Lawmakers propose defense policy changes to boost innovation, commercial partnerships

By Briana Reilly  / July 8, 2022

Ahead of the House debate next week on the fiscal year 2023 defense policy bill, lawmakers have proposed a series of bipartisan amendments designed to bolster innovation and partnerships with nontraditional defense contractors.

Among the more than 1,000 measures members of Congress have floated thus far are provisions to create a new pilot program “to accelerate the development of advanced technology for national security,” expand the Defense Department’s other transaction authority and compel the Pentagon’s chief technology officer to submit unfunded priorities lists.

The planned five-year pilot program, from Reps. Chrissy Houlahan (D-PA), Pat Fallon (R-TX) and Jim Banks (R-IN), aims to target small and nontraditional businesses creating capabilities the defense secretary deems necessary to support military modernization, per the amendment text.

The language would include built-in incentives for commercial entities to participate in the program, which seeks to further U.S. “global superiority in advanced technologies of importance to national security” while speeding up the transition and development of those technologies to the military services.

In a statement sent Thursday to Inside Defense, Houlahan said the push would provide another pathway “to accelerate the adoption of the critical technologies these small businesses provide.”

While she added she “wholeheartedly” backs the Defense Innovation Unit, the organization that aims to leverage commercial technologies for DOD, she noted the outfit is “only one small effort” within the military targeting small businesses and non-traditional defense contractors -- companies that face challenges securing funding and bridging the so-called “valley of death” to transition to a service program.

Though Senate authorizers haven’t released their defense policy bill text following committee approval in mid-June, a recent summary shows lawmakers included a similar measure in their plan. The summary provides few details on the pilot, which it calls the public-private partnership technology investment program. It characterizes the program as an effort “to enhance development and transition of high-priority technologies.”

Houlahan’s text doesn’t include a proposed funding level associated with the program or details about how the incentive structure would work. Her statement didn’t comment on specifics tied to either of those areas, which would likely be worked out in conference.

Another amendment, led by Rep. Mikie Sherrill (D-NJ), looks to tweak DOD’s other transaction authority to clear the way for prototyping at military installations and facilities.

A Sherrill staffer told Inside Defense Friday that the change could let military officials work with sustainable or renewable energy companies to, for example, prototype integrated solar roofing at defense bases.

The staffer said the existing OTA limitation stems from the FY-15 National Defense Authorization Act. Though the law broadened the authority’s application from weapons or weapon systems to offerings that enhance “the mission effectiveness of military personnel and the supporting platforms, systems, components, or materials proposed to be acquired or developed” by DOD, per the text, the staffer said the language excluded prototyping for installations.

In addition to potentially addressing resiliency and climate impact concerns, the staffer said the proposed language could be an avenue for nontraditional contractors to work with the military. Reps. Stephanie Bice (R-OK), Steven Horsford (D-NV) and Guy Reschenthaler (R-PA) also signed onto the measure.

Meanwhile, a separate provision from Banks and Rep. Jim Langevin (D-RI) would require the under secretary of defense for research and engineering to submit an unfunded priority list covering DOD-wide research, development, test and evaluation.

Heidi Shyu in the spring submitted a $5.7 billion UPL request, though it included 126 military construction projects across the services, divided between major and minor items, that are tied to DOD laboratories and testing facilities.

Lawmakers in the 2017 National Defense Authorization Act stipulated that the military services, the Missile Defense Agency and the combatant commands submit their UPLs within 10 days of the president's budget request to Congress. But the language has been amended in the intervening years to ensure the documents include certain military construction projects and that the heads of space operations and the National Guard Bureau, as well as the DOD comptroller, also turn in the lists, a Congressional Research Service report from November 2021 shows.

In separate statements to Inside Defense this week, Banks and Langevin -- the ranking member and chair, respectively, of the House Armed Services Committee’s cyber, innovative technologies and information systems panel -- touted the necessity of the amendment both to counter China and ensure research and engineering priorities are “able to fairly compete for congressional funding,” in the words of Langevin spokesman Matt Fidel.

“Innovation is foundational to the future of defense and investment in science and technology within the DOD is as crucial as investment in traditional military hardware,” Banks said in his statement. “My amendment would give members a fuller picture of how funds could be spent on developing and investing in emerging technologies to keep pace with China.”

The amendments are set to be debated upon lawmakers’ return from recess next week, legislative action that’s slated to occur in the wake of the House Armed Services Committee’s June 23 passage of the FY-23 defense spending bill. The version carries a topline that’s $37 billion larger than what was included in President Biden’s budget request. The White House’s budget seeks $813 billion in total national defense spending, with $773 billion of that earmarked for the Pentagon.