As March 4th (the day the current FY2011 Continuing Resolution (CR) expires) approaches, the chance of a year-long Continuing Resolution (CR) is causing widespread angst in the defense community. Funding the FY2011 defense budget at the FY2010 level would mean a $23 billion cut to the president’s request, a much larger cut than assumed in the House Budget Resolution (-$13 billion). While many consider a year-long CR for defense is a remote possibility, there is much concern that the ongoing budget deadlock could produce such a CR by default. DoD and defense industry leaders have voiced strong objections to this possibility and have urged Congress to pass a separate DoD FY2011 appropriations bill.
Defense Secretary Robert Gates has warned that a $23 billion cut to the FY2011 DoD budget request resulting from a year-long CR is “the worst of all possible kinds of reductions.” According to Gates, it would lead to cuts in training and readiness and force program stretchouts that increase costs. In testimony before the House Armed Services Committee (HASC) last month, Deputy Secretary Bill Lynn told committee members that funding DoD at the CR level would produce a “drop in both effectiveness and efficiency” at a time when DoD is trying to improve both. Military Service leaders have warned that funding their programs at the FY2010 level would force costly delays and possible cancelations of systems needed to support operations in Afghanistan. They also argue that such a drastic funding cut would delay necessary maintenance of ships and aircraft, refurbishment of vehicles and equipment, and many construction projects. Defense industry leaders also joined the criticism telling congressional leaders that a full-year CR for DoD would cause severe problems for defense-related U.S. employment because of program disruptions.
Despite the growing distress being felt by DoD and other federal agencies from the continuing uncertainty, Congress does not appear to be rushing to reach a final decision on FY2011 appropriations. In the Republican-controlled House, Rep. Paul Ryan (R-MN), chair of the House Budget Committee, set a total FY2011 federal budget level at $1.055 trillion that assumes a $58 billion cut to non-security budgets and a $16 billion cut to security budgets ($13 billion from defense). House Appropriations Committee (HAC) chair Rep. Harold Rogers (R-KY) hopes to take an appropriations bill to the floor that supports these amounts. But even with a Republican majority, House passage is not certain. Some Republicans are pressing for even more non-security budget cuts to meet their stated goal of a $100 billion budget reduction in FY2011. In the Democrat-controlled Senate, Senate Budget Committee (SBC) chair Sen. Kent Conrad (D-ND) has not yet announced the details of his plan. Senate Appropriations Committee (SAC) chair Sen. Dan Inouye (D-HI) will have to distribute the budget total among the 12 appropriations bills and put together an appropriations bill or bills for Senate approval. Inouye has said Congress will not be able to reach agreement in time and will need to pass another short-term CR. He is probably correct. There are only three weeks remaining until the current CR runs out. Next week Congress will be focused on the president’s FY2012 budget (to be released on Monday). Congress is out the following week for the President’s Day recess. That leaves only one week to strike a deal, hardly enough for the House and the Senate to debate and pass their respective bills and resolve what will likely be large differences