The Navy on Tuesday released its $164.9 billion budget request for fiscal year 2017, which includes $33.3 billion for ship, aircraft and weapon procurement.

The Virginia-class attack submarine USS Mississippi (SSN 782) departs Joint Base Pearl Harbor-Hickam for routine operations. General Dynamics' sales in the quarter benefited from work on the Block IV version of the class. Photo: U.S. Navy
The Virginia-class attack submarine USS Mississippi (SSN 782) departs Joint Base Pearl Harbor-Hickam for routine operations. General Dynamics’ sales in the quarter benefited from work on the Block IV version of the class. Photo: U.S. Navy

The service emphasized increasing its investments on future munitions and undersea warfare at the expense to some shipbuilding and aircraft procurement. One of the biggest tradeoffs comes as the result of a 12-vessel cut to the Littoral Combat Ship (LCS) program of record. Instead of procuring a total 52 LCS and fast frigates (FF), the service will buy 40 total and one fewer LCS in 2017 than originally planned.

The Department of Navy (DON), which includes both the Navy and Marine Corps, requested $155.4 billion in base expenses and $9.5 billion for Overseas Contingency Operations in 2017.

Ultimately, the DON took an $8 billion hit in 2017 any way the budget is sliced. The 2017 request gives the Navy and Marine Corps $8.2 billion less to work with than in 2016, and does not meet the amount of funding the services predicted it would need last year. The 2016 president’s budget request projected a request of $161 billion in 2016 constant dollars for the services in 2017. The DON 2017 request—$152.9 billion in 2016 dollars—is about $8 billion less than that.

The Navy requested funding buy seven ships in fiscal year 2017 and 38 ships over the next five years, which will bring it to a total of 308 vessels in 2021. The service allotted $5.2 billion for two Virginia-class attack submarines, $3.2 billion for two Arleigh Burke-class destroyers, $1.1 billion for two LCS and one LHA amphibious assault ship, as well as continued funding for the design and construction of the USS John F. Kennedy (CVN-79) and advanced procurement funds for the Ohio replacement submarine program.

Deputy Defense Secretary Robert Work said cutting the LCS buy to 40 would ultimately create a stronger, more balanced Navy because it would be able to make additional investments in torpedoes, advanced munitions, P-8A maritime aircraft and tactical aviation assets.  

“If you take a look at last year’s plan, the Navy was going to build up to 321 ships and then come down. We asked ourselves what can’t we buy because we’re going from 308 to 321?” The answer was a lot of capability, he said. “This is not an indictment against the LCS. If we didn’t like the ship, we would stop buying it.”

Although the service will ultimately have fewer ships with which to meet demands, the Navy will still reach a 300-vessel fleet in fiscal 2019 and stay above that level until 2030, he said.

In the realm of unmanned aviation, the Navy announced a major change to its carrier based drone program. Instead of procuring an unmanned aircraft known as the Unmanned Carrier Launched Air Surveillance and Strike (UCLASS) system, which would be capable of gathering intelligence and striking targets, the service will move forward with an unmanned tanker called the Carrier Based Aerial Refueling System.

CBARS will not only be able to conduct aerial refueling, it will have the capability to do limited strike and conduct long endurance intelligence, surveillance and reconnaissance (ISR), said Rear Adm. William Lescher, deputy assistant secretary of the Navy for budget,. “It’s the total package of those required capabilities that essentially is being sought with this.”

The 2017 budget calls for an $89 million investment into CBARS, about one-fifth the amount of funding UCLASS was getting per year. However, that amount of money may increase as the program moves forward, he said.

Compared to CBARS, UCLASS was a “much more aggressive” capability focused on penetrating strike and collecting ISR in a non-permissive environment, Lescher said. CBARS can be developed more quickly and will allow the service to practice operating off the carrier deck before its initial operational capability in the mid 2020s.

The service is also prioritizing undersea warfare. The service requested $773 million in 2017 for advance procurement of the Ohio-class submarine replacement, as well as $37 million to improve the Mk 48 torpedo and $106 million for unmanned underwater vehicles (UUVs). The next multiyear procurement contract for the Virginia-class submarine, which will start in fiscal 2019, will include three submarines to be outfitted with the Virginia Payload Module that more than triples the amount of Tomahawk missiles that can be carried on each submarine.

Curiously, some of the additions to the Navy’s munitions budget alluded to by Defense Secretary Ashton Carter last week were not present in the budget, including the addition of $2 billion for more than 4,000 Tomahawk missiles. Instead, the department plans on procuring 100 Tomahawks in 2017, which is not enough to meet Raytheon’s [RTN] minimum sustaining rate.

Procurement of the long range anti-ship missile (LRASM) begins with 10 missiles in 2017 and 25 units the following two years, but production ends after that. The service also starts its procurement of the Longbow Hellfire missile for the LCS, buying 24 missiles in 2017 and 110 per year through the end of the FYDP.

The Department of Navy budget includes procurement funding for 476 Navy and Marine Corps manned and unmanned aircraft over the future years defense program, which projects the next five years of defense spending. The Navy plans to slowly ramp up its procurement of Lockheed Martin’s F-35C Joint Strike Fighter over the coming years, buying four in 2017 and 64 over the FYDP.

Boeing’s [BA] F/A-18E/F Super Hornet production line also got a reprieve, at least for another couple years. The 2017 request includes funds for two Super Hornets in 2017 and 14 in 2018 to help alleviate a fighter shortfall. The Navy also plans to buy 11 Boeing P-8A maritime multimission aircraft in 2017.

The service will begin procurement of the first 24 carrier onboard delivery Ospreys, recently designated the CMV-22B, in fiscal 2018.

It plans to buy only one MQ-8C Fire Scout and two MQ-4C Tritons in 2017 because of accelerated procurement of the unmanned aerial systems in prior years.

The service also requested $55 million to establish a dedicated rapid prototyping fund.

“FY 2017 efforts will address warfighting gaps with prototyping development and experimentation projects,” budget documents stated. The service will finalize focus areas for prototyping efforts in 2017 by the end of the current fiscal year.