# Defense: FY2009 Authorization and Appropriations > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/crs%3ARL34473 ## Record - **Collection:** Congressional research report - **Document type:** CRS Report - **Published:** February 25, 2009 - **Citation:** RL34473 ## Text Defense: FY2009 Authorization and Appropriations (name redacted) Specialist in U.S. Defense Policy and Budget (name redacted) Specialist in Defense Policy and Budgets (name redacted) Specialist in U.S. Defense Policy and Budget February 25, 2009 Congressional Research Service 7-.... www.crs.gov RL34473 CRS Report for Congress Prepared for Members and Committees of Congress Defense: FY2009 Authorization and Appropriations Summary Soon after the 111th Congress convened, it began drafting H.R. 1, the American Recovery and Reinvestment Act of 2009, generally referred to as the “economic stimulus” bill. This bill added a total of $8.5 billion to amount previously appropriated for DOD in FY2009. Of the additional funds provided by H.R. 1, $4.6 billion was for accounts funded by the regular FY2009 DOD appropriations provided by Division D of the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act for FY2009, generally referred to as the “continuing resolution,” which President George W. Bush signed into law on Sept. 30, 2008. The economic stimulus bill also provided an additional $2.9 billion for accounts funded by the regular military construction appropriations provided by Division E of the continuing resolution. Congress’ disposition of FY2009 funding for DOD in H.R. 1 (other than funding for military construction) is discussed in this report on pp. 3-5, below. The balance of the report discusses the President’s regular DOD budget request for FY2009 and Congress’ disposition of that request in the regular defense authorization and appropriations legislation. The President’s FY2009 budget request, released February 4, 2008, included $611.1 billion in new budget authority for national defense. This total included $515.4 billion in discretionary budget authority for the base budget of the Department of Defense (DOD)—i.e., activities not associated with operations in Iraq and Afghanistan—$2.9 billion in mandatory spending for the DOD base budget, and $22.8 billion for defense costs of the Department of Energy and other agencies. It also included a placeholder of $70 billion for war costs in the first part of FY2009. On April 30, the Senate Armed Services Committee marked up its version of the FY2009 defense authorization bill (S. 3001), authorizing the appropriation of $612.5 billion in new budget authority, including $542.5 billion for the baseline budget and a $70 billion allowance for warrelated costs. On September 17, the Senate passed the authorization bill by a vote of 88-8. The House passed its version of the defense authorization bill (H.R. 5658) on May 22, authorizing $612.5 billion for national defense, including $70 billion for war-related costs. The bill denied authorization of the $2.5 billion requested for a third destroyer of the DDG-1000 class, allocating those funds instead to buy several other ships. A compromise between the House and Senate bills authorizing $611.1 billion, worked out informally, was passed by the House September 24 as an amended version of the Senate-passed S. 3001 by a vote of 392-39. The Senate passed the bill September 27 by voice vote and the President signed it on October 14 (P.L. 110-417). The House Defense Appropriations Subcommittee marked up its version of the FY2009 Defense Appropriations Bill on July 30, recommending a total of $477.6 billion, $4 billion less than the President requested for that bill. The Senate Defense Appropriations Subcommittee marked up its version of the appropriations bill on September 10, also recommending $477.6 billion. Neither chamber held full committee markups of a FY2009 defense appropriations bill, and neither chamber considered a bill on the floor. Instead, a compromise version of the subcommittee bills was incorporated into H.R. 2638, the FY2009 Consolidated Security, Disaster Assistance and Continuing Appropriations Act. The bill included $477.6 billion in regular FY2009 defense appropriations and $25.0 billion in military construction appropriations. The House passed the compromise bill September 24 (370-58). The Senate passed the bill September 27 (78-12), and the President signed it September 30 (P.L. 110-329). Congressional Research Service Defense: FY2009 Authorization and Appropriations Contents Most Recent Developments.........................................................................................................1 Economic Stimulus Funding, DOD .............................................................................................4 Overview of the Administration FY2009 Request........................................................................5 Comparison and Context .......................................................................................................6 Status of Legislation....................................................................................................................7 Is the Budget Too Small? The 4% of GDP Debate .......................................................................8 Potential Issues in the FY2009 Base Budget Request................................................................. 12 Military Pay Raise .............................................................................................................. 12 Army and Marine Corps End-Strength Increases ................................................................. 12 TRICARE Fees and Co-pays............................................................................................... 13 Projected Navy Strike Fighter Shortfall ............................................................................... 13 LPD-17-Class Ship Procurement ......................................................................................... 14 Funding for DDG-1000 Destroyers versus Other Ships........................................................ 14 Littoral Combat Ship Funding ............................................................................................. 14 CG-X Design ...................................................................................................................... 14 Reliable Replacement Warhead ........................................................................................... 15 Missile Defense .................................................................................................................. 15 Long-Range Non-Nuclear Prompt Global Strike.................................................................. 15 Future Combat Systems ...................................................................................................... 16 F-35 Joint Strike Fighter Alternate Engine........................................................................... 16 F-22 Fighter ........................................................................................................................ 16 Mid-Air Refueling Tanker ................................................................................................... 17 C-17 Cargo Jet .................................................................................................................... 17 “Soft” Power Functions and Interagency Burden-Sharing.................................................... 18 War Funding Issues in the FY2009 DOD Bridge Fund.............................................................. 19 FY2009 War Costs .............................................................................................................. 20 FY2009 Bridge Fund .................................................................................................... 21 Resolution of Issues ............................................................................................................ 22 Funding for Iraq Security Forces (ISFF)........................................................................ 26 Strict Monitoring of Joint Improvised Explosive Device Defeat Fund (JIEDDO) ........... 26 Commanders Emergency Response Program Funding ................................................... 26 Section 1206 Training and Equipping of Foreign Military Forces .................................. 27 MRAP Vehicle Funding ................................................................................................ 28 Separating Iraq and Afghanistan Funding ...................................................................... 28 Caps on Transfers.......................................................................................................... 28 Bill-by-Bill Synopsis of Congressional Action to Date ............................................................. 29 Congressional Budget Resolution........................................................................................ 29 FY2009 Defense Authorization: Highlights of the House Bill.............................................. 29 Pay Raise, Tricare, and Other Personnel Issues .............................................................. 30 Tanker, Cargo, and Patrol Planes ................................................................................... 31 Fighter Planes ............................................................................................................... 31 Future Combat Systems (FCS) ...................................................................................... 32 Anti-Missile Defense .................................................................................................... 32 Shipbuilding ................................................................................................................. 33 Congressional Research Service Defense: FY2009 Authorization and Appropriations Civilian Response Corps ............................................................................................... 34 Iraq Policy Provisions ................................................................................................... 34 Other Highlights ........................................................................................................... 35 Defense Authorization: Highlights of House Floor Action ................................................... 36 Agreements with Iraq.................................................................................................... 36 Long-term Cost of Operations in Iraq............................................................................ 36 Detainee Interrogations ................................................................................................. 36 Intelligence on Iran ....................................................................................................... 36 Contracting Regulations ................................................................................................ 36 FY2009 Defense Authorization: Highlights of the Senate Bill ............................................. 37 End-Strength, Tricare, and Other Personnel Issues......................................................... 38 Shipbuilding ................................................................................................................. 38 Fighter Aircraft ............................................................................................................. 39 UAVs and Surveillance Planes ...................................................................................... 40 Helicopters.................................................................................................................... 40 Anti-Missile Defenses ................................................................................................... 40 Other Highlights ........................................................................................................... 41 Highlights of the Final Version of the FY2009 Defense Authorization Bill (S. 3001) ........... 42 Veto Threats Avoided .................................................................................................... 42 Weapons Program Issues............................................................................................... 43 Missile Defense Program Issues .................................................................................... 44 Military Personnel Issues .............................................................................................. 45 Health Care................................................................................................................... 45 Acquisition Policy......................................................................................................... 45 Comparison of Iraq-Related Policy Provisions in House and Senate Versions of the FY2009 Defense Authorization Bill.................................................................................. 46 FY2009 Defense Appropriations Bill: House and Senate Defense Appropriations Subcommittee Markups.................................................................................................... 52 House Defense Appropriations Subcommittee Markup .................................................. 52 Senate Defense Appropriations Markup......................................................................... 54 Tables Table 1. FY2008-09 DOD Appropriations Through December 31, 2008 .....................................3 Table 2. American Recovery and Reinvestment Act for 2009 (H.R. 1) .........................................4 Table 3. Department of Defense Baseline Budget Request Discretionary Budget Authority, FY2008-FY2009 .....................................................................................................7 Table 4. Status of FY2009 Defense Authorization, S. 3001 ..........................................................7 Table 5. Status of FY2009 Defense Appropriations, H.R. 2638, Division C................................8 Table 6. DOD Budget Authority, FY1998-FY2013 ......................................................................9 Table 7. FY2009 War Bridge Funding ....................................................................................... 24 Table 8. Side-By-Side Comparison of Selected Iraq Policy Provisions in House, Senate, and Final Defense Authorization Bills .................................................................................... 47 Table A-1. FY2009 National Defense Authorization Act: House and Senate Action by Title ....................................................................................................................................... 58 Congressional Research Service Defense: FY2009 Authorization and Appropriations Table A-2. FY2009 Defense and Military Construction Appropriations: Request and Final Bill Amounts by Title .................................................................................................... 59 Table A-3. FY2009 Missile Defense Funding: Authorization ..................................................... 61 Table A-4. FY2009 Missile Defense Funding: Appropriations ................................................... 65 Table A-5. Congressional Action on Selected FY2009 Army and Marine Corps Programs: Authorization......................................................................................................................... 68 Table A-6. Congressional Action on Selected FY2009 Army and Marine Corps Programs: Appropriations ....................................................................................................................... 71 Table A-7. Congressional Action on Selected FY2009 Shipbuilding Programs: Authorization......................................................................................................................... 74 Table A-8. Congressional Action on Selected FY2009 Shipbuilding Programs: Appropriations ....................................................................................................................... 77 Table A-9. Congressional Action on Selected FY2009 Aircraft Programs: Authorization............ 79 Table A-10. Congressional Action on Selected FY2009 Aircraft Programs: Appropriations........ 82 Table A-11. Congressional Action on Selected FY2009 Missile, Space, Munitions, and Strategic Programs: Authorization .......................................................................................... 85 Table A-12. Congressional Action on Selected FY2009 Missile, Space, Munitions, and Strategic Programs: Appropriations ........................................................................................ 87 Appendixes Appendix. Highlights of Compromise Final Version of FY2009 Defense Appropriations in the FY2009 Consolidated Security, Disaster Assistance and Continuing Appropriations Act (H.R. 2638) ............................................................................................. 55 Contacts Author Contact Information ...................................................................................................... 89 Key Policy Staff........................................................................................................................ 89 Congressional Research Service Defense: FY2009 Authorization and Appropriations Most Recent Developments Soon after the 111th Congress convened, it began drafting H.R. 1, the American Recovery and Reinvestment Act of 2009, generally referred to as the “economic stimulus” bill. On January 28, the House passed a version of the bill which would have provided, in Title III, $4.9 billion for accounts funded by the regular FY2009 DOD appropriations provided by Division D of the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act for FY2009, generally referred to as the “continuing resolution,” which President George W. Bush signed into law on September 30, 2008. The House version of the economic stimulus bill also provided in Title X of the economic stimulus bill $6.0 billion for accounts funded by the regular military construction appropriations provided by Division E of the continuing resolution. The Senate passed an amended version of H.R. 1 on February 10, which would have provided an additional $3.7 billion for DOD accounts other than military construction in FY2009 and 3.4 billion for military construction. House-Senate conferees on the economic stimulus bill agreed February 10 on a compromise version that added $4.6 billion to the non-construction DOD accounts and funded by the FY2009 Defense Appropriations Act and $2.9 billion for military construction accounts(see Table 1). The House and Senate each adopted the conference report on H.R. 1 on February 13, 2009, with the House approving it by a vote of 246-183 and the Senate approving it by a vote of 60-38. Provisions of H.R. 1 relevant to accounts funded in the FY2009 defense appropriations bill are analyzed in pp, 3-5, below. (Provisions of the economic stimulus relevant to military construction accounts are analyzed in CRS Report RL34558, Military Construction, Veterans Affairs, and Related Agencies: FY2009 Appropriations, by (name redacted), (name redacted), and (name redacted) .) The balance of this report analyzes the FY2009 defense appropriations bill that was incorporated into the FY2009 Consolidated Security, Disaster Assistance and Continuing Appropriations Act (P.L. 110-329), which the President signed September 30, 2008. That bill provided $477.6 billion in discretionary defense appropriations for the so-called “base budget” of the Department of Defense, that is, for regular operations other than combat operations in Iraq and Afghanistan. The House Defense Appropriations Subcommittee had marked up its version of the FY2009 Defense Appropriations Bill on July 30, recommending a total of $477.6 billion, which the panel said was $4 billion less than the President requested for that bill. The Senate Defense Appropriations Subcommittee marked up its version of the appropriations Bill on September 10, also recommending $477.6 billion. Neither chamber held full committee markups of a FY2009 defense appropriations bill, and neither chamber considered a defense appropriations bill on the floor. Instead, a compromise version of the two subcommittee bills—in effect, a conference agreement on FY2009 defense appropriations—was negotiated informally by members of the House and Senate Appropriations committees and was incorporated into the FY2009 continuing resolution, along with full-year versions of the FY2009 homeland security and military construction/veterans affairs appropriations bills. The bill was passed by the House September 24, 2008 and by the Senate September 27, 2008 and was signed by the President September 30 (See Table A-2 in the Appendix to this report.). Congressional Research Service 1 Defense: FY2009 Authorization and Appropriations Together with defense funds appropriated in other acts for military construction and emergency war costs and the permanent appropriation for accrual payments to the Tricare for Life fund for military retirees, the defense appropriations act brought the total for DOD appropriations in FY2009 to $578.9 billion, as of December 31, 2008 (see Table 1). In a related action, the President signed into law on October 14, 2008 the FY2009 defense authorization bill (S. 3001) authorizing $611.1 billion for national defense, including $68.6 billion for war-related programs (see Table A-1 in the Appendix to this report). The House had passed its version of the FY2009 defense authorization bill (H.R. 5658) on May 22, 2008, by a vote of 384-23. The House version of the bill authorized $612.4 billion, including $542.4 billion for national defense-related activities of DOD and other federal agencies and an additional $70 billion for costs related to military operations in Iraq and Afghanistan. On April 30, the Senate Armed Services Committee marked up its version of the FY2009 authorization bill, which it reported to the floor on May 12 as S. 3001. It also authorized the appropriation of $612.5 billion in new budget authority for national security programs, including $542.5 billion for the base budget and an additional $70 billion allowance for war-related costs. Controversies over various issues—including a provision that would incorporate into the legislation hundreds of earmarks listed in the committee’s report on the bill and an unrelated dispute over offshore oil drilling—delayed Senate action on the measure until September 8. Because of the controversy over the earmarks provision, the Senate acted on only four of the several dozen amendments to the bill that were proposed before it passed the bill on September 17, 2008 by a vote of 88-8. Another result of the earmark dispute was that the Senate did not request a conference with the House to reconcile the two versions of the defense bill. Instead, members of the House and Senate Armed Services committees negotiated informally a final version of the bill authorizing $611.1 billion, a reduction of $1.4 billion from the Administration’s request as re-estimated by the Congressional Budget Office. All but a very small amount of the authorization bill’s reduction was taken from the $70 billion requested for military operations in Iraq and Afghanistan. On September 24, the House passed the compromise version of the authorization bill as an amended version of the Senate-passed S. 3001. The bill was passed by a vote of 392-39 under suspension of the rules, a procedure which did not permit amendments but which required approval by a two-thirds vote. The Senate passed the amended version of S. 3001 by voice vote on September 27, thus clearing the measure for the President who signed it on October 14, 2008. Since neither the defense authorization bill nor the defense appropriations bill was the result of a formal conference committee, neither was accompanied by a traditional conference report. However, explanatory statements associated with the compromise version of each measure, fleshing out the details of the final legislation, were published in the Congressional Record.1 1 The explanatory statement to accompany the defense authorization bill, S. 3001, was published in the Congressional Record of September 23, 2008 (pp. H8718-H9081). Subsequently, the text of the bill and the explanatory statement were published as a House Armed Services Committee print (HASC No. 10 ). The explanatory statement to accompany the DOD-related section of the continuing resolution was published in the Congressional Record of September 24 (pp. H9434-H9870). Subsequently, the text of the continuing resolution (Division C of which is the FY2009 defense appropriations bill) and the explanatory statement were printed by the House Appropriations Committee as an (continued...) Congressional Research Service 2 Defense: FY2009 Authorization and Appropriations Table 1. FY2008-09 DOD Appropriations Through December 31, 2008 (amounts in billions of dollars) FY2008 Enacted FY2009 Request FY2009 Enacted Military Personnel 105.3 114.9 114.4 Operation and Maintenance 140.1 154.8 152.9 Procurement 98.2 102.1 101.1 RDT&E 77.3 79.6 80.5 Revolving and Management Funds 2.7 3.5 3.2 Other Defense Programs: 26.3 26.9 27.4 Related Agencies 1.0 1.0 1.0 General Provisions/Rescissions (non-emergency) -2.2 -1.2 -2.9 Total, DOD Appropriations Act (non-emergency) 448.7 481.6 477.6 Mine-Resistant, Armor-Protected Vehicles (MRAP) (emergency) 11.6 — — Total, Annual DOD Appropriations Act 460.3 481.6 477.6 Tricare for Life Accrual (permanent appropriation) 10.9 10.4 10.4 Other Emergency Appropriations (Bridge Fund) 171.1a 66.1 65.9b Annual Military Construction Appropriations Act 24.9 24.4 25.0 “Stimulus Package” funds for accounts covered by Annual DOD Appropriations Act n/a n/a 4.6 “Stimulus Package” funds for DOD accounts covered by Annual Military Construction Appropriations Act n/a n/a 2.9 Total Defense and Mil/Con Appropriations 667.2 582.5 586.4 Annual DOD Appropriations Bill Source: CRS from based on Congressional Record, September 24, 2008, Part I, pp. H9291-H9294. Notes: Totals may not add due to rounding. Does not include funds appropriated for these accounts by the American Recovery and Reinvestment Act of 2009 (the “economic stimulus” bill). a. Includes emergency war funding provided in three acts: P.L. 110-92 (First Continuing Resolution, FY2008); P.L. 110-161 (Emergency Supplemental Appropriations Act for Defense, FY2008); and P.L. 110-252 (Supplemental Appropriations Act, FY2008). Also includes approximately $5.7 billion for non-war emergency DOD funding. b. Emergency war funding (or “bridge fund”) provided in P.L. 110-252 (Supplemental Appropriations Act, FY2008). (...continued) unnumbered committee print. Congressional Research Service 3 Defense: FY2009 Authorization and Appropriations Economic Stimulus Funding, DOD H.R. 1, the American Recovery and Reinvestment Act of 2009, also known as the “economic stimulus,” added $4.6 billion to DOD accounts funded in the regular FY2009 defense appropriations bill enacted September 30, 2008 as Division D of the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act for FY2009. The additional DOD funds provided by the economic stimulus bill were aimed largely at programs that would serve one of two goals. A total of $4.24 billion was for maintenance of DOD facilities of which $400 million is for medical facilities, $153.5 million is for renovation of barracks, and the remaining $3.69 billion is for repair and maintenance of other facilities and for projects that would improve the energy efficiency of DOD facilities. An additional $300 million is for research and development projects that would improve DOD’s energy efficiency. Representative David R. Obey, chair of the House Committee on Appropriations, introduced the bill on January 26, 2009, three weeks after the 111th Congress convened. Following referral to the Committees on Appropriations and Budget, the bill was brought up for consideration on the floor on January 27 (Congressional Record, pp. H557-H583, H620-H749). After debate and amendment, H.R. 1 was passed by the Yeas and Nays, 244-188 (Roll no. 46). As passed by the House, the bill would have added $4.9 billion to the DOD accounts funded by the regular FY2009 Defense Appropriations Act that comprised Division D of the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act for FY2009. (see Table 2) The Senate received the economic stimulus bill on January 29. It was laid before the Senate by Unanimous Consent on February 2, when Sen. Harry Reid, the Majority Leader, proposed on behalf of Sen. Daniel K. Inouye, chair of the Senate Committee on Appropriations, to amend H.R. 1 by substituting the text of S. 336, the chamber’s own version of the bill (Congressional Record S 1237-S1243, S1266-S1273). The Senate adopted several floor amendments before passing the bill Feb. 10 by a vote of 61-37. As passed by the Senate, the bill would have added $3.7 billion to the accounts funded by the regular FY2009 DOD appropriations act. (see Table 2) A conference report on the economic stimulus bill, adopted by both the House and the Senate on February 13, 2009 increased accounts funded by the regular FY2009 DOD appropriations bill by a total of $4.6 billion. President Obama signed the bill into law on February 17, 2009. (see Table 2) Table 2. American Recovery and Reinvestment Act for 2009 (H.R. 1) (budget authority in $ millions) Account House Senate Enacted Operations and Maintenance, Army 1,490.8 1,169.3 1,474.5 Operations and Maintenance, Navy 624.4 571.8 657.1 Operations and Maintenance, Marine Corps 128.5 112.2 113.9 Operations and Maintenance, Air Force 1,236.8 927.1 1,096.0 Operations and Maintenance, Army Reserve 110.9 79.5 98.3 Operations and Maintenance, Navy Reserve 62.2 44.6 55.1 Operations and Maintenance, Marine Corps Reserve 45.0 32.3 39.9 Congressional Research Service 4 Defense: FY2009 Authorization and Appropriations Account House Senate Enacted Operations and Maintenance, Air Force Reserve 14.9 10.6 13.2 Operations and Maintenance, Army National Guard 302.7 215.6 266.3 Operations and Maintenance, Air National Guard 29.2 20.9 25.8 Total, Facility Infrastructure Investments 4,045.3 3,184.0 3840.0 Defense Production Act Purchases 0 100.0 0 Research, Development, Test and Evaluation, Army 87.5 0 75.0 Research, Development, Test and Evaluation, Navy 87.5 0 75.0 Research, Development, Test and Evaluation, Air Force 87.5 0 75.0 Research, Development, Test and Evaluation, Defense-wide 87.5 200.0 75.0 Total, Energy Research and Development 350.0 200.0 300.0 Defense Health Program 454.7 250.0 400.0 Office of the Inspector General 15.0 15.0 15.0 4,865.0 3,749.0 4,555.0 Grand Total, DOD Programs Source: American Recovery and Reinvestment Act for 2009 (P.L. 111-5) Note: This table includes only funds for DOD accounts usually funded in the annual DOD appropriations bill. Overview of the Administration FY2009 Request On February 4, 2008, the Administration released its federal budget request for FY2009 which included $606.8 billion in discretionary budget authority for national defense. 2 This included $515.4 billion for the so-called base budget of the Department of Defense (DOD)—the cost of routine activities excluding U.S. operations in Iraq and Afghanistan. It also included a lump-sum request for $70 billion to cover war costs in the first part of the year.3 For congressional action on the Administration’s funding request for war costs, see CRS Report RL34451, FY2008 Spring Supplemental Appropriations and FY2009 Bridge Appropriations for Military Operations, International Affairs, and Other Purposes (P.L. 110-252), by (name re dacted) et al. For policy issues raised by that request, see CRS Report RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11, by (name redacted). 2 The budget request included an additional $4.3 billion in mandatory spending for the national defense function of the budget (Function 050). 3 On May 2, the White House sent Congress an amendment to its FY2009 budget providing some detail as to how it would allocate the $70 billion, which included $66 billion for the Department of Defense and $4 billion for international affairs programs. Congressional Research Service 5 Defense: FY2009 Authorization and Appropriations The total national defense request also included $16.1 billion for nuclear weapons and other defense-related programs of the Department of Energy and $5.2 billion for the defense-related activities of other agencies. Because it did not submit a request for funds to cover the full anticipated costs of operations associated with Iraq and Afghanistan, the Administration was not in compliance with a provision of the FY2007 John Warner National Defense Authorization Act (P.L. 109-364, Section 1008) which requires the President to include in future annual budget requests funds to cover the anticipated cost of operations in Iraq and Afghanistan. Last year, the Administration’s DOD budget request for FY2008 included a request for $141.7 billion (subsequently increased to $189.3 billion) to cover anticipated war costs for the entire fiscal year. When the FY2009 defense request was submitted in February 2008, administration officials contended that there was too much uncertainty about future troop levels in Iraq to enable them to provide a funding request for war costs for the entire year. Pressed by Senate Armed Services Committee Chairman Carl Levin during a February 5 hearing to provide an estimate of war costs for all of FY2009, Defense Secretary Robert M. Gates observed that a simple extrapolation of the FY2008 costs would amount to $170 billion, but he added that he had no confidence in that projection because of the uncertainties concerning U.S. combat operations. On May 2, 2008, the Administration submitted an amended budget request that specified funding levels by account in the FY2009 war costs bridge fund, including a total of $66 billion for DOD and $4 billion for foreign aid. Congress incorporated action on the FY2009 war costs request into H.R. 2642 (P.L. 110-252), a bill making supplemental appropriations for FY2008 and FY2009 for military operations in Iraq and Afghanistan and for other purposes. On June 30, President Bush signed the bill providing $96.1 billion for military operations in Iraq, Afghanistan and elsewhere in FY2008 and $65.9 billion for those purposes in FY2009. Comparison and Context The President’s $515.4 billion request for DOD’s FY2009 base budget is $35.9 billion more than Congress appropriated for the FY2008 base budget, a nominal increase of 7.5 %. Adjusting for the cost of inflation, the FY2009 request would provide a real increase of 5.4 %. Roughly twothirds of the proposed increase would go to the accounts that pay for current operations: funding for military personnel would increase by $8.8 billion over the FY2008 appropriation, to $125.2 billion; operations and maintenance funding would increase by $15.6 billion, to $179.8 billion (see Table 3). The FY2009 base budget request is $3.3 billion larger than the base budget request for that year the Administration had projected in February 2007. However, compared with the earlier projection, the actual request for procurement was lower by $6.3 billion and the military construction request was lower by $2.7 billion. On the other hand, the operations and maintenance request was $5.4 billion higher and the R&D request $2.4 billion higher than had been forecast in February 2007. Congressional Research Service 6 Defense: FY2009 Authorization and Appropriations Table 3. Department of Defense Baseline Budget Request Discretionary Budget Authority, FY2008-FY2009 (amounts in billions of dollars) FY2008 Enacted (Excluding War Funds) FY2009 Request (Excluding War Funds) Change Military Personnel 116,478 125,247 +8,769 Operation and Maintenance 164,187 179,787 +15,600 Procurement 98,986 104,216 +5,231 Research, Development, Test, & Evaluation 76,536 79,616 +3,080 Military Construction 17,763 21,197 +3,434 Family Housing 2,867 3,204 +337 Revolving & Management Funds 2,692 2,174 -518 479,508 515,440 +35,932 Total DOD Source: Department of Defense, Fiscal Year 2009 Budget Request: Summary Justification, February 2008. Status of Legislation Congress began action on the annual defense authorization bill with the Senate Armed Services Committee approving its version (S. 3001) on April 30 and the Senate passing it September 17. The House Armed Services Committee marked up its version of the bill (H.R. 5658) on May 14 and passed the bill May 22. Instead of convening a House-Senate conference committee to reconcile the two versions of the bill, House and Senate negotiators worked out a compromise version, which the House passed September 24 as an amended version of the Senate-passed bill. The Senate passed the compromise version September 27 and the President signed in October 14 (P.L. 110-417). Table 4. Status of FY2009 Defense Authorization, S. 3001 Full Committee Markup House Senate 5/14/08 4/30/08 House Report House Passage Senate Report Senate Passage Conf. Report H.Rept. 110-652 5/22/08 384-23 S.Rept. 110-335 9/17/08 88-8 Cong. Record pp. H 8718H9081 Conference Report Approval House Senate Public Law 392-39 9/24/08 9/27/08 voice vote P.L. 110417 10/14/08 The House Defense Appropriations Subcommittee marked up an unnumbered version of the FY2009 defense appropriations bill on July 30. The Senate Defense Appropriations Subcommittee marked up its own unnumbered bill on September 10. But in neither chamber did the full Appropriations Committee markup the bills drafted by the two defense subcommittee. Nor was a defense appropriations bill brought to the floor of either the House or Senate. Instead, House and Senate negotiators worked out a compromise version which was incorporated into the FY2009 Consolidated Security, Disaster Assistance and Continuing Appropriations Act (H.R. Congressional Research Service 7 Defense: FY2009 Authorization and Appropriations 2638) which included the compromise defense appropriations bill as Division C. The House passed that bill on September 24. The Senate passed it September 27 and the President signed in September 30 (P.L. 110-329). Table 5. Status of FY2009 Defense Appropriations, H.R. 2638, Division C Subcommittee Markup House 7/30/08 Senate House Report House Passage 9/10/08 Senate Report Senate Passage Conf. Report Cong. Record pp. H9434-H 9870 Conference Report Approval House Senate 370-58 9/24/08 9/27/08 78-12 Public Law P.L. 110329 9/30/08 Is the Budget Too Small? The 4% of GDP Debate For several months leading up to action on the FY2009 defense funding legislation, a number of senior military officers, as well as research groups and advocacy organizations, argued that defense spending needs to be substantially higher in the next few years to avoid drastic cuts in major weapons programs or in the size of the force. Many have called for a baseline defense budget, not including war-related costs, pegged to about 4% of Gross Domestic Product—an amount that would be anywhere from $70 to $180 billion per year higher over the next few years than the Administration plan. 4 Senior leaders of the military services were particularly vocal in arguing for substantial increases in the defense budget. The Chairman of the Joint Chiefs, Admiral Michael Mullen, has, for some time, urged 4% of GDP for defense. For the previous two years, the Chief of Staff and Secretary of the Air Force argued that the Air Force needs an average of $20 billion more each year for the next several years in weapons acquisition accounts. Senior Army officials pointed out that the Army budget, including war costs, has grown to over $230 billion. Though it may come down some, they say, if forces in Iraq and elsewhere are brought home, several more years of spending at near that level will be needed to repair, replace, and upgrade equipment consumed by the wartime pace of operations. For their part, Navy leaders now calculate that the long-term shipbuilding plan they have proposed for the past few years will, in the future, cost an average of $20 billion a year in FY2007 prices, an increase of about 40% over earlier estimates.5 These arguments for a substantial increase in the defense budget, however, come at a time when, by historical standards, military spending appears to be very robust. Between FY1998, when the 4 For an example of the 4% argument, see Jim Talent and Mackenzie Eaglen, “Providing for the Common Defense: Four Percent for Freedom,” Heritage Foundation, December 13, 2007. The target is not intended to be very precise— proponents have not specified, for example, whether the 4% goal applies to just the Defense Department budget or to the national defense budget function—a difference, in itself, of $22-23 billion each year. 5 For Admiral Mullen’s views, see Geoff Fein, “National Discussion Needed On Whether To Boost DoD Spending Above 4 Percent, Chairman Says,” Defense News, February 1, 2008. For statements by Air Force leaders, see Erik Holmes, “Fewer Airmen, Less Cash: With Fleet Continuing to Age, Wynne Says Drawdown Savings Are Less than Expected,” Air Force Times, October 1, 2007. For costs of the Navy shipbuilding plan, see CRS Report RL32665, Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress, by Ronald O’Rourke. Congressional Research Service 8 Defense: FY2009 Authorization and Appropriations post-Cold War decline in defense spending reached its zenith, and FY2008, the baseline Department of Defense budget, not including war costs, increased by almost 40% above inflation (see Table 6). After adjusting for inflation, the requested FY2009 baseline DOD budget was more than $100 billion, or about 20%, greater than the average during the Cold War (measured from the end of the Korean War in FY1954 through FY1990). Requested funding for weapons acquisition (procurement plus R&D) in FY2009 was more than $45 billion—or about one-third— higher than the annual Cold War average. Table 6. DOD Budget Authority, FY1998-FY2013 (amounts in billions of dollars) Constant FY2009 Dollars Current Year Dollars Total DOD Base DOD Supplemental Total DOD Base DOD Supplemental FY1998 258.3 255.4 2.8 357.2 353.2 3.9 FY1999 278.4 269.3 9.1 375.1 362.9 12.2 FY2000 290.3 281.8 8.6 381.4 370.1 11.2 FY2001 318.7 299.3 19.4 405.8 381.1 24.6 FY2002 344.9 328.7 16.2 427.7 407.5 20.1 FY2003 437.7 375.1 62.6 526.0 450.8 75.2 FY2004 470.9 401.4 69.5 547.9 467.0 80.9 FY2005 483.9 381.9 101.9 540.7 426.8 113.9 FY2006 536.5 412.4 124.0 580.3 446.1 134.2 FY2007 603.0 431.7 171.3 635.5 455.0 180.5 FY2008 670.5 481.2 189.3 686.3 492.6 193.8 FY2009 588.3 518.3 70.0 588.3 518.3 70.0 FY2010 527.0 527.0 — 514.8 514.8 — FY2011 533.1 533.1 — 508.5 508.5 — FY2012 542.4 542.4 — 504.7 504.7 — FY2013 552.7 552.7 — 501.8 501.8 — Source: Total DOD budget and deflators from Department of Defense, National Defense Budget Estimates Fiscal Year 2009, March 2008; supplemental appropriations by CRS. Data thru FY2007 are actual amounts. Data for FY2008 is the projected total as of March, 2008. Data from FY2009 is the DOD request and data for subsequent years are DOD projections. The disconnection between the size of the budget and the appeals for more money appears even more striking when amounts that have been appropriated for war costs are added to the equation. On top of a baseline DOD budget that grew from $255 billion in FY1998, in current year prices not adjusted for inflation, to almost $520 billion in FY2008, supplemental appropriations for warrelated costs climbed from $19.4 billion in FY2001, as an initial response to the 9/11 attacks, to $63 billion in FY2003, the year of the Iraq invasion, to an estimated $189 billion in FY2008. While large portions of the supplementals have been consumed by war-related operating costs, substantial amounts have also been devoted to buying new equipment, particularly for the Army and the Marine Corps. Although the bulk of this acquisition has been for force protection, Congressional Research Service 9 Defense: FY2009 Authorization and Appropriations communications, and transportation, the effect has been to modernize much of the basic equipment stock of both services, in effect augmenting their baseline budgets. The fact that so large a level of spending appears to the military services to be so inadequate has several explanations—and the policy implications are, accordingly matters of varying interpretation.6 Reasons include the following. • Future baseline budgets are widely expected to decline: The Administration plan to balance the federal budget by FY2012 includes limits on defense as well as non-defense spending. White House budget projections accommodate an increase of about 5% above inflation in the FY2009 DOD budget, but project a cumulative decline of about 3% between FY2009 and FY2012. Many unofficial projections of the deficit situation are less sanguine than the Administration’s, so many analysts expect, at best, a flat baseline defense budget for the foreseeable future.7 Increased costs in part of the budget, therefore, will necessarily come at the expense of resources available in other areas. • Supplemental appropriations are expected to decline as well: Although plans to withdraw from Iraq are uncertain, the military services expect that supplemental appropriations will come down within a few years. Costs for training and equipment maintenance that have been covered in supplementals, then, will migrate back into the baseline budget at the expense of other programs, and money to further upgrade ground forces will have to be found elsewhere. • Costs of military personnel have grown dramatically in recent years: Since the end of the 1990s, Congress has approved substantial increases in military pay and benefits, including pay increases of ½ percent above civilian pay indices in seven of the past eight years, three rounds of “pay table reform” that gave larger raises to personnel in the middle grades, increased housing allowances to eliminate onbase and off-base disparities, DOD-provided health insurance for Medicareeligible military retirees (known as “TRICARE” for Life),8 concurrent receipt of military retired pay and veterans disability benefits that had earlier been offset, elimination of a reduction in retiree survivor benefits that had occurred at age 62, and large increases in enlistment and reenlistment bonuses and special pays. Although bonuses and some other payments may decline in the future, most of the past increases in pay and benefits have been built into the basic cost of personnel. CRS calculates that uniformed personnel now cost 40% more, after adjusting for inflation, than in FY1999.9 6 These issues were discussed in a CRS seminar on the FY2009 defense budget on February 11, 2008. A video of the seminar is available on line or as a DVD to congressional offices. See “FY2009 Defense Budget: Issues for Congress, Online, Video,” at http://www.crs.gov/products/multimedia/MM70107.shtml. The seminar slides illustrate points discussed below, and are available at “FY2009 Defense Budget: Issues for Congress: A Powerpoint Summary,” available at http://www.crs.gov/products/browse/documents/WD06002.pdf. 7 See, for example, the annual 10 year projections of defense spending by the Government Electronics and Information Technology Association, at http://www.geia.org/. 8 TRICARE is a DOD-run health insurance program for military dependents. 9 This reflects the military personnel budget divided by the number of active duty personnel, indexed for inflation using the consumer price index. See the slides cited in Footnote 6 for a graph that illustrates the trend. Congressional Research Service 10 Defense: FY2009 Authorization and Appropriations • Operating costs continue to grow above base inflation: Historically, military operation and maintenance budgets, which pay for everything from personnel training, to weapons repairs, to facility operations, to health care, have increased relative to the size of the force by about 2.5% per year above inflation. These increases are not as large as in some areas of the civilian economy, such as health care, but they do not reflect gains in productivity that are common in other sectors of the economy. Continued growth in operating costs, which is now widely seen as a fact of life in defense planning, erodes the availability of resources for weapons modernization and other priorities. • Increasing generational cost growth in major weapons programs: It is generally expected that new generations of weapons will be more expensive than the systems they replace as weapons technology advances. The rate of generational cost growth, however, is becoming a matter of increasing concern within the Defense Department. New stealthy aircraft, multi-mission ships, advanced space systems, and networked missiles, guns, and vehicles appear to be getting more expensive than their predecessors at a greater rate than in the past. Unless budgets increase more rapidly than costs, trade-offs between the costs of new weapons and the size of the force may be required. • Poor cost estimates: The difficulties engendered by accelerating intergenerational weapons cost growth are exacerbated by poor cost estimation. The Government Accountability Office has documented frequent, substantial increases in costs of major defense systems compared to original development estimates. A side-effect of inaccurate cost projections is to exacerbate instability in the overall defense budget, which entails inefficient production rates for major weapons programs and increased costs due to changing production plans. 10 • New requirements based on the lessons of Iraq and Afghanistan: The wars in Iraq and Afghanistan have led to very large increases in equipment requirements for ground forces, particularly for force protection, communications, and transportation. National Guard combat units that earlier were equipped with older systems cascaded from active units are now seen as part of the rotation base that require equally modern equipment. And full sets of current equipment are also expected to be available not only for next-to-deploy units, but also for units as they begin to reset from overseas rotations. A key lesson of the war is that what used to be called “minor procurement” for ground forces was substantially undercapitalized. • A broader range of national security challenges: A common presumption before 9/11 was that forces trained and equipped for traditional conflicts between national armies would be able to cope with what were seen as less demanding other challenges such as stability operations. Now the view is that forces must be designed not only for traditional conflicts, but for insurgencies and other irregular wars, support of allies, threats of catastrophic attacks by non-state actors with weapons of mass destruction, and entirely new kinds of disruptive attacks on specific U.S. and allied vulnerabilities. The effect has been to broaden 10 For GAO’s most recent annual overview of defense acquisition cost growth, see Government Accountability Office, Defense Acquisitions: Assessments of Selected Weapon Programs, GAO-08-467SP, March 31, 2008, available at http://www.gao.gov/new.items/d08467sp.pdf. Congressional Research Service 11 Defense: FY2009 Authorization and Appropriations requirements without, necessarily, an attendant offsetting reduction in older force goals. When these factors are taken as a whole, it is not so surprising that military planners discover some shortfalls. But, for Congress, it may not be so obvious that the principle answer is simply to provide more money for defense. As a practical matter, the arguments for more money that senior military leaders have begun to lay out appear most likely to become matters of debate in Congress once the next Administration takes office. The next Secretary of Defense, and the 111th Congress, may, very early on, face a contentious debate about defense resources. More money is one alternative. Other alternatives may include backing away from plans to add 92,000 active duty troops to the Army and Marine Corps; shifting resources among the military services to reflect new challenges rather than allocating them roughly the same proportions every year; reviewing requirements for expensive new technologies in view of the presence or absence of technologically peer or near peer competitors; and shifting resources from military responses to global threats toward non-military means of prevention. The defense budget environment, however, appears likely to be troubling enough that it will force some attention to these matters earlier in the term of the next President rather than much later. Potential Issues in the FY2009 Base Budget Request Following is a brief summary of some of the other issues that may emerge during congressional action on the FY2009 defense authorization and appropriations bills, based on congressional action in prior years and early debate surrounding the President’s pending request. Military Pay Raise The budget includes $2 billion to give military personnel a 3.4% pay raise effective January 1, 2009, an increase that would keep pace with the average increase in private-sector wages as measured by the Labor Department’s Employment Cost Index (ECI), as required by law.11 For several years, some have contended that service members’ pay should increase at a faster rate than the annual increase in the ECI in order to compensate for a lag in military pay resulting from budget-constrained pay hikes in the 1990s. DOD officials deny that any such pay-gap exists, but Congress typically has sided with the advocates of larger increases. For every fiscal year but one since FY2000, Congress has mandated a military pay increase one-half percent higher than the rate of increase in the ECI. Army and Marine Corps End-Strength Increases The budget includes $20.5 billion to pay for the costs in FY2009 of the $112 billion multi-year plan to increase active-duty end-strength by a total of 92,000 Army and Marine Corps personnel. Most of the additional personnel are slated for assignment to newly created combat units—Army brigade combat teams and Marine regiments—which would enlarge the pool of units available for overseas deployment. This would make it easier for the services to sustain overseas roughly the number of troops currently deployed in Iraq and Afghanistan while allowing soldiers and Marines 11 See CRS Report RL33446, Military Pay and Benefits: Key Questions and Answers, by (name redacted). Congressional Research Service 12 Defense: FY2009 Authorization and Appropriations to spend more time between deployments at their home bases for rest and retraining. The plan has been challenged by some who note that, after the initial investment costs have been covered, the additional units would cost about $13 billion annually, in a time when the total DOD budget is expected to be relatively flat. It also has been criticized by some who contend that the Army in particular needs more units organized and trained especially for counter-insurgency and advisory missions more than it needs additional traditional combat units.12 TRICARE Fees and Co-pays For the third consecutive year, the Administration’s budget assumes that part of the cost of the Defense Health program—$1.2 billion in the pending FY2009 request—will be covered by an increase in fees, co-payments and deductibles charged to retirees under the age of 65 who participate in TRICARE, DOD’s medical insurance program for active and retired service members and their dependents. The increases are intended partly to restrain the rapid growth of DOD’s annual health-care budget—projected to reach $64 billion by FY2015—and partly to compensate for the fact that TRICARE fees have not been increased since 1995.13 This year, as in the two previous years, the proposed fee increases are vehemently opposed by organizations representing service members and military retirees who argue that giving medical care to retirees on favorable terms is appropriate given the unique hardships of a military career. Congress rejected the proposed fee hikes in the FY2007 and FY2008 budget proposals, and the Senate Armed Services Committee has done so in drafting its version of the FY2009 defense authorization bill. Projected Navy Strike Fighter Shortfall Some analyses of the number of F-18 strike fighters available to the Navy show a substantial shortfall of aircraft from about the middle of the next decade until about 2025, when the full planned number of F-35 Joint Strike Fighters becomes available. The number of available aircraft, however, depends on assumptions about the number of hours that current aircraft can fly, and at what cost for maintenance, upgrades, and overhauls. Boeing has recently offered to sell additional F/A-18E/F versions of the aircraft to the Navy for about $50 million apiece, as much as 10% cheaper than planned for additional aircraft, if the Navy agrees to buy 170 aircraft in a multiyear contract that would have early termination penalties. Several Members of Congress have expressed concerns about the potential shortfall and may propose that the FY2009 authorization approve a new multiyear deal. Future funding for the additional aircraft, however, might compete with funds for other projects, particularly if defense budgets level off in the 2010s.14 12 See CRS Report RL34333, Does the Army Need a Full-Spectrum Force or Specialized Units? Background and Issues for Congress, by (name redacted). 13 For background, see Government Accountability Office report GAO-07-647, Military Health Care: TRICARE CostSharing Proposals Would Help Offset Increasing Health Care Spending, but Projected Savings Are Likely Overestimated, May 2007. 14 Megan Scully, “Boeing Presses Armed Services Panels To Have Navy Buy More Super Hornets,” National Journal Congress Daily AM, April 29, 2008. Congressional Research Service 13 Defense: FY2009 Authorization and Appropriations LPD-17-Class Ship Procurement For the past two years, the Marine Corps has included a request for an additional LPD-17-class amphibious ship, which would be the 10th to be bought, at the top of its unfunded priorities list. There has been some support in Congress for adding a 10th LPD, but funding might have to come at the cost of financing for surface combatant ships such as the DOG-1000 destroyer. Support for shifting money from the DOG-1000 to LPDs or other ships that have been in production for some time comes partly from advocates of the Marine Corps and from legislators who represent the Gulf coast, where the ship would be built. In addition, there has been some support for a shift because the cost and design of the LPD-17—as for TAKE auxiliary ships and DOG-51 destroyers—has been stable for some time. 15 Funding for DDG-1000 Destroyers versus Other Ships A directly related issue is whether Congress will agree to continue funding DDG-1000 acquisition. The Administration’s FY2009 request includes $2.6 billion for a third DDG-1000. Several legislators on the defense committees have proposed eliminating the funds and using the money instead to buy a mix of LPD-17, TAKE auxiliary ships, and DDG-51 destroyers. This would spread available shipbuilding money more widely to sustain the industrial base, provide funding to programs in which costs are stable and more predictable, and also allocate funds to less expensive ships that might be built, in the long run, in larger numbers to sustain the Navy’s 313 ship fleet. Littoral Combat Ship Funding The Administration has also requested $920 million for two Littoral Combat Ships (LCS). This is a relatively small, lower cost ship with a common hull to support modular designs for several purposes. It is intended to be bought in large numbers over time for operations in relatively closeto-shore waters. The program has suffered significant cost growth, however, raising questions about the number of ships that can be afforded. Last year, Congress cut funding for all but one ship and shifted the savings to purchase other ships. This year may again be a test of congressional support for the ship in view of continuing cost issues. 16 CG-X Design The CG-X is the current designation for a new ship dedicated to missile defense missions. Its design was, for many years, expected to be based on the DDG-1000. Now, however, it appears that the Navy is inclined to build a substantially larger ship. Some defense committee members have raised questions about the status of the Navy’s design and about the affordability of the program. There has also been some support in Congress for building a nuclear powered cruiser.17 15 Geoff Fein, “Lawmakers Hope To Add Three More Ships To Navy’s FY ‘09 Procurement Plan,” Defense Daily, February 28, 2008. 16 See CRS Report RL33741, Navy Littoral Combat Ship (LCS) Program: Background, Oversight Issues, and Options for Congress, by Ronald O’Rourke. 17 See CRS Report RL34179, Navy CG(X) Cruiser Program: Background, Oversight Issues, and Options for Congress, by Ronald O’Rourke. Congressional Research Service 14 Defense: FY2009 Authorization and Appropriations Reliable Replacement Warhead There has been a great deal of controversy in Congress in recent years about the Energy Department’s plans to design a new nuclear warhead intended, according to its advocates, to take advantage of new technologies to improve safety and reliability in a new warhead to replace deteriorating older systems. In the past, Congress has provided funding only for conceptual design of the Reliable Replacement Warhead (RRW), but it has not permitted funds to be used for engineering development. The FY2008 consolidated appropriations act, P.L. 110-161, which included energy and water appropriations, provided no DOE funds for the RRW. In the FY2009 budget, DOE has requested $10 million for RRW design, and the Navy has requested $23 million. 18 Missile Defense The Administration requested $9.3 billion for missile defense R&D in FY2009. While Congress has generally supported about the level of spending the Administration has requested in recent years, it has frequently reduced funding for technologically more challenging systems such as the kinetic energy interceptor program to intercept missiles in the boost phase, and it has increased funding for currently deployed systems, mainly the Patriot PAC III theater defense system. For the past two years, Congress has also eliminated money to begin construction at missile defense sites in Europe, saying in various reports that the funding was premature because there was no firm agreement with Poland and the Czech Republic where deployment is planned. The FY2009 request includes $132.6 million for military construction at an interceptor site in Europe, which is planned in Poland, and $108.5 million for military construction at a radar site, which is planned in the Czech Republic.19 Long-Range Non-Nuclear Prompt Global Strike For the past several years, the Administration has pursued programs that might permit it to deploy conventional warheads on long-range missiles that now carry nuclear warheads. In recent years, this effort has focused on the possible deployment of conventional warheads on Trident submarine-launched ballistic missiles. The funding requests sought to continue R&D on the reentry vehicle that would carry the warhead, and have sought to begin modifying and equipping Trident missiles and submarines to carry the new reentry vehicles. Congress has not approved this funding. In FY2007, it permitted the continuing R&D on the reentry vehicle, but did not fund the programs that would modify the missiles and submarines. In FY2008, Congress again rejected all funding for the conventional Trident modification, and aggregated the funding for research on the reentry vehicle with other DOD funding for research on prompt global strike technologies. It directed that DOD explore all options for achieving the PGS mission, and not focus on the nearterm Trident option. Congress has objected to the Trident option in part because of doubts that the capability is needed immediately, and in part because of concerns that other nations might 18 For a full discussion, see CRS Report RL32929, The Reliable Replacement Warhead Program: Background and Current Developments, by Jonathan Medalia. 19 For the current status of the program, see CRS Report RL34051, Long-Range Ballistic Missile Defense in Europe, by (name redacted) and (name redacted). Congressional Research Service 15 Defense: FY2009 Authorization and Appropriations mistake the nature of a U.S. Trident missile launch. Congress appropriated $100 million for this combined program in FY2008; the Administration has requested $117 million for FY2009.20 Future Combat Systems The FY2009 budget request includes $3.6 billion to continue development and begin production of the Army’s Future Combat Systems (FCS). FCS is a computer-networked array of 14 types of manned and unmanned ground and aerial vehicles intended to replace the Army’s current fleet of combat vehicles, including M-1 Abrams tanks and M-2 Bradley infantry vehicles, beginning in 2015. The Army has estimated that the entire program could cost $230 billion over many years and the Defense Department’s Cost Analysis Improvement Group (CAIG) projects the cost to be $300 billion. Critics have assailed the program on several grounds: some argue that it is unaffordable; some contend that it is optimized to fight the sort of conventional battles at which the U.S. Army already excels rather than the insurgencies, such as those in Iraq and Afghanistan, that it may be more likely to confront; and some object that the program as currently scheduled will take too long to get more effective weapons into the hands of the troops.21 In FY2006-08, Congress cut a total of $789 million from the Army’s FCS budget requests. This year, House Defense Appropriations Subcommittee Chairman John P. Murtha has suggested that near-term funding for the program be increased by $20 billion to accelerate deployment of those elements of FCS nearest completion, at the expense of cancelling or delaying other elements of the program. 22 F-35 Joint Strike Fighter Alternate Engine For the third consecutive year, the Administration has proposed cancellation of the effort to develop the General Electric F-136 engine as a potential alternative to the Pratt & Whitney F-135 currently slated to power the F-35 Joint Strike Fighter. The $6.7 billion requested for the F-35 program in FY2009 includes $3.1 billion to continue development of the plane and $3.7 billion to buy 16 aircraft, but no funds to continue development of the alternative engine. DOD has argued that the alternative engine is a needless expense because the process of designing and developing high-performance jet engines has become much less uncertain than it once was. But Congress has backed development of the alternate engine since 1996, likening the current situation to the case of the F-15 fighter in the late 1970s which was handicapped by problems with its Pratt&Whitneybuilt engines until Congress mandated development of an alternative (GE-built) engine. To keep the F-35 alternative engine program going, Congress added $340 million to the FY2007 budget and $480 million to the FY2008 budget. F-22 Fighter Congress may want to consider whether to add funds to the Air Force’s F-22 fighter program either to shut down production or to continue it. Although Air Force officials have argued 20 See CRS Report RL33067, Conventional Warheads for Long-Range Ballistic Missiles: Background and Issues for Congress, by (name redacted). 21 See CRS Report RL32888, The Army’s Future Combat System (FCS): Background and Issues for Congress, by (name redacted). 22 Defense News, “Battle Over Proposal to Speed FCS,” by Kris Osborne, March 24, 2008. Congressional Research Service 16 Defense: FY2009 Authorization and Appropriations vigorously for purchase of 381 of the planes, DOD plans to buy only 183, with the last 20 paid for by $3.4 billion included in the FY2009 budget. However, the request includes no funds to pay for closing the F-22 production line in an orderly way that would facilitate its resuscitation at a later date. Reportedly, the shut down could cost as much as $500 million.23 DOD officials have said they may include in the FY2009 war cost supplemental request—not yet sent to Congress— funds to buy four additional F-22s which, they contend, would defer the necessity of a shut down decision until the next Administration had time to decide whether to continue production or end it.24 However others deny that funding for four planes would delay the need for a decision long enough to make a difference. Mid-Air Refueling Tanker The FY2009 budget request includes $832 million to continue developing a new mid-air refueling tanker (designated KC-X) and $62 million for components that would be used to begin building the planes. On February 29, 2008, the Air Force selected a consortium consisting of Northrop Grumman and the European Aeronautic Defense and Space Company (EADS)—the parent company of Airbus—over Boeing to build the new tankers. But on June 18, the Government Accountability Office (GAO) upheld Boeing’s protest of the Air Force decision and DOD announced that it would re-compete the award. With the initial contract for 179 aircraft worth $12.1 billion (and the final cost of the purchase estimated to reach approximately $35 billion) proponents of the competing bidders may try to tilt the second competition toward one firm or the other. On September 10, Defense Secretary Robert Gates cancelled the second competition to select a new tanker. In a statement, Gates said there was not enough time for DOD to complete the selection process by next January, when a new Administration will take office and that, accordingly, he had decided to allow the next Administration to define the requirements budget allocation for the new plane. 25 During a House Armed Services Committee hearing on September 10, Gates said DOD soon would recommend to Congress how to allocate the tanker funds requested for FY2009. On September 15, Air Force Chief of Staff Gen. Norton Schwartz, reportedly said in a press conference that it could take the next Administration between eight months and four years to conduct a new tanker competition. C-17 Cargo Jet As with the F-22 fighter program, so with the C-17 long-range cargo plane. The Administration’s FY2009 budget request includes neither funds to buy components to continue C-17 production, as many have urged, nor the funds that would be needed to terminate production. As with the case of the F-22, the Administration has said that the next President should decide the future of the C-17 program. While some DOD studies have concluded that the 190 C-17s previously funded will suffice, critics challenge that assessment on several grounds. While some in Congress favor 23 Aviation Week and Space Technology, “Fate of F-22, C-17 Lines Uncertain in Fiscal 2009,” by Amy Butler and David A. Fulgham, February 11, 2008. 24 Ibid. 25 “DoD Announces Termination of KC-X Tanker Solicitation,” DOD News Release 758-08, September 10, 2008. Congressional Research Service 17 Defense: FY2009 Authorization and Appropriations production of additional C-17s, others favor upgrades to older C-5 cargo planes DOD plans to retire.26 “Soft” Power Functions and Interagency Burden-Sharing27 Policymakers are debating the appropriate balance between military and civilian personnel in operations and activities involving “soft” power functions, i.e., building and strengthening government institutions and economic systems abroad, as well has providing humanitarian assistance. As demands have increased on military personnel to perform such functions over the past several years, especially in Iraq and Afghanistan, Congress has granted DOD new authorities and funded expanded DOD activities in areas where civilian agencies were traditionally in the lead. For some policymakers, the expanded use of the defense budget to fund, and military personnel to perform, “stabilization and reconstruction” activities reflects shortfalls in civilian agency budgets and in civilian personnel that should be remedied. Nevertheless, there is no consensus on an optimal division of labor, authorities, and funding sources for such functions, or how to achieve that balance, nor on appropriate interim arrangements. Among the DOD programs of most concern: • The Commander’s Emergency Response Program (CERP) provides funds for commanding officers in Iraq and Afghanistan to carry out small-scale reconstruction programs, to fund state-building activities such as supporting local militias such as the Sons of Iraq, and to provide urgent humanitarian relief. In early 2008, the Administration requested Congress make CERP authority permanent and extend its use to other developing countries where U.S. forces are operating. • “Section 1206” Global Train and Equip authority allows the Secretary of Defense to fund, with the concurrence of the Secretary of State, the training and equipping of foreign military forces for counterterrorism operations and to participate in or to support military and stability operations in which U.S. armed forces participate. In early 2008, the Bush Administration asked Congress to codify an expanded version of Section 1206 to increase the annual authorization from $300 to $750 million and to permit DOD to train and equip a broad array of security forces in addition to military forces. It asked for an FY2009 appropriation of $500 million. 26 See CRS Report RL34264, Strategic Airlift Modernization: Analysis of C-5 Modernization and C-17 Acquisition Issues, by (name redacted) and (name redacted). 27 Prepared by Nina Serafino, Specialist in International Security Affairs. For more information on this topic and related programs, see CRS Report RL34639, The Department of Defense Role in Foreign Assistance: Background, Major Issues, and Options for Congress; CRS Report RS22855, Section 1206 of the National Defense Authorization Act for FY2006: A Fact Sheet on Department of Defense Authority to Train and Equip Foreign Military Forces; CRS Report RS22871, Department of Defense “Section 1207” Security and Stabilization Assistance: A Fact Sheet; CRS Report RL32862, Peacekeeping/Stabilization and Conflict Transitions: Background and Congressional Action on the Civilian Response/Reserve Corps and other Civilian Stabilization and Reconstruction Capabilities; and CRS Report RL34003, Africa Command: U.S. Strategic Interests and the Role of the U.S. Military in Africa. Congressional Research Service 18 Defense: FY2009 Authorization and Appropriations • The Combatant Commander Initiative Fund (CCIF) has traditionally been used to fund foreign participation in military exercises and the military education and training of foreign personnel, and certain humanitarian and civil assistance. In 2006 Congress also added to the permitted categories, “civic assistance, including urgent and unanticipated humanitarian relief and reconstruction assistance.” For FY2009, the Administration requested $100 million for the CCIF specifically to meet those needs. • “Section 1207” Security and Stabilization funding authorizes DOD to transfer defense articles, services and other support to assist civilian agency responses to critical situations, in particular stabilization activities and operations planned and coordinated by the State Department’s Office of the Coordinator for Reconstruction and Stabilization (S/CRS). The Administration requested authority to transfer $200 million for this purpose in FY2009. • The Administration has requested $389 million in FY2009 to create U.S. Africa Command (AFRICOM) to give a senior general unified command over activities related to Africa that, previously, had been distributed among three regional DOD commands. Although the new organization is intended to have a large nonmilitary staff and to cooperate extensively with the State Department, Agency for International Development and other civilian agencies, some question the wisdom of giving DOD such a prominent leadership role in U.S. policy toward Africa. War Funding Issues in the FY2009 DOD Bridge Fund28 To get a more complete picture of war funding, the John Warner FY2007 National Defense Authorization Act requires the Administration to request a full year’s war cost in the February budget. Despite this requirement, the Administration included in its FY2009 budget request only a placeholder figure of $70 billion for bridge funding, with no details, that was intended to cover the gap between the beginning of the fiscal year and passage of a supplemental. In their spring markups, the authorization committees used the original $70 billion placeholder figure. On May 2, 2008, the Administration filled in the details by submitting an amended emergency war request with $66 billion for the Department of Defense (DOD) and $4 billion for State/USAID programs; however, these materials arrived too late to be taken into account in the authorization markup this spring.29 Since FY2004, the Defense Department has generally received war funding in two appropriations acts—a bridge fund included as a separate title in DOD’s baseline appropriations bill to cover the 28 Prepared by (name redacted), Specialist in U.S. Defense Policy and Budget. See Sec. 1008, P.L. 109-364, the John Warner National Defense Authorization Act for Fiscal Year 2007 for requirement for annual war costs; see also H.Rept. 110-652, Duncan Hunter National Defense Authorization Act for Fiscal Year 2009, p. 469. For DOD request, see DOD, Fiscal Year 2009 Global War on Terror Bridge Request, May 2008; http://www.defenselink.mil/comptroller/defbudget/fy2009/Supplemental/ FY2009_Global_War_On_Terror_Bridge_Request.pdf. 29 Congressional Research Service 19 Defense: FY2009 Authorization and Appropriations first part of the same fiscal year, and a separate supplemental appropriation provided after the fiscal year has begun. In the spring of 2008, however, Congress passed H.R. 2642, the FY2008 Supplemental Appropriations Act (P.L. 110-252) with funding to cover war costs for the rest of FY2008, and a bridge fund to cover part of the following fiscal year, FY2009.30 Coupled with DOD’s regular appropriations for FY2009, this bridge fund is expected to last until June or July 2009, leaving it to a new Administration to decide how much funding to request for the remainder of the year. Like the members of the House and Senate Appropriations committees, the members of the House and Senate Armed Services committees, which draft the defense authorization bill, did not address full-year war costs for FY2009. Instead, the authorizing committees included in their respective bills funding levels for the FY2009 bridge fund, along with various policy restrictions. The House passed its bill (H.R. 5658) on May 22, 2008 and the Senate passed its bill (S. 3001) on September 17, 2008, including levels that differed from funding already included in for FY2009 in the already enacted supplemental (P.L. 110-252, see Table 7).31 Dropping funding levels proposed in the House and Senate bills, the conference version of the authorization, S. 3001, adopts the funding levels included for FY2009 bridge fund already enacted in the FY2008 Supplemental except for a $2.1 billion addition for six more C-17 transport aircraft. Thus, S. 3001 includes a total of $68 billion for war funding compared to the $66 billion appropriated in the FY2009 bridge fund (H.R. 2642/P.L. 110-252). The conference authorization bill does, however, include different restrictions on funding and reporting requirements for the Iraq Security Forces Fund and the Commanders Emergency Response Program (see Table 7).32 FY2009 War Costs With passage of the FY2008 Supplemental (P.L. 110-252), CRS estimates that the total amount of DOD war funding for this fiscal year is $176 billion excluding funding that is not related to the wars in Iraq and Afghanistan.33 In February 2008 testimony, Secretary of Defense Gates suggested that war costs in FY2009 could total $170 billion, which would be about the same level as the FY2008 request excluding certain one-time costs for Mine Resistant Ambush Protected (MRAP) vehicles. The Administration said it had not submitted a full-year budget because of the uncertainty of predicting future troop levels in Iraq.34 30 Similarly, Congress appropriated the first tranche of $70 billion for FY2008 war funds in the FY2007 Consolidated Appropriations Act, P.L. 110-161 to fill the gap between the beginning of that fiscal year and passage of a supplemental. 31 War funding and policy restrictions are primarily in Title XV in H.R. 5658 and Titles XV and XVI in S. 3001. 32 See Sec. 1501, S. 3001 and explanatory statement for conference version; available at http://armedservices.house.gov/pdfs/fy09ndaa/FY09conf/S3001NDAAforFY2009.pdf. These caps in the authorization conference exceed the amount appropriated, in which case, the appropriation level probably sets funding. In this year’s authorization bills, funding levels for some programs like the ISFF and CERP were initially below appropriated levels, which would probably have taken precedence over the appropriations act under the “last in time” rule, under which the latest congressional action is in effect; see GAO, Principles of Federal Appropriations Law, Third Edition (Red Book), Volume I, p. 2-44; http://www.gao.gov/special.pubs/d04261sp.pdf. 33 See Table 4 in CRS Report RL33110, The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11, by (name redacted). 34 Congress appropriated $16.8 billion for MRAP vehicles in FY2008 filling the current requirement for 15,000 (continued...) Congressional Research Service 20 Defense: FY2009 Authorization and Appropriations In later testimony in May 2008, Secretary Gates suggested that “further reductions in the [U.S.] presence in Iraq during the course of 2009 and, perhaps, later this year” would contribute to DOD’s ability to return to 12-month tour lengths to which the President committed the Administration. 35 General Petraeus, former Commander of Multinational Forces, Iraq, and now head of Central Command, has been assessing troop levels since completion in July 2008 of the withdrawal of five combat brigades sent to Iraq in 2007 in the “surge.” With the departure from Iraq of these five additional combat brigades, and the completion of MRAP purchases funded last year, war costs in FY2009 will be below FY2008’s level. On September 9, 2008, the President announced a modest additional cut below surge levels of 8,000 troops in Iraq by January 2009 that would be coupled with an increase of troops in Afghanistan to meet requests from commanders on the ground for additional troops.36 Those additional troops could offset some if not all of the savings that would result from further troop reductions in Iraq.37 Working from the Administration’s original request, the House and Senate-passed versions of the FY2009 National Defense Authorization bills (H.R. 5658 and S. 3001) both proposed $70 billion in emergency bridge funds for DOD. Those bills were $5.8 billion above the amended request and the amount appropriated in the recently passed FY2008 Supplemental, H.R. 2642/P.L. 110-252. FY2009 Bridge Fund Prior to calendar year 2008, Congress has funded war costs by including a so-called “bridge fund” in the regular DOD appropriations bill for the pending year to cover part of that year’s war costs and then funding war costs for the balance of that year through a supplemental appropriations bill the following spring. But the FY2008 war cost supplemental (P.L. 110-252) enacted June 30, 2008 includes not only the war costs for the balance of FY2008 but also a $65.9 billion bridge fund for FY2009 to cover DOD war costs until a new Administration submits and a new Congress approves a FY2009 supplemental. Expected to last until June or July 2009, the FY2009 bridge fund was intended to give time to a new Administration to determine the future course in Iraq and Afghanistan. Like previous bridge funds, over 70% of the appropriated FY2009 bridge fund in P.L. 110-252 is dedicated to operation and maintenance funding to ensure that funding for operations is available well into the fiscal year (see Table 7 below). This appropriations act includes relatively small amounts for procurement—$4 billion compared to the $67 billion requested by DOD for all of FY2008—selecting those items that may be more urgently needed such as force protection upgrades or more uparmored HMMWVs for the Army. (...continued) vehicles for Iraq and Afghanistan. For $170 billion figure, see Deputy Secretary England testifying to House Budget Committee, FY2009 Budget for the Department of Defense, February 27, 2008. 35 Senate Appropriations Committee, Subcommittee on Defense, Transcript, “Department of Defense Fiscal Year 2009 Budget Request,” May 20, 2008, p. 13. 36 White House, Speech by President Bush at National Defense University, Distinguished Lecture Program, “President Bush Discusses Global War on Terror,” 9-9-08. 37 Department of Defense, DoD News Briefing with Geoff Morrell from the Pentagon, July 23, 2008; http://www.defenselink.mil/transcripts/transcript.aspx?transcriptid=4265. Congressional Research Service 21 Defense: FY2009 Authorization and Appropriations This leaves potentially controversial decisions about whether it is appropriate to cast as war costs service requests for major weapon systems such as EA-18 G electronic warfare aircraft or V-22 Osprey tilt rotor aircraft for the Navy, C-17 transport aircraft for the Air Force, or substantial upgrades to Army Abrams tanks or Bradley fighting vehicles, which some observers argue are more appropriately considered in the baseline budget as part of ongoing modernization programs. Congress halved DOD’s procurement request in the FY2008 supplemental appropriations act passed in late May (P.L. 110-252) reflecting in part on DOD’s informal proposals this spring to withdraw procurement requests for $6.7 billion in order to pay for higher fuel costs and other unanticipated needs. This may indicate that congressional scepticism about war-related procurement funding requests may be growing. 38 Although the House and Senate authorizers initially included funding for major weapons systems recommended such as F-22 aircraft for the Air Force, all but the C-17 aircraft were dropped in the conference version that, instead, adopted funding levels for the FY2009 bridge already enacted in the FY2008 Supplemental (P.L. 110252). Resolution of Issues Although the conference version of S. 3001, the FY2009 NDAA generally adopts the funding levels in the already enacted FY2008 Supplemental (HG.R. 2642/P.L. 110-252), it adds $2.1 billion for six more C-17 aircraft that is not included in that enacted bridge appropriations act. This brings the authorization total for the FY2009 bridge fund to $68 billion compared to the $66 billion appropriated (see Table 7). The conference bill also resolves most of the outstanding differences between the two houses and P.L. 110-232, the enacted supplemental. The FY2009 NDAA conference bill, does, however, add various restrictions and reporting requirements on the use of funds for several high-interest programs—the Iraq Security Forces Fund, Commanders Emergency Response Program, and the Joint Improvised Explosive Device Defeat Organization (JIEDDO). The conference bill: • authorizes $1 billion, half the request, for the Iraq Security Forces Fund (ISFF) but prohibits using these funds for infrastructure; • authorizes $1.5 billion, $200 million less than requested and $300 million more than appropriated for the Commanders’ Emergency Response program with a prohibition on projects over $2 million unless waived by the Secretary of Defense; • authorizes $350 million for Section 1206 authority to build and equip foreign militaries for counter-terror operations; • adopts the appropriated funding level for Mine Resistant Ambush Protected (MRAP) vehicles transfer fund; and • adopts the Senate proposal to require separate budget displays for Iraq and Afghanistan. Neither of the two authorizing bills, nor the already passed FY2009 bridge fund address the overall funding for the full year’s war costs for FY2009. That will be decided by the next 38 Department of Defense, “Draft Adjustment to the FY2008 Global War on Terror Pending Request,” March 2008. Congressional Research Service 22 Defense: FY2009 Authorization and Appropriations Administration. The current Administration did not submit a request for a full year’s war funding in part because of the uncertainty about future troop levels in Iraq and Afghanistan. With the conference bill, differences between House and Senate authorizers and amounts already appropriated are largely resolved (see Table 7). Congressional Research Service 23 Table 7. FY2009 War Bridge Funding (in billions of dollars and percent of total) Type of Spending FY2008 War Bridge Fund, P.L. 110-161 FY2009 Bridge Fund: Authorization and Appropriation Action (In billions of dollars or shares of total) Enacted Approp. P.L. 110-252 As Shares of Total House-Passed Auth., H.R. 5658, 5-1208 Senate-Passed Auth., S. 3001, 9-17-08 House-passed Conf. Auth, 924-08 In Billions of $ As Shares of Total Admin. Req. Enacted Approp., P.L. 110-252, 6-30-08 Military Personnel 1.1 2% 3.8 1.2 2% 1.2 0.8 1.2 Operation & Maintenance 50.2 72% 44.9 51.9 79% 52.0 47.0 51.9 Defense Health 0.6 1% 0.1 1.3 2% 1.3 0.8 1.3 Working Capital Fd/Othera 1.2 1% 2.2 0.0 0% 0.0 1.0 0.0 Procurement 6.1 9% 2.8 4.4 7% 9.5 11.2 6.5 RDT&E 0.0 0% 0.4 0.4 1% 0.4 0.2 0.4 Military Construction 0.0 0% 0.0 0.0 0% 0.0 0.5 0.0 Iraq Freedom Fund 3.7 5% 0.0 0.0 0% 0.0 0.2 0.0 Afghan. Sec. Forces Fund 1.4 2% 3.7 2.0 3% 2.0 3.0 3.7 Iraq Sec. Forces Fund 1.5 2% 2.0 1.0 2% 1.0 0.2 2.0 JIEDDOb 4.3 6% 3.0 2.0 3% 2.5 3.0 3.0 MRAPc 0.0 0% 2.6 1.7 2% [2.6] [.6] 2.6 Global Train & Equipd [.2] 0% [.8] [0.2] 0% [.3] [.3] [.4] Commanders’ Emerg. Response Programe [0.5] [1%] [1.7] [1.2] [2%] [1.5 or 2X Iraqi fdg] [0] [1.5] Coalition Support Capf [.3] [0%] [.9] [.2] [0%] [.2] [0] [.9] Rapid Acquisition Fund 0.0 0% 0.1 0.0 0% 0.0 0.0 0.1 Title Special Funds CRS-24 Type of Spending FY2008 War Bridge Fund, P.L. 110-161 FY2009 Bridge Fund: Authorization and Appropriation Action (In billions of dollars or shares of total) Enacted Approp. P.L. 110-252 As Shares of Total House-Passed Auth., H.R. 5658, 5-1208 Senate-Passed Auth., S. 3001, 9-17-08 House-passed Conf. Auth, 924-08 In Billions of $ As Shares of Total Admin. Req. Enacted Approp., P.L. 110-252, 6-30-08 Transfer Authorityg [4.0] [6%] [4.0] [4.0] [6%] [4.0] [3.0] [4.0] TOTAL 70.0 100% 66.0 65.9 100% 65.9 70.0 68.0 Title Source: CRS calculations based on Division L in P.L. 110-161, FY2008 Consolidated Appropriations; P.L. 110-252 FY2008 Supplemental as enacted on June 30, 2008; H.R. 5658, H.Rept. 110-652; S. 3001, S.Rept. 110-335; S. 3001, conference version and explanatory statement; http://armedservices.house.gov/pdfs/fy09ndaa/FY09conf/ S3001NDAAforFY2009.pdf; and http://armedservices.house.gov/pdfs/fy09ndaa/FY09conf/FY2009NDAAJointExplanatoryStatement.pdf. Notes: a. Working Capital Fund finances fuel and spare parts inventories. b. JIEDDO = Joint Improvised Explosive Device Defeat Organization, a transfer fund that funds RDT&E, Procurement and operational training to defeat Improvised Explosive Devices (IEDs). c. MRAP = Mine Resistant Ambush Protected vehicle fund, a transfer account for heavy trucks with V-shaped hulls that have proven resistant to IEDs. d. Congress set a funding cap on the amount that can be spent to train and equip foreign militaries in counter-terrorist operations for FY2007 and FY2008 under Section 1206 authority in P.L. 109-364, the FY2007 National Defense Authorization Act. In Sec. 9109, the FY2008 Supplemental set a funding limit of $150 million (P.L. 110252). e. Authority and funding caps for CERP, a program where commanding officers have discretion to provide funds to local authorities for reconstruction activities, is set in annual authorization and appropriations acts. f. Coalition support funds are for logistical support to allies conducting counter-terror operations in the region, primarily Pakistan. g. Transfer authority sets a cap on the amount of funds in the act that can be transferred from one account to another as long as the four congressional defense committees approve. CRS-25 Defense: FY2009 Authorization and Appropriations Funding for Iraq Security Forces (ISFF) The halving of DOD’s request for the ISFF from $2 billion to $1 billion in the enacted version of the FY2009 authorization bill reflects broad and growing sentiment to push the Iraqis to pay more of the cost of reconstituting their security forces in reaction to large and growing Iraqi oil revenues that are documented in a recent GAO report.39 In addition to the funding cut, the authorizers prohibit funding for any facilities used by Iraqi forces, limiting funding to equipment, supplies, services, training and facility repair (see Sec. 1508, S. 3001). This prohibition adopts the stricter House version rather than limiting infrastructure funding to smaller projects as proposed by the Senate. Senate authorizers argued that “the Iraqi Government is well able to afford to finance its own infrastructure needs at this point.”40 The strict prohibition on funding infrastructure in the authorization conference would presumably supersede report language in the appropriations act that required “equal cost-sharing” for all reconstruction projects above $750,000.41 These changes set new standards that increase Iraqi “burden-sharing” of the cost to rebuild its security forces and reconstruction. Strict Monitoring of Joint Improvised Explosive Device Defeat Fund (JIEDDO) Reflecting oversight concerns, the final version of the authorization bill provides $2.2 billion rather than the $3 billion requested, and requires that the Director of JIEDDO develop a science and technology investment strategy for countering Improvised Explosive Devices (IEDs), as well as annual reporting. In addition, the final bill requires five-day advance notification of obligations and 15-day notice of transfers (Sec. 1503-1505, S. 3001). Commanders Emergency Response Program Funding Another high visibility and rapidly growing program where the $1.5 billion authorization cap in the final authorization bill is below the request is the Commanders Emergency Response Program (CERP), which allows individual commanding officers to dispense funds for small-scale reconstruction projects, or to pay local militias such as the Sons of Iraq. The CERP program has grown from $180 million in FY2004, its first year, to $956 million in FY2007 to $1.7 billion in FY2008.42 39 GAO, Stabilizing and Rebuilding Iraq: Iraqi Revenues, Expenditures, and Surplus,” GAO-08-1031, August, 2008, p. 14. 40 Sec. 1616 in S. 3001 as reported and S.Rept. 110-335, p. 428; see also Sec. 1512 in H.R. 5658 as passed by the House. Section 1613 in S. 3001 as reported by the Senate lists equipment, supplies, services, and training as the only types of expenses that can be funded in the ISFF; Sec. 1616 applies the prohibition to any “large-scale infrastructure projects” above $2 million; see also Table 8. 41 Section entitled “Iraq Security Forces” in P.L. 110-252 and report language on p. S4337, Congressional Record, May 19, 2008. 42 Congressional Record, May 19, 2008, explanatory statement for, p. S4324. H.R. 2642, FY2008 Supplemental (P.L. 110-252). As later congressional action, the funding in the supplemental appropriations act (P.L. 110-252) took precedence over the authorization cap of $977 that was set earlier. Congressional Research Service 26 Defense: FY2009 Authorization and Appropriations Instead of adopting the House-proposed restrictions limiting U.S. funding for CERP) to no more than twice Iraqi funding, the authorization bill requires reporting of all projects over $500,000 and certifications for projects over $1 million. The bill also requires detailed reporting, including for Iraqi government contributions, and prohibits funding for projects above $2 million unless there are contributions from other countries, the Iraqi government, or private organizations or the Secretary of Defense submits a waiver (Sec. 1214, S. 3001).43 The final version of the authorization bill does, however, exempt CERP projects from the overall prohibition on infrastructure spending (Sec.1508) as was proposed in the Senate version. In addition, the appropriations act requires equal cost sharing of all reconstruction projects over $750,000 in report language as the “necessary first step in decreasing the Government of Iraq’s reliance on U.S. funds for reconstruction.”44 Section 1206 Training and Equipping of Foreign Military Forces In its FY2009 request, the Administration proposed a broadening of Sec.1206 authority to include training of foreign and border police as well as military forces, an increase in the current funding cap from $300 million to $750 million, and $500 million in designated funding rather than the current practice where funds are transferred from other programs.45 As recommended by both houses, the final version of the authorization bill rejects most of the Administration’s proposals and limits Section 1206 authority to train and equip foreign militaries for counter-terror operations, reflecting congressional concerns about the foreign policy implications of expanding DOD authority. The bill extends authorization for the Section 1206 program for three years. It also raises the annual cap to $350 rather than the $750 million requested (Sec. 1206, S. 3001).46 The FY2008 Supplemental sets a limit of $150 million for FY2008 but did not include a FY2009 cap.47 Reflecting action by both houses, the final authorization bill raises the limit for Sec. 1208 authority to fund foreign irregular forces from $25 million to $35 million until FY2013 and also specifies that the irregular forces would work with U.S. special forces. 48 43 For earlier House version, see Sec. 1214 in H.R. 5658 as passed by the House and H.Rept. 110-652, p. 454; the Secretary of Defense would also have to notify the Armed Services and Appropriations committees. 44 Congressional Record, p. S2808. S. 3001 includes no specific authorization level for CERP, making no change to the $977 million level set for both FY2008 and FY2009 in the FY2008 National Defense Authorization Act (Sec. 1205, P.L. 110-181, H.Rept. 110-477, p. 1014); Sec. 9104, P.L. 110-252 sets a cap of $1.2217 billion to fund CERP. 45 See CRS Report RS22855, Section 1206 of the National Defense Authorization Act for FY2006: A Fact Sheet on Department of Defense Authority to Train and Equip Foreign Military Forces, by (name redacted); see also DOD, FY2009 Legislative Request, September 2, 2008 and section by section analysis; http://www.dod.mil/dodgc/olc/ legislpro.html. 46 For more information, see CRS Report RS22855, Section 1206 of the National Defense Authorization Act for FY2006: A Fact Sheet on Department of Defense Authority to Train and Equip Foreign Military Forces, by (name re dacted) and CRS Report RL34639, The Department of Defense Role in Foreign Assistance: Background, Major Issues, and Options for Congress, coordinated by (name redacted). The House raised the cap to $400 million and the Senate retained the current $300 million cap; see H.Rept. 110-652, p. 452 and S.Rept. 110-335, p. 400. 47 See Sec. 9109, P.L. 110-252 for FY2008 cap; no general provision in Chapter 2, the FY2009 bridge. 48 See Sec. 1208 in H.R. 5658 and H.Rept. 110-652, p. 452; Sec. 1203 in S. 3001 and S.Rept. 110-335, p. 399 for earlier versions. Congressional Research Service 27 Defense: FY2009 Authorization and Appropriations MRAP Vehicle Funding In its amended submission, DOD requested $2.6 billion in the Mine Resistant Ambush Protected (MRAP) vehicle transfer fund to buy additional vehicles for as yet undefined requirements. The conference bill adopts the $1.7 billion funding level appropriated in the FY2008 supplemental (P.L. 110-252) rather than setting a cap with funds drawn from other accounts as was in the House bill or the $600 million level funding in the Senate bill.49 According to DOD, the current requirement for 12,000 MRAP vehicles is already funded while the House authorizers suggest that more funding is needed to buy additional V-shaped heavy-duty trucks for training purposes.50 Separating Iraq and Afghanistan Funding Currently, funding for Iraq and Afghanistan is provided in standard appropriation accounts, which mix funds for the two operations and the funds for DOD’s baseline and war appropriations. While the final version of the authorization bill does not specify separate amounts for Iraq and Afghanistan in FY2009 as the Senate bill did, it requires DOD to present separate budget displays for each operation at the appropriation level and by program, project or activity level in the next submission (Sec. 1502). In addition, the conference version requires that DOD provide a “detailed description of the assumptions underlying the funding for the period covered by the budget request, including the anticipated troop levels, the operations intended to be carried out, the equipment reset requirements necessary to support such operations,” as proposed by the House. 51 This requirement for separate budget displays would not necessarily require that DOD to set up individual accounts for war spending for each operation. Although separate war funding by operation would improve transparency and help Congress to see the relative cost of the two operations, DOD is likely to object to designating funds by operation in order to preserve its flexibility. According to the Senate report, separate funding displays would help prevent confusion between the two missions, a concern of both Secretary of Defense Gates and the committee. Caps on Transfers Finally, the final version of the authorization bill sets a $4 billion cap on transfer authority for FY2009 funds, which limits the overall amount that DOD can transfer between accounts as requested by DOD and adopted by the appropriations act (Sec. 1507, S. 3001).52 The level of 49 For authorization action, see Sec. 1506 and Sec. 1606 in S. 3001 and S.Rept. 110-335, p. 420 and p. 427, which provides $500 million for MRAPs for Iraq and $100 million for Afghanistan; Sec. 1515 in H.R. 5658, H.Rept. 110-652, p. 479; for appropriation action, see Sec. 9208, P.L. 110-252. 50 Inside Defense, “DOD Readying for Last Round of MRAP Vehicle Contract Awards,” June 30, 2008; CRS Report RS22707, Mine-Resistant, Ambush-Protected (MRAP) Vehicles: Background and Issues for Congress, by (name r edacted), p.4 and p. 5, 6-6-08. 51 Sec. 1502, S. 3001; this language may also reflect the fact that a very detailed cost of war amendment added by Congressman Braley was also added on the floor. See Title XV for Afghanistan and Title XVI for Iraq in S. 3001 as reported by the Senate and S.Rept. 110-335, p. 417-p. 428. See Sec.1002 and Sec. 1003 in H.R. 5658, and p. 427ff in H.Rept. 110-652. 52 For authorizing levels, see Sec. 1514 in S. 3001, and S.Rept. 110-335, p. 421 in the Senate and Sec. 1516 in H.R. 5658, and H.Rept. 110-65, p. 479 in the House. For the level in the FY2008 Supplemental for the FY2009 Bridge fund, (continued...) Congressional Research Service 28 Defense: FY2009 Authorization and Appropriations transfer authority is of considerable concern to DOD because it provides flexibility to adjust funding levels during execution. Bill-by-Bill Synopsis of Congressional Action to Date Congressional Budget Resolution The Concurrent Resolution on the Budget for FY2009 (S.Con.Res. 70), adopted by the Senate on June 4 and by the House on June 5, set an overall target for national defense budget authority of $612.5 billion. This is essentially identical to the President’s request ($611.1 billion) with the difference reflecting recalculation by the Congressional Budget Office (CBO) on the basis of slightly different technical assumptions. This total covers the so-called 050 function of the budget, which includes funding for DOD, defense-related nuclear-energy spending by the Department of Energy, and defense-related programs in other agencies. The same defense total had been included in both the House version of the budget resolution (H.Con.Res. 312), adopted March 13, and original version of S.Con.Res. 70, adopted March 14 by the Senate. The $612.5 billion total cap on defense budget authority set by the final version of S.Con.Res. 70, as in the House-passed resolution, was the sum of two ceilings set by the resolution: For national defense activities other than military operations in Iraq and Afghanistan (budget function 050), the ceiling is $542.5 billion; operations in Iraq and Afghanistan are covered by a separate ceiling of $70 billion (budget function 970), which is the amount of the placeholder funding request included in the President’s FY2009 budget. Subsequently, the Appropriations Committees of the House and Senate, under the so-called “302b allocation” process gave their respective defense subcommittees a budget authority allowance for FY2009 of $487.7 billion—which, in practice, is the ceiling for the FY2009 defense appropriations bill. FY2009 Defense Authorization: Highlights of the House Bill The House passed H.R. 5658, the Duncan Hunter National Defense Authorization Act for FY2009, on May 22 by a vote of 384-23. The bill would authorize $531.4 billion for national defense-related activities of DOD and other federal agencies and an additional $70 billion for costs related to military operations in Iraq and Afghanistan. The Administration’s initial FY2009 budget request included a lump-sum of $70 billion as an initial increment of funding for DOD and other agency costs related to combat operations in Iraq and Afghanistan. On May 2, five days before the House Armed Services Committee (HASC) (...continued) see Sec. 9203 in P.L. 110-252. Congressional Research Service 29 Defense: FY2009 Authorization and Appropriations subcommittees began marking up H.R. 5658, the Administration issued a budget amendment formally allocating the $70 billion request among appropriations accounts. However HASC, which also authorized the $70 billion by accounts in H.R. 5658, acknowledged only a handful of the specific allocations included in the May 2 amendment. The bill authorizes $2.0 billion of the $3.7 billion requested to support Afghan Security Forces and $1.4 billion of the $2.0 billion requested for support of Iraqi Security Forces. Within the $70 billion authorized for operations in Iraq and Afghanistan, the House bill also allocates nearly $4.9 billion for aircraft procurement programs not included in the Administration’s budget request: • $3.9 billion to buy 15 C-17 cargo planes; • $523 million for components that would be needed to fund an additional 10 F-22 Air Force fighters in FY2010; • $448 million to repair worn out wing structures on Navy P-3C patrol planes, which have been used extensively for reconnaissance in Iraq and Afghanistan. Congress has incorporated the Administration’s $70 billion FY2009 costs related to operations in Iraq and Afghanistan into H.R. 2642, the Second FY2008 Supplemental Appropriations Bill.53 The House version of the FY2009 defense authorization bill also included a provision (Sec. 1431) that would exempt it from the President’s Executive Order 13457, which prohibits agencies from complying with congressional earmarks not specified in statutory language. As is customary, the more than 500 earmarks associated with H.R. 5658 are specified in the HASC report accompanying the bill (H.Rept. 110-652), which it reported to the House on May 16. In a Statement of Administration Policy issued May 22, the Office of Management and Budget (OMB) cited the provision exempting the bill from the executive order dealing with earmarks as one of many provisions which, if included in the final version of the bill, would cause the President’s advisors to recommend a veto. Other provisions of H.R. 5658 cited by OMB as potential reasons for a veto are reductions totaling more than $700 million in the $10.8 billion requested for missile defense programs, a prohibition of proposed increases in health care fees and copays paid by some military retirees, and a provision requiring that any agreement with the Iraqi government concerning the legal status of U.S. military personnel in that country include a requirement that Iraq pay some of the costs of those forces.54 Pay Raise, Tricare, and Other Personnel Issues H.R. 5658 authorizes a military pay raise of 3.9 percent, rather than 3.4 percent as requested, and bars during FY2009 a proposed increase in TRICARE health insurance and pharmacy fees charged to some military retirees. Congress had prohibited proposed health care fee increases in each of the two previous budgets. To offset the lost revenue the proposed fee increases had been expected to generate, the bill would authorize, subject to appropriation, the transfer to the 53 For details, see CRS Report RL34451, FY2008 Spring Supplemental Appropriations and FY2009 Bridge Appropriations for Military Operations, International Affairs, and Other Purposes (P.L. 110-252), by (name redacted) et al. 54 Office of Management and Budget, Statement of Administration Policy. Congressional Research Service 30 Defense: FY2009 Authorization and Appropriations Defense Health Program of $1.3 billion from the unobligated balances of the National Defense Stockpile Transaction Fund. As requested, the bill would authorize increases in the active-duty end-strength of the Army (by 7,000) and Marine Corps (by 5,000), in line with the Administration’s plan to increase the activeduty end-strength of the two services by 92,000 personnel over their end-strength in FY2007. It also would add a total 1,431 personnel to the requested end-strength of the Navy and Air Force (at a cost of $101 million). The Administration had proposed to substitute civilians for this number of Navy and Air Force military personnel in medical care positions. But the House bill reaffirms a provision of the FY2008 National Defense Authorization Act (P.L. 110-181) prohibiting such military-to-civilian conversions of medical personnel. The bill also includes a provision that would allow a limited number of service members to take sabbaticals from active service for up to three years and return with no loss of rank or time-inservice. Tanker, Cargo, and Patrol Planes The bill denies authorization of $62 billion requested for long lead-time components to begin procurement of the Northrop Grumman KC-45A refueling tanker, but approved the request for $832 million to continue development of the aircraft. Some members have objected to the Air Force’s selection of the Northrop Grumman system, based on a European-designed Airbus for this mission, rather than a tanker version of the Boeing 767. According to the committee, denial of the long lead-time funding would not delay the program. The bill includes a provision (Section 134) requiring the Secretary of the Air Force to submit to the congressional defense committees a report on the process by which the requirements were established that were the basis for selecting a new tanker. Another provision (Section 801) requires the Secretary of the Air Force to review the impact on the decision to buy the Europeandesigned tanker of any subsidies by European governments that are illegal under the agreement reached in Uruguay round of the General Agreement on Tariffs and Trade. Although the budget request included no funds either to continue production of the C-17 cargo plane or to shut down the production line, the bill allocates $3.9 billion of the $70 billion requested for operations in Iraq and Afghanistan to buy an additional 15 C-17s. It also includes a provision (Section 131) that would allow the Air Force to retire C-5A cargo planes and replace them with additional C-17s only if a federally funded research and development center concludes that this would be more prudent than upgrading the engines and electronics on the C-5As. Fighter Planes The bill authorizes $3 billion requested for 20 F-22 fighters. However, it also adds to the bill authorization of $523 million for long lead-time components that would be used to build an additional 20 F-22s in FY2010. The Administration’s request includes neither the funds that would be needed to continue production of the F-22 beyond FY2009 nor the funds that would be needed to close down the production line. Congressional Research Service 31 Defense: FY2009 Authorization and Appropriations The bill authorizes the requests for $3.1 billion to continue development of the F-35 Joint Strike Fighter (JSF) and $3.7 billion to buy 16 of the planes. But it would add to the Administration request $525 million to continue development of an alternative engine for the JSF. Future Combat Systems (FCS) The bill cuts $200 million from the $3.6 billion requested for the Army’s FCS program. Armed Services Air and Land Forces Subcommittee chair Neil Abercrombie said these cuts were targeted to slow production of some components until they were more thoroughly tested. If the proposal were enacted, it would mark the fourth consecutive budget in which Congress trimmed the funding request for FCS. The bill also includes several legislative restrictions on the FCS program, including a requirement for annual reports to Congress on cost growth in the program’s eight types of manned ground vehicles (Section 213), an independent report on potential vulnerabilities of the digital communications web intended to link FCS components (Section 212), and a provision that would bar the program’s lead system integrators, Boeing and SAIC, from producing major components of the program (Section 112). 55 Anti-Missile Defense The bill authorizes a total of $10.1 billion for missile defense programs, which would be $719 million less than the President requested, but $213 million more than Congress appropriated for these programs in FY2008 (see Table A-3). It cuts the amounts requested for several programs intended to deal with long-range missiles and added to the amounts requested for defenses against short-range and medium-range missiles which, HASC said in its report, are the more pervasive threat. Among the reductions were cuts totaling $372 million from the $954 million requested to begin deploying in Poland and the Czech Republic an anti-missile system intended to deal with longrange missiles launched from Iran. The bill also includes a provision (Section 222) that would bar the proposed European deployment until (1) the governments of Poland and the Czech Republic have ratified agreements to accept the stationing of U.S. personnel and equipment on their territories; and (2) the Secretary of Defense has certified to Congress that the interceptor missiles intended for the European site—a modified variant of the interceptors currently deployed in Alaska and California—has passed operationally realistic flight tests. The bill cut $100 million from the $386 million requested to develop a new, high-speed interceptor missile (designated the Kinetic Energy Interceptor (or KEI) and it cut $43 million from the $421 million requested to develop an anti-missile laser carried in a Boeing 747. The KEI and Airborne Laser both are intended to destroy attacking missiles while in their “boost phase,” that is while they still are accelerating away from their launchers and, thus, are relatively easy to detect. The bill included a provision (Section 221) requiring a detailed analysis by a federally funded research and development center of the technical feasibility and cost-effectiveness of such 55 For additional background on DOD’s use of contractors as “lead system integrators,” see CRS Report RS22631, Defense Acquisition: Use of Lead System Integrators (LSIs) - Background, Oversight Issues, and Options for Congress, by (name redacted). Congressional Research Service 32 Defense: FY2009 Authorization and Appropriations boost-phase defenses, compared with various anti-missile systems already deployed or nearing production. The bill cuts from the request $100 million of the $354 million to develop a multiple-warhead interceptor able to hit several attacking missiles. It also cuts $10 million, the entire amount requested for the Space Test Bed, an experiment to test the feasibility of space-based anti-missile interceptors. Shipbuilding In its report, HASC criticized the Navy’s shipbuilding plan as both unaffordable and unwise—the latter in that it would end production of proven ship classes while investing large amounts in expensive, new, unproven designs: the DDG-1000 destroyer and the Littoral Combat Ship. Compared with the Administration’s request, H.R. 5658 significantly increases or decreases funding for most major shipbuilding programs. The bill denies the $2.5 billion requested in FY2009 to build a third ship of the DDG-1000 class. Instead, it adds to the budget a tenth ship of the LPD-17 class of amphibious landing transports ($1.7 billion) and $278 million to buy long lead-time components for use in two additional TAGE-class supply ships, designed to replenish warships in mid-ocean, that would be funded in FY2009. It also authorizes $400 million, which the Navy could use either to buy components that could be used to build an additional DDG-1000 or to resume production of the much less expensive DDG-51-class destroyers. HASC Seapower Subcommittee chair Gene Taylor has urged the Navy to use the funds to continue DDG-51 procurement. To buy two additional Littoral Combat Ships, the bill authorized $840 million rather than the $920 million requested, on grounds that the contractors could use components previously purchased for ships of this class that had been cancelled. The bill authorizes $722 million more than the $3.4 billion requested for acquisition of Virginiaclass submarines. The request would buy one sub in FY2009 and long lead-time components (including a nuclear powerplant) to be used in another sub slated for purchase in FY2010. The bill’s addition would let the Navy buy enough long lead-time components in FY2009 to allow the purchase of two subs in FY2010, thus accelerating by one year the time when the Navy could begin buying subs at the rate of two per year. Reflecting SASC’s concern that the Administration’s shipbuilding plan shows little progress toward meeting its avow [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/crs%3ARL34473. Public record. Not legal advice.