The Berry Amendment: Requiring Defense Procurement to Come from Domestic Sources

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This collection includes CRS reports from the mid's through the present--covering a variety of topics from agriculture to foreign policy to welfare. What responsibilities do I have when using this report? Dates and time periods associated with this report. Description The Berry Amendment requires the Department of Defense DOD to give preference in procurement to domestically produced, manufactured, or home grown products, notably food, clothing, fabrics, and specialty metals. Physical Description 22 pages. B The extent to which fire-resistant rayon fiber has unique properties that provide advantages for the production of military uniforms;.

C The extent to which the efficient procurement of fire-resistant rayon fiber for the production of military uniforms is impeded by existing statutory or regulatory requirements;. D The actions the Department of Defense has taken to identify alternatives to fire-resistant rayon fiber for the production of military uniforms;. E The extent to which such alternatives provide an adequate substitute for fire-resistant rayon fiber for the production of military uniforms;.

F The impediments to the use of such alternatives, and the actions the Department has taken to overcome such impediments;. G The extent to which uncertainty regarding the future availability of fire-resistant rayon fiber results in instability or inefficiency for elements of the United States textile industry that use fire-resistant rayon fiber, and the extent to which that instability or inefficiency results in less efficient business practices, impedes investment and innovation, and thereby results or may result in higher costs, delayed delivery, or a lower quality of product delivered to the Government; and.

H The extent to which any modifications to existing law or regulation may be necessary to ensure the efficient acquisition of fire-resistant fiber or alternative fire-resistant products for the production of military uniforms. GAO found that an Austrian company was the sole source for fire-resistant rayon fiber for the manufacture of fire-resistant uniforms for military personnel, that DOD had taken steps to identify and test alternative fire-resistant, fabric blends to meet current demands, and that there was debate over whether fire-resistant rayon's flame resistant characteristics posed a superior advantage over other alternatives.

GAO did not provide a recommendation. GAO was also congressionally directed to assess whether the Berry Amendment was sufficient protection for the defense industrial base and whether alternatives and solutions existed to keep critical industries healthy and viable, in times of both war and peace. This report required GAO to determine whether the Defense Logistics Agency DLA was properly implementing applicable statutory and regulatory guidance for "best value" purchases and to solicit DLA views on the domestic clothing and textile supplier base. GAO officials acknowledged that the Berry Amendment was a positive factor in helping DOD to maintain a domestic supplier for some of DOD's unique military needs; however, officials pointed out that the overall domestic clothing and textile industry was in decline due to declining employment and production levels, as well as the implementation of various free trade agreements that may affect different levels of the domestic supply chain.

One legislative provision was enacted and three other provisions were proposed that would impact the application of the Berry Amendment to DHS. In there were first media reports that the Under Secretary of Defense for Acquisition, Technology, and Logistics had considered several legislative proposals to broaden the exceptions provided under the Berry Amendment. One such proposal would have granted DOD authority to waive the requirements of the Berry Amendment during so-called emergency operations.

Such emergency operations might include military action taken against U.

Another proposal would have authorized military procurement officials to give contracting preference to indigenous groups for the purpose of expanding economic development in a contingency operation. Two public resources provide answers to many of the most often-asked questions on the Berry Amendment.

The questions and answers ranged from origin and history, authority, policy, and exceptions; comparisons with other domestic source restrictions like the Buy American Act; the policy governing determinations of non-availability DNAD ; and many questions often raised by suppliers and other industry personnel. Department of Commerce has launched a website to provide textile and other manufacturers a resource for the latest information on the Berry Amendment.

The Berry Amendment contains a number of domestic source restrictions that prohibit DOD from acquiring food, clothing, fabrics including ballistic fibers , specialty metals, stainless steel, and hand or measuring tools that are not grown or produced in the United States. Congress and DOD have long debated the need to protect the U. During the second session of the 82 nd Congress, Elias Y. Berry, Representative from South Dakota, introduced two bills to amend the Buy America Act to include wool as a product or material, produced or manufactured in the United States.

Under the Berry Amendment, the Secretary of Defense has the authority to waive the requirement to buy domestically, under certain conditions. The controversy over the procurement of black berets and the waiver authority of the Secretary of Defense, as well as the presence of other domestic source provisions, have created considerable interest in the Berry Amendment. Some policy makers believe that the Berry Amendment's restrictions like the specialty metal clause contradict free trade policies, and that the presence and degree of such competition is the most effective tool for promoting efficiencies and improving quality.

Others believe that U. These two views have been the subject of ongoing debate in Congress. The Army planned to issue a one-piece beret to each of the 1. Other contracts were awarded to several foreign manufacturing firms; five of the foreign firms had production facilities in the People's Republic of China, Romania, Sri Lanka, and other low-wage countries. The first waiver was granted to DOD so that the department could purchase military uniforms from foreign sources. DLA granted this waiver when it determined that no U. As a result, there were protests from some segments of domestic manufacturing, military and veterans groups, Members of Congress, and the public.

The House Small Business Committee held a hearing on May 2, , to discuss the statutory authority to waive Berry Amendment restrictions, as well as the concerns of the small business community regarding the contract award process.

The Berry Amendment: Requiring Defense Procurement to Come from Domestic Sources

DLA granted the second waiver to allow Bancroft to retain its contract and continue to produce the black berets for the Army, even though Bancroft used materials from foreign sources. Bancroft, the sole U.

Bancroft's president reported that, as early as , DOD had been notified that some beret materials were procured from foreign sources. The contract was a two-year contract with three one-year options. There were proposals solicited, and 13 vendors responded. By some, where DOD purchases its berets is viewed as a relatively minor matter, when compared to where it purchases its electronics; specialty metals; and other hardware used for logistics support, communications, and weapons modernization. However, to others small businesses' loss of such a contract to foreign sources can be seen as unacceptable.

In , House and Senate Members held spirited discussions 41 over the passage of what has come to be known as the Berry Amendment, although the precise identity of the author of the amendment remains unknown. Even though the United States was not at war, Congress was concerned that the nation be prepared for adversity and thus provided the impetus for such legislation. Some policy makers were also concerned that despite the enactment of the Buy American Act in , one department of the federal government had reportedly purchased meat from Argentina.

Questions were raised over the disposal of some million bushels of surplus wheat, with one policy maker noting that "wheat products and wheat should be purchased from the production here in the United States when we have such a surplus on hand and that our own farmers should be given preference. The Senate version initially deleted the provision, but later reinstated it, broadening the bill to include all agriculture.

The bill was enacted into law on April 5, Largely as a result of the controversy surrounding the procurement of the black berets, Representative Walter B. Jones introduced a bill to amend Title 10 of the United States Code, thus making the Berry Amendment a permanent provision of law. On April 3, , Representative Jones introduced H. At the introduction of the bill, Representative Jones stated that the black beret controversy and the decision of the Defense Logistics Agency to waive the Berry Amendment provisions and allow the procurement of berets from foreign sources highlighted the need to review the current law and look for ways to improve the effectiveness of the law.

The provisions of H. The Berry Amendment overrides many of these exceptions, primarily for food, clothing, and specialty metals. It should be noted that there are a number of other domestic source provisions which generally govern specific types of procurement; these provisions are not covered by the BAA or the Berry Amendment.

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These provisions will not be covered in this report but must be considered when determining whether or not a specific domestic source provision affects a particular type of procurement. Some observers argue that the Berry Amendment restrictions may not always represent the best value to DOD or the federal government, nor is there always a justifiable national security interest to preserve certain items currently under the Berry Amendment.

Nevertheless, others have asserted that U. A number of Berry Amendment-restricted items may be in line with the original purpose and intent, based on the end use products that are produced. For example, certain items like chemical warfare protective clothing composed of ballistic fibers, made from textiles may warrant further study. Specialty metals may be critical and vital to the war-fighting effort if they are used for "high-tech" electronics and communications. Food restrictions, on the other hand, are not critical and may make it more difficult for DOD to take advantage of commercial business practices.

In an increasingly globalized economy, many food suppliers find it difficult to adhere to this restriction as it deviates from standard commercial business practices, so some may decline to sell to DOD.

Many food suppliers who sell to DOD claim they are often forced to adopt unique, costly, and inefficient business practices to do business with the defense sector. Economic, social, and political factors come into play when examining the purpose and intent of the Berry Amendment. If the United States becomes dependent on purchasing equipment and supplies from foreign sources, what prevents an adversary from cutting off U.

Another argument for maintaining the Berry Amendment restrictions is that they often benefit small, minority-owned, and disadvantaged businesses, which may depend on DOD for their viability. According to congressional testimony, U. Some would argue that the Berry Amendment is still relevant today because of the tragic events of September 11, There are also concerns over the possibility of future acts of terrorism and the safety and security of the nation's food supply.

Some specialty metals and steel products, items covered under the Berry Amendment, are produced by distressed U. One such company, Bethlehem Steel, one of the largest U. Generally, proponents of the Berry Amendment have argued that these types of restrictions are necessary to maintain a viable industrial base, and that the Berry Amendment serves as some protection for critical industries by keeping them healthy and viable in times of peace and war.

For these reasons, some believe that this is not the time to change the provisions of the Berry Amendment, arguing that the United States should maintain its current capacity, at a minimum, to feed and clothe its military forces. However, critics argue that the Berry Amendment can undercut free market competition and may produce other negative effects, such as reducing business incentives to modernize, causing inefficiency in some industries due to a lack of competition, and causing higher costs to DOD because the military services may pay more for "protected" products than the market requires.

Critics also contend that the Berry Amendment promotes U. For example, the delays associated with the procurement of body armor for U. DOD officials have expressed contrasting views about the necessity for the Berry Amendment. The report suggested that an alternative to the Berry Amendment would be a specifically targeted approach to provide DOD with the ability to establish assured sources of supply for mobilization purposes through existing mobilization base planning under the Defense Production Act.

The Berry Amendment: Requiring Defense Procurement to Come from Domestic Sources

In , the DOD Acquisition Reform Executive Focus Group's final report called for the elimination of some Berry Amendment restrictions on food, clothing, and textiles, while retaining restrictions on specialty metals and measuring tools. Henry, testified that the Berry Amendment was critical to the maintenance of a "warm" U.

He summed up his opinion, as follows:. The point here is that, through the Berry Amendment, our defense procurement establishment is able to maintain a stable of independent, competing producers who understand the mil-specs of different items and who have the commitment to service the U. They are there for our military when there is a surge in requirements—as there was with Desert Storm—and they must be there during peacetime. Some proponents of the Berry Amendment believe that the U. Furthermore, some believe that the Berry Amendment should be expanded to include other important industries and those new federal agencies like the Department of Homeland Security should be covered by the provisions of the Berry Amendment.

Some critics of the Berry Amendment also argue that the United States will lose its technological edge in the absence of competition and alienate foreign trading partners, thereby provoking retaliations and loss of foreign sales. They assert that the Berry Amendment will ultimately reduce the ability of the United States to negotiate and persuade its allies to sell or not sell to developing countries. They contend that the Berry Amendment promotes U. Furthermore, restrictions on food mean that in most cases it is illegal for DOD to purchase an item or food if it is a foreign item or if it has any foreign ingredient or processing.

On the other hand, critics have also expressed concern over the increased levels of imported, ready to wear goods, and the prevalent "sweat shop conditions" of foreign markets.

In , the Berry Amendment Reform Coalition a group of associations and member companies that support legislative reforms to the Berry Amendment proposed legislative reforms that advocated for exceptions to the Berry Amendment for domestic specialty metals. The specialty metals clause provides protection for strategic materials critical to national security. Congress may choose to examine the domestic source restrictions under the Berry Amendment and other procurement provisions and to determine whether they help or hurt the defense industrial base, including relationships with foreign trading partners.

Congress may choose to take no action, to retain the current provisions of the Berry Amendment as enacted in law. Congress might eliminate some selected restrictions, such as the restrictions on food. This move would arguably promote more competition and interest in selling food to DOD. For example, some in DOD believe that elimination of the food restriction would allow food suppliers greater and more practical latitude to use foreign ingredients and processing, in line with current commercial practice.

Many food suppliers find this restriction to be the least practical and even trade associations of food suppliers have stated that this restriction makes it more difficult to do business with DOD. From Wikipedia, the free encyclopedia. Retrieved — via Federation of American Scientists. Requirement to buy strategic materials critical to national security from American sources; exceptions".

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