State Department and USAID FY 2023 Budget Request Highlights

The Office of Management and Budget (OMB) released its fiscal year (FY) 2023 budget request late last month and the Department of State (DoS) and the U.S. Agency for International Development (USAID) together rank among the highest-funded civilian departments. State is also among the civilian departments requesting a double-digit-percentage budget increase for next fiscal year.

Total Discretionary Funding and Priorities

The FY 2023 budget continues to place the State Department and USAID on an upswing at the topline discretionary level, requesting $60.4B in aggregate discretionary funding, a 13.8% increase from the FY 2021 enacted level. (Due to the late passage of final FY 2022 appropriations, investment levels in the FY 2023 budget are compared to 2021 funding, as agencies work to implement funding levels from the FY 2022 omnibus.)

Funding highlights include:

• Requests $9.6B for Diplomatic Programs, a $675M increase from FY 2021. The total includes $5.8B to support daily operations at U.S. embassies, consulates and diplomatic missions around the world and $3.8B for Worldwide Security Protection (WSP).
• Provides $10.6B for global health programs, a $1.4B increase above FY 2021. An additional $6.5B is included for State and USAID over five years to make transformative investments in pandemic and other biological threat preparedness globally.
• Includes over $11.0B in international climate financing, including a $1.6B contribution to the multilateral Green Climate Fund. The Budget also supports a $3.2B loan to the Clean Technology Fund to finance clean energy projects in developing countries.
• Allocates $350M to expand reliable and affordable internet access through the deployment of secure digital and technological infrastructure and improved international cybersecurity practices.

Information Technology Budgets

Details of State’s and USAID’s IT budget are published on OMB’s IT Dashboard, giving insight into their planned IT investments, initiatives and priorities. The State Department’s FY 2023 IT budget request is nearly $3.2B, which would be a $305M (+10.6%) increase from the FY 2021 enacted level and $33M (1%) above the FY 2022 level (if the FY 2022 figures are accurate). USAID’s FY 2023 IT budget request comes in at $327M, placing it $43M (+15.1%) more than FY 2021 and $53M (+19.1%) more than the stated FY 2022 level (again, if correct).  

Both DoS and USAID, like other federal agencies, allocate a portion of their total IT budgets for new development spending, known as Development, Modernization and Enhancement (DME). For FY 2023 State allocates $712M for DME, which is $286M above FY 2021 and $61M above FY 2022, increases of 67% and 9.4% respectively. Following suite, USAID proposes an 88.4% DME increase to reach $100M for FY 2023. Taken together, State and USAID represent $812M in combined DME. (See table below.)

Noteworthy IT Programs

The details of the State Department’s and USAID’s IT investment priorities and initiatives provide some perspective on where they are planning to invest in FY 2023. These are the six largest IT initiatives across the State Department for FY 2023, including observations about budget growth and their proportion of new development spending.

• Bureau IT Support: This set of investments encompass centrally provided shared IT support services such as desktop services; telecomm, wireless & data services; peripherals; software; and any other IT infrastructure costs incurred by the various DoS bureaus. It receives an aggregate $623M for FY 2023, which is 14% below FY 2021 and is made up of 19% DME. Historically, Bureau IT Support had been listed as a single large initiative, but beginning with the FY 2020 budget Bureau IT Support was broken out by 33 bureaus, offices, etc. offering the same IT infrastructure support to each. It is re-aggregated here to show the comparative size and influence of these effort on the State Department’s IT landscape.
• Consular Enterprise Infrastructure & Operations: This program maintains Consular Affairs (CA) IT infrastructure and provides technical services to support CA’s systems across 300 locations world-wide, supporting over 4000 servers and 4 petabytes of data. The program provides infrastructure improvements and upgrades to test environments. Funding of $394M for FY 2023 would be a $83M (+27%) increase from FY 2021, consisting of 24% DME funding.
• Enterprise Network and Bandwidth Services: ENBS designs, operates, maintains, secures, and modernizes the DoS IT network infrastructure and systems, enabling collaboration and information sharing across DoS and its foreign affairs partners. It receives $270M for FY 2023, an increase of $39M (+17%). This initiative is 100% Operations and Maintenance (O&M) funding.
• Deployment, Maintenance, and Refresh Services: Ensures domestic and overseas IT equipment is routinely updated, relocated, and/or replaced. Service includes procuring, deploying, and maintaining upgraded workstation/software packages, server, telecommunications, radio, and video collaboration. This initiative receives $254M for FY 2023, a $65M increase over FY 2021 and is categorized entirely as O&M.
• Enterprise Licensing: This initiative addresses lifecycle management of State’s Bureau of Information Resource Management (IRM) 400 existing IT agreements, many of which are unmanaged, or are otherwise inactive. The budget line receives $175M for FY 2023, which is a $44M increase from FY 2021, and is comprised of 100% DME funding.
• AIS Security Infrastructure Support Program: The AIS Security Infrastructure Support Program is the Department’s front-line defense against all form of cyber threats and ensures a safe digital environment for accomplishing the Department’s diplomacy mission.  It leverages the Directorate of Cyber and Technology Security’s program matrix to detect, react, and respond to malicious cyber activity and deliver actionable threat intelligence and vulnerability analysis to support the Department’s risk management process and IT innovation agenda. The program receives $153M for FY 2023, which is 41% above FY 2021, and is 100% O&M spending.

These largest budget line items reveal that infrastructure and operational requirements continue to dominate State Department priorities, which is in keeping with federal departments government-wide. Nonetheless, elements of new development and growth within these programs and others indicate ongoing efforts to modernize IT infrastructure for mission support. Both aspects of State’s IT landscape will continue to draw upon contracted support services and commercial products to achieve program objectives.