Securing Americas Rare Earths Supply Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 3567 To modify the requirements relating to the acquisition and disposal of certain rare earth materials, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JUNE 27, 2019 Ms. HOULAHAN (for herself and Mr. COOK) introduced the following bill; which was referred to the Committee on Armed Services A BILL To modify the requirements relating to the acquisition and disposal of certain rare earth materials, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Securing Americas 4 Rare Earths Supply Act of 2019’’. 5 SEC. 2. ACQUISITION AND DISPOSAL OF CERTAIN RARE 6 EARTH MATERIALS. 7 (a) GUIDANCE ON STREAMLINED ACQUISITION OF 8 RARE EARTH MATERIALS.— 9 VerDate Sep 11 2014 05:04 Jul 09, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3567.IH H3567 kjohnson on DSK79L0C42 with BILLS 2 •HR 3567 IH (1) IN GENERAL.—Not later than 180 days 1 after the date of the enactment of this Act, the 2 Under Secretary of Defense for Acquisition and 3 Sustainment, in consultation with the Under Sec- 4 retary of Defense (Comptroller), the Vice Chairman 5 of the Joint Chiefs of Staff, and the appropriate 6 Under Secretary of State designated by the Sec- 7 retary of State shall establish guidance to— 8 (A) enable the acquisition of items con- 9 taining rare earth materials; and 10 (B) establish a secure supply chain for 11 rare earth materials from sources within the 12 United States and covered foreign sources. 13 (2) CONTENTS.—The guidance required by 14 paragraph (1) shall encourage the use of rare earth 15 materials mined, refined, processed, melted, or sin- 16 tered in the United States and include— 17 (A) a determination of when best value 18 contracting methods should be used to ensure 19 the viability of a rare earth material supplier; 20 (B) a guide to the applicability of relevant 21 statutes, including sections 2533b and 2533c of 22 title 10, United States Code, and other statu- 23 tory or regulatory restrictions to defense con- 24 tracts and subcontracts; 25 VerDate Sep 11 2014 05:04 Jul 09, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3567.IH H3567 kjohnson on DSK79L0C42 with BILLS 3 •HR 3567 IH (C) information on current sources within 1 the United States and covered foreign sources 2 of rare earth materials along with commonly 3 used commercial documentation and review 4 processes; 5 (D) directives on budgeting and expending 6 funds for the qualification and certification of 7 suppliers of rare earth materials within the 8 United States to meet national security needs; 9 and 10 (E) any exceptions to the Joint Capabili- 11 ties Integration and Development System Man- 12 ual and Department of Defense Directive 13 5000.01. 14 (3) REPORT.—Not later than 180 days after 15 the date of the enactment of this Act, the Under 16 Secretary of Defense for Acquisition and Sustain- 17 ment, in consultation with the appropriate Under 18 Secretary of State designated by the Secretary of 19 State, shall submit to the congressional defense com- 20 mittees, the Committee on Foreign Affairs of the 21 House of Representatives, and the Committee on 22 Foreign Relations of the Senate a report on— 23 (A) the guidance required by paragraph 24 (1); and 25 VerDate Sep 11 2014 05:04 Jul 09, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3567.IH H3567 kjohnson on DSK79L0C42 with BILLS 4 •HR 3567 IH (B) the efforts of the Secretary of Defense 1 to create and maintain secure supply chain for 2 rare earth materials from sources within the 3 United States and covered foreign sources. 4 (4) DEFINITIONS.—In this subsection: 5 (A) COVERED FOREIGN SOURCE.—The 6 term ‘‘covered foreign source’’ means a source 7 located in a foreign country that is not an ad- 8 versary of the United States, as determined by 9 the Secretary of Defense. 10 (B) RARE EARTH MATERIAL.—The term 11 ‘‘rare earth material’’ means a concentrate, 12 oxide, carbonate, fluoride, metal, alloy, magnet, 13 or finished product whose chemical, magnetic, 14 or nuclear properties are largely defined by the 15 presence of— 16 (i) yttrium; 17 (ii) scandium; or 18 (iii) any lanthanide series element. 19 (b) AUTHORITY TO DISPOSE OF AND ACQUIRE MA- 20 TERIALS FOR THE NATIONAL DEFENSE STOCKPILE.— 21 (1) DISPOSAL AUTHORITY.—Pursuant to sec- 22 tion 5(b) of the Strategic and Critical Materials 23 Stock Piling Act (50 U.S.C. 98d(b)), the National 24 Defense Stockpile Manager shall dispose of 25 VerDate Sep 11 2014 05:04 Jul 09, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3567.IH H3567 kjohnson on DSK79L0C42 with BILLS 5 •HR 3567 IH 3,000,000 pounds of tungsten ores and concentrates 1 contained in the National Defense Stockpile (in ad- 2 dition to any amount previously authorized for dis- 3 posal). 4 (2) ACQUISITION AUTHORITY.— 5 (A) AUTHORITY.—Using funds available in 6 the National Defense Stockpile Transaction 7 Fund, the National Defense Stockpile Manager 8 may acquire the following materials determined 9 to be strategic and critical materials required to 10 meet the defense, industrial, and essential civil- 11 ian needs of the United States: 12 (i) Aerospace-grade rayon. 13 (ii) Electrolytic manganese metal. 14 (iii) Pitch-based carbon fiber. 15 (iv) Rare earth cerium compounds. 16 (v) Rare earth lanthanum compounds. 17 (B) AMOUNT OF AUTHORITY.—The Na- 18 tional Defense Stockpile Manager may use up 19 to $37,420,000 in the National Defense Stock- 20 pile Transaction Fund for acquisition of the 21 materials specified in subsection (b). 22 (C) FISCAL YEAR LIMITATION.—The au- 23 thority under subsection (b) is available for pur- 24 VerDate Sep 11 2014 05:04 Jul 09, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3567.IH H3567 kjohnson on DSK79L0C42 with BILLS 6 •HR 3567 IH chases during fiscal year 2020 through fiscal 1 year 2024. 2 (c) NATIONAL DEFENSE STOCKPILE SALES.— 3 (1) SENSE OF CONGRESS.—It is the sense of 4 Congress that tantalum should be designated as a 5 strategic and critical material under the Strategic 6 and Critical Materials Stock Piling Act (50 U.S.C. 7 98 et seq.) required to meet the defense, industrial, 8 and essential civilian needs of the United States. 9 (2) NATIONAL DEFENSE STOCKPILE SALES OF 10 TANTALUM.—Section 2533c(d)(1) of title 10, United 11 States code, is amended— 12 (A) in subparagraph (C), by striking 13 ‘‘and’’ at the end; 14 (B) in subparagraph (D), by striking the 15 period at the end and inserting ‘‘; and’’; and 16 (C) adding at the end the following new 17 subparagraph: 18 ‘‘(E) tantalum.’’. 19 (3) PROHIBITION ON SALES OF MATERIALS.— 20 Section 2533c(a)(2) of title 10, United States Code, 21 is amended by striking ‘‘covered’’ before ‘‘material’’. 22 Æ VerDate Sep 11 2014 05:04 Jul 09, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6301 E:\BILLS\H3567.IH H3567 kjohnson on DSK79L0C42 with BILLS