I 117th CONGRESS 2d Session H. R. 8470 IN THE HOUSE OF REPRESENTATIVES July 21, 2022 Ms. Houlahan (for herself and Mr. Fallon ) introduced the following bill; which was referred to the Committee on Armed Services A BILL To establish a public-private partnership technology investment pilot program.

1. Short title This Act may be cited as the Investing in American Defense Technologies Act of 2022 . 2. Public-private partnership technology investment pilot program (a) Establishment (1) In general Subject to the availability of appropriations for this purpose, the Secretary of Defense shall carry out a pilot program, for no less than five years, to accelerate the development of advanced technology for national security by creating incentives for trusted private capital to invest in domestic small businesses or nontraditional businesses that are developing technology that the Secretary considers necessary to support the modernization of the Department of Defense and national security priorities. (2) Purposes The purposes of the program required by paragraph (1) are as follows: (A) To promote the global superiority of the United States in advanced technologies of importance to national security, which are not adequately supported by private sector investment. (B) To accelerate the transition and deployment of advanced technologies into the Armed Forces. (C) To support Department investment through a loan guarantee to accelerate acquisition, procurement, and the transition of advance technology described in paragraph (1), as appropriate. (b) Public-Private partnership (1) In general In carrying out subsection (a), the Secretary shall enter into a public-private partnership with one or more persons using criteria that the Secretary shall establish for purposes of this subsection. (2) Criteria The criteria established under paragraph (1) for entering into a public-private partnership with a person shall include the following: (A) The person shall be independent. (B) The person shall be free from foreign oversight, control, influence, or beneficial ownership. (C) The person shall have commercial private capital fund experience with technology development in the defense and commercial sectors. (D) The person shall be eligible for access to classified information (as defined in the procedures established pursuant to section 801(a) of the National Security Act of 1947 ( 50 U.S.C. 3161(a) )). (3) Operating agreement The Secretary and a person with whom the Secretary enters a partnership under paragraph (1) shall enter into an operating agreement that sets forth the roles, responsibilities, authorities, reporting requirements, and governance framework for the partnership and its operations. (c) Investment and raising of capital (1) Investment (A) In general Pursuant to a public-private partnership entered into under subsection (b), a person with whom the Secretary has entered the partnership shall invest equity in domestic small businesses or nontraditional businesses consistent with subsection (a). (B) Selection criteria Investments under subparagraph (A) shall be selected based on their technical merit, economic considerations, and ability to support modernization goals of the Department. (2) Use of trusted capital sources Pursuant to a public-private partnership entered into under subsection (b), a person described in paragraph (1)(A) shall, in order to support investment of equity under paragraph (1), raise private capital only from trusted capital sources. (3) Sole authority A person described in paragraph (1)(A) shall have sole authority to raise funds for, operate, manage, and invest capital raised under such subparagraph. (4) Loan guarantee (A) In general The Secretary shall provide a loan guarantee for up to 80 percent of the principal capital amount of the funds raised under paragraph (2), pursuant to the public-private partnership entered into under subsection (b), with investment of equity that qualifies under paragraph (1) and consistent with the purposes set forth under subsection (a)(2). (B) Subject to operating agreement The loan guarantee under subparagraph (A) shall be subject to the operating agreement entered into under subsection (b)(3). (C) Limits Obligations incurred by the Secretary under this paragraph shall be subject to the availability of appropriations. (d) Briefings (1) Implementation Not later than one year after the date of the enactment of this section, the Secretary shall provide to the congressional defense committees a briefing on the implementation of this section. (2) Assessment of outcomes and feasibility Not later than five years after the date of the enactment of this section, the Secretary shall provide the congressional defense committees a briefing on the outcomes of the pilot program and the feasibility and advisability of making it permanent. (e) Definitions In this section: (1) The term congressional defense committees has the meaning given the term in section 101(a)(16) of title 10, United States Code. (2) The term domestic business has the meaning given the term U.S. business in section 800.252 of title 31, Code of Federal Regulations, or successor regulation. (3) The term domestic small businesses or nontraditional businesses means— (A) a small businesses that is a domestic business; or (B) a nontraditional business that is a domestic business. (4) The term free from foreign oversight, control, influence, or beneficial ownership , with respect to a person, means a person who has not raised and managed capital from a person or entity that is not trusted and is otherwise free from foreign oversight, control, influence, or beneficial ownership. (5) The term independent , with respect to a person, means a person who lacks a conflict of interest accomplished by not having entity or manager affiliation or ownership with an existing fund. (6) The term nontraditional business has the meaning given the term nontraditional defense contractors in section 3014 of title 10, United States Code. (7) The term small business has the meaning given the term small business concern in section 3 of the Small Business Act ( 15 U.S.C. 632 ).