Innovative Contracting Training FAQ & Training

Consortia are industry groups that eliminate the need for a large number of agency staff to provide contracting services and operate similarly to hunting licenses, allowing for rapid transitions further insulated from protest.  About 60% of Department of Defense (DoD) spending on OTs is through consortia.

A consortium contract recipient (typically a contractor) manages the OT’s administrative requirements and serves as the general contractor.  For example, the managing firm ensures that non-traditional contractors or small business participants are engaged and negotiates terms and conditions through subcontracts. 

Companies (including non-traditional government contractors and academia representatives) form the consortium and are responsible for creating rules applicable to members.  For example, members execute a consortium agreement or articles of collaboration that govern interactions between members, which may include dues, the requirement to comply with the OTA’s terms and conditions, and attendance at consortium meetings. 

Agencies often issue orders to the consortium under a “master” OTA. The master OTA typically provides an estimated or ceiling value for the transaction, but this amount does not obligate the agency to spend the total amount.  The agency then issues orders through smaller agreements similar to task orders under an indefinite-delivery, indefinite-quantity (IDIQ) contract.  Funds for each order are provided separately using funds obligated for the master OTA. 

The sources provide a list of examples of consortia/collaborations, including:

• C5 Consortium (C4ISR and Cyber) 
• Countering Weapons of Mass Destruction Consortium
• National Armaments Consortium
• Aviation & Missile Technology Consortium
• National Advanced Mobility Consortium
• Defense Automotive Technologies Consortium
• Vertical Lift Consortium
• Training and Readiness Accelerator II Consortium
• Undersea Technology Innovation Consortium
• Naval Surface Technology & Innovation Consortium
• Maritime Sustainment Technology and Innovation Consortium
• Naval Energetic Systems and Technologies Consortium
• Naval Aviation Systems Consortium
• Expeditionary Missions Consortium–Crane
• DoD Ordnance Technology Consortium
• University Consortium for Applied Hypersonics
• American Metalcasting Consortium 
• Defense Electronics Consortium
• Defense Industrial Base Consortium 
• Advanced Manufacturing, Materials, and Processes
• Cybersecurity Manufacturing Innovation Institute
• Cornerstone
• System of Systems Consortium (SOSSEC)
• National Spectrum Consortium
• America’s DataHub Consortium (NSF)
• Strategic & Spectrum Advanced Resilient Trusted Systems
• Information Warfare Research Project
• Sensors, Communication, and Electronics Consortium
• Tradewinds
• Medical CBRN Defense Consortium 
• Medical Technology Enterprise Consortium
• Biopharmaceutical Manufacturing Preparation Consortium
• Rapid Response Partnership Vehicle 
• Customer Experience Hub
• Senior Healthcare Innovation Program
• CEED (Consortium for Energy, Environment and Demilitarization) 
• ConnectWerx
• Resilient Infrastructure + Secure Energy (RISE) Consortium
• Homeland Security Technology Consortium
• Space Enterprise Consortium

The Government Accountability Office (GAO) has ruled on the proper use of consortia. Additionally, contractors may need to enter into side agreements or three-party agreements to ensure recourse if an agency misuses proprietary information received under a consortium award.

An IDIQ contract (Indefinite Delivery, Indefinite Quantity) is a type of contract that provides a method to order from existing agency indefinite-delivery contracts, as well as contracts awarded by another agency. Examples of these contracts awarded by another agency are Government-wide Acquisition Contracts (GWACs) and Multi-Agency Contracts (MACs).

An IDIQ contract:

• Can be awarded to single or multiple vendors
• Is awarded using FAR Part 15 – Contracting by Negotiation procedures
• Should be considered before establishing a new agency specific IDIQ vehicle
• May be an appropriate business decision to support a portfolio of programs when recurring needs are anticipated

The ordering procedures for IDIQs are described at FAR Part 16.505 and DFARS Part 216.505.

The Small Business Innovation Research (SBIR) program is a competitive program that encourages small businesses to engage in Federal Research and Development (R&D) with the potential for commercialization.  The goal of the program is to stimulate innovation.  The Small Business Technology Transfer (STTR) program is a similar program that facilitates cooperative R&D between small businesses and non-profit U.S. research institutions. 

Federal agencies with R&D budgets exceeding $100 million are required to allocate a percentage of their R&D budget to these programs.  Participating agencies determine relevant R&D topics. 

The SBIR/STTR process has three phases:

• Phase I Concept Development: Explore the technical merit and feasibility of an idea or technology. Determine the quality of performance of the small business before providing further Federal support in Phase II.  Phase I contracts last no more than 6 months and are funded by the SBIR/STTR program.  Typically, Phase I awards are less than $150,000. 
• Phase II Prototype Development: Continue R&D efforts initiated in Phase I and evaluate commercialization potential.  Phase II contracts last no more than 24 months and are funded by the SBIR/STTR program.  Awards are typically less than $1 million.  Award amounts are based on Phase I results and scientific and technical merit for commercialization. 
• Phase III Commercialization: Work that derives from, extends, or completes R&D efforts under prior SBIR/STTR Phase I/II and enables a small business to pursue commercialization.  Phase III work may be for products (including test and evaluation), production contracts, and/or R&D activities.  There is no limit on the number, duration, type, or dollar value of Phase III awards.  Phase III awards cannot be funded by the SBIR program.  Agencies may enter into a Phase III SBIR contract, grant, or agreement at any time (competitively or non-competitively) with a Phase I or Phase II awardee. 

Although agencies primarily use procurement contracts, grants, or agreements in the SBIR program, the use of Prototype Other Transactions (OTs) is authorized. 

SBIR/STTR data rights protection applies to all phases and restricts the Government from disclosing SBIR data outside the Government.  The Government cannot compete with technologies containing SBIR data.  Sole source Phase III awards may not be appropriate in all cases if multiple sources exist in the open market for a similar product. 

A Cooperative Research and Development Agreement (CRADA) is an agreement authorized by 15 USC Section 3710a that allows federal labs to partner with other organizations to commercialize products or processes that originated in federal labs.

CRADAs are one of several R&D agreement strategies available to the DoD for partnering with other federal agencies, state and local governments, academia, industry, and non-profits.

Here are some key features of CRADAs:

• Intent: To license agreements for lab-developed inventions or intellectual property so that products or processes can be commercialized .
• Authorized Participants:Federal labs
• Other federal agencies
• State/local governments
• Industry
• Non-profits
• Universities
• Purpose:The labs may use a CRADA to seek an industry partner with the resources to market an invention or commercialize a technology.
• Non-federal or industry partners may seek a government lab to further develop unique resources.
• Restrictions: The research or development cannot duplicate research being conducted under an existing DoD program.
• Benefits:Enable industry and government to jointly research and develop technologies that have both commercial and military applications.
• Enable the government to acquire expertise without making monetary payments to the collaborating partner.
• Examples:A national lab may partner with a company to commercialize a computer technology developed by the lab.
• A government lab may partner with an industry partner to further develop a technology for use in a government system, such as Cray Computer Systems partnering with a warfare center to overcome challenges with operating systems.

CRADAs are a flexible agreement option for government labs to work with a variety of partners to develop and commercialize new technologies.

A Partnership Intermediary Agreement (PIA) is a contract, agreement, or memorandum of understanding with a non-profit partnership intermediary.  The PIA’s intent is to:

• Engage academia and industry on behalf of the government. 
• Accelerate technology transfer and licensing. 

There are some restrictions on PIAs:

• The partnership intermediary must be an agency of a state or local government, or a nonprofit entity. 
• This entity must be owned (in whole or in part), chartered, funded (in whole or in part), or operated (in whole or in part) by or on behalf of a state or local government. 
• The partnership intermediary must assist, counsel, advise, evaluate, or otherwise cooperate with small business firms and institutions of higher education.

PIAs are commonly used for technology transfer to the private sector.  They can increase the likelihood that government labs will conduct cooperative or joint activities with small business firms and institutions.

Here are some pros and cons of PIAs from the government perspective:

• PIAs enable the government to pay for services that support technology transfer. This is different from CRADAs, where the government cannot transfer funds. 
• PIAs allow partnership intermediaries to function as objective third-party brokers.
• These third-party intermediaries can engage in proactive marketing of lab technology. So a federal laboratory can have an organization market its technology commercially. 

However, PIAs:

• Are only available to government labs. 
• Can be complex to negotiate.

A Technology Investment Agreement (TIA) is an instrument used to stimulate or support commercial firm involvement in pursuing the best technologies for defense research. TIAs are appropriate when research objectives are unlikely to be achieved using other types of contract instruments.

TIAs may be executed as:

• A cooperative agreement
• A type of assistance transaction other than a grant or cooperative agreement, such as a Research Other Transaction (OT).

When the government does not intend to deviate from the Bayh-Dole Act, TIAs are executed as cooperative agreements in accordance with the DoD Grant and Agreement Regulations (DoDGARs).

The Bayh-Dole Act permits a university, small business, or non-profit institution to pursue ownership of an invention made using government-provided funds.

When the government seeks to retain intellectual property rights that deviate from the Bayh-Dole Act, Research OTs are used to execute TIAs.

DoD policy is to:

• Award TIAs using merit-based, competitive procedures, as described in 32 CFR Part 22.315, in every case where required by statute; and to the maximum extent practicable in all other cases.
• Judge that using a TIA could benefit defense research objectives in ways that likely would not happen if another type of assistance instrument were used (e.g., a cooperative agreement subject to all of the requirements of 32 CFR Part 34).

To the maximum extent practicable, the non-Federal parties carrying out a research project under a TIA are to provide at least half of the costs of the project. Obtaining cost-sharing, to the maximum extent practicable, is a statutory condition for any TIA under the authority of 10 USC Section 2371 and is a matter of DoD policy for all other TIAs.

A Funding Opportunity Announcement (FOA) is a document used by all federal agencies to announce the availability of grant (and cooperative agreement) funds to the public. www.grants.gov is the “beta.sam.gov of Grants and Cooperative Agreements.”

FOAs are about advancing a cause rather than buying a product or service. Grants and cooperative agreements are “a legal instrument of financial assistance between a Federal awarding agency or pass-through entity and a non-Federal entity.” A grant is funding or anything of value that is provided to advance a cause. Grants support critical recovery initiatives, innovative research, and other programs.

Here are some key points about the grant lifecycle:

• Pre-Award Phase (search opportunities, register & apply, and application review) The FOA provides all the information and requirements needed to assess eligibility and interest. Registration may take 1-3 weeks to complete. There may be several steps including DUNS, SAM.gov, and Grants.gov accounts. Help is available online for both registration and proposal development. Agency review involves: Initial screening to ensure application is complete, programmatic review and assessment of the substance of the applications, and financial review of proposed budgets.
• Award Phase: The agency awards the grant to the requesting organization. They go through a process to determine that they are making high quality, fair, and unbiased decisions.
• Post-Award: The grant is implemented and the rules of the grant are followed. Specific things are reported. If there are \$750,000 or more in federal awards during the fiscal year, there is a requirement for a single audit to be conducted that year. The grant is closed out within 90 days of finishing a grant activity . Necessary reports must be provided to the awarding agency after that award expires or is terminated.

FOAs have restrictions defined in the FOA itself, in the Grant and Cooperative Agreement, and in OMB Uniform Guidance Section 200.24 for cooperative agreements and Section 200.51 for grant agreements. FOAs are commonly used for the following:

• Ideas and projects to provide public services and stimulate the economy 
• Critical recovery initiatives
• Innovative research

Citizens and industry should consider exploring grants because there are many opportunities available. The grants.gov page has an electronic agent that will help guide users through the process.

A Broad Agency Announcement (BAA) is a document that federal agencies use to obtain proposals for basic and applied research and development to advance or evaluate cutting edge technologies. BAAs should be used when meaningful solutions are expected, and they are typically open, with proposals being accepted for a specified period of time (days to months to years). BAAs may or may not lead to contracts and may be used to award FAR-based contracts or non-FAR-based agreements.

Here are some additional details about BAAs:

• BAAs are not related to a specific system or hardware requirement.
• BAAs are typically used for the award of science and technology proposals for basic research (budget activity 6.1), applied research (budget activity 6.2), advanced technology development (budget activity 6.3), and advanced component development and prototypes (budget activity 6.4).
• They are often used to increase the government’s knowledge in strategic areas.
• They use a streamlined, merit-based evaluation process to select solutions.
• Industry can control proposal timing by choosing when to submit white papers or technical papers, though the government controls the timeline for proposal development once a white paper has been accepted.
• There are limitations on BAAs that may hinder the transition of technologies from BAAs into large acquisition programs.

Here are some common applications for BAAs:

• Research, Development & Demonstration (RD&D) collaboration and technology advancement efforts 
• Services to facilitate technology transfer to private sector
• Research & Development (R&D) studies
• Prototypes
• Small Business Innovation Research (SBIR) efforts
• Science & Technology (S&T) initiatives
• Technology maturation

BAAs are similar to Funding Opportunity Announcements (FOAs) which were discussed in our previous conversation. Both are focused on advancing causes, rather than procuring goods and services. BAAs are focused on advancing technologies, while FOAs have a broader scope.

You may want to do additional research on BAAs to learn more about the specifics of the process.