By Carlo Munoz
Navy budget officials may be forced to reassess its fiscal year 2012 budget request if Congress continues to extend funding for the service at FY ’10 levels, Chief of Naval Operations Adm. Gary Roughead said yesterday.
“We had planned on a lot of stuff happening [in FY ’12]. It has not happened, [and] how then do you rack and stack” those overdue priorities, the service chief said after a Credit Suisse conference in Arlington, Va.
“I think we would clearly have to go in and open up the FY ’12 budget.”
Since the beginning of FY ’11 last October, Congress has been financing Defense Department and the services under a continuing resolution (CR) to allow lawmakers time to pass the FY ’11 version of the defense spending bill. Under the CR, military operations have been funded at FY ’10 levels.
The Senate yesterday passed, and President Barack Obama later signed, another temporary budget funding the government for two more weeks, extending the current CR for two more weeks and avoiding a government shutdown. The House passed the two-week measure on Tuesday. The current CR expires on March 4 (Defense Daily, March 1).
But even with the proposal that passed Congress, Navy leaders are already preparing for the worst-case scenario–a year-long CR that would prompt a worse-case response by the service, Roughead said.
Steps have already been taken to mitigate the effects of the CR, mainly in the service’s operations and maintenance accounts. A number of Navy directorates have begun compiling a list of “key contract items” to determine which industry partnerships can be terminated, if a year-long CR is enacted.
Navy officials already submitted their lists to service procurement chief Sean Stackley before sending them to Pentagon acquisition czar Ashton Carter for review, Rear Adm. Joseph Mulloy, deputy assistant secretary of the Navy for budget, told Defense Daily in a Feb. 8 interview.
“There are a couple of contracts that are close to the edge,” he added. “There has to be a path ahead.”
The Navy has notified specific contractors of the projected four ship cancellations of four availability projects at shipyards in Norfolk, Va., Mayport, Fla., and San Diego.
Ship availability cancellations at the Norfolk shipyards will net the Navy a savings of $28 million alone, according to service sources. The project terminations at Mayport and San Diego will tack on an additional $34.4 million, they added.
While those cancellations have given the Navy some breathing room in terms of current operations, if it continues to function under FY ’10 spending levels, an entire slate of service priorities set in the FY ’11 and now FY ’12 budget proposals will have to be moved to the right, Roughead said.
‘The reality is that we could get to the end of this year with a set of assumptions that did not happen. How do you then reassume and restack because something I wanted to do this year…if I didn’t do it [and] because I was [planning on] doing it this year, one could assume it would have a higher priority [over] what I was going to do next year,” the admiral said. “It is hugely disruptive.”
When asked what kind of process would be needed to re-open the service’s budget request to adjust the schedules on those service needs set for FY ’11 and ’12, Roughead replied: “I haven’t the foggiest idea.”