The fiscal year 2019 National Defense Authorization Act contains numerous provisions that aim to enhance innovation in defense technologies and combat foreign efforts to exploit U.S. R&D. It postpones a proposal to reform the relationship between the National Nuclear Security Administration and the Department of Energy.
On Aug. 13, President Trump signed into law the John S. McCain National Defense Authorization Act (NDAA) for Fiscal Year 2019 during a visit to Fort Drum in upstate New York. The legislation updates policy and makes line-item funding recommendations for the Department of Defense and National Nuclear Security Administration. As usual, it includes numerous provisions related to R&D, nuclear weapons, and other major defense technologies.
Passing a new version of the NDAA is considered one of Congress’ most important annual tasks. A conference committee negotiates the final version based on proposals included in two bills the House and Senate Armed Services Committees develop independently. The conference report accompanying the final version details which proposals it includes, excludes, and amends, and in many cases explains the conference committee’s underlying rationale
When the Senate passed this year’s conference bill on Aug. 1 on a vote of 87 to 10, it marked the earliest point in the year Congress has completed work on the NDAA in decades. The House passed the conference bill on July 26 on a vote of 359 to 54.
Law focuses on expediting technology development
In recent years, Congress has focused heavily on improving DOD’s ability to develop and implement new technologies. Its objective has been to maintain U.S. forces’ combat superiority in the face of emerging threats from China and other “near peer” rivals.
In the fiscal year 2017 NDAA, Congress directed DOD to create the position of under secretary of defense for research and engineering (USD(R&E)) to invigorate the department’s R&D activities and smooth the transition of technologies into acquisition programs. After the Senate confirmed former NASA Administrator Mike Griffin to the position in February, congressional attention turned to setting policies to aid and direct him in his work.
National Defense Science and Technology Strategy. The NDAA directs DOD to assemble a strategy articulating its S&T priorities, goals, and investments, and offering recommendations on the future of the defense research and engineering enterprise. The strategy will consider DOD workforce capabilities; facilities and infrastructure; relationships with academia, industry, and the operational community; interagency partnerships; and coordination between R&D and acquisition activities.
Identification of critical technological capabilities. DOD is also required to submit a series of reports to Congress comparing the capabilities of the U.S. and its adversaries in “emerging technology areas,” including but not limited to hypersonics, artificial intelligence, quantum information science (QIS), and directed energy. A separate provision directs DOD to maintain a list of “acquisition programs, technologies, manufacturing capabilities, and research areas that are critical for maintaining the national security technological advantage of the United States over foreign countries of special concern.”
Rapid reaction in emerging technologies. DOD is directed to establish procedures for designating and expediting the development of technologies that are rapidly emerging, responsive to emerging adversary capabilities, or otherwise “not receiving appropriate research funding or attention.” A separate provision codifies and reauthorizes DOD’s existing Rapid Innovation Program.
Quantum information science. DOD is directed to establish a coordinated R&D program in QIS that will focus on sensors and metrology, communications and cryptography, materials and molecular function design, quantum device manufacturing, quantum computing algorithms, optimized analysis of national security data sets, and QIS-related mathematics.
Directed energy. The NDAA extends through fiscal year 2019 the authority accorded to the USD(R&E) to undertake a coordinated prototyping program in directed energy weapon systems and provides guidelines for carrying out directed energy testing. It also clarifies that the purview of the Joint Directed Energy Transition Office includes work on high-powered microwave capabilities.
Strategic Capabilities Office. DOD is directed to submit a plan outlining the future of its Strategic Capabilities Office (SCO) that could include eliminating it, transferring its functions elsewhere, or retaining it. SCO, which now has a budget of over $1 billion, is responsible for seeking new tactical uses for existing and near-term technologies. The House had proposed that DOD prepare a plan for SCO’s dissolution. DOD recently named Chris Shank as successor to the office’s founding director, physicist Will Roper. Shank was previously director of strategic investments at NASA during Griffin’s tenure as administrator and more recently was a high-level staff member with the House Science Committee.
Defense Innovation Unit Experimental. DOD is directed to submit a report to Congress on the Defense Innovation Unit Experimental (DIUx), which builds relationships with universities and companies in regional U.S. innovation hubs. The report is to include an analysis of DIUx’s role within DOD and an account of its activities and their impacts. Like SCO, DIUx was created by DOD to help the department become more agile in developing its technological capabilities. Last week, DOD announced it is dropping the word “Experimental” from the unit’s name to indicate it will be a permanent part of the department.
Changes to authority of USD(R&E) omitted. The final NDAA does not contain a Senate proposal to give the USD(R&E) direct authority over R&D programs in priority areas such as directed energy and hypersonics. Explaining the omission, the conference report points to “the existing discretion of the Secretary of Defense to delegate authority within the Department of Defense.” A House proposal to transfer responsibility over aspects of missile defense R&D from the USD(R&E) to the Missile Defense Agency was also not adopted.
Provisions target foreign efforts to exploit US R&D
The NDAA also seeks to hinder attempts by China and other rival nations to gain access to the fruits of R&D conducted at U.S. companies and universities.
Policy toward China. The NDAA directs the president to submit a “whole-of-government” strategy for China. Among elements to be included are planned responses to China’s “use of intelligence networks to exploit open research and development” and its “use of economic tools, including market access and investment to gain access to sensitive United States industries.” A separate provision specifies that in its annual report on China, DOD’s assessment of Chinese efforts to gain access to U.S. technology should take into account “investment, industrial espionage, cybertheft, academia, and other means.”
Initiative to protect academic research. The NDAA directs DOD to establish an “initiative” to support academic institutions’ efforts to protect national security-relevant intellectual property, technologies, and key personnel from foreign exploitation. The initiative would also act to “limit undue influence, including through foreign talent programs, by countries to exploit United States technology within the Department of Defense research, science and technology, and innovation enterprise.” DOD is also directed to establish policies to “limit or prohibit funding … for institutions or individual researchers who knowingly violate regulations developed under the initiative, including regulations relating to foreign talent programs.” The provision replaces a House proposal that would have authorized DOD to withhold funding to research groups that include members who have participated in talent recruitment programs operated by China, Iran, North Korea, or Russia.
Export controls on sensitive technologies. A major element of this year’s NDAA is a set of reforms increasing the power of the interagency Committee on Foreign Investment in the United States (CFIUS) to block business transactions with national security implications. Included in these reforms is a requirement that the federal government create a mechanism for identifying “emerging and foundational technologies” that are “essential” to national security and establish controls on their export.
Procedures to limit foreign access to technology. DOD is similarly directed to “develop a process and procedures for limiting foreign access to technology through contracts, grants, cooperative agreements, or other transactions, when such limitation is in the interest of national security.”
Defense labs gain new mechanisms for collaboration
The final version of the NDAA adopts most of the proposed adjustments in policy for DOD laboratories.
Open campus program. The NDAA authorizes DOD to create programs modeled on the Army Research Laboratory’s open campus program at other DOD laboratories. The earlier proposed version of this provision pertained only to the Air Force Research Laboratory.
Collaborative arrangements with universities. DOD is directed to establish through an authority created by last year’s NDAA at least three collaborative arrangements to “facilitate expedited access to university technical expertise, including faculty, staff, and students.” The authority is also extended through fiscal year 2022, and space, infrastructure resilience, photonics, and autonomy are added to the list of subject areas to which it applies. Another provision authorizes DOD laboratories to work with state, local, or nonprofit entities that facilitate partnerships with regional businesses and academic institutions.
Nonprofit entity to support technology collaboration. The NDAA directs DOD to initiate “interaction” with industry and academia to support the development of “emerging hardware products and technologies with national security applications,” and authorizes up to $75 million for the effort. It also directs DOD to establish a nonprofit entity to facilitate these interactions. The conference report identifies microelectromechanical systems, processing components, micromachinery, and materials science as examples of relevant technology areas.
Information repository for small businesses. The Defense Technical Information Center is directed to establish a repository of information on the technological capabilities of small innovative businesses that DOD has engaged with in order to facilitate future interactions.
Hiring and management authorities. The NDAA includes several provisions adjusting existing authorities for recruiting and hiring personnel who have technical expertise and who are just completing studies at post-secondary and graduate institutions. It also extends special recruiting authorities for DOD labs to SCO and DIUx. The conference report notes that existing direct hire authority already applies to graduates of Historically Black Colleges and Universities and other minority-serving institutions. Accordingly, the final NDAA directs DOD to submit a report on its engagement with these institutions rather than adopting a proposal to create a new authority specific to them.
Entrepreneurship and sabbatical provisions omitted. The NDAA does not include a House proposal to authorize DOD to establish a program to provide training in commercialization and entrepreneurship for DOD lab personnel. However, it does add DOD’s Innovation Corps program to a list of organizations and programs DOD may coordinate with in implementing an existing authority to support national security innovation and entrepreneurial education. Another House proposal to direct DOD to prescribe regulations permitting lab personnel to take sabbaticals in the private sector was also not included. The conference report directs DOD to report to Congress on its use of existing authorities permitting sabbaticals.
STEM jobs action plan omitted. The NDAA does not include a House proposal to direct DOD to assess its future requirements for personnel in STEM fields and to develop a plan to meet those requirements.
DOD SBIR/STTR programs not made permanent. A Senate proposal to permanently authorize DOD’s Small Business Innovation Research and Small Business Technology Transfer programs was not adopted.
Congress defers on nuclear weapons, Space Force, missile defense
The House and Senate NDAA bills contained proposals that would have had major implications for the National Nuclear Security Administration and DOD’s space and missile defense activities. The final bill defers immediate action on the strongest proposals or makes them contingent on the appropriation of funding. Spending bills for fiscal year 2019 are still pending in Congress.
NNSA reform postponed. The NDAA did not adopt a Senate proposal to transfer ultimate authority over many NNSA activities from the secretary of energy to the NNSA administrator. The conference report notes the 2014 Augustine-Mies report recommended that the Department of Energy “solidify Cabinet Secretary ownership” over NNSA’s mission. The conference report also observes that another NNSA study currently being conducted through the National Academies of Sciences, Engineering, and Medicine and National Academy of Public Administration will conclude its work in 2020, and suggests Congress should “consider major reforms to the governance of the nuclear security enterprise” at that time.
Nuclear Weapons Council. The NDAA makes the USD(R&E) a member of Nuclear Weapons Council, an interagency body responsible for coordinating DOD and DOE activities relating to the management of the U.S. nuclear weapons stockpile.
NNSA–DOD personnel exchange. The NDAA directs the chair of the Nuclear Weapons Council and NNSA administrator establish a personnel exchange program to improve familiarity and integration among the various branches of the U.S. nuclear security enterprise. The conference report further instructs the two organizations to plan a similar program to improve the nation’s nuclear nonproliferation efforts.
Low-yield nuclear warhead. Responding to the Trump administration’s proposal to develop a new type of low-yield nuclear warhead for submarine-launched ballistic missiles, the NDAA authorizes NNSA to proceed with the project, contingent on a specific request from the administration for appropriations. The NDAA also modifies statute to permit NNSA to carry out a nuclear weapon development or modification program, regardless of yield, only if Congress authorizes funds for the program.
Plutonium disposal facility. The NDAA directs NNSA to continue construction of the Mixed Oxide (MOX) Fuel Fabrication Facility in South Carolina, which is designed to convert plutonium from nuclear warheads into usable nuclear fuel. Earlier this year, NNSA announced it would discontinue construction of the plant and use the site to produce new plutonium pits required to maintain the U.S. nuclear stockpile. The Senate had proposed prohibiting NNSA from using funds to terminate construction but the final law preserves the option to halt construction.
Plutonium pit production. Although NNSA has already announced plans to split the production of new plutonium pits between Los Alamos National Laboratory in New Mexico and the Savannah River Site in South Carolina, lawmakers from those states have resisted the proposal. Accordingly, the NDAA directs DOD and NNSA to commission a further study of the matter.
Organization of military space activities. The NDAA continues an ongoing House-led effort to reform DOD and the Air Force’s space activities, including by creating a U.S. Space Command under U.S. Strategic Command. However, it omits proposals that would have created a Numbered Air Force dedicated to space warfighting operations and directed DOD to create a plan to augment its civilian and military “space cadre.” In his remarks prior to signing the NDAA, Trump reiterated his own commitment to creating a Space Force as a sixth branch of the U.S. Armed Forces, but the law does not address that proposal.
Space-based missile defense. The NDAA adopts Senate proposals directing DOD to begin work on a space-based missile defense system and sensor architecture but adds the stipulation that work on these systems be subject to the availability of appropriations.
Missile defense testing. The NDAA includes a Senate provision encouraging the Missile Defense Agency to “pursue an increasingly rigorous testing regime,” but omits proposed language indicating that tests that do not achieve an intercept or their main objective should not be considered “failures.”
Hypersonic capabilities. The Missile Defense Agency is directed to accelerate its work on hypersonic missile defense, but a Senate proposal encouraging the Air Force to partner with universities to advance next-generation hypersonic capabilities was omitted from the final NDAA.