II 

111TH CONGRESS 

1ST SESSION S. 1677 

To reauthorize the Defense Production Act of 1950, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 16, 2009 

Mr. DODD (for himself and Mr. SHELBY) introduced the following bill; which 

was read twice, considered, read the third time, and passed 

A BILL 

To reauthorize the Defense Production Act of 1950, and 

for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Defense Production Act Reauthorization of 2009’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Reauthorization of Defense Production Act of 1950. 

Sec. 3. Declaration of policy. 

Sec. 4. Priority in contracts and orders. 

Sec. 5. Designation of energy as a strategic and critical material. 

Sec. 6. Strengthening domestic capability. 

Sec. 7. Expansion of productive capacity and supply. 

Sec. 8. Definitions. 


jbell on DSKDVH8Z91PROD with BILLS
2 

•S 1677 CPS

Sec. 9. Voluntary agreements and plans of action for national defense. 

Sec. 10. Employment of personnel; appointment policies; nucleus executive reserve; use of confidential information by employees; printing 

and distribution of reports. 

Sec. 11. Defense Production Act Committee. 

Sec. 12. Annual report on impact of offsets. 

1 SEC. 2. REAUTHORIZATION OF DEFENSE PRODUCTION ACT 

2 OF 1950. 

3 (a) TERMINATION OF ACT.— 

4 (1) TERMINATION.—Section 717 of the Defense 

5 Production Act of 1950 (50 U.S.C. App. 2166) is 

6 amended— 

7 (A) by striking subsections (a) and (b) and 

8 inserting the following: 

9 ‘‘(a) Title I (except section 104), title III, and title 

10 VII (except sections 707, 708, and 721 ) shall terminate 

11 on September 30, 2014, except that all authority extended 

12 under title III on or after the date of enactment of the 

13 Defense Production Act Reauthorization of 2009 shall be 

14 effective for any fiscal year only to such extent or in such 

15 amounts as are provided in advance in appropriations 

16 Acts. 

17 ‘‘(b) Notwithstanding subsection (a), any agency cre18 ated under a provision of law that is terminated under 

19 subsection (a) may continue in existence, for purposes of 

20 liquidation, for a period not to exceed 6 months, beginning 

21 on the date of termination of the provision authorizing the 

22 creation of such agency under subsection (a).’’; and 


jbell on DSKDVH8Z91PROD with BILLS
3 

•S 1677 CPS

1 (B) in subsection (c), by striking the sec2 ond undesignated paragraph. 

3 (2) REPEALS.—Titles II, IV, V, and VI of the 

4 Defense Production Act of 1950 (50 U.S.C. App. 

5 2151 et seq., 2101 et seq., 2121 et seq., and 2131 

6 et seq.) are repealed. 

7 (b) AUTHORIZATION OF APPROPRIATIONS.—Section 

8 711 of the Defense Production Act of 1950 (50 U.S.C. 

9 App. 2161) is amended— 

10 (1) in subsection (a)— 

11 (A) in the first sentence, by striking ‘‘(in12 cluding’’ and all that follows through ‘‘) by’’ 

13 and inserting ‘‘by’’; and 

14 (B) by striking ‘‘(a) AUTHORIZATION.— 

15 Except as provided in subsection (b), there’’ 

16 and inserting ‘‘There’’; and 

17 (2) by striking subsection (b). 

18 SEC. 3. DECLARATION OF POLICY. 

19 (a) FINDINGS.—Section 2 of the Defense Production 

20 Act of 1950 (50 U.S.C. App. 2062) is amended to read 

21 as follows: 

22 ‘‘SEC. 2. DECLARATION OF POLICY. 

23 ‘‘(a) FINDINGS.—Congress finds that— 

24 ‘‘(1) the security of the United States is de25 pendent on the ability of the domestic industrial 


jbell on DSKDVH8Z91PROD with BILLS
4 

•S 1677 CPS

1 base to supply materials and services for the na2 tional defense and to prepare for and respond to 

3 military conflicts, natural or man-caused disasters, 

4 or acts of terrorism within the United States; 

5 ‘‘(2) to ensure the vitality of the domestic in6 dustrial base, actions are needed— 

7 ‘‘(A) to promote industrial resources pre8 paredness in the event of domestic or foreign 

9 threats to the security of the United States; 

10 ‘‘(B) to support continuing improvements 

11 in industrial efficiency and responsiveness; 

12 ‘‘(C) to provide for the protection and res13 toration of domestic critical infrastructure oper14 ations under emergency conditions; and 

15 ‘‘(D) to respond to actions taken outside of 

16 the United States that could result in reduced 

17 supplies of strategic and critical materials, in18 cluding energy, necessary for national defense 

19 and the general economic well-being of the 

20 United States; 

21 ‘‘(3) in order to provide for the national secu22 rity, the national defense preparedness effort of the 

23 United States Government requires— 


jbell on DSKDVH8Z91PROD with BILLS
5 

•S 1677 CPS

1 ‘‘(A) preparedness programs to respond to 

2 both domestic emergencies and international 

3 threats to national defense; 

4 ‘‘(B) measures to improve the domestic in5 dustrial base for national defense; 

6 ‘‘(C) the development of domestic produc7 tive capacity to meet— 

8 ‘‘(i) essential national defense needs 

9 that can result from emergency conditions; 

10 and 

11 ‘‘(ii) unique technological require12 ments; and 

13 ‘‘(D) the diversion of certain materials and 

14 facilities from ordinary use to national defense 

15 purposes, when national defense needs cannot 

16 otherwise be satisfied in a timely fashion; 

17 ‘‘(4) to meet the requirements referred to in 

18 this subsection, this Act provides the President with 

19 an array of authorities to shape national defense 

20 preparedness programs and to take appropriate 

21 steps to maintain and enhance the domestic indus22 trial base; 

23 ‘‘(5) in order to ensure national defense pre24 paredness, it is necessary and appropriate to assure 


jbell on DSKDVH8Z91PROD with BILLS
6 

•S 1677 CPS

1 the availability of domestic energy supplies for na2 tional defense needs; 

3 ‘‘(6) to further assure the adequate mainte4 nance of the domestic industrial base, to the max5 imum extent possible, domestic energy supplies 

6 should be augmented through reliance on renewable 

7 energy sources (including solar, geothermal, wind, 

8 and biomass sources), more efficient energy storage 

9 and distribution technologies, and energy conserva10 tion measures; 

11 ‘‘(7) much of the industrial capacity that is re12 lied upon by the United States Government for mili13 tary production and other national defense purposes 

14 is deeply and directly influenced by— 

15 ‘‘(A) the overall competitiveness of the in16 dustrial economy of the United States; and 

17 ‘‘(B) the ability of industries in the United 

18 States, in general, to produce internationally 

19 competitive products and operate profitably 

20 while maintaining adequate research and devel21 opment to preserve competitiveness with respect 

22 to military and civilian production; and 

23 ‘‘(8) the inability of industries in the United 

24 States, especially smaller subcontractors and sup25 pliers, to provide vital parts and components and 


jbell on DSKDVH8Z91PROD with BILLS
7 

•S 1677 CPS

1 other materials would impair the ability to sustain 

2 the Armed Forces of the United States in combat 

3 for longer than a short period. 

4 ‘‘(b) STATEMENT OF POLICY.—It is the policy of the 

5 United States that— 

6 ‘‘(1) to ensure the adequacy of productive ca7 pacity and supply, Federal departments and agen8 cies that are responsible for national defense acquisi9 tion should continuously assess the capability of the 

10 domestic industrial base to satisfy production re11 quirements under both peacetime and emergency 

12 conditions, specifically evaluating the availability of 

13 adequate production sources, including subcontrac14 tors and suppliers, materials, skilled labor, and pro15 fessional and technical personnel; 

16 ‘‘(2) every effort should be made to foster co17 operation between the defense and commercial sec18 tors for research and development and for acquisi19 tion of materials, components, and equipment; 

20 ‘‘(3) plans and programs to carry out the pur21 poses of this Act should be undertaken with due con22 sideration for promoting efficiency and competition; 

23 ‘‘(4) in providing United States Government fi24 nancial assistance under this Act to correct a domes25 tic industrial base shortfall, the President should 


jbell on DSKDVH8Z91PROD with BILLS
8 

•S 1677 CPS

1 give consideration to the creation or maintenance of 

2 production sources that will remain economically via3 ble after such assistance has ended; 

4 ‘‘(5) authorities under this Act should be used 

5 to reduce the vulnerability of the United States to 

6 terrorist attacks, and to minimize the damage and 

7 assist in the recovery from terrorist attacks that 

8 occur in the United States; 

9 ‘‘(6) in order to ensure productive capacity in 

10 the event of an attack on the United States, the 

11 United States Government should encourage the ge12 ographic dispersal of industrial facilities in the 

13 United States to discourage the concentration of 

14 such productive facilities within limited geographic 

15 areas that are vulnerable to attack by an enemy of 

16 the United States; 

17 ‘‘(7) to ensure that essential national defense 

18 requirements are met, consideration should be given 

19 to stockpiling strategic materials, to the extent that 

20 such stockpiling is economical and feasible; and 

21 ‘‘(8) in the construction of any industrial facil22 ity owned by the United States Government, in the 

23 rendition of any financial assistance by the United 

24 States Government for the construction, expansion, 

25 or improvement of any industrial facility, and in the 


jbell on DSKDVH8Z91PROD with BILLS
9 

•S 1677 CPS

1 production of goods and services, under this Act or 

2 any other provision of law, each department and 

3 agency of the United States Government should 

4 apply, under the coordination of the Federal Emer5 gency Management Agency, when practicable and 

6 consistent with existing law and the desirability for 

7 maintaining a sound economy, the principle of geo8 graphic dispersal of such facilities in the interest of 

9 national defense.’’. 

10 SEC. 4. PRIORITY IN CONTRACTS AND ORDERS. 

11 Section 101 of the Defense Production Act of 1950 

12 (50 U.S.C. App. 2071) is amended by adding at the end 

13 the following: 

14 ‘‘(d) The head of each Federal agency to which the 

15 President delegates authority under this section shall— 

16 ‘‘(1) not later than 270 days after the date of 

17 enactment of the Defense Production Act Reauthor18 ization of 2009, issue final rules, in accordance with 

19 section 553 of title 5, United States Code, that es20 tablish standards and procedures by which the prior21 ities and allocations authority under this section is 

22 used to promote the national defense, under both 

23 emergency and nonemergency conditions; and 

24 ‘‘(2) as appropriate and to the extent prac25 ticable, consult with the heads of other Federal 


jbell on DSKDVH8Z91PROD with BILLS
10 

•S 1677 CPS

1 agencies to develop a consistent and unified Federal 

2 priorities and allocations system.’’. 

3 SEC. 5. DESIGNATION OF ENERGY AS A STRATEGIC AND 

4 CRITICAL MATERIAL. 

5 Section 106 of the Defense Production Act of 1950 

6 (50 U.S.C. App. 2076) is amended— 

7 (1) by striking ‘‘such designation’’ and all that 

8 follows through ‘‘(1)’’ and inserting ‘‘such designa9 tion’’; 

10 (2) by striking ‘‘; or’’ and inserting a period; 

11 and 

12 (3) by striking paragraph (2). 

13 SEC. 6. STRENGTHENING DOMESTIC CAPABILITY. 

14 Section 107 of the Defense Production Act of 1950 

15 (50 U.S.C. App. 2077) is amended— 

16 (1) in subsection (a)— 

17 (A) by inserting ‘‘restore,’’ after ‘‘mod18 ernize,’’; and 

19 (B) by inserting ‘‘materials,’’ after 

20 ‘‘items,’’; and 

21 (2) in subsection (b)— 

22 (A) by striking paragraph (1); 

23 (B) by redesignating paragraphs (2) and 

24 (3) as paragraphs (1) and (2), respectively; and 


jbell on DSKDVH8Z91PROD with BILLS
11 

•S 1677 CPS

1 (C) in paragraph (1), as so redesignated, 

2 by striking ‘‘or critical technology items’’ and 

3 inserting ‘‘, critical technology items, essential 

4 materials, and industrial resources’’. 

5 SEC. 7. EXPANSION OF PRODUCTIVE CAPACITY AND SUP6 PLY. 

7 Title III of the Defense Production Act of 1950 (50 

8 U.S.C. App. 2091 et seq.) is amended to read as follows: 

9 ‘‘TITLE III—EXPANSION OF PRO10 DUCTIVE CAPACITY AND SUP11 PLY 

12 ‘‘SEC. 301. PRESIDENTIAL AUTHORIZATION FOR THE NA13 TIONAL DEFENSE. 

14 ‘‘(a) EXPEDITING PRODUCTION AND DELIVERIES OR

15 SERVICES.— 

16 ‘‘(1) AUTHORIZED ACTIVITIES.—To reduce cur17 rent or projected shortfalls of industrial resources, 

18 critical technology items, or essential materials need19 ed for national defense purposes, subject to such 

20 regulations as the President may prescribe, the 

21 President may authorize a guaranteeing agency to 

22 provide guarantees of loans by private institutions 

23 for the purpose of financing any contractor, subcon24 tractor, provider of critical infrastructure, or other 

25 person in support of production capabilities or supVerDate Nov 24 2008 01:11 Sep 17, 2009 Jkt 079200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S1677.CPS S1677

jbell on DSKDVH8Z91PROD with BILLS
12 

•S 1677 CPS

1 plies that are deemed by the guaranteeing agency to 

2 be necessary to create, maintain, expedite, expand, 

3 protect, or restore production and deliveries or serv4 ices essential to the national defense. 

5 ‘‘(2) PRESIDENTIAL DETERMINATIONS RE6 QUIRED.—Except during a period of national emer7 gency declared by Congress or the President, a loan 

8 guarantee may be entered into under this section 

9 only if the President determines that— 

10 ‘‘(A) the loan guarantee is for an activity 

11 that supports the production or supply of an in12 dustrial resource, critical technology item, or 

13 material that is essential for national defense 

14 purposes; 

15 ‘‘(B) without a loan guarantee, credit is 

16 not available to the loan applicant under rea17 sonable terms or conditions sufficient to finance 

18 the activity; 

19 ‘‘(C) the loan guarantee is the most cost 

20 effective, expedient, and practical alternative for 

21 meeting the needs of the Federal Government; 

22 ‘‘(D) the prospective earning power of the 

23 loan applicant and the character and value of 

24 the security pledged provide a reasonable assur25 ance of repayment of the loan to be guaranteed; 


jbell on DSKDVH8Z91PROD with BILLS
13 

•S 1677 CPS

1 ‘‘(E) the loan to be guaranteed bears inter2 est at a rate determined by the Secretary of the 

3 Treasury to be reasonable, taking into account 

4 the then-current average yield on outstanding 

5 obligations of the United States with remaining 

6 periods of maturity comparable to the maturity 

7 of the loan; 

8 ‘‘(F) the loan agreement for the loan to be 

9 guaranteed provides that no provision of the 

10 loan agreement may be amended or waived 

11 without the consent of the fiscal agent of the 

12 United States for the guarantee; and 

13 ‘‘(G) the loan applicant has provided or 

14 will provide— 

15 ‘‘(i) an assurance of repayment, as de16 termined by the President; and 

17 ‘‘(ii) security— 

18 ‘‘(I) in the form of a performance 

19 bond, insurance, collateral, or other 

20 means acceptable to the fiscal agent 

21 of the United States; and 

22 ‘‘(II) in an amount equal to not 

23 less than 20 percent of the amount of 

24 the loan. 


jbell on DSKDVH8Z91PROD with BILLS
14 

•S 1677 CPS

1 ‘‘(3) LIMITATIONS ON LOANS.—Loans under 

2 this section may be— 

3 ‘‘(A) made or guaranteed under the au4 thority of this section only to the extent that an 

5 appropriations Act— 

6 ‘‘(i) provides, in advance, budget au7 thority for the cost of such guarantees, as 

8 defined in section 502 of the Federal Cred9 it Reform Act of 1990 (2 U.S.C. 661a); 

10 and 

11 ‘‘(ii) establishes a limitation on the 

12 total loan principal that may be guaran13 teed; and 

14 ‘‘(B) made without regard to the limita15 tions of existing law, other than section 1341 of 

16 title 31, United States Code. 

17 ‘‘(b) FISCAL AGENTS OF THE UNITED STATES.— 

18 ‘‘(1) IN GENERAL.—Any Federal agency or any 

19 Federal reserve bank, when designated by the Presi20 dent, is hereby authorized to act, on behalf of any 

21 guaranteeing agency, as fiscal agent of the United 

22 States in the making of such contracts of guarantee 

23 and in otherwise carrying out the purposes of this 

24 section. 


jbell on DSKDVH8Z91PROD with BILLS
15 

•S 1677 CPS

1 ‘‘(2) FUNDS.—All such funds as may be nec2 essary to enable any fiscal agent described in para3 graph (1) to carry out any guarantee made by it on 

4 behalf of any guaranteeing agency shall be supplied 

5 and disbursed by or under authority from such guar6 anteeing agency. 

7 ‘‘(3) LIMIT ON LIABILITY.—No fiscal agent de8 scribed in paragraph (1) shall have any responsi9 bility or accountability, except as agent in taking 

10 any action pursuant to or under authority of this 

11 section. 

12 ‘‘(4) REIMBURSEMENTS.—Each fiscal agent de13 scribed in paragraph (1) shall be reimbursed by each 

14 guaranteeing agency for all expenses and losses in15 curred by such fiscal agent in acting as agent on be16 half of such guaranteeing agency, including, notwith17 standing any other provision of law, attorneys’ fees 

18 and expenses of litigation. 

19 ‘‘(c) OVERSIGHT.— 

20 ‘‘(1) IN GENERAL.—All actions and operations 

21 of fiscal agents under authority of or pursuant to 

22 this section shall be subject to the supervision of the 

23 President, and to such regulations as the President 

24 may prescribe. 


jbell on DSKDVH8Z91PROD with BILLS
16 

•S 1677 CPS

1 ‘‘(2) OTHER AUTHORITY.—The President is au2 thorized to prescribe— 

3 ‘‘(A) either specifically or by maximum 

4 limits or otherwise, rates of interest, guarantee 

5 and commitment fees, and other charges which 

6 may be made in connection with loans, dis7 counts, advances, or commitments guaranteed 

8 by the guaranteeing agencies through fiscal 

9 agents under this section; and 

10 ‘‘(B) regulations governing the forms and 

11 procedures (which shall be uniform to the ex12 tent practicable) to be utilized in connection 

13 with such guarantees. 

14 ‘‘(d) AGGREGATE GUARANTEE AMOUNTS.— 

15 ‘‘(1) INDUSTRIAL RESOURCE AND CRITICAL

16 TECHNOLOGY SHORTFALLS.— 

17 ‘‘(A) IN GENERAL.—If the making of any 

18 guarantee or obligation of the Federal Govern19 ment under this title relating to a domestic in20 dustrial base shortfall would cause the aggre21 gate outstanding amount of all guarantees for 

22 such shortfall to exceed $50,000,000, any such 

23 guarantee may be made only— 

24 ‘‘(i) if the President has notified the 

25 Committee on Banking, Housing, and 


jbell on DSKDVH8Z91PROD with BILLS
17 

•S 1677 CPS

1 Urban Affairs of the Senate and the Com2 mittee on Financial Services of the House 

3 of Representatives in writing of the pro4 posed guarantee; and 

5 ‘‘(ii) after the 30-day period following 

6 the date on which notice under clause (i) 

7 is provided. 

8 ‘‘(B) WAIVERS AUTHORIZED.—The re9 quirements of subparagraph (A) may be 

10 waived— 

11 ‘‘(i) during a period of national emer12 gency declared by Congress or the Presi13 dent; or 

14 ‘‘(ii) upon a determination by the 

15 President, on a nondelegable basis, that a 

16 specific guarantee is necessary to avert an 

17 industrial resource or critical technology 

18 item shortfall that would severely impair 

19 national defense capability. 

20 ‘‘(2) OTHER LIMITATIONS.—The authority con21 ferred by this section shall not be used primarily to 

22 prevent the financial insolvency or bankruptcy of 

23 any person, unless— 

24 ‘‘(A) the President certifies that the insol25 vency or bankruptcy would have a direct and 


jbell on DSKDVH8Z91PROD with BILLS
18 

•S 1677 CPS

1 substantially adverse effect upon national de2 fense production; and 

3 ‘‘(B) a copy of the certification under sub4 paragraph (A), together with a detailed jus5 tification thereof, is transmitted to the Com6 mittee on Banking, Housing, and Urban Affairs 

7 of the Senate and the Committee on Financial 

8 Services of the House of Representatives not 

9 later than 10 days prior to the exercise of that 

10 authority for such use. 

11 ‘‘SEC. 302. LOANS TO PRIVATE BUSINESS ENTERPRISES. 

12 ‘‘(a) LOAN AUTHORITY.—To reduce current or pro13 jected shortfalls of industrial resources, critical technology 

14 items, or materials essential for the national defense, the 

15 President may make provision for loans to private busi16 ness enterprises (including nonprofit research corporations 

17 and providers of critical infrastructure) for the creation, 

18 maintenance, expansion, protection, or restoration of ca19 pacity, the development of technological processes, or the 

20 production of essential materials, including the explo21 ration, development, and mining of strategic and critical 

22 metals and minerals. 

23 ‘‘(b) CONDITIONS OF LOANS.—Loans may be made 

24 under this section on such terms and conditions as the 

25 President deems necessary, except that— 


jbell on DSKDVH8Z91PROD with BILLS
19 

•S 1677 CPS

1 ‘‘(1) financial assistance may be extended only 

2 to the extent that it is not otherwise available from 

3 private sources on reasonable terms; and 

4 ‘‘(2) during periods of national emergency de5 clared by the Congress or the President, no such 

6 loan may be made unless the President determines 

7 that— 

8 ‘‘(A) the loan is for an activity that sup9 ports the production or supply of an industrial 

10 resource, critical technology item, or material 

11 that is essential to the national defense; 

12 ‘‘(B) without the loan, United States in13 dustry cannot reasonably be expected to provide 

14 the needed capacity, technological processes, or 

15 materials in a timely manner; 

16 ‘‘(C) the loan is the most cost-effective, ex17 pedient, and practical alternative method for 

18 meeting the need; 

19 ‘‘(D) the prospective earning power of the 

20 loan applicant and the character and value of 

21 the security pledged provide a reasonable assur22 ance of repayment of the loan in accordance 

23 with the terms of the loan, as determined by 

24 the President; and 


jbell on DSKDVH8Z91PROD with BILLS
20 

•S 1677 CPS

1 ‘‘(E) the loan bears interest at a rate de2 termined by the Secretary of the Treasury to be 

3 reasonable, taking into account the then-current 

4 average yield on outstanding obligations of the 

5 United States with remaining periods of matu6 rity comparable to the maturity of the loan. 

7 ‘‘(c) LIMITATIONS ON LOANS.—Loans under this sec8 tion may be— 

9 ‘‘(1) made or guaranteed under the authority of 

10 this section only to the extent that an appropriations 

11 Act— 

12 ‘‘(A) provides, in advance, budget author13 ity for the cost of such guarantees, as defined 

14 in section 502 of the Federal Credit Reform 

15 Act of 1990 (2 U.S.C. 661a); and 

16 ‘‘(B) establishes a limitation on the total 

17 loan principal that may be guaranteed; and 

18 ‘‘(2) made without regard to the limitations of 

19 existing law, other than section 1341 of title 31, 

20 United States Code. 

21 ‘‘(d) AGGREGATE LOAN AMOUNTS.— 

22 ‘‘(1) IN GENERAL.—If the making of any loan 

23 under this section to correct a shortfall would cause 

24 the aggregate outstanding amount of all obligations 

25 of the Federal Government under this title relating 


jbell on DSKDVH8Z91PROD with BILLS
21 

•S 1677 CPS

1 to such shortfall to exceed $50,000,000, such loan 

2 may be made only— 

3 ‘‘(A) if the President has notified the Com4 mittee on Banking, Housing, and Urban Affairs 

5 of the Senate and the Committee on Financial 

6 Services of the House of Representatives, in 

7 writing, of the proposed loan; and 

8 ‘‘(B) after the 30-day period following the 

9 date on which notice under subparagraph (A) is 

10 provided. 

11 ‘‘(2) WAIVERS AUTHORIZED.—The require12 ments of paragraph (1) may be waived— 

13 ‘‘(A) during a period of national emergency 

14 declared by the Congress or the President; and 

15 ‘‘(B) upon a determination by the Presi16 dent, on a nondelegable basis, that a specific 

17 loan is necessary to avert an industrial resource 

18 or critical technology shortfall that would se19 verely impair national defense capability. 

20 ‘‘SEC. 303. OTHER PRESIDENTIAL ACTION AUTHORIZED. 

21 ‘‘(a) IN GENERAL.— 

22 ‘‘(1) IN GENERAL.—To create, maintain, pro23 tect, expand, or restore domestic industrial base ca24 pabilities essential for the national defense, the 

25 President may make provision— 


jbell on DSKDVH8Z91PROD with BILLS
22 

•S 1677 CPS

1 ‘‘(A) for purchases of or commitments to 

2 purchase an industrial resource or a critical 

3 technology item, for Government use or resale; 

4 ‘‘(B) for the encouragement of exploration, 

5 development, and mining of critical and stra6 tegic materials, and other materials; 

7 ‘‘(C) for the development of production ca8 pabilities; and 

9 ‘‘(D) for the increased use of emerging 

10 technologies in security program applications 

11 and the rapid transition of emerging tech12 nologies— 

13 ‘‘(i) from Government-sponsored re14 search and development to commercial ap15 plications; and 

16 ‘‘(ii) from commercial research and 

17 development to national defense applica18 tions. 

19 ‘‘(2) TREATMENT OF CERTAIN AGRICULTURAL

20 COMMODITIES.—A purchase for resale under this 

21 subsection shall not include that part of the supply 

22 of an agricultural commodity which is domestically 

23 produced, except to the extent that such domestically 

24 produced supply may be purchased for resale for in25 dustrial use or stockpiling. 


jbell on DSKDVH8Z91PROD with BILLS
23 

•S 1677 CPS

1 ‘‘(3) TERMS OF SALES.—No commodity pur2 chased under this subsection shall be sold at less 

3 than— 

4 ‘‘(A) the established ceiling price for such 

5 commodity, except that minerals, metals, and 

6 materials shall not be sold at less than the es7 tablished ceiling price, or the current domestic 

8 market price, whichever is lower; or 

9 ‘‘(B) if no ceiling price has been estab10 lished, the higher of— 

11 ‘‘(i) the current domestic market price 

12 for such commodity; or 

13 ‘‘(ii) the minimum sale price estab14 lished for agricultural commodities owned 

15 or controlled by the Commodity Credit 

16 Corporation, as provided in section 407 of 

17 the Agricultural Act of 1949 (7 U.S.C. 

18 1427). 

19 ‘‘(4) DELIVERY DATES.—No purchase or com20 mitment to purchase any imported agricultural com21 modity shall specify a delivery date which is more 

22 than 1 year after the date of termination of this sec23 tion. 

24 ‘‘(5) PRESIDENTIAL DETERMINATIONS.—Ex25 cept as provided in paragraph (7), the President 


jbell on DSKDVH8Z91PROD with BILLS
24 

•S 1677 CPS

1 may not execute a contract under this subsection un2 less the President determines that— 

3 ‘‘(A) the industrial resource, material, or 

4 critical technology item is essential to the na5 tional defense; and 

6 ‘‘(B) without Presidential action under this 

7 section, United States industry cannot reason8 ably be expected to provide the capability for 

9 the needed industrial resource, material, or crit10 ical technology item in a timely manner. 

11 ‘‘(6) NOTIFICATION TO CONGRESS OF SHORT12 FALL.— 

13 ‘‘(A) IN GENERAL.—Except as provided in 

14 paragraph (7), the President shall provide writ15 ten notice to the Committee on Banking, Hous16 ing, and Urban Affairs of the Senate and the 

17 Committee on Financial Services of the House 

18 of Representatives of a domestic industrial base 

19 shortfall prior to taking action under this sub20 section to remedy the shortfall. The notice shall 

21 include the determinations made by the Presi22 dent under paragraph (5). 

23 ‘‘(B) AGGREGATE AMOUNTS.—If the tak24 ing of any action under this subsection to cor25 rect a domestic industrial base shortfall would 


jbell on DSKDVH8Z91PROD with BILLS
25 

•S 1677 CPS

1 cause the aggregate outstanding amount of all 

2 such actions for such shortfall to exceed 

3 $50,000,000, the action or actions may be 

4 taken only after the 30-day period following the 

5 date on which the Committee on Banking, 

6 Housing, and Urban Affairs of the Senate and 

7 the Committee on Financial Services of the 

8 House of Representatives have been notified in 

9 writing of the proposed action. 

10 ‘‘(7) WAIVERS AUTHORIZED.—The require11 ments of paragraphs (1) through (6) may be 

12 waived— 

13 ‘‘(A) during a period of national emergency 

14 declared by the Congress or the President; or 

15 ‘‘(B) upon a determination by the Presi16 dent, on a nondelegable basis, that action is 

17 necessary to avert an industrial resource or 

18 critical technology item shortfall that would se19 verely impair national defense capability. 

20 ‘‘(b) EXEMPTION FOR CERTAIN LIMITATIONS.—Sub21 ject to the limitations in subsection (a), purchases and 

22 commitments to purchase and sales under subsection (a) 

23 may be made without regard to the limitations of existing 

24 law (other than section 1341 of title 31, United States 

25 Code), for such quantities, and on such terms and condiVerDate Nov 24 2008 01:11 Sep 17, 2009 Jkt 079200 PO 00000 Frm 00025 Fmt 6652 Sfmt 6201 E:\BILLS\S1677.CPS S1677

jbell on DSKDVH8Z91PROD with BILLS
26 

•S 1677 CPS

1 tions, including advance payments, and for such periods, 

2 but not extending beyond a date that is not more than 

3 10 years from the date on which such purchase, purchase 

4 commitment, or sale was initially made, as the President 

5 deems necessary, except that purchases or commitments 

6 to purchase involving higher than established ceiling prices 

7 (or if no such established ceiling prices exist, currently 

8 prevailing market prices) or anticipated loss on resale shall 

9 not be made, unless it is determined that supply of the 

10 materials could not be effectively increased at lower prices 

11 or on terms more favorable to the Government, or that 

12 such purchases are necessary to assure the availability to 

13 the United States of overseas supplies. 

14 ‘‘(c) PRESIDENTIAL FINDINGS.— 

15 ‘‘(1) IN GENERAL.—The President may take 

16 the actions described in paragraph (2), if the Presi17 dent finds that— 

18 ‘‘(A) under generally fair and equitable 

19 ceiling prices, for any raw or nonprocessed ma20 terial, there will result a decrease in supplies 

21 from high-cost sources of such material, and 

22 that the continuation of such supplies is nec23 essary to carry out the objectives of this title; 

24 or 


jbell on DSKDVH8Z91PROD with BILLS
27 

•S 1677 CPS

1 ‘‘(B) an increase in cost of transportation 

2 is temporary in character and threatens to im3 pair maximum production or supply in any area 

4 at stable prices of any materials. 

5 ‘‘(2) SUBSIDY PAYMENTS AUTHORIZED.—Upon 

6 a finding under paragraph (1), the President may 

7 make provision for subsidy payments on any such 

8 domestically produced material, other than an agri9 cultural commodity, in such amounts and in such 

10 manner (including purchases of such material and 

11 its resale at a loss), and on such terms and condi12 tions, as the President determines to be necessary to 

13 ensure that supplies from such high-cost sources are 

14 continued, or that maximum production or supply in 

15 such area at stable prices of such materials is main16 tained, as the case may be. 

17 ‘‘(d) INCIDENTAL AUTHORITY.—The procurement 

18 power granted to the President by this section shall in19 clude the power to transport and store and have processed 

20 and refined any materials procured under this section. 

21 ‘‘(e) INSTALLATION OF EQUIPMENT IN INDUSTRIAL

22 FACILITIES.— 

23 ‘‘(1) INSTALLATION AUTHORIZED.—If the 

24 President determines that such action will aid the 

25 national defense, the President is authorized— 


jbell on DSKDVH8Z91PROD with BILLS
28 

•S 1677 CPS

1 ‘‘(A) to procure and install additional 

2 equipment, facilities, processes or improvements 

3 to plants, factories, and other industrial facili4 ties owned by the Federal Government; 

5 ‘‘(B) to procure and install equipment 

6 owned by the Federal Government in plants, 

7 factories, and other industrial facilities owned 

8 by private persons; 

9 ‘‘(C) to provide for the modification or ex10 pansion of privately owned facilities, including 

11 the modification or improvement of production 

12 processes, when taking actions under section 

13 301, 302, or this section; and 

14 ‘‘(D) to sell or otherwise transfer equip15 ment owned by the Federal Government and in16 stalled under this subsection to the owners of 

17 such plants, factories, or other industrial facili18 ties. 

19 ‘‘(2) INDEMNIFICATION.—The owner of any 

20 plant, factory, or other industrial facility that re21 ceives equipment owned by the Federal Government 

22 under this section shall agree— 

23 ‘‘(A) to waive any claim against the United 

24 States under section 107 or 113 of the Com25 prehensive Environmental Response, CompensaVerDate Nov 24 2008 01:11 Sep 17, 2009 Jkt 079200 PO 00000 Frm 00028 Fmt 6652 Sfmt 6201 E:\BILLS\S1677.CPS S1677

jbell on DSKDVH8Z91PROD with BILLS
29 

•S 1677 CPS

1 tion, and Liability Act of 1980 (42 U.S.C. 9607 

2 and 9613); and 

3 ‘‘(B) to indemnify the United States 

4 against any claim described in paragraph (1) 

5 made by a third party that arises out of the 

6 presence or use of equipment owned by the 

7 Federal Government. 

8 ‘‘(f) EXCESS METALS, MINERALS, AND MATE9 RIALS.— 

10 ‘‘(1) IN GENERAL.—Notwithstanding any other 

11 provision of law to the contrary, metals, minerals, 

12 and materials acquired pursuant to this section 

13 which, in the judgment of the President, are excess 

14 to the needs of programs under this Act, shall be 

15 transferred to the National Defense Stockpile estab16 lished by the Strategic and Critical Materials Stock 

17 Piling Act (50 U.S.C. 98 et seq.), when the Presi18 dent deems such action to be in the public interest. 

19 ‘‘(2) TRANSFERS AT NO CHARGE.—Transfers 

20 made pursuant to this subsection shall be made 

21 without charge against or reimbursement from funds 

22 appropriated for the purposes of the Strategic and 

23 Critical Materials Stock Piling Act (50 U.S.C. 98 et 

24 seq.), except that costs incident to such transfer, 


jbell on DSKDVH8Z91PROD with BILLS
30 

•S 1677 CPS

1 other than acquisition costs, shall be paid or reim2 bursed from such funds. 

3 ‘‘(g) SUBSTITUTES.—When, in the judgement of the 

4 President, it will aid the national defense, the President 

5 may make provision for the development of substitutes for 

6 strategic and critical materials, critical components, crit7 ical technology items, and other industrial resources. 

8 ‘‘SEC. 304. DEFENSE PRODUCTION ACT FUND. 

9 ‘‘(a) ESTABLISHMENT OF FUND.—There is estab10 lished in the Treasury of the United States a separate 

11 fund to be known as the ‘Defense Production Act Fund’ 

12 (in this section referred to as the ‘Fund’). 

13 ‘‘(b) MONEYS IN FUND.—There shall be credited to 

14 the Fund— 

15 ‘‘(1) all moneys appropriated for the Fund, as 

16 authorized by section 711; and 

17 ‘‘(2) all moneys received by the Fund on trans18 actions entered into pursuant to section 303. 

19 ‘‘(c) USE OF FUND.—The Fund shall be available to 

20 carry out the provisions and purposes of this title, subject 

21 to the limitations set forth in this Act and in appropria22 tions Acts. 

23 ‘‘(d) DURATION OF FUND.—Moneys in the Fund 

24 shall remain available until expended. 


jbell on DSKDVH8Z91PROD with BILLS
31 

•S 1677 CPS

1 ‘‘(e) FUND BALANCE.—The Fund balance at the 

2 close of each fiscal year shall not exceed $750,000,000, 

3 excluding any moneys appropriated to the Fund during 

4 that fiscal year or obligated funds. If, at the close of any 

5 fiscal year, the Fund balance exceeds $750,000,000, the 

6 amount in excess of $750,000,000 shall be paid into the 

7 general fund of the Treasury. 

8 ‘‘(f) FUND MANAGER.—The President shall des9 ignate a Fund manager. The duties of the Fund manager 

10 shall include— 

11 ‘‘(1) determining the liability of the Fund in ac12 cordance with subsection (g); 

13 ‘‘(2) ensuring the visibility and accountability of 

14 transactions engaged in through the Fund; and 

15 ‘‘(3) reporting to the Congress each year re16 garding activities of the Fund during the previous 

17 fiscal year. 

18 ‘‘(g) LIABILITIES AGAINST FUND.—When any agree19 ment entered into pursuant to this title after December 

20 31, 1991, imposes any contingent liability upon the United 

21 States, such liability shall be considered an obligation 

22 against the Fund.’’. 

23 SEC. 8. DEFINITIONS. 

24 Section 702 of the Defense Production Act of 1950 

25 (50 U.S.C. App. 2152) is amended— 


jbell on DSKDVH8Z91PROD with BILLS
32 

•S 1677 CPS

1 (1) in paragraph (1), by striking ‘‘military 

2 equipment identified by the Secretary of Defense’’ 

3 and inserting ‘‘equipment identified by the Presi4 dent’’; 

5 (2) by striking paragraphs (2), (4), (9), and 

6 (18); 

7 (3) by redesignating paragraph (3) as para8 graph (2); 

9 (4) by inserting after paragraph (2), as so re10 designated, the following: 

11 ‘‘(3) CRITICAL TECHNOLOGY.—The term ‘crit12 ical technology’ includes any technology designated 

13 by the President to be essential to the national de14 fense.’’; 

15 (5) by redesignating paragraphs (5) through 

16 (8) as paragraphs (4) through (7), respectively; 

17 (6) in paragraph (6), as so redesignated— 

18 (A) in the paragraph heading, by striking 

19 ‘‘DEFENSE’’; 

20 (B) by striking ‘‘domestic defense’’ and in21 serting ‘‘domestic’’; and 

22 (C) by striking ‘‘graduated mobilization,’’; 

23 (7) by redesignating paragraphs (10) and (11) 

24 as paragraphs (8) and (9), respectively; 


jbell on DSKDVH8Z91PROD with BILLS
33 

•S 1677 CPS

1 (8) by inserting after paragraph (9), as so re2 designated, the following: 

3 ‘‘(10) GUARANTEEING AGENCY.—The term 

4 ‘guaranteeing agency’ means a department or agen5 cy of the United States engaged in procurement for 

6 the national defense. 

7 ‘‘(11) HOMELAND SECURITY.—The term ‘home8 land security’ includes efforts— 

9 ‘‘(A) to prevent terrorist attacks within the 

10 United States; 

11 ‘‘(B) to reduce the vulnerability of the 

12 United States to terrorism; 

13 ‘‘(C) to minimize damage from a terrorist 

14 attack in the United States; and 

15 ‘‘(D) to recover from a terrorist attack in 

16 the United States.’’; 

17 (9) in paragraph (12), by striking ‘‘capacity’’ 

18 and inserting ‘‘base’’; 

19 (10) in paragraph (14), by striking ‘‘military 

20 assistance to any foreign nation’’ and inserting 

21 ‘‘military or critical infrastructure assistance to any 

22 foreign nation, homeland security’’; and 

23 (11) in paragraph (16)— 

24 (A) in subparagraph (A), by striking ‘‘or’’ 

25 at the end; 


jbell on DSKDVH8Z91PROD with BILLS
34 

•S 1677 CPS

1 (B) in subparagraph (B), by striking the 

2 period and inserting a semicolon; and 

3 (C) by adding at the end the following: 

4 ‘‘(C) the movement of individuals and 

5 property by all modes of civil transportation; or 

6 ‘‘(D) other national defense programs and 

7 activities.’’. 

8 SEC. 9. VOLUNTARY AGREEMENTS AND PLANS OF ACTION 

9 FOR NATIONAL DEFENSE. 

10 Section 708 of the Defense Production Act of 1950 

11 (50 U.S.C. App. 2158) is amended— 

12 (1) in subsection (c)— 

13 (A) in paragraph (1), by striking ‘‘defense 

14 of the United States’’ and all that follows 

15 through the period and inserting ‘‘national de16 fense.’’; and 

17 (B) by adding at the end the following: 

18 ‘‘(3) Upon a determination by the President, on a 

19 nondelegable basis, that a specific voluntary agreement or 

20 plan of action is necessary to meet national defense re21 quirements resulting from an event that degrades or de22 stroys critical infrastructure— 

23 ‘‘(A) an individual that has been delegated au24 thority under paragraph (1) with respect to such 

25 agreement or plan shall not be required to consult 


jbell on DSKDVH8Z91PROD with BILLS
35 

•S 1677 CPS

1 with the Attorney General or the Federal Trade 

2 Commission under paragraph (2)(B); and 

3 ‘‘(B) the President shall publish a rule in ac4 cordance with subsection (e)(2)(B) and publish no5 tice in accordance with subsection (e)(3)(B) with re6 spect to such agreement or plan as soon as is prac7 ticable under the circumstances.’’; 

8 (2) in subsection (f)(2)— 

9 (A) by striking ‘‘two years’’ each place 

10 that term appears and inserting ‘‘5 years’’; and 

11 (B) by striking ‘‘two-year’’ and inserting 

12 ‘‘5-year’’; and 

13 (3) by striking subsection (n) and inserting the 

14 following: 

15 ‘‘(n) EXEMPTION FROM ADVISORY COMMITTEE ACT

16 PROVISIONS.—Notwithstanding any other provision of 

17 law, the Federal Advisory Committee Act (5 U.S.C. App.) 

18 and any other provision of Federal law relating to advisory 

19 committees shall not apply to— 

20 ‘‘(1) the consultations referred to in subsection 

21 (c)(1); or 

22 ‘‘(2) any activity conducted under a voluntary 

23 agreement or plan of action approved pursuant to 

24 this section that complies with the requirements of 

25 this section.’’. 


jbell on DSKDVH8Z91PROD with BILLS
36 

•S 1677 CPS

1 SEC. 10. EMPLOYMENT OF PERSONNEL; APPOINTMENT 

2 POLICIES; NUCLEUS EXECUTIVE RESERVE; 

3 USE OF CONFIDENTIAL INFORMATION BY EM4 PLOYEES; PRINTING AND DISTRIBUTION OF 

5 REPORTS. 

6 Section 710 of the Defense Production Act of 1950 

7 (50 U.S.C. App. 2160) is amended— 

8 (1) in subsection (b)— 

9 (A) in paragraph (2), by striking clause 

10 (iii); 

11 (B) by striking paragraph (4); 

12 (C) by redesignating paragraphs (5) 

13 through (8) as paragraphs (4) through (7), re14 spectively; and 

15 (D) in paragraph (6), as so redesignated, 

16 by striking ‘‘At least’’ and all that follows 

17 through ‘‘survey’’ and inserting ‘‘The Director 

18 of the Office of Personnel Management shall 

19 carry out a biennial survey of’’; 

20 (2) in subsection (c), by striking the third sen21 tence; 

22 (3) in subsection (d), by striking ‘‘needed;’’ and 

23 all that follows through the period and inserting 

24 ‘‘needed.’’; and 

25 (4) in subsection (e)— 


jbell on DSKDVH8Z91PROD with BILLS
37 

•S 1677 CPS

1 (A) in the first sentence, by striking 

2 ‘‘emergency’’ and inserting ‘‘national defense 

3 emergency, as determined by the President’’; 

4 and 

5 (B) by striking the third sentence. 

6 SEC. 11. DEFENSE PRODUCTION ACT COMMITTEE. 

7 Section 722 of the Defense Production Act of 1950 

8 (50 U.S.C. App. 2171) is amended to read as follows: 

9 ‘‘SEC. 722. DEFENSE PRODUCTION ACT COMMITTEE. 

10 ‘‘(a) COMMITTEE ESTABLISHED.—There is estab11 lished the Defense Production Act Committee (in this sec12 tion referred to as the ‘Committee’), which shall advise 

13 the President on the effective use of the authority under 

14 this Act by the departments, agencies, and independent 

15 establishments of the Federal Government to which the 

16 President has delegated authority under this Act. 

17 ‘‘(b) MEMBERSHIP.— 

18 ‘‘(1) IN GENERAL.—The members of the Com19 mittee shall be— 

20 ‘‘(A) the head of each Federal agency to 

21 which the President has delegated authority 

22 under this Act; and 

23 ‘‘(B) the Chairperson of the Council of 

24 Economic Advisors. 


jbell on DSKDVH8Z91PROD with BILLS
38 

•S 1677 CPS

1 ‘‘(2) CHAIRPERSON.—The President shall des2 ignate 1 member of the Committee as the Chair3 person of the Committee. 

4 ‘‘(c) EXECUTIVE DIRECTOR.— 

5 ‘‘(1) IN GENERAL.—The President shall ap6 point an Executive Director of the Defense Produc7 tion Act Committee (in this section referred to as 

8 the ‘Executive Director’), who shall— 

9 ‘‘(A) be responsible to the Chairperson of 

10 the Committee; and 

11 ‘‘(B) carry out such activities relating to 

12 the Committee as the Chairperson may deter13 mine. 

14 ‘‘(2) APPOINTMENT.—The appointment by the 

15 President shall not be subject to the advice and con16 sent of the Senate. 

17 ‘‘(3) COMPENSATION.—For pay periods begin18 ning on or after the date on which each Chairperson 

19 is appointed, funds for the pay of the Executive Di20 rector shall be paid from appropriations to the sala21 ries and expenses account of the department or 

22 agency of the Chairperson of the Committee. The 

23 Executive Director shall be compensated at a rate of 

24 pay equivalent to that of a Deputy Assistant SecVerDate Nov 24 2008 01:11 Sep 17, 2009 Jkt 079200 PO 00000 Frm 00038 Fmt 6652 Sfmt 6201 E:\BILLS\S1677.CPS S1677

jbell on DSKDVH8Z91PROD with BILLS
39 

•S 1677 CPS

1 retary (or a comparable position) of the Federal 

2 agency of the Chairperson of the Committee. 

3 ‘‘(d) REPORT.—Not later than the end of the first 

4 quarter of each calendar year, the Committee shall submit 

5 to the Committee on Banking, Housing, and Urban Af6 fairs of the Senate and the Committee on Financial Serv7 ices of the House of Representatives a report signed by 

8 each member of the Committee that contains— 

9 ‘‘(1) a review of the authority under this Act of 

10 each department, agency, or independent establish11 ment of the Federal Government to which the Presi12 dent has delegated authority under this Act; 

13 ‘‘(2) recommendations for the effective use of 

14 the authority described in paragraph (1) in a man15 ner consistent with the statement of policy under 

16 section 2(b); 

17 ‘‘(3) recommendations for legislation, regula18 tions, executive orders, or other action by the Fed19 eral Government necessary to improve the use of the 

20 authority described in paragraph (1); and 

21 ‘‘(4) recommendations for improving informa22 tion sharing between departments, agencies, and 

23 independent establishments of the Federal Govern24 ment relating to all aspects of the authority de25 scribed in paragraph (1). 


jbell on DSKDVH8Z91PROD with BILLS
40 

•S 1677 CPS

1 ‘‘(e) FEDERAL ADVISORY COMMITTEE ACT.—The 

2 provisions of the Federal Advisory Committee Act (5 

3 U.S.C. App.) shall not apply to the Committee.’’. 

4 SEC. 12. ANNUAL REPORT ON IMPACT OF OFFSETS. 

5 (a) ANNUAL REPORT.—Title VII of the Defense Pro6 duction Act of 1950 (50 U.S.C. App. 2151 et seq.) is 

7 amended by adding at the end the following: 

8 ‘‘SEC. 723. ANNUAL REPORT ON IMPACT OF OFFSETS. 

9 ‘‘(a) REPORT REQUIRED.— 

10 ‘‘(1) IN GENERAL.—The President shall submit 

11 to the Committee on Banking, Housing, and Urban 

12 Affairs of the Senate and the Committee on Finan13 cial Services of the House of Representatives, a de14 tailed annual report on the impact of offsets on the 

15 defense preparedness, industrial competitiveness, 

16 employment, and trade of the United States. 

17 ‘‘(2) DUTIES OF THE SECRETARY OF COM18 MERCE.—The Secretary of Commerce (hereafter in 

19 this subsection referred to as the ‘Secretary’) shall— 

20 ‘‘(A) prepare the report required by para21 graph (1); 

22 ‘‘(B) consult with the Secretary of De23 fense, the Secretary of the Treasury, the Sec24 retary of State, and the United States Trade 


jbell on DSKDVH8Z91PROD with BILLS
41 

•S 1677 CPS

1 Representative in connection with the prepara2 tion of such report; and 

3 ‘‘(C) function as the President’s Executive 

4 Agent for carrying out this section. 

5 ‘‘(b) INTERAGENCY STUDIES AND RELATED DATA.— 

6 ‘‘(1) PURPOSE OF REPORT.—Each report re7 quired under subsection (a) shall identify the cumu8 lative effects of offset agreements on— 

9 ‘‘(A) the full range of domestic defense 

10 productive capability (with special attention 

11 paid to the firms serving as lower-tier sub12 contractors or suppliers); and 

13 ‘‘(B) the domestic defense technology base 

14 as a consequence of the technology transfers as15 sociated with such offset agreements. 

16 ‘‘(2) USE OF DATA.—Data developed or com17 piled by any agency while conducting any inter18 agency study or other independent study or analysis 

19 shall be made available to the Secretary to facilitate 

20 the execution of the Secretary’s responsibilities with 

21 respect to trade offset and countertrade policy devel22 opment. 

23 ‘‘(c) NOTICE OF OFFSET AGREEMENTS.— 

24 ‘‘(1) IN GENERAL.—If a United States firm en25 ters into a contract for the sale of a weapon system 


jbell on DSKDVH8Z91PROD with BILLS
42 

•S 1677 CPS

1 or defense-related item to a foreign country or for2 eign firm and such contract is subject to an offset 

3 agreement exceeding $5,000,000 in value, such firm 

4 shall furnish to the official designated in the regula5 tions promulgated pursuant to paragraph (2) infor6 mation concerning such sale. 

7 ‘‘(2) REGULATIONS.—The information to be 

8 furnished under paragraph (1) shall be prescribed in 

9 regulations promulgated by the Secretary. Such reg10 ulations shall provide protection from public disclo11 sure for such information, unless public disclosure is 

12 subsequently specifically authorized by the firm fur13 nishing the information. 

14 ‘‘(d) CONTENTS OF REPORT.— 

15 ‘‘(1) IN GENERAL.—Each report under sub16 section (a) shall include— 

17 ‘‘(A) a net assessment of the elements of 

18 the industrial base and technology base covered 

19 by the report; 

20 ‘‘(B) recommendations for appropriate re21 medial action under the authority of this Act, 

22 or other law or regulations; 

23 ‘‘(C) a summary of the findings and rec24 ommendations of any interagency studies conVerDate Nov 24 2008 01:11 Sep 17, 2009 Jkt 079200 PO 00000 Frm 00042 Fmt 6652 Sfmt 6201 E:\BILLS\S1677.CPS S1677

jbell on DSKDVH8Z91PROD with BILLS
43 

•S 1677 CPS

1 ducted during the reporting period under sub2 section (b); 

3 ‘‘(D) a summary of offset arrangements 

4 concluded during the reporting period for which 

5 information has been furnished pursuant to 

6 subsection (c); and 

7 ‘‘(E) a summary and analysis of any bilat8 eral and multilateral negotiations relating to 

9 the use of offsets completed during the report10 ing period. 

11 ‘‘(2) ALTERNATIVE FINDINGS OR REC12 OMMENDATIONS.—Each report required under this 

13 section shall include any alternative findings or rec14 ommendations offered by any departmental Sec15 retary, agency head, or the United States Trade 

16 Representative to the Secretary. 

17 ‘‘(e) UTILIZATION OF ANNUAL REPORT IN NEGOTIA18 TIONS.—The findings and recommendations of the reports 

19 required by subsection (a), and any interagency reports 

20 and analyses shall be considered by representatives of the 

21 United States during bilateral and multilateral negotia22 tions to minimize the adverse effects of offsets.’’. 

23 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 

24 (1) DEFENSE PRODUCTION ACT AMENDMENTS

25 OF 1992.—Section 123(c)(1)(C) of the Defense ProVerDate Nov 24 2008 01:11 Sep 17, 2009 Jkt 079200 PO 00000 Frm 00043 Fmt 6652 Sfmt 6201 E:\BILLS\S1677.CPS S1677

jbell on DSKDVH8Z91PROD with BILLS
44 

•S 1677 CPS

1 duction Act Amendments of 1992 (50 U.S.C. App. 

2 2099 note) is amended by striking ‘‘section 309(a) 

3 of the Defense Production Act of 1950 (50 U.S.C. 

4 App. 2099(a))’’ and inserting ‘‘section 723(a) of the 

5 Defense Production Act of 1950’’. 

6 (2) AMERICAN HOMEOWNERSHIP AND ECO7 NOMIC OPPORTUNITY ACT OF 2000.—Section 1102(2) 

8 of the American Homeownership and Economic Op9 portunity Act of 2000 (31 U.S.C. 1113 note) is 

10 amended by striking ‘‘309 of the Defense Production 

11 Act of 1950 (50 U.S.C. App. 2099)’’ and inserting 

12 ‘‘723 of the Defense Production Act of 1950’’. 

13 (3) DEFENSE PRODUCTION ACT AMENDMENTS

14 OF 2003.—Section 7(a) of the Defense Production 

15 Act Amendments of 2003 (50 U.S.C. App. 2099 

16 note) is amended by striking ‘‘section 309(a) of the 

17 Defense Production Act of 1950 (50 U.S.C. App. 

18 2099(a))’’ and inserting ‘‘section 723(a) of the De19 fense Production Act of 1950’’. 

Æ 


jbell on DSKDVH8Z91PROD with BILLS