October 30 Pentagon Budget Refresher: Budget Deal and Defense Authorization

By Sarah Tully

Budget Deal

On October 26, congressional leaders announced a two-year budget deal to increase discretionary spending caps for defense and non-defense spending for Fiscal Years 2016 and 2017. The bill also suspends the debt limit until March 15, 2017.

The deal raises defense spending by $25 billion over the caps set by the budget control act for Fiscal Year 2016, and $15 billion for Fiscal Year 2017. It also provides $59 billion for the Pentagon portion of the Overseas Contingency Operations account. OCO for non-defense, that is, the 150 Foreign Affairs account, gets $15 billion under the deal, for a total of $74 billion for OCO.

The initial version of the bill implied that the OCO levels were to be used as a floor, not a cap, which implied that OCO spending could increase; however, a House rules amendment struck the words “no less than” in reference to OCO.

The $59 billion for OCO under the Budget Deal is $5 billion less than the $64 billion for OCO appropriated in FY 2015. The $15 billion for State Department OCO is $6 billion more than the $9 billion appropriated in FY 2015.

The major significance of the deal for appropriations: the Appropriations committees now know the budget ceilings for the next two years and can begin getting the Appropriations Bill process unstuck. It is expected that those committees will now negotiate a gigantic Omnibus Appropriations Bill for fiscal Year 2016 – packaging together 12 bills into one measure.

To recap:

Budget Deal

FY 2016 Base Budget: $548 billion

FY 2016 050 (defense) OCO: $59 billion

FY 2016 150 (foreign affairs) OCO: $15 billion

The House passed the bill by a vote of 266-167 on October 28. Just after 3am on October 30, the Senate approved the agreement, by vote of 64-35.

Congress has until December 11 to put together a new spending agreement for FY 2016; on that date, the Continuing Resolution runs out.


Defense Authorization Bill (new information in italics)

On May 15, the House approved the FY 2016 National Defense Authorization Act (NDAA) by 296 to 151. Before the final vote, the House considered 135 amendments, but the Republican leadership refused to permit votes on many key amendments. On June 18, the Senate approved the authorization bill 71-25. Of the 600 amendments filed, only 58 were voted upon. There were many speeches and quorum calls and not much action.

Next came three months of on-and-off negotiations on a House-Senate conference agreement. Certain provisions on torture, the Guantanamo Bay prison, Tricare co-pays, the huge increase in the Overseas Contingency Operations account (OCO), and of course, protection of the Sage Grouse (click here to watch the bird’s terrifying mating dance), held up the negotiations.

The conference report was agreed to on September 29. It includes $38 billion over the president’s request for the Overseas Contingency Operations (OCO) account, an expansion of various missile defense systems, restrictions on funding to dismantle retired nuclear weapons, and hundreds of other policy provisions. See our side-by-side comparison of House, Senate and Conference versions of the defense authorization billhere.

Many Democrats on the two Armed Services committees refused to sign the Conference Report because while defense would be getting a hefty increase, domestic programs would not.

On October 1, the House agreed to the Conference Report by a vote of 270-156. Ten Republicans and 146 Democrats voted against the measure. On October 7, the Senate agreed to the Conference Report by a vote of 70-27. Republican Senators Cruz and Paul joined 25 Democrats in opposing the report.

The president wanted equal increases above the spending caps for both Pentagon and domestic programs. As a result, he vetoed the NDAA on October 22 because of the unequal increases and the continued use of OCO as a budget gimmick, among other issues.

This was the fifth time in history the defense bill has been vetoed – most recently by President George W. Bush in 2008 over an Iraq policy issue.

Since this is a bill that originated in the House, it will vote before the Senate on a veto override, should it choose to do so. Now that a budget deal has been reached, there are a few paths forward for the NDAA, which authorized $5 billion more than the budget deal allows for: the House could continue to seek to override the veto, they could come up with stand-alone bill that finds $5 billion in savings, or, it could be rolled in with an omnibus appropriations measure that must be approved by December 11, when the current continuing resolution expires.