Lawmakers look to shield defense contractors from COVID-19 fallout

Lawmakers are becoming increasingly concerned about the novel coronavirus pandemic's effects on the defense industrial base.

Sen. Mark Warner (D-Va.) wants the Office of Management and Budget to direct government agencies to "consistently implement" contractor relief, including paid leave, in the multi-trillion-dollar Coronavirus Aid, Relief, and Economic Security Act passed in March.

"Without such overarching directive, I fear that agencies and their contracting officers will take disparate approaches, leading to uncertainty and instability in the contractor industrial base, if not a permanent loss of capability," Warner wrote in an April 2 letter to OMB.

"Agencies are already issuing memoranda on this topic that potentially diverge from one another," Warner noted

Warner also called for OMB to avoid "draconian cutbacks," including performance and cost extensions or contract adjustments, matching directives for unclassified and classified work, and fully endorses and supports telework for contractors.

The senator's letter comes as the Defense Department has released a steady stream of memos encouraging telework, allowing contractors to make the case for altered timelines or costs, and removing audit or reporting requirements to help defense companies get paid faster. However, DOD has also declared a large proportion of its workforce as essential. In a March 20 memo, Ellen Lord, DOD's head of acquisition, declared companies and their subcontractors that support the development, production, testing, fielding or sustainment of weapons and software systems as well as those who work in aerospace, as software engineers or IT support, among other national security areas, to be essential to national security.

The coronavirus crisis has spotlighted weak links in the global supply chain and infrastructure across sectors. But while the defense industry base is often regarded as resilient and prepared for worst-case scenarios, there's still worry that they too could be hobbled by COVID-19's spread.

Rep. Mac Thornberry (R-Texas), ranking member of the House Armed Services Committee, introduced legislation April 2 that would expand DOD's reform efforts for fiscal 2021, saying that such efforts were needed to keep national security intact during crises.

The bill, called the Expanding Acquisition Reform Act, adds reporting and briefing requirements for DOD, requiring the organization to regularly assess technological vulnerabilities and gaps in its supply chain, mitigation strategies, and timelines. There's also a provision that requires DOD to report whether they lack funds to address industry base vulnerabilities.

"One of the lessons we have already learned from the country's COVID-19 response is that we must pay closer attention to the vulnerabilities in the industrial base, especially the Defense Industrial Base," Thornberry said in a statement announcing the bill.

"This legislation increases oversight on that process, ensuring that DOD's mitigation efforts will stay on track."