defense

Pentagon redirected pandemic funds to defense contractors

The Pentagon redirected most of its $1 billion in pandemic funding to defense contractors who exchanged the money for jet engine parts, body armor, dress uniforms and other military needs, The Washington Post reported on Tuesday.



Pentagon redirected pandemic funds to defense contractors


© Greg Nash
Pentagon redirected pandemic funds to defense contractors

The CARES Act passed by Congress in March granted the Department of Defense $1 billion to both prevent and get ready to respond to the coronavirus, but the Post reported that in the weeks that followed, hundreds of millions of the taxpayer money was instead utilized to obtain military supplies.

This was a change from the intent of Congress, the Post noted.

Meanwhile, U.S. health officials are still requesting funding for pandemic response, including $6 billion for states to make vaccines available when they are developed and to address a shortage in N95 masks for hospitals. The Pentagon has also requested that $11 billion be provided in a potential new stimulus bill being debated by Congress.

Congress instructed the $1 billion in the CARES Act to go to Defense Production Act (DPA) efforts, which permits President Trump to direct U.S. companies to manufacture necessary products, such as personal protective equipment (PPE).

Months after the funding was allocated, department lawyers concluded the money could be used for defense production, including projects that had little to do with responding to the pandemic, the Post reported. Smaller firms received more than a third of the funding for less than $5 million, but hundreds of millions of dollars went to several large companies.

At least 10 of the about 30 contractors awarded with DPA funding also received money from the Paycheck Protection Program (PPP), the Post found.

Jessica Maxwell, a spokesperson for the Department of Defense, told The Hill in a statement that the DPA funding and

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Outrage follows as Pentagon funnels millions meant for COVID supplies to private defense contractors

Donald Trump
Donald Trump

US President Donald Trump tours a Honeywell International Inc. factory producing N95 masks during his first trip since widespread COVID-19 related lockdowns went into effect May 5, 2020, in Phoenix, Arizona. BRENDAN SMIALOWSKI/AFP/Getty Images

Instead of adhering to congressional intent by building up the nation’s inadequate supply of N95 masks and other equipment to combat the Covid-19 crisis, the Pentagon has funneled hundreds of millions of dollars in appropriated taxpayer funds to private defense contractors for drone technology, jet engine parts, Army uniform material, body armor, and other purposes not directly related to the pandemic.

As the Washington Post reported Tuesday morning, the Department of Defense—headed by former Raytheon lobbyist Mark Esper—”began reshaping how it would award the money” just weeks after Congress in March approved a $1 billion fund under the Defense Production Act to help the nation “prevent, prepare for, and respond to coronavirus.”

“The Trump administration has done little to limit the defense firms from accessing multiple bailout funds at once and is not requiring the companies to refrain from layoffs as a condition of receiving the awards,” the Post noted. “Some defense contractors were given the Pentagon money even though they had already dipped into another pot of bailout funds, the Paycheck Protection Program.”

As the U.S. still faces major shortages of testing supplies and N95 masks six months into the pandemic, the Post reported that the Pentagon has used congressionally approved funds to dish out $183 million to luxury carmaker Rolls-Royce and other companies to help “maintain the shipbuilding industry,” tens of millions for “drone and space surveillance technology,” and $80 million to “a Kansas aircraft parts business.”

A subsidiary of Rolls-Royce also received $22 million from the Pentagon “to upgrade a Mississippi plant,” according to the Post.

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The Facility Security Clearance – How Defense Contractors Get Clearances

Before a defense contractor can perform on a classified contact, it must be approved for a security clearance. You might familiar with security clearances for people, but defense contractor facilities must also be approved for security clearances called a facility clearance (FCL). Having an FCL doesn’t mean that a particular building is approved for a clearance, but rather the determination is based on the entity. For example, a defense contractor facility may be a sole proprietorship, a limited liability company, corporation, university or other recognized establishment. It is the organization itself and not the building that gets the clearance.

A company cannot process itself for a clearance. The clearance is based on a legitimate classified contract from either a government entity or other prime contractor. A company can bid on a classified contract even if it does not possess an FCL. However, it must receive the FCL prior to beginning to work on the classified contract.

When a defense contractor has a legitimate need for a clearance, it is sponsored by the awarding government agency or prime contractor. This sponsorship begins the process of the clearance request. The sponsoring organization notifies Defense Security Services (DSS) who works with the defense contractor to complete the requirements for an FCL. To be eligible for a clearance, the defense contractor facility must first have a good reputation for doing business and be in good standing. DSS will research and evaluate the company. Meanwhile, the candidate company works with DSS to provide four remaining requirements.

SECURITY AGREEMENTS

A security agreement (DD Form 441) must be signed. This agreement describes the responsibilities that both the contractor and government have to protect classified information. For example, in the security agreement the government agrees to provide security clearances and the contractor agrees to follow the National Industrial …

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