The House of Representatives yesterday passed the FY2012 Defense Authorization bill, 322-96, after considering more than 150 floor amendments.  The House bill authorizes $553 billion for the Department of Defense (DoD), equal to the administration’s request, and $119 billion for overseas contingency operations in FY2012.

The House bill approves the 1.6 percent military pay raise proposed by the president and authorizes requested troop strength levels.  The bill includes a small increase in the TRICARE Prime fee, but caps future increases at no more than the cost-of-living adjustment.  It also would prohibit annual pay increases for federal civilian employees who receive a “below satisfactory” performance rating. 

The bill supports DoD’s request for most major weapons programs.  It authorizes building 10 ships and approves requested funding for all major aircraft procurement programs.  However, the bill does add $153 million for Bradley Mods and $272 million for Abrams tank upgrades and increases requested funding for the Ground Based Midcourse Defense program by $100 million.  The bill also would increase funding for Special Operations Forces requirements.

The bill approves funding increases for a number of O&M programs.  It adds $1.3 billion for facilities sustainment, restoration, and modernization, increases funding for Army base operations by $230 million and adds funds for ship and aircraft depot maintenance and Guard and Reserve flight training.  However, to pay for these increases, the bill makes a $1.7 billion undistributed reduction to O&M accounts due to high unobligated balances. 

The House bill also includes a number of provisions related to DoD financial management oversight.  It would give DoD the authority to develop policies and procedures related to workforce management (Section 1061).  The House Armed Services Committee (HASC) has expressed concern that financial managers should not only have the necessary skills in fiscal concepts, but also a broader understanding of total force management and the budgetary impact of budget decisions.  In response to this concern, and to avoid adding another training track, the House bill directs the Under Secretary of Defense (Comptroller) and the Under Secretary of Defense (Personnel and Readiness) to consolidate multiple training development programs into a department-wide development strategy for financial management personnel.

The bill would also require DoD’s Chief Management Officer (CMO) to identify the number of financial management personnel and the necessary financial and budgetary skills (Section 1063) for a competent and effective workforce.  It would require the Under Secretary of Defense (Comptroller) and the Under Secretary of Defense (Personnel and Readiness) to develop guidance for the DoD CMO and the CMO of each military department to assess financial management personnel competency.  This assessment would identify requirements needed to perform financial, budgetary, and accounting processes and to maintain certification standards, and list any skill gaps with proposed action to correct these gaps.

The House bill would also require DoD to include specific lines in the budget for execution of the Financial Improvement and Audit Readiness (FIAR) plan (Section 1066), develop performance metrics to measure progress, and prepare strategies to mitigate failure to meet set deadlines

Even though the bill approves the funding level requested by the president and much of the requested program, it also contains three provisions the administration opposes so strongly that the president has threatened to veto a final bill if they are included.  The veto threat covers provisions in the bill that fund an alternative engine for the F-35 (Joint Strike Fighter), restrict the president’s authority to implement the START Treaty, and place restrictions on the transfer of Guantanamo detainees.

The Senate will take up the bill this summer.