The Pentagon's procurement request for Fiscal 2009 is down nearly 6 percent while research, development, test and evaluation is up slightly in the Bush administration's defense budget released today.

Modernization dollars declined while operations and maintenance and military construction were up. Programmatic details are expected to emerge during separate briefings later today with top budget leaders at the Pentagon.

The administration's topline request of $515.4 billion, plus a $70 billion placeholder for an emergency supplemental to continue funding the wars in Iraq and Afghanistan, had been expected. It was the 11th straight year the U.S. defense budget request has increased, according to budget analyst Steven Kosiak of the Center for Strategic and Budgetary Assessments.

For FY 2009 the Bush Administration is asking Congress for $104.2 billion for procurement, down 5.7 percent from Fiscal 2008's $110.6 billion. And RDT&E was up about 3 percent, $79.6 billion, from $76.5 billion in 2008. The Fiscal 2009 request seeks $17.3 billion to recapitalize aging Air Force, Navy and Marine Corps aircraft; $7.5 billion for mine-resistant vehicles for the Army and Marine Corps; and $5.7 billion for Special Operations Command.

The White House Office of Management and Budget reports that among the procurement highlights are funds to continue "investments in the aerial refueling and cargo airlift fleets," as well as $1.8 billion "to continue development and procurement of major unmanned aerial vehices to conduct a wide variety of combat and military support missions, thereby significantly reducing the risks to U.S. forces." There's also $12.7 billion to continue work on the CVN-21 aircraft carrier, Virginia-class submarines and DDG-1000 destroyers.

There's also a $300 million boost for efforts aimed at securing computing networks and defense information.

Still, overall, notes defense budget analyst Jim McAleese of McAleese & Associates, the actual FY 2009 procurement request is about $6.3 billion less than had been projected during the FY 2008 budget request cycle, and the RDT&E accounts have only been partly adjusted to accommodate that shortfall. That leaves the combined FY 2009 Investment Accounts request at $184 billion, or about $3.9 billion less than projected last year.

"A smaller-than-expected procurement request is slightly negative for defense" companies, adds UBS Securities analyst David Strauss, "although we will wait for full details of cuts relative to last year's forecast." UBS was encouraged by the strong outlay growth, 10% during this fiscal year and 12% in FY 2009.

Links To Budget Materials:

Press Release: Defense Budget (pdf)

Army Budget Documentation

Navy Budget Documentation

Air Force Budget Documentation

Defense-Wide Budget Documentation

Procurement Programs (P-1) (pdf)

Research, Development, Test & Evaluation Programs (R-1) (pdf)