COVID-19 Related Provisions in the Draft FY 2021 National Defense Authorization Act

Key Takeaways

• The bill creates a new program for supporting small businesses through the public health crisis.
• Lessons learned from the crisis will be used to improve requirements generation in the face of COVID-19 related disruptions.
• DOD will receive more authority to reprogram funds for COVID-19 response.

Committees in both the House of Representatives and Senate are busy marking up their versions of the National Defense Authorization Act for Fiscal Year 2021. Once finished, the two versions of the bill (H.R. 6395) will be reconciled into a final single copy that the full bodies of each congressional chamber will vote on before sending the legislation to the White House for the President’s signature into law. Currently, it looks like this process will be finished before the end of July 2020. This year’s version of H.R. 6395 is unique in that it is the first NDAA to contain provisions pertaining to the novel coronavirus (COVID-19) public health emergency. Assuming these provisions remain in the final version of the NDAA, they are as follows.

SEC. 825. establishes a Small Business Industrial Base Resiliency Program and authorizes the Assistant Secretary of Defense Industrial Base Policy to enter into transactions to purchase, or make a commitment to purchase, goods and services from small business concerns in response to the COVID-19 pandemic.

Implication – DOD has been trying to support its industrial base throughout the pandemic in order to maintain readiness in the event of a national security crisis. Small businesses have nevertheless been the hardest hit by falling revenue. The creation of a new coordinating office would hopefully focus more effort and resources on supporting small firms. Additionally, the DOD could benefit from ensuring that critical parts of its supply chain remain intact and located in the United States.

SEC. 826 directs the secretaries of the military departments to assess the effectiveness of their requirements development processes to improve the agility and timeliness of acquisitions. Sub-section M requests the MILDEP secretaries incorporate lessons learned from responding to the COVID–19 pandemic into their findings.

Implication – Program disruptions occurred across the board when active military, civilian, and contracting personnel were sent home in response to the COVID-19 emergency. Discussions about the implications are likely to concern how requirements generation can operate smoothly in the future using telework collaboration tools and the cloud. Investment in a requirements-focused collaboration capability could be possible.

SEC. 1003 concerns the Pandemic Preparedness and Resilience National Security Fund (PPRNSF), establishing a notice requirement for accounting transfers from the Fund. The section also exempts transfers from counting toward the $4.0B limitation of General Transfer Authority listed in SEC. 1001.

SEC. 1003 authorizes the following transfers from the PPRNSF:

• $200M to Procurement, Defense-Wide to carry out the Small Business Industrial Base Resilience Program established by SEC. 825 (see above).
• Up to $50M back to Defense-Wide RDT&E to fund research that aims to rapidly produce medical countermeasures against novel threats, at population scale and approved for use in people.
• $750M to RDT&E accounts across all of the MILDEPS for R&D directly related to bio-preparedness and pandemic preparedness and resilience.

Implication – The PPRNSF provides another financial mechanism for DOD to respond to COVID-19, should the public health crisis continue into calendar year 2021. The transferable amounts listed in SEC. 1003 indicate the level of reprogrammed funding that could flow into COVID-19 response efforts.