Sending Office: Honorable Jackie Speier
Original co-sponsors (6): Jackie Speier, Mark Meadows, John Duncan, Jason Lewis, Ted Lieu, Jamie Raskin
Additional co-sponsors (1): Ro Khanna
A GAO Report found that the Defense Department gave away $8.5 billion in foreign military sales waivers to Saudi Arabia, Qatar, the UAE, and Kuwait from FY2012-17. The reason? Those countries claimed they couldn’t pay small non-recurring costs and DOD took
them at their word.
When DOD sells foreign governments weapons, staffers are supposed to collect per-unit shares of non-recurring, one-time costs (such as research and development) from partners in addition to the costs of producing a system. The Arms Export Control Act allows
DOD to waive these charges if foreign governments wouldn’t make the purchase without a waiver, a waiver would enable equipment standardization with allies, or the economies of scale from increased production would save the United States money.
Astoundingly, DOD approved 813 of 816 waiver applications from FY12-17, worth a total of $16 billion. DOD staff did minimal investigation into waiver applications, simply rubberstamping applications to expedite foreign military sales. These sales and defense
relationships matter, but there’s no reason taxpayers should be footing an $8.5 billion bill for some of the wealthiest countries in the world.
The Return Expenses Paid and Yielded (REPAY) Act, H.R. 6296, would address mismanagement of the waiver and other foreign military sales processes in a number of ways:
1. Requiring Congressional notification of any loss of sale or standardization non-recurring cost waivers approved as part of the sale of any major defense equipment to a foreign country, including the size of the waiver and a detailed justification for
2. Including that information in quarterly Congressional reports on Foreign Military Sales, along with updates on the real values of previously approved waivers.
3. Limiting countries’ eligibility for loss of sale waivers when they demonstrate consistent, high-value purchasing patterns and eliminates little-used economy of scale waivers.
4. Requiring a DSCA report on how it sets administrative fees and its account management.
5. Tasking DSCA with setting an upper bound on its collected fee accounts, biannually review fees charged, and makes it possible for those fees to cover certain FMS personnel costs.
6. Requiring DSCA to develop better FMS program performance measures and tracking.
7. Mandating a GAO report on DSCA’s management of its budget model.
Please contact Mitchel Hochberg
Mitchel.firstname.lastname@example.org, x54898, for a copy of the bill, to sign on, or with any questions.
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