As Navy leaders continue to scratch their heads over how to pay for the massive price tag of the SSBN(X) Ohio-class submarine replacement program in the coming years, Congress has done them the favor of creating a separate fund outside of the shipbuilding budget with the passage of the fiscal 2015 authorization and appropriations bills — the only problem is, there’s no money in that account and there won’t be for a while.
The Sea-Based Strategic Deterrent Fund aims to tackle the seemingly impossible task of paying for a submarine that will cost many billions of dollars in the 2020s with a shipbuilding budget that is typically just $14 billion and, like every other year, will already be tied up in buying new destroyers, attack subs, frigates, and other necessary vessels when it comes time to pony up $8 billion for the first ballistic missile sub in the class in 2021.
However, Congress didn’t add any actual funding to the fund with those bills, and likely won’t in the fiscal 2016 budget either.
Fortunately, lawmakers don’t have to — at least not yet. Since construction doesn’t start until 2021, money only needs to be set aside for research and development of the sub.
But the fund at this point is little more than a shell game rather than an actual solution to the Navy’s budget woes, exacerbated by the Budget Control Act, which will slice $10 billion off an already squeezed topline this year, said Bryan Clark, a senior fellow at the Center for Strategic and Budgetary Assessments. So even though the sub would be funded outside the shipbuilding budget, it’s not like the Navy will have money to put into it anyway.
The good news is the Navy won’t always be saddled with the BCA. In fact, it’s set to expire in 2021, just in time for funding of the SSBN(X). But because the sub has such an enormous price tag, the Navy faces a “little bit of a crisis” in figuring out how to fund that platform, Clark said.
Even without the BCA, the Navy is going to far exceed its $13.9 billion average budget in 2021 to purchase first-in-class vessel of the 12-sub buy. But there are ways out of it, Clark noted.
“Congress can continue to work on ways to adjust the budget caps like they did [with the Bipartisan Budget Act of 2013], so you can envision between now and 2021 doing something similar to that to mitigate it, at least for the first ship,” he said.
But even if the Navy can somehow survive 2021, there’s still a problem: it still has to build 11 more subs that will be cheaper than the first in class, but still multiple billions of dollars, well beyond shipbuilding funding levels of today. That’s a reality even a special fund can’t fix.
That means when 2023 and 2024 roll around and the service must buy subs at an accelerated pace, the Navy will have to make a choice: get more money elsewhere, or cut back on shipbuilding plans. Both options will be painful.