Defense Production Act

The Defense Production Act is the primary source of presidential authorities to expedite and expand the supply of materials and services from the U.S. industrial base needed to promote the national defense.
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Titl III products Defense products Act Defense Titl III program authority
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Titl III products Defense products Act Defense Titl III program authority
Title III
 
of the
D f
P d
ti
A t
e ense ro uc on c
Matthew Seaford
 
(703) 415‐7107
DPA Background
• The Defense Production Act (DPA) is the President’s primary authority to 
ensure the timely availability of private sector resources for national defense.  
Title III of the DPA provides unique economic authorities to mitigate industrial
 
 
 
 
 
 
 
 
 
 
 
 
base shortfalls/risks and expand U.S. production capabilities to promote the 
“national defense”.
– DoD is the only Federal agency with an in‐place capability to execute Title III
 
 
 
 
 
 
 
 
 
 
 
 
 
 
authorities
– Other Government agencies partner with DoD to address their needs.
 Provide funding and technical support
Th d
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e  omest c  n ustr a   ase  s a cr t ca  e ement o  t e econom c an
 m tary 
power of the United States.
• “National defense” includes:
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– Programs  or m tary an
 energy pro uct on or construct on, stoc p ng, space, an
 
any directly related activity
– Critical infrastructure protection and restoration
– Military or critical infrastructure assistance to foreign nations 
– Homeland security
– Emergency preparedness
2
The Defense Production Act
(50 U.S.C. App. § 2061 et seq.)
• Enacted in 1950
― Provides broad authorities to the President to assure the ability of the domestic industrial base
―
to supply materials and services for the national defense.  DPA authorities delegated to Federal
― agencies via E.O. 12919
Title I – Priorities & Allocations
― Provides the authority to order priority performance (delivery) on defense contracts and allocate materials 
to meet national security requirements (DO/DX ratings)
 
 
 
 
 
 
• Title III – Expansion of Productive Capacity and Supply
― Authorizes appropriate incentives to create, expand or preserve domestic industrial manufacturing 
capabilities for industrial resources, technologies, and materials needed to meet national security 
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requ remen s nc u es ome an  secur y
• Title VII – General Provisions
― Exon-Florio (CFIUS)
― Voluntary Agreements – authorizes business competitors to form alliances for disaster planning and 
response and provides antitrust protection for actions pursuant to voluntary agreements
― National Defense Executive Reserve – provides for employment of private sector experts to support 
Federal Government preparedness planning and disaster response programs
• DPA not permanent law must be periodically reauthorized
 
 
 
 –
 
 
 
― Expires September 30, 2014
― Under jurisdiction of Banking Committees
3
Title III of the
Defense Production Act
• Government‐wide procurement authority.
– Provides financial incentives, including credit assistance, to finance the creation or 
expansion of domestic production capabilities and resources.
• Title III actions stimulate private investment in production resources by reducing the risks 
associated with the capitalization and investments required to establish the needed
 
 
 
 
 
 
 
 
 
 
 
production capacity.  Executes projects ranging from process improvement to production 
plant construction.
• Objectives include:
– Expanding/sustaining production capacity
– Ensuring U.S. Government access to technology/resources
– Ensuring long‐term commercial viability
 
 
 
• Title III is not a technology development or R&D program.
• Focus is on government‐wide/multi‐platform applications. 
4
Title III Authorities
Incentives to ensure viable productive capacities
• Purchases/Purchase Commitments (Sec. 303a)
— Purchases provide direct subsidy to company to assist in establishing production 
capacity
• Purchase and installation of production equipment
• Engineering support to improve quality and yield of production facility
• Sample quantities for process validation and customer qualification testing
• Costs to develop business and marketing plans
— Purchase Commitments
• Guaranteed market to incentivize companies to establish, expand or maintain production capability
• Company may use internal funding or obtain external funding i.e., loan
• Government is buyer of last resort.  Some or all of funds may not be expended
•
Installation of Production Equipment in Government or Privately Owned 
Facilities (Sec. 303e)
• Development of Substitutes (Sec. 303g)
• Loans/Loan Guarantees (Sec. 301; Sec. 302)
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Title III
Statutory Requirements
1. Obtain “Presidential Determination”
• Industrial resource or technology item 
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l d f
s essent a   or nat ona   e ense
• Industry cannot/will not provide 
needed capacity in a reasonable time 
without Title III assistance
2. Notify Congress in writing
3. Wait 30 days to allow for Congressional 
comment
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Title III Funds
• Title III appropriations are credited to Defense Production Act Fund
Special repository in Treasury to support Title III activities
–
 
 
 
 
 
 
 
 
– Usually made in DoD appropriations but can be included in other appropriations bills
– By law may only be used for Title III purposes
Title III appropriations are “no ear” proc rement f nds and are
•
 
 
 
 
‐y
 
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  u
 
 
 
valid until expended
• Revolving fund permits reuse of unexpended and recovered
 
 
 
 
 
 
 
 
moneys by Title III Program
• DPA contains its own authorization of appropriations
 
 
 
 
 
 
–
Funds appropriated for Title III are automatically authorized.  Title III initiatives are not normally 
included in authorization bills for this reason.
• Annual report to Congress required on transactions from the Fund
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Title III Organization
Under Secretary of Defense 
Acquisition, Technology and Logistics
Dr. Ashton B. Carter
OSD
Provides top‐level
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Assistant Secretary of Defense (Acquisition)
Mr. Shay Assad
Deputy Assistant Secretary of Defense
(Manufacturing & Industrial Base Policy)
Air Force
Manages technical 
po cy gu ance an
 
oversight of the 
Title III program
 
 
 
 
Mr. Brett Lambert
Director of Manufacturing
Mr. Neal Orringer
efforts, industrial base 
analysis, source selection 
and contracting activities, 
assisted by technical 
sponsors from the 
Defense Production Act Title III Program 
Program Director
Mr. Mark Buffler
Services and other 
Government agencies
Title III Program Executive Agent
SAF/AQRT
Air Force Research Laboratory 
Materials & Manufacturing Directorate
 
 
 
 
Title III Program Office
AFRL/RXM
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TITLE III BUSINESS PARTNERSHIP
Service‐Agency Partnerships
 Stakeholders provide 
technical insight in project 
planning and execution
 
 
 Facilitate insertion of 
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 n us ry par ner 
products into Service 
systems
Stakeholders Essential to 
Successful Technology
 
 
Transition & Capability
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Defense Production Act 
Title III Initiatives
ALON Transparent Armor
– Expanded production of ALON transparent armor
– ⅓ the thickness and ½ the weight of glass-based 
transparent armor.
– Improved ballistic protection, performance, and 
reliability for vehicles equipped with ALON.
Radiation Hardened Electronics Capital
– Stops .50 cal AP.
Advanced Explosives Detection
Technology
– Successfully scaled up production of the 
Fido IED Detection device
– Provides compact, superior detection 
Expansion Project
– Modernized two obsolete semiconductor 
foundries to maintain a critical technology for 
defense space & missile systems
– 0.15-micron rad hard electronics enable 
advanced processing & performance 
biliti
Silicon Carbide Substrates
– Established viable production base for SiC MMIC 
devices & accelerating insertion of SiC based 
technology into DoD systems
capabilities against explosives & IED 
threats
– Facilitates new non-military markets –
e.g., first responder, customs, homeland 
security
capa
es
– Preserves a critical domestic industrial 
resource needed for national security
Thermal Battery Project
– Establishing domestic 
manufacturing capacity for 
advanced thermal batteries for
 
 
 
– Enabler for next-generation radar systems, 
electronic warfare systems & advanced 
communications systems
– Enabled installation of LED lighting in Pentagon 
& other Federal buildings
– Enabled GaN-on-SiC MMICs for next generation 
CREW C
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tactical and strategic defense 
systems
– Partnering with domestic providers 
to expand production capacities
– Significant performance advantages 
over current battery technology 
 oun er mprov se  xp os ve ev ce 
system
w/lower maintenance costs
Light-Weight Polymer Ammunition
– Developing a production capability for light-
weight polymer-based ammunition.
– ~30% lighter than conventional ammunition.
– Drop-in replacement for existing systems – no 
LED Light
Re-establishing Domestic 
Beryllium Production Capability 
– Re-establishing domestic 
manufacturing capability for high-
purity Beryllium
redesign required.
– Reduces soldier burden
– Improves battlefield mobility and survivability
– Reduces fuel consumption, improves 
battlefield logistics.
– Supports Lighten-the-Load Initiative
– Critical enabling material for 
defense applications including: 
electro-optic systems; missile 
guidance systems, satellites, 
missile defense systems, nuclear 
weapons, nuclear power plants
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Summary
Title III provides powerful authorities that enable the 
Government to rectify industrial base shortfalls
Synergy of technical and business objectives focused 
on long‐term economic viability and technology 
i
i
nsert on
Broad participation enhances leverage
Title III Program has proven performance and 
innovative execution
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Defense Production Act 
i l
C
T t e III  ontacts
web site: 
http://www.acq.osd.mil/ott/dpatitle3/
OSD Program Director
Mr. Mark Buffler
DASD(MIBP)
(703) 415‐7106
mark.buffler@osd.mil
Air Force Executive Agent
Mr. Jeff Smith
AFRL/RXM
(937) 904‐4591
 
Jeffrey.smith@wpafb.af.mil
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