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 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)
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.