DOD’s Prototype OTA Guide Offers Insight Into DOD’s Experiment In Regulation-Free Acquisition

Federal ProcurementIn January 2017, the Department of Defense issued updated guidance for acquisition officials entering into and managing what are known as other transaction agreements (OTAs) for prototyping projects. As a general rule, OTAs are not considered procurement contracts, grants or cooperative agreements, but something else; and they are not subject to the Federal Acquisition Regulation, the Competition in Contracting Act, the Truth in Negotiations Act, or a number of other onerous rules Congress and regulators have imposed on federal contracting over the years. This makes OTAs highly attractive to federal agencies and contractors, who alike have developed distaste for procurement-related red tape.

DOD’s new authority, as well as its Other Transactions Guide for Prototype Projects, significantly expands the breadth of acquisitions to which OTAs can be applied, raises the dollar value of OTAs that can be awarded, and opens up OTAs to small businesses. See DOD, Other Transactions Guide for Prototype Projects, Version 1.2.0 (January 2017) (Prototype OTA Guide or the Guide). These changes almost certainly will expand DOD’s pursuit of OTAs and commensurately raise new legal challenges to their use. This Feature Comment will explore these issues after first offering some background on the evolution of OTAs.

Click here to read the full article, originally published by The Government Contractor.