Breaking Down OTAs in Government Contracting

Other Transaction Authority (OTA), also referred to as Other Transactions (OTs), are procurement methods other than contracts, grants, or cooperative agreements. They allow flexible business arrangements to obtain research and development to support technology advancement or to quickly develop a prototype outside of the Federal Acquisition Regulations (FAR). In other words, OTAs are a way for small businesses to work with the government without dealing with red tape.

OTA Details

OTA prototype contracts can be up to $250 million in value and can be fixed-price, expenditure-based, or hybrid. Additionally, they:

  • Must use a nontraditional defense contractor,
  • Have all participants be small businesses,
  • Or, have at least a third of its total cost paid by parties other than the government.

Agencies must be authorized by Congress to use OTs and government Contracting Officers must have Agreement Officer authority to award OTs. The following federal agencies currently have Congressional authorization for OTs, but there are specific OT requirements, limitations, and restrictions for each agency:

  • National Aeronautics and Space Administration (NASA)
  • Department of Defense (DOD)
  • Department of Energy (DOE)
  • Human Health Services (HHS)
  • Department of Homeland Security (DHS)
  • Department of Transportation (DOT)
  • Federal Aviation Administration (FAA)
  • Transportation Security Administration (TSA)
  • Domestic Nuclear Detection Office (DNDO)
  • Advanced Research Projects Agency–Energy (ARPA-E)
  • National Institutes of Health (NIH)

Why OTAs?

OTAs have become a core element of the Department of Defense’s approach to technology and acquisition. DoD OTA obligations increased 75% in fiscal year 2019 and have increased 712% since fiscal year 2015. Why? Congress has been giving the Department of Defense OTAs to allow the Pentagon to take more risks in acquisition and fail before money is spent building a whole program.

Overall, OTAs are becoming more popular in government contracting and an increase in these opportunities could occur in the coming years.

Where can I find OTAs or Research and Development (R&D) opportunities?

The Defense Logistics Agency (DLA) R&D uses the Federal Contract Opportunities website at SAM.gov to post their opportunities using Broad Agency Announcements (BAA). More information on how to find these opportunities can be found on the DLA website.

Federal AI Efforts and NDAA 2021

On January 1, the National Defense Authorization Act (NDAA) of fiscal year 2021 (NDAA 2021) was passed. Among the information in NDAA 2021 were several legislative provisions that will shape the government’s approach to artificial intelligence (AI) over the next few years. Three of the key AI provisions in NDAA 2021 include the National Institute of Standards and Technology (NIST) establishing a voluntary risk management framework; the launching of the National Artificial Intelligence Initiative; and the Department of Defense (DoD) assessing its ability to acquire AI responsibly and ethically.

NIST Voluntary Risk Management Framework

NDAA 2021 directs NIST to establish a voluntary risk management framework for the use of AI and assessing the trustworthiness of AI systems. It also instructs NIST to define measurable standards within that framework. Finally, NDAA 2021 also expands NIST’s mission to include:

  • Advancing collaborative frameworks, standards, and guidelines for AI;
  • Supporting the development of a risk-mitigation framework for AI systems;
  • And supporting the development of technical standards and guidelines to promote trustworthy AI systems.

National Artificial Intelligence Initiative

NDAA 2021 called for the creation of a government-wide AI initiative to coordinate AI research and development. The framework for this includes a new National AI Initiative Office based in the White House, under which the new Interagency AI Committee and external National AI Advisory Committee will be based. This new framework will ensure the U.S. is a leader in the development and use of trustworthy AI systems.

Department of Defense & Acquiring AI Responsibly

Lastly, NDAA 2021 called for the Secretary of Defense to determine if the DoD has the ability and expertise to ensure AI technology acquired is ethically and responsibly developed. Additionally, it provided the DoD’s Joint Artificial Intelligence Center (JAIC) the authority to acquire AI technologies in support of defense missions.

Overall, NDAA 2021 laid out several provisions that will shape the government’s approach to AI over the next few years. AI technology has recently come into focus and the new efforts from NDAA 2021 show that it will continue to be an area of focus for the government. To learn more about government contracting opportunities, contact our team.