Commerce Dept. seeks data on industries affected by Katrina.

• Author: Erwin, Sandra I.
• Position: UPFRONT

The Commerce Department has set up an Internet web portal for defense industry to report specific production or supply problems resulting from recent hurricanes. Of particular concern is the damage caused by Hurricane Katrina to liquid hydrogen plants, which could affect defense suppliers in the space and munitions sectors.

In the aftermath of Hurricane Katrina in early September, the Commerce Department's office of strategic industries and economic security (OSIES) was made responsible for identifying defense supply or production issues being experienced by industry, particularly those companies that are located along the Gulf Coast.

OSIES has established a special e-mail address (Katrina.defenseindustry@bis.doc.gov) to receive reports from affected companies. Firms are asked to provide a written description of the specific damages and the impact on production and delivery.

Under the Defense Production Act of 1950, the president can request that certain supplies and services be redirected from commercial to military or government customers in support of national defense and energy programs.

Regulations known as "Defense Priorities and Allocations System" provide guidelines for reassigning industrial resources in national emergencies. DPAS must ensure a rapid industrial response during a national emergency and also attempt to minimize disruptions to normal commercial activities. DPAS ratings are given to 300,000 Defense Department contracts. Those ratings are used to set priorities for delivery of supplies and raw materials in the event of a crisis.

After Katrina hit, a group of officials from the Commerce and Defense Departments, as well as the Department of Homeland Security, concluded that the hurricane potentially would affect production of key materials used in military equipment.

Katrina marked the first time that the Defense Priorities and Allocations System was implemented in a domestic crisis not attributed to a military conflict. "The magnitude of the area affected and the potential impact on defense industry" warranted the decision to enforce DPAS, said William J. Denk, director of the defense programs division at the Commerce Department's office of strategic industries and economic security.

Among the top concerns are liquid hydrogen supplies. Liquid hydrogen is an essential commodity for the steel and petrochemical industries and public utilities, as well as NASA and the Air Force.

The area smashed by Katrina is home to 25...