“For several years, agency acquisition shops have been getting more comfortable with buying outside of the Federal Acquisition Regulation. Both Defense and civilian agencies have been increasing their use of what are known as other transaction authorities. That revved up during the COVID pandemic spending. And it meant a few transparency problems. Federal Drive with Tom Temin heard more from Marie Mak, the director of Contracting and National Security Acquisitions Issues at the Government Accountability Office…”
“Tom Temin: So what did we discover? Give us the overview of OTA spending, I guess, especially by the National Institutes of Health — Health and Human Services — during the pandemic, and maybe it’s not over yet.
Marie Mak: When it comes to actual OTA pandemic spending, as of March 2021, we included three agencies — the Department of Defense, Health and Human Services, and Homeland Security. And with those three apartments, that were the ones that we could find that used OTAs, they obligated at least $12.5 billion using the OTAs. And this is significant, because when you look at prior year spending on OTAs, like for instance, in 2019, those three agencies only spent about $7.8 billion. When it comes to the overall picture, OTA spending represented about 23% of the total spending for those agencies within that timeframe. So it’s really from March 2020 to March 2021.
Tom Temin: So it was a good portion of the money that was not otherwise designated by Congress for direct payment to individuals? In other words, this is for the agency operations, and acquisitions of their own, aside from relief money.
Marie Mak: Well, OTA is worse spent on things that we needed in terms of vaccine awards and things like that. It’s not for internal use, it’s for external use. The main reason why they used OTAs instead of federal procurement, the main factors that agency official cited was speed in awarding these OTAs. They can expedite large vaccine development, manufacturing awards, because it streamlined the competitive process for evaluation and selection of awardees. And then there was another reason that agency official cited, was to engage with companies that may not have otherwise entered into a contract with the federal government, like non traditionals. For instance, like Pfizer, and Fitbit, those were thin contractors that may not have engaged with the federal government. And then the last benefit that agency cited was that it’s more flexible, and there’s a lot less administrative work. So essentially, OTAs are not subject, like you mentioned, to the Federal Acquisition Regulations. And they enabled agencies and companies to start with a blank sheet of paper to negotiate contractual terms and conditions…” Read the full interview here.
Source: Increased OTA use from COVID contract boom caused transparency issues, watchdog agency says – By Tom Temin, August 6, 2021. Federal News Network.
