Monooxygenase component of a two-component system involved in the biosynthesis of the side chain of the aminoglycoside antibiotics in the biosynthetic pathway of butirosin. Together with BtrV, mediates hydroxylation of gamma-L-Glu-GABA-S-BtrI. Not able to hydroxylate free substrates, activation by the acyl-carrier protein is mandatory. Octanoyl-S-[BtrI acyl-carrier protein] is also accepted as substrate. 4-(gamma-L-glutamylamino)butanoy-[BtrI ACP] + FMNH2 + O2 = 4-(gamma-L-glutamylamino)-(2S)-2-hydroxybutanoyl-[BtrI ACP] + FMN + H(+) + H2O Antibiotic biosynthesis; butirosin biosynthesis. Belongs to the bacterial luciferase oxidoreductase family.