Overnight Defense: Mike Rogers slated to be top House Armed Services Republican | Defense bill hits another snag | Pentagon dinged for $700M loan to trucking company using COVID funds

Happy Tuesday and welcome to Overnight Defense. I’m Rebecca Kheel, and here’s your nightly guide to the latest developments at the Pentagon, on Capitol Hill and beyond. CLICK HERE to subscribe to the newsletter.

THE TOPLINE: Republicans have found their new House Armed Services Committee leader.

Rep. Mike Rogers (Ala.) was elected Tuesday by the House GOP Steering Committee to serve as the top Republican on the powerful committee for the 117th Congress.

Rogers, who currently serves as the ranking member on the House Committee on Homeland Security, edged out Rep. Mike Turner (R-Ohio), the ranking member of the Armed Services Committee’s strategic forces subcommittee, and Rep. Rob Wittman (R-Va.) in the race. 

The full House GOP conference is expected to ratify the Steering Committee’s decision in the coming days.

The Alabama Republican is slated to succeed current ranking member Mac Thornberry (R-Texas), who announced his retirement in September of last year.

Why it matters: The razor-thin majority House Democrats will have in the next Congress, Republicans can expect to have more sway over crafting key policies in the committee’s signature annual bill, the National Defense Authorization Act (NDAA).

The committee has held onto a reputation for being strongly bipartisan even during times of a strong political divide. And with a number of political strategists projecting that Republicans have a strong chance of regaining control of the lower chamber in 2022, Rogers could soon hold the coveted gavel. 

Foreign Affairs gavel: Meanwhile, Rep. Gregory Meeks (D-N.Y.) won the House Democratic Steering Committee’s recommendation in the hotly contested race to chair the House Foreign Affairs Committee.

Meeks, a member of the Congressional Black Caucus, won 29 votes to beat Reps. Brad Sherman (D-Calif.), who won 10 votes, and Joaquin Castro (D-Texas), the chairman of the Congressional Hispanic Caucus who won 13 votes.

Assuming Meeks’s recommendation is ratified by the full Democratic caucus, he would be the first Black person to chair the Foreign Affairs Committee.

THE WAITING GAME: The scuttlebut Monday evening was that a deal on this year’s NDAA, and specifically the requirement to rename Confederate-named military bases, was getting close.

A day later, a deal isn’t clinched. A Democratic House aide tells The Hill that talks on Pentagon-related items have “essentially” finished and that negotiators are working out non-Pentagon issues with the White House.

Several reports have indicated the outstanding issue is the White House’s demand for changes to a legal shield for tech companies known as Section 230. As The Hill previously reported, the White House floated the idea of using the NDAA to repeal the legal shield in exchange for dropping opposition to changing Confederate base names, but talks are now reportedly centering on reforms rather than a repeal.

COVID complications: The sprint to finish the NDAA and other year-end bills is happening amid continued COVID-19 diagnoses for lawmakers.

The Hill’s Cristina Marcos took a look at how lawmakers are trying to finish their work for the year while trying to avoid passing the coronavirus to each other.

Nearly a dozen members of the House and Senate tested positive for COVID-19 in the two weeks before Thanksgiving, underscoring the risks of having hundreds of lawmakers travel back and forth from all over the country and gather together in the Capitol while virus cases are surging nationally. 

House Democrats delayed returning to session until Wednesday and are urging members to stay in Washington over the weekend with an eye on wrapping up their December to-do list next week. Senate Republicans, meanwhile, are temporarily suspending in-person caucus lunches after holding them with social distancing guidelines since May.

OVERSIGHT PANEL SLAMS DOD FOR $700M LOAN: The Pentagon is taking new heat for its use of the last round of COVID-19 relief funding.

The Congressional Oversight Commission overseeing COVID-19 relief funds excoriated the Defense and Treasury departments Tuesday over a $700 million loan to a troubled shipping company.

The Treasury Department and the Defense Department offered the loan in July when the company, YRC Worldwide, was reportedly worth just $70 million and had been sued by the Pentagon for overpriced shipping costs.

The bipartisan commission overseeing funds from the $2.2 trillion CARES Act said both agencies had failed to provide adequate answers on the matter, and in some cases had raised further concerns with their responses to earlier inquiries.

“The Department of Defense has yet to provide the Commission a satisfactory explanation for how YRC is critical to national security,” the committee said in its most recent oversight report, noting that there were three larger shipping providers offering similar services.

“The Department of Defense did not even consider whether the services it obtains from YRC could be obtained elsewhere,” the report continued, raising further concerns about the favorable terms of the loan and the likelihood that the stake Treasury took in the company would be compromised in the event of a default.

“The Commission is concerned that the Treasury may have put taxpayers in a precarious position,” the report said.

Background: The CARES Acts allocated $500 billion to the Federal Reserve and Treasury for emergency loans and grants, including a pool of more than $30 billion set aside for the aircraft sector, airlines and other businesses essential to national defense. 

Treasury and YRC on July 8 finalized a $700 million loan from the national security tranche after the Defense Department certified that YRC is essential to national security. YRC specializes in “less-than-truckload” shipping, where smaller loads from multiple clients are combined in one trailer.

Treasury called YRC a “leading provider of critical military transportation and other hauling services,” in a July 1 press release, including 68 percent of less-than-truckload services for the Defense Department. The company also boasts contracts with the Departments of Energy and Homeland Security.

ON TAP FOR TOMORROW

Navy Secretary Kenneth Braithwaite, Chief of Naval Operations Adm. Michael Gilday and Marine Commandant Gen. David Berger will testify before a Senate Armed Services Committee subpanel about Navy and Marines Corps readiness at 9:15 a.m. https://bit.ly/39Fgfhg

Chairman of the Joint Chiefs of Staff Gen. Mark Milley will speak at a virtual Brookings Institution event at 11 a.m. https://brook.gs/33x7mCG

A House Foreign Affairs Committee subpanel will hold a hearing on the right of women and girls in the Middle East with expert testimony at 2 p.m. https://bit.ly/3ofm1dC

ICYMI

— The Hill: Government announces weapons sales with six nations worth combined $1.55B

— The Hill: Schumer meets with Biden national security picks

— The Hill: ISIS Task Force director resigns from Pentagon post in continued post-election purge

— The Hill: Pentagon reports 12th military COVID-19 death

— The War Horse: Gag Order: How Marine Corps culture silenced a victim of sexual assault

— Associated Press: Iran’s parliament approves bill to stop nuclear inspections