[Congressional Record Volume 171, Number 133 (Friday, August 1, 2025)]
[Senate]
[Pages S5450-S5451]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SA 3647. Mr. HAGERTY (for himself and Mr. Kaine) submitted an
amendment intended to be proposed by him to the bill S. 2296, to
authorize appropriations for fiscal year 2026 for military activities
of the Department of Defense, for military construction, and for
defense activities of the Department of Energy, to prescribe military
personnel strengths for such fiscal year, and for other purposes; which
was ordered to lie on the table; as follows:
At the appropriate place, insert the following:
SEC. __. MODERNIZING THE DEFENSE CAPABILITIES OF THE
PHILIPPINES.
(a) Purpose.--In addition to the purposes otherwise
authorized for Foreign Military Financing with respect to the
Philippines, the Secretary of State shall use the authorities
under this section to--
(1) strengthen the United States-Philippines alliance in
accordance with the historic agreement reached at the United
States-Philippines 2+2 Ministerial Dialogue on August 2,
2024;
(2) enable the acceleration of phase three of the
modernization of the Armed Forces of the Philippines;
(3) provide additional information to the Chairs of the
United States-Philippine Bilateral Security Dialogue to
enable planning and prioritization of Joint Capability Areas
(JCA);
(4) support the execution of the Philippines-Security
Sector Assistance Roadmap (P-SSAR); and
(5) provide assistance, including equipment, training, and
other support, to modernize the defense capabilities of the
Armed Forces of the Philippines in order to--
(A) safeguard the territorial sovereignty of the
Philippines;
(B) improve maritime domain awareness;
(C) counter coercive military activities;
(D) improve the military and civilian infrastructure and
capabilities necessary to prepare for regional contingencies;
and
(E) strengthen cooperation between the United States and
the Philippines on counterterrorism-related efforts.
(b) Annual Spending Plan.--Not later than March 1, 2026,
and annually thereafter for a period of 4 years, the
Secretary of State, in coordination with the Secretary of
Defense, shall submit to the appropriate congressional
committees a plan describing how amounts authorized to be
appropriated pursuant to subsection (e), if made available,
would be used to achieve the purpose described in subsection
(a).
(c) Annual Report on Enhancing the United States-
Philippines Defense Relationship.--
(1) Report required.--Not later than 270 days after the
date of the enactment of this Act, and annually thereafter
for a period of 4 years, the Secretary of State, in
consultation with the Secretary of Defense, and in
consultation with such other heads of Federal departments and
agencies as the Secretary of State considers appropriate,
shall submit to the appropriate congressional committees a
report that describes steps taken to enhance the United
States-Philippines defense relationship.
(2) Matters to be included.--Each report required under
paragraph (1) shall include the following:
(A) A description of the capabilities and defense
infrastructure improvements needed to modernize the defense
capabilities of the Philippines, including with respect to--
(i) coastal defense;
(ii) long-range fires;
(iii) integrated air defenses;
(iv) maritime security;
(v) manned and unmanned aerial systems;
(vi) mechanized ground mobility vehicles;
(vii) intelligence, surveillance, and reconnaissance;
(viii) defensive cybersecurity;
(ix) military construction;
(x) maintenance and sustainment of military capabilities;
and
(xi) any other defense capabilities that the Secretary of
State determines, including jointly with the Philippines, are
crucial to the defense of the Philippines.
(B) An assessment of the absorptive capacity of the Armed
Forces of the Philippines, including the coast guard, over
the next 5 years.
(C) A description of how statutory authorities under title
10, United States Code, including under section 333 of such
title and authorities relating to unspecified minor military
construction and overseas humanitarian, disaster, and civic
aid, will be used to provide support for the Philippines-
Security Sector Assistance Roadmap and the defense
capabilities described in subparagraph (A),
[[Page S5451]]
prioritized according to the assessment of the absorptive
capacity of the Armed Forces of the Philippines required
under subparagraph (B).
(3) Form.--Each report required under paragraph (1) shall
be submitted in unclassified form, but may contain a
classified annex.
(d) Foreign Military Financing Loan and Loan Guarantee
Authority.--
(1) Direct loans.--
(A) In general.--During fiscal years 2026 through 2030, the
Secretary of State may make direct loans available for the
Philippines pursuant to section 23 of the Arms Export Control
Act (22 U.S.C. 2763).
(B) Maximum obligations.--Gross obligations for the
principal amounts of loans authorized under subparagraph (A)
may not exceed $1,000,000,000.
(C) Source of funds.--
(i) Defined term.--In this subparagraph, the term
``cost''--
(I) has the meaning given such term in section 502(5) of
the Congressional Budget Act of 1974 (2 U.S.C. 661a(5));
(II) shall include the cost of modifying a loan authorized
under subparagraph (A); and
(III) may include the costs of selling, reducing, or
cancelling any amounts owed to the United States or to any
agency of the United States.
(ii) In general.--Funds made available under the
appropriations heading ``Foreign Military Financing Program''
in any Act making appropriations for the Department of State,
Foreign Operations, and Related Programs may be made
available to pay for the cost of loans authorized under
subparagraph (A).
(D) Fees authorized.--
(i) In general.--The Government of the United States may
charge processing and origination fees for a loan made
pursuant to subparagraph (A), not to exceed the cost to the
Government of making such loan, which shall be collected from
borrowers through a financing account (as defined in section
502(7) of the Congressional Budget Act of 1974 (2 U.S.C.
661a(7)).
(ii) Limitation on fee payments.--Amounts made available
under any appropriations Act for any fiscal year may not be
used to pay any fees associated with a loan authorized under
subparagraph (A).
(E) Repayment.--Loans made pursuant to subparagraph (A)
shall be repaid not later than 17 years after the loan is
received by the borrower, including a grace period of not
more than 1 year on repayment of principal.
(F) Interest.--
(i) In general.--Notwithstanding section 23(c)(1) of the
Arms Export Control Act (22 U.S.C. 2763(c)(1)), interest for
loans made pursuant to subparagraph (A) may be charged at a
rate determined by the Secretary of State.
(ii) Treatment of loan amounts used to pay interest.--
Amounts made available under this paragraph for interest
costs shall not be considered assistance for the purposes of
any statutory limitation on assistance to a country.
(2) Loan guarantees.--
(A) In general.--Funds made available under the
appropriations heading ``Foreign Military Financing Program''
in any Act making appropriations for the Department of State,
Foreign Operations, and Related Programs may be made
available for the costs of loan guarantees for the
Philippines under section 24 of the Arms Export Control Act
(22 U.S.C. 2764) for the Philippines to subsidize gross
obligations for the principal amount of commercial loans and
total loan principal, any part of which may be guaranteed.
(B) Maximum amounts.--Loan guarantees authorized under
subparagraph (A)--
(i) may be made only to the extent that the total loan
principal, any part of which is guaranteed, does not exceed
$1,000,000,000; and
(ii) may not exceed 80 percent of the loan principal with
respect to any single borrower.
(C) Subordination.--Any loan guaranteed pursuant to
subparagraph (A) may not be subordinated to--
(i) another debt contracted by the borrower; or
(ii) any other claims against the borrower in the case of
default.
(D) Repayment.--Repayment in United States dollars of any
loan guaranteed under this paragraph shall be required not
later than 17 years after the loan agreement is signed.
(E) Fees.--Notwithstanding section 24 of the Arms Export
Control Act (22 U.S.C. 2764), the Government of the United
States may charge processing and origination fees for a loan
guarantee authorized under subparagraph (A), not to exceed
the cost to the Government of such loan guarantee, which
shall be collected from borrowers, or from third parties on
behalf of such borrowers, through a financing account (as
defined in section 502(7) of the Congressional Budget Act of
1974 (2 U.S.C. 661a(7)).
(F) Treatments of loan guarantees.--Amounts made available
under this paragraph for the costs of loan guarantees
authorized under subparagraph (A) shall not be considered
assistance for the purposes of any statutory limitation on
assistance to a country.
(G) Commercial flexibility.--Loan guarantees authorized
under subparagraph (A) may be provided to entities doing
business inside or outside the United States, notwithstanding
any provision of the Arms Export Control Act (22 U.S.C. 2751
et seq.) that would otherwise limit eligibility for such
guarantees based on geographic location or business
operations.
(3) Notification requirement.--Amounts authorized to be
appropriated to carry out this subsection may not be expended
without prior notification of the appropriate committees of
Congress.
(e) Authorization of Appropriations.--
(1) In general.--In addition to amounts otherwise
authorized to be appropriated for Foreign Military Financing,
there is authorized to be appropriated to the Department of
State for Foreign Military Financing grant assistance for the
Philippines up to $500,000,000 for each of fiscal years 2026
through 2030.
(2) Training.--Of the amounts authorized to be appropriated
pursuant to paragraph (1), the Secretary of State shall
obligate and expend not less than $500,000 each fiscal year
for one or more blanket order agreements for Foreign Military
Financing training programs related to the defense needs of
the Philippines.
(f) Sunset Provision.--Assistance may not be provided under
this section after September 30, 2035.
(g) Definitions.--In this section:
(1) Appropriate congressional committees.--The term
``appropriate congressional committees'' means--
(A) the Committee on Foreign Relations, the Committee on
Armed Services, and the Committee on Appropriations of the
Senate; and
(B) the Committee on Foreign Affairs, the Committee on
Armed Services, and the Committee on Appropriations of the
House of Representatives.
(2) Blanket order agreement.--The term ``blanket order
agreement'' means an agreement between a foreign customer and
the United States Government for a specific category of items
or services (including training) that--
(A) does not include a definitive list of items or
quantities; and
(B) specifies a dollar ceiling against which orders may be
placed.
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