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Shyu: Temporary Funding Benefits Army Acquisition


The U.S. Army's top weapons buyer said temporary funding keeping the government open until December is actually a good thing for the service's weapons acquisition programs.

Congress passed the short-term measure, known as a continuing resolution, or CR, last month to fund government agencies, including the Defense Department, through Dec. 11, at which point lawmakers will need to take another similar step or pass a full-year budget.

"It's quite ironic, but in this fiscal environment we're living in, in which annual base budgets are declining, CR turns out to be great because I can spend what I was authorized last year, right, as opposed to this year, in which inevitably my budget is going to be cut ," Heidi Shyu said at last week's annual conference in Washington, D.C., organized by the Association of the United States Army, an Arlington, Virginia-based advocacy group.

"So we're not significantly impacted by the current CR," she added. "No major programs impacted by that."

Lawmakers regularly use such resolutions to keep the government running when they can't agree on a spending plan for the fiscal year. In 2013, Congress couldn't even agree on a temporary funding measure and the government was forced to shut down for 16 days, forcing hundreds of thousands of Pentagon workers and other government employees to take unpaid leaves of absence known as furloughs.

Under the current continuing resolution, funding for programs is based in the fiscal 2014 levels. And while the money can't be used to start new acquisition, or modernization programs, the resolution includes provisions to address national-security priorities, including funding to train and equip moderate Syrian opposition forces, deploy U.S. troops to West Africa to help contain the Ebola outbreak, and to continue to level sanctions against Russia for its military involvement in the Ukraine, according to the White House.

Shyu didn't specify what share of the estimated $66 billion in Pentagon budget cuts the Army will bear over the next five years. But she said the automatic, across-the-board spending reductions, known as sequestration, if they continue, will delay and increase the cost of buying and upgrading equipment.

"What will happen is, everything gets stretched out," she said. "The requirements for the systems are still there. That means, it takes us longer and longer to procure the quantity we need. It is an incredibly inefficient way to do business because when you buy less quantity of anything -- guess what? -- cost goes up."

In fiscal 2014, which ended Sept. 30, the Army was authorized to spend $168 billion, including a base budget of $125 billion and a war budget of $43 billion, according to budget documents. For fiscal 2015, which began Oct. 1, the Army requested a $120 billion base budget, about $21 billion, of 17 percent, of which comes from the procurement and research, development and test and evaluation accounts. It's not immediately clear how much of the Pentagon's proposed $59 billion in overseas contingency operations, or OCO, funding the service will receive.

Army acquisition priorities include the Joint Light Tactical Vehicle, or JLTV, to replace a portion of the Humvee fleet; various efforts to improve the battlefield connectivity and communications including the Warfighter Information Network-Tactical; and upgrading the helicopter fleet while reorganizing aircraft across the active- and Guard components.

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