Agencies Are Getting Better at Using the Defense Production Act for Pandemic Response

Agencies are making better use of a Korean War-era law to speed up production of coronavirus supplies and vaccines, a recent Government Accountability Office report shows. This finding comes as the White House plans to step up use of the law’s provisions to combat the omicron variant. 

The 1950 Defense Production Act allows federal agencies to direct companies to prioritize government contracts to respond to national emergencies, in this case the pandemic. President Trump was criticized early on for not taking advantage of the authorities conferred by the law. However, Trump ultimately used the law to prioritize certain contracts, fund expansion of domestic supply production and enter into partnerships with private companies—actions the Biden administration has continued. 

In a report published December 16, the Government Accountability Officenoted that federal agencies—specifically the Health and Human Services and Defense departments and Federal Emergency Management Agency—faced challenges using DPA authorities to boost manufacturing of COVID-19 medical supplies and vaccines. However, the agencies “have taken some steps to address these obstacles,” in addition to addressing some of GAO’s recommendations for improvement, the watchdog reported. 

For example, HHS––which had limited experience with the law before the pandemic––established a DPA office within the Office of the Assistant Secretary for Preparedness and Response in June 2020 and an industrial base expansion program office in September.

However, “As of September 30, 2021, HHS had not provided us with information about the staffing for these organizations,” the watchdog noted. Also, HHS “has not developed a plan for using DPA and other actions to address future medical supply needs as GAO recommended.” 

The Defense Department, which has been providing significant contracting support to HHS, signed a memorandum of understanding with HHS in May 2021 to reduce HHS’s reliance on the Pentagon. Agency officials told GAO that progress in implementing the memo has been delayed due to the recent COVID-19 surges, among other reasons. 

Another improvement by the Defense Department was that in October 2020 it made permanent an office to support interagency acquisition efforts, said GAO. 

FEMA has also worked to enhance its DPA expertise after a January 2021 self-assessment found the agency did not have enough personnel sufficiently trained on using the law’s authorities. 

“The team was given 26 additional federal employees from DOD, HHS, and FEMA during the COVID-19 response, but only some were familiar with DPA authorities and many required DPA training,” the report noted. “As of October 2021, FEMA officials stated that 10 FEMA employees have been identified to offer surge support to the DPA office in a future emergency. FEMA has also started discussions with other federal agencies to establish memoranda of agreement for interagency staffing support.” 

Another area of progress GAO noted was that in July 2021, the Office of Management and Budget created a website to collect and publish data on DPA priority ratings on contracts for items most needed. This addressed a previous GAO recommendation, which was aimed at promoting transparency, the report noted. 

“Additional DPA and other actions are expected through 2025 as agencies use $10 billion appropriated in the American Rescue Plan Act for medical supply investments and implement a September 2021 national strategy to strengthen the domestic medical industrial base,” said the report. “GAO plans to monitor agencies’ efforts.” 

On Tuesday afternoon, President Biden outlined further actions his administration is taking this winter to combat the pandemic, particularly the rapidly spreading omicron variant. 

One of the provisions: “The president is pledging to continue using the Defense Production Act and other authorities to make sure the U.S. is producing as many tests as quickly as possible,” said a fact-sheet from the White House. Just in the past week, the administration has used the law to allow “one company to double its production of lab-based tests, and another to rapidly scale up production of new over-the-counter and point-of-care tests.”