Agency Tasked by Trump With $100M to Boost Supply Chain Hasn’t Spent a Penny

In 2020, former President Donald Trump tasked a government agency with giving loans to help ease supply chain issues caused by the COVID-19 pandemic — but that agency hasn’t spent a single penny of the $100 million it received, the Government Accountability Office (GAO) recently found.

In a report released on Wednesday, the GAO found that the International Development Finance Corporation (DFC) has received 178 applications for loans since June 2020, when the agency first received the funds. However, with loan reviews taking longer than expected — and with the agency continually extending the expected response time — the only money the DFC has requested for reimbursement so far has been for payroll and internal services, totalling about $1.4 million.

The DFC website says that the money, allocated under an executive order signed by Trump in May of last year, was given “to finance the domestic production of strategic resources needed to respond to the COVID-19 outbreak, and to strengthen any relevant domestic medical supply chains.”

One project that could be eligible for loans is companies manufacturing personal protective equipment (PPE) like masks, gloves and COVID tests.

The program began in the midst of a major PPE shortage that researchers say was largely the result of supply chain issues. The shortages were so dire that some health care workers had to improvise PPE, wearing trash bags and snorkel masks to protect themselves as governments, health officials and the public scrambled for supplies in the early stages of the pandemic.

COVID tests were also scarce. In the beginning of the pandemic, many health care centers only allowed people with symptoms to get tested because of testing shortages. It remains difficult to find at-home COVID tests even now, partially due to a lack of government support.

The money that was allocated to address these challenges was given under the Defense Production Act, an obscure wartime law used to compel companies to manufacture certain equipment. As such, the $100 million allocated to DFC for the COVID loans is part of the Department of Defense’s funds from the 2020 CARES Act.

The DFC was formed in 2019 as the result of a Trump-issued executive order that merged two separate agencies. Under Trump, the DFC was run by Adam Boehler, a college friend of Jared Kushner’s who was previously an adviser in the Department of Health and Human Services, according to NBC.

According to the GAO’s assessment, the DFC has narrowed down the applications to just eight applicants, but still has yet to give out a single loan. Officials say that they failed to account for issues they’ve faced in administering the program, like regulatory processes, hiring new staff and interagency process timelines.

A spokesperson for the DFC has disputed the GAO report, saying that it “inaccurately portrays DFC’s particular role” in the program. While the DFC is responsible for parts of the program, spokesperson Pooja Jhunjhunwala said that the Department of Defense oversees the funding.

NBC reports that the company whose application is closest to acceptance right now is called ApiJect. But according to the GAO, ApiJect’s project to build a new facility to make vaccine-related equipment has run into delays because the company has not yet secured “the necessary property rights for the project site.”

Meanwhile, the portal to apply for loans under the program has been paused — and the agency will lose its ability to give out COVID-related loans at the end of March 2022.