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What’s new in Washington, D.C. – It’s all about the budget

Thursday, March 08, 2018

“Budget,” the current buzz word in Washington, D.C., applies to both the Bipartisan Budget Act of 2018 and the president’s budget request for fiscal 2019.

On Feb. 9, Congress passed and the president signed, the Bipartisan Budget Act of 2018 (H.R. 1892), a two-year deal that raises discretionary caps for fiscal years 2018 and 2019 by $296 billion.

Defense spending caps will be increased by $80 billion in fiscal 2018, setting the cap at $629 billion.

Add the overseas contingency account and the total discretionary spending for defense will rise to $700 billion. For fiscal 2019, the caps will be increased by $85 billion, setting the cap at $647 billion.

With the overseas contingency account added, the topline for defense is $716 billion.

Non-defense discretionary spending caps will rise by $131 billion for fiscal years 2018 and 2019.

The Bipartisan Budget Act includes provisions that:

  • Extend the statutory debt ceiling through March 1, 2019;
  • Provide $6 billion over two years for anti-opioid and mental health efforts;
  • Extend authorization of the Children’s Health Insurance Program for the next 10 years;
  • Extend several tax breaks for one-year;
  • Authorize $7 billion in total funding for community health centers for two years;
  • Provide $89.3 billion in additional emergency funds for hurricane-affected communities;
  • Provide $20 billion for infrastructure projects such as surface transportation, rural broadband and clean water;
  • Provide $5.8 billion for Child Care Development Block Grants;
  • Provide $4 billion to rebuild veterans’ hospitals and clinics; and,
  • Provide $4 billion for college affordability programs.

The agreement included language that extends the current continuing resolution (CR) until March 23, the fifth CR Congress has enacted since the fiscal year began on Oct. 1.

This CR will keep the government running while House and Senate appropriators negotiate the details of an omnibus spending bill for fiscal 2018 which will reflect the new budget caps for both defense and non-defense accounts.

Details of president’s budget request for fiscal 2019 released

The president’s fiscal 2019 budget request, released Feb. 12, requests $686 billion for DoD, an $80 billion or 13-percent increase from 2017-enacted levels.

This includes $597 billion for the base budget, and $89 billion for the overseas contingency account.

According to the summary released with the budget, it will provide “the resources necessary to continue rebuilding military readiness which has been degraded by budget reductions imposed by the Budget Control Act and more than 16 years of warfighting.

The Army’s budget will grow by roughly 8 percent over fiscal 2018 levels.

That computes to roughly $13 billion over last year’s request of $166 billion.

“Increased funding for the U.S. Army would modernize existing forces, provide additional training for U.S. soldiers, and establish new security assistance brigades to support counterterrorism efforts abroad,” the budget summary stated.

The budget proposes to:

  • Fund critical ground combat capabilities including new investments in armored vehicles, long-range artillery, amphibious vehicles, rotorcraft, and munitions, accelerate the modernization of the Army’s armored brigades to four over the five-year window and add a 16th heavy brigade combat team.
  • Increase Army Active Duty troop levels from 476,000 to 487,500, an increase of 11,500 personnel. Both the Army Reserve and Army National Guard would see increases of 500 personnel – Army Reserve from 199,000 to 199,500, and Army National Guard from 343,500 to 344,500.
  • Provide a military pay raise of 2.6 percent.
  • Fund a full range of compensation programs from monthly incentive pays to recently expanded retirement benefits.
  • Support increased home station training and additional high-end collective training exercises, resulting in 20 combat training center rotations in 2019.
  • Sustain family support initiatives by investing more than $8 billion in spousal/community support, child care for 1 million children, counseling support such as financial readiness and Military OneSource; DoD Dependent Schools and commissary operations at 237 stores.
  • Increase ammunition production by investing $22 billion from fiscal 2019 through fiscal 2022. The $4.9 billion FY19 request for aircraft sustains AH-64 Apache, UH-60 Black Hawks and CH-47 Chinook helicopter re-manufacture and new build procurement.

For the first time in years, the president’s budget does not request any increases for the TRICARE military health system including the pharmacy program.

According to the budget documents, DoD will pursue “efforts focused on internal business process improvements and structural changes to find greater efficiencies (e.g., modernize military health care system to an integrated system).”

The bottom line: The president’s budget request is just that – a request and is only the first step in the budget process. Congress will ultimately make the final decision.

Whether or not they go along with the president’s request will not be revealed until they release the details of their defense authorization and appropriations bills later in the year.