Sec. 1411. IMPROVEMENTS TO STRATEGIC AND CRITICAL MATERIALS STOCK PILING ACT

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## SEC. 1411 IMPROVEMENTS TO STRATEGIC AND CRITICAL MATERIALS STOCK PILING ACT ###

(a)Purposes Section 2 of the Strategic and Critical Materials Stock Piling Act (50 U.S.C. 98a) is amended by adding at the end the following new subsection: > > ### “(d) > > To the maximum extent practicable and to reduce the reliance of the National Defense Stockpile program on appropriated funds, the National Defense Stockpile Manager shall seek to achieve positive cash flows from the recovery of strategic and critical materials pursuant to section 6(a)(5).” > . ###

(b)Stockpile Management Section 6 of such Act (50 U.S.C. 98e) is amended— ####

(1)in subsection (a)(5), by striking “from excess” and all that follows and inserting “from other Federal agencies, either directly as materials or embedded in excess-to-need, end-of-life items, or waste streams;”; ####

(2)in subsection (c)(1), by striking “subsection (a)(5) or (a)(6)” and inserting “subsection (a)(6) or (a)(7)”; ####

(3)in subsection (d)(2), by striking “subsection (a)(5)” and inserting “subsection (a)(6)”; and ####

(4)by adding at the end the following new subsections: > > ### “(g) > > > ####

(1)> > The National Defense Stockpile Manager shall establish a pilot program to use, to the maximum extent practicable, commercial best practices in the acquisition and disposal of strategic and critical materials for the stockpile. > > > #### “(2) > > > #####

(A)> > The Stockpile Manager shall brief the congressional defense committees (as defined in section 101(a) of title 10, United States Code)— > > > ###### “(i) > > as soon as practicable after the establishment of the pilot program under paragraph (1); and > > > ###### “(ii) > > annually thereafter until the termination of the pilot program under paragraph (3). > > > ##### “(B) > > The briefing required by subparagraph (A)(i) shall address— > > > ###### “(i) > > the commercial best practices selected for use under the pilot program; > > > ###### “(ii) > > how the Stockpile Manager determined which commercial best practices to select; and > > > ###### “(iii) > > the plan of the Stockpile Manager for using such practices. > > > ##### “(C) > > Each briefing required by subparagraph (A)(ii) shall provide a summary of— > > > ###### “(i) > > how the Stockpile Manager has used commercial best practices under the pilot program during the year preceding the briefing; > > > ###### “(ii) > > how many times the Stockpile Manager has used such practices; > > > ###### “(iii) > > the outcome of each use of such practices; and > > > ###### “(iv) > > any savings achieved or lessons learned as a result of the use of such practices. > > > #### “(3) > > The pilot program established under paragraph

(1)shall terminate effective on the date that is 5 years after the date of the enactment of the National Defense Authorization Act for Fiscal Year 2024. > > > ### “(h) > > Except to the extent necessary for the national defense, the National Defense Stockpile Manager shall ensure that each program for the recovery of strategic and critical materials implemented under subsection (a)(5) operates in a manner designed to achieve positive cash flow.” > . ###

(c)Strategic and Critical Materials Board of Directors Section 10 of such Act (50 U.S.C. 98h-1) is amended— ####

(1)in subsection (c)— #####

(A)in paragraph (4), by striking “of the National Defense Stockpile Manager” and inserting “of the management and operations of the National Defense Stockpile program”; #####

(B)by striking paragraph

(5)and redesignating paragraphs

(6)through

(10)as paragraphs

(5)through (9), respectively; and #####

(C)in paragraph (7), as so redesignated— ######

(i)by striking “required by section 11(a)(2) of this Act, including a review of” and inserting “required by section 11(a) of this Act.Recommenda-tions. The report required by section 11(b)(2) shall include the views and recommendations of the Board on”; and ######

(ii)by striking “proposed actions to be taken under the Annual Materials and Operations Plan” and inserting “all acquisition of materials for and disposals of materials from the stockpile”; and ####

(2)by amending subsection

(e)to read as follows: > > ### “(e) Application of Provisions Relating to Federal Advisory Committees > > Section 1013(a) of title 5, United States Code, shall not apply to the Board.” > . ###

(d)Reports Section 11 of such Act (50 U.S.C. 98h-2) is amended— ####

(1)in subsection (a), by striking “the following:” and all that follows and inserting “an Annual Materials and Operations Plan for the forthcoming year.”; ####

(2)in subsection (b)— #####

(A)in paragraph (1)— ######

(i)in the heading— ######

(I)by striking “Reports” and inserting “Report”; and ######

(II)by striking “manage” and inserting “manager”; ######

(ii)in the matter preceding subparagraph (A)— ######

(I)by striking “90 days after the conclusion of the fourth quarter of each fiscal year” and inserting “February 15 of each fiscal year”; and ######

(II)by striking “a report” and inserting “an Annual Operations and Materials Plan”; ######

(iii)by amending subparagraph

(E)to read as follows: > > ##### “(E) > > a statement and explanation of the financial status of the National Defense Stockpile Transaction Fund and anticipated appropriations to be made to the Fund, and obligations to be made from the fund, during the current fiscal year;” > ; and ######

(iv)by striking subparagraphs

(G)and

(H)and inserting the following: > > ##### “(G) > > an annual materials plan for the operation of the stockpile during the next fiscal year and the succeeding four fiscal years and planned expenditures from the National Defense Stockpile Transaction Fund and anticipated receipts from disposal of stockpile materials, which shall include— > > > ###### “(i) > > details of all planned expenditures from the National Defense Stockpile Transaction Fund during such period and of anticipated receipts from the proposed disposals of stockpile materials during such period; > > > ###### “(ii) > > details regarding materials development and research projects to be conducted during the fiscal years covered by the report using moneys in the National Defense Stockpile Transaction Fund pursuant to section 9(b)(2)(G); and > > > ###### “(iii) > > with respect to each development and research project described in clause (ii), the report shall specify the amount planned to be expended from the National Defense Stockpile Transaction Fund, the material intended to be developed, the potential military or defense industrial applications for that material, and the development and research methodologies to be used; > > > ##### “(H) > > any proposed expenditure or disposal detailed in the annual materials plan for any such fiscal year, and any expenditure or disposal proposed in connection with any transaction submitted for such fiscal year to the appropriate committees of Congress pursuant to section 5(a)(2) that is not obligated or executed in that fiscal year may not be obligated or executed until such proposed expenditure or disposal is resubmitted in a subsequent annual materials plan or is resubmitted to the appropriate committees of Congress in accordance with section 5(a)(2), as appropriate; and > > > ##### “(I) > > a summary of the implementation and findings of the pilot program established under section 6(g)(1), including— > > > ###### “(i) > > the commercial best practices selected for use under the pilot program; > > > ###### “(ii) > > how the National Defense Stockpile Manager determined which commercial best practices to select; > > > ###### “(iii) > > how the National Defense Stockpile Manager has used commercial best practices under the pilot program during the year preceding the briefing; > > > ###### “(iv) > > the outcome of each use of such practices; and > > > ###### “(v) > > any savings achieved or lessons learned as a result of the use of such practices.” > ; and #####

(B)in paragraph (2), by striking “paragraph (1)” and all that follows and inserting “paragraph

(1)which shall include the activities of the Board to carry out the duties listed in section 10(c) of this Act”. ###

(e)Development and Conservation of Reliable Sources ####

(1)In general Section 15 of such Act (50 U.S.C. 98h-6) is amended to read as follows: > > ## “SEC. 15 DEVELOPMENT AND CONSERVATION OF RELIABLE SOURCES > > > ### “(a) Duties > > Subject to subsection (d), the National Defense Stockpile Manager shall encourage the development and appropriate conservation of reliable sources of strategic and critical materials— > > > #### “(1) > > by purchasing, or making a commitment to purchase, strategic and critical materials from reliable sources when such materials are needed for the stockpile; > > > #### “(2) > > by contracting with facilities located in and owned and controlled by reliable sources, or making a commitment to contract with such facilities, for the processing or refining of strategic and critical materials in the stockpile when processing or refining is necessary to convert such materials into a form more suitable for storage or disposition or meeting stockpile requirements; > > > #### “(3) > > by qualifying facilities located in and owned and controlled by reliable sources, or qualifying strategic and critical materials produced by such facilities, to meet stockpile requirements; > > > #### “(4) > > by contracting with facilities located in and owned and controlled by reliable sources to recycle strategic and critical materials to meet stockpile requirements or increase the balance of the National Defense Stockpile Transaction Fund under section 9; and > > > #### “(5) > > by entering into an agreement to co-fund a bankable feasibility study for a project for the development of strategic and critical materials located in and owned and controlled by a reliable source, if the agreement— > > > ##### “(A) > > limits the liability of the stockpile to not more than the total funding provided by the Federal Government; > > > ##### “(B) > > limits the funding contribution of the Federal Government to not more than 50 percent of the cost of the bankable feasibility study; and > > > ##### “(C) > > does not obligate the Federal Government to purchase strategic and critical materials from the reliable source. > > > ### “(b) Additional Authorities > > > #### “(1) Extended contracting authority > > > ##### “(A) In general > > The term of a contract or commitment made under subsection

(a)may not exceed ten years. > > > ##### “(B) Preexisting contracts > > A contract entered into before the date of the enactment of the National Defense Authorization Act for Fiscal Year 2024 for a term of more than ten years may be extended, on or after such date of enactment, for a total of not more than an additional ten years pursuant to any option or options set forth in the contract. > > > #### “(2) Matters relating to co-funding of bankable feasibility studies > > To the extent authorized by Congress pursuant to the Defense Production Act of 1950 (50 U.S.C. 4501 et seq.) and determined to be required by the President pursuant to that Act, the National Defense Stockpile Manager may provide for loans or procure debt issued by other entities to carry out a project for the development of strategic and critical materials with respect to which a study was carried out under subsection (a)(5). > > > ### “(c) Proposed Transactions Included in Annual Materials Plan > > Descriptions of proposed transactions under subsection

(a)shall be included in the Annual Materials and Operations Plan. Changes to any such transaction, or the addition of a transaction not included in such plan, shall be made in accordance with section 5(a)(2). > > > ### “(d) Availability of Funds > > The authority of the National Defense Stockpile Manager to enter into obligations under this section is effective for any fiscal year only to the extent that funds in the National Defense Stockpile Transaction Fund under section 9 are adequate to meet such obligations. > > > ### “(e) Bankable Feasibility Study Defined > > In this section, the term ‘bankable feasibility study’ means a comprehensive technical and economic study— > > > #### “(1) > > of the selected option for a strategic and critical materials development project that includes appropriately detailed assessments of realistically assumed extraction, processing, metallurgical, economic, marketing, legal, environmental, social, and governmental considerations and any other relevant operational factors and detailed financial analysis, that are necessary to demonstrate at the time of reporting that production is reasonably justified; and > > > #### “(2) > > that may reasonably serve as the basis for a final decision by a proponent of a project or financial institution to proceed with, or finance, the development of the project.” > . ####

(2)Conforming amendments #####

(A)Significant stockpile transaction change report Section 5(a)(2) of such Act (50 U.S.C. 98d(a)(2)) is amended by striking “the Board” and inserting “the National Defense Stockpile Manager”. #####

(B)Materials research and development Section 8(a) of such Act (50 U.S.C. 98g(a)) is amended— ######

(i)in paragraph (1), by striking “or in its territories or possessions,” and inserting “its territories or possessions, or in a reliable source”; and ######

(ii)in paragraph (2), by striking “in order to—” and all that follows and inserting the following: “in order to develop new sources of strategic and critical materials, develop substitutes, or conserve domestic 137 STAT. 528 sources and reliable sources of supply for such strategic and critical materials.”. #####

(C)Definitions Section 12 of such Act (50 U.S.C. 98h-3) is amended by striking paragraph

(3)and inserting the following new paragraph: > > #### “(3) > > The term ‘reliable source’ mean a citizen or business entity organized under the laws of— > > > ##### “(A) > > the United States or any territory or possession of the United States; > > > ##### “(B) > > a country of the national technology and industrial base, as such term is defined in section 4801 of title 10, United States Code; or > > > ##### “(C) > > a qualifying country, as defined in section 225.003 of the Defense Federal Acquisition Regulation Supplement or any successor document.” > .

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