Top House lawmakers launch investigation into Pentagon redirecting COVID-19 funds

The heads of several House subpanels on Friday called for the Pentagon to turn over documents on how it used $1 billion in coronavirus relief funds, citing the Defense Department’s use of much of the money to pay defense contractors rather than buy medical supplies.

“We are investigating whether the Department of Defense (DOD) inappropriately used hundreds of millions of taxpayer dollars appropriated by Congress in the Coronavirus Aid, Relief, and Economic Security (CARES) Act,” lawmakers wrote in a letter to Defense Secretary Mark Esper.

“These funds were intended to prioritize the domestic production and distribution of urgently needed medical supplies and personal protective equipment (PPE) – many of which are still in short supply – but DOD has reportedly diverted a significant portion of these funds to provide lucrative contracts to defense contractors for non-medical projects.”

The letter was sent by the Select Subcommittee on the Coronavirus Crisis Chairman Rep. James Clyburn (D-S.C.); Committee on Financial Services Chairwoman Rep. Maxine Waters (D-Calif.); Committee on Oversight and Reform Chairwoman Rep. Carolyn Maloney (D-N.Y.); and Subcommittee on National Security Chairman Rep. Stephen Lynch (D-Mass.).

The Washington Post first reported last month that the Pentagon has used most of the $1 billion on defense contractors rather than medical supplies.

The department awarded contracts for jet engine parts, body armor and dress uniforms, among other military equipment, which critics argue is in contravention of the CARES Act stipulation that the funds be used to “prevent, prepare for and respond to coronavirus.”

Following the report’s release, the Pentagon defended itself, arguing the money was never intended to be restricted to medical supplies, that it kept Congress fully informed of its plans and that helping the defense industrial bases through the pandemic is an appropriate response to the COVID-19 crisis.

The department had also notified Congress in late May that it planned to use $688 million of the funding to shore up the defense industrial base. 

The lawmakers, however, point to medical supplies and PPE shortages which have persisted more than six months after the Trump administration declared the coronavirus pandemic a national emergency.

While DOD may rightly argue that the goal of its spending was to offset financial distress in the defense industrial base caused by the pandemic, the lawmakers say, the use of CARES Act dollars in this manner “runs counter to Congress’ intent that these appropriations be prioritized to address shortages in medical supplies and equipment.”

The lawmakers asked Esper to hand over documents that show how the Pentagon spent its CARES act money, including the recipient of every contract funded by the money, the amount, the date of the award, what was provided and which senior contracting officer signed off on it.

They also want to know whether the contract recipient received other CARES Act funding, whether they had relevant past performance with DOD, and “all documents related to the decision to use CARES Act funding to stimulate the defense industrial base rather than to support production and distribution of PPE.”

The letter asks for the documents and information by Oct. 16, as well as a staff briefing by that time “to address these issues.”

The letter follows calls from Sen. Elizabeth Warren (D-Mass.) and Rep. Ro Khanna (D-Calif.) for the Pentagon’s inspector general to investigate how the department used its coronavirus relief funds.

The two in late September asked the watchdog to “review the potential misuse of funds by the department that were meant ‘to prevent, prepare for, and respond to coronavirus, domestically or internationally.’”

A coalition of 40 organizations from across the political spectrum also last month called for a congressional investigation into how DOD spent the money.