Committee Chairs Launch Investigation Into DOD’s Inappropriate Use of CARES Act Funds
Washington, D.C. (October 2, 2020) — Today, Rep. James E. Clyburn, Chairman of the Select Subcommittee on the Coronavirus Crisis, Rep. Maxine Waters, Chairwoman of the Committee on Financial Services, Rep. Carolyn B. Maloney, Chairwoman of the Committee on Oversight and Reform, and Rep. Stephen F. Lynch, Chairman of the Subcommittee on National Security, sent a letter to Defense Secretary Mark Esper requesting documents on the potentially inappropriate use of hundreds of millions of dollars from the CARES Act.
The letter follows reporting that nearly $1 billion of Defense Production Act (DPA) funding, which Congress appropriated to DOD under the CARES Act to “prevent, prepare for, and respond to the coronavirus,” instead has been “funneled to defense contractors and used for making things such as jet engine parts, body armor, and dress uniforms.”
The Chairs wrote: “These funds were intended to prioritize the domestic production and distribution of urgently needed medical supplies and personal protective equipment (PPE)—many of which are still in short supply—but DOD has reportedly diverted a significant portion of these funds to provide lucrative contracts to defense contractors for non-medical projects. As Congress considers additional coronavirus relief legislation, Americans deserve to know that the Trump Administration is following the law and using relief funds for their intended purpose—to aid the nationwide pandemic response.
More than six months after the Administration declared the coronavirus pandemic a national emergency, medical supplies and PPE shortages persist. In August, the FDA published a list of devices in short supply, including “PPE, testing supplies and equipment, and ventilation-related products.” FEMA has confirmed that “the supply of N95 respirators for medical use is not expected to catch up to demand until January 2021.” Internal HHS documents reportedly show the federal government has fewer than 90 million of the 300 million N95 masks promised several months ago. Some nurses have had to re-wear N95 masks “more than the five times recommended by the CDC.” CDC Director Dr. Robert Redfield recently testified that the agency does not currently have the necessary resources to effectively distribute a coronavirus vaccine.
DOD reportedly diverted funds intended to address these shortages to instead award contracts for shipbuilding; satellites, drones, and space surveillance; aircraft parts; and Army uniform fabric.
DOD has argued that this spending supports the defense industrial base, but Congress appropriated the money specifically to expand domestic capacity for medical supplies and equipment. In a report accompanying the fiscal year 2021 defense appropriations bill, the House Committee on Appropriations made clear that using CARES Act funds to support the defense industrial base is “not the original intent of the funds.”
Today’s letter continued: “As communities across the United States continue to face critical PPE, medical supplies, and testing shortages due to President Trump’s failed response to the coronavirus pandemic, Congress and the American people deserve greater transparency from DOD about its use of supplemental relief funding and how those spending decisions are being made.”
The letter requested documents and information on DOD’s use of CARES Act funds by October 16, 2020.
Click here to read the Chairs’ letter to Defense Secretary Mark T. Esper.