I talk a lot about budget portfolios and PPBE reform on this blog. Today’s excessive detail in the defense budget requires long planning timelines. By the time defense officials begin executing the budget programmed from two or more years before, inevitably a misallocation of resources will be exposed. There could be contract delays, emergency situations, political factors, unexpected inflation, new technologies, evolving threats, and any number of fact-of-life changes.
While budget portfolios provide flexibility for timely cost-schedule-technical tradeoffs within the confines of the portfolio, another way to get to execution flexibility is to increase reprogramming. Reprogramming allows defense officials to move funding between budget line items, but there is very limited opportunity to do so. When reprogrammings go above thresholds, or cross appropriation accounts, then four congressional committees need to give their prior approval.
When congressional prior approval is required, an above threshold reprogramming (ATR) request must first seek up to 12 layers of approval in the defense bureaucracy. After it gets out of the Pentagon and through OMB, Congress can takes another 45 days to respond on average. The Section 809 Panel found that the total time to approve an ATR ranges from four to six months. A Navy study found that between FY 2007 and FY 2018, the average ATR took 96 days and the longest was 236 days.
Download the ATR data here: Reprogramming over time.
In the chart below, I compiled data on annual prior approval ATRs from six different sources and stitched them together. Over the 2001-2019 period, total ATRs ranged between $2 billion and $21 billion, providing DoD the ability to flex between 1% and 3% of the total budget. You’ll notice a large spike in FY 2008 up to 3%, which coincides with the 2007-2008 Iraq Surge.
As occurred in the Vietnam War, the Global War on Terrorism was initially funded out of supplemental requests. Reprogrammings are relied upon a little more during the middle of a conflict when enough dollars have been appropriated, but perhaps to the wrong accounts.
As the Global War on Terrorism has wound down in the late 2010s, ATRs have fallen from $10.3B in FY2013 to just $4.49B in FY2019, representing just 0.6% of the total DoD budget.
Reprogrammings that DoD can make on its own without congressional prior approval, called Below Threshold Reprogrammings, add between $1B and $2B a year in additional flexibility.
The most obvious thing from the ATR chart over time is that between FY 1961 and FY 1971, DoD reprogrammed quite a bit more — between 2% and 8% of the DoD budget. Former DDR&E Harold Brown in remarked that 20% of the entire FY 1961 RDT&E title was reprogrammed. “These actions are instituted by and large by the services,” Brown said. “They are reviewed by the Secretary of Defense Office—by me, as a matter of fact. By and large, they are passed and passed quickly.”
Download the ATR data here: Reprogramming over time.
At the time, most reprogramming actions were actually BTRs and submitted to Congress for a 15-day notification where Congress could deny the reprogramming. Those actions requiring prior approval of Congress were: (1) items or activities omitted or deleted by the Congress; (2) items or activities for which specific reductions in amounts originally requested were made by the Congress; and (3) any increases in procurement quantity of aircraft, missiles, or naval vessels.
It wasn’t until an August 2000 update to the Financial Management Regulation that actions which had required congressional notification were changed to require prior approval from the four congressional committees. This means that the overall decline in reprogramming flexibility is greater than the above chart suggests.
The first time “reprogramming” appeared was in FY 1956, but didn’t take its more modern form until FY 1961.
In FY 1972, after the Nixon impoundment demolished the trust between Legislative and Executive branches, Congress started bringing ATR committee hearings into the public and severely cut back on approvals. This severe restriction on reprogramming seemed to continue until the Global War on Terrorism.
This is only the most bare outline of Reprogramming authorities in DoD and how they changed over time. A lot more can be found in my 2022 Naval Postgraduate School paper [available here].
But my punchline is that increasing reprogramming actually doesn’t solve the problem inherent to DoD acquisition. The whole point of PPBE was to spend years analyzing a problem, select the single best solution, and execute to the baseline plan over the following decades. If reprogrammings are arbitrarily increased, then what was the point of PPBE, the program structure, and multi-year analyses in the first place? 50 layers of approval and thousands of pages of documentation were a waste of time.
DoD needs a management structure that has modularity, iteration, speed, and competition built in from the start — not haphazardly provided for through reprogrammings. Portfolio management is the right long-term goal for agile acquisition. Increased reprogrammings can be a stepping stone to get there, but never the ultimate solution.
Reprogramming Actions Requiring Congressional Prior Approval
Reprogramming: Moving funds between authorized elements, but above appropriation-specific thresholds. Also, whenever procurement quantity is increased or a congressional special interest item is affected. FY 2022 thresholds:
- RDT&E: $10 million or 20%* of a program element
- Procurement: $10 million or 20%* of a budget line item
- O&M: $10 million of a budget activity or defense agency
*whichever is less
Transfers: A reprogramming action of any size that crosses appropriations. Internal reprogrammings that do not change the intent of a budget line item may use transfer authority, but do not require congressional prior approval. The FY 2022 cap on cumulative transfers:
- General Transfer Authority: $4.0 billion
- Specific Transfer Authority: $2.0 billion
New Starts/Terminations: A new start is a BLI or major component thereof not previously justified in the President’s Budget submission. Terminations are when an authorized program’s funding is zeroed out. Below the threshold, new starts and terminations only require a letter notification to Congress. FY 2022 thresholds:
- RDT&E: $10 million for entire effort
- Procurement: $20 million for entire effort
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