The great debate on how continuing resolutions affect DoD

DOD officials said continuing resolutions can delay their ability to pay for goods or services and can lead to repetitive administrative tasks or incremental planning. We found DOD has practices to minimize the effects of this kind of funding. For example, the military services may postpone contracts or nonessential training early in the year—when they’re more likely to be under a continuing resolution.

That was from the GAO report, DOD Has Adopted Practices to Manage Within the Constraints of Continuing Resolutions. Here’s a response from Elaine McCusker and Emily Coletta:

GAO’s conclusion itself – that DOD is largely able to mitigate the effects of routine CRs – seems unintentionally misleading. The DOD has operated under these improvised measures for 11 of the last 12 fiscal years. While it is unfortunately true that CRs have become routine, it does not mean they are benign… General John E. Hyten, vice chairman of the Joint Chiefs of Staff, recently stated that “stability in the budget will create more than 5 percent efficiencies every year.” With a budget of $715 billion, saving 5 percent means regaining almost $36 billion in buying power.

 

… Second, the GAO discussion of the harmful effects of CRs continually leads to explanations of how DOD has been able to mitigate them instead of noting the consequences of program delays and incremental funding… Third… Looking only at quarterly execution rates, as the GAO does, misses the impact of unpredictable funding and incremental contracting… Fourth, the GAO did not look at the CRs’ impact on the defense industry.

And Elizabeth Fields from the GAO fired back in another The Hill article:

Elaine McCusker and [Emily] Coletta targeted and generally mischaracterized our recent report (GAO-21-541) on how the Department of Defense (DOD) operates during continuing resolutions (CR)… Our first key point is that there are clear effects of CRs on DOD… For example, in FY18 (a CR year), the Navy obligated only 19 percent of its RDT&E appropriations during the first quarter of the year, compared to 46 percent of those appropriations during the first quarter of FY19 (a non-CR year).

 

… We analyzed each of the 254 Selected Acquisition Reports the military services submitted to Congress for fiscal years 2017 through 2019… Of the 254 reports, we identified seven that explicitly cited CRs as posing risks, such as delays and cost increases. When we met with officials, however, we learned that the CRs did not have their predicted effects on these seven programs. We further listed the ways in which DOD managed to avoid the potential problems and cited officials’ continued concerns.

I will say a couple things. First, the highlights of the GAO report certainly give the impression that continuing resolutions do not have a huge impact, and that is the only section most people will read. Second, measuring funds obligation rates (e.g., 46 percent RDT&E obligated vs. 19 percent in the first quarter) is interesting but says nothing about military impact. And third, MDAPs are some of the most insulated programs from continuing resolutions, and their Selected Acquisition Reports are not likely to mention CR impacts even if they occurred. I think this is a classic case of analyzing accessible data rather than useful data.

Mackenzie Eaglen provides a more relevant analysis of the CR impacts for FY 2022 by digging into the budget justification docs for New Starts that will be delayed three or six months:

For example, here are select programs from the Army’s list of new R&D efforts that will be negatively affected by a continuing resolution this year.

• $5 million for Long Range Maneuverable Fires (LRMF) Technology
• $11 million for applied research projects that focus directly on “capability enhancements” for soldiers and squads
• $18 million for All Domain Convergence and Advanced Technology
• $8 million for Mobile & Survivable Command Post (MASCP) Advanced Technology
• $16 million for Assured PNT Communications Advanced Technology

Even though the Army does not report a list of new procurement programs, the service’s budget materials will frequently highlight when a given program constitutes a new start. Here is a sample of Army procurement efforts slated to begin in this fiscal year, reflecting a range of cost and type:

• $35 million for Lower Tier Air and Missile Defense (LTAMDS)
• $287 million for Mobile Protected Firepower (MPF)
• $80 million for Vehicle Protection Systems (VPS)
• $24 million for new rifles as part of the Next Generation Squad Weapon program element
• $8 million for the Joint Tactical Ground Station (JTAGS) – Intel
• $2 million for the Enhanced Portable Inductive Artillery Fuze Setter (EPIAFS)
• $12 million for the Improved Forward Looking Infrared (IFLIR) B-Kit
• $60 million for the Counter-Small Unmanned Aircraft Systems (C-sUAS)

The Air Force reportedly requested 16 new start procurement programs in its FY22 budget, accounting for $2.3 billion of its budget request for the current fiscal year. This likely includes:

• $108 million for the B-21 Raider, Advance Procurement
• $10 million for the Advanced Trainer Replacement T-X
• $61 million for Distributed Aperture Infrared Countermeasures (HH-60W Modifications)
• $24 million for the SLC3S-A Enhancements effort (modifications to test new communications technologies)
• $15 million for the Massive Ordnance Penetrator (MOP)
• $11 million for the Ground Based Strategic Deterrent (GBSD)
• $161 million for the AGM-183A Air-Launched Rapid Response Weapon (ARRW)

Parsing through the Air Force’s research and development programs for new starts in the FY22 request is tricky. For example, the Air Force buckets hypersonic prototyping efforts under a single program element, but new projects are scheduled to be funded within that basket this fiscal year. Still, some Air Force new start R&D efforts are clear:

• $200 million for the Hypersonic Attack Cruise Missile (HACM)
• $42 million for the Tactical Multi-Mission Over the Horizon Radar (TACMOR), intended to provide “enhanced Air Domain Awareness in the INDOPACOM area of responsibility”
• $1 million for the Global Positioning System Interface Unit (GPS-IU) as part of the research and development effort supporting B-52 squadrons
• $37 million for a Spectrum Warfare Attack Capability project
• $7 million for a Command and Control, Incident Management, Emergency Response Application (C2IMERA)
• $40 million for Enhanced Anti-Jam Military Code Global Positioning System (M-Code EAJ) receivers
• $15 million for a Joint Transportation Management System (JTMS) aimed at transportation and transportation-related financial business process reform (with a range of other affiliated projects)

Obviously, the Navy, Marine Corps, and Space Force will not be exempt from the disruptions facing the Army and Air Force.

HT on all this: Pete M. The last thing I’ll say is that with budget portfolios that outline major organizations or capabilities and increasing new start authorities, most of the problems stemming from CRs would disappear overnight. These self-imposed problems of the PPBE simply did not exist prior to the 1960s.