Made in America Shipbuilding Act of 2020

II 116TH CONGRESS 2D SESSION S. 4687 To expand domestic content requirements for certain shipboard components, and for other purposes. IN THE SENATE OF THE UNITED STATES SEPTEMBER 24, 2020 Ms. BALDWIN introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental Affairs A BILL To expand domestic content requirements for certain shipboard components, 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 ‘‘Made in America Ship- 4 building Act of 2020’’. 5 SEC. 2. DOMESTIC SHIPBUILDING REQUIREMENT. 6 (a) IN GENERAL.—The head of an executive agency 7 may not enter into a contract related to the acquisition, 8 construction, or conversion of a vessel unless the vessel 9 is to be constructed or converted in the United States. 10 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 2 •S 4687 IS (b) EXECUTIVE AGENCY DEFINED.—In this section, 1 the term ‘‘executive agency’’ has the meaning given the 2 term in section 133 of title 41, United States Code. 3 SEC. 3. DOMESTIC SOURCING REQUIREMENT FOR SHIP- 4 BOARD COMPONENTS. 5 (a) IN GENERAL.—Chapter 47 of title 41, United 6 States Code, is amended by adding at the end the fol- 7 lowing new section: 8 ‘‘§ 4714. Domestic sourcing requirement for ship- 9 board components 10 ‘‘(a) REQUIREMENT FOR UNITED STATES MANUFAC- 11 TURE.— 12 ‘‘(1) LIMITATION ON PROCUREMENTS.—The 13 head of an executive agency may procure any of the 14 following components for vessels only if the items 15 are manufactured in the United States: 16 ‘‘(A) IN GENERAL.—The following compo- 17 nents for vessels: 18 ‘‘(i) Air circuit breakers. 19 ‘‘(ii) Welded shipboard anchor and 20 mooring chain with a diameter of four 21 inches or less. 22 ‘‘(iii) Auxiliary equipment, including 23 pumps, for all shipboard services. 24 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 3 •S 4687 IS ‘‘(iv) Propulsion system components, 1 including main propulsion engines, hybrid 2 drive systems, propulsion shafting, engine 3 crankshafts, reduction gears, and propel- 4 lers. 5 ‘‘(v) Shipboard cranes. 6 ‘‘(vi) Spreaders for shipboard cranes. 7 ‘‘(vii) Power Distribution equipment, 8 Energy Store Systems, energy storage/ 9 magazine equipment. 10 ‘‘(viii) Auxiliary propulsion units and 11 systems, including bow and tunnel thrust- 12 ers, waterjets, dynamic positioning sys- 13 tems, and hybrid propulsion systems. 14 ‘‘(ix) Ship service and emergency 15 power generation equipment (prime movers 16 and generators). 17 ‘‘(x) Military Qualified Wire and 18 Cable and derived products. 19 ‘‘(xi) Specialized Valves for pneu- 20 matic, fuel, firefighting, countermeasure 21 wash down, and chilled water systems. 22 ‘‘(xii) Low voltage (LV) and high volt- 23 age (HV) switchgear. 24 ‘‘(xiii) Power converters. 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 4 •S 4687 IS ‘‘(xiv) Power inverters. 1 ‘‘(xv) Frequency converters. 2 ‘‘(xvi) Aircraft Electrical Starting 3 Stations (AESS). 4 ‘‘(xvii) Degaussing systems. 5 ‘‘(xviii) Static Automatic Bus Trans- 6 fer Switches (SABTs). 7 ‘‘(xix) Inertial navigation systems and 8 gyrocompass. 9 ‘‘(xx) Capstans. 10 ‘‘(xxi) Winches. 11 ‘‘(xxii) Hoists. 12 ‘‘(xxiii) Outboard motors. 13 ‘‘(xxiv) Windlasses. 14 ‘‘(B) OTHER COMPONENTS.—The following 15 components of vessels, to the extent they are 16 unique to marine applications: gyrocompasses, 17 electronic navigation chart systems, steering 18 controls, pumps, propulsion and machinery con- 19 trol systems, and totally enclosed lifeboats. 20 ‘‘(C) VALVES AND MACHINE TOOLS.— 21 Items in the following categories: 22 ‘‘(i) Powered and non-powered valves 23 in Federal Supply Classes 4810 and 4820 24 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 5 •S 4687 IS used in piping for naval surface ships and 1 submarines. 2 ‘‘(ii) Machine tools in the Federal 3 Supply Classes for metal-working machin- 4 ery numbered 3405, 3408, 3410 through 5 3419, 3426, 3433, 3438, 3441 through 6 3443, 3445, 3446, 3448, 3449, 3460, and 7 3461. 8 ‘‘(2) APPLICABILITY TO CERTAIN ITEMS.— 9 Paragraph (1) does not apply to a procurement of 10 spare or repair parts needed to support components 11 for vessels produced or manufactured outside the 12 United States. 13 ‘‘(3) WAIVER AUTHORITY.—The head of an ex- 14 ecutive agency may waive the limitation in para- 15 graph (1) with respect to the procurement of an 16 item listed in that paragraph if the head of the 17 agency determines that any of the following apply: 18 ‘‘(A) Application of the limitation would 19 increase the cost of the overall acquisition by 20 more than 25 percent or cause unreasonable 21 delays to be incurred. 22 ‘‘(B) Satisfactory quality items manufac- 23 tured by a domestic entity are not available or 24 domestic production of such items cannot be 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 6 •S 4687 IS initiated without significantly delaying the 1 project for which the item is to be acquired. 2 ‘‘(C) Application of the limitation would 3 result in the existence of only one domestic 4 source for the item. 5 ‘‘(D) Application of the limitation is not in 6 the national security interests of the United 7 States. 8 ‘‘(4) IMPLEMENTATION OF WAIVER AUTHOR- 9 ITY.— 10 ‘‘(A) NON-DELEGATION OF AUTHORITY.— 11 The head of an agency may not delegate the 12 waiver authority under paragraph (3). 13 ‘‘(B) PUBLICATION.—Not later than 30 14 days after exercising the waiver authority under 15 paragraph (3), the head of the agency shall 16 publish in an easily identifiable location on the 17 website of the agency information regarding the 18 waiver, including a detailed justification for the 19 waiver. 20 ‘‘(5) ANNUAL REPORT.—Not later than 180 21 days after the end of each fiscal year, the head of 22 each executive agency that has used a waiver de- 23 scribed in this section in the fiscal year shall submit 24 to the Committee on Homeland Security and Gov- 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 7 •S 4687 IS ernmental Affairs of the Senate and the Committee 1 on Oversight and Reform of the House of Represent- 2 atives a report on the total amount of waivers used 3 and detailed information regarding and justification 4 for the waiver. 5 ‘‘(b) COMPONENTS CONTAINING SPECIALTY MET- 6 ALS.— 7 ‘‘(1) LIMITATION ON PROCUREMENTS.—The 8 head of an executive agency may not enter into a 9 contract for the procurement of end items or compo- 10 nents for ships that contain a specialty metal not 11 melted or produced in the United States. 12 ‘‘(2) AVAILABILITY EXCEPTION.— 13 ‘‘(A) IN GENERAL.—Paragraph (1) does 14 not apply to the extent that the head of an ex- 15 ecutive agency determines that compliant spe- 16 cialty metal of satisfactory quality and suffi- 17 cient quantity, and in the required form, cannot 18 be procured as and when needed. For purposes 19 of the preceding sentence, the term ‘compliant 20 specialty metal’ means specialty metal melted or 21 produced in the United States. 22 ‘‘(B) APPLICABILITY.—This paragraph ap- 23 plies to prime contracts and subcontracts at 24 any tier under such contracts. 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 8 •S 4687 IS ‘‘(3) EXCEPTION FOR CERTAIN ACQUISI- 1 TIONS.—Paragraph (1) does not apply to the fol- 2 lowing: 3 ‘‘(A) Acquisitions outside the United 4 States in support of combat operations or in 5 support of contingency operations. 6 ‘‘(B) Acquisitions for which the use of pro- 7 cedures other than competitive procedures has 8 been approved on the basis of section 3304(c) 9 of this title, relating to unusual and compelling 10 urgency of need. 11 ‘‘(4) EXCEPTION RELATING TO AGREEMENTS 12 WITH FOREIGN GOVERNMENTS.—Paragraph (1) does 13 not preclude the acquisition of a specialty metal if— 14 ‘‘(A) the acquisition is necessary— 15 ‘‘(i) to comply with agreements with 16 foreign governments requiring the United 17 States to purchase supplies from foreign 18 sources for the purposes of offsetting sales 19 made by the United States Government or 20 United States firms under approved pro- 21 grams serving defense requirements; or 22 ‘‘(ii) in furtherance of agreements 23 with foreign governments in which both 24 such governments agree to remove barriers 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 9 •S 4687 IS to purchases of supplies produced in the 1 other country or services performed by 2 sources of the other country; and 3 ‘‘(B) any such agreement with a foreign 4 government complies, where applicable, with the 5 requirements of section 36 of the Arms Export 6 Control Act (22 U.S.C. 2776) and with section 7 2457 of title 10. 8 ‘‘(5) EXCEPTION FOR SMALL PURCHASES.— 9 Paragraph (1) does not apply to acquisitions in 10 amounts not greater than the simplified acquisition 11 threshold referred to in section 134 of this title. 12 ‘‘(6) EXCEPTION FOR PURCHASES OF ELEC- 13 TRONIC COMPONENTS.—Paragraph (1) does not 14 apply to acquisitions of electronic components, un- 15 less the head of the agency, with the concurrence of 16 the Secretary of Defense and upon the recommenda- 17 tion of the Strategic Materials Protection Board 18 pursuant to section 187 of title 10, determines that 19 the domestic availability of a particular electronic 20 component is critical to national security. 21 ‘‘(7) APPLICABILITY TO ACQUISITIONS OF COM- 22 MERCIAL ITEMS.— 23 ‘‘(A) IN GENERAL.—Except as provided in 24 subparagraphs (B) and (C), this section applies 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 10 •S 4687 IS to acquisitions of commercial items, notwith- 1 standing sections 1906 and 1907 of this title. 2 ‘‘(B) EXCEPTIONS.—This section does not 3 apply to contracts or subcontracts for the ac- 4 quisition of commercially available off-the-shelf 5 items, as defined in section 104 of this title, 6 other than— 7 ‘‘(i) contracts or subcontracts for the 8 acquisition of specialty metals, including 9 mill products, such as bar, billet, slab, 10 wire, plate and sheet, that have not been 11 incorporated into end items, subsystems, 12 assemblies, or components; 13 ‘‘(ii) contracts or subcontracts for the 14 acquisition of forgings or castings of spe- 15 cialty metals, unless such forgings or cast- 16 ings are incorporated into commercially 17 available off-the-shelf end items, sub- 18 systems, or assemblies; 19 ‘‘(iii) contracts or subcontracts for 20 commercially available high performance 21 magnets unless such high performance 22 magnets are incorporated into commer- 23 cially available off-the-shelf end items or 24 subsystems; and 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 11 •S 4687 IS ‘‘(iv) contracts or subcontracts for 1 commercially available off-the-shelf fas- 2 teners, unless such fasteners are— 3 ‘‘(I) incorporated into commer- 4 cially available off-the-shelf end items, 5 subsystems, assemblies, or compo- 6 nents; or 7 ‘‘(II) purchased as provided in 8 subparagraph (C). 9 ‘‘(C) INAPPLICABILITY TO CERTAIN FAS- 10 TENERS.—This subsection does not apply to 11 fasteners that are commercial items that are 12 purchased under a contract or subcontract with 13 a manufacturer of such fasteners, if the manu- 14 facturer has certified that it will purchase, dur- 15 ing the relevant calendar year, an amount of 16 domestically melted specialty metal, in the re- 17 quired form, for use in the production of such 18 fasteners for sale to executive agencies and 19 other customers, that is not less than 50 per- 20 cent of the total amount of the specialty metal 21 that it will purchase to carry out the production 22 of such fasteners. 23 ‘‘(8) EXCEPTIONS FOR PURCHASES OF SPE- 24 CIALTY METALS BELOW MINIMUM THRESHOLD.— 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 12 •S 4687 IS ‘‘(A) IN GENERAL.—Notwithstanding para- 1 graph (1), the head of an executive agency may 2 accept delivery of an item containing specialty 3 metals that were not melted in the United 4 States if the total amount of noncompliant spe- 5 cialty metals in the item does not exceed 2 per- 6 cent of the total weight of specialty metals in 7 the item. 8 ‘‘(B) EXCEPTION.—This paragraph does 9 not apply to high performance magnets. 10 ‘‘(9) STREAMLINED COMPLIANCE FOR COMMER- 11 CIAL DERIVATIVE MILITARY ARTICLES.— 12 ‘‘(A) IN GENERAL.—Paragraph (1) shall 13 not apply to an item acquired under a prime 14 contract if the head of an executive agency de- 15 termines that— 16 ‘‘(i) the item is a commercial deriva- 17 tive military article; and 18 ‘‘(ii) the contractor certifies that the 19 contractor and its subcontractors have en- 20 tered into a contractual agreement, or 21 agreements, to purchase an amount of do- 22 mestically melted specialty metal in the re- 23 quired form, for use during the period of 24 contract performance in the production of 25 VerDate Sep 11 2014 00:54 Oct 14, 2020 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S4687.IS S4687 kjohnson on DSK79L0C42PROD with BILLS 13 •S 4687 IS the commercial derivative military article 1 and the related commercial article, that is 2 not less than the greater of— 3 ‘‘(I) an amount equivalent to 120 4 percent of the amount of specialty 5 metal that is required to carry out the 6 production of the commercial deriva- 7 tive military article (including the 8 work performed under each sub- 9 contract); or 10 ‘‘(II) an amount equivalent to 50 11 percent of the amount of specialty 12 metal that is purchased by the con- 13 tractor and its subcontractors for use 14 during such period in the production 15 of the com [Text truncated for display. 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