CBO Issues Cost Estimate for National Defense Authorization Act
H.R. 5515
National Defense Authorization Act for Fiscal Year 2019
As reported by the
SUMMARY
H.R. 5515 would authorize appropriations totaling an estimated
The bill also contains provisions that would affect the costs of defense programs funded through discretionary appropriations in 2020 and future years. Those provisions mainly would affect force structure, compensation and benefits, and various procurement programs. CBO has analyzed the costs of a select number of those provisions and estimates that they would, on a net basis, increase the cost of those programs relative to current law by about
Several provisions of H.R. 5515 would have insignificant effects on direct spending and revenues over the 2019-2028 period. Because enacting the bill would affect direct spending and revenues, pay-as-you-go procedures apply.
CBO estimates that enacting H.R. 5515 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2029.
H.R. 5515 contains intergovernmental and private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA). CBO estimates that the aggregate cost of the mandates would fall below the annual thresholds established in UMRA for intergovernmental and private-sector mandates (
ESTIMATED COST TO THE FEDERAL GOVERNMENT
The estimated budgetary effects of H.R. 5515 are shown in Table 1. Almost all of the
Some authorizations, however, fall within other budget functions, including
BASIS OF ESTIMATE
For this estimate, CBO assumes that H.R. 5515 will be enacted near the start of fiscal year 2019 and that the authorized and estimated amounts will be appropriated each fiscal year.
Spending Subject to Appropriation
For 2019, H.R. 5515 would authorize an estimated
The total amount that would be specifically authorized for defense programs is an increase of
H.R. 5515 also contains provisions that would affect the cost of various discretionary programs in future years. Most of those provisions would affect end strength (the number of military personnel at the end of a fiscal year), military compensation and benefits, and authorities related to the acquisition of weapons systems. The estimated effects of some of those provisions are shown in Table 3 and discussed below. The following sections discuss how those provisions would affect the need for discretionary appropriations in future years. Force Structure. The bill would affect the force structure of the various military services by setting end-strength levels for 2019 and modifying the minimum end-strength levels authorized in permanent law.
Under title IV, the authorized end strengths in 2019 for active-duty personnel and personnel in the selected reserves would total 1,338,100 and 817,700, respectively. Of the selected reservists, 83,062 would serve on active duty in support of the reserves. In total, active-duty end strength would increase by 15,600 and selected-reserve end strength would increase by 800 when compared with levels authorized under current law for 2019. The specified end-strength levels for each component of the armed forces are detailed below with CBO's estimate of the effects of those changes on
Active-Duty End Strengths. Compared with end strengths authorized under current law for 2019, section 401 would authorize increases in active-duty personnel for all four services: 7,500 more for the
Selected-Reserve End Strengths. Sections 411 and 412 would authorize the end strengths for reserve components, including those who serve on active duty in support of the reserves. Under this bill, three of the six reserve components would experience increases in end strength: 500 more for the
Reserve Technicians End Strengths. Section 413 sets the end-strength for dual-status military technicians, who are federal civilian personnel required to maintain membership in a selected-reserve component as a condition of their employment. Section 413 would reduce the number of dual status technicians by 166. CBO estimates a decrease in costs for civilian salaries and expenses from 166 fewer dual status positions of
Compensation and Benefits. H.R. 5515 contains several provisions that would affect compensation and benefits for uniformed personnel and civilian employees of
Expiring Bonuses and Allowances. Section 611 would extend for another year
The authority to enter into such agreements is currently scheduled to expire on
Temporary Duty Per Diem Allowance. Section 605 would prohibit
TRICARE Advantage Demonstration. Section 701 would require
The costs to
This demonstration program also would affect direct spending from the
Section 701 could also change the amount of the discretionary accrual payments made to the
Other Provisions. Several other provisions also would affect spending subject to appropriation, primarily by making changes to
Multiyear Procurement Contracts. The bill would authorize
* Section 124 would authorize the
information provided by the
* Section 145 would authorize the
* Section 127 would authorize the
* Section 126 would authorize the
* Section 125 would authorize the
* Section 1667 would authorize the
period, or about
Virginia-class Submarines. The
Section 130 would require the
Payments to Military Privatized Housing Initiative Lessors. Beginning one month after the date of enactment, section 604 would require
Payments from
Overhaul and Repair of Naval Vessels in Foreign Shipyards. Section 322 would require all vessels that are part of the
The
In addition, enacting this provision would reduce the operational status of the MSC ships. The
Indo-Pacific Maritime Security Initiative. Under the Southeast Asia Maritime Security Initiative, which is scheduled to expire
United States Space Command. Section 1601 would establish the United States Space Command as a unified subordinate command under the
Eliminating Certain DoD Organizations. Section 913 would require
following subordinate organizations by
*
*
* Defense Human Resources Activity,
*
*
* Test Resource Management Center, and
* Washington Headquarters Service.
Essential functions and assets of those organizations would be transferred to other components of the department. CBO expects that military personnel assigned to those agencies would be transferred to other positions in
The affected organizations employ about 7,000 civilian personnel and roughly an equivalent number of contract workers. Spending subject to appropriation could decline if eliminating those organizations reduces the number of civilian employees and contractors at
Direct Spending and Revenues
Several provisions in H.R. 5515 would have insignificant effects on direct spending or revenues, generally because very few people would be affected or because the proposal would allow the spending of new receipts so that the net effect would be small.
* Section 146 would eliminate a 30-day waiting period on the obligation of funds for the ECH-130 Compass Call program which would slightly accelerate outlays of amounts appropriated for 2018.
* Sections 523, 1076, 1213, 1221, and 1222 would extend or add to
* Sections 532 and 534 would establish domestic violence as a specified offense under the military justice system and modify the Military Rules of Evidence, respectively. Additional penalties collected as a result of those provisions would be classified as revenues.
* Section 551 would permanently authorize an expiring pilot program that allows service members to take a one-time career intermission (or sabbatical) from active service. During a sabbatical, a service member serves in the inactive reserve, and does not count against the authorized end strength for active-duty personnel. Unlike most members of the inactive reserve, a member on a sabbatical retains eligibility for disability retirement. Consequently, section 531 could result in a small number of additional service members receiving disability retirement if they suffer a qualifying disability during a sabbatical.
* Section 621 would allow certain spouses to retain eligibility to shop at commissary stores, thus increasing the patron base for those stores and likely the number of credit and debit card transactions processed. Those processing costs are borne by the
* Section 701 would require
* Section 1043 would delay by nine months (from
* Section 1079 would give states more time to spend federal grants for the construction and operation of public target ranges. That extension would change the timing of outlays from currently available appropriations.
* Section 1106 would reauthorize, through
* Section 1236 would increase the number of people who would be subject to civil or criminal penalties for violating sanctions. Penalties are recorded as revenues, and a portion of those penalties can be spent without further appropriation.
* Section 1252 would require the President to develop a whole-of-government strategy to address activities of
* Section 2823 would authorize the
* Section 3132 would require the
* Section 3523 would allow the Commandant of the
PAY-AS-YOU-GO CONSIDERATIONS
The Statutory Pay-As-You-Go Act of 2010 establishes budget-reporting and enforcement procedures for legislation affecting direct spending or revenues. CBO estimates that the net effects of H.R. 5515 on direct spending and revenues would be insignificant.
INCREASE IN LONG-TERM DIRECT SPENDING AND DEFICITS
CBO estimates that enacting H.R. 5515 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2029.
MANDATES
H.R. 5515 contains intergovernmental and private-sector mandates as defined in UMRA. CBO estimates that the aggregate cost of the mandates on public and private entities would fall below the annual thresholds established in UMRA for intergovernmental and private-sector mandates (
Mandate that Applies to Public and Private Entities
Section 401 would increase the costs of complying with existing intergovernmental and private-sector mandates by increasing the number of service members on active-duty by about 16,000 relative to currently authorized levels. Those additional service members would be eligible for existing protections under the Service Members Civil Relief Act (SCRA). Protections under SCRA require public and private entities to grant active-duty personnel various allowances for business and tax transactions and court procedures.
For example, SCRA allows service members to maintain a single state of residence for paying state and local personal income taxes and to request deferrals for certain state and local fees. CBO estimates that the additional cost of those mandates on state and local governments would be small.
SCRA also requires creditors to charge no more than 6 percent interest rate on service members' loan obligations when the acquisition of such obligations predates active-duty service, and it allows courts to temporarily stay certain civil proceedings, such as evictions, foreclosures, and repossessions. The Act also precludes the use of a service member's personal assets to satisfy the member's trade or business liability while he or she is in military service.
Under the bill, the number of active-duty service members covered by SCRA would increase by about 1 percent, CBO estimates. Service members' utilization of the various provisions of the SCRA depends on a number of uncertain factors, including how often and how long they are deployed. However, the increase in the number of active-duty service members covered by SCRA would be small, so CBO estimates that the incremental cost of compliance for public or private entities also would be small relative to the annual thresholds in UMRA.
Mandates that Apply to Private Entities Only
Section 1083 would impose a mandate on private entities by requiring the
probably be small. Therefore, CBO estimates that the aggregate cost of the mandates would fall well below the annual threshold established in UMRA for private-sector mandates (
Mandates that Apply to Public Entities Only
Section 1073 would impose an intergovernmental mandate as defined in UMRA. Under the federal Gun Control Act, a person may only purchase a firearm in the state in which he or she is considered a resident. Exceptions are made for members of the military, who are considered residents of states in which they are deployed on active duty. The bill would extend this exception to military spouses, allowing them to purchase firearms in the state where the military member resides or is permanently stationed for duty, or in a neighboring state if the military member commutes across state borders to his or her duty installation. To the extent that any state firearms law or regulation conflicts with this change, it would be preempted. Although it would limit the application of state laws, CBO estimates that it would impose no duty on states that would result in additional spending or a loss of revenues.
ESTIMATE PREPARED BY:
Federal Costs:
Defense Authorizations--
Military and Civilian Personnel--
Military Construction--
Military Health Care--
Military Retirement and Immigration--
Operation and Maintenance--
Procurement--
Small Business Administration--
Mandates:
ESTIMATE REVIEWED BY
Chief, Defense, International Affairs, and Veterans' Affairs Cost Estimate Unit
Chief, Public and Private Mandates Unit
Deputy Assistant Director for Budget Analysis
Click here to view the table (https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/hr5515.pdf)
1 TRICARE-for-Life is a benefit available to all military retirees and their dependents who are eligible for Medicare. Under TRICARE-for-Life, Medicare is the first payer for most health costs incurred by the beneficiary, and TRICARE acts as wrap-around coverage, paying almost all of the remaining costs. The only condition for receiving this benefit is that eligible beneficiaries must enroll in Medicare Part B.
2. TRICARE Senior Prime was a demonstration program created by the Balanced Budget Act of 1997 (Public Law 105-33) that allowed Medicare-eligible military retirees and their dependents to choose to forgo their regular Medicare benefit and participate in a health plan administered by
3. For instance, see
ion-of-the-TRICARE-Program.
4. For instance, see
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