OTOTHER (Transaction)

What is OTOTHER (Transaction)?

OTOTHER (Transaction) refers to any Other Transaction (OT) agreement that is not a prototype OT agreement. It provides federal agencies with an alternative acquisition tool, outside of traditional Federal Acquisition Regulation (FAR)-based contracts, offering increased flexibility in structuring agreements and engaging with a broader range of contractors. This makes them particularly valuable for fostering innovation and quickly acquiring cutting-edge technologies.

Definition

An OTOTHER (Transaction) agreement is a type of contract vehicle authorized under 10 U.S.C. § 4022 (formerly 10 U.S.C. § 2371b), as well as similar authorities in other agencies (NASA, DHS, etc.). These agreements allow government agencies to bypass many of the standard regulations and requirements associated with traditional federal contracts, enabling more agile and adaptable procurement processes. OTOTHERs are often used when the government wants to encourage participation from non-traditional defense contractors, academic institutions, and innovative startups who might be deterred by the complexity and rigidity of the FAR. They are frequently employed for research and development, prototyping, and other activities where flexibility is paramount. Unlike Prototype OTs, Production OTs (sometimes referred to as OTOTHER) typically require follow-on authority or Congressional notification.

The legal basis for OTOTHER lies in statutes authorizing specific agencies to enter into these types of agreements. These statutes typically outline the conditions under which OTs can be used, including requirements related to cost-sharing, intellectual property rights, and the involvement of non-traditional contractors. For government contractors, understanding the nuances of these agreements is essential for successfully competing for and executing OTOTHER-based projects.

Key Points

• Flexibility: OTOTHER agreements offer greater flexibility in terms of contract terms, intellectual property rights, and reporting requirements compared to traditional FAR-based contracts.
• Attracting Non-Traditional Contractors: They are designed to encourage participation from companies that may not typically engage in government contracting, such as startups and academic institutions.
• Focus on Innovation: OTOTHERs are often used for projects that involve cutting-edge technologies and innovative solutions.
• Compliance: Although more flexible than FAR-based contracts, OTOTHER agreements still require careful attention to compliance with applicable laws, regulations, and agency policies.

Practical Examples

1. Developing a new cybersecurity solution: DARPA might use an OTOTHER agreement to collaborate with a small cybersecurity firm to develop a novel solution for protecting critical infrastructure. The agreement could specify flexible milestones and payment terms, allowing the firm to adapt its development approach as needed.
2. Prototyping a drone technology: The Army might use an OTOTHER agreement to prototype a new type of drone technology with a consortium of companies, including both traditional defense contractors and smaller drone manufacturers. The agreement would allow for shared intellectual property rights and collaborative development efforts.
3. Conducting advanced materials research: NASA might use an OTOTHER agreement with a university to conduct research on advanced materials for space exploration. The agreement could provide funding for graduate students and researchers, as well as access to NASA's facilities and expertise.