Rapid Acquisition References

DoD will develop a culture of rapid and meaningful innovation, streamline requirements and acquisition processes, and promote responsible risk-taking and personal initiative.

Jim Mattis

Secretary of Defense

Rapid Acquisition Organizations

Strategic Capabilities Office (SCO) – Then DEPSECDEF Carter created the SCO in 2012 to help DoD re-imagine existing DOD, IC and commercial systems by giving them new roles and game-changing, classified capabilities to confound potential enemies — the emphasis here was on rapidity of fielding, not 10 and 15-year programs. Getting stuff in the field quickly. $470M budget in FY16. Dr. William Roper is the Director

Air Force Rapid Capabilities Office (RCO) – expedites development and fielding of select DoD combat support and weapon systems by leveraging defense-wide technology development efforts and existing operational capabilities.

Air Force Big Safari Program has successfully employed a rapid acquisition approach to meet the need for accelerated acquisition, tailored according to the product being acquired. This approach is enabled by a culture of urgency, trust, decentralized decision authority, and the wide use of more flexible contracting approaches. The results were rapid modification and integration of commercial sensor systems onto Air Force strategic intelligence collection platforms.

Army Rapid Capabilities Office is the Army’s signature initiative to expedite critical technologies to the field to counter urgent and emerging threats. As a key piece of Army acquisition reform efforts, the new office will conduct rapid materiel development and delivery to address immediate, near-term and mid-term combatant commanders’ needs. Beyond closing current capability gaps, the organization also aims to stimulate aggressive, proactive capability development and leverage disruptive technologies to meet Army strategic objectives.

Maritime Accelerated Capabilities Office (MACO), based on the Air Force’s Rapid Capabilities Office, which will create a “speed lane” for mature programs that can be fielded with less risk. MACO would oversee these programs from cradle to grave and include the necessary requirements, acquisition, fleet and legal representatives needed to rapidly field these mature systems.

Army’s Rapid Equipping Force (REF) harnesses current and emerging technologies to provide immediate solutions to the urgent challenges of U.S. Army forces deployed globally. Vision: To remain the Army’s quick response capability for urgent non-standard equipment. In partnership with Soldiers worldwide, REF identifies emerging capability gaps; provides solutions within a timeframe relevant to current operations; and shares information with stakeholders to inform and accelerate the deliberate capability development and acquisition processes.

Army Network Integration Evaluations (NIEs) series of Soldier-led evaluations designed to further integrate and rapidly progress the Army’s tactical communications network, which is a top Army modernization priority.

USSOCOM SOFTWERX is a 10,000 square-foot open floor building with the look and feel of a tech startup. The name is a melding of SOF and a stylized spelling of “Works.” SOCOM decided it needed to do something in response to growing concerns that the military has been a technology laggard and needs to create new channels to communicate with the faster-moving private sector. Video of Event

Digital Defense Office brings coders in for a tour of duty. Led by Chris Lynch. The DDS will be a small team of engineers and data experts meant to “improve the Department’s technological agility and solve its most complex IT problems.

Joint Improvised-Threat Defeat Organization (JIDO) will enable DoD actions to counter improvised threats with tactical responsiveness and through anticipatory, rapid acquisition in support of Combatant Commands’ efforts to prepare for, and adapt to, battlefield surprise in support of counter-terrorism, counter-insurgency, and other related mission areas including counter-improvised explosive device.

Defense Innovation Marketplace

The Defense Innovation Marketplace is a communications resource to provide industry with improved insight into the Research and Engineering investment priorities of the DoD. The Marketplace contains DoD R&E strategic documents, solicitations, and News/Events to better inform Independent Research and Development (IR&D) planning. The website includes: New Business Opportunities, Technical Interchange Meetings, Defense Innovation Initiative, Strategic Direction, Small Business Resources, and News & Events.

R&D Organizations
  • DARPA For more than fifty years, DARPA has held to a singular and enduring mission: to make pivotal investments in breakthrough technologies for national security.
  • DASD EC&P The Rapid Reaction Technology Office (RRTO) has two lanes of activities. The first lane of activities is the Rapid and Quick Reaction Funds focused on providing a hedge against technology risks and accelerating warfare capabilities, respectively. Additionally, they have an emerging technology development aimed at countering the emerging threats. The second lane of activities in this office is called the Innovation Outreach. The objective of the Innovation Outreach is to identify innovative ideas and matched them with DoD needs. Another innovation venue is JCTDs. The JCTD Program executes operational prototypes to address the most pressing technology gaps facing the Department of Defense. Starting in FY15 JCTD, projects primarily be initiated to develop technology solutions in the four EC&P focus areas, namely, Space capability resilience, Autonomous systems, Electromagnetic spectrum agility, and Asymmetric force application
  • DASD Research -Oversight of the 17 S&T Communities of Interest for DoD. The COI Identifies the current DoD investments, gaps and challenges. The MITRE thought leaders supporting each of the COIs can the mediums for transitioning our innovations as well as being the innovation bridge. The value of the COI activity is identifying the areas DoD is already investing in, and the gaps and challenges they are trying to achieve. Industry can then identify where they can accelerate the goals of DoD or fill the gap areas for a particular COI/Service. The COI provides the S&T investment roadmap but industry partners need to engage with the services who control the funding. Small seedling efforts are funded directly to COIs but very limited amount, 5 seedlings at $500K across the $12B – DoD S&T investment. COIs regularly request industry engagement through FEDBIZOPs
  • Rapid Innovation Fund (RIF) – Provides a collaborative vehicle for small businesses to provide the department with innovative technologies that can be rapidly inserted into acquisition programs that meet specific defense needs. RIF is administered by the ASD R&E and Office of Small Business Programs (OSBP).
  • Reliance 21 – The overarching framework for DoD’s S&T joint planning and coordination process. The goal of Reliance 21 is to ensure that the DoD S&T community provides solutions and advice to the DoD’s senior level decision makers, warfighters, Congress, and other stakeholders in the most effective and efficient manner possible. This is achieved through an ecosystem and infrastructure that enables information sharing, alignment of effort, coordination of priorities, and support for scientists and engineers across the DoD. Reliance 21 Operating Principles  17 Communities of Interest
  • Federally Funded Research and Development Centers (FFRDCs) – Private-sector resources, operating in the public interest. They perform work closely associated with inherently governmental functions and assist the government with its long-term research or development needs. FFRDCs enjoy a special relationship with their government sponsors, marked by special access to government data and resources. In exchange, FFRDCs must be free of organizational conflicts of interest and cannot compete for work, except for the right to operate an FFRDC. A FFRDC primer from The MITRE Corporation.
  • University Aligned Research Centers (UARCs) – strategic DoD research centers associated with a university. UARCs are formally established by the Director of Defense Research and Engineering (DDR&E). UARCs were developed to ensure that essential engineering and technology capabilities of particular importance to the DoD are maintained. Although UARCs receive sole source funding under the authority of 10 U.S.C. Section 2304(c)(3)(B), they may also compete for science and technology work unless precluded from doing so by their DoD UARC contracts.
Industry Outreach Organizations

Defense Innovation Unit Experimental (DIUx) Located in Mountain View, CA, the DIUx will position the DoD to be more open to the infusion of non-traditional technical ideas and talent. The initiative is designed to create a hub for increased communication with, knowledge of, and access to innovating, high-tech start-up companies and entrepreneurs and their leading edge technologies. The mission of DIUx is to: Strengthen existing relationships and build new ones; Scout for breakthrough and emerging technologies; and serve as a local point of presence for the Department. Articles on DoD Partnership with Silicon Valley

Massachusetts Innovation Bridge connects local businesses, non-profits, and academic institutions with federal opportunities. Through opportunity identification and matching, technical exchanges, educational resources, networking events, and ongoing support, MIB helps you make the most of every opportunity.

Air Force Research Laboratory (AFRL) Small Business Hub has nearly 450 members, held 70 collider events and 210 one-on-one meetings to assist businesses and link them with AFRL.

Technology Domain Awareness (TDA) the effective understanding of the technology landscape as it relates to defense needs. It is a defense innovation business process based on shared technology information and related operational concepts and lessons learned to support better technology decision making. Information Analysis Center TDA is building an expanded defense technology innovation community of practice that incorporates DOD stakeholders, traditional defense industry, the start-up and venture capital communities, and the academic research community. It employs a combination of incentives, information, shared infrastructure, and services to:

  • Facilitate the rapid identification of defense-relevant technology opportunities and challenges,
  • Enable collaborative development and prototyping activities,
  • Develop a learning context for defense technology innovation and
  • Link and scale distributed innovation efforts to enhance transition and address DOD-wide learning objectives

See also Innovation Warfare: TDA and America’s Military Edge, War on the Rocks, Oct 2014

Other Transaction Authority (OTA)

What is an “Other Transaction?” 

A flexible business arrangement with a non-traditional supplier to quickly develop a prototype system with significantly less administrative overhead.

Other Transitions (OTs) (sometimes referred to as Other Transaction Authority (OTA)) provide flexibility that allows for much greater speed, flexibility, and accessibility for research and prototyping activities than permitted under statutes and regulations that apply to traditional Federal Acquisition Regulation (FAR) contract instruments. Although OTs are not subject to the FAR, these arrangements provide suitable guardrails and formalized procedures to ensure fairness, transparency, and appropriate controls.

OTs are a mechanism to access innovative research and development from non-traditional vendors. Section 815 of the FY 2016 NDAA defines a non-traditional defense contractor as an entity that is not currently performing and has not performed, for at least the one-year period preceding the solicitation of sources by the DoD for the procurement or transaction, any contract or subcontract for the DoD that is subject to the full coverage under the cost accounting standards prescribed pursuant to Section 1502 of title 41 and the regulations implementing such section. who are challenged by the standard requirements of traditional contracts, grants, or cooperative research and development agreements. The White House Office of Science & Technology Policy (OSTP) stated in a 2014 publication that “OTs allow agencies and their contracting partners to enter into flexible arrangements tailored to the particular projects and needs of the participants.

OTs are best suited:

  • For RD&D activities to advance new technologies and processes and prototyping or models to evaluate feasibility or utility of a technology
  • To address perceived obstacles to doing business with the government by non-traditional vendors to include intellectual property rights and compliance with cost accounting standards
  • For flexibility to tailor agreements to reach non-traditional vendors with innovation research development and demonstration (RD&D) solutions
  • For negotiable funding arrangements, payment milestones, and length of agreement to achieve research and prototype projects

Why Use An OT?

An OT is a transaction (other than a contract, grant, or cooperative agreement) to which most of the laws and regulations governing federal contracts – including the FAR – do not apply.” – DIUx guide

  • Deliver capability faster
  • Reduce administrative overhead and bureaucratic delay
  • Simplify the contracting procedures
  • Reduce barriers to entry for non-traditional vendors
  • Negotiable funding arrangements and payment milestones
  • Provide a flexible approach to managing intellectual property
  • Establish a streamlined path to a full production contract

OT Limitations

While OTs provide significant flexibility, there are also some limitations. OTs are exempt from FAR and are not required to follow a standard format or include standard terms and conditions, but Agencies must be explicitly authorized by Congress to use them. Eleven federal agencies currently have Congressional authorization for OTs:

Agency OTA Authority Agency Specific OTA Requirements, Limitations, and Restrictions
NASA 51 U.S.C. § 20113(e) No limitations or restrictions.
DOD 10 U.S.C. § 2371 Authorized for prototype projects directly relevant to enhancing mission effectiveness of military personnel and the supporting platforms, systems, components, or materials in use by the Armed Services.

Meet one of the following conditions:

  • At least one non-traditional defense contractor participating to a significant extent
  • All significant participants in the transaction other than the Fed Gov are small businesses OR non-traditional defense contractors
  • At least 1/3 of total cost of prototype project paid out of funds provided by parties to the transaction other than the Fed Gov

The agency senior procurement executive determines that exceptional circumstances justify use of a transaction not feasible or appropriate under a contract or provides opportunity to expand the defense supply base in a manner not practical or feasible under a contract

DOE 42 U.S.C. § 7256 Limited to RD&D projects. Cost sharing agreement required.
HHS 42 U.S.C. § 247-7e Limited to RD&D projects. Cost sharing agreement required.
DHS 6 U.S.C. § 391 Authorized for RD&D and prototype projects.

Prototype projects require a non-traditional contractor and cost sharing agreement.

DOT 49 U.S.C. § 5312 Limited to RD&D focused on public transportation.
FAA 49 U.S.C. § 106(l) No limitations or restrictions.
TSA 49 U.S.C. § 114(m) No limitations or restrictions.
DNDO 6 U.S.C. § 596 No limitations or restrictions.
ARPA-E 42 U.S.C. § 16538 No limitations or restrictions.
NIH 42 U.S.C. § 285b-3; 42 U.S.C. § 284n; 42 U.S.C. § 287a Limitations and restrictions differ based on specific research programs.

Additional OSD approvals and references per DPAP OTA Guide

Prototype Project Cost (Including Options) Non-delegable Approval Authority for Military Departments/ Defense Agencies with OT Authority Approval Authority Source
Over $50 Million and Up to $250 Million Senior Procurement Executives (SPE) of the Military Departments – the Service Acquisition Executives (SAEs) for Army, Navy and Air Force Senior Procurement Executive for the Fourth Estate – USD(AT&L) Director of DARPA Director of the Missile Defense Agency (MDA) 10 U.S.C. §2371b(a)(2)(A)
Over $250 Million USD(AT&L) 10 U.S.C. §2371b(a)(2)(B)(1)

[1] Section 815 of the FY 2016 NDAA defines a non-traditional defense contractor as an entity that is not currently performing and has not performed, for at least the one-year period preceding the solicitation of sources by the DoD for the procurement or transaction, any contract or subcontract for the DoD that is subject to the full coverage under the cost accounting standards prescribed pursuant to Section 1502 of title 41 and the regulations implementing such section.

[2] Section 815 of the FY 2016 NDAA replaced section 845 of the FY 1994 NDAA (repealed) and provided DoD with permanent authority for prototypes, as well as increased dollar threshold approval levels for prototype projects, amended criterion for OTA eligibility, and allows a prototype project to transition to award of a follow-on production contract.

Another restriction is that OTs can only deliver limited quantities of prototypes rather than full-scale production arrangements. The term prototype is not fully defined in federal law, so most agencies have relatively broad, flexible definitions of the term. The DIUx guide defines it as “A prototype project can generally be described as a preliminary pilot, test, evaluation, or agile development activity used to test the viability, technical feasibility, or military utility of a technology, process, concept, end item, system, methodology, or other discrete feature.”

However, if an OT is used in combination with a prototype and/or minimum viable product (MVP) that has been demonstrated and the “military utility” confirmed, the OT mechanism allows a program office to directly award a full production contract to the vendor, without having to recompete the work. This is an important benefit of the OT approach.  Section 815 of the FY2016 NDAA specifically allows follow-on production contracts resulting from an OT, limited to the participants in the OT prototype project. This may be done without the use of competitive procedures if the following criteria are satisfied:

  1. Competitive procedures were used to select the parties to participate in the prototype project; and
  2. The participants in the transaction successfully completed the prototype project provided for in the transaction

To take advantage of this authorization, programs should develop acquisition approaches for prototype projects that address anticipated follow-on activities.

How To Use An OT

The options for an OT fall into two basic categories: use an external organization’s OT vehicle, or establish an internal OT vehicle.

External OT Vehicle

DIUx established a mechanism called a Commercial Solutions Opening (CSO) to solicit solutions to warfighter needs under an OT. The CSO mechanism is available for any DoD entity to use, and the process begins by visiting the Work With Us page on the DIUx website. A detailed explanation of the process is provided in the CSO How To guide quoted on the first page of this document. One benefit of the DIUx CSO is the wide scope of technology that can be developed using this vehicle. However, the color of money is limited to R&D funds. For examples of current projects being supported by this mechanism, download the latest DIUx Quarterly Report. According to this report, “as of March 2017, DIUx has awarded 25 agreements for a total of $48.4M.”

The Air Force Research Laboratory site in Rome, NY, runs an OT vehicle similar to DIUx’s and has run 20+ projects. This vehicle is managed by an entity named the System of Systems Consortium. AFRL published a 10 Step Guide which walks the reader through the process of using their OT. The AFRL approach is slightly faster than DIUx because rather than issuing an entirely new OT for each customer (as DIUx does), AFRL simply issues a Task Order under their existing OT.

In addition to DIUx and AFRL, there are a growing number of consortia to help agencies draw innovators who were not traditional federal contractors, as well as companies with long government service, to tackle tough, intractable challenges.

Consortium Sponsor Management Firm
Defense Automotive Technologies Consortium (DATC) U.S. Army Tank Automotive Research, Development and Engineering Center (TARDEC) SAE Industry Technologies Consortia
National Spectrum Consortium (NSC)  Defense Department Advanced Technology International a subsidiary of ANSER Corp. (ATI)
Medical Technologies Enterprise Consortium (MTEC) U.S. Army Medical Research and Materiel Command (USAMRMC) ATI
DoD Ordnance Technology Consortium (DOTC) Under Secretary of Defense for Acquisition, Technology and Logistics ATI
Border Security Technology Consortium (BSTC) Homeland Security Department Customs and Border Patrol ATI
Vertical Lift Consortium (VLC) Under Secretary of Defense (Acquisition, Technology and Logistics) ATI
Medical CBRN Defense Consortium (MCDC)  Defense Department  Joint Program Executive Office for Chemical and Biological Defense (JPEO-CBD) ATI
National Shipbuilding Research Program (NSRP) NAVSEA ATI
System of Systems Enterprise Consortium (SOSSEC) Army Research, Development and Engineering Center (ARDEC) SOSSEC Inc.
Open Systems Architecture Initiative (OSAI) Air Force research Laboratory SOSSEC Inc.
Consortium for Energy, Environment and Demilitarization (CEED) Army Research, Development and Engineering Center (ARDEC) Consortium Management Group (CMG)
Consortium for Command, Control, and Communications in Cyberspace (C5) Army Research, Development and Engineering Center (ARDEC) Consortium Management Group (CMG)
National Advanced Mobility Consortium (NAMC) Under Secretary of Defense for Acquisition, Technology and Logistics National Center for Manufacturing Sciences
Sensors, Communications and Electronics Consortium (SCEC) Army-Aberdeen Proving Ground Bids under evaluation
Space Enterprise Consortium Air Force Space and Missile Systems Center, Advanced Systems and Development Directorate Bids under evaluation
Modeling and Simulation Consortium Army Program Executive Office for Simulation, Training and Instrumentation (PEO STRI) Pre-solicitation

Internal OT Vehicle

A program office could establish it’s own OT vehicle, following a consortium model. This is the most flexible approach in terms of technical scope and also takes the longest (potentially 6 months). For further guidance about how to do this, refer to the OSTP Innovative Contracting Case Studies guide) or the Jan 2017 Other Transaction Guide, published by the Director of Defense Procurement and Acquisition Policy. Under current policy, a Senior Procurement Executive has authority to approve an OT up to $250M. Note that personnel at DIUx and AFRL alike have publicly expressed a willingness to help government entities develop their own OT’s. DIUx in particular has a strong emphasis on scaling the OT practice by “sharing guidance… with organizations across the DoD.”

Questions To Ask

  • Does my organization currently have Congressional authorization for OTs?
  • What is the timeline for using an OT mechanism? How soon can the program office begin and how well does the OT timeline align with existing schedule plans?
  • How will the funding arrangements work (timing, amounts, color of money, etc.)? When are funds available?
  • Will the organization’s approval authorities grant permission to use an OT? What additional information is necessary to gain their approval?
  • Do our contracting officers have experience with OTs?

While using an OT is not exactly unchartered territory, the number of relevant precedents is admittedly limited. There is thus a certain amount of unpredictability inherent in this option. However, the number of OTs currently in use is increasing and the community of acquisition professionals who are familiar with OTs continues to expand. This risk should be assessed in comparison with the risk of using standard procedures.

References

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