The Defense Department estimates that it has used the law’s powers 300,000 times a year. The Department of Homeland Security — including its subsidiary, FEMA — placed more than 1,000 so-called rated orders in 2018, often for hurricane and other disaster response and recovery efforts, according to a report submitted to Congress in 2019 by a committee of federal agencies formed to plan for the effective use of the law.
The law, which was used frequently by previous administrations as well, does not permit the federal government to assert complete control over a company. The federal government can, however, use it to jump ahead of other clients or issue loans so a company can buy all of the supplies it needs to complete the government’s order by a specific date. A rarely used authority of the law also allows the administration to control the distribution of a company’s products and determine where such materials go.
The Pentagon has long been aggressive in its use of the law, inserting language from the wartime act into contracts to ensure delivery of products by a specific date.
