Lawmakers, contractors look to extend COVID aid to industry

Lawmakers and defense industry groups are pushing to extend pandemic relief authorities that reimburse government contractors for paid leave if they are unable to work through the end of the fiscal year.

Sens. Marco Rubio (R-Fla.) and Mark Warner (D-Va.) are asking Senate leaders for legislation to extend reimbursement authorities of Section 3610 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, allowing federal contractors to pay employees who couldn't work due to the pandemic to Sept. 30.

The current provision is set to expire on March 31.

"We believe extending this authority given the prolongation of the global pandemic is critically important to the resilience of our national security industrial base," the senators wrote in a letter dated Feb. 25 to Senate Majority Leader Charles Schumer and Minority Leader Mitch McConnell. "Section 3610 has proven to be an important means of providing necessary relief during the pandemic to critical Intelligence Community industry partners -- and particularly to small businesses that provide highly specialized capabilities -- to retain key national security capabilities."

Advocacy groups for government and defense contractors bolstered the senators' call with a separate letter to House and Senate leaders, saying that Section 3610 is still used to keep national security programs running and that COVID-19 is still a national emergency despite increased vaccination rates.

"Until agencies allow all contractors back to their worksites and we are past the need for quarantines shutting down workspaces, Section 3610 continues to be a critical tool for retaining highly skilled workers supporting operations across the government," the National Defense Industry Association, Professional Services Council, and nine other industry groups wrote in a Feb. 25 letter to congressional leaders.

"Agencies are not mandated to utilize Section 3610, and the authority's extension does not require additional appropriations," the letter states.

Stacy Cummings, the Defense Department's acting acquisition chief, told the Senate Armed Services Committee on Feb. 25 that DOD would need additional resources to adequately utilize Section 3610 and cover contractors' added costs.

So far DOD has only reimbursed about $50 million to 84 companies under Section 3610, Cummings stated in her prepared testimony.

"While the Department may be able to use other appropriated funds to reimburse contractors, the cost for 3610 is beyond the Department's resourced ability to do so without jeopardizing modernization or readiness," Cummings wrote.

DOD pegs those costs at $10.8 billion as of Dec. 1, 2020. That includes $4.25 billion in paid leave costs and $6.5 billion for other COVID-19 related costs, including personal protective equipment, sanitation and reconfiguring facilities to allow for social distancing.

Former acquisition chief, Ellen Lord, repeatedly highlighted this funding gap during testimonies last year, as defense companies urged DOD and Congress to greenlight more funding to offset costs accrued in response to the pandemic.

Cummings suggested during her testimony that greater funding flexibilities -- along with appropriations -- could help support buying emergency products and services during a national crisis like the ongoing coronavirus pandemic.