Source: https://aida.mitre.org/ota/
Timestamp: 2019-04-19 13:08:28+00:00

Document:
Other Transactions (OTs) are procurement instruments other than contracts, grants, or cooperative agreements enabling flexible business arrangements to acquire research and development to support technology advancement or to quickly develop a prototype. Most laws and regulations governing federal contracts do not apply to OTs (i.e., Federal Acquisition Regulation (FAR) and the Competition in Contracting Act (CICA)), however, the Procurement Integrity Act applies and competitive practices are applicable. OTs may be protested to the U.S. Court of Federal Claims, and GAO has limited jurisdiction to review OT decisions.
OTs are a mechanism to access innovative research and development from non-traditional contractors who are challenged by the standard requirements of traditional contracts, grants, or cooperative research and development agreements. OTs can be used with traditional contractors when statutory requirements are met. OTs provide flexibility that allows for increased speed, flexibility, and accessibility for research and prototyping activities than permitted under statutes and regulations that apply to traditional FAR based contracts. OT agreements may be fixed-price, expenditure based, or hybrid.
48 CFR §212.001 defines a non-traditional defense contractor as an entity that is not currently performing and has not performed, for at least the one-year period preceding the solicitation of sources by the Department of Defense (DoD) for the procurement or transaction, any contract or subcontract for the DoD that is subject to the full coverage under the cost accounting standards prescribed pursuant to 41 USC §1502 and the regulations implementing such section.
The White House Office of Science & Technology Policy (OSTP) stated in a 2014 publication that “OTs allow agencies and their contracting partners to enter into flexible arrangements tailored to the particular projects and needs of the participants.” Section 867 of the FY18 NDAA requires the Secretary of Defense to establish preference for use of OTs and experimental authority in execution of S&T and prototype programs.
Although OTs may be appealing due to perceived speed to award OT agreements, the primary goal of OTs is to encourage/engage non-traditional performers to support government needs, NOT to award agreements quickly or avoid FAR competitive processes.
NASA 51 U.S.C. § 20113(e) No limitations or restrictions.
DOD 10 U.S.C. § 2371 Authorizes Research OTs and Prototype OTs. See DoD Other Transactions for detailed requirements, limitations, and restrictions.
DOE 42 U.S.C. § 7256 Limited to RD&D projects. Cost sharing agreement required.
Authorized for RD&D and prototype projects.
HHS 42 U.S.C. § 247-7e Limited to RD&D projects. Cost sharing agreement required.
DHS 6 U.S.C. § 391 Prototype projects require a non-traditional contractor and cost sharing agreement.
DOT 49 U.S.C. § 5312 Limited to RD&D focused on public transportation.
FAA 49 U.S.C. § 106(l) No limitations or restrictions.
TSA 49 U.S.C. § 114(m) No limitations or restrictions.
DNDO 6 U.S.C. § 596 No limitations or restrictions.
ARPA-E 42 U.S.C. § 16538 No limitations or restrictions.
NIH 42 U.S.C. § 285b-3 Limitations and restrictions differ based on specific research programs.
 Section 815 of the FY 2016 NDAA defines a non-traditional defense contractor as an entity that is not currently performing and has not performed, for at least the one-year period preceding the solicitation of sources by the DoD for the procurement or transaction, any contract or subcontract for the DoD that is subject to the full coverage under the cost accounting standards prescribed pursuant to Section 1502 of title 41 and the regulations implementing such section.
 Section 815 of the FY 2016 NDAA replaced section 845 of the FY 1994 NDAA (repealed) and provided DoD with permanent authority for prototypes, as well as increased dollar threshold approval levels for prototype projects, amended criterion for OTA eligibility, and allows a prototype project to transition to award of a follow-on production contract.
Two types of Other Transaction Authority are available to the Department of Defense (DoD). The revised USD A&S Other Transactions Guide provides conditions for use as well as guidance for planning and executing Research and Prototype OTs as well as follow-on Production OTs.
Research OTs (10 U.S.C. §2371) are applicable for basic, applied, and advanced research projects to pursue development and application of dual-use technology. Unlike Prototype OTs, Research OTs do not include authority for transition to follow-on production contracts or transactions.
Research OTs require cost sharing arrangements between the government and the other party/parties, typically split 50/50, although the ratio is negotiable based on resources, previous technological investments, commercial vs. government applicability, performance risk, and nature of a project. Although the Competition in Contracting Act (CICA) is not applicable, competition should be pursued to the maximum extent practicable to incentivize high quality and competitive pricing.
Prototype OTs (10 U.S.C. §2371b) are appropriate for research and development and prototyping activities to enhance mission effectiveness of military personnel and supporting platforms, systems, components, or materials. Prototype OTs may only be used to develop limited quantities of prototypes, however, they can provide a path to directly award a follow-on production OT or contract without having to recompete the effort. This is an important benefit of the Prototype OT approach, but programs must develop acquisition approaches for prototype projects that address anticipated follow-on activities to properly take advantage of this authorization.
A program office could establish its own OT vehicle, following a consortium model. This is the most flexible approach in terms of technical scope, but also may take longer than leveraging an established OT through a consortium (potentially 6 months or more). For further guidance about how to do this, refer to the OSTP Innovative Contracting Case Studies guide or the Dec 2018 OUSD A&S Other Transactions Guide.
Does my organization currently have Congressional authorization for OTs?
What is the timeline for using an OT mechanism? How soon can the program office begin and how well does the OT timeline align with existing schedule plans?
How will the funding arrangements work (timing, amounts, color of money, etc.)? When are funds available?
Will the organization’s approval authorities grant permission to use an OT? What additional information is necessary to gain their approval?
Do our contracting officers have experience with OTs?
While using an OT is not exactly unchartered territory, the number of relevant precedents is admittedly limited. There is thus a certain amount of unpredictability inherent in this option. However, the number of OTs currently in use is increasing and the community of acquisition professionals who are familiar with OTs continues to expand. This risk should be assessed in comparison with the risk of using standard procedures.
SEC. 873. DATA, POLICY, AND REPORTING ON THE USE OF OTHER TRANSACTIONS.
(a) COLLECTION AND STORAGE.—The Service Acquisition Executives of the military departments shall collect data on the use of other transactions by their respective departments, and the Under Secretary of Defense for Research and Engineering and the Under Secretary of Defense for Acquisition and Sustainment shall collect data on all other use by the Department of Defense of other transactions, including use by the Defense Agencies. The data shall be stored in a manner that allows the Assistant Secretary of Defense for Acquisition and other appropriate officials access at any time.
(b) USE OF DATA.—The Assistant Secretary of Defense for Acquisition shall analyze and leverage the data collected under subsection (a) to update policy and guidance related to the use of other transactions.
(2) highlights of successes and challenges using the authority, including case examples.
Latest policy and guide available….I can’t upload to site. Please email me to receive.
Hi Jan, new policy and guide added today. Thank you!

References: §212
 §1502
 § 20113
 § 2371
 § 7256
 § 247
 § 391
 § 5312
 § 106
 § 114
 § 596
 § 16538
 § 285
 §2371
 §2371