Senator urges more oversight, data tracking on defense OTAs 

Sen. Catherine Cortez Masto, D-Nev., proposed legislation this week that would require the Defense Department to set up a new pilot program to trace all contracts that are awarded via other transaction agreements, or OTAs. 

The Pentagon uses this procurement mechanism to enable components more flexibility than traditional funding pathways do. OTAs are also seen as a way to support small companies carrying out technology-driven prototype, research, and production projects for the government and military.

“Nevada is at the forefront of innovation, but small businesses need more support to enter the defense sector. My bill ensures the federal government is helping new small businesses get the funding they need to succeed in this industry by bringing much needed oversight to OTA awards,” Cortez Masto told DefenseScoop in an email on Thursday.

If passed, it would mandate the undersecretary of defense for acquisition and sustainment to set up a pilot program for DOD to properly “track the number and amounts awarded to small businesses and nontraditional defense contractors performing on transactions using other transaction authority, including those carried out through consortia,” according to the proposed bill’s text, which was shared with DefenseScoop.

The legislation would require the directorate to brief appropriate congressional committees regularly over the next five years or so, on the overarching process and the awards data that the pilot program captures.

“Not later than September 30, 2029, the Department shall provide a briefing to the Committees on Armed Services of the Senate and the House of Representatives on the final data collected and shall include any recommendations to make the data collection permanent,” the bill states. 

Notably, a pilot of this type marks a key recommendation that the Government Accountability Office presented in its 2022 report that put a spotlight on needs for improving OTA management.

“As DOD continues to rely on OTAs, Congress must increase reporting requirements and oversight over the program to prevent fraud and abuse. Cortez Masto’s legislation will help DOD use its OTA tools more effectively, improve the way it tracks where OTA award dollars are going, and make it easier for small businesses to engage with DOD to foster innovation and strengthen our national security,” a spokesperson for the senator told DefenseScoop. 

Beginning Friday, both congressional chambers are in recess through Sept. 9.