Air Force Spending on IT Using Other Transaction Agreements, FY 2021-2023

Last week’s post took a look at the Fourth Estate’s use of Other Transaction Agreements (OTAs) for information technology (IT) and non-IT requirements from fiscal 2021 to 2023. For the post two weeks ago showing the same data for the U.S. Army, click here. This week’s post continues our multi-week deep dive into the Department of Defense’s use of OTAs for IT only. In this article, I’ll be analyzing the reported data for the U.S. Air Force.

Total Air Force IT OTA Spending, FY 2021-2023

Although the Air Force has been using OTAs for IT prototypes for several years, it is really only in FY 2023 that spending took off, so to speak.

It appeared that spending was poised to break $1.0B in FY 2021, but it declined slightly in FY 2022 before surging to $1.0B in FY 2023. Growth in that latter year can be attributed to big jumps in three programs – the Space Development Agency’s Tranche 1 Tracking Layer, Tranche 1 Transport Layer, and the Proliferated Warfighter Space Architecture Tranche 2 Transport Layer Beta Program.

Why the Air Force reported Space Development Agency (SDA) spending under itself is curious because the SDA is a Fourth Estate agency. It does work closely with U.S. Space Force (USSF), though, so it looks like the Air Force procured the prototype work for an SDA program that will benefit the USSF.

IT OTA Spending by Air Force Organization, FY 2021-2023

The three-year cumulative spending data by Air Force organization looks like this.

The appearance of the Air Force Materiel Command at the top of the list makes sense. It is home to many of the Air Force’s technology R&D organizations. For example, $690M of the total spending for FY 2021-2023 can be traced back to the Air Force Life Cycle Management Center. The top three directorates there by total spending were C3I/Networks ($335M), Program Development and Integration ($39M), and Agile Combat Support ($33M)

Illustrating how bizarre the reporting of SDA spending data under the Air Force is, spending by the U.S. Space Force, under which one would expect to find space-related programs, actually fell from $428M in FY 2021 to $290M in FY 2023.

In third place by spending was the Air Force District of Washington (AFDW). The AFDW is a steady user of OTAs, spending over $19M in FY 2021 and $26M in FY 2023. All told, the AFDW spent $22M of that FY 2023 total on Predictive Maintenance Software.

Spending by Technology Area, FY 2021-2023

Lastly, when it comes to the technologies the Air Force is spending prototype dollars on the data shakes out as follows:

The satellite communications (SATCOM) total makes sense based on the SDA programs noted above. Spending on sensor technology also makes sense given the nature of the Air Force’s mission and its global operations. My colleague, John Slye, recently posted a deep dive on the Air Force’s cyber spending, so I won’t go into depth on that. His article can be found here.

Spending on communications technology has been focused on developing a space-based internet capability. One agreement awarded to Space Exploration Technologies Corporation for space-based internet had $102M obligated through it. The Air Force awarded a second OTA to SES Government Services to further develop the capability in FY 2023. Spending on that OTA totaled $29M that fiscal year.

Final Thoughts

Removing the SDA-related efforts from the FY 2023 data results in a total of $1.0B in Air Force OTA spending on IT prototypes. This means the Air Force is still using OTAs more than they have been, but the growth is more consistently near $1.0B as opposed to approaching $2.0B. The Air Force’s use of OTAs for IT prototypes is likely to continue, therefore, but it might not look as strong in future years if SDA requirements are reported under the Fourth Estate.