DOD, DFC Sign Memorandum of Agreement on Defense Production Act
(Source: US Department of Defense; issued June 22, 2020)
ARLINGTON, Virginia --- Today, U.S. Department of Defense Under Secretary for Acquisition and Sustainment Ellen M. Lord and U.S. International Development Finance Corporation (DFC) Chief Executive Officer Adam Boehler signed a memorandum of agreement.

The MOA formalizes the relationship between the two organizations as outlined in Executive Order 13922, which delegated authority to DFC to execute loans using Defense Production Act (DPA) Title III in support of COVID-19 response.

The program will utilize $100 million of DOD’s CARES Act spend plan to support DFC financing to projects that create, expand, or restore domestic industrial base capabilities in response to COVID-19.

“Today marks an important milestone in DFC’s collaboration with DOD under the Defense Production Act,” said Boehler. “We look forward to working together with DOD and the private sector to protect the health and safety of Americans by strengthening critical supply chains at home. Increased U.S. production of strategic resources will also allow the United States to assist allies around the world.”

“The COVID-19 pandemic response has highlighted what DOD has always known, a strong domestic supply chain is critical for economic and national security. DOD is committed, in partnership with other federal agencies, to bring all tools available to support the response to COVID-19,” said Under Secretary Lord. “I look forward to this partnership between DOD and DFC. We both wholeheartedly believe it will provide new avenues to expand and support our domestic industrial base for medical resources in support of the nation’s COVID-19 response.”

Under the MOA, DFC will originate, screen, and conduct due diligence on projects seeking financing under the DPA. The agency will also underwrite and finance projects that clear DFC’s comprehensive review process. These responsibilities will be carried out in close consultation with DOD, which will bear all direct and indirect costs of DFC’s DPA programs. Further, the agencies will establish a working group to ensure close coordination and implementation of the MOA.

The signing of the MOA was followed by the launch of a request for proposals from private sector entities seeking DFC financing under the DPA. Eligible projects should help re-shore production—or strengthen related domestic supply chains—of personal protective equipment, medical testing supplies, vaccines, pharmaceuticals, ventilation equipment, or relevant ancillary materials and technologies. Interested parties can review the full eligibility criteria and learn how to submit a proposal on the DFC website. Submissions will be reviewed on a rolling basis and selected through a competitive process subject to a thorough due diligence and approval process. Visit www.dfc.gov/dpa to learn more.

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DOD Partners with DFC to Protect Industrial Base from Economic Effect of Pandemic
(Source: US Department of Defense; issued June 22, 2020)
The Defense Department and the U.S. International Development Finance Corporation today signed a joint memorandum of agreement to spend $100 million of the department's Coronavirus Aid, Relief and Economic Security Act money to subsidize federal loans to create, maintain, protect, expand and restore domestic industrial-based capabilities to support the national COVID-19 response.

Ellen M. Lord, undersecretary of defense for acquisition and sustainment, and Adam S. Boehler, the DFC's CEO, signed the agreement at a Pentagon news conference today.

On May 14, President Donald J. Trump signed an executive order authorizing the corporation to execute loans using the Defense Production Act Title III authorities in support of the COVID-19 response, Lord said. This two-year authorization is in conjunction with Defense Production Act — loan-related waivers from Congress in the CARES Act.

DFC, formerly known as the Overseas Private Investment Corporation, brings decades of federal credit experience to advance national objectives and address domestic challenges, such as in response to the current outbreak, Lord said. It also has the unique ability to address this crisis with a global perspective, coordinating their international efforts with the domestic effort, she added.

Boehler said DFC looks forward to partnering with DOD. "After fighting two world wars that required unprecedented economic mobilization, the country recognized that America's strength against any enemy is derived from our people, a workforce that built the greatest economy in the world. They understand that our country's freedom cannot be separated from the strength of our economy," he said.

Congress passed the Defense Production Act in 1950 to provide the tools necessary to harness the power of the economy in times of national crisis, he said.

DFC, created in December, modernizes and reforms the government's development finance capabilities; primarily the Overseas Private Investment Corporation and the Development Credit Authority of the U.S. Agency for International Development.


Click here for the memo (11 PDF pages), on the Pentagon website.


Click here for the transcript of the June 22 press conference, on the Pentagon website.

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