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1 1 (January 29, 2020)

handle is hein.crs/govbdzw0001 and id is 1 raw text is: '. ~**\**\ &~ ~ riE SE .$rCh &~ ~ ~ Updated January 29, 2020 Defense Primer: The Berry and Kissell Amendments Two U.S. laws require the Department of Defense (DOD) and some agencies of the Department of Homeland Security (DHS) to purchase only domestic products for certain military and nonmilitary purposes. These laws are known as the Berry Amendment and the Kissell Amendment. Congress typically debates the Berry Amendment in the context of the annual National Defense Authorization Act. The laws are controversial. Supporters argue they help preserve the U.S. industrial base and create domestic manufacturing jobs. Some lawmakers also assert that production of government uniforms outside the United States raises national security concerns. Opponents believe the laws give monopolies to certain companies and raise the government's procurement costs. They also claim these laws are inconsistent with modern supply chains that source components and raw materials from multiple countries. Tine Bek3r> Anne(dmen*P The Berry Amendment (10 U.S.C. §2533a) is the popular name of a 1941 law enacted as part of the Fifth Supplemental National Defense Appropriations Act (P.L. 77-29). It became a permanent part of the U.S. Code when it was codified by the FY2002 National Defense Authorization Act (NDAA; P.L. 107-107). The Berry Amendment requires certain items purchased by DOD to be 100% domestic in origin. The requirement generally extends to inputs into the purchased items. The items covered by the law have varied over the years. The law affects DOD purchases of textiles, clothing, footwear, food, and hand or measuring tools. Recently, Congress reinstated stainless-steel flatware and dinnerware as additional covered items. DOD purchases of these items must be entirely grown, reprocessed, reused, or produced in the United States. Unless exemptions in the law apply, the entire production process of affected products, from the production of raw materials to the manufacture of all components to final assembly, must be performed in the United States. The Berry Amendment mandates a much higher level of domestic content than the Buy American Act of 1933, which generally governs the procurements of other federal agencies. Under the Buy American Act, the final product must be mined, produced, or manufactured in the United States, and if manufactured, either at least 50% of the costs of its components must be manufactured in the United States, or the end product must be a commercially available off-the-shelf item. Sales to DOD in the five Berry-applicable product categories totaled about $3.3 billion in FY2019. DOD expenditures on Berry Amendment products accounted for roughly 1% of the department's spending on products and services in FY2019, according to figures from the Federal Procurement Data System-Next Generation (FPDS-NG), the primary source for federal procurement data. The Kissell Amendment (6 U.S.C. §453b) was enacted as Section 604 of the American Recovery and Reinvestment Act of 2009 (P.L. 111-5) and, through the Homeland Security Acquisition Regulation, made permanent on March 5, 2013. Kissell requirements are modeled on the Berry Amendment. Since August 2009, the Kissell Amendment has required DHS when using appropriated funds directly related to national security interests, to buy textiles, clothing, and footwear, from domestic sources. Excluded are food and hand or measuring tools. Although the Kissell Amendment as enacted applies to all agencies of DHS, in practice its restrictions apply only to the Transportation Security Administration. This is because, prior to the Kissell Amendment's passage, the United States had entered into commitments under the World Trade Organization Agreement on Government Procurement, and under various free-trade agreements, to open U.S. government procurement to imported goods. The Kissell Amendment applies only where it does not contravene those commitments. Procurement by other DHS agencies, including the Secret Service, Immigration and Customs Enforcement, and Customs and Border Protection, is subject to the less- stringent Buy American Act. For these DHS agencies, the Buy American Act is also waived pursuant to the Trade Agreements Act (P.L. 96-39). Thus, they can purchase textiles and apparel products from more than 100 countries if certain conditions are met. Between October 2014 and June 2017, more than half of DHS's uniform items came from foreign sources, according to a 2017 report by the Government Accountability Office. Kismrry Endpo The Berry Amendment includes various exceptions. For example, DOD can buy from non-U.S. sources when * products are unavailable from American manufacturers at satisfactory quality and sufficient quantity at U.S. market prices; * items are used in support of combat operations or contingency operations; * products are intended for resale at retail stores such as military commissaries or post exchanges; and * purchases are part of a contract whose value is at or below the Simplified Acquisition Threshold, generally $250,000, in which case the item can be sourced overseas. (The FY2018 NDAA (P.L. 115-91) raised the threshold from $150,000, which allows foreign suppliers to bid on more DOD procurement contracts.) The Kissell Amendment has some similar exceptions, but one notable difference. Manufacturers in Mexico, Canada, and Chile can be treated as American sources under Kissell requirements because of existing trade agreements. 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