FY 2017 President’s Budget Request – GovWin FIA’s First Take

As the final budget submission of the Obama Administration, the FY 2017 President’s Budget Request provides a blueprint for the administration’s policy and legislative agenda for the fiscal year that will include a transition to a new administration.

Several of my fellow GovWin Federal Industry Analysis (FIA) colleagues and I dove right in so that we could provide you with our first impressions of what we found noteworthy. We reviewed the largest federal departments’ discretionary budgets to get a sense of direction and priorities for FY 2017, which begins October 1, 2016. Below is a summary table followed by key funding details and initiatives arranged by department.

 

Defense

The president’s budget request includes $582.7B in discretionary funding for the Department of Defense, 0.4% more than the enacted level of $580.2B in Fiscal Year 2016.

Funding highlights include:

• $59B for Overseas Contingency Operations (OCO), roughly equal to both the 2016 enacted level and the level set by the Bipartisan Budget Act of 2015
• $148B for the Army, an increase of $1.1B from the FY 2016 enacted level of $146.9B
• $164.8B for the Navy, a decrease of $3.9B from the FY 2016 enacted level of $168.7B
• $166.8B for the Air Force, an increase of $5.1B from the FY 2016 enacted level of $161.7B
• $102.9B for Defense-Wide operations, a decrease of $100M from the FY 2016 enacted level of $102.8B
• $250.8B for DoD operations and maintenance funding, an increase of $6.4B from the FY 2016 enacted level of $244.4B
• $112B for DoD procurement funding, a decrease of $6.8B from the FY 2016 enacted level of $118.8B
• $71.7B in DoD RDT&E funding, an increase of $2.7B from the FY 2016 enacted level of $69B
• $33.8B for the Defense Health Program, an increase of $900M from the FY 2016 enacted level of $32.9B
• $12.5B for DoD’s Science and Technology (S&T) Program, a decrease of $500M from the FY 2016 enacted level of $13B
• $7.4B for C4I systems, an increase of $300M from the FY 2016 enacted level of $7.1B
• $7.1B for DoD Space-Based Systems, an increase of $100M from the FY 2016 enacted level of $7.0B
• $6.7B for DoD cyber operations, an increase of $900M from the FY 2016 enacted level of $5.8B

Agriculture

The president’s budget request includes $24.2B in discretionary funding for the Department of Agriculture, 5.4% less than the enacted level of $25.7B in Fiscal Year 2016.

Funding highlights include:

More than $1B in financial assistance to rural businesses

• $700M for fundamental and applied agricultural sciences research
• $450M for renewable energy systems development for the Rural Energy for America Program
• $94.5M for the construction and renovation of Agricultural Research Service facilities
• $35M to address antimicrobial resistance in pathogens of humans and livestock
• $30M to strengthen USDA’s Avian Influenza preparedness and response capabilities
• $20M for the ongoing modernization of USDA Headquarters facilities
• $8.5M for genome sequencing innovations and analytics at the Food Safety and Inspection Service (FSIS) to reduce the prevalence of foodborne illnesses
• $10M to improve USDA’s monitoring for system vulnerabilities and to expand its cyber security capabilities
• $7.6M to build a Digital Services team

Commerce

The president’s budget request provides $9.7B in base discretionary funding to Commerce, a 3% increase over FY 2016 enacted levels. These funds are intended to promote growth through trade, invest, and innovation as well as a data-driven economy.

Funding highlights include:

• $5.9B for the National Oceanic and Atmospheric Administration (NOAA), an increase of $77.0M over the FY 2016 enacted level.
  • Investment in providing information and services will help make communities more resilient against extreme environmental events.
  • $8.5M is requested to continue the Service Life Extension Program (SLEP) to maintain Next Generation Weather Radar (NEXRAD) infrastructure to support the continued evolution of the National Weather Service (NWS).
  • Requests an additional $23.0M to continue development activities in support of the Polar Follow On (PFO) and Joint Polar Satellite System (JPSS) missions as well as an Earth Observing Nanosatellite-Microwave (EON-MW) to ensure continuity of polar observations through FY 2038.
  • NOAA seeks $6.3M to establish a new funding model to enable regular updates of its supercomputing capacity.
  • Proposes $6.2M to address information technology security issues throughout NOAA’s organization.
• $3.2B for the U.S. Patent and Trademark Office (USPTO). The authority to spend fee collections of $3.3B combined with $22.0M from other income is expected to fund $3.2B in operations, a transfer of $2.0M to the Office of the Inspector General (OIG), and 12,835 full-time equivalents (FTE), and result in adding $97.0M the operating reserve balance.
• $1.6B for the Bureau of the Census, including a $2.6M transfer to the Department of Commerce, Office of Inspector General.
  • $596.2M in base funding for development and implementation for the 2020 Census, an increase of $182.1M from FY 2016 levels.
  • $83.2M in base funding Enterprise Data Collection and Dissemination Systems, namely the Census Enterprise Data Collection and Processing (CEDCaP) IT system that supports automated 2020 data collection and processing operations.
• $1.0B for the National Institute of Standards and Technology (NIST), marks an increase of $50.5M over the FY 2016 enacted level.
  • Requests $730.5M for the Scientific and Technical Research and Service (STRS), a $40.5 million increase from FY 2016 to fund inflationary adjustments and seven program increases.
  • Includes support to continue expanding the National Network for Manufacturing Innovation. 

Energy

The president’s budget request provides $30.2B in base discretionary funding to Energy, a 2% increase over FY 2016 enacted levels. These funds are intended to support nuclear security, clean energy, environmental cleanup, climate change response, as well as science and innovation.

Funding highlights include:

• $12.9B for the National Nuclear Security Administration (NNSA). These funds include $1.8B for Defense Nuclear Proliferation, $9.2B nuclear infrastructure modernization, and $1.4B to advance capabilities for a 21^st century Navy.
• $12.6B for science and energy programs, including $2.9B for the Office of Energy Efficiency and Renewable Energy to build on efforts to reduce reliance on fossil fuels.
• Invests $6.1B in human health protection and environmental clean up to address legacy nuclear waste and contamination. Includes $2.4B to maintain progress on constructing and operating facilities to address waste stored in underground tanks
• Increases investments for clean energy research and development. $5.9B in discretionary funds for Mission Innovation to accelerate public and private clean energy innovation.
• Nearly $5.7B in funds for the Office of Science to continue research in an array of fields including high energy, nuclear, and plasma physics; materials and chemistry; biological systems and earth system components; and mathematics.
• $500.0M for the Advanced Research Projects Agency–Energy. This level includes $350.0M in new appropriations and $150.0M in new mandatory spending authority for transformative applied energy research and development.
• Requests $5.0M to establish an independent, statutory office for cost estimating and program evaluation.

 Health and Human Services

The president’s budget request provides $78.3B in base discretionary budget authority to HHS, a 7.9% decrease over FY 2016 enacted levels. 

Funding highlights include:

• Increases access to early intervention mental and behavioral health programs, expands the behavioral health workforce and supports suicide prevention to include $530M of funding to expand access to behavioral health services.   
• Provides $1B for an initiative to address opioid abuse, misuse, and overdose to expand access to treatment.
• Supports emergency preparedness and response, by bringing the U.S. and world partners together around natural and man-made threats, disasters, outbreaks and epidemics. Provides $915M in total for the CDC and the Assistant Secretary for Preparedness and Response (ASPR) for these activities.
• Maintains historic investments in Head Start and increasing the number of children attending programs of longer duration by allotting $9.6B, an increase of $434M over FY 2016.
• Makes major investments in child care of $82B in mandatory funding over 10 years to increase the number of children served, invest in the quality of the child care workforce, and implement new health and safety requirements.
• Implements investments to maintain a position at the forefront scientific, technological, and medical breakthroughs to include supporting the vice president’s Cancer Moonshot, continuing to scale up the Precision Medicine Initiative and funding research such as the Brain Research through Advancing Innovative Neurotechnologies (BRAIN) initiative.
• Supports the operation of Health Insurance Marketplaces to make quality coverage affordable, and encourages states to expand their Medicaid programs.
• Incentivizes quality, rather than quantity of services, and promotes information sharing to build a better, smarter, healthier health care system.
• Proposes targeted reform to Medicare, Medicaid and other health programs that are projected to save roughly $375B over the next decade.
• Includes $51M to increase the department’s protections against cyber threats that pose risks to HHS critical functions, services, and data.

Homeland Security

The president’s budget provides $47.7B in total discretionary budget for DHS, including $40.6B in net discretionary funding and an additional $6.7 billion for the Disaster Relief funding. The $40.6B would be a $381M (-0.9%) reduction over the FY 2016 enacted level.

Funding highlights include:

• $471.1M for the National Cybersecurity Protection System to maintain currently deployed EINSTEIN capabilities and invest in new capabilities for analytics, information sharing, and intrusion prevention.
• $274.8M for the Continuous Diagnostics and Mitigation (CDM) program hardware, software, and services
• $7.0B for the costs of 21,070 Border Patrol agents and 23,821 CBP officers and $197.5M to sustain border inspection and enforcement efforts abroad
• $5.1B for the Transportation Security Administration (TSA) for transportation screening operations to ensure the freedom and movement of people and commerce
• $292.0M for Customs and Border Protection (CBP) targeting programs, including support for the National Targeting Centers (NTC) for passengers and cargo
• $103.9M for Radiological and Nuclear Detection equipment enabling the Chemical, Biological, Radiological, Nuclear, and Explosives (CBRNE) Office and the DHS operating components
• $108.2M to enhance White House security, including support for the U.S. Secret Service’s (USSS) Operational Mission Support initiative
• $1.1B to replace aging Coast Guard cutters, aircraft, electronic systems and shore infrastructure
• $173.8M for the CPB Non-Intrusive Inspection (NII) Equipment program for passive radiation scanning and X-ray/gamma-ray imaging of cargo and conveyances
• $52.8M to fund investments focusing on expanding a replacement biometric identification system for DHS

 Justice

The president’s budget request provides $29.0B in base discretionary funding to Justice, a 1% increase over FY 2016 enacted levels. These funds are intended to support core law enforcement needs, safe and secure prisons, and other Federal, State, Tribal and local programs.

Funding highlights include:

• Requests $900.0M to strengthen cybersecurity. This includes an increase of $175.0M for FBI cyber investigations, of which $85.0M will upgrade technical tools, networks, and connectivity and $52.0M will support insider threat detection and intelligence activities. $38.0M will provide anti-encryption technology and research to support law enforcement challenges.
• Targets reductions in gun violence through several channels: Provides funding to hire 200 new special agents and investigators for the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). Supports enhancement of the National Integrated Ballistics Information Network (NIBIN). Continues modernization and improvements for the National Instant Background Check System (NICS).
• Funds efforts to combat violent extremism (CVE). $4.0M for research to advance evidence-based strategies for effective prevention and intervention of violent extremism. $6.0M in support locally-developed CVE models. $2.0M for training. $3.0M for law enforcement enhancing projects.
• Works to improve post-incarceration outcomes by expanding prison mental health and substance abuse programs. This includes $24.0M to implement proposals to reform the use of restrictive housing and expand treatment opportunities.
• Promote policing efforts to build and sustain community trust. Includes $97.0M to expand training and oversight of local law-enforcement, increase use of body-worn cameras, and facilitates additional reforms.
• $1.4B to fund the new FBI headquarters facility. $646.0M is sought through the Department’s budget and $759.0M through the General Service Administration’s Federal Building Fund.

State and USAID

The president’s budget provides $50.1B in total discretionary funding for the Department of State and the U.S. Agency for International Development (USAID), including $35.2B in base discretionary funds and $14.9B in Overseas Contingency Operations (OCO). Total discretionary funding for FY 2017 is $580M (-1.1%) below the FY 2016 enacted level and the $35.2B in discretionary funding is $71M (-1.7%) below the FY 2016 enacted level.

Funding highlights include:

• $6.1B for Embassy Security, Construction, and Maintenance and Worldwide Security Protection, including Diplomatic Security (DS) operations, IT network and infrastructure protection, and medical support at selected posts, and emergency planning and preparedness.
• $4.1B to stabilize communities liberated from ISIL in Syria and Iraq; disrupt ISIL’s attack-plotting, financing and recruitment; discredit ISIL propaganda; and support a political solution to the Syrian civil war
• $983.9M for both the State Department and USAID to advance the Global Climate Change Initiative, including $500.0M for the cross-agency Green Climate Fund
• $750.6M to sustain a long-term, comprehensive approach designed to address the underlying causes of migration of unaccompanied children and families from Central America
• $1.4M to Promote a Secure and Open Internet through the Office of the Coordinator for Cyber Issues

Transportation

The president’s budget request includes $12.0B in discretionary appropriations for the Department of Transportation, 16.1% less than the $14.3B enacted in Fiscal Year 2016.

Funding highlights include:

• $956M in discretionary funding for modernization of the Next Generation Air Transportation System
• $877M for NextGen capital investments
• $730M for the National Highway Traffic Safety Administration (NHTSA) to research and develop life-saving technologies and to support vehicle safety programs
• $640M for motor carrier safety and consumer enforcement by the Federal Motor Carrier Safety Administration (FMCSA)
• $200M for pilot deployments of safe and climate-smart autonomous vehicles
• $63M for Research, Engineering & Development to support NextGen and other areas of environmental and unmanned aircraft safety research
• $60M to fund National Highway Traffic Safety Administration (NHTSA) research in advanced vehicle technology
• $15M for improvements in the DOT’s cybersecurity posture
• $4M for the DOT to meet the requirements of the Digital Accountability and Transparency Act of 2014

Treasury

The president’s budget request provides $13.1B in base discretionary budget authority to Treasury, a 4.0% increase over FY 2016 enacted levels.   

Funding highlights include:

• Includes $2.3B for Treasury’s International Assistance programs to promote national security, open new markets for U.S. exporters, drive progress on sustainable development, and address key global challenges such as food security and the environment.
• Helps developing nations reduce carbon pollution, strengthen climate resilience, and pursue smart and sustainable long-term economic growth through a $250M contribution to the Green Climate Fund.
• Invests $11.8B in base discretionary resources for the IRS, an increase of $530M (4.7%) from FY 2016, to fairly enforce the tax code and improve taxpayer services, including by developing and enhancing online tools for taxpayers.
• Enhances existing security systems on department networks and public websites, and supports public-private cybersecurity coordination with a new $110M department-wide Cybersecurity Enhancement Account.
• Funds the Office of Terrorism and Financial Intelligence with $117M to curb terrorist financing, including ISIL financing, and to implement sanctions targeting Iran, North Korea, Syria, and more, as well as $115M for the Financial Crimes Enforcement Network.
• Promotes economic development in low-income and underserved communities through a $246M investment in the Community Development Financial Institutions Fund, a $12M increase (5.3%) from FY 2016.

Veterans Affairs

The president’s budget request provides $75.1B in base discretionary budget authority to VA, a 4.9% increase over FY 2016 enacted levels.

Funding highlights include:

• Provides $65B for VA medical care to provide high-quality, timely health care services to veterans and other eligible beneficiaries (includes 2017 advance appropriations).
• Supports improvements in veterans’ mental health care, telehealth care, treatments for Hepatitis C, specialized care for women veterans, long-term care, and benefits for veterans’ caregivers.
• Invests $1.6B in programs that will continue efforts to end veteran homelessness.
• Provides $7.2B in discretionary funding for veterans’ Care in the Community, which, combined with resources from the 2014 Veterans Choice Act, will support over 15.6 million medical procedures for veterans by non-VA providers.
• Strengthens veteran benefits programs by improving the timeliness of non-disability claims and further enhancing disability claims processing accuracy and efficiency.
• Continues the MyVA initiative, which is changing VA’s culture, processes, and capabilities to put the needs, expectations, and interests of veterans and their families first.

FY 2017 Federal Information Technology Budget Request

The president’s request includes a total of $81.6B in Information Technology spending across executive branch departments and agencies, up just $91M (+0.1%) from the FY 2016 enacted level.

• 30.3B for the Defense Department, which is $483M (-1.6%) below the FY 2016 enacted level
• $51.3B for Civilian departments and agencies which is $574M (+1.1%) above the FY 2016 enacted level

Stay tuned to GovWin Federal Industry Analysis as we will be publishing our complete analysis of the FY 2017 budget request, where we will go into greater detail on the key initiatives, IT investments and contractor implications that will shape the federal IT marketplace for FY 2017.

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Fellow GovWin Federal Industry Analysis (FIA) analysts Kyra Fussell, Deniece Peterson, Angela Petty and Alex Rossino contributed to this entry.