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Other Transaction 101

on August 20, 2018

Other Transaction Agreements get rid of many of the contractual hassles of FAR-based technology acquisitions

In our previous post, we explained how Other Transaction (OT) authority, an alternative to cumbersome Federal Acquisition Regulation (FAR)-based acquisitions, brings groundbreaking technologies to the government quickly and efficiently [Link]. Today, we’ll give you the need-to-know about this innovative acquisition model.

Unlike the FAR, Other Transaction Agreements (OTA) are designed to allow fast purchases of rapidly changing technologies, making them ideally suited for research and development work. In particular, OTAs address FAR challenges to R&D like these:

  • Expensive and inefficient FAR-based acquisition requirements because of poor communication between government and industry.
  • Inability to attract and engage technology providers of interest to the government
  • Intellectual property disputes
  • Limited technology transfer to practice
  • Cumbersome and slow contracting processes

There are two types of Other Transaction (OT) vehicles: the Other Transaction for Research – fundamental, applied, and/or advanced research and development; and the Other Transaction for Prototypes – critically needed prototype development from an expanded technology based.

Other Transactions are particularly effective when the government partners with an industry-based consortium.  In Other Transaction (OT) authority consortia, the government can be represented by a single “sponsor” (like a program executive office) or multiple sponsors coordinated through a lead agency. The consortium is made up of organizations with technology development skills in a specific area of interest, like:

  • For-profit companies, including small and nontraditional businesses;
  • Not-for-profit/nonprofit organizations; and
  • Academic research institutions.

These consortium partners are connected through a binding instrument called an Other Transaction Agreement (OTA).  OTAs lower the barriers to participation by innovative small businesses and nontraditional contractors.

On the whole, the OT consortium model creates…

  • True “enterprise partnerships” between government and an industry-academia consortium where collaboration and dialogue happen throughout the acquisition cycle;
  • Innovation through participation by “nontraditional” defense contractors (firms who have never before worked with the government); and
  • Better outcomes in less time without sacrificing competition at the project level.

Next time, we’ll give you an overview of Other Transaction Agreements that exist today, which cover technologies ranging from shipbuilding and ship repair to the electromagnetic spectrum, from to biomedical capabilities to and space, and from armaments to aviation.

Other Transaction 101

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