Department of Homeland Security FY 2019 IT Budget Observations

A few weeks ago the White House released its full fiscal year (FY) 2019 budget request and DHS continues to be allotted one of the largest information technology (IT) budgets among all federal departments, especially among the civilian departments where DHS ranks first for FY 2019.

DHS IT and New Development Budgets

The FY 2019 IT budget request for DHS is $6.843B allocated across its directorates, which would be only $964K (+0.01%) above the FY 2018 level of $6.843B. However, given the impacts of multiple FY 2018 continuing resolutions (CRs) on agency budget preparations it may be more reasonable to compare the FY 2019 numbers to FY 2017 levels. In that case, DHS’s FY 2019 IT budget comes in at $305M (+4.7%) above the FY 2017 level.

Within this total $6.8B allotment the new budget provides new development spending, known as Development, Modernization and Enhancement (DME), of just over $1.0B, or 15% of the total IT budget, a $194M (-16%) decrease from the FY 2018 enacted level and $125M (-11%) less than in FY 2017. Complementing this DME is $5.8B in Operations and Maintenance (O&M) funding, which is an increase of $195M (3.5%) over the FY 2018 enacted level and $430M (8%) above the FY 2017 level. O&M accounts for nearly 85% of the DHS IT budget, which is roughly 3% more than in recent years, a trend we’re seeing in many departments. For FY 2019 DHS effectively shifts $195M from DME to O&M spending.

The year-to-year changes for the various directorates and agencies are pretty diverse, but due to the uncertainty of the FY 2018 budget data that OMB provided I chose to base the growth comparisons on FY 2017. (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 2019. The key observation to note among these directorate budgets is that those with growth in Total IT from FY 2018 to FY 2019 also generally see growth in their DME budgets. This is especially true for TSA, ICE and FEMA, but is also visible at FLETC and for the Departmental Management and Operations (DMO) area.

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 391 IT investments for FY 2019. The FY 2019 total allocation of $495M, up $1.6M from the FY 2018 enacted level and $67M over FY 2017. 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 $407M for FY 2019 NCPS is DHS’s second single largest IT budget line in the new fiscal year. Further, 27% of this investment is slated for DME. The proposed funding level would be $9.5M above the FY 2018 estimated level but $61M less than in FY 2017.
• 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 2019, ITIP receives $370M, which is about $12M (3%) more than the FY 2018 estimated enacted level but would be about $8M (-2%) less than in FY 2017. The FY 2019 funding is 100% O&M.
• NPPD - Continuous Diagnostics and Mitigation (CDM) – The CDM program provides continuous monitoring, diagnosis, and mitigation activities to strengthen the security posture of the federal .gov networks. CDM is slated for $238M in FY 2019. This would put it almost $42M less than for FY 2018 but $12.7M more than the FY 2017 level. Fifty-three percent of this program’s FY 2019 budget goes for DME.
• DHS - Manage Information Technology – This investment accounts for the CIO staff across the DHS that is not associated with any specific IT Investment. This fifth largest IT budget line receives $218M for FY 2019, which would be almost $4M (-2%) below the FY 2018 level but $23M (+12%) above FY 2017.

Of course, Congress will have the final say when the responsible appropriations committee takes up the FY 2019 DHS budget later this year. Final FY 2018 discretionary and IT budgets still remain in CR limbo as Congress continues to work on what will likely be an omnibus appropriations covering the remaining half of the fiscal year.

Nevertheless, it is worth noting that for FY 2019 most of the DHS directorates are slated for significant growth over their FY 2017 budget levels. So while FY 2018 may be a murky year at this point we can be relatively hopeful that most of these agencies will sustain some growth in the coming fiscal year.