Navy FY 2019 Discretionary and IT Budget Request Snapshot

Posted by John Slye on April 13, 2018

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The Department of the Navy submitted a $194B FY 2019 discretionary budget, with $4.9B for unclassified non-national security information technology.

In early February the White House released its fiscal year (FY) 2019 budget request and the Department of the Navy (DoN), which includes the Marine Corps, accounts for the second largest total discretionary and information technology (IT) budgets among the four Department of Defense (DoD) components.

The new budget sustains strong growth for the Navy and the other defense components in the midst of the FY 2018 budget uncertainty that comes with multiple Continuing Resolutions (CR) and ongoing negotiations on budgets for the remainder of this fiscal year.

A new budget and the year-to-year changes reflect adjusting priorities and efforts in the proposed budget. Normally, I would look at the changes from FY 2018 to FY 2019, but due to the uncertainty of the FY 2018 budget data that the Office of Management and Budget (OMB) provided, (i.e. the impacts of being under a CR), I chose to base the growth comparisons on FY 2017.

Total Discretionary Funding and Priorities

The proposed FY 2019 budget provides $194.1B in total discretionary budget authority to the Navy and Marine Corps, a 15% increase over FY 2017. The Navy’s overall strategy seeks to combine capacity and capability and strengthen their global readiness posture.  

Navy discretionary funding highlights include:

  • Allocating $63.4B to O&M efforts, adding $8.6B vs. FY 2017. The budget increases funding for Combat Operations and Support ($34B), Training ($1.6B), and Force Mobilization ($1.2B).
  • Supports innovation and advanced systems and component development activities through $18.7B in RDT&E funding, a $537M increase from FY 2017. Funding focuses on System Development and Demonstration ($6.0B), Operational Systems Development ($4.9B), and Advanced Component Development ($4.3B).
  • Procurement sees a $10.7B increase over FY 2017 to reach $58.5B. Procurement priorities support tactical combat platforms and missions systems as well as core communications capabilities like CANES ($478M), Fixed Surveillance System ($295M), Shipboard IW Exploit ($221M), and Navy Multiband Terminal (NMT) ($114M).
  • Overseas Contingency Operations (OCO) funding priorities are dominated by field readiness O&M activities over procuring new capacities. The budget allots $15B for DoN OCO, 5.2B over FY 2017.

Navy Total IT and New Development Budgets

Public visibility into the DoD IT budget has been slowly but surely decreasing over the last several administrations, as an increasing proportion of this spending has been shrouded behind classified programs and budgets. For FY 2019, OMB no longer allows unclassified IT systems categorized as “National Security Systems” (approximately $17.3B in the FY 2019 request) to be publicly viewable. The net result for FY 2019 is that the Navy and Marine Corps is requesting a combined $4.9B for IT in FY 2019.

The FY 2019 IT budget of $4.9B would be a nearly $800M (~20%) increase over FY 2017 and if the FY 2018 estimate is accurate then we’re still looking at an increase, although a more modest one at $161M. The $331M increase in DME budget from FY 2017 to FY 2019 is an even larger relative increase (+115%) than the total budget bump and while a FY18-19 comparison again is a much more modest +$127M, that represents a 26% increase. (See table below.)

Noteworthy IT Programs

Looking further into the Navy’s IT budget investments and initiatives provides some vision into their current priorities and future direction. Here are a few initiatives that stand out among others due to relative size, budget growth, and/or proportion of new development spending. IT funding highlights include:

  • Navy Enterprise Resource Planning – Enables faster, more accurate responses to the needs of the warfighter, sharing authoritative information across functional communities to improve Enterprise performance. At $182M for FY 2019 the Navy’s single largest IT investment (other than $184M in transfer payments to DISA) sees a +68% increase over FY 2017 levels. This investment is designated as 100% O&M spending.
  • Base Communications Office (BCO) – Supports base desk phones, cell phones, pagers, calling cards, fax and modem lines, video teleconferencing, audio conferencing and toll free telephone services. BCO receives $161M for FY 2019, of which 34% ($55M) is DME. The initiative grows by 31% over the FY 2017 level.
  • Navy Maritime Maintenance Enterprise Solution – NMMES is consolidating overlapping applications and databases, data centers, and infrastructure into a fully integrated enterprise solution. The investment requests $125M for FY 2019, an increase of $74M (+146%) over FY 2017. DME accounts for $22M (18%) of the FY 2019 budget.
  • Navy Standard Integrated Personnel System – NSIPS will deliver field-level pay and personnel data to update corporate databases in peacetime, recalls, and partial and full mobilizations. At $112M for FY 2019 the investment includes $60M (54%) DME funding. Overall, the initiative’s budget increases more than $68M (+157%) over FY 2017.
  • Network On The Move – NOTN leverages equipment solutions common to the Mobile Modular Command and Control (M2C2) fielded solution and the COBRA3 prototype enhanced with FMV receive capabilities. The FY 2019 request is for $100M, a $37M (59%) increase over FY 2017. DME accounts for 94% of this investment.

The final budget for the Navy and other defense and civilian departments will take months to hammer out in Congress, which is still working to finalize an FY 2018 budget half-way through the fiscal year. The general tone and expectation is one of budget increases for the DoD, but specific details on priorities continue to be negotiated.

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