In July 2025, the U.S. Office of Management and Budget (OMB) proposed legislative changes to current procurement laws that include a recommendation to provide the National Aeronautics and Space Administration (NASA) with permanent statutory authority to utilize Commercial Solutions Openings (CSOs) and Other Transaction agreements (OTAs). These acquisition tools, long used by the U.S. Department of Defense (DoD), are designed to reduce procurement barriers, accelerate timelines, and enable engagement with innovative commercial vendors, particularly those that do not traditionally contract with the federal government. Together, these changes are intended to substantially enhance NASA’s ability to access cutting-edge technologies and support complex mission needs by enabling NASA to engage in faster, more agile procurement, reduce administrative overhead, and broaden participation by start-ups, research institutions, and commercial technology providers.
The proposed legislation would make two significant changes that could benefit companies looking to break into contracting with NASA. First, it would make NASA’s existing CSO authority permanent and extend its applicability to awards from $10 million to $100 million. Under a CSO, agencies may solicit proposals for innovative commercial solutions through simplified, non-FAR-based procedures. Unlike traditional solicitations, CSOs focus on outcomes and allow for greater flexibility in how offers are evaluated and awarded. The proposed changes mirror the authority already made permanent for DoD under prior National Defense Authorization Act legislation and reflect growing interest in expanding the government’s access to nontraditional contractors.
Second, the proposal would grant NASA permanent authority (it was set to expire in 2029) to use OTAs for prototype projects. OTAs allow for more flexible contracting when compared to traditional government procurement (i.e., pursuant to the Federal Acquisition Regulation, or FAR). OTA’s are not subject to the FAR and therefore include fewer extra-contract compliance obligations that apply to FAR-based procurement. Importantly, the proposed authority includes the ability to issue noncompetitive follow-on production contracts, provided the initial prototype effort was successful and met statutory conditions. This provision would allow NASA to move directly from prototyping to scaled production without issuing a new competitive solicitation.
These changes, if adopted, would present increased opportunities to partner with NASA under flexible terms that more closely resemble commercial transactions that expand NASA’s access to commercial innovation while reducing procurement timelines and compliance burdens. The agency’s growing portfolio—including Moon-to-Mars missions, climate monitoring, and deep space communications—requires faster access to emerging technologies that may not fit within the traditional FAR-based process. While these changes have only been proposed and it is not clear whether they will gain support in Congress, by establishing permanent CSO and OTA authorities, Congress would signal support for acquisition models that prioritize speed, flexibility, and innovation.
We will follow this proposed legislation and other proposed changes to the rules surrounding government procurements. For questions about this or any matter concerning your business with the federal government, please contact one of Wilson Sonsini’s Government Contracts attorneys.
