FAR/NOT FAR
them a need for “any special accounting capabilities,” he said. “Te government's acquisition processes and the DOD's cost- accounting system is not your normal accounting system and, therefore, orga- nizations [must] create whole new accounting systems in order to comply.” Tat bureaucracy is, he said, “one of the things that runs off organizations that are very innovative.” When they have a commercial market, they don't need to work under those conditions with the government.
OPTIMISTIC
After nearly three decades in government, Bob Tuohy, the chief operating officer emeritus of Advanced Technologies International—a consortium management firm—is bullish on the benefits that the consortium model brings to acquisition.
Tat's a problem. Unlike 50 or 60 years ago, the government is no longer fund- ing most of the research and development that’s happening in this country—these innovative technology firms often are. Other transactions and their minimized bureaucracy help make the government a more attractive client.
was expected to surpass $12 billion by the end of the 2021 fiscal year—are consor- tium based, according to the December 2020 report, “Department of Defense Other-Transaction Authority Trends: A New R&D Funding Paradigm?” from the Center for Strategic and International Studies.
THE CONSORTIUM KUMBAYA Other-transaction authority, which has existed in the shadows of defense acqui- sition since the late 1950s, enables DOD, for purposes of prototyping and rapid acquisition, to engage in agreements other than traditional contracts. In theory, any small or nontraditional defense contrac- tor could respond to a solicitation for this kind of agreement and win it. Most often, though, a consortium or consortium management company facilitates because it has the expertise in working with the government and has access to that work.
Bob Tuohy, the chief operating officer emeritus of Advanced Technologies Inter- national (ATI), a consortium management company that facilitates other-transaction agreements, said that other transactions “are contracts that don't fall within the normal procurement rules, so they call them agreements so that people don't get confused. In the commercial world, these would be contracts just like any other contract.”
Te defense acquisition system has unfor- tunate logical calisthenics built into it—legally mandatory but needlessly complex processes that are confusing, time-consuming and expensive. Tuohy, who worked for the government for nearly three decades, pointed to the government's cost-accounting standards.
Unlike traditional contractual transac- tions, other transactions don’t carry with
NEVERTHELESS, ISSUES PERSIST While other-transaction authority can speed up the acquisition of prototypes and bring nontraditional players into the fold, the Army uses vastly more than proto- types. Other-transaction efforts can only go so far, and the contracting personnel who write up the agreements don't always get it right. In fact, Tuohy said, there are few incentives for contracting personnel to be inventive or visionary. “Te FAR offers a lot of safety for these poor contracting officers who have to be very concerned about sticking their necks out,” he said.
Te DOD Inspector General released in April an audit of “a non-statistical sample of 13 base OT [other-transac- tion] awards, valued at $24.6 billion that were active in [fiscal years] 2018-2019.” While it didn't find evidence of waste, fraud or abuse, it did find some issues. Some of these were probably related to the relative newness of widespread use of
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Army AL&T Magazine Winter 2022
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