# Presentation: 748377

## Technology InvestmentsAgreements (TIAs)

- 		Training Course
- 		May 2006

## What is DOE’s “other transactions” authority?

-   EPACT 2005, Section 1007 – “Other Transactions” - grants the Secretary authority
- to enter into transactions other than contracts, cooperative agreements, and grants
- subject to the same terms and conditions as DoD under Section 2371 of Title 10 U.S.C.

## What is an “other transaction” (OT)?

- OTs defined by what they are not
-  a transaction other than a contract, grant, or cooperative agreement
- Not subject to procurement laws, FAR, DEAR, or DOE Assistance Regulations
- Potentially many kinds of instruments

## What is the purpose of this new OT authority?

- Some for-profit firms do not participate in Federal RD&D programs because of unique Government requirements, such as
- system requirements
- cost principles
- IP requirements
- Purpose of OT authority is to broaden the technology base available for DOE RD&D programs by reducing barriers.

## How did DoD implement Section 2371?

- Two different regulations/instruments
- OTs for prototype projects - if purpose is to acquire goods and services for DoD.
- called “Other Transactions.”
- OTs for research - if purpose is stimulation and support of a public purpose authorized by law.
- called “Technology Investment Agreements” (TIAs).

## How did DOE implement its OT authority?

- Except for NNSA and EM, DOE does not generally acquire RD&D for its own use
- Decided not to develop OT guidance for acquisitions at this time
- Developed guidance only for assistance
- Adopted the DoD name for these awards
- TIAs

## Where are the DOE regulations?

- DOE decided to issue a new part to its assistance rule (10 CFR Part 603)
- Similar to DoD’s TIA rule, but tailored to DOE mission requirements
- Final rule was published in Federal Register on 5/9/06 – effective 7/10/06
- Financial Assistance Letter 2006-03 provides additional implementing guidance for TIAs.

## How did TIAs evolve?

- 1989 – Congress gave DARPA authority to use _assistance_ instruments other than grants or cooperative agreements for research (pilot)
-   Expanded authority to all DoD in 1992.
-   TIAs evolved from:
-  DARPA’s OT consortium agreements
-  Military Department’s “flexible” cooperative agreements.
- 1997 DoD merged two types of agreements into a single class of instruments called TIAs.

## What are the two kinds of TIAs?

**    **_**Flexible Cooperative Agreement**_
**42 U.S.C. 7256(a)**
**Flexible (10 CFR 600 applies only if specified in agreement)**
**Bayh-Dole Act and DOE patent statutes that provide for a free Govt. license and other restrictions, apply.**

**    **_**Other Than a Grant or**__ __**Cooperative Agreement**_** **
**42 U.S.C. 7256(g)**
**Maximum flexibility**
**Useful for consortia or teaming arrangements**
**Exception to Bayh-Dole and DOE patent statutes.**

## Slide 10

## Who must approve a TIA?

- A TIA must be approved by
- an officer of DOE who has been appointed by the President with the advice and consent of the Senate and
- who has been delegated the authority by the Secretary.
- DOE/NNSA Senior Procurement Executive must concur.

## Who may award a TIA?

- A DOE Contracting Officer if warrant specifically authorizes awarding of TIAs
- Certification standards:
- level III contracting certification,
- financial assistance certification, &
- completion of DOE TIA training.

## What must the CO consider before awarding a TIA?

- Nature of the project
- Type of recipient
- Recipients commitment and cost sharing
- Degree of Government involvement
- Benefits of using TIA

## Nature of Project

** **CO must:
- Determine that principal purpose is stimulation and support of RD&D (i.e., assistance) rather than acquisition
- Ensure to maximum extent practicable, project doesn’t duplicate other RD&D conducted by DOE
- should consult with program official

## Type of Recipient

- For profit firm must be involved in either:
- performance or
- commercial application of results
- TIAs particularly useful for awards to consortium that are not formally incorporated
- consortia potentially provide a self-governance mechanism.

##      Recipients Commitment & Cost Sharing

- To maximum extent practicable, non-Federal parties provide at least 50% of the resources
- CO must seek cost sharing
- If this amount of cost sharing is impractical, CO must determine whether other factors show recipient commitment to project success.

## Government Participation

- Government program officials must be substantially involved in the project
- similar to a standard cooperative agreement
- DOE program official should participate in quarterly reviews of the project
- May be involved in revisions of plans for future budget periods

## Benefits of Using a TIA

-  CO must answer questions at §603.225 concerning whether the use of a TIA will
- permit the involvement of commercial firms or business units that would not otherwise participate in the project;
- foster the creation of new relationships and collaborations among participants; or
- allow firms to use new business practices.

## Benefits - continued

- Use of TIA is expected to result in the development of energy technology that is
- - better,
- - more readily available, or
- - less expensive.
- Contracting Officer must explain benefits in Memorandum for Record

## What is an expenditure-based TIA?

-   Under an expenditure-based TIA
- Recipient receives amount expended on a project, less its cost sharing
-   analogous to a cost-type grant
- DOE recovers its share of the unexpended balance of funds if project is completed before all the funds are expended.

## What is a fixed support TIA?

- 	Under a fixed support TIA
- Agreement dollars are not meant to be adjusted at completion
- – recipient is responsible for the balance of costs needed to complete research project
- Analogous to a fixed-price contract

## What are the advantages of a fixed support TIA?

-    A fixed support TIA does not need to include:
- Minimum standards for financial management systems
- Cost principles or standards
- Audit requirements
- Minimum standards for purchasing system
- Requirements for financial reports

## When can I use a fixed support TIA?

- If the RD&D outcomes are well defined and verifiable;
- If CO can estimate resources needed to achieve outcomes well enough to ensure desired level of cost sharing; and
- If there is no mandatory amount of cost sharing required or amount can be waived.
- Must still seek at least 50% cost sharing.

## How are TIAs more flexible?

-    _Financial Management Systems:_ Recipients do not need to change existing systems as long as the systems:
- comply with Generally Accepted Accounting Principles;
- control and properly document all cash receipts and disbursements; and
- if advance payments are authorized, minimize time between payment by DOE and disbursement of funds.

## Flexibility - continued

- _Cost principles_:  If compliance requires change to cost accounting systems, TIA may specify that costs are allowable if:
- a reasonable and prudent person would incur such costs in carrying out the RD&D project
- costs are consistent with the purposes stated in the authorizations and appropriations
- _Audits_:  Periodic audits may be performed by participant’s IPA, rather than Federal agency

## Flexibility - continued

- _IP rights_: CO, with assistance of IP counsel, may
- Negotiate non-standard IP requirements
- – balance between Government’s and
-    recipient’s interests
- Allow more time for certain actions, (e.g., notifying DOE of an invention)
- Protect data from publication

## Flexibility - continued

-    _Payment methods:_  May use
- payable milestone method (preferred method) if payments are linked to pre-determined measures of observable, technical progress;
- reimbursement method; or
- advance payment method.

## Pre-Award Phase

- Award competitively to maximum extent feasible (statutory requirement)
- Use DOE FOA template if assistance is contemplated. May use template for BAAs
- FOA must state:
- TIAs may be awarded
- how cost sharing will be considered and if other demonstrations of a recipient’s commitment can be offered.

## Pre-award Evaluation

-    Contracting Officer must:
- Determine if recipient is qualified
- Determine if amount of award is reasonable
- Assess reasonableness of recipient’s cost-   sharing contribution
- Review collaboration agreement, if consortium
- Justify use of a fixed-support rather than an expenditure-based TIA, if contemplated
- Determine amounts for milestone payments, if  used

## Pre-award Evaluation – cont.

-  Cost sharing contributions are acceptable if they:
- Represent a real commitment to the project
- Are necessary and reasonable
- Can be charged to project per applicable cost standards or principles
- Are verifiable from recipient’s records
- Are not paid by government under another award unless authorized by Federal statute
- Are not costs of prior research

## How do you craft a good TIA?

- CO negotiates from DOE templates
- has considerable latitude to negotiate terms
- only deviations from 10 CFR Part 603 must be justified
- must review collaboration agreement and decide who signs, if consortium
- Must document file

## What are the IPAR requirements for TIAs?

- New award codes for TIAs
- “FT” - TIA that is a cooperative agreement
- “FO” - TIA that is an OT
- EPACT 2005 requires annual report to Congress on use of OT authority
- CO must complete 3 additional data fields in PADS for “FO” awards
- use responses in Memorandum for Record

## Post-award Phase

- Similar to other assistance awards
- Key Areas:
- Payments – review and track
- Project Management Review Meetings
- Financial Management – track total            expenditures
- Audits – coordinate and review
- Reports – track for timeliness and accuracy

## Judicious Use

- TIAs are a valuable new tool in the right place
- CO has a wide range of discretion in structuring an agreement to reduce barriers
- Must use judiciously
- balance benefits with added risks

## TIA Web Site

- 	_[http://professionals.pr.doe.gov/ma5/MA-5Web.nsf/FinancialAssistance/TechnologyInvestmentAgreements?OpenDocument](http://professionals.pr.doe.gov/ma5/MA-5Web.nsf/FinancialAssistance/TechnologyInvestmentAgreements?OpenDocument)__. _