Congress Moves Forward on Roughly $900 Billion Defense Bill

Lawmakers who serve on both chambers’ Armed Services committees on Wednesday night released compromise text for the annual National Defense Authorization Act. This year’s NDAA, which lays out top policy priorities for the Pentagon, calls for a 5.2% pay raise for service members and military training assistance to Taiwan to help the island defend itself against a possible invasion by China.

The text, called a conference report, came after House and Senate negotiators spent the past week hammering out differences between the NDAA bills their chambers passed earlier this year, a process that prompted House lawmakers to drop several controversial social-policy measures that were unlikely to get approval from President Biden and the Democratic-controlled Senate.

The newly released proposal now has to pass through both chambers and secure Biden’s signature. The Senate could take the first step toward approving it in a procedural vote on Thursday.

Lawmakers agreed to scrap what critics called culture-war provisions from the House version, including one that would have blocked the military’s healthcare program from providing gender-related surgeries and hormone treatments for transgender people.

Another dropped provision from the House-passed bill would have prohibited the Defense Department from covering the costs related to abortion, which would have invalidated a policy that Defense Secretary Lloyd Austin implemented after some states restricted abortion access following a Supreme Court ruling ending the right to the procedure.

That policy, which grants service members time off and travel money to get reproductive healthcare outside the states where they are stationed, infuriated some Republicans, including Sen. Tommy Tuberville (R., Ala.), who blocked hundreds of military promotions for months before backing down this week. Some states with the most restrictive abortion policies are also home to major military installations including in Texas, Louisiana and Kentucky.

The NDAA proposal, which would increase America’s total national security budget by roughly 3% to $886 billion from last year’s $858 billion authorization bill, contains hundreds of smaller policy proposals as lawmakers steer Defense Department officials toward key priorities.

The proposal calls for roughly $170 billion to buy helicopters, combat vehicles, Navy submarines, weapons such as bombs and rockets, and a $1.9 billion, 684-foot-long battleship to transport Marines, anchor overseas security operations and provide humanitarian aid to struggling regions. It also calls for an additional $145 billion for research and technology development.

The proposal would send $300 million for security assistance to help fortify Ukraine’s military after nearly two years of fighting against the Russian invasion. That is separate from the tens of billions of dollars in aid requested by Biden that failed to move forward in a Senate procedural vote Wednesday.

Congress has so far approved more than $100 billion to help Kyiv but some House Republicans have resisted sending more money, pressured by voters in their congressional districts who want lawmakers to give priority to domestic problems over a foreign conflict.

The proposed NDAA report includes several measures aimed at strengthening the U.S. military’s ability to counter China, funding initiatives to keep relationships with allies in the Pacific region close while carrying out military exercises as a show of U.S. strength.

Lawmakers have proposed to fund new technologies to better position the U.S. military to counter potential Chinese aggression, including high-energy lasers, mobile micronuclear reactors and radar sophisticated enough to track high-altitude balloons capable of spying on U.S. communications.

The proposal also requires defense officials to reach out to service members who were dismissed for refusing Covid-19 vaccines, which were once required. Congress removed that requirement in last year’s NDAA after Republicans said it could hurt recruitment.

The bill also extends until mid-April the government’s foreign surveillance powers, which are due to lapse at the end of this year. The decision to essentially table what is expected to be a fierce security and privacy debate over those powers until the spring could lead some lawmakers to vote against the overall defense legislation, which Congress is aiming to pass by the end of the year. More than 50 House lawmakers from both parties recently wrote to congressional leadership saying they opposed any effort to temporarily extend Section 702 of the Foreign Intelligence Surveillance Act by linking it to the must-pass annual defense bill.

Absent from the legislation is a provision regulating American investment in certain Chinese technology sectors. The Senate overwhelmingly approved an amendment over the summer that would have required Americans to disclose their investments in some Chinese industries, and lawmakers had sought to include a similar plan in the NDAA.

But Republican opposition to the proposal in the House stymied those efforts. Some GOP lawmakers had warned that regulating outbound investment would harm American national security.

The Biden administration is already moving forward with an executive order that would restrict U.S. investment into Chinese advanced technology.

Write to Katy Stech Ferek at katy.stech@wsj.com