The defense appropriations shuffle

Walter Pincus
Reporter August 26, 2013

Just how many extra billions of dollars are still floating around inside the Pentagon that the Senate Appropriations Committee is able to move staggering amounts from one program to another?

It’s just one of the questions raised by a reading of the committee’s 248-page report on the $587 billion fiscal 2014 defense appropriations bill.

Walter Pincus reports on intelligence, defense and foreign policy for The Washingon Post. He first came to the paper in 1966 and has covered numerous subjects, including nuclear weapons and arms control, politics and congressional investigations. He was among Post reporters awarded the 2002 Pulitzer Prize for national reporting. View Archive

Here’s the first $1.2 billion the committee says it found: With personnel reductions underway, the Pentagon at the end of fiscal 2013 will have 11,660 fewer civilian employees than it had planned.

“Considering that the fully-burdened average salary of Department of Defense civilians is approximately $100,000 that could mean an overstatement of about $1,200,000,000 in the operation and maintenance accounts based on the overestimation of civilian [full time employee] levels at the beginning of fiscal year 2014,” the report says.

Therefore, “The Committee recommendation includes an overestimation reduction.”

Caution: The committee’s recommendations must be approved by the full Senate, the House and in the final bill signed by President Obama before they become law. Still, the committee’s exercise reveals much about the budget process.

Here’s another quick $491 million that the committee credits to the Government Accountability Office: “A GAO analysis of past year obligation rates shows that the services continue to underexecute their military personnel accounts.” In civilian language that means it does not have as many military personnel to pay as it thought it would, and therefore has an excess of money in its military personnel acounts. “Due to excess unobligated balances, the Committee recommends a total reduction of $491,239,000 from the fiscal year 2014 military personnel accounts.” Done.

How about a smaller savings, just $294 million? This time the committee said the Pentagon overestimated the costs of moving service personnel and their families from one place to another, called Permanent Change of Station (PCS).

Past legislation required a report “on potential efficiencies in the PCS program,” according to the committee. But the panel didn’t wait for that report. The committee “believes savings can be realized in the fiscal year 2014 PCS program and recommends a total reduction of $294,265,000 across the services’ operational and rotational base budgets.”

In just those three moves the committee cut $2 billion from the Pentagon’s original request. But of course that doesn’t mean money saved.

Does the committee have some costly programs it wants to fund that the Obama Pentagon does not?

How about $2.4 billion to keep those seven Ticonderoga-class guided-missile cruisers and two amphibious dock-landing ships that the Navy last year wanted to retire early to save $4 billion over the next five years. Yes, the cruisers have many service years ahead, but the Navy has claimed it would be expensive to upgrade them to have ballistic-missile-defense capability, which is what such ships will be used for.

Congress, for its own reasons, ignored the request last year and apparently is doing it again this year. The Senate panel wants the $2.4 billion “to man, operate, sustain, upgrade and modernize” these nine ships with the funds available through Sept. 30, 2021.

Proving it’s not messing around, the committee “directs the Secretary of the Navy to upgrade at least one of the . . . cruisers starting in fiscal year 2014.”

The committee also shows how it supports Joint Chiefs Chairman Gen. Martin Dempsey’s plan to reduce the number of general and flag officers by 144 over the next five years.

It asks the GAO to lay out both direct and indirect costs of generals and flag officers, including not just their pay and allowances but also “the direct costs of all officers and enlisted aides assigned to or supporting general or flag officers; the travel and per diem costs of such aides, the annual expenditures for military housing provided to general and flag officers and executive healthcare.”

To show it is not kidding, the committee cut $8 million from next year’s Pentagon appropriation saying, “The reduction shall be applied to funding for general and flag officers,” and wants the defense secretary to report on how the reduction is being applied 90 days after the spending bill is approved.

A continuing problem in the development and procurement of new weapons and equipment in the technologically changing world is a tendency on the part of the services to begin production before their internal systems or prototypes are fully tested.

The committee’s report shows that concurrency problem in different ways.

Take the Army’s plan to modernize the Patriot air-missile defense system. The Army wants $70 million next year to continue research and development, along with $256 million for procurement.

However, the panel notes that while the Army has updated requirements for the modernized system, it only vaguely describes “specific technologies required, development and fielding schedules.”

Costs are estimated at near $2 billion over the next five years, plus an additional $800 million in the years beyond. Yet the committee says the Army doesn’t have plans to “harvest developed technologies from programs terminated by the Army for use in the Patriot Modernization program.” Those were ended after spending roughly $6 billion.

The committee’s solution is to withhold half the Army’s Patriot 2014 funding until the service comes up with an organized program.

When it comes to the F-35 Lightning II joint-strike fighter, the Pentagon’s most expensive weapons program, the committee recognized its concurrency problems with new aircraft in production while problems continue with developing software to go into the plane, along with reliability issues with systems already in place.

Yet the panel actually increased funding for aircraft in the current Air Force production plan. But looking forward, it called “unaffordable” the next major block of aircraft, which is projected after 2015 to cost $3.8 billion. Instead, the committee called on the Defense Department to review the future Air Force tactical fighter mix and see whether the planned 1,763
F-35s are needed, where “less capable aircraft may be effective and more cost-effective to operate and maintain in other less contentious scenarios.”

The committee report is not all criticism. The panel praised the Air Force for hiring people with severe disabilities to scan and digitalize millions of personnel records. Since they might otherwise be receiving Social Security disability benefits, the panel said, this allows them “to find sustainable employment and achieve self-sufficiency, while ultimately achieving substantial taxpayer savings.”

The Senate might vote on next year’s defense appropriations bill when Congress returns next month. More likely, 2014 funding of the Pentagon will get tangled up in whatever negotiations take place to avoid a government shutdown and/or increase the debt limit.

For previous Fine Print columns, go to washingtonpost.com/fedpage.

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