On Friday, Congresswomen Susan W. Brooks (R-Ind.-05) and Anna Eshoo (D-Calif.-18) introduced H.R. 6516, the Stockpile Inventory Modernization (SIM) Act of 2020 to allow the Strategic National Stockpile to better serve Americans.
Brooks
“Under current law, the Strategic National Stockpile (SNS) is forced to throw away countless dollars of personal protective equipment and pharmaceuticals per year as those items expire,” said Brooks. “This critical piece of legislation will give the SNS the authority to sell such products to other federal agencies before they expire, thus saving the American taxpayers money. It will expand the ability of the SNS to keep the supplies on its shelves up-to-date by allowing it to work with other Federal agencies to meet their mutual needs. When another Federal Agency has a need for a product stockpiled on the SNS’ shelves, the agency can engage in an agreement with the SNS to purchase that product. This will have the dual effect of saving American taxpayers’ money, by allowing other agencies to purchase at a discount, while also allowing the SNS to keep the supplies on its shelves.”
“The current COVID-19 emergency has demonstrated that the SNS plays a critical role in our nation’s response to a public health event, but the pandemic has also highlighted the need for long overdue improvements to the way SNS operates,” said Eshoo. “I’m proud to sponsor this important legislation to give the SNS additional flexibility and stretch taxpayer dollars further so that we can respond to the current pandemic and be prepared for the next.”
The Stockpile Inventory Modernization Act of 2020 gives the SNS the ability to make sales to other federal agencies.
This bipartisan legislation was created to allow SNS to sell existing product on its shelves to other agencies so that SNS can recover some fraction of the original purchase price which it can then reinvest in new inventory for the shelves. The federal agencies purchasing the products will also benefit from this. They will be receiving a discount on product they would have otherwise had to purchase at full price from a manufacturer.
Currently, the SNS buys a product directly from manufacturers then keeps it on the shelf until expiry. Upon expiry, the product is destroyed and the SNS has to use new appropriations to restock.
This legislation will have the dual benefit of saving American taxpayers money while simultaneously improving the ability of the stockpile to keep its inventory up-to-date.
This legislation does not obligate the SNS or any agency to engage in such sale. It simply gives them the option if both parties believe such a sale is in their mutual best interest.
Sales of this type already happen regularly within the federal government. The General Services Administration (GSA) regularly purchases large qualities of supplies and sells it to other agencies. The GSA can take advantage of economies of scale then sell to other agencies as their needs arise. Aside from benefiting from economies of scale, it allows each agency to stockpile less of its own product because it knows the government already has some of the product sitting on the shelves for them to purchase as their needs arise.