Congress Releases FY19 Defense Policy Bill

by Shaun McDougall, Military Markets AnalystForecast International.

USS John C. Stennis (CVN 74) and USS Ronald Reagan (CVN 76) conduct strike group operations.
Source: U.S. Navy

U.S. House and Senate lawmakers completed the conference markup of the FY19 defense authorization bill on July 23.  The defense policy bill adheres to the spending levels agreed upon in the bipartisan budget act, providing a defense base budget of $639.1 billion.  That figure comprises $616.9 billion in discretionary funding for the Department of Defense, $21.9 billion for nuclear programs in the Department of Energy, and around $300 million for defense-related activities outside the DoD.  Another $69 billion is provided for Overseas Contingency Operations, for a total of $708.1 billion in discretionary defense spending.  When including $8.9 billion in mandatory spending, the FY19 topline authorized in the legislation totals $717 billion.  The separate congressional appropriations process will finalize how much money the military actually has available to spend in FY19.

The authorization bill adds funding for training, in part to increase readiness, but also to address the recent aviation and sailing mishaps that have resulted in loss of life.  The bill goes even deeper into recent ship collisions, and includes provisions that address maritime logistics and training, including requiring the Navy’s Board of Inspection and Survey inspections to be conducted without notice.

Furthermore, lawmakers continue to back increasing the size of the Navy fleet, which could reduce pressure on currently deployed assets.  To that end, the bill supports accelerated construction of the fourth Ford class aircraft carrier, CVN 81, funds two additional Littoral Combat Ships, and supports options to build two additional Virginia class submarines in FY22 and FY23.  The legislation also adds $750 million “to more efficiently procure destroyers and amphibious ships,” authorizes construction of six Polar icebreakers, adds $250 million to replace a cable-laying vessel, and adds funding for three additional LCAC 100 Ship-to-Shore Connectors.  The bill authorizes multiyear procurement of Super Hornets and E-2D aircraft, and adds $161.5 million for an additional E-2D in FY19.

The agreement calls for the Air Force to sustain its legacy E-8C Joint Surveillance Target Attack System (JSTARS) aircraft until the follow-on Advanced Battle-Management System concept is further developed.  House and Senate policy bills passed earlier this year differed in their response to the Air Force’s decision to terminate the JSTARS recapitalization program, with the House mandating the continuation of the recap program and providing $623 million for the effort.  That mandate did not make it into the final policy bill.

The conferees support the DoD’s budget request for 77 F-35 aircraft, but authorizes the department to procure additional aircraft should additional funds become available as a result of cost savings and program efficiencies.  Earlier this year, the House Appropriations Committee proposed adding 16 F-35s to the FY19 defense spending bill, while the Senate added 12 aircraft to its markup.  The conference bill also prohibits delivery of F-35 aircraft to Turkey until the DoD submits a report to Congress assessing relations between Turkey and the U.S., Turkey’s participation in the F-35 program, and the operational and counterintelligence risks posed by the deployment of the S-400 air and missile defense system.  The provision stems from concerns over Turkey’s planned purchase of the Russian S-400.

Lawmakers continue to stress the importance of modernizing the A-10 fleet, and add $65 million for A-10 wing replacements.  The legislation also directs the Air Force to consider using multiyear procurement contracts to generate better cost savings for the program.  The legislation also authorizes multiyear procurement of the C-130, and adds $129 million for engine upgrades for older C-130 aircraft. The bill blocks spending on recapitalizing OC-135B Open Skies aircraft until the president makes certain certifications, including that Russia is taking steps to return to compliance with the Open Skies Treaty.  The Air Force also receives an additional $105 million for one EQ-4 unmanned Battlefield Airborne Communications Node (BACN) aircraft.

Critically, the bill does not move forward with the president’s recommendation to create a separate Space Force for military space programs currently run by the Air Force.  Instead, the bill establishes a subunified command for space under U.S. Strategic Command responsible for joint space warfighting.  There has been some resistance to the Space Force proposal, particularly from the Air Force.

The bill increases funding for Stryker A1 vehicles, helping the Army achieve its ultimate goal of upgrading the entire Stryker fleet with double-V hulls.  The legislation also adds $168 million for an additional six AH-64E new-build helicopters, $85 million for UH-60M Black Hawk helicopters, and $110 million for Paladin self-propelled howitzers.  Another $60 million is added to increase MQ-1C Gray Eagle capabilities.

The conference agreement adds $140 million to the Missile Defense Agency budget for directed energy, space sensing, and hypersonic defense projects, as well as $284 million to accelerate the integration of Patriot and Terminal High Altitude Area Defense (THAAD) systems.  The bill requires the MDA to establish a boost phase intercept program using kinetic interceptors.  The boost phase is the ideal time to defeat a ballistic missile, but also the most difficult due to the short amount of time available and the close proximity to the launch site required to hit the missile during launch.  The MDA is also required to continue development of the homeland defense radar in Hawaii, and to ensure the radar is operational by FY23.

The conferees also support the Nuclear Posture Review’s recommendations to develop a lower-yield ballistic missile warhead to bolster deterrence, and to provide funding to accelerate modernizing the Ground Based Strategic Deterrent and Long-Range Standoff cruise missile.  The bill also adds $150 million to accelerate efforts to field a conventional prompt global strike capability before FY22.

The legislation authorizes a 15,600-troop increase as requested by the administration, resulting in active-duty end strengths of 485,741 for the Army, 331,900 for the Navy, 186,100 for the Marine Corps, and 324,720 for the Air Force.  The Senate had previously recommended a more moderate increase in order to put less pressure on modernization accounts.

As editor of International Military Markets, North America, Shaun has cultivated a deep understanding of the vast defense markets in the United States and Canada. Further, Shaun played an integral role in the development of Forecast International’s U.S. Defense Budget Forecast product, which offers an unprecedented level of insight into the Pentagon’s acquisition budget.

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