This week the Office of the Under Secretary of Defense for Acquisition and Sustainment (USD (A&S)) rescinded the January 2017 version of the Other Transactions (OT) Guide for Prototype Projects and issued a OT agreements (OTAs) are not Federal Acquisition Regulation (FAR)-based procurement contracts, grants, or cooperative agreements. As enunciated under the new OT Guide, OTAs are intended to utilize more commercial arrangements to accomplish particular projects. While OTAs are subject to certain laws and provisions, they are not required to comply with the full panoply of procurement laws and regulations, such as the FAR and agency-specific supplemental acquisition regulations, applicable to FAR-based contracts.
Statutory authority for OTAs traditionally has been used to allow Department of Defense (DoD) to enter into agreements for new research, prototype development, and limited production. This also includes Technology Investment Agreements (TIAs). Revision of statutory authority has expanded the definition of non-traditional defense contractor (NTDC) and the use of OTAs to permit appropriate follow-on production agreements. DoD uses OTAs to access state-of-the-art technology solutions from traditional defense contractors, non-traditional defense contractors that do not typically engage in contracts with the federal government, consortia, or through teaming arrangements involving these or other types of entities.
The OT Guide provides a useful compendium of information on OTA authority, processes, administration and resources. It includes a set of definitions, mythbusters, authorities, as well as examples of OTA arrangements, to clarify for both Government and industry the nature and scope of OTAs.
Takeaways:
Susan Warshaw Ebner , one of FortneyScott’s shareholders, has experience in OTAs and TIAs, as well as traditional FAR-based procurements, grants and cooperative agreements. If you have questions about this advisory, or seek assistance with regard to these types of transactions, please contact Susan Warshaw Ebner or your FortneyScott counsel.
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