Department of Homeland Security FY 2018 IT Budget Observations

Late last month the White House released its full fiscal year (FY) 2018 budget request and DHS was one of a handful of departments that received significant increases in their overall discretionary budget. This entry will focus on the particulars of DHS’s information technology (IT) budget request for FY 2018.

DHS IT and New Development Budgets

The FY 2018 IT budget request for DHS is $6.8B allocated across the directorates, which would be a $65M increase (+1.0%) above the FY 2017 level of $6.8B and 0.9% ($63.5M) over the FY 2016 level.

Within this total $6.8B, the new budget provides new development spending, known as Development, Modernization and Enhancement (DME), of $1.2B or 17.2% of the total IT budget, a $98.7M (7.7%) decrease from the FY 2017 enacted level and $66M (5.3%) less than in FY 2016. Complementing this DME is $5.7B in Operations and Maintenance (O&M) funding, which is an increase of $164M (3.0%) over the FY 2017 enacted level and $129M (1%) above the FY 2016 level. O&M accounts for nearly 83% of the DHS IT budget, which is roughly 1.5% more than in recent years.

The year-to-year changes for the various directorates and agencies are pretty diverse, ranging from +74% to -19%, but most receive a budget increase and some that do have decreases for next year still remain above their FY 2016 levels. (See table below.)

Looking at the portion of each agency’s allocation for DME reveals a wide variety in change from FY 2017 to FY 2018. Further, growth or decline in an agency’s total IT budget does not always correspond to the same direction or magnitude in DME spending. Unlike what we have seen over the last few years, for FY 2018 DHS joins the general trend among federal agencies of receiving declining DME funds as a proportion of an agency’s overall IT budget.

Noteworthy IT Programs

Delving into the details of DHS’s IT investments and initiatives gives deeper insight into their priorities, which is largely infrastructure-focused. Here are just five initiatives that stand out among others due to relative size, budget growth, and/or proportion of new development spending.

• CBP Infrastructure – This IT infrastructure program is the backbone that supports all of CBP's IT systems and is the largest budget line item among DHS’s 355 IT investments for FY 2018. The FY 2018 total allocation of $538M, up $106M from the FY 2017 enacted level and $102M over FY 2016. As it often the case with infrastructure programs, this investment is designated as 100% O&M spending.
• NPPD National Cybersecurity & Protection System (NCPS) – The National Cyber Security Division, through its National Cybersecurity Protection System (NCPS), protects the Federal civilian departments and agencies IT infrastructure from cyber threats. At $398M (-$73M) for FY 2018, NCPS is DHS’s second single largest IT budget line in the new fiscal year. Further, 18% of this investment is slated for DME.
• TSA Information Technology Infrastructure Program (ITIP) – The ITIP program manages the delivery of a wide range of IT infrastructure services to support TSA's information processing, IT security, telecommunications and other related IT requirements. As the third largest IT budget line for FY 2018, ITIP receives $358M, which is about $9M (-3%) less than in FY 2017.
• NPPD Homeland Advanced Recognition Technology (HART) – HART as a replacement for the Automated Biometric Identification System (IDENT) under the Office of Biometric Identity Management (OBIM), formerly US-VISIT. Slated to receive $235M (-4%) in FY 2018, the investment consists of 17% DME funds.
• CBP Non-Intrusive Inspection (NII) Systems Program – NII supports the detection and prevention of contraband, including drugs, currency, and other illegal merchandise, flow of legitimate commerce. The initiative receives $231M (+11%) for FY 2018, of which $111M (48%) is DME.

Also noteworthy within DHS’s IT budget is an item for the CIO staff across DHS that is not associated with any specific IT Investment, which at $263M is the fourth largest IT budget line for FY 2018. That requested amount is $64M (+32%) above the enacted FY 2017 level but still $14M (5%) below what DHS spent in FY 2016. This fluctuation suggests continued evolution within DHS’s IT department. Further, the staffing line fluctuation is a pretty stark contrast to the over IT budget, which has been relatively flat over these same years. That said, DHS’s IT budget had been right around $6B in FY 2014 and 2015, so sustaining a roughly $6.8B budget level may signal a more stable longer-term baseline.