In government contracting, not all proposals are graded the same. For each RFP, an agency defines its evaluation criteria based on the specific requirement. This helps the government use its budget responsibly while choosing the contractor that best fits its needs.
LPTA (Lowest Price Technically Acceptable)
One of the most widely recognized source selection methods is LPTA. In this approach, the technical evaluation is basically pass/fail. The government checks whether each proposal meets every minimum technical requirement. Among the proposals that pass, the award goes to the offeror with the lowest evaluated price.
In an LPTA competition, contractors don't receive extra credit for significantly exceeding the technical requirements. This puts a lot of pressure on price and can lead to extremely low margins. Contractors need to understand their costs, risks, and minimum acceptable margins to stay competitive without underbidding work they can't successfully deliver.
Best-Value Tradeoff
This approach is used when technical capability, past performance, or execution risk matters enough that the government may be willing to pay more for a stronger proposal. For example, a mission-critical DoD operation may weigh technical capability and past performance more heavily than price. However, price is never automatically secondary. The RFP will explain whether price is more important, less important, or approximately equal to the other evaluation factors.
What Changed with the RFO
With the Revolutionary FAR Overhaul, agencies were also formally presented with two additional source selection approaches. Not every agency has adopted the new Part 15 model deviation yet, but contractors should understand them.
The first is Highest Technically Rated with a Fair and Reasonable Price. Under this approach, the agency evaluates proposals using the non-price factors listed in the RFP. It then reviews the highest-rated proposal's price. If the price is fair and reasonable, that proposal is selected for award. If it isn't, the agency moves to the next-highest-rated proposal.
There is also phased acquisition. This approach breaks complex or high-risk work into separate phases, with distinct evaluations and awards at each stage. This gives the government more flexibility to adjust the requirement between phases instead of committing to the entire project upfront.
The main distinction is simple: LPTA asks who can meet the minimum requirements for the lowest price. A tradeoff asks whether a stronger proposal is worth paying more for. The highest-technically-rated approach prioritizes the strongest proposal as long as its price is reasonable.
Why This Matters Before You Write a Single Word
Knowing the evaluation method isn't a formality. It should shape your entire bid strategy. Bid an LPTA like it's a tradeoff, and you'll bury the proposal in extra detail that earns you nothing while your price creeps up. Bid a tradeoff like it's LPTA, and you'll win on price but lose to a competitor who invested more in past performance and technical depth.
Capto automatically extracts the evaluation criteria from a solicitation and flags which source selection method applies, so you know whether you're optimizing for price, technical strength, or both before you commit hours to a draft. From there, Capto's Pricer lets you simulate different win strategies against that evaluation method, so you can see how your price and technical posture actually trade off before you submit.