# Defense: FY2012 Budget Request, Authorization and Appropriations

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/crs%3AR41861

## Record

- **Collection:** Congressional research report
- **Document type:** CRS Report
- **Published:** February 13, 2012
- **Citation:** R41861

## Text

Defense: FY2012 Budget Request,
Authorization and Appropriations
(name redacted)
Specialist in U.S. Defense Policy and Budget
February 13, 2012

Congressional Research Service
7-....
www.crs.gov
R41861

CRS Report for Congress
Prepared for Members and Committees of Congress

Defense: FY2012 Budget Request, Authorization and Appropriations

Summary
President Obama’s FY2012 budget request, sent to Congress on February 14, 2011, included
$670.9 billion in discretionary budget authority for the Department of Defense (DOD), of which
$553.1 billion was for the so-called “base budget” of the department (that is, the cost of routine,
peacetime operations excluding the cost of ongoing operations in Iraq and Afghanistan). The
remaining $117.8 billion in the DOD budget request was to cover the cost of so-called “overseas
contingency operations (OCO),” including operations in those two countries.
However, the Budget Control Act (BCA) enacted in early August 2011 set ceilings on FY2012
discretionary budget authority that required a reduction of $35.7 billion from the total requested
for so-called “security agencies”—a category that includes the DOD base budget, the
Departments of Veterans Affairs, Homeland Security, and State as well as the Energy
Department’s Nuclear National Security Agency and the international activities of other agencies.
Before the BCA was enacted, the House had passed its version of the FY2012 National Defense
Authorization Act (H.R. 1540), which would have authorized $1.8 billion more than was
requested for DOD in February. The bill was passed on May 26, 2011, by a vote of 322-96. Also
prior to the enactment of the BCA, the Senate Armed Services Committee reported on June 22,
2011, an initial version of the authorization act (S. 1253) which would have authorized $6.4
billion less that the Administration requested for FY2012.
To take account of the BCA-mandated reduction, the Senate Armed Services Committee
approved on November 15, 2011, a second version of the FY2012 authorization bill (S. 1867) that
would have reduced the FY2012 national defense authorization by a total of $27.3 billion. After
debating that bill, the Senate passed the text of it on December 1, 2011, as an amended version of
the House-passed H.R. 1540. The conference report on the FY2012 authorization bill, which cut
the President’s request by $26.6 billion, was adopted by the House on December 14 and then by
Senate on December 15. The President signed H.R. 1540 on December 31, 2011 (P.L. 112-81).
The version of the FY2012 Defense appropriations act (H.R. 2219) passed by the House on June
14, 2011, would have reduced the President’s requested base budget by $8.9 billion. However,
the bill would have provided $842 million more than the President’s $117.8 billion OCO request,
resulting in an overall net reduction of $8.1 bill to the President’s request.
The first legislative action during the year that applied the BCA-mandated spending reduction to
the FY2012 defense budget was taken by the Senate Appropriations Committee on September 7,
2011, when it adopted discretionary spending ceilings for each of its 12 subcommittees that
required the defense subcommittee to cut $25.9 billion from the President’s request for programs
funded by the defense appropriations bill. On September 15, the Senate Appropriations
Committee reported a version of the House-passed defense appropriations bill (H.R. 2219) that
would have cut $29.3 billion from the Administration request.
The Senate never acted on H.R. 2219, but a House-Senate compromise on DOD funding, which
largely tracked the Senate committee-reported bill, was enacted as Division A of the Consolidated
Appropriations Act for FY2012 (H.R. 2055). The House agreed to the conference report on
December 16 by a vote of 296-121. The Senate approved it December 17 by a vote of 67-32. The
bill was signed by the President on December 23, 2011 (P.L. 112-74).

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Defense: FY2012 Budget Request, Authorization and Appropriations

Contents
Most Recent Developments ............................................................................................................. 1
Authorization Bill (H.R. 1540, S. 1253, S. 1867) ............................................................... 1
Defense Appropriations Bill (H.R. 2219, H.R. 2055) ......................................................... 3
Status of Legislation ........................................................................................................................ 5
FY2012 DOD Budget Request ........................................................................................................ 5
Base Budget Highlights............................................................................................................. 7
War Cost Highlights .................................................................................................................. 8
Budgetary Impact and Deficits ...................................................................................................... 10
Changing the Baseline....................................................................................................... 13
FY2012 National Defense Authorization Act (H.R. 1540; S. 1253; S. 1867)............................... 14
Authorization Bill Overview ................................................................................................... 16
House-passed Bill (H.R. 1540) ......................................................................................... 16
Senate Committee-reported Bills (S. 1253, S. 1867) ........................................................ 17
Conference Report (H.R. 1540) ........................................................................................ 19
Earmarks and Add-ons ............................................................................................................ 20
House Add-ons.................................................................................................................. 20
Senate Add-ons ................................................................................................................. 22
Military Personnel Issues ........................................................................................................ 22
Pay Raise........................................................................................................................... 23
End Strength and ‘Dwell Time’......................................................................................... 23
National Guard, the JCS, and Other Reserve Component Issues...................................... 24
TRICARE Fees ................................................................................................................. 26
Don’t Ask, Don’t Tell ....................................................................................................... 27
Women in Combat ............................................................................................................ 28
Acquisition Policy ................................................................................................................... 28
Competition-Promoting Provisions................................................................................... 28
Other Acquisition-related Provisions ................................................................................ 30
Ground Combat Systems......................................................................................................... 33
M-1 Tanks and Bradley Troop Carriers ............................................................................ 33
Ground Combat Vehicle (GCV) ....................................................................................... 33
Expeditionary Fighting Vehicle (EFV) ............................................................................. 34
Shipbuilding ............................................................................................................................ 35
High-Speed Cargo Ships ................................................................................................... 36
Aegis Anti-Missile Ship Requirements ............................................................................. 37
Carrier-based Unmanned Aerial Vehicles (UAVs) ............................................................ 37
Navy Ship Names.............................................................................................................. 37
Aircraft .................................................................................................................................... 38
Mid-Air Refueling Tanker ................................................................................................ 38
F-35 Joint Strike Fighter ................................................................................................... 38
Light Armed Reconnaissance Aircraft .............................................................................. 40
Next Generation Bomber and Prompt Global Strike......................................................... 40
Airlift................................................................................................................................. 41
B-1 and U-2 Retirements................................................................................................... 42
Strategic Missile Subs, Arms Control, and Missile Defense................................................... 42
Nuclear Arms Reductions (START Treaty)...................................................................... 43
Anti-Ballistic Missile Defenses......................................................................................... 44

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Defense: FY2012 Budget Request, Authorization and Appropriations

Military Construction Issues.................................................................................................... 46
Global Deployments.......................................................................................................... 46
Asia-Pacific Region........................................................................................................... 46
Florida Carrier Homeport.................................................................................................. 48
Base Realignment and Closure (BRAC) ........................................................................... 49
Other Committee Report Language .................................................................................. 51
Issues Related to Operations in Afghanistan and Iraq............................................................. 52
Benchmarks and Timetable for Afghanistan..................................................................... 52
Detainee Provisions........................................................................................................... 52
Sanctions on Iran............................................................................................................... 53
Freedom of Information Act (FOIA) Amendments ................................................................. 54
House Floor Amendments (H.R. 1540)................................................................................... 57
Senate Floor Amendments (S. 1867)....................................................................................... 59
FY2012 Defense Appropriations Act (H.R. 2219; H.R. 2250, Division A).................................. 61
Defense Appropriations Bill Overview ................................................................................... 61
House-Passed Bill ............................................................................................................. 61
Senate Committee-Reported Bill....................................................................................... 63
Conference Report Overview............................................................................................ 64
Defense Health Program ................................................................................................... 65
Ground Combat Systems................................................................................................... 65
Aviation Programs............................................................................................................. 66
Ships.................................................................................................................................. 67
House Appropriations Floor Debate........................................................................................ 68

Figures
Figure 1. DOD Discretionary Budget Authority, FY2007-FY2012 ................................................ 6
Figure 2. Funding by Country FY2008-FY2012 ............................................................................. 8
Figure 3. Troop Level by Country FY2008-FY2012....................................................................... 8
Figure 4. OCO Funding Requests by Function, FY2011-12 ........................................................... 9
Figure 5. Projected Future Defense Budgets, FY2012-16............................................................. 10
Figure 6. Alternative National Defense Budget Trends, FY2010-FY2023 ................................... 12

Tables
Table 1. Total FY2012 DOD Discretionary Appropriations (H.R. 2055) ....................................... 4
Table 2. FY2012 National Defense Authorization Act: H.R. 1540, S. 1253, S. 1867..................... 5
Table 3. FY2012 Defense Appropriations Act: H.R. 2219, H.R. 2055 ........................................... 5
Table 4. FY2012 National Defense Authorization Act Summary (H.R. 1540, S. 1253, and
S. 1867)....................................................................................................................................... 15
Table 5. Selected House Floor Amendments to FY2012 National Defense Authorization
Act (H.R. 1540) .......................................................................................................................... 57
Table 6. Selected Senate Floor Amendments to FY2012 National Defense Authorization
Act (S. 1867)............................................................................................................................... 59

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Table 7. Selected House Floor Amendments to FY2012 Defense Appropriations Act
(H.R. 2219) ................................................................................................................................. 68
Table A-1. Congressional Action on Selected FY2012 Missile Defense Funding:
Authorization .............................................................................................................................. 71
Table A-2. Congressional Action on Selected FY2012 Missile Defense Funding:
Appropriations ............................................................................................................................ 75
Table A-3. Congressional Action on Selected FY2012 Ground Combat Programs:
Authorization .............................................................................................................................. 78
Table A-4. Congressional Action on Selected FY2012 Ground Combat and
Communications Programs: Appropriations .............................................................................. 79
Table A-5. Congressional Action on Selected FY2012 Shipbuilding Programs:
Authorization .............................................................................................................................. 81
Table A-6. Congressional Action on Selected FY2012 Shipbuilding Programs:
Appropriation.............................................................................................................................. 83
Table A-7. Congressional Action on Selected FY2012 Navy, Marine Corps and Air Force
Aircraft Programs: Authorization ............................................................................................... 85
Table A-8. Congressional Action on Selected FY2012 Navy, Marine Corps and Air Force
Aircraft Programs: Appropriation............................................................................................... 88

Appendixes
Appendix. Selected Program Funding Tables ............................................................................... 71

Contacts
Author Contact Information........................................................................................................... 91
Key Policy Staff............................................................................................................................. 91

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Most Recent Developments
On December 23, 2011, President Obama signed H.R. 2055, the Consolidated Appropriations Act
for 2012 (P.L. 112-74), providing for the Department of Defense (DOD) $646.3 billion in new
discretionary budget authority, which is $25.3 billion less than the Administration requested. Of
that overall reduction, $22.5 billion is taken from DOD’s so-called “base budget,” which pays for
all DOD operations other than military operations in Iraq and Afghanistan and associated
activities. (See Table 1.)
This 3.8% reduction imposed on the base budget request is intended to meet the caps on nonemergency discretionary spending in FY2012 set by the Budget Control Act (BCA), which was
enacted on August 2, 2011 (P.L. 112-25). The BCA required an overall reduction of $35.7 billion
from the total amount the Administration had requested for FY2012 to fund the government’s socalled “security agencies.” That category was defined to include the DOD base budget (i.e., nonwar costs), the Departments of Veterans Affairs and Homeland Security, and the Energy
Department’s National Nuclear Security Agency, as well as the Department of State and various
international activities funded by other federal agencies.
The BCA did not specify how much of the required reduction in the security agencies’ budget
requests should come from DOD. The first formal legislative action taken to comply with the
BCA was the Senate Appropriations Committee’s adoption, on September 7, 2011, of
discretionary spending ceilings for each of its 12 subcommittees. This action required the panels
to cut $25.9 billion from the President’s request for programs funded by the defense
appropriations bill and an additional $1.3 billion from the request for the bill that funds military
construction programs as well as the Department of Veterans Affairs and other agencies.
Although Congress had begun action on the FY2012 defense authorization and appropriations
bills before the Senate Appropriations Committee acted, Congress treated that committee’s
response to the BCA requirement as the de facto FY2012 spending ceiling on DOD funding.

Authorization Bill (H.R. 1540, S. 1253, S. 1867)
The Administration requested a total authorization of $689.0 billion for programs covered by the
annual national defense authorization act, which includes DOD military activities plus defenserelated nuclear activities conducted by the Energy Department. A version of the FY2012
authorization passed by the House on May 26, 2011 (H.R. 1540) would have added $1.1 billion to
the Administration’s request for the authorization bill. On June 22, the Senate Armed Services
Committee reported its version of the bill (S. 1253), which would have cut the request by $6.4
billion.
Following enactment of the BCA, the Senate Armed Services Committee reported on November
15 a new defense authorization bill (S. 1867) cutting $25.4 billion from the Administration’s
request, thus coming roughly into line with the reductions made by the Senate Appropriations
Committee. The Senate debated and amended S. 1867 over the span of several days before
substituting its text for the text of the House-passed bill and then passing the amended H.R. 1540
on December 1 by a vote of 93-7.
The conference report on H.R. 1540 (H.Rept. 112-329) authorized FY2012 appropriations for
DOD totaling $645.4 billion, $25.4 billion less than the President’s request. Of that total, $530.0
million is for DOD’s “base budget,” which includes all DOD spending except the cost of

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operations in Afghanistan and Iraq (and certain supporting activities elsewhere)—$23.1 billion
less than the President’s request. The bill also authorized $115.5 billion for “overseas
contingency operations (OCO),” that is, war costs, and $16.9 billion for defense-related nuclear
activities conducted mostly by the Energy Department (see Table 4).
The House approved the conference report on December 14, 2011, and the Senate did the same
on the following day. The President signed the bill on December 23, 2011 (P.L. 112-74).
A Note on the Budget Control Act of 2012
The FY2012 appropriations bills are the first that are affected by the Budget Control Act of 2011 (P.L. 112-25), which
established discretionary security and non-security spending caps for FY2012 and FY2013, and overall caps that will
govern the actions of appropriations committees in both houses. For FY2012, the BCA sets a separate cap of $684
billion for security spending, defined to include the Departments of Defense and Veterans Affairs, Budget Function
150 for all international affairs programs, the National Nuclear Security Administration, and the Intelligence
Community Management Account that funds the offices of the Director of National Intelligence. All other spending is
capped at $359 billion out of the total of $1.043 trillion. In addition, the BCA allows for adjustments that would raise
the statutory caps to cover funding for overseas contingency operations/Global War on Terror, emergency spending,
and, to a limited extent, disaster relief and appropriations for continuing disability reviews and for controlling health
care fraud and abuse.1
In FY2013, these initial discretionary caps would be superseded by new caps specified in Section 302 of the Budget
Control Act that would set budget totals for National Defense, or budget function 050, and all other funding. If
Congress does not enact funding that matches these caps, the Administration would implement a sequestration, or
cancellation of budget authority, to meet the levels specified in the act on January 2, 2013.
This report does not reflect the scorekeeping adjustments that may bring the total budget authority provided in the
appropriations proposals in line with the BCA caps and the 302(a) and 302(b) allocations.

Detainee Issues
One set of issues on which the defense authorization conferees had to reconcile the positions of
the Senate, the House, and the Administration comprised various provisions in the House and
Senate versions of the bill relating to detainees held in military custody, including those held at
the U.S. Navy base at Guantanamo Bay, Cuba. The Senate Armed Services Committee’s initial
version of the FY2012 defense authorization bill (S. 1253), reported on June 22, like the
authorization bill passed by the House on May 26, 2011 (H.R. 1540), included several provisions
regulating the treatment of detainees. After the White House and the chairs of other Senate
committees objected to some of the provisions in the Senate committee’s bill, Senate Majority
Leader Harry Reid (NV) delayed Senate floor debate on S. 1253 pending a resolution of the
disputed language.
The Senate Armed Services Committee’s second version of the defense bill (S. 1867) included
revised provisions relating to detainees that addressed some of the objections that had been raised
to the committee’s earlier version. However, the Administration opposed the revised detainee
provisions in the official Statement of Administration Position (SAP) on the bill, issued
November 17, 2011, by the Office of Management and Budget.2 Using the standard language to
issue a veto threat, the SAP said that the President’s senior advisors would recommend a veto of,
1

For more information on the Budget Control Act of 2011, see CRS Report R41965, The Budget Control Act of 2011,
by (name redacted), (name redacted), and (name redacted).
2
See Office of Management and Budget, Statement of Administration Policy on S. 1867, November 17, 2011, at
http://www.whitehouse.gov/sites/default/files/omb/legislative/sap/112/saps1867s_20111117.pdf.

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“any bill that challenges or constrains the President’s critical authorities to collect intelligence,
incapacitate dangerous terrorists, and protect the Nation.”
The conference report for H.R. 1540 largely adopts the Senate version of the detainee provisions.
The bill reaffirms the authority of the Armed Forces to detain certain individuals in connection
with hostilities authorized in response to the 2001 terrorist attacks, leaving unclear the extent to
which such authority may be exercised with respect to U.S. citizens. The final bill also prohibits
the use of DOD funds to bring Guantanamo detainees to the United States and places stringent
conditions on the use of such funds to transfer or release any Guantanamo detainee to a foreign
country.
Detainee-Related Provisions in the Defense Authorization Bill
For a summary of detainee-related provisions in the House and Senate versions of the defense bill and of related
amendments considered by each chamber, see below “Detainee Provisions” (pp. 58-59). For more detailed analysis of
the provisions of H.R. 1540 and S. 1867 relating to detainees, see CRS Report R41920, Detainee Provisions in the
National Defense Authorization Bills, by (name redacted) and (name redacted).

Defense Appropriations Bill (H.R. 2219, H.R. 2055)
On June 14, 2012, the House passed a FY2012 defense appropriations act (H.R. 2219), that would
have reduced the President’s requested base budget by $8.9 billion. However, the bill would have
provided $842 million more than the President’s $117.8 billion OCO request, resulting in an
overall net reduction of $8.1 billion to the President’s request.
The first legislative action during the year that applied the BCA-mandated spending reduction to
FY2012 defense budget was taken by the Senate Appropriations Committee on September 7,
2011, when it adopted discretionary spending ceilings for each of its 12 subcommittees that
required the defense subcommittee to cut $25.9 billion from the President’s request for programs
funded by the defense appropriations bill. On September 15, the Senate Appropriations
Committee reported a version H.R. 2219 that would have cut $29.3 billion from the
Administration request.
The Senate never acted on that bill, but a House-Senate compromise on DOD funding, which
largely tracked the Senate committee-reported bill, was enacted as Division A of the Consolidated
Appropriations Act for FY2012 (H.R. 2055). The House agreed to the conference report on
December 16 by a vote of 296-121. The Senate approved it December 17 by a vote of 67-32. The
bill was signed by the President on December 23, 2011 (P.L. 112-74).

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Table 1. Total FY2012 DOD Discretionary Appropriations (H.R. 2055)
(amounts in billions of dollars)
FY2012
Enacted vs.
Request

FY2012
Enacted vs.
FY2011

FY2011
Enacted

FY2012
Request

FY2012
Enacted

Military Personnel

126.74

132.10

131.09

-1.01

4.35

Operation and Maintenance

165.56

170.76

163.07

-7.69

-2.49

Procurement

102.12

114.37

104.58

-9.79

2.46

Research, Development Test
and Evaluation

74.96

75.33

72.42

-2.90

-2.54

Revolving and Management
Funds

2.91

2.70

2.68

-0.03

-0.23

DOD Health Care and Other
DOD Programs

34.31

35.52

35.59

0.07

1.28

Related Agencies

0.94

1.11

1.06

-0.04

0.12

General Provisions (net)

-5.12

0.03

-2.60

-2.63

2.52

Scorekeeping adjustmentsa

11.03

10.88

10.88

0.00

-0.15

Less appropriations requested
for subsequent yearsb

0.00

-3.21

0.00

3.21

0.00

Less Mandatory Spending

-0.29

-0.51

-0.51

0.00

-0.22

Total FY2012 DOD Base
Budget (Discretionary)

513.17

539.06

518.26

-20.79

5.10

Title IX - Overseas
Contingency Operations
(OCO)

157.68

117.73

114.97

-2.76

-42.71

Total DOD Discretionary in
Defense appropriations Bill

670.85

656.78

633.23c

-23.55

-37.62

Base Budget, MilCon

16.59

14.77

13.05

-1.72

-3.54

OCO Budget, MilCon

1.22

0.00

0.00

0.00

-1.22

Total DOD Discretionary in
Military Construction
Appropriations Bill

17.81

14.77

13.05d

-1.72

-4.76

Grand Total, FY2012
Discretionary Appropriations

688.66

671.55

646.28

-25.27

-42.38

Source: H.Rept. 112-94, Conference report on H.R. 2219, Consolidated Appropriations for FY2012
a.

Scorekeeping adjustments reflect chiefly permanent appropriations such as the TRICARE for Life accrual
payment to the military retirement fund.

b.

The Administration’s FY2012 budget request included $3.2 billion in budget authority for communication
satellites that would be spent in FY2013-27. Neither the Armed Services nor Appropriations Committees
of the Senate or House accepted this proposal.

c.

H.R. 2055, Consolidated Appropriations Bill, FY2012, Division A.

d.

H.R. 2055, Consolidated Appropriations Bill, FY2012, Division H.

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Status of Legislation
Table 2. FY2012 National Defense Authorization Act: H.R. 1540, S. 1253, S. 1867
Conference Report
Approval

Senate Reports
House
Report

House
Passage

S. 1253

S. 1867

H.Rept.
112-78
5/17/2011

Agreed to
322-96
5/26/2011

S.Rept.
112-26
6/22/2011

Committee
approved
11/15/11
(no report)

Senate
Passage

Conf.
Report

Agreed to
(as amdt.
to H.R.
1540)

H.Rept.
112-329
12/12/2011

House

Senate

Public
Law

Adopted
Adopted P.L. 112-81
12/14/2011 12/15/2012 12/31/2011
283-136
86-13

93-7
12/1/2011

Table 3. FY2012 Defense Appropriations Act: H.R. 2219, H.R. 2055
Conference Report
Approval
(H.R. 2055, Div. A)
House
Report

House
Passage

Senate
Report

Senate
Passage

Conf.
Report

H.Rept.
112-110
6/16/2011

Agreed to
336-87
7/8/2011

S.Rept.
112-77
9/15/2011

no
action

H.Rept.
112-331

House

Senate

Public
Law

12/16/2011 12/17/2011 P.L. 112-74
296-121
67-32
12/23/2011

12/15/2011

FY2012 DOD Budget Request
President Obama’s FY2012 budget request for the Department of Defense (DOD), which totaled
$670.9 billion, was nearly 5.3% less than the amount he had requested for DOD in FY2011 and
nearly 2.5% lower than the amount Congress approved for that year, after cutting more than $20
billion from the FY2011 DOD request. The bulk of the reduction in the FY2012 request reflected
the Administration’s plan to reduce DOD funding for combat operations in Iraq and Afghanistan
by 26% as the tempo of U.S. military activity in Iraq continues to decline and the planned
drawdown of U.S. troops in Afghanistan gets underway. The Administration’s FY2012 request
assumes that all U.S. troops will be out of Iraq by the end of the first quarter of FY2012 and that
the average number in Afghanistan will decline from 102,000 during FY2011 to 98,000, as the
Administration begins its planned drawdown in U.S. troop levels.
The FY2012 request, sent to Congress on February 7, 2011, included $553.7 billion for DOD’s
base budget, which includes all routine activities other than ongoing war costs. Compared with
the FY2011 DOD base budget set by the FY2011 Department of Defense and Full-Year
Continuing Appropriations Act (H.R. 1473, P.L. 112-10), this amounts to a 3% real increase in
purchasing power, taking account of inflation.
On the other hand, the FY2012 request for so-called Overseas Contingency Operations (OCO,
i.e., operations in Iraq and Afghanistan), which is $117.8 billion, would have amounted to an
inflation-adjusted decrease of 27%.

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Figure 1. DOD Discretionary Budget Authority, FY2007-FY2012
(amounts in billions of dollars)
800
700
600
500
400
300
200
100
0
2007

2008

2009

2010

2011

2012
request

Afghanistan

34

39

52

100

113

107

other supp.

3

7

1

Iraq

132

145

94

62

68

11

Base Budget

432

480

513

528

526

553

Source: DOD FY2012 Budget Briefing.

Of the FY2012 base budget request, $528.7 billion is for programs funded by the annual Defense
appropriations bill; $14.8 billion is for military construction and family housing programs funded
by the annual appropriations bill for those activities, the Department of Veterans Affairs and
other agencies. The remaining $10.7 billion requested in the FY2012 base budget funds the socalled Tricare-for-Life program, which provides medical benefits to Medicare-eligible military
retirees. Funding for Tricare-for-Life is a permanent appropriation made automatically under a
provision of standing law.3
The FY2012 budget request would have reduced military construction funding for the third year
in a row, largely for three reasons:
•

The budget to build facilities for units that are moving to new sites as a result of
the FY2005 Base Realignment and Closure (BRAC) process is down sharply
because most BRAC-related construction was funded in earlier budgets, in order
to meet a September 15, 2011, deadline for completing the moves;

3

House and Senate Appropriations Committee tables generally show the amount for Tricare-for-Life as a
“scorekeeping adjustment.” DOD tables generally show the amount as part of the annual request for military personnel.

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•

The budget for construction projects in Iraq and Afghanistan, which was $1.3
billion in FY2011, is $80 million in FY2012; and

•

The request for family housing-related accounts continues to decline as a result
of a policy, begun in the late 1990s, of privatizing military housing.

Military Construction Funding
For analysis of the FY2012 military construction budget request and funding legislation, see CRS Report R41653,
Military Construction: Analysis of the President’s FY2012 Appropriations Request, by (name redacted).

Base Budget Highlights
Compared with the Obama Administration’s prior DOD budget requests, the FY2012 proposal
incorporates fewer cuts to major weapons programs. However, the Administration’s proposal
canceled the Marine Corps’s effort to develop the Expeditionary Fighting Vehicle (EFV) as a
replacement for its current fleet of amphibious troop carriers. It also restructured the F-35 Joint
Strike Fighter program, slowing a projected increase in production, increasing the plane’s
development budget, and putting on probation for two years the effort to develop a vertical
takeoff version of that plane for use by the Marines.
To replace some aging Navy fighters that had been slated for replacement by now-delayed F-35s,
the budget proposed to continue longer than had been planned—through FY2014—the purchase
of F/A-18E/F carrier-based jets. It also funded efforts to develop a new generation of long-range
bombers and missile-launching submarines and mid-air refueling tankers.
The budget continued the Administration’s avowed emphasis on acquiring equipment that would
enhance the ability of U.S. forces to conduct the types of operations which the Administration
deems most likely in the near term: relatively limited, if prolonged and complex operations such
as the current campaigns in Iraq and Afghanistan, rather than large-scale, conventional wars with
a potential peer competitor, such as China or a militarily resurgent Russia. For example, the
budget requests more than $10 billion to develop and acquire various types of helicopters and
$4.8 billion for an array of unmanned aerial systems (UASs) that range in size and price from the
airliner-sized Global Hawk to hand-launched reconnaissance drones the size of a toy.
The FY2012 budget request also incorporates some early results of the Administration’s pledge to
achieve a total of $178 billion in efficiency savings in the DOD budgets for FY2012-FY2016.
To reach that $178 billion goal, the armed services and the Special Operations Command are to
identify a total of $100 billion in savings over the five-year period of which $28 billion is to be
used to cover higher-than-anticipated operating costs while the remaining $72 billion is to be
reinvested over the five year period in high priority weapons programs, such as development of
the Air Force’s new long-range bomber, procurement of additional F/A-18E/F fighters and the
addition of six ships to the Navy’s acquisition plan.
Over the same five-year period (FY2012-FY2016), DOD officials are committed to reduce the
cumulative DOD budget request by a total of $78 billion through such factors as DOD’s share of
the two-year, government-wide freeze on federal civilian pay ($12 billion), a freeze on the size of

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the DOD civilian workforce ($13 billion), and a reduction in service support contracts ($6
billion).
The FY2012 budget reflects an initial installment of $10.7 billion toward a projected total savings
by the services and Special Operations Command of $100.2 billion through FY2016. Of the
FY2012 total, $3.3 billion comes from reducing or terminating acquisition programs, $3.5 billion
is attributed to organizational streamlining, and $3.9 billion is to come from more efficient
business practices.

War Cost Highlights
The Administration’s FY2012 budget request for war costs reflects its plan to wrap up by the end
of calendar year 2011 the U.S. combat role in Iraq and to begin drawing down the U.S. military
effort in Afghanistan (see Figure 2 and Figure 3).
Under an agreement with the government of Iraq, U.S. military forces are slated to withdraw by
December 31, 2011, by which time Iraqi forces will be responsible for providing internal security.
In contrast with the FY2011 DOD budget, in which Congress appropriated $1.5 billion of the
$2.0 billion requested for funds to train and equip Iraqi forces, the FY2012 DOD budget requests
no funds for those purposes.
Figure 3. Troop Level by Country
FY2008-FY2012

Figure 2. Funding by Country
FY2008-FY2012

200

200
150

150

100

100

50

50

0
2010

2011

0

2012
Request

2008

2009

Iraq

148

94

62

46

11

Afghanistan

39

52

100

113

107

Millions of dollars

Source: DOD Comptroller, FY2012 DOD Budget
Request Overview, p, 6-4.

2011

2012
Request

2008

2009

2010

Iraq

154

141

96

43

5

Afghanistan

33

44

84

102

98

Number of troops in thousands

Source: DOD Comptroller, FY2012 DOD Budget
Request Overview, p, 6-4.

In December 2009, President Obama announced decisions to (1) “surge” the number of U.S.
military and civilian personnel in Afghanistan, with the aim of disrupting and defeating al-Qaeda
and (2) begin a “conditions-based” withdrawal of U.S. troops from the country in July 2011. In
December 2010, announcing the results of the Administration’s Afghanistan-Pakistan Annual
Review, President Obama said the United States was committed to handing over to the Afghan

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government lead responsibility that country’s security by 2012.4 Consistent with that policy, the
DOD budget for funds to train and equip Afghan Security forces, for which Congress approved
(as requested) $11.6 billion in FY2011, increased to $12.8 billion in FY2012 under the
Administration’s budget.
Figure 4. OCO Funding Requests by Function, FY2011-12
(amounts in billions of dollars)

180
160
140
120
100
80
60
40
20
0
Operations

Protection

Intelligence

Local
Support

Other

Equipment
Reset

FY2012

66.6

10.1

11.5

13.9

1.9

11.9

FY2011

89.4

15.3

12.6

16.9

3.8

21.4

Source: DOD Comptroller, FY2012 DOD Budget Request Overview, p, 6-5.
Notes: “Local Support” includes funding to support Iraqi and Afghan security forces and other countries
assisting the U.S. effort as well as the Commanders’ Emergency Response Program (CERP).”Intelligence” includes
military intelligence and support from national intelligence agencies.

War Funding
This report summarizes highlights of the budget request and legislative actions relating to operations in Iraq and
Afghanistan, For a comprehensive analysis of issues related to the funding of U.S. military operations in Iraq and
Afghanistan see CRS Report RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since
9/11, by (name redacted).

4

For background and analysis, see CRS Report R40156, War in Afghanistan: Strategy, Operations, and Issues for
Congress, by (name redacted).

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Budgetary Impact and Deficits
Congress weighed the FY2012 DOD budget request in the context of intense pressure across a
wide band of the political spectrum to reduce the federal budget deficit.
In January 2011, a few weeks before DOD published its FY2012 request, the Defense
Department announced $78 billion of savings in the FY2012-FY2016 five-year defense plan that
was submitted with the FY2012 budget request, compared with the spending plan for the same
period that accompanied the FY2011 DOD budget request (see Figure 5).
Figure 5. Projected Future Defense Budgets, FY2012-16
(amounts in billions of dollars)
660
640
620
600
580
560
540
520
500

2012

2013

2014

2015

2016

FY2011 Budget Request

566

582

598

616

635

FY2012 Budget Request

553

571

586

598

611

Source: DOD Comptroller, FY2012 DOD Budget Request Overview, p, 1-2.

But even before the President released his FY2012 proposal, there had been calls for more
substantial retrenchment in DOD spending. In December 2010, former Senator Alan Simpson and
former White House staff director Erskine Bowles, the co-chairs of the presidentially appointed
National Commission on Fiscal Responsibility and Reform (generally referred to as the “Fiscal
Commission”), recommended cuts in security-related spending that, if applied proportionally to
defense, would have entailed a reduction of as much as $100 billion a year in national defense
funding by the middle of the decade compared to Administration projections at the time of the
commission report.5 The Fiscal Commission plan also contemplated substantial additional cuts in
5
The Moment of Truth: Report of the National Commission on Fiscal Responsibility and Reform, December 2010, at
http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/TheMomentofTruth12_1_2010.pdf. It is
important to note that the Fiscal Commission did not reach a consensus. Eleven of the eighteen members of the
Commission endorsed the plan by Co-Chairs Alan Simpson and Erskine Bowles, but the proposal did not receive the
(continued...)

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later years. In November 2010, the independent, bipartisan Domenici-Rivlin Debt Reduction Task
Force recommended a comparable cut in defense by the middle of the decade, though it would
have allowed growth in spending to resume thereafter.6
On April 13, 2011, the President outlined a long-term budget proposal that would reduce funding
for security-related programs, of which defense is the largest part,7 by an additional $400 billion
(beyond the reductions embodied in the FY2012 DOD request) over the 12 years from FY2012FY2023.8 The Defense Department is now working on adjusting its long-term plans to absorb an
as-yet-undetermined share of the cuts (see Figure 6).

(...continued)
14 votes needed for formal approval.
6
Restoring America’s Future, Debt Reduction Task Force, Bipartisan Policy Center, November 2010.
7
The Administration defines security-related discretionary spending to include Department of Defense military
activities, Department of Energy nuclear weapons development and production, Department of Veterans’ Affairs health
programs, international affairs, and Department of Homeland Security spending. See Office of Management and
Budget, Fiscal Year 2012 Budget of the U.S. Government, Table S-11, “Funding Levels for Appropriated
(“Discretionary”) Funds by Agency,” pp. 199-200, on line at http://www.whitehouse.gov/sites/default/files/omb/
budget/fy2012/assets/budget.pdf.
8
The White House, Office of the Press Secretary, “Remarks by the President on Fiscal Policy,” George Washington
University, April 13, 2011, on line at http://www.whitehouse.gov/the-press-office/2011/04/13/remarks-president-fiscalpolicy.

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Figure 6. Alternative National Defense Budget Trends, FY2010-FY2023
(billions of dollars)
800

Billions of dollars

700

600

500

400

300
FY2010

FY2012

FY2014

FY2016

FY2018

FY2020

FY2022

Fiscal Year
CBO Baseline

Feb 2010 Request

Feb 2011 Request

April 2011 Estimate

Fiscal Commission

Domenici-Rivlin

Sources: CBO baseline from Congressional Budget Office; February 2010 and 2011 requests from Office of
Management and Budget; estimates of Fiscal Commission, Domenici-Rivlin, and April 2011 Administration plans
by Congressional Research Service.
Note: Amounts are for discretionary budget authority for the national defense budget function, excluding
funding for overseas contingency operations.

Some defense advocates have opposed the President’s plan for additional reductions in projected
DOD budgets, including the House Armed Services Committee chairman, Representative
Howard P. “Buck” McKeon, who called the proposal to take $400 billion from security-related
budgets “jawdropping…. There appears to have been no consideration of threats, of deterrence, of
logistics, or capabilities—or even the effect such cuts would have on our three wars, our troops,
or our national security,” he said in an op-ed column published in USA Today.9
However, in April 2011 the House incorporated the Administration’s February 2011 defense
projections, extended through FY2021, in its FY2012 budget resolution. The House
Appropriations Committee went further, setting a funding target for the Defense Subcommittee
requiring Congress to cut $8.9 billion from the President’s FY2012 request for DOD base
budget,10 as the subcommittee subsequently did in a draft FY2012 Defense appropriations bill it
marked up June 1.
9

Rep. Howard P. “Buck” McKeon, “Obama Cuts Would Gut U.S. Defense,” USA Today, April 28, 1011,
http://www.usatoday.com/news/opinion/forum/2011-04-28-McKeon-blasts-Obama-defensecuts_n.htm#uslPageReturn.
10
See House Appropriations Committee press release, “Chairman Rogers Announces Schedule and Subcommttee
(continued...)

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In a speech to the American Enterprise Institute on May 2411 Defense Secretary Robert Gates said
that, as a practical matter, it was inevitable that projected future defense budgets would be scaled
back as part of the deficit reduction effort. He said that the President’s proposed reductions were
not unprecedented:
What’s being proposed by the President is nothing close to the dramatic cuts of the past. For
example, defense spending in constant dollars declined by roughly a third between 1985 and
1998. What’s being considered today, assuming all $400 billion comes from DOD over 12
years, corresponds to a projected reduction of about 5% in constant dollars—or slightly less
than keeping pace with inflation.

However, Secretary Gates also emphasized that the proposed reductions would require tough
decisions about such hitherto untouchable issues as the pay, pensions, and medical care of
military personnel and their families, and the type and number of missions U.S. forces could be
ready to handle.
If we are going to reduce the resources and the size of the U.S. military, people need to make
conscious choices about what the implications are for the security of the country, as well as
for the variety of military operations we have around the world if lower priority missions are
scaled back or eliminated.

Changing the Baseline
Negotiations surrounding legislation to increase the national debt ceiling resulted in enactment on
August 2, 2011, of the Budget Control Act of 2011 (BCA) which, among other things, set new
caps on discretionary spending in FY2012. While the law does not specifically mandate a
reduction in Defense appropriations below the President’s initial request, as a practical matter
such reductions may result.
One of BCA’s provisions sets a cap on discretionary appropriations for so-called “security
agencies”—a category that includes the DOD base budget, the Departments of Veterans Affairs
and Homeland Security, and the Energy Department’s National Nuclear Security Agency, as well
as the Department of State and various international activities funded by other federal agencies.
The cap required a reduction of $35.7 billion from the total amount the Administration had
requested for that category of agencies.
The DOD base budget accounts for 76.9% of the discretionary budget request for security
agencies’ funding. Thus, if the base budget had absorbed that share of the security agencies’
reduction (which was not required by the BCA), appropriations for the FY2012 DOD base budget
would have been $27.2 billion below the amount requested. In fact, the total appropriated for
DOD’s base budget by H.R. 2055, the Consolidated Appropriations Act for 2012, is $519.7
billion, a reduction of $23.7 billion from the request.

(...continued)
Spending Limits to Complete Appropriations Bills ‘On Time and On Budget’,” May 11, 2011,
http://appropriations.house.gov/index.cfm?FuseAction=PressReleases.Detail&PressRelease_id=298&Month=5&Year=
2011.
11
Defense Secretary Robert Gates, Speech to the American Enterprise Institute, May 24, 2011,
http://www.defense.gov//speeches/speech.aspx?speechid=1570.

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FY2012 National Defense Authorization Act (H.R.
1540; S. 1253; S. 1867)
On May 26, 2011, by a vote of 322-96, the House passed its version of the FY2012 National
Defense Authorization Act, H.R. 1540. Earlier, the House Armed Services Committee completed
its markup of the bill on May 11 and issued a report on May 17 (H.Rept. 112-78).
Overall, the House bill would have authorized $690.1 billion in discretionary budget authority for
programs covered by that bill. This includes $553.0 billion for DOD’s base budget and an
additional $118.9 billion for OCO. The remaining $18.1 billion the bill would have authorized is
for defense-related nuclear activities carried out by the Department of Energy.
Viewed in the aggregate, the House version of the bill would have made only minor changes to
President Obama’s funding request for programs covered by the authorization bill: The DOD
base budget request would have been trimmed by $1.7 million, while the $1.1 billion the bill
would have added to the request for war costs was accounted for almost entirely by the House
committee’s addition to the DOD budget of $1.1 billion for the Pakistan Counterinsurgency Fund,
a program which the Administration’s budget had funded through the State Department.12
The Senate Armed Services Committee’s initial version of the FY2012 authorization bill (S.
1253), reported on June 22, 2011, would have authorized $6.4 billion less that the Administration
requested for FY2012, of which $5.9 billion would have been cut from the base budget. On
November 15, 2011, to match the BCA-mandated FY2012 spending cuts for DOD and other
security agencies, the committee reported a second version of the bill, S. 1867, that would have
cut $27.3 billion from the President’s request, and would have authorized $28.4 billion less than
the House-passed bill (see Table 4). After debating and amending S. 1867 over the course of
several days, the Senate substituted the text of that bill for the House-passed text of H.R. 1540,
and passed the amended version of H.R. 1540 on December 1, 2011, by a vote of 93-7.
The conference report on H.R. 1540, which cuts the Administration’s authorization request by a
total of $26.6 billion, was adopted by the House December 14, 2011, by a vote of 283-136. The
part of the compromise bill that covers the DOD base budget would cut $23.1 billion from the
Administration’s $553.0 request. However, that reduction includes $6.9 billion requested for
activities which the conferees authorized, instead, in the part of the bill that authorizes costs
associated with operations in Iraq and Afghanistan (including $1.4 billion for procurement of
Predator and Reaper drone aircraft).
Despite that shift of funds from the base budget to the war budget, the conference report
authorizes a total of $2.3 billion less than was requested for war costs because the conferees’
additions to the war costs section are more than offset by large reductions to the Administration’s
war cost request. For example, the conferees cut $4.0 billion from the war cost request on the
grounds that, after the budget request was submitted, the President announced a more rapid
reduction in the number of U.S. troops deployed in Afghanistan than the budget had assumed.

12

Echoing action that Congress incorporated into the FY2011 funding bills, H.R. 1540 defers for one additional year
(in this case, through FY2012) the transfer from DOD to the State Department of the Pakistan Counterinsurgency Fund.

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Table 4. FY2012 National Defense Authorization Act Summary (H.R. 1540, S. 1253,
and S. 1867)
(amounts in millions of dollars)
FY2011
Authorization
H.R. 6523
(P.L. 111-383)

FY2012
Administration
Request

FY2012
House-Passed
H.R. 1540

FY2012
SASC-reported
S. 1253

FY2012
Senate-Passed
H.R. 1540
(debated as S.
1867)

FY2012
Conference
Report
H.R. 1540

Procurement

110,433

111,454

111,386

109,539

101,633

103,579

Research and
Development

76,587

75,325

75,580

74,859

71,841

71,571

Operations and
Maintenance

168,151

170,759

171,120

168,683

160,847

162,188

Military
Personnel

138,541

142,829

142,164

142,448

142,348

141,992

Other
Authorizations

36,274

37,900

38,016

37,892

37,411

37,565

Military
Construction
and Family
Housing

18,191

14,766

14,766

13,717

13,190

13,069

Subtotal:
DOD Base
Budget

548,176

553,033

553,032

547,139

527,270

529,964

Subtotal:
Atomic
Energy
Defense
Activities
(Energy
Dept.)

17,716

18,085

18,085

18,089

17,520

16,946

TOTAL:
FY2012 Base
Budget

565,891

571,118

571,117

565,228

544,790

546,910

Subtotal:
Overseas
Contingency
Operations

158,750

117,843

118,940

117,306

116,847

115,480

GRAND
TOTAL:
FY2012
National
Defense
Authorization

724,642

688,961

688,961

682,534

661,636

662,390

Source: H.Rept. 112-78, House Armed Services Committee, “Report on H.R. 1540, the National Defense
Authorization Act for Fiscal Year 2012;” S.Rept. 112-26, Senate Armed Services Committee, “Report to
accompany S. 1253, the National Defense Authorization Act for Fiscal Year 2012;” Senate Armed Services
Committee summary of S. 1867 as reported, “Summary of National Defense Authorizations for FY2012,”
November 17, 2011; funding tables in the text of S. 1867; H.Rept. 112-329, Conference Report to accompany
H.R. 1540, the National Defense Authorziation Act for Fiscal Year 2012.

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Authorization Bill Overview
Relationship of S. 1253, S. 1867, and Senate-passed H.R. 1540
Unless otherwise specified, all references in the balance of this report to “the Senate bill,” “the Senate version of the
FY2012 national defense authorization act,” or “S. 1867” all refer to the legislation that Senate passed on December
1, 2011, as an amended version of the House-passed H.R. 1540.
The text of this version of the bill was reported by the Senate Armed Services Committee on November 15, 2011, as
S. 1867, and it was debated by the Senate, and amended, as S. 1867 over a period of several days in late November.
On December 1, 2011, the amended text of S. 1867 was substituted for the text of the House-passed H.R. 1540
which the Senate then passed by a vote of 93-7.
Unless otherwise specified, S.Rept. 112-26, the Senate Armed Services Committee’s report on S. 1253, which was its
first version of the FY2012 authorization bill, applies to S. 1867, for which no committee report was prepared. By the
same token, it also applies to the Senate-passed version of H.R. 1540.

House-passed Bill (H.R. 1540)
The House bill’s total authorization was the net result of dozens of additions and subtractions to
various components of the President’s request. In its report accompanying the bill (H.Rept. 11278), the House Armed Services Committee cited a variety of policy and management
justifications for these proposed changes. Among the most costly of the policy-based increases
proposed by the committee were the following:
•

$1.31 billion to increase funding for maintenance, repair and upgrades to
facilities;

•

$375 million to continue production of M-1 tanks and Bradley troop carriers,
contrary to DOD’s proposal to shut down those production lines;

•

$310 million to accelerate development and production of various anti-missile
defense systems, including $110 million for systems designed and manufactured
in Israel, intended for that country’s defense; and

•

$325 for equipment for the National Guard and the other reserve components of
the armed services.

The House bill also incorporated recommended cuts to the DOD budget request. Among the
largest of the proposed reductions aimed at specific weapons programs were cuts of:
•

$523.9 million—all but $15.7 million of the amount requested—from an Army
airborne electronic eavesdropping system designated the Enhanced, MediumAltitude Reconnaissance and Surveillance System (EMARSS), a package of
cameras and electronic eavesdropping gear installed in a small, twin-engine
Beechcraft commercial plane. The committee said delays in the program justified
the reduction;

•

$148.7 million from the amount requested for the Army’s Early Infantry Brigade
Combat Team (E-IBCT), an effort to equip infantry units with a digital network
that DOD cancelled in February 2011. The committee said that, at the Army’s
request, it was eliminating this amount and shifting the remainder of the funds
requested for E-IBCT ($89.9 million) to other purposes;

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•

$149.5 million from the MEADS anti-missile system, which is being jointly
developed by the United States, German, and Italy, but which the Pentagon has
decided not to purchase.

The largest single group of budget cuts the House committee incorporated into H.R. 1540
reflected its judgment that many DOD budget accounts held funds, appropriated in prior years,
which would not be obligated by the end of FY2011. On grounds that these “unobligated
balances” could be used in lieu of new budget authority to cover some of the cost of DOD’s
FY2012 program, the committee cut a total of $2.66 billion from the amount of new budget
authority requested for various accounts.
The House committee also incorporated into H.R. 1540 across-the-board cuts in the operations
and maintenance accounts totaling $59.7 million to reflect 10% reductions in the amounts
requested for printing (a cut of $35.7 million) and for the performance of studies and analysis by
outside think-tanks (a $24.0 million reduction).

Senate Committee-reported Bills (S. 1253, S. 1867)
The Senate Armed Services Committee’s net reduction of $6.43 billion to the President’s request
in its initial version of the FY2012 NDAA (S. 1253) resulted from dozens of specific reductions,
many of which were relatively small. To achieve the additional reduction in S. 1867, the
committee retained the earlier cuts and added hundreds more.
The committee insisted in its report on S. 1253 (S.Rept. 112-26) that many of its cuts in that bill
would have no adverse impact on Pentagon operations because they involved funds that would
not be needed during FY2012 due, for example, to program delays, the inclusion in the request of
funding for overhead costs that the committee deemed excessive, or what the committee
described as lackluster performance. Although the committee did not issue a report to accompany
S. 1867, the summary funding tables incorporated in that bill included brief characterizations
consisting of no more than a few words each—justifying those cuts in terms that were generally
similar to the rationales cited in S.Rept. 112-26 for the cuts in S. 1253.
The largest single cuts in S. 1867 related to U.S. operations in Afghanistan. The committee cut $5
billion from the $117.8 billion request for war costs on the grounds that, in June 2011, President
Obama announced a decision to reduce U.S. troop strength in that country. The bill also cut $1.6
billion from the $12.8 billion requested for training, equipping, and sustaining the Afghan Army
and National Police.
Some of the other major reductions incorporated in S. 1867 included
•

A total of $1.1 billion, distributed across several operation and maintenance
(O&M) accounts to reduce what the committee called in its report a “bloated”
budget request for contract services;13

•

A total of $684 million from the O&M accounts in anticipation that, as
historically has been the case, DOD agencies asked for more money in these

13

S.Rept. 112-26, pp. 86-87. According to the committee report on S. 1253, DOD’s base budget for FY2012 included
$150 billion for contract services, more than double the amount DOD spent for that purpose in FY2000.

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accounts than they could spend in the course of the fiscal year, leaving them with
excessively large “unobligated balances” at year’s end;
•

$350 million, about one-eighth of the $2.80 billion requested, for the Joint
Improvised Explosive Device Defeat Organization (JIEDDO), an umbrella
organization that was created to coordinate DOD efforts to neutralize the
roadside bombs widely used against U.S. troops in Iraq and Afghanistan. The
committee said the organization had not done enough to eliminate duplicative
efforts and was too dependent on contractor personnel;

•

$752 million requested for aircraft that were included in the FY2012 budget sent
to Congress in February, but which, subsequently, had been funded in the
FY2011 Defense appropriations bill, enacted April 15 as part of the FY2011
omnibus spending bill (P.L. 112-10). The items eliminated from the bill included
nine F/A18E/F Navy fighters ($495 million), one E-2D Hawkeye radar
surveillance plane ($164 million), two HH-60M Blackhawk helicopters modified
for combat search and rescue ($70 million), one Apache attack helicopter ($36
million), and upgrades for various helicopters used by special forces ($151
million); and

•

$200 million from the $2.98 billion requested for the Defense Advanced
Research Projects Agency (DARPA) for a combination of reasons including
concern about the agency’s history of excessive unobligated balances and the
committee’s doubts about the feasibility of some projects the agency is funding.
The panel was skeptical of an effort to develop a Transformer Vehicle that would
combine attributes of a vertical take-off aircraft and a HMMWV (Humvee).

In addition, S. 1867 would have cut a total of $1.18 billion from four major weapons programs14
(including three of which the House bill also would have cut), including
•

$540 million from an Army airborne surveillance system designated the
Enhanced Medium-Altitude Reconnaissance and Surveillance System
(EMARSS);

•

$407 million from the Army’s effort to develop a new family of digitally linked
combat equipment;

•

$135 million (of the $877 million total) requested to develop a new mid-air
refueling tanker (designated KC-46A), funds that the committee said the program
would not need in FY2012; and

•

$407 million for the multinational Medium Extended Air Defense System
(MEADS) anti-aircraft and anti-missile defense system.

14
At the request of the Marine Corps, the Senate Committee cut $300 million from the budget request for mediumsized trucks but reallocated the funds to other Marine Corps priorities and thus did not reduce the overall amount
authorized by the bill.

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Conference Report (H.R. 1540)
Like the Senate-passed version of H.R. 1540, the final version of the bill cut the President’s
request by nearly 4% using a handful of large reductions—most of them related to war costs—
and hundreds of other cuts in specific programs.
Among the major reductions associated with Afghanistan were cuts of:
•

$4.0 billion to take account of the President’s plan to reduce the number of troops
in Afghanistan;

•

$1.6 billion (from the $12.8 billion requested) to train, equip and sustain the
Afghan Army and National Police; and

•

$75 million (from the $475 million requested) to develop infrastructure in
Afghanistan.

Other reductions in the bill totaling nearly $3.4 billion would have no impact on DOD operations,
the conferees said, including cuts of:
•

$1.5 billion from the Army’s operation and maintenance budget which, according
to DOD and the Army, would not be needed;

•

$1.3 billion which, the conferees said, could be offset by unnecessarily large cash
balances in certain revolving funds and by so-called unobligated balances in
certain accounts, which are funds appropriated in prior years but not yet spent;
and

•

$330 million from the Tricare medical insurance program which, according to the
conferees, was the amount by which the request for that account exceeded
average annual outlays;

The conference report also made some cuts that were intended to curtail certain activities,
including cuts of:
•

$412.0 million from amounts requested for logistical support of weapons systems
by contractors;

•

$150.2 million from the amounts requested for federally funded research and
development centers (FFRDCs) such as the RAND Corporation; and

•

$200.0 million requested for DOD’s Acquisition Workforce Development Fund.

Among the largest reductions to specific weapons program made by the conference report were
cuts of:
•

$595.0 million (from the $3.2 billion) requested for Mine-Resistant, AmbushProtected (MRAP) vehicles, funds which the conferees said had been provided in
FY2011;

•

$539.6 million, the full amount requested for the Army’s EMARSS airborne
surveillance system; and

•

$435.0 million (of the $884.4 million requested) from the Army’s effort to
develop a new armored combat vehicle.

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Compared with other defense authorization bill in recent years, there were relatively few cases in
which the conference report on H.R. 1540 authorized more than was requested for a particular
weapons program. Among the larger increases the bill authorized are:
•

$255.0 million to continue upgrading existing M-1 tanks;

•

$325.0 million for equipment to modernize National Guard and reserve forces;
and

•

$110.0 million (in addition to the $106.1 million requested) to collaborate with
Israel on the development of certain anti-ballistic missile systems.

Earmarks and Add-ons
Compared with annual defense authorization bills in the recent past, the conference report on
H.R. 1540, like both the House and Senate versions of the bill includes fewer Member-sponsored
funding initiatives (widely referred to as “earmarks”). Of more than 200 provisions of the House
bill that would have increased the authorization for relatively specific purposes, all but one were
dropped from the conference report.

House Add-ons
Early in the House committee’s process of addressing the FY2012 DOD budget request, the
committee’s chairman, Representative Howard P. “Buck” McKeon, announced that the
authorization bill would be marked up in compliance with the policy of the House Republican
Conference that bans for the duration of the 112th Congress the adoption of “earmarks” defined
by the rules of the House. He also announced that any Member-sponsored amendment to the
committee’s draft bill would be subject to a vote by the full committee in open session.
Clause 9 of House Rule XXI defines a congressional earmark as
a provision or report language included primarily at the request of a Member, Delegate,
Resident Commissioner, or Senator providing, authorizing, or recommending a specific
amount of discretionary budget authority, credit authority, or other spending authority for a
contract, loan, loan guarantee, grant, loan authority, or other expenditure with or to an entity,
or targeted to a specific State, locality, or Congressional district, other than through a
statutory or administrative formula-driven or competitive award process.15

In the course of a markup session that began on May 11, 2011, and ran into the early hours of
May 12, the House committee approved more than 200 amendments, most of them by voice votes
on en bloc groupings, that incorporated several amendments that increased the amount authorized
for particular purposes. However, compared with similar Member-sponsored additions to earlier
defense bills, the purposes of the add-ons to H.R. 1540 were defined in less specific terms than
has been typical of similar member initiatives in recent years that clearly identified a specific
intended recipient of the added funds.
Compared with the FY2010 authorization bill reported by the House Armed Services Committee
in June 2009 (H.R. 2647; H.Rept. 111-166), the committee’s FY2012 defense bill contained
15

U.S. Congress, House, House Rules and Manual, §1068d.

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about one-fourth the number of Member-sponsored add-ons. However, in toto, this smaller
number of add-ons would have added roughly the same amount of money.16 In the titles of the
annual authorization bills that authorize Procurement and Research & Development, as reported
by the House Armed Services Committee:
•

The FY2010 bill included 372 earmarks each with a value of less than $100
million,17 providing a total of $1.37 billion (for an average value per earmark of
$3.7 million); and

•

The FY2012 bill included 98 committee additions with a value of less than $100
million, providing a total of $1.30 billion (for an average value per addition of
$13.3 million).

The impact of the new approach to Member-sponsored funding initiatives is even more striking in
a comparison of portions of the authorization bills for FY2010 and FY2012 that cover military
construction projects:
•

The FY2010 bill included 110 military construction earmarks for specific
projects at specific sites with a total value of $579 million; and

•

The FY2012 bill would have added to the construction request 22 lump-sum
amounts—all but two of them in the amount of $10 million or $20 million—for
general classes of facilities (e.g., maintenance and production facilities, troop
housing facilities, operational facilities) with the additional funds available for
use at “unspecified worldwide locations.”

“Mission Force Enhancement Transfer Fund”
In previous defense authorization bills reported by the House Armed Services Committee,
additions to the budget request typically have been listed in the funding tables that are part of the
committee report on the bill. By contrast, most18 of the committee’s additions to H.R. 1540 are
listed in the text of the bill (Title XVI), each addition being accompanied by the stipulation that
the additional funds be allocated to a specific entity only on the basis of “merit-based” or
“competitive” procedures.
16
Direct comparisons between H.R. 1540 and defense authorization bills reported by the committee in the recent past is
complicated by the fact that, because the committee’s procedure precludes the inclusion of “earmarks” in H.R. 1540,
there is no “earmark” list appended to its report on the bill, as there were in the committee’s reports on earlier defense
bills reported beginning in 2007. This analysis compares the authorization bills for FY2010 and FY2012, as reported by
the House Armed Services Committee and focuses on additions to the budget request of less than $100 million, which
encompasses the vast majority of add-ons to each bill and all but one of the earmarks that to the FY2010 bill that are
identified by the committee.
In bills for which the House Armed Services Committee prepared “earmark” lists, it did not treat as “earmarks” a
relatively small number of large initiatives, which the committee regarded as policy initiatives sponsored by the
committee itself, rather than as requests by an individual member. For example, the committee did not list as an
earmark its addition to the FY2010 defense bill (H.R. 2647) of $601 million to continue developing, as an alternative
engine for the F-35 Joint Strike Fighter, the F-136 jet being developed by General Electric and Rolls-Royce. Similarly,
H.R. 1540 includes a handful of relatively large add-ons which are discussed in the committee report as policy issues.
17
The committee report lists only one earmark in the bill worth more than $100 million, which is the addition of $105
million for procurement of a C-40 executive jet.
18
The relatively few exceptions to this generalization involve large sums (more than $100 million each) and high
profile issues of defense policy (e.g., whether or not to continue the production line for M-1 tanks and Bradley troop
carriers).

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The committee covered the cost of most, though not all, of those add-ons costing less than $100
million each by drawing down funds in a new account, called the Mission Force Enhancement
Transfer (MFET) Fund, which it had funded with $1 billion that had been cut from various parts
of the DOD budget request. Program add-ons adopted by the committee during the markup of
H.R. 1540 absorbed $651.7 million of the $1 billion, leaving a balance in the MFET Fund of
$348.3 million.
As reported, the bill would have authorized the Secretary of Defense to draw money from the
fund balance to meet unfunded requirements in any of seven areas: missile defense; shipbuilding;
shortages in the number of strike fighters; mine warfare; intelligence, surveillance and
reconnaissance; basic research; and the ability to defeat precision-guided ballistic missile and
other weapons intended to bar access of U.S. forces to certain areas. However, by a vote of 269151, the House adopted an amendment eliminating from the bill the $348.5 million that remained
in the MFET fund (see Table 5).

Senate Add-ons
In the Senate, the “no earmark” rule had an even more dramatic impact on the FY2012 defense
authorization bills reported by the Armed Services Committee. The committee’s initial bill (S.
1253), which was reported several weeks before the enactment of the substantial, BCA-mandated
additional reductions, included only 37 instances in which the committee added funding to the
budget request, with a total budget increase of $1.64 billion.19 In writing a second version of the
defense bill (S. 1867) to meet the spending limits set by the Budget Control Act, the committee
made hundreds of additional cuts to the budget request, no further additions, and reduced the
amount of some of the additions it had made in S. 1253.
The largest single amount the committee added to the budget request was $405 million added to
Operations and Maintenance funds intended, the committee said in its report on S. 1253, “to
reimburse expenses deferred to fund foreign operations.” The report does not elaborate on that
statement.
By way of comparison, the version of the FY2010 defense authorization bill that the Senate
Armed Services Committee reported on July 2, 2009 (S. 1390), included 336 additions (excluding
military construction) with a total budgetary increase of $5.17 billion—nearly nine times as many
additions and more than three times the total cost of the additions in S. 1253.

Military Personnel Issues
For military personnel costs in the base budget, the House-passed version of H.R. 1540 would
have authorized $142.2 billion of the $142.8 billion requested, with a few minor increases more
than offset by a proposed reduction of $664.7 million to be made up for by unobligated balances
in the military personnel accounts, left over from prior fiscal years.
As passed by the Senate, the bill would have authorized $142.4 billion for military personnel
costs in the base budget, which is $481.2 million less than was requested. The Senate committee
19

This comparison excludes funding increases that were, in effect, amendments to the budget request made at the
request of DOD or one of the armed services.

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justified the bulk of the reduction ($325.6 million) on the basis of unobligated balances in
appropriations accounts that could be used to offset those cuts.
The final version of H.R. 1540 authorizes $142.0 billion for military personnel costs in the base
budget, a reduction of $837.0 million from the request. That reduction includes $448.0 million the
bill shifted from the base budget to the military personnel authorization in the section of the bill
authorizing war costs.
Additional Detail on Selected FY2012 Military Personnel Issues
For a more detailed analysis of military personnel issues in the FY2012 budget see CRS Report R41874, FY2012
National Defense Authorization Act: Selected Military Personnel Policy Issues, coordinated by (name redacted).

Pay Raise
Like the Senate-passed bill, the final version of H.R. 1540 includes no provision specifically
authorizing the 1.6% military pay raise requested by the Administration. However, the House and
Senate Armed Services Committees each supported that request and the practical effect of the bill
is to allow it to take effect. By law, military personnel and federal civilian employees receive
annual pay raises at a rate that matches the Labor Department’s Employment Cost Index (ECI)—
a survey-based estimate of the past year’s increase in private sector pay—unless a different pay
rate is established by statute. The Congressional Budget Office (CBO) estimates the cost of a
1.6% increase in military basic pay for FY2012 to be $1.2 billion.
The House-passed bill includes a provision (Section 601) that would have authorized a 1.6% raise
in service members’ basic pay, as requested. However, the absence of such a provision in the
final bill has no practical effect.

End Strength and “Dwell Time”
The conference report on H.R. 1540, like the Senate-passed version, authorizes the
Administration’s proposal to reduce the active-duty force by 9,800, setting the end-strength of the
force (i.e., the number of troops on the rolls on the last day of FY2012) at 1.42 million
personnel.20 However, in their respective reports on the bills, both Armed Services Committees
expressed concern that the planned reduction in forces might allow individuals less “dwell time”
between deployments than the Army aims to provide.
DOD’s goal is for active-personnel to spend three years at their home station for every year
deployed, to allow rest, retraining in missions other than the particular mission on which they
were deployed, and renewal of family ties. Despite that goal of achieving a dwell time ratio (time
deployed to time at home) of one-to-three, current operations require deployments at such a pace
that the ratio is much lower, and DOD hopes to improve the dwell time ratio to one-to-two by the
end of FY2012.
The House committee questioned the wisdom of the Administration’s plan to reduce active-duty
Army end-strength by 22,000 in FY2013 and to further reduce the size of the active-duty Army
and Marine Corps by a total of 42,300 personnel in FY2015-FY2016, assuming that the
20

The House bill would have increased the Navy’s end-strength ceiling by 39 above the number requested.

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commitment of combat forces in Afghanistan would be substantially reduced by the end of
FY2014.
It remains unclear to the committee what the level of forces in Afghanistan would need to be
reduced [to] in order to allow the force reduction to begin without an adverse impact on
troops and their families. More importantly, the anticipated reductions appear to have no
relationship to the requirements of overall national strategy or to future warfighting
requirements.21

Similarly, the Senate committee expressed concern that, if the drawdown were carried out too
quickly, while large U.S. forces remain deployed in Afghanistan and Iraq, troops would have too
little time at home between deployments abroad.
The final version of H.R. 1540 includes a House-passed provision (Section 522) requiring the
Secretary of Defense to establish a policy on dwell time and to establish a data base that would
monitor service member’s actual ratio of time deployed to time at home.

Shaping the Drawdown
In its report, the Senate committee urged DOD, in deciding where to make further cuts in the
force, to be mindful of service members who have served during a decade of combat operations,
but have not yet completed the 20 years of service required to qualify for military retired pay:
[F]uture reductions in force, while necessary, must be accomplished in a responsible manner,
taking into account the wartime service and contribution of service members, particularly
those with over 15 years of service. The nation owes it to our service members and their
families, especially after enduring the challenges of 10 years of war, to carefully balance
many factors in deciding how to draw down responsibly and fairly.22

National Guard, the JCS, and Other Reserve Component Issues23
The final version of H.R. 1540, like both the House and Senate versions of the authorization bill,
contains a provision making the Chief of the National Guard Bureau a member of the Joint Chiefs
of Staff (JCS). The conference provision (Section 512) also provides that, as a JCS member, the
Guard chief “has the specific responsibility of addressing matters involving non-Federalized
National Guard forces in support of homeland defense and civil support missions.”

Vice Chief of the National Guard Bureau
In 1994, Congress established the position of Vice Chief of the National Guard Bureau, with the
grade of major general (two-star rank).24 The position was redesignated as the Director of the
National Guard Bureau Joint Staff 10 years later to reflect the duties of the position in light of the

21

H.Rept. 112-78, Report on the National Defense Authorization Act for FY2012, pp. 127-28.
H.Rept. 112-26, p. 105.
23
This section was prepared by (name redacted), Specialist in Military Manpower Policy.
24
P.L. 103-337, section 904(a).
22

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bureau’s reorganization, which included a joint staff drawn from both Army and Air National
Guards.25
The conference version of H.R. 1540, like the versions passed by the Senate and House, includes
a provision that reestablishes the position of Vice Chief with the grade of lieutenant general
(three-star rank). Like Section 511 in the final bill, the corresponding provisions in the bills
passed by the House (Section 511) and the Senate (Section 1602) specify that the Vice Chief is to
be nominated by the President subject to Senate confirmation.

National Guard Relationship with U.S. Northern and Pacific Commands
The conference report on H.R. 1540 dropped from the bill a provision in the Senate version
(Section 1607) which would have specified that United States Northern Command
(NORTHCOM) and United States Pacific Command (PACOM) are the combatant commands
primarily responsible for defense support of civil authorities in the United States. The Senate
provision also would have required the NORTHCOM and PACOM commanders, in the discharge
of this responsibility, to:
•

Assist states in the employment of National Guard forces under state control, in
consultation with and acting through the Chief of the National Guard Bureau and
state National Guard headquarters;

•

Facilitate the deployment of active duty forces to augment and support National
Guard forces under state control; and

•

Develop a memorandum of understanding with the Chief of the National Guard
Bureau setting forth operational relationships and individual roles and
responsibilities during responses to domestic emergencies.

The conference report includes a modified version of another provision of the Senate bill (Section
1608) that would have stipulated that the commander of Army North Command (a subordinate
command of NORTHCOM) shall be an Army National Guard officer and the commander of Air
Force North Command (another subordinate command of NORTHCOM) shall be an Air National
Guard officer. In the final version of the bill, that provision was modified to require that fully
qualified officers of the Army and Air National Guard be considered for appointment to those
positions (Section 518).

Reserve Activation Authorities
The final version of H.R. 1540 includes two provisions that give executive branch officials more
flexibility to activate units and individuals in the reserve components.
Section 516 in the conference version of the bill, which is very similar to Section 511 in the
Senate bill, adds a new authority to involuntarily call up individuals and units of the Selected
Reserve, and the Individual Ready Reserve’s “mobilization category,”26 for up to 365 days of
25

P.L. 108-375, section 508.
10 U.S.C. 10144(b) specifies that individuals may not be placed in the Individual Ready Reserve mobilization
category unless "(A) the member volunteers for that category; and (B) the member is selected for that category by the
Secretary concerned, based upon the needs of the service and the grade and military skills of that member." DOD has
(continued...)
26

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active duty. No more than 60,000 members of the National Guard and Reserves may be serving
on active duty under this authority at any given time. The authority to activate reservists under
this provision rests with the service secretary, but it may only be invoked for missions that are
“preplanned” and where the reserve component activations were budgeted for.
According to the Senate Armed Services Committee report on the Senate bill, this new authority
“is not designed for use for emergent operational or humanitarian missions, but rather to enhance
the use of reserve component units that organize, train, and plan to support operational mission
requirements to the same standards as active component units under service force generation
plans in a cyclic, periodic, and predictable manner.”27 There was no analogous provision in the
House bill. The provision in the final bill was modified to provide that this authority could be
used only preplanned missions in support of a combatant command.
A second provision of the final version of the bill, Section 515, which was adopted without
change from the Senate version of the bill, allows the Secretary of Defense to involuntarily order
units and individuals of the Army Reserve, Navy Reserve, Marine Corps Reserve, and Air Force
Reserve to active duty for up to 120 days “when a governor requests federal assistance in
responding to a major disaster or emergency.” National Guard forces are not included in this
authority, but state governors already have the ability to activate their state National Guard forces
and to request support from other state National Guards under the Emergency Management
Assistance Compact. The Coast Guard Reserve already has a short-term, disaster response
activation authority (14 U.S.C. 712). There was no analogous provision in the House bill.

TRICARE Fees
The final version of H.R. 1540 allows the Administration to increase (for the first time since
1995) enrollment fees for TRICARE Prime, an HMO-style managed care plan that offers the
most comprehensive coverage among the nine options offered by DOD’s TRICARE medical
insurance programs for servicemembers, retirees, and their dependents. Accordingly, as the
Administration had proposed in its FY2012 budget request, enrollment fees for TRICARE Prime
increased by $30 per year for individuals (to $260) and by $60 per year for families (to $580).
However, for FY2012 and for later years, the bill (Section 701) allows the fees to increase no
faster than the rate of increase of military retired pay. The Administration had proposed that, in
future years, the fees increase annually at the same rate as the National Healthcare Expenditure
(NHE) Index, a measure of health spending calculated by the federal agency that manages
Medicare and Medicaid. The NHE index is projected to increase at an average annual rate of 5%6% over the next decade.28
The House Armed Services Committee (HASC) Personnel Subcommittee proposed including in
H.R. 1540 a one-year prohibition on increasing TRICARE Prime fees, similar to prohibitions
(...continued)
not made it a priority to fill this "mobilization category" and currently there are no members assigned to it..
27
S.Rept. 112-26, p. 110.
28
Testimony of Jonathan Woodson, M.D., Assistant Secretary of Defense (Health Affairs) before the Senate Armed
Services Committee Personnel Subcommittee, May 4, 2011, available at http://www.tricare.mil/tma/
congressionalinformation/downloads/2011/05-04-11%20SASCP%20DoD%20Focus%20Hearing%20Statement%20_Woodson_%20-%20FINAL.pdf.

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Congress has included in several prior defense authorization bills. But instead, the full House
committee included in the bill a provision (Section 701) that would have limited increases in any
future year to the percentage by which military retired pay is increased in the same year. In its
analysis of H.R. 1540, the Congressional Budget Office estimated that this provision would allow
the fees to increase by about 2% annually over the next decade.29
The Senate bill contained a similar provision (also designated Section 701). However, in its report
on the bill the Senate committee said it would consider options for phasing in a more rapid
increase in TRICARE fees, as early as FY2014.

Don’t Ask, Don’t Tell30
The final version of H.R. 1540, included a provision (Section 544)—identical to a provision the
the Senate had adopted as an amendment to its version of the bill—allowing any military chaplain
to decline, on grounds of conscience or moral principle, to officiate at any marriage. That issue
had been raised by some critics of the repeal in December 2010 of the 1993 law barring openly
homosexual persons from military service, a policy colloquially referred to as “don’t ask, don’t
tell” (DADT).31
The conference report did not include any of three provisions of the House-passed bill backed by
opponents of DADT repeal. These provisions would have:
•

Deferred repeal of the 1993 law until the senior uniformed officer of each service
certifies, in writing, that repeal would not degrade the combat readiness,
cohesion, or morale of units (Section 533).

•

Affirmed that any DOD ruling or regulation concerning a service member of
DOD civilian employee will conform with the provision of the Defense of
Marriage Act (P.L. 104-199) which defines “marriage” as only a legal union of
one man and one woman (Section 534).

•

Required that any marriage performed in a DOD facility or by a military chaplain
or other DOD official acting in an official capacity conform to the same
definition of “marriage” (Section 535).

The conference report did take one other action that was supported by some critics of DADT
repeal, by dropping a provision in the Senate bill (Section 551) that would have repealed Article
125 of the Uniform Code of Military Justice (UCMJ), which prohibits sodomy and bestiality. The
provision also would have amended Article 120 the UCMJ to prohibit forcible sodomy.
In its report on the bill, the Senate Armed Services Committee said the proposed change had been
recommended by the Joint Services Committee on Military Justice, which is a committee of
senior military lawyers, and by a DOD task force that made recommendations in 2009 to reduce
the incidence of sexual assault in the military. The committee said that all instances of forcible

29

H.Rept. 112-78, Part 2.
For background, see CRS Report R40782, “Don’t Ask, Don’t Tell”: Military Policy and the Law on Same-Sex
Behavior, by (name redacted), and CRS Report R40795, “Don’t Ask, Don’t Tell”: A Legal Analysis, by (name redacted).
31
The 1993 legislation was repealed by H.R. 2965 which was enacted on December 22, 2010 as P.L. 112-321.
30

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sodomy that currently could be prosecuted under Article 125 could be prosecuted under Article
120 as amended by the bill. However the committee’s action drew some public objections.
Analysis of issues related to the “Don’t Ask, Don’t Tell” Policy
For a more comprehensive analysis of issues related to legislation and DOD policy concerning service of openly
homosexual persons in the Armed Forces, see CRS Report R40782, “Don’t Ask, Don’t Tell”: Military Policy and the Law
on Same-Sex Behavior, by (name redacted), CRS Report R40795, “Don’t Ask, Don’t Tell”: A Legal Analysis, by (name redacted).

Women in Combat
In its report on H.R. 1540, the House committee took a matter-of-fact approach to the sometimes
contentious issue of military women being placed in combat situations. The committee noted that
it had heard from a number of service women who had been deployed in Iraq and Afghanistan
that they found body armor designed for male soldiers to be restrictive and uncomfortable.
The committee notes that the current counterinsurgency and dismounted operations in [Iraq
and Afghanistan] place service women in direct combat action with the enemy. The
committee believes there is merit in conducting an evaluation as to whether there is an
operations need to tailor interceptor body armor systems…specifically for the physical
requirements of women…. The committee commends the Army for acknowledging this issue
and encourages the acceleration of these efforts to help determine the most effective
organizational clothing and individual equipment, to include body armor and associated
components, for military service women.32

Acquisition Policy
Both the House and Senate versions of the defense authorization bill included provisions intended
to promote greater use of competitive procedures in DOD contracting for the acquisition and
maintenance of weapons systems.

Competition-Promoting Provisions
The conference report on H.R. 1540 incorporated (in some cases, with modifications) several
provisions drawn from the House and Senate versions of the bill that are intended to promote
greater use of competition in DOD contracting, not only for complex weapons but also for their
principal components.
For instance, the final version of the bill includes (Section 837) a modified version of a provision
in the House bill (Section 326) ) requiring DOD to consider using competitive procedures in
awarding maintenance contracts for components and subsystems of major weapons. Noting in its
report on H.R. 1540, that the Weapons System Acquisition Reform Act (WSARA) of 2009 (P.L.
111-23) requires the use of competitive procedures in maintaining a weapons system, the House
Armed Services Committee faulted DOD for relying unnecessarily on sole-source maintenance
contracts.33
32

H.Rept. 112-78, pp. 48-49.
For background on WSARA, see CRS Report RL34026, Defense Acquisitions: How DOD Acquires Weapon Systems
and Recent Efforts to Reform the Process, by (name redacted), pp. 19-20.
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As an example of the potential for savings, the committee estimated that DOD could reduce its
annual maintenance costs by $2 billion if it awarded competitively the maintenance contracts for
the large number of its jet engines that are variants of commercial engines for which there are
many suppliers and maintenance contractors.
The final version of the authorization bill also incorporated provisions drawn from the House and
Senate versions that:
•

Require the Air Force conduct a competition to select the engines to be used in a
new long-range bomber the service is trying to develop (Section 220);34

•

Require the Navy to designate as a “major subprogram” an electro-magnetic
catapult intended to launch planes from the Navy’s next class of aircraft carriers,
with the aim of ensuring high-level oversight of the catapult program (Section
221);35

•

Require DOD to report on how it plans to implement, as part of the F-35 Joint
Strike Fighter Program, provisions of WSARA that require major weapons
programs to allow for the possibility of periodic re-competition for the prime
contract and for major subcontracts (Section 149);36

•

Prohibit the Navy from spending more than 75% of the $121.2 million authorized
for the Unmanned Carrier-Launched Airborne Surveillance and Strike
(UCLASS) system—a program to develop a long-range, drone bomber—until
DOD certifies to Congress that the program incorporates “open architecture
standards” (Section 213).37 An open architecture is a computer or software
system based on specifications that are publicly known and thus relatively easy to
modify with products of a manufacturer other than the original contractor—a
characteristic intended to encourage competition designing and building the
system and its components.

The conference report rejected the Senate’s proposal to shift the authorization of $142.2 million
for the development of improved communication satellites out of the budget line that funds
improvements in the existing satellites into a new budget line. In its report, the Senate Armed
Services Committee had contended that the proposed change would enhance competition by
giving companies not associated with the current satellite a better chance of competing for the
funds.

34

This is a modified version of a provision in the House bill that also was designated Section 220.
Unlike the corresponding House provision (also Section 221), the conference report’s restriction would lapse once
operational testing of the so-called Electro-Magnetic Aircraft Launch System (EMALS) has been completed.
36
This provision is identical with Section 153 of the Senate-passed version of H.R. 1540.
37
The House bill included a provision (Section 223) that would have barred spending more than 15% of the UCLASS
appropriation until DOD officials certified to Congress certain details about its plans for producing the aircraft. The
Senate bill included a provision (Section 213) that would have prohibited spending more than 50% of the UCLASS
funds until DOD officials reported certain details about the program and certified that it would entail “open
architecture.”
35

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Other Acquisition-related Provisions
Political Contribution Reporting Ban
The final version of H.R. 1540 included a provision (Section 823) similar to Section 847 of the
House version of the bill that prohibits the government from requiring, as a condition of bidding
on a government contract, that the bidder disclose any political contributions, except to the extent
that the collection and disclosure of such information is allowed by the Federal Election
Campaign Act of 1971 (P.L. 92-225).
The Senate version of the bill included a similar provision (Section 845) that would have applied
only to DOD contractors. A widely reported (but never issued) draft executive order would have
required the bidders to disclose political contributions to any candidate or party competing for a
federal office in the two years preceding the bid.

Allowable Cost Limits on Contractor Salaries
Both the House and Senate versions of H.R. 1540 would have expanded the scope of an existing
limitation on the amount of total compensation for certain employees which a contractor could
claim as a reimbursable cost under certain types of contracts. Under current law (10 U.S.C.
2324e.1), no contractor could claim as an allowable expense on a federal contract more than
$693,951.00 in total annual compensation for any of its five most senior executives.38
Section 803 of the House-passed bill would have extended that cap on allowable compensation
costs to cover all contractor employees. As reported by the Senate Armed Services Committee,
Section 842 of the Senate bill would have extended the cap to cover all executives of a firm, but
not other employees. During Senate debate on the bill, an amendment was adopted that would
have lowered the cap on the amount of compensation for an executive that could be claimed as a
reimbursable expanse to the annual compensation of the President of the United States (currently
$400,000).
The final version of H.R. 1540 retains the current cap on allowable compensation rather than
reducing it to the level of the President’s compensation. However the final bill (Section 803)
applies the cap to all contractor employees except that the Secretary of Defense may allow for
narrowly targeted exceptions for scientists and engineers.

Nunn-McCurdy Triggers
The final version of the bill includes a Senate provision (Section 831) that modifies the so-called
Nunn-McCurdy rules which require various high-level reviews of any acquisition program that
exceeds its baseline cost estimate by more than a specified percentage.39 The provision exempts
from this requirement programs for which a sharp rise in the projected unit-cost was the result of
a decision to reduce the number of units that would be purchased.
38

The amount of that cap is calculated by the Office of Federal Procurement Policy (OFPP) using a methodology
prescribed in 41 U.S.C. 435.
39
In the Senate bill, this was Section 801. For background, see CRS Report R41293, The Nunn-McCurdy Act:
Background, Analysis, and Issues for Congress, by (name redacted).

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Hedging Against Technical Risk
The final version of H.R. 1540 reversed or ameliorated four steps that would have been mandated
by the Senate bill which the Senate Armed Services Committee had justified as efforts to slow or
kill high-profile development programs which the committee said were technically promising but
risky and, in any case, lower priorities than other projects that could produce usable weaponry
sooner.
Section 212 of the Senate version of the bill would have barred any funding for development of a
new satellite communication system for the B-2 stealth bomber until the Air Force sends
Congress a detailed report on the projected cost and schedule of the effort. At issue is the effort to
develop an antenna that would allow the plane to send and receive information over the
Pentagon’s satellite-based global information grid 100 times as fast as the bomber’s current
communication system. The committee said it wanted more detailed analysis of the technical
risks of developing a novel type of antenna the bomber would need, including the risk that the
antenna would compromise the plane’s stealthiness.
The final version of the bill (Section 216) allows the Air Force to spend no more than 60% of the
amount appropriated for the new satellite before submitting to Congress the report as described in
the Senate provision. The bill would authorize $224.5 million of the $285.0 million requested for
the communications upgrade.
The final version also authorizes the amounts requested for two programs for which the Senate
bill would have denied funding:
•

$30.0 million to continue work on the so-called “free electron” laser, one of
several types of lasers the Navy is considering to protect ships against cruise
missiles and swarms of small speedboats; and

•

$26.9 million to continue development of an electromagnetic “rail gun”—a Navy
project intended to use magnetic energy rather than gunpowder to propel bullets
and artillery shells for ships’ self-defense and to strike distant surface targets.

The final version of H.R. 1540 also makes a smaller reduction than the Senate version would
have done in the funding requested to continue testing the Airborne Laser Test Bed (ALTB)—a
modified Boeing 747 equipped with a massive, anti-missile laser. The Senate bill would have cut
$60.0 million the request whereas the final version cuts $46.3 million from the program.40

“Counterfeit” Electronic Components41
The final version of the bill includes a provision (Section 818) that was a modified version of a
provision of the Senate bill (Section 848) that would allow DOD to revise its Supplement to the
Federal Acquisition Regulation to:
40

After the final version of H.R. 1540 was cleared for the President’s signature, DOD reportedly terminated the ALTB
program. See Amy Butler, “Grounded: Airborne Laser No More,” ARES, December 21, 2011, accessed at
http://www.aviationweek.com/aw/blogs/defense/index.jsp?plckController=Blog&plckBlogPage=BlogViewPost&news
paperUserId=27ec4a53-dcc8-42d0-bd3a-01329aef79a7&plckPostId=Blog%3a27ec4a53-dcc8-42d0-bd3a01329aef79a7Post%3a2cce307f-7e3e-4d24-978c-f7d2adc09212&plckScript=blogScript&plckElementId=blogDest.
41
The section was written by (name redacted), Specialist in Defense Acquisition, Congressional Research Service.

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•

hold prime contractors responsible for detecting and avoiding the inclusion of
counterfeit electronic parts in items acquired by the DOD; and

•

require contractors to bear the cost of any rework that necessary to remove
suspected counterfeit parts.

The provision also requires contractors to establish internal processes for detecting counterfeit
parts. Such contractor processes are subject to approval by DOD and, if disapproved, could result
in the withholding of payments to the contractor.

Small Business Innovation42
The final version of H.R. 1540 includes a modified version of a section of the Senate bill that
reauthorizes the Small Business Innovation Research (SBIR) and Small Business Technology
Transfer (STTR) programs.
The Small Business Innovation Development Act of 1982, P.L. 97-219, created Small Business
Innovation Research (SBIR) programs within the major federal research and development (R&D)
agencies. This effort was intended to increase participation of small innovative companies in
federally funded R&D. Government agencies with budgets of $100 million or more to support
R&D work by non-federal entities are required to set aside a portion of these funds to support
research and development in small firms through the SBIR program.
In general, Division E of H.R. 1540, as agreed to in conference, reauthorizes the SBIR through
September 30, 2017; incrementally expands the set-aside to 3.2% by FY2017 and beyond;
increases the amount of Phase I and Phase II awards; allows NIH, DOE, and NSF to award up to
25% of SBIR funds to small businesses that are majority-owned by venture capital companies,
hedge funds, or private equity firms and other agencies to award up to 15% of SBIR funds to such
firms; creates commercialization pilot programs; and expands oversight activities, among other
things.
STTR, modeled after SBIR, was established by the Small Business Technology Transfer Act of
1992 (P.L. 102-564, Title II) as a pilot program to foster the commercialization through small
businesses of technologies developed by non-profit research institutions. Government agencies
with R&D budgets of $1 billion or more are required to set aside a portion of these funds to
finance the STTR activity. In addition to reauthorizing STTR through 2017, H.R. 1540 would
gradually increase the set-aside for this program to 0.6% of an agency’s R&D funding by FY2017
and beyond.
The corresponding sections of the Senate bill would have reauthorized the two programs for
longer periods over the course of which the set-asides would increase to higher levels.
Detailed Analysis of SBIR and STTR Reauthorization
For additional background on SBIR and STTR and a more detailed analysis of the reauthorization of these programs,
see CRS Report 96-402, Small Business Innovation Research (SBIR) Program, by (name redacted), and CRS Report
RS22865, The Small Business Innovation Research (SBIR) Program: Reauthorization Efforts, by (name redacted).

42

This section was written by (name redacted), Specialist in Science and Technology Policy, Congressional
Research Service.

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Ground Combat Systems
M-1 Tanks and Bradley Troop Carriers
The House and Senate Armed Services Committees both challenged DOD’s plan to shut down—
for at least a couple of years—the assembly facilities that originally manufactured new M-1 tanks
and, for more than a decade, have rebuilt existing tanks with improved communications
equipment and sensors. As a cost-saving measure, DOD plans to shut down the line in FY2013
and then to restart them for a new tank modification in FY2016. (See Table A-3 for authorization
action on selected ground combat systems.)
The committees objected that closing the lines and then reopening them could cost more than
continuing to operate them at a low rate, partly because some component suppliers and assemblyline technicians familiar with these programs could move on to other work, forcing the prime
contractors to train new suppliers and workers before they could resume production. Accordingly,
the House bill would have authorized an additional $272 million and the Senate version an
additional $240 million to sustain the Abrams production line.43 The conference report authorizes
an additional $255 million intended to bridge the planned gap in the production line.
The budget request assumed a similar hiatus in the production line that upgrades Bradley armored
troop carriers, and the House committee challenged that decision for the same reasons it objected
to the tank plan. For that reason, the House version of the authorization bill also would have
added to the budget request $153 million to continue Bradley upgrades. Neither the Senate bill
nor the final version of H.R. 1540 authorized any increase for Bradley upgrades.

Ground Combat Vehicle (GCV)
The House and Senate bills both approved the request for $884 million to continue development
of a new armored troop carrier for the Army designated the Ground Combat Vehicle (GCV).
However, the House committee added to H.R. 1540 a provision (Section 211) that would have
barred the use of 30% of those funds until the Army provides Congress with a report comparing
the proposed new vehicle with alternatives, including the most recently upgraded version of the
Bradley troop carrier.
The committee continues to support the Army’s goal of pursuing a modernized combat
vehicle. However, before the Army starts another major development program that could
cost over $30.0 billion, the committee must be convinced that the GCV will be significantly
more capable than an upgraded version of current fielded platforms.44

The House committee noted that the Army wants a troop carrier that could carry three more
soldiers than the six carried by the Bradley (in addition to a vehicle crew of three), but said that
should not be “the primary attribute” that determines whether to proceed with a new vehicle.

43

The original Senate Armed Services Committee bill, S. 1253, would have authorized an additional $322 million for
Abrams upgrades.
44
H.Rept. 112-78, p. 88. For background, see CRS Report R41597, The Army’s Ground Combat Vehicle (GCV)
Program: Background and Issues for Congress, by (name redacted).

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The final version of H.R. 1540 authorizes $449 million for the new troop carrier—slightly more
than half the amount requested. The bill also included a provision (Section 211) barring the
expenditure of more than 80% of the authorized amount until the congressional defense
committees receive a report comparing the planned new vehicle with various alternatives,
including improved versions of vehicles already in service. In their report on the bill, the
conferees reiterated the House committee’s demand for “assurances that the GCV will be
significantly more capable than a potentially less expensive, upgraded version of currently fielded
platforms.”45

Expeditionary Fighting Vehicle (EFV)
The House and Senate Armed Services Committees both objected to DOD’s stated rationale for
cancelling development of the Expeditionary Fighting Vehicle (EFV), an amphibious armored
troop carrier intended to replace the Marine Corps’s current amphibious tractor, designated the
AAV-7, which dates from the early 1970s. Former Defense Secretary Robert Gates had cited as
grounds for the cancellation EFV’s cost and technical complexity, much of which was due to the
design goal of enabling the new vehicle to carry Marines ashore at speeds of nearly 30 mph—
about four times the speed of its predecessor. The speed specification—which required the EFV
to “plane” over the surface of the water like a speedboat—had been justified by the argument
that, in future conflicts, transport ships would have to launch the troop carriers from 25 miles
offshore (to avoid enemy defenses) and Marines would lose their fighting edge if they were
cooped up inside their troop carriers for more than an hour.46
In drawing up the specifications for a cheaper substitute for EFV, designated the Armored
Combat Vehicle (ACV), the Marines have assumed that a troop carrier with more ergonomically
sound seating and environmental control would allow troops to tolerate a longer ride to the beach.
Moreover, the Navy now assumes that it can protect ships closer to shore than 25 miles. In
combination, those assumptions allow the Marines to require that the ACV plow though the water
at about 12 miles per hour, allowing a simpler (and thus cheaper) design. The Marines also plan
to acquire a heavily armored, non-amphibious armored troop carrier called the Marine Personnel
Carrier (MPC).

House-passed Bill
The House bill would have authorized the amounts requested to upgrade the amphibious troop
carriers currently in service and slightly increase their speed ($60.8 million) and to develop both
the new amphibious ACV ($12.0 million)—which would be designed to travel at about half the
speed for which the EFV had been designed—and the non-amphibious MPC ($34.9 million).
In its report on the bill, the House Armed Services Committee said DOD had provided no
explanation for its decision to reduce the speed requirement for the new troop carrier. It added to
the House bill a provision (Section 214) barring the use of any funds authorized by the bill to
work on either improvements to the existing AAV-7 or development of the new ACV until the
Secretary of the Navy submits to the committee a written certification of the Marines’
45

Ibid.
For background, see CRS Report RS22947, The Marines’ Expeditionary Fighting Vehicle (EFV): Background and
Issues for Congress, by (name redacted).
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requirements, including the distance offshore from which an amphibious assault would be
launched and the speed at which an amphibious troop carrier should be able to travel. The Navy
Secretary also would have been required to submit an analysis of alternative vehicles the Marines
might acquire, including an improved version of the AAV-7, the cancelled EFV, and the
proposed new, slower ACV.

Senate-passed Bill
The Senate version H.R. 1540 would have cut $25 million from the total of $95.7 million
requested to (1) develop improvements to the existing AAV-7 and (2) develop the nonamphibious MPC. In its report, the Senate Armed Services Committee expressed dissatisfaction
with the Marine Corps’ plan to develop both the amphibious ACV and the non-amphibious MPC
in wake of the EFV cancellation. The committee also added to the bill a provision (Section 241)
that would have slowed the Marines’ timetable by requiring:
•

A thorough analysis of alternatives before proceeding with the new amphibious
vehicle (the ACV); and

•

An assessment by DOD of the life-cycle cost of the Marines entire planned fleet
of combat vehicles.

The committee insisted that the Navy and Marine Corps substantiate—by tests and exercises, if
possible—the more sanguine assumptions that undergird the less demanding speed requirement
for the ACV. The panel also said that, since the ACV was designed to plow through the water
rather than skim over it, it could be more heavily armored than the EFV and, thus, might obviate
the need for a separate fleet of non-amphibious, armored troop carriers (MPCs).

Conference Report
The final version of the bill—like the Senate version—authorizes $12.0 million, as requested for
the proposed EFV replacement (the ACV) and $70.7 million of the $90.7 million requested to
develop upgrades for the AAV-7 and to develop the MPC. A provision of the bill (Section 214)
allows DOD to proceed immediately to:
•

develop improvements for the existing AAV-7,

•

refine the specifications for the proposed ACV, and

•

conduct a comparison of the ACV with certain alternative vehicles, including the
EFV and a modified version of the AAV-7.

However, the provision bars any other amphibious vehicle development work until the Marine
Corps sends Congress a report on regional commanders’ views about how far offshore the ships
carrying a Marine landing force should remain and how quickly their amphibious vehicles should
get them from ship to shore.

Shipbuilding
The final version of H.R. 1540 authorizes funds to build 12 ships, as requested (as both the House
and Senate versions of the bill would have done). The ships for which most of the total cost is
authorized in FY2012 include two Virginia-class submarines, a destroyer equipped with the Aegis

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anti-missile system, four Littoral Combat Ships (LCSs), a transport for amphibious landing
troops, two high-speed cargo s

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/crs%3AR41861. Public record. Not legal advice.