Skip to content

Hill-favored projects called defense budget’s ‘black hole’

Lawmakers appear to help steer defense research dollars with little oversight or transparency.

House Appropriations Chairwoman Granger, R-Texas, has banned earmarks from this year's defense funding bill, but questions linger around lawmaker-directed increases to research projects.
House Appropriations Chairwoman Granger, R-Texas, has banned earmarks from this year's defense funding bill, but questions linger around lawmaker-directed increases to research projects. (Bill Clark/CQ Roll Call file photo)

Congress directed the Pentagon to spend $12.2 billion in the current fiscal year on nearly 1,000 different “program increases” in the Defense spending bill’s research account alone, projects pushed by lawmakers that the Defense Department did not publicly request, according to a previously unpublicized database.

As spending on the overall defense budget grew in the last several years, the number of these lawmaker-inserted projects has ballooned from 600 in fiscal 2021 to 996 today, a 66 percent hike, according to the database, compiled by Taxpayers for Common Sense, a nonpartisan group that monitors government spending. 

The initiatives, which average $12 million apiece, are each tiny when considered separately, at least in the massive Pentagon budget, which is more than $800 billion. For that reason, the individual projects, like the larger phenomenon of surging congressional additions to the defense research budget, have received virtually no attention in the press. 

“It’s grown to more than $12 billion crammed into the services research accounts out of public view and without oversight,” Steve Ellis, president of Taxpayers for Common Sense, said in an interview.

To be sure, Congress has a duty to write defense spending bills as it sees fit. What’s more, on many occasions these congressional “plus-ups” or “adds” — which are often supported by Defense Department officials at military research labs or executives at start-up companies, even if not by senior Pentagon leadership — have led to what are widely considered useful outcomes. These include Predator drones that transformed military operations, and the Maui Space Surveillance Complex, where Air Force personnel track space objects and conduct laser research.

But the recent uptick in congressionally initiated spending on hundreds of defense research projects has gone on with little transparency or independent oversight. It is not clear how much the U.S. military has gotten out of it all. And there are unresolved questions about how often the contracts that follow from these appropriations are competitively awarded, as advertised.

That is the upshot from interviews with a dozen current and former congressional aides, lobbyists, Defense Department officials, auditors and nongovernmental experts on military budgets, most of whom requested anonymity because they are, with a few exceptions, still participants in the defense budget process and are concerned about professional consequences.

A former senior Pentagon financial official said the department has a lot of measures for gauging the effectiveness of weapons but “less often do we ask: ‘Did we get our money’s worth?’”

Questions unanswered and unasked

As Congress gears up to begin writing defense authorization and appropriations bills for fiscal 2024 in the coming weeks, any newly proposed defense research program increases may draw more scrutiny than usual, especially if the budget deal that emerges from debt limit talks puts downward pressure on Pentagon spending. 

The defense research projects are not the only additions to the Pentagon budget that are not requested. Congress adds billions each year for everything from weapons to medical research, much of which is not publicly endorsed or is even, in some cases, opposed by Defense Department leaders. 

But the research additions stand out because of their growing number and several key unaddressed questions about how they come to be and who benefits.

The defense research projects, listed in unclassified tables in the appropriations reports, have names that are sometimes inscrutable even to most defense experts, and many sound as if they might be patented processes of a particular company, such as “chromate-free corrosion inhibitor coatings for marine applications” and “ENDOR spectrum superiority technology.”

The spending insertions are not generally considered earmarks — a term that refers to congressional additions to funding bills that are aimed at particular recipients and that were wracked with abuses in the early 2000s, leading to several criminal convictions.

The defense research program increases are not categorized as earmarks because the contract awards they lead to are — technically at least — put out for competition.

But numerous defense contracting experts say the funding lines are often written in such a way that only one company can do the work. As a result, critics charge, these are de facto earmarks in many cases, and their numbers and costs are growing.

A few legislators have even issued press releases touting their work in “delivering” defense research appropriations for named companies in their states — even before any ostensible competition has taken place. 

Ellis of Taxpayers for Common Sense described the spending lines as “earmark-esque.”

Moreover, these projects and the process of funding them is almost completely opaque.

The unanswered questions go beyond how often more than one bidder vies for these contracts. 

Other lingering questions include: Which lawmaker pushed for a given funding line and how many of those advocates are influential appropriators? Which contractor or military organization would benefit? What is the purpose of any particular technology, as the funding tables offer only a few cryptic words of description per project? How often do useful military breakthroughs emerge from the process, as programs tend to appear only for a year or two in the spending bills before they are replaced by others? 

“It’s become a black hole of the defense budget,” Ellis said.

Neither Congress nor the Office of the Secretary of Defense nor the Pentagon inspector general’s office nor the Government Accountability Office, in replies to queries, could point to any assessments aimed at answering or even addressing these specific questions. The Pentagon does an annual report on competition for its contracts, but the review does not focus on any one appropriations area. 

The Defense Department did not answer a series of specific questions about the research funding additions and the department’s monitoring of their effectiveness. 

Instead, an official said via email that while the department is focused on certain technology areas, “we understand that priorities change based on a number of factors. We will continue to work with Congress and other stakeholders on these priorities as we set technology development on the right path to provide key capabilities to the warfighter.” 

‘Unofficially supported’

Appropriations that are allocated for these projects go to the military services’ and defense agencies’ labs or other facilities to either perform the work themselves or contract it out to companies or nonprofit institutions. 

Congress added $12.2 billion to the research budget but cut more than $2 billion from other programs to at least help pay for lawmakers’ additions elsewhere in the bill.

Consequently, the net increase in the research section of the fiscal 2023 Defense funding bill was $9.9 billion above President Joe Biden’s request, part of a $43 billion boost in total to the Defense spending bill above the request.

The defense research funding inserts are aimed at exploring important defense technologies that are generally not large-scale enough to be on the radar of senior military leaders and so do not make the annual “unfunded priorities lists” of top projects that senior Defense leaders say should be funded even though they are not in the budget request, advocates of the additions say. Only a handful of the 996 lawmaker-added projects in fiscal 2023 were on those unfunded priorities lists.

One current Defense Department official and one former one said the armed services’ senior leaders typically only learn about the projects when the spending bill and report are made public.

But the program increases are typically supported, though not publicly, by someone in the far-flung Defense Department bureaucracy, experts said. 

“Yes, many of these projects have Member constituent connections, so they support the requests for multiple reasons including valid user requirements and district employment,” a defense industry lobbyist said by email. “While they may not be officially requested, they are unofficially supported.”

The Pentagon is not a monolith, Mark Cancian, a former Office of Management and Budget official and now an analyst with the Center for Strategic and International Studies, said by email.

“Each of the subordinate baronies looks out after its own interests and maintains its own lines of communication,” said Cancian. “So it’s not surprising that laboratories or programs connect with congressional staff or their local members of Congress to suggest increases.”

The proponents also say the unrequested research projects are often aimed at developing technologies whose significance is not anticipated when each year’s budget is written more than a year before it is voted on. And they contend that the Appropriations Committees rigorously review the projects. 

A Senate Republican appropriations aide called the funding additions a pathway for small businesses and researchers to bring innovation and entrepreneurship to the Defense Department. 

“Input from a wide variety of innovative small businesses, defense experts, stakeholders, military leaders, research facilities, and universities throughout the country are taken into consideration during the appropriations process as part of the long-standing practice,” the aide said by email.

Press releases

Most appropriators publicly celebrate when they net Defense appropriations increases for large weapons like aircraft or ships. Less often do they tout securing relatively small defense research projects for their districts or states.

But some have done so on their websites, and a few have even mentioned companies that are going to win contracts long before the supposed competitions have even begun. 

For example, Sen. Jon Tester, D-Mont., the chairman of the Defense Appropriations Subcommittee, issued a press release in December when the omnibus spending package was unveiled. Tester touted how the bill “delivers” for Montana, because the senator was “making targeted investments” in Montana and the Department of Defense. 

Under “funding for Montana businesses,” Tester listed a half-dozen military research projects not requested by the Pentagon — and the names of the Montana companies that would secure the deals in competitions that have yet to take place.

An aide who is familiar with the appropriations process said the companies are just potential recipients. 

For example, Tester took credit in the statement for garnering $12 million in the Navy research budget for “universal achemetal titanium process.” It turns out there is a proprietary process by that name — a way to extract titanium from raw ore — that belongs to a Butte, Mont., company whose name is, in fact, “Universal Achemetal Titanium LLC.” 

The press release and the appropriations law itself contain a sentence noting that competition is required for each program except when it has happened in an earlier year.

The aide said the titanium project had been competed the year before, and UAT won, hence the fiscal 2023 funding was a follow-on that did not have to be competed.

Marc Snyderman, UAT’s general counsel and director of strategy, said via email it is “unknown at this time” if the company will face competition for the $12 million in fiscal 2023 funds.

The aide did not say whether the other awards listed as going to Montana companies in the press release were going to actually be competitive. The other five companies did not respond to requests for comment.

Similarly, Sen. Christopher S. Murphy, D-Conn., another appropriator, said in a December statement about the fiscal 2023 spending bill that he “supported federal funding that will benefit Connecticut’s defense and manufacturing industries.” 

Included on Murphy’s published list of programs that “will” benefit Connecticut were not just billions of dollars for submarines and fighter jets but also 13 defense-related research projects worth roughly $145 million altogether, though Murphy did not name companies. 

“Part of my job on the Appropriations Committee is making sure the budget we write funds Connecticut priorities,” Murphy said in the December press release.

In a statement this month to CQ Roll Call about the issue, Murphy said: “I have never shied away from promoting Connecticut’s manufacturers. I’m proud that last year’s defense bill will give many highly skilled manufacturers the opportunity to further develop new technologies, demonstrate them to the government, and compete for competitive contracts.”

Competition vs. effective competition

It is not clear how often the defense research funding additions are subject to effective competition — the official Pentagon term for situations where more than one bid is considered.

Washington insiders report that it seems, anecdotally at least, a substantial portion of the defense increases are handed to one favored company or institution — the one that Congress intended to get it. 

In some cases, experts say, the purported competitions are waived for legally allowable reasons, such as if only one company is technically able to do the work. 

More likely, a competition is in fact held, but the outcome is all but preordained, they say, because the names of projects are carefully written in the appropriations report’s funding tables so that only one company is likely to be qualified to do the work and so only one company answers the contract solicitation. 

Jack Deschauer, a partner at the Squire Patton Boggs law firm, has over 30 years experience in Washington, including as a Defense Department legislative liaison and a lobbyist. He said in an interview that the legal requirement for competition is satisfied if the service or agency holds a competition and abides by all the rules — even if ultimately only one company bids. 

But Deschauer suspects, based on his experience, that appropriators write their additions to the research budget so as to reduce the number of potential competitors.

“The specificity involved in many of these line item ‘program increases’ leads me to conclude that they are for a particular company,” Deschauer said.

What’s more, Defense Department officials, congressional staff and lobbyists typically communicate with one another to understand the congressional intent behind a funding line, Deschauer and others said.

Winslow Wheeler, a former Senate and GAO staff member for three decades, had a similar assessment.

“Either the committee staff or member staff will contact the appropriate office in DoD and say, ‘That $2.7 million for nanometer electronics — that’s my baby, and here’s who we expect to receive the money and, if you don’t do this, you’re going to get holy hell,’” Wheeler said in an interview. 

Moreover, if it appears to competitors that one company will win it, they sometimes do not bother competing, according to veteran observers of the process.

“These contractors aren’t dumb,” said Ellis of Taxpayers for Common Sense. “If there’s a funding line clearly tailored to one company, then a rival company isn’t going to spend the resources to compete.”

To be sure, on occasion a company that was not “supposed” to compete for the work vies for it, former congressional aides said, but more often than not, they said, the companies that lawmakers want to win the awards get them.

‘Earmark-esque?’

After earmarks — directed spending for projects of interest to lawmakers — earned a bad name in the early 2000s, Congress banned them from 2011 until 2021. 

When Congress permitted earmarks to resume, it was under rules that barred directing them to private corporations. The rules narrowly defined earmarks as funding that is uncompetitively awarded to government agencies or nonprofit institutions — such as the Army Corps of Engineers and university labs — when the funds have not been requested and are inserted at the request of a member of Congress. 

These earmarks for entities that are not companies are called community project funding in the House and congressionally directed spending in the Senate. 

The Defense research section of the fiscal 2023 spending law includes 16 of these projects, worth just $54 million, all added by the House — a minuscule portion of the defense budget.

This year, House Appropriations Chairwoman Kay Granger, R-Texas, has barred this small set of earmarks from the Defense bill and limited them in other bills. 

Spending on the rebranded earmarks has been transparent, with requirements for tables to be published in the appropriations reports listing which lawmaker sought the project, the amount of money, the purpose and the recipient. 

By sharp contrast, no such reporting is required for the “program increases.” The only public record of each of these is the dollar amount and a few words in the appropriations report funding tables.

Likewise, Congress asked the GAO to track and report on the community projects spending in great detail, and the GAO issued a report on fiscal 2022 earmarks spending. 

The auditors have done no such monitoring of the much larger sums of defense dollars dedicated to defense research “program increases.”

The program increases are not necessarily de facto earmarks, but the extent to which they are vied for by more than one company remains an open question — one that has not, it seems, even been addressed. 

Recent Stories

Capitol Ink | Special collector series

Congress’ tech plate is full, with little time at the table

Avoid hot takes on Trump’s supposed trial of the century

Food fight continues with ‘Food, Inc. 2’

Piecemeal supplemental spending plan emerges in House

White House issues worker protections for pregnancy termination