The GFTA-3 is the standard formal test of articulation used by the vast majority of qualified speech and language pathologists. Unless there is reason to believe the administration was not valid, there is no obvious reason to doubt the validity of the instrument itself.
There are various levels of speech intelligibility that SLPs look at for functional impairment, including intelligibility in known speech, and in unknown speech. The former is essentially what you describe as somewhat functional for him--when the listener knows the general topic, and can thus scaffold for articulation errors in the speaker by using her own inferential reasoning. Until one has intelligibility in unknown speech, though, one is not truly communicating clearly and independently.
I would give serious consideration to the recommendations of the IEP team.
