[Senate Report 117-269]
[From the U.S. Government Publishing Office]
Calendar No. 668
117th Congress } { Report
SENATE
2d Session } { 117-269
______________________________________________________________________
MAKE PPE IN AMERICA ACT
__________
R E P O R T
of the
COMMITTEE ON HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
to accompany
S. 1306
TO PROVIDE FOR DOMESTIC SOURCING OF PERSONAL
PROTECTIVE EQUIPMENT, AND FOR OTHER PURPOSES
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
December 19, 2022.--Ordered to be printed
______
U.S. GOVERNMENT PUBLISHING OFFICE
39-010 WASHINGTON : 2023
COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
GARY C. PETERS, Michigan, Chairman
THOMAS R. CARPER, Delaware ROB PORTMAN, Ohio
MAGGIE HASSAN, New Hampshire RON JOHNSON, Wisconsin
KYRSTEN SINEMA, Arizona RAND PAUL, Kentucky
JACKY ROSEN, Nevada JAMES LANKFORD, Oklahoma
ALEX PADILLA, California MITT ROMNEY, Utah
JON OSSOFF, Georgia RICK SCOTT, Florida
JOSH HAWLEY, Missouri
David M. Weinberg, Staff Director
Zachary I. Schram, Chief Counsel
Michelle M. Benecke, Senior Counsel
Pamela Thiessen, Minority Staff Director
Sam J. Mulopulos, Minority Deputy Staff Director
Laura W. Kilbride, Chief Clerk
Calendar No. 668
117th Congress } { Report
SENATE
2d Session } { 117-269
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MAKE PPE IN AMERICA ACT
_______
December 19, 2022.--Ordered to be printed
_______
Mr. Peters, from the Committee on Homeland Security and Governmental
Affairs, submitted the following
R E P O R T
[To accompany S. 1306]
The Committee on Homeland Security and Governmental
Affairs, to which was referred the bill (S. 1306) to provide
for domestic sourcing of personal protective equipment, and for
other purposes, having considered the same, reports favorably
thereon with an amendment, in the nature of a subsitute, and
recommends that the bill, as amended, do pass.
CONTENTS
Page
I. Purpose and Summary..............................................1
II. Background and Need for the Legislation..........................2
III. Legislative History..............................................3
IV. Section-by-Section Analysis of the Bill, as Reported.............3
V. Evaluation of Regulatory Impact..................................5
VI. Changes in Existing Law Made by the Bill, as Reported............5
I. PURPOSE AND SUMMARY
S. 1306, the ``Make PPE in America Act,'' requires certain
departments that procure personal protective equipment (PPE) to
ensure that any contracts those agencies issue for PPE are at
least two years in length, and are for PPE that is grown,
reprocessed, reused, or produced in the United States. Covered
departments include the Departments of Homeland Security (DHS),
Health and Human Services (HHS), Veterans Affairs, and Defense
(DoD). The bill provides exceptions to the two-year minimum
duration of PPE contracts and the domestic production
requirement for non-availability and for alternatives to
domestic production that the departmental secretary certifies
as necessary to meet the immediate needs of a public health
emergency. The need for use of such exceptions must be re-
certified by the departmental secretary every 120 days.
S. 1306 requires the Director of the Office of Management
and Budget (OMB), in consultation with the covered secretaries,
to submit to Congress a report on the procurement of PPE not
later than 180 days after the date of the bill's enactment. The
report must address the United States' long-term domestic
procurement strategy for PPE, including strategies to
incentivize investment in and maintenance of domestic supply
chains for PPE needed during a public health emergency. The
report must include an estimate of long-term demand for all PPE
items procured by the United States, recommendations for
congressional action needed to implement the procurement
strategy outlined in the report, and a determination as to
whether any necessary action has been completed to bring
existing United States international obligations into
conformity with the requirements of the Act.
S. 1306 authorizes a covered secretary to transfer to the
Strategic National Stockpile any excess PPE acquired under a
contract executed under the Act. The bill also allows DHS to
transfer to HHS excess PPE or medically necessary equipment
during a public health emergency, provided Congress is notified
and a determination is made that the items are excess and that
the transfer will not adversely impact DHS. The bill also
requires DHS to maintain an inventory of the Department's PPE
and make it available to HHS and Congress. The bill provides
transfer authority for the Secretary of HHS, in coordination
with the Secretary of Homeland Security, to sell drugs,
vaccines, and other biological products, medical devices, and
supplies maintained in the Stockpile, provided the items are no
longer needed and within one year of their expiration date.
II. BACKGROUND AND NEED FOR THE LEGISLATION
When confronted with the COVID-19 pandemic, the United
States quickly faced a PPE supply chain crisis. For supplies
such as gowns and gloves, domestic production was limited and
supplies were scarce.\1\ In response to this situation, the
Defense Logistics Agency (DLA) and the Joint Acquisition Task
Force (JATF) made a domestic non-availability determination
(DNAD) for PPE. The DNAD waives the normal domestic content
requirements, such as the Berry Amendment, allowing DLA/JATF to
procure PPE from anywhere in the world. While the DNAD was
necessary to meet the needs of the country's pandemic response,
it underscored a real problem: that the United States should
have more control of its PPE supply and production.
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\1\Congressional Research Service, COVID-19 and Domestic PPE
Production and Distribution: Issues and Policy Options (Dec. 7, 2020)
(https://crsreports.congress.gov/product/pdf/R/R46628); See also
Government Accountability Office, COVID-19: Federal Efforts Could Be
Strengthened by Timely and Concerted Actions (GAO-20-701) (Sep. 21,
2020).
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Long-term contracts are one option to stimulate re-shoring
and expansion of domestic PPE production. Long-term contracts
send a powerful demand signal to industry, providing confidence
that there will be an assured buyer if businesses make
investments in the United States to re-shore or expand existing
production.\2\
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\2\Brookings Institution Report, Reshoring Advanced Manufacturing
Supply Chains to Generate Good Jobs (Jul. 23, 2020) (https://
www.brookings.edu/research/reshoring-advanced-manufacturing-supply-
chains-to-generate-good-jobs/).
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III. LEGISLATIVE HISTORY
Ranking Member Rob Portman (R-OH) introduced S. 1306, the
Make PPE in America Act, on April 22, 2021, with Chairman
Peters (D-MI) as cosponsor. The bill was referred to the Senate
Committee on Homeland Security and Governmental Affairs.
The Committee considered S. 1306 at a business meeting on
May 12, 2021. During the business meeting, a substitute
amendment was offered by Ranking Member Portman and Chairman
Peters. The substitute amendment reduced the required contract
length from 3 years to 2 years and provided for exceptions to
domestic production for nonavailability, cost, and where
necessary, as certified by the relevant Secretary, to respond
to the immediate needs of a public health emergency. A
modification to the substitute amendment to provide for
transfer of PPE to the Strategic National Stockpile during a
public health emergency was adopted by voice vote en bloc. The
modified substitute amendment was then adopted by voice vote en
bloc. An amendment to the modified substitute amendment to add
the text of Senator Johnson's Securing Healthcare and Response
Equipment Act of 2020, which allows HHS and DHS to effectuate
the transfer and sale of excess PPE, medical equipment, and
supplies in the event of a public health emergency, to the bill
was then offered by Senator Johnson (R-WI) and adopted by voice
vote en bloc.
The Committee ordered the bill reported favorably by voice
vote en bloc as amended with Senators Peters, Carper, Hassan,
Sinema, Rosen, Padilla, Ossoff, Portman, Johnson, Paul,
Lankford, Romney, Scott, and Hawley present.
IV. SECTION-BY-SECTION ANALYSIS OF THE BILL, AS REPORTED
Section 1. Short title
This section provides that the bill may be cited as the
``Make PPE in America Act.''
Sec. 2. Findings
Section 2 provides that Congress makes the following
findings:
(1) The COVID-19 pandemic has exposed the vulnerability of
the United States PPE supply chain as well as a lack of
domestic production of PPE.
(2) The United States requires a robust, secure, and wholly
domestic PPE supply chain to safeguard public health and
national security.
(3) Issuing a strategy that provides the government's
anticipated PPE needs over the next 3 years will enable
suppliers to assess necessary changes to their manufacturing
capacity to meet expected demands.
(4) Industry needs a strong and consistent demand signal
from the Federal Government to provide the certainty needed for
industry to expand production capacity investment in the United
States.
(5) Long-term contracts must be no shorter than 3 years in
duration in order to effectively incentivize the investment in
the United States and re-shoring of manufacturing of PPE.
(6) The United States should seek to ensure compliance with
international obligations such as its commitments under the
World Trade Organization's Agreement on Government Procurement
and its free trade agreements, including by invoking relevant
exceptions to these agreements, especially those related to
national security and public health.
(7) The United States needs a long-term investment strategy
for domestic production of PPE critical to national response to
a public health crisis, including the COVID-19 pandemic.
Sec. 3. Requirement of long-term contracts for domestically
manufactured personal protective equipment
Subsection (a) defines ``appropriate congressional
committees,'' ``covered Secretary,'' ``personal protective
equipment,'' and ``United States.''
Subsection (b) requires that beginning 90 days after date
of enactment, the covered Secretaries of Homeland Security,
Health and Human Services, Veterans Affairs, and Defense must
issue any contract for the procurement of PPE for a duration of
at least 2 years, plus all options necessary, and that the PPE
and its materials and components be grown, reprocessed, reused
or produced in the United States.
Subsection (c) allows a covered Secretary to certify the
need to use alternatives to domestic production after
maximizing sources consistent with subsection (b) and
maximizing sources for PPE assembled outside the United States
containing materials and components that are grown,
reprocessed, reused, or produced in the United States. This
certification for use of alternative procedures to respond to
the immediate needs of a public health emergency must be made
every 120 days.
Subsection (d) provides an exception to the domestic
sourcing requirements for PPE that includes a material listed
in section 25.104 of the Federal Acquisition Regulation as one
for which a non-availability determination has been made, or
PPE for which a covered Secretary determines that a sufficient
quantity of a satisfactory quality cannot be procured when
needed at United States market prices. The covered Secretary
shall certify every 120 days that the exception is needed to
meet the immediate needs of a public health emergency.
Subsection (e) requires the Director of OMB, in
consultation with the covered Secretaries, to submit a report
to Congress within 180 days after the bill's enactment on the
procurement of PPE. The report shall include the long-term
domestic procurement strategy of the United States for PPE,
including strategies to incentivize investment in and
maintenance of domestic supply chains for PPE needed during a
public health emergency. The report shall also include an
estimate of long-term demand for all PPE items procured by the
United States, recommendations for congressional action needed
to implement the procurement strategy outlined in the report,
and a determination as to whether any necessary action has been
completed to bring existing United States international
obligations into conformity with the requirements of the Act.
Subsection (f) allows a covered Secretary to transfer to
the Strategic National Stockpile any excess PPE acquired under
a contract executed pursuant to subsection (b). The subsection
amends the Homeland Security Act of 2002 to allow the Secretary
of Homeland Security, at the request of the Secretary of Health
and Human Services, to transfer to HHS excess PPE or medically
necessary equipment during a public health emergency, provided
Congress is notified and the Secretary determines the items are
excess and certifies that the transfer will not adversely
impact the health or safety of officers, employees, or
contractors of DHS. The Secretary of Homeland Security, acting
through the Chief Medical Officer, shall maintain a required
inventory of PPE and make it available to the Secretary of
Health and Human Services and Congress.\3\ The subsection also
amends the Public Health Service Act to allow the Secretary of
Health and Human Services, in coordination with the Secretary
of Homeland Security, to sell drugs, vaccines, and other
biological products, medical devices, and supplies maintained
in the Strategic National Stockpile, provided the items are no
longer needed and are within 1 year of their expiration
date.\4\
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\3\The change to the Homeland Security Act of 2002 set forth in
subsection (f) of the bill was included in the Infrastructure
Investment and Jobs Act of 2021 (Pub. L. 117-58, Sec. 70953(f)(2),
which became law before this bill was reported out of committee. This
change in law is now moot and is not reflected in Section VII of this
report.
\4\The change to the Public Health Service Act set forth in
subsection (f) of the bill was included in the Infrastructure
Investment and Jobs Act of 2021 (Pub. L. 117-58, Sec. 70953(f)(3),
which became law before this bill was reported out of committee. This
change in law is now moot and is not reflected in Section VII of this
report.
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Subsection (g) requires the President or President's
designee to take all necessary steps, including invoking the
rights of the United States under the World Trade
Organization's Agreement on Government Procurement and relevant
exceptions under other relevant agreements, to ensure that the
international obligations of the United States are consistent
with the provisions of the Act.
V. EVALUATION OF REGULATORY IMPACT
Pursuant to the requirements of paragraph 11(b) of rule
XXVI of the Standing Rules of the Senate, the Committee has
considered the regulatory impact of this bill and determined
that the bill will have no regulatory impact within the meaning
of the rules. The Committee agrees with the Congressional
Budget Office's statement that the bill contains no
intergovernmental or private-sector mandates as defined in the
Unfunded Mandates Reform Act (UMRA) and would impose no costs
on state, local, or tribal governments.
VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
The changes in law set forth in this bill were included in
the Infrastructure Investment and Jobs Act of 2021 (Pub. L.
117-58, Sec. 70953(f)), which became law before this bill was
reported out of committee. These changes in law are now moot
and therefore are not reflected in this section. The bill as
enacted did not include the Secretary of Defense in the
definition of the term ``covered Secretary'' set forth in
Section 3(a) of the substitute amendment reported out of
Committee; the inclusion of the Secretary of Defense in the
definition will not be enacted.
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