The Pentagon is asking Congress to expand its authority under the Defense Production Act to include investments in military suppliers based in the United Kingdom and Australia, according to a new legislative proposal.
Current law limits DPA Title III investments to “domestic sources” in the United States and Canada, which DOD says “unnecessarily constrains select DPA authorities and limits their abilities to ensure a robust industrial base through use of Title III.”
“Adopting a definition specific to Title III that includes the nation’s closest allies will aid the DPA Title III Program in its mission to ensure the timely availability of essential industrial resources to support national defense and homeland security requirements,” the proposal, submitted April 28, states.
DOD’s proposed expansion would now include the United Kingdom and Australia.
“Adopting a definition specific to Title III that includes the nation’s closest allies will aid the DPA Title III Program in its mission to ensure the timely availability of essential industrial resources to support national defense and homeland security requirements,” DOD states. “The DPA Title III Program will be able to engage with companies in the third and fourth tiers of supply chains and exercise larger control over supply chains as a whole.”
This change in legislation would also align with the National Technology and Industrial Base, which Congress expanded in 2017 to include the U.K. and Australia.
“The reason behind this expansion was to allow the U.S. government to leverage the resources of its closest allies to enrich U.S. manufacturing and industrial base capabilities and increase the nation’s advantage in an environment of great competition,” DOD states. “This same reasoning applies to the proposed change to the DPA.”
The Pentagon also wants Congress to allow it to keep a greater balance in the DPA Fund at the end of the year. Current law states the end-of-year DPA Fund balance cannot exceed $750 million with all excess funds to be returned to the treasury.
“Removing this limitation ensures that the DPA Title III Program will not be penalized for increased appropriations,” DOD’s proposal states. “As the DPA authorities are increasingly leveraged to respond to the needs of other agencies as well as the most critical national defense requirements, the balance of the DPA Fund is anticipated to rise accordingly.”
Though DOD also “pursues the most expedient path to effort execution,” the proposal notes that some acquisition or industrial base mitigation strategies cannot be completed in the span of a year.
“As such, the law should be amended to allow for an increased balance so that funds that are appropriated or transferred into the DPA Fund are not returned to the treasury and are allowed to be utilized for their intended purposes over a period of time,” DOD states.
Under the proposal, the DPA Fund would contain $968.6 million in fiscal year 2024, $767.8 million in FY-25, $556.4 million for FY-26, $567 million for FY-27 and $325.8 million for FY-28.
The department also proposes the Air Force secretary no longer be the “sole executive agent” for DPA Title III.
“The increased appropriations to the program requires DOD to utilize all available contracting mechanisms to expediently obligate funds,” the Pentagon said. “By changing the designation of the secretary of the Air Force as ‘the sole and exclusive Department of Defense executive agent’ to ‘a Department of Defense executive agent’ the DPA Title III program will be able to leverage additional contracting resources when necessary without having to undertake laborious and time-consuming delegation activities.”