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    A civilian agency would like to engage 3 - 5 vendors to build prototypes for a solution. That solution can be considered a commercial item. A number of small disadvantaged businesses should have the capabilities to perform the work. After the prototypes are built and evaluated, the agency would like to continue to work with the one vendor who built the most effective prototype. They don't want to have to compete the follow-on work. Each prototype (one per company) is estimated to cost $750k and will take roughly 6 months to build. The estimated cost for the follow-on work (to be performed by a single vendor) is $25M over 3 years. What options should the agency consider to craft an acquisition that would support this scenario? Thank you.


    Answer

    The acquisition strategy will depend on the procurement authorities granted to the civilian agency. Other transactions (OTs) are a flexible procurement vehicle can be used by those civilian agencies who have been granted the statutory authority to use them. One viable approach would be if the civilian agency was granted the authority to award an OT for a prototype with a follow-on production OT without competition, similar to what DoD is authorized under title 10, U.S.C., §2371b. GAO detailed the civilian agencies who can award OTs in the following report at https://www.gao.gov/assets/gao-16-209-highlights.pdf

    If OTs are not an option, then another possibility is either a small business innovation research (SBIR) or small business technology transfer (STTR) award if the civilian agency has been granted the authority under title 15, U.S.C,  §638. There are differences between these two vehicles, to include the length of Phase I, the employment of the principal investigator, and the involvement of subcontractors. Phase III allows for the right to sole-source contracts and no limit on the dollar size of the Phase III procurement. 

    The applicable law in the U.S.C.:  https://www.govinfo.gov/content/pkg/USCODE-2011-title15/pdf/USCODE-2011-title15-chap14A-sec638.pdf

    Explanation of the differences between SBIRs and STTRs:  https://www.sbir.gov/sites/all/themes/sbir/dawnbreaker/img/documents/Course1-Tutorial3.pdf

    Explanation of Phase III rights:  https://www.sbir.gov/tutorials/data-rights/tutorial-4

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