intermediate 

certification.

• Industrial and/or contract 

property management

CON 280: 

Source Selection and 

Administration of Service 

Contracts

A 10-day in-classroom training course. The 

primary focus of this course is on the 

acquisition of services under FAR Part 15 

procedures with an emphasis on 

performance-based acquisitions for 

services; contract types, incentives, and 

administration; as well as source selection. 

On days 4-7, students participate in group 

exercises designed to replicate the source 

selection development, evaluation, and 

decision processes.

Contracting personnel 

with at least 2 years of 

contracting experience in 

the contracting career 

field seeking intermediate 

certification.

• Life cycle logistics
Page 20 GAO-14-584 Best Value Contracting 

Course title Course description Targeted attendees

Other career field required or 

recommended attendees

CON 334: 

Advanced Contingency 

Contracting Officer’s 

Course

A 4-day in-classroom training course with 

exercises focused on the unique aspects of 

contingency operations, critical thinking 

skills, and the execution of appropriate 

contractual instruments. In lesson 6, 

participants are introduced to the elements 

of the formal source selection process, 

which they utilize later to prepare a mock 

solicitation.

Contracting career field 

personnel who are in 

deployable positions and 

will be the designated 

Chief of the Contracting 

Office or Senior 

Contracting Official.

• Not applicable

Source: GAO analysis of DAU documents. | GAO-14-584

We also found that military departments provided source selection 

training—offering both overview and refresher courses—to contracting 

staff and others involved in the source selection process. Table 5

identifies examples of the training courses offered by various military 

departments.

Table 5: Examples of Source Selection Courses Offered by Military Departments

Military department/course title Course description Targeted attendees

Air Force Source Selection 

Training Phase I and Phase II

This course provides basic refresher training on best 

value acquisitions to the source selection team. During 

Phase I of the training, the source selection team 

develops and jointly plans the acquisition strategy based 

upon the customer identified requirements for a current 

acquisition. Phase II, also known as “just-in-time” training 

assists the source selection team in evaluating and 

executing the contract for a current acquisition.

Every member involved in the 

acquisition process from source 

selection to contract award as well as 

those in the contracting career field. 

Additionally, this course is offered in 

abbreviated format for Senior 

Executive Service level participants.

Army (Medical Research 

Acquisition Activity) Lowest Price 

Technically Acceptable (LPTA) 

Source Selection Process: 

Banging the Basics

This course provides an overview of best value 

acquisitions. It includes discussion of the best value as 

outlined in Federal Acquisition Regulation (FAR) Part 15, 

identifies for class participants when LPTA is the 

appropriate source selection process for a particular 

acquisition, and stresses the importance of consistency 

within the request for proposal.

Contracting and other personnel 

involved in choosing the source 

selection process.

Defense Logistics Agency Back to 

Basics

This course is a refresher training to address areas 

where there may be skill gaps in contracting. It identifies 

situations when tradeoff versus LPTA might be used and 

roles and responsibilities of those involved in source 

selection.

Contracting personnel.

Marine Corps Systems Command 

Kapstone Source Selection 

Training

This course outlines the source selection process and 

the roles of those involved in source selection. It 

identifies situations when tradeoff versus LPTA might be 

used.

Contracting and program personnel.

Navy CTC 415: Source Selection 

Technical Evaluation

This course provides students with an overview of the 

source selection process and responsibilities of those 

involved in source selection.

Contracting personnel and program 

managers involved in the source 

selection process.

Source: GAO analysis of military department documents and interviews with military department officials. | GAO-14-584
Page 21 GAO-14-584 Best Value Contracting 

DAU and military department officials we spoke with pointed to their 

training as providing educational resources from which the acquisition 

workforce can understand the basics of appropriate source selection 

processes. These officials also stressed the role on-the-job training plays 

when making such determinations. For example, policy officials within the 

office of the Assistant Secretary of the Army for Acquisition, Technology, 

and Logistics told us that on-the-job training provides important exposure 

for less experienced acquisition staff to the source selection decision 

making processes. As a result, contracting officials have a better 

understanding of situations where a particular source selection process 

may be more appropriate than others. Many officials told us that 

contracting officials can best understand the acquisition process and 

apply their in-classroom training through making real world source 

selection decisions. As such, several military department officials, 

including contracting officials from our case studies, provided examples of 

why they consider on-the-job training to be important, including the 

following:

• Air Force Installation Contracting Agency contracting officials from 

one of our case studies and a command official told us that on-the-job 

training and experience are important factors that affect the source 

selection process determination. They stated that on-the-job training 

provides experience and opportunities for contracting officers to make 

critical decisions that can only occur in a source selection 

environment. To that end, these officials told us that informal 

mentoring relationships are established wherein newer, less 

experienced staff is assigned to work with more senior staff.

• Naval Facilities Engineering Command officials and contracting 

officials from one of our case studies stated that the task of identifying 

when requirements would better suit a particular source selection 

process is learned through gaining experience from on-the-job 

training.

• Naval Sea Systems Command officials from one of our case studies 

stated that the best training they received is on-the-job training. These 

officials explained that more senior contracting officers help newer 

contracting staff with their acquisitions. They consider mentor type 

training invaluable in learning how to conduct an acquisition.
Page 22 GAO-14-584 Best Value Contracting 

Best value processes continued to underlie the vast majority of DOD’s 

new, competitively awarded contracts. DOD has increased its use of the 

LPTA process in recent years for higher value contracts, and its decision 

making regarding which source selection process to use did not appear to 

be ill-advised. Its decision making was generally rooted in knowledge 

about the requirements and vendors. In our sample of 16 cases, we 

identified instances in which DOD used LPTA for what appeared to be 

complex acquisitions, such as the system to mimic an anti-aircraft missile, 

but the acquisition team had considerable knowledge about the 

requirements or vendors. In other cases, DOD used the tradeoff process

for what appeared to be relatively simple acquisitions, such as fabric 

dyeing, yet the acquisition team identified complexities about the 

proposed acquisition. Amid the climate of rapidly building fiscal pressures 

and cost consciousness, selecting the right source selection approach 

continues to be essential to ensure the department acquires what it needs 

without paying more than necessary.

We are not making recommendations in this report. We provided a draft 

of this report to DOD for comment. DOD did not provide written 

comments on this report but did provide technical comments, which we 

incorporated as appropriate.

We are sending copies of this report to appropriate congressional 

committees and the Secretary of Defense. The report will be available at 

no charge on GAO’s website at http://www.gao.gov.

If you or your staff have questions about this report, please contact me at 

(202) 512-4841 or dinapolit@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this report. GAO staff who made major contributions to this report are 

listed in appendix III.

Timothy J. DiNapoli

Director

Acquisition and Sourcing Management

Concluding 

Observations

Agency Comments
Page 23 GAO-14-584 Best Value Contracting 

List of Committees

The Honorable Carl Levin

Chairman

The Honorable James Inhofe

Ranking Member

Committee on Armed Services

United States Senate

The Honorable Richard J. Durbin

Chairman

The Honorable Thad Cochran

Ranking Member

Subcommittee on Defense

Committee on Appropriations

United States Senate

The Honorable Howard P. “Buck” McKeon

Chairman

The Honorable Adam Smith

Ranking Member

Committee on Armed Services

House of Representatives

The Honorable Rodney Frelinghuysen

Chairman

The Honorable Pete Visclosky

Ranking Member

Subcommittee on Defense

Committee on Appropriations

House of Representatives
Appendix I: Objectives, Scope, and 

Methodology

Page 24 GAO-14-584 Best Value Contracting 

Committee reports from the Senate and House Armed Services 

committees and the Joint Explanatory Statement accompanying the 

National Defense Authorization Act for Fiscal Year 2014 mandated GAO 

to report on the Department of Defense’s (DOD) use of best value

processes.1

To determine the extent DOD used the best value processes in fiscal year 

2013, we used data from the Federal Procurement Data System-Next 

Generation (FPDS-NG) as of October 2013 to identify a population of 

contracts based on the following criteria: (1) newly awarded by DOD in 

fiscal year 2013, (2) competitively awarded, and (3) had obligations of 

over $1 million in fiscal year 2013. This analysis identified a population of 

2,851 contracts, and from this population we selected a stratified random 

sample of 227 contracts, with the strata defined by whether the contract 

had obligations of $25 million or more, or whether its obligations totaled 

over $1 million and less than $25 million. We divided the data into two 

groups including contracts with higher obligations of $25 million or more 

and contracts with lower obligations over $1 million and less than 

$25 million. We used the $25 million threshold to divide our data set 

based on a Defense Federal Acquisition Regulation Supplement 

(DFARS) requirement that contracts for products or services with 

$25 million or more in estimated total costs for any fiscal year have 

written acquisition plans, which contain information on the anticipated 

source selection process.

We determined 1) the extent to which DOD used best value 

processes in fiscal year 2013; (2) the factors DOD considers when 

choosing a source selection process; and (3) training DOD provides to its 

acquisition personnel on source selection processes. In addition, in 

response to a matter identified in a 2013 report from the House Armed 

Services Committee, appendix II includes information on the military 

departments’ acquisitions of body armor vests in fiscal year 2013.

2 For contracts with obligations of $25 million or 

more, we compared the percentage of contracts solicited using best value 

processes to fiscal year 2009 data we reported in October 2010.3

 1

See S. Rep. No. 113-44, at 142 (2013), H.R. Rep. No. 113-102, at 185 (2013), and 159 

Cong. Rec. H7894, H7922 (December 12, 2013).

Our 

prior report did not include contracts with lower obligations of less than 

$25 million.

2

DFARS § 207.103(d)(i)(B).

3

GAO, Defense Contracting: Enhanced Training Could Strengthen DOD’s Best Value 

Tradeoff Decisions, GAO-11-8 (Washington, D.C.: Oct. 28, 2010).

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology

Page 25 GAO-14-584 Best Value Contracting 

We obtained and analyzed the solicitation documents for all of the 

contracts in our sample to identify the source selection process DOD 

used. We verified the contract award fields in FPDS-NG with contract and 

solicitation data to ensure that the contracts within our sample were 

in-scope. Based on that analysis, we determined that a total of 44 

contracts were out of scope for our review. These 44 contracts were 

excluded from our analysis, because they were either incorrectly coded in 

our key parameters, or were awarded using processes outside of the 

Federal Acquisition Regulation (FAR) Part 14 on sealed bidding or Part 

15 on contracting by negotiation (which includes best value processes)

and consequently should not have been in our sample, resulting in a total 

of 183 contracts in our review (see table 6). After accounting for these 

errors, we assessed the reliability of FPDS-NG data by electronically 

testing the data to identify problems with consistency, completeness, or 

accuracy and reviewed relevant documentation. We determined that the 

FPDS-NG data were sufficiently reliable for the purposes of our review.

Table 6: Total Population and Sample Size for the New, Competitively Awarded 

Contracts in Fiscal Year 2013

Obligation strata Population Sample size In-scope Out-of-scope

$25 million or more 193 93 86 7

Over $1 million and less than 

$25 million

2,658 134 97 37

Total 2,851 227 183 44

Source: GAO analysis of DOD solicitation and contract documents and Federal Procurement Data System-Next Generation data. | 

GAO-14-584

Because we followed a probability procedure based on random selection, 

our sample is only one of a large number of samples that we might have 

drawn. Since each sample could have provided different estimates, we 

express our confidence in the precision of our particular sample’s results 

as a 95 percent confidence interval (e.g., plus or minus 8 percentage 

points). This is the interval that would contain the actual population value 

for 95 percent of the samples we could have drawn. Unless otherwise 

noted, percentage estimates of contracts with obligations of $25 million or 

more have 95 percent confidence intervals within +/- 8 percentage points 

of the estimate itself. Similarly, for contracts with obligations over 

$1 million and less than $25 million, percentage estimates have 

confidence intervals within +/- 10 percentage points of the estimate itself.

In addition, to compare characteristics of contracts in our sample that 

used best value processes for both strata, we determined contract type, 
Appendix I: Objectives, Scope, and 

Methodology

Page 26 GAO-14-584 Best Value Contracting 

the type of procurement (product versus service), and if commercial item 

procedures were used for our sample using FPDS-NG data and 

conducted data reliability analysis on these fields, by verifying this 

information with the contract and solicitation documents. For the contracts 

identified as tradeoff, we analyzed the contract and solicitation 

documentation to identify the most frequently used non-cost evaluation 

factors and their relative importance to price.

To identify what factors DOD considers when choosing a source selection 

process, we analyzed the FAR, DFARS, and DOD and military 

departments’ regulation, policy, and guidance on source selection. We 

interviewed senior DOD policy officials at Defense Procurement and 

Acquisition Policy, and at the Army, Navy, and Air Force headquarters. 

We also interviewed officials from at least two buying commands—based 

upon such factors as the number of contract actions and obligation 

amounts—at each military department (Army, Navy, and Air Force), as 

well as the Defense Logistics Agency (DLA) to discuss factors affecting 

their decision process on which source selection process to use. In 

addition, we analyzed our sample of 183 contracts and selected 16 new, 

competitively awarded contracts with obligations ranging from $1.1 million 

to $150.7 million to further our understanding of why acquisition officials 

chose the source selection process. Our 16 case studies—8 tradeoff and 

8 LPTA—included at least 1 from each military department and DLA, 

different product and service types, and amount of dollars obligated in 

fiscal year 2013. For the case studies, we interviewed DOD contracting 

and program officials and reviewed contract documentation, including the 

acquisition plan, solicitation, and source selection decision memorandum 

to further understand the source selection decision making process. The 

results from our review of these selected contracts cannot be generalized 

beyond the specific contracts selected.

During the course of our review, we also interviewed officials from the 

following commands:

• Department of the Army, Army Contracting Command, Aberdeen 

Proving Ground, Maryland; Medical Command, Fort Detrick, 

Maryland; and Intelligence and Security Command, Fort Belvoir, 

Virginia

• Department of the Army, United States Army Corps of Engineers, 

Washington, D.C., and Huntsville Center, Alabama
Appendix I: Objectives, Scope, and 

Methodology

Page 27 GAO-14-584 Best Value Contracting 

• Department of the Navy, Naval Air Systems Command, Patuxent 

River, Maryland; Naval Facilities Command, Navy Yard, Washington, 

D.C.; and Naval Supply Systems Command, Mechanicsburg, 

Pennsylvania

• Department of the Navy, United States Marine Corps Installations and 

Logistics Command, Navy Annex, Virginia; and Marine Corps 

Systems Command, Quantico, Virginia

• Department of the Air Force, Installation Contracting Agency and Air 

Force Materiel Command, both located at Wright-Patterson Air Force 

Base, Ohio

• Defense Logistics Agency-Energy, Ft. Belvoir, Virginia; and Defense 

Logistics Agency-Troop Support, Philadelphia, Pennsylvania

• Joint Theater Support Contracting Command, Kabul, Afghanistan.

To determine what training DOD provides to its acquisition personnel on 

source selection processes, we met with Defense Acquisition University 

(DAU) officials and instructors and reviewed training materials. We also 

obtained attendance and workforce data from the DOD Office of the 

Under Secretary of Defense (Acquisition, Technology, and Logistics), 

Human Capital Initiatives. Further, we collected and reviewed military 

department and command specific training documents to identify if 

additional source selection training is given in addition to DAU provided 

training. We also interviewed DOD policy officials at Defense 

Procurement and Acquisition Policy, several commands at the military 

departments, as well as contracting and program personnel at the 

contracting offices of the selected military departments from the 16 case 

studies on training provided related to source selection processes.

We supplemented these case studies with interviews with industry 

associations to identify their perspectives about DOD’s source selection 

processes.

We conducted this performance audit from September 2013 through July 

2014 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.
Appendix II: Body Armor Vest Acquisitions in 

Fiscal Year 2013

Page 28 GAO-14-584 Best Value Contracting 

The Marine Corps, Defense Logistics Agency (DLA), and Army bought 

similar soft body armor vests made of ballistic material in fiscal year 2013 

using different source selection processes. Knowledge of requirements or 

vendors were key considerations in each acquisition, but distinct needs 

led to different decisions about which source selection process to use 

even when acquiring the similar product.

• The Marine Corps issued one delivery order to purchase soft body 

armor vests for $2.3 million in fiscal year 2013 using the lowest price 

technically acceptable (LPTA) process. It issued this order from a 

multiple award, indefinite delivery indefinite quantity (IDIQ) contract1

awarded to two vendors in fiscal year 2009 using the LPTA process. 

The contracting officer told us they chose to use LPTA for the base 

contract because they consider soft body armor vests to be a 

commodity product with clearly defined technical performance 

specifications. Further, the contracting officer, in consultation with the 

program office, saw no opportunity for tradeoff above industry 

standard because the industry standard met their current needs. 

Ongoing research and development showed that any tradeoff for 

enhanced performance would lead to the armor being heavier, an 

unacceptable outcome. For the base contracts, the Marine Corps 

awarded to the second and third lowest priced vendors, because the 

lowest priced vendor was deemed non-responsible.2

• DLA issued 23 delivery orders to purchase soft body armor vests for 

$288.1 million in fiscal year 2013. It issued these orders from three 

separate IDIQ contracts awarded to three vendors in fiscal years 2011 

and 2012 using the tradeoff process. DLA contracting officials told us 

that they chose to use the tradeoff process for these contracts 

because they wanted to use past performance as a key discriminator, 

which is generally not allowed using the LPTA process. Further, 

because DLA buys for sustainment purposes and its quantity needs 

 1

Agencies may award more than one contract to more than one vendor (known as a 

multiple award contract) from a solicitation. An IDIQ contract is a type of indefinite delivery 

contract that provides for an indefinite quantity of supplies or services within stated limits, 

during a fixed period.

2

According to the Federal Acquisition Regulation (FAR), Prospective Contractors, to be 

determined responsible, must have among other things, adequate financial resources, be 

able to comply with the required or proposed delivery or performance schedule, have a 

satisfactory performance record, and have a satisfactory record of integrity and business 

ethics. FAR § 9.104-1.

Appendix II: Body Armor Vest Acquisitions in 

Fiscal Year 2013
Appendix II: Body Armor Vest Acquisitions in 

Fiscal Year 2013

Page 29 GAO-14-584 Best Value Contracting 

fluctuate, officials told us that past performance was a critical 

determination factor requiring the use of the tradeoff process, in 

addition to the vendor’s historic production capacity, delivery 

schedule, and other performance capabilities.

• The Army issued one delivery order to purchase soft body armor 

vests for $10,201 in fiscal year 2013 using the LPTA process. It 

issued this order from one of the multiple award, IDIQ contracts 

awarded to eight vendors in fiscal years 2009 and 2010 using the 

tradeoff process. Army contracting officials told us they chose to use 

the tradeoff process for the base contract, because it provided the 

Army more discretion in evaluating past performance as well as 

leaving open the possibility that industry vendors might offer a more 

innovative solution. Once the Army had a group of qualified vendors 

on contract, they could then use the LPTA process for subsequent 

buys.
Appendix III: GAO Contact and Staff 

Acknowledgments

Page 30 GAO-14-584 Best Value Contracting 

Timothy J. DiNapoli, 202-512-4841 or dinapolit@gao.gov

In addition to the contact name above, the following staff members made 

key contributions to this report: Molly Traci, Assistant Director; James 

Kim; Anh Nguyen; Erin Stockdale; Jina Yu; Claire Li; Jessica Drucker; 

Danielle Greene; Roxanna Sun; John Krump; Mark Ramage; Julia 

Kennon; Virginia Chanley; and Carol Petersen.

Appendix III: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments

(121168)
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