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Contract Type Matrix

Research OTs (10 USC §4021)

 

Research OTs are appropriate for basic, applied, and advanced research projects related to weapons systems or other military needs. Research OTs may be used to pursue research and development of technology with dual-use application (commercial and government). Unlike Prototype OTs, Research OTs do not include authority for transition to follow-on production contracts or transactions.

Research OTs should include a cost sharing arrangement that, to the maximum extent practicable, do not require funds provided by the government to exceed funds provided by other parties. There is latitude for the final share ratio to be other than 50/50 based on considerations such as the party’s resources, prior investments in the technology, commercial vs. military relevant, unusual performance risk, and nature of the project.

Although CICA is not applicable, competition should be pursued to the maximum extent practicable to incentivize high quality and competitive pricing.

Research OTs are also used to execute Technology Investment Agreements (TIAs) when the government seeks to retain intellectual property rights that deviate from the Bayh-Dole Act (35 U.S.C. Chapter 18  and 37 CFR Part 401) which permits a university, small business, or non-profit institution to pursue ownership of an invention made using government provided funds.

 

Common Applications

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

 

Pros

Cons
Attributes of an OT can enable faster development and potential fielding of capability Pursuit and execution of an OT requires highly experienced and empowered staff; lack of guidance, structure, and processes can challenge and intimidate inexperienced staff
Reduces barriers to entry for non-traditional vendors; allows greater government access to commercial innovators that do not typically do business with the government Government assumes increased risks without the process, precedent, and protection of the FAR
Standard cost accounting requirements are not required under an OT, enabling greater access to commercial innovators that previously did not want to share cost data with the government Flexible arrangements in intellectual property and cost accounting data can have long-term negative implications for the government
OTs offer flexible approach to managing intellectual property, enabling greater access to commercial innovators that do not comply with traditional government data rights
Agencies that have been designed with OT authority have options for OT implementation to include Commercial Solution Opening pilot program, use of existing consortia OTs, or the development of a unique internal OT
OTs are not subject to traditional GAO protests, unless the application of an OT is challenged to be inappropriate (they can be challenged in the court of federal claims)

Restrictions

  • FAR/DFARS are not applicable
  • 50/50 cost share arrangement to maximum extent practicable
  • Agencies must be explicitly authorized by Congress to use OTs
  • Contracting Officer must have Agreement Officer authority to execute

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