What changed between these versions
A substantive reauthorization and modernization. v2 extends the Defense Production Act's expiration date by five years, establishes a National Defense Executive Reserve, and significantly expands reporting and oversight requirements for the DPA Committee and CFIUS, particularly regarding agricultural land transactions and equity investments. Several appropriations amounts and fiscal years are also updated.
Overview
Extensive changes are present throughout the bill, encompassing numerous modifications to existing provisions, several significant additions of new policy, and a few key deletions. · v2 expands the DPA's reauthorization period, enhances transparency and oversight, broadens the scope of certain authorities (like CFIUS), and introduces new mechanisms for national defense preparedness, while also clarifying and streamlining some administrative processes.
v2 extends the reauthorization of key DPA authorities from 2026 to 2031 and establishes a National Defense Executive Reserve to improve emergency preparedness. It significantly enhances Congressional oversight by adding new reporting requirements for equity investments, agricultural land transactions reviewed by CFIUS, and the overall DPA strategy. Additionally, v2 broadens the definition of 'national defense' and updates various appropriation amounts and fiscal years, while also removing a special hiring authority and a provision on penalties for unauthorized disclosure.
Major additions
This new section, 'FRONT MATTER', includes a correction to the short title of the Defense Production Act of 1950 and updates the table of contents to reflect the renumbering of titles within the Act.
This addition is primarily structural and technical, ensuring consistency in the Act's citation and providing an accurate navigational guide for the renumbered titles. It does not introduce new policy but facilitates the understanding of the bill's structural changes.
This new paragraph requires the Defense Production Act Committee to include a description, rationale, and valuation of any equity held by the Government pursuant to the Act's authorities in its annual report.
This significantly increases transparency and oversight regarding government equity investments made under the DPA. It provides Congress and the public with a clearer understanding of these financial activities, their justification, and their performance, thereby enhancing accountability.
This new subparagraph mandates that for each equity investment made, the relevant Committee member must transmit copies of all relevant documents and a certification that the investment advances the Act's objectives to specific Congressional committees within 10 days.
This introduces a direct and timely Congressional notification and justification requirement for individual equity investments, providing immediate oversight and ensuring that such investments are explicitly tied to national security interests. This enhances accountability and transparency for specific financial actions.
This new subsection clarifies that funds made available under Title II (Expansion of Productive Capacity and Supply) and section 318 shall remain available until expended.
This ensures that appropriations for DPA activities under Title II and section 318 do not lapse at the end of a fiscal year, providing greater flexibility and continuity for long-term projects aimed at expanding productive capacity and supply. This is crucial for sustained investment in national defense capabilities.
This entirely new section establishes a National Defense Executive Reserve, outlining its purpose to improve Federal Government preparedness for national defense emergencies by allowing private sector experts to volunteer for temporary Federal positions. It mandates the establishment of Reserve units in key agencies, provides for training, and requires the Office of Personnel Management to issue detailed rules for its operation, including employment protections.
This creates a new, formalized mechanism for leveraging private sector expertise during national emergencies, addressing potential workforce and skills gaps in critical areas. It enhances the government's ability to respond rapidly and effectively to crises by pre-identifying and training skilled personnel, thereby strengthening national defense capabilities.
This new subparagraph requires the Committee on Foreign Investment in the United States (CFIUS) to review 'reportable agricultural land transactions' involving foreign adversaries (China, North Korea, Russia, Iran) to determine if they are covered transactions and warrant further review. It also defines what constitutes a 'reportable agricultural land transaction' and includes a sunset provision for the adversary list.
This significantly expands CFIUS's oversight to explicitly include transactions involving agricultural land by foreign adversaries, addressing national security concerns related to food security and critical infrastructure. It provides a specific mechanism to scrutinize and potentially block such investments, protecting domestic agricultural resources.
This new paragraph adds the Secretary of Agriculture as a member of CFIUS for covered transactions involving agricultural land, agriculture biotechnology, or the agriculture industry (including transportation, storage, and processing).
This ensures that agricultural expertise is directly integrated into CFIUS reviews when transactions touch upon critical agricultural sectors. It provides a specialized perspective to assess the national security implications of foreign investments in agriculture, enhancing the committee's ability to protect vital resources.
These new paragraphs add specific content requirements to the DPA Committee's annual report: an evaluation of agency effectiveness in deploying DPA authorities, a summary of fraud reduction steps and a fraud risk assessment, and a summary of National Defense Executive Reserve activities with recommendations.
These additions significantly enhance the DPA Committee's annual reporting, providing Congress with more comprehensive insights into the operational effectiveness of DPA authorities, efforts to combat fraud, and the progress and challenges of the newly established Executive Reserve. This promotes greater accountability and informs future legislative and administrative actions.
This new subsection requires the Executive Director of the DPA Committee and, upon request, the head of any delegated Federal agency, to provide testimony to the House Financial Services Committee and Senate Banking, Housing, and Urban Affairs Committee within 90 days of submitting the annual report.
This establishes a direct and mandatory mechanism for Congressional oversight, ensuring that key DPA officials are accountable to legislative committees for the implementation and effectiveness of the Act. It provides a forum for in-depth discussion and scrutiny of the annual report's findings and recommendations.
This new subsection requires the Comptroller General of the United States to issue a report within two years on the quality of coordination and planning for the effective use of DPA Committee authorities, identifying areas for greater use or compliance, and recommending improvements.
This mandates an independent assessment of the DPA Committee's operational effectiveness, providing an external perspective on its coordination and planning. This report will be crucial for identifying systemic issues and guiding future reforms to optimize the Committee's function.
This new subsection requires the Subcommittee on Emerging Technology of the DPA Committee to submit an evaluation within 18 months on the potential benefits, drawbacks, and resources required for establishing a strategic reserve of critical biomanufacturing inputs essential to national defense.
This mandates a forward-looking assessment of a critical supply chain vulnerability in biomanufacturing, potentially leading to the establishment of a strategic reserve. It highlights the importance of emerging technologies for national defense and proactively addresses potential future shortages in vital biological inputs.
Deletions
v1 included a paragraph (2) under subsection (d) of Section 202 (Loans) that required notification to specific Congressional committees not later than 10 days after the President made a loan exceeding $50,000,000.
The deletion removes a specific Congressional notification requirement for large DPA loans. While other reporting mechanisms exist, this particular immediate notification for significant loans is no longer mandated, potentially reducing direct, timely oversight on individual large loan decisions.
v1 included a subsection (k) that authorized each agency represented on the Defense Production Act Committee to appoint subject matter experts directly to competitive service positions without regard to certain title 5 provisions, for the sole purpose of identifying, soliciting, evaluating, or approving financial assistance activities.
The deletion removes a specific, expedited hiring authority for subject matter experts within DPA-related agencies. This could impact the speed and flexibility with which agencies can bring in specialized talent to manage DPA financial assistance programs, potentially slowing down critical industrial base initiatives, though other general hiring authorities may still apply.
v1 included a subsection (e) in Section 310 (Employment of Personnel) that outlined penalties for the unauthorized disclosure of confidential information obtained under the Act.
The deletion removes the specific statutory penalties for unauthorized disclosure of confidential DPA-related information. While other general laws regarding classified or sensitive information may still apply, the explicit DPA-specific penalties are no longer present, potentially altering the legal framework for protecting such information.
v1 included a conforming amendment that explicitly repealed Section 1792 of the John S. McCain National Defense Authorization Act for Fiscal Year 2019.
The removal of this repeal means that Section 1792 of the John S. McCain National Defense Authorization Act for Fiscal Year 2019, which v1 intended to eliminate, will now remain in effect. This effectively preserves the provisions of that section, which v1 had sought to terminate, altering the broader legal landscape related to national defense authorizations.
v1 included a conforming amendment that struck subsection (e) and redesignated subsection (f) as subsection (e) of Section 226 of the National Defense Authorization Act for Fiscal Year 2018.
The removal of this amendment means that the original subsections (e) and (f) of Section 226 of the National Defense Authorization Act for Fiscal Year 2018, which v1 intended to modify, will now remain in their original form. This preserves the content and structure of those subsections, which v1 had sought to alter.
Modifications
This modification removes the explicit annual review and update requirement for DPA rules and regulations, replacing it with a more flexible 'whenever appropriate, revise' standard. This could reduce the frequency of mandatory reviews, potentially allowing regulations to remain unchanged for longer periods unless deemed necessary for revision.
Before
v1 stated that the President, in consultation with the Defense Production Act Committee, 'shall issue, and annually review and update whenever appropriate,' rules and regulations.
After
v2 states that the President, in consultation with the Defense Production Act Committee, 'shall issue and, whenever appropriate, revise' rules and regulations.
This modification clarifies that the findings for loans are specifically 'with respect to the national emergency' and decentralizes the authority for making these findings from the President to the lending agency in consultation with DPA Fund management and Committee members. This could streamline the decision-making process for loans during emergencies by involving more direct operational entities.
Before
v1 stated that 'except during a period of national emergency, no such loan may be made unless the President' makes certain findings.
After
v2 states that 'no such loan may be made with respect to the national emergency unless the lending agency, in consultation with the Fund manager of the Defense Production Act Fund and relevant members of the Defense Production Act Committee,' makes certain findings.
This modification adds a direct Congressional reporting requirement for the Fund manager's determination that an entity cannot secure private equity before a DPA equity investment is made. This increases Congressional oversight over the justification for government equity interventions, ensuring greater transparency and accountability in the use of DPA funds.
Before
v1 stated that a member of the DPA Committee may make an equity investment only after the Fund manager finds that the entity is unable to obtain additional equity investment from private sources on commercially reasonable terms.
After
v2 states that a member of the DPA Committee may make an equity investment only after the Fund manager 'reports to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives' that the entity is unable to obtain additional equity investment from private sources on commercially reasonable terms.
This is a technical correction reflecting the renumbering and restructuring of the DPA. It ensures that the deferral of budget authority for non-compliance with reporting requirements correctly references the current location of the DPA strategy report (Section 206(a)), without changing the operative effect of the deferral itself.
Before
v1 stated that the Executive Director of the DPA Committee shall defer budget authority for an agency that repeatedly fails to submit complete reports described under 'section 101(e) and 206(a)'.
After
v2 states that the Executive Director of the DPA Committee shall defer budget authority for an agency that repeatedly fails to submit complete reports described under 'section 206(a)'.
This modification strengthens the prohibition on covered entities receiving assistance by making it explicitly supersede any other potentially conflicting provisions in the DPA or other federal laws. This ensures that the eligibility limitation is a paramount restriction, preventing any loopholes or alternative interpretations that might allow covered entities to receive funds.
Before
v1 stated that 'A covered entity is not eligible for assistance authorized under this title.'
After
v2 states that 'Notwithstanding any other provision of this Act or any other Act, a covered entity is not eligible for assistance authorized under this title.'
This modification broadens the scope of activities that can be considered 'national defense' under the DPA, explicitly allowing the Act's authorities to be used for public health emergencies. This provides a clearer legal basis for DPA actions related to pandemics or other health crises, potentially enabling faster and more comprehensive responses to such events.
Before
v1 defined 'national defense' to include 'critical infrastructure protection and restoration'.
After
v2 defines 'national defense' to include 'critical infrastructure protection and restoration, and public health emergency preparedness and response activities'.
This modification provides a substantial increase in authorized funding for DPA activities for fiscal year 2026, reflecting a renewed commitment to strengthening the industrial base. The updated fiscal year ensures the authorization is current, enabling the DPA to address contemporary national defense requirements with greater financial resources.
Before
v1 authorized appropriations of '$133,000,000 for fiscal year 2015'.
After
v2 authorizes appropriations of '$250,000,000 for fiscal year 2026'.
This modification significantly alters the funding structure for DPA administration. While the annual amount is reduced, the reauthorization period is extended, and the funds are specifically directed to the DPA Committee's Executive Director and Fund manager for overall Act implementation. This centralizes administrative funding and extends its availability over a longer period, supporting the Committee's enhanced coordination role.
Before
v1 authorized appropriations of '$117,000,000 for each of fiscal years 2020 through 2024 to carry out title III'.
After
v2 authorizes appropriations of '$5,000,000 for each of fiscal years 2026 through 2031 to the Executive Director of the Defense Production Act Committee and the Fund manager of the Defense Production Act Fund to carry out this Act'.
This modification extends the operational life of key DPA authorities by an additional five years, from 2026 to 2031. This provides long-term stability and continuity for the government's ability to leverage the DPA for national defense and critical infrastructure needs, allowing for sustained planning and investment in the industrial base.
Before
v1 stated that certain DPA authorities would terminate on September 30, '2026'.
After
v2 states that certain DPA authorities will terminate on September 30, '2031'.
This modification clarifies the definition of 'urbanized area' for CFIUS purposes, allowing for flexibility in terminology used by the Bureau of the Census. This ensures that the scope of covered transactions related to urbanized areas remains consistent with evolving statistical definitions, without substantively changing the intent.
Before
v1 referred to properties 'in `urbanized areas`, as' defined by the Bureau of the Census.
After
v2 refers to properties 'in an `urbanized area`, or equivalent term, as' defined by the Bureau of the Census.
This modification imposes a stricter and more specific deadline for CFIUS to report to Congress after completing a review or investigation. This enhances Congressional oversight by ensuring more timely access to information regarding CFIUS's actions, allowing for more current scrutiny of foreign investment decisions.
Before
v1 stated that 'Upon completion of' a review or investigation, the Committee shall transmit certain information to Congress.
After
v2 states that 'Not later than the seventh day of the month following the month in which the Committee completed' a review or investigation, the Committee shall transmit certain information to Congress.
This modification increases the transparency of the CFIUS review process by requiring the inclusion of specific dates related to transaction acceptance and notification of review completion in reports to Congress. This provides greater clarity on the timeline and efficiency of CFIUS operations, benefiting both Congress and transaction parties.
Before
v1 required CFIUS reports to include certain details about transactions.
After
v2 adds a requirement to include 'the date on which the transaction was accepted by the Committee and the date on which transaction parties were notified of the completion by the Committee of the Committee's review of the transaction pursuant to subsection (b)(6)' to the CFIUS report.
This modification explicitly expands the scope of CFIUS's jurisdiction to include foreign investments in 'real estate in the United States'. This ensures that transactions involving critical land holdings, which may have national security implications, are subject to the same rigorous review as other asset acquisitions, protecting broader national interests.
Before
v1 referred to 'assets as a result' of a covered transaction.
After
v2 refers to 'assets or in real estate in the United States as a result' of a covered transaction.
This modification shifts the deadline for the CFIUS annual report by six months. This could provide CFIUS with more time to compile comprehensive data and analysis, potentially improving the quality of the report, but also delays Congressional access to the information.
Before
v1 required the CFIUS annual report to be submitted by 'March 31'.
After
v2 requires the CFIUS annual report to be submitted by 'September 30'.
This modification provides a clear, fixed sunset date for specific CFIUS provisions, removing ambiguity associated with a date tied to a prior Act's enactment. This offers certainty for stakeholders regarding the duration of these provisions, allowing for more predictable long-term planning.
Before
v1 stated that certain CFIUS provisions would terminate on 'the date that is 7 years after the date of the enactment of the Foreign Investment Risk Review Modernization Act of 2018'.
After
v2 states that certain CFIUS provisions will terminate on 'November 30, 2030'.
This modification provides a slight increase in authorized funding and a significant extension of the authorization period for CFIUS. This ensures sustained financial support for CFIUS operations over a longer term, enabling the committee to continue its vital national security reviews of foreign investments.
Before
v1 authorized appropriations for CFIUS of 'through 2023 $20,000,000'.
After
v2 authorizes appropriations for CFIUS of 'through 2030 $21,000,000'.
This modification simplifies the reporting requirements for the DPA Committee's annual report, consolidating references to other reports. This could reduce administrative burden by clarifying what needs to be included, while still ensuring that relevant information from agency-specific DPA strategies is incorporated.
Before
v1 required the DPA Committee's annual report to include 'the most recent reports submitted pursuant to section 206' and other specific items.
After
v2 streamlines the reporting requirements by replacing specific paragraph references with a single, broader requirement for 'the most recent reports submitted pursuant to section 206;'.
This modification fundamentally shifts the authority referenced in Title 10, Section 4891(b)(1), from the Secretary of Defense acting as a Presidential designee under the DPA to the Committee on Foreign Investment in the United States (CFIUS) making a determination under the DPA. This clarifies that CFIUS, as an interagency body, is the primary decision-maker in these contexts, rather than a single Secretary, aligning with the broader DPA modernization efforts.
Before
v1 amended Section 4891(a) of title 10, United States Code, by striking 'section 721(a)' and inserting 'section 316(a)'.
After
v2 amends Section 4891(b)(1) of title 10, United States Code, by striking 'If the Secretary of Defense is acting as a designee of the President under section 721(a) of the Defense Production Act of 1950 (50 U.S.C. 4565(a)) and if the Secretary determines' and inserting 'If the Committee on Foreign Investment in the United States determines, under section 316 of the Defense Production Act of 1950 (50 U.S.C. 4565),'.
Scope
Meaningful expansion or narrowing — Changes are scattered throughout the bill, affecting Title I (Priorities and Allocations), Title II (Expansion of Productive Capacity and Supply), Title III (General Provisions), and Title IV (CFIUS), as well as new sections on studies and conforming amendments. — v2 represents a meaningful expansion and clarification of policy direction. It extends the DPA's reauthorization, strengthens oversight mechanisms, broadens the scope of CFIUS, and introduces new preparedness initiatives like the National Defense Executive Reserve, while also refining administrative processes. — The changes interact significantly with existing DPA provisions by updating cross-references due to extensive renumbering of titles and sections. The new reporting requirements and oversight mechanisms directly modify the operational procedures of the DPA Committee and CFIUS, impacting how existing authorities are exercised and reported. The expansion of 'national defense' and CFIUS's scope will affect how other DPA provisions are applied.
Impact analysis
Federal agencies with delegated DPA authority
Procedural change, with increased accountability and potential administrative burden, and a slight narrowing of hiring flexibility.
Experience increased reporting requirements, including detailed annual reports on DPA strategy, fraud risk assessments, and evaluations of effectiveness. They also lose a specific expedited hiring authority for subject matter experts.
Defense Production Act Committee
Procedural change, with increased responsibilities, oversight, and direct accountability.
Has expanded membership (Fund manager, OMB Director), new annual report content requirements (fraud, Executive Reserve), and its Executive Director and Fund manager are now direct recipients of certain appropriations. The Executive Director and agency heads are also subject to new testimony requirements.
Entities seeking DPA equity investments
Procedural change, with increased transparency and oversight in the investment process.
The process for obtaining equity investments now includes a Congressional reporting requirement by the Fund manager if private financing is unavailable, and new Congressional notification for the investment itself.
Foreign persons (especially from China, North Korea, Russia, Iran) acquiring agricultural land or real estate in the U.S.
Loss of investment autonomy, with increased scrutiny and potential restrictions on certain types of acquisitions.
Their transactions involving agricultural land are now explicitly subject to CFIUS review, and CFIUS's jurisdiction is expanded to explicitly cover real estate acquisitions.
The Secretary of Agriculture
Procedural change, with increased influence and responsibility within CFIUS.
Becomes a member of CFIUS for transactions involving agricultural land, biotechnology, or the agriculture industry.
Private sector experts
Gain a new opportunity for public service and professional development.
Can now volunteer for and be trained in the newly established National Defense Executive Reserve, offering a formalized pathway to contribute expertise during national defense emergencies with employment protections.
The Defense Production Act of 1950
Extension of operational lifespan.
Its core authorities are reauthorized for an additional five years, from 2026 to 2031.
Individuals involved in public health emergency preparedness and response
Procedural change, with expanded applicability of DPA resources to their field.
Their activities are now explicitly included in the definition of 'national defense' under the DPA.