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Pentagon may seek coronavirus funds in next relief bill

Department of Defense may ask for billions to help defense companies struggling with cash flow

The Defense undersecretary for acquisition and sustainment said Thursday that the DOD may not have the flexibility to redirect portions of its $738 billion budget.
The Defense undersecretary for acquisition and sustainment said Thursday that the DOD may not have the flexibility to redirect portions of its $738 billion budget. (Bill Clark/CQ Roll Call file photo)

The Defense Department may seek billions of dollars in the next COVID-19 recovery bill because it may not have the flexibility to redirect portions of its $738 billion budget, the Pentagon’s top weapons buyer said Thursday.

Ellen Lord, Defense undersecretary for acquisition and sustainment, told reporters that her office is continuing to work with the White House’s Office of Management and Budget to assess how much it might request in the next COVID-19 funding bill.

Lord previously said that the Pentagon may ask for billions of dollars to help defense companies that are struggling with cash flow because of slowdowns and disruptions caused by the outbreak. The Pentagon has already indicated it would push $3 billion to companies in its supply chain by increasing the amount of expenses it reimburses for costs incurred as projects proceed.

“I am not sure we have the fiscal flexibility to encompass all of the new demands we have and all the inefficiencies that we are seeing and perhaps may see in the future,” she said.

On Wednesday, House Armed Services Committee Chairman Adam Smith of Washington suggested the Defense Department could find the money within its $738 billion budget for fiscal 2020. He does not support more funding for the Defense Department in the next recovery bill, he said.

Responding to Smith’s comments, Lord said she respected his point, but the Pentagon may not have the fiscal flexibility to proceed as he suggested.

“Congress is fairly strict about appropriating money with specific authorizations for its use,” she said.

The Defense Department might be able to repurpose some money from its operations and maintenance account, some of which is not being used because of reduced activity stemming from the outbreak, she said.

“However, we do have some pretty significant needs in terms of readiness and modernization in order to perform our primary mission, which is national security,” she said.

Earlier this year, the Pentagon reprogrammed $3.8 billion, primarily from procurement accounts, to pay for the border wall, one of President Donald Trump’s pet projects and a key election promise. This drew bipartisan criticism from lawmakers, even from Republicans who had gone along with moving $3.6 billion out of military construction accounts the previous year.

Congress limits the amount that the Defense Department can reprogram each year to ensure the Pentagon spends the money as lawmakers intended. The ability to shift some money reflects the understanding that with a massive budget prepared years in advance, there is sometimes the need for flexibility as circumstances and needs change.

The earlier reprogramming used up a significant amount of the Pentagon’s authority, limiting the department’s ability to shift money around in response to COVID-19.

Under law, the Pentagon may redirect up to $4 billion of its regular, or base, budget, with another $2 billion available from its war-fighting funds, known as Overseas Contingency Operations.

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