Defense Department Waivers of Domestic Specialty Metals Preference and Other Requested Information

In response to a congressional request, GAO provided information on Department of Defense (DOD): (1) waivers of domestic procurement restrictions for purchases of specialty metals; (2) procurements that are restricted to domestic and Canadian sources for reasons of national security or industrial mobilization; and (3) projected steel requirements for fiscal year 1983. GAO also reported on the Corps of Engineers' foreign-source awards for steel and steel-related products.

Although original legislation prohibited DOD from purchasing foreign specialty metals, recent changes to the restrictions exempt procurements for the production or manufacture of weapons or weapons systems made outside of the United States, if such procurement is necessary to comply with agreements with foreign governments. Procurement from domestic or Canadian sources is required during a national emergency to enable effective industrial mobilization planning. DOD has identified a need for about 1.1 million short tons of steel for military items in 1983, representing almost 1.5 percent of the domestic steel production for 1982. GAO also noted that the Corps reasonably obtained foreign prime contractors by identifying firms that had received waivers of Buy American Act restrictions.