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2015 Decisions Could Create New Costs Later

The top defense policy Democrat in the House said Thursday that the military authorization legislation being marked up by the Armed Services panel would create a bow wave of funding shortfalls in fiscal 2016 as lawmakers try to defer tough budget choices in fiscal 2015.

Adam Smith of Washington, the committee's ranking Democrat, said the Republican leadership's defense policy bill ( HR 4435 )  is deferring difficult decisions on proposed military entitlement reductions affecting medical care, commissary subsidies and housing allowances that would save about $2 billion, and adding costs, such as $700 million to begin refueling an aircraft carrier.

"What we are doing right now is we are battling over 2015 dollars," Smith said during an event put on by the Center for Strategic and Budgetary Assessments. "The big problem here is the bow wave problem and this is before you even get to sequestration."

Smith made his comments as subcommittees prepared for two more markups on the authorization bill Thursday, after four panels approved their sections of the measure on Wednesday.

Most amendments will be offered to the bill when it goes to full committee May 7. Smith said he planned to offer an amendment when the bill reaches the House floor calling for implementation of a Base Realignment and Closure Commission, as the administration requested. He said he has no plans to offer amendments during full committee debate because it serves no purpose to "get crushed," which has the effect of taking an issue off the table.

In the case of a BRAC amendment, Smith said it was time to introduce it as a topic. The military has argued that it has at least 25 percent more facilities than it needs, and that percentage will only increase as forces shrink as a result of congressionally mandated cuts. Many lawmakers oppose a BRAC because it would carry up-front costs they say the military can ill afford right now.

But by delaying decisions that ultimately would save significant money, Smith said Congress is creating larger problems in coming years when budgets are expected to grow even tighter. Smith cited, for example, the retirement of the venerable A-10 attack aircraft.

"If we can find $400 million we can save the A-10," Smith said some have argued on the panel. "That is a daunting challenge in this budget environment, but it also is not realistic. If we save the A-10 this year over the course of five years the cost is $3.5 billion. Where are you going to find the other $3.1 billion? You have just created a bow wave."

Another example is the resistance on the House Armed Services panel to the idea of laying up eight cruisers and three amphibious ships, which would enable the military to modernize those ships at a far lower cost. Doing so would save about $4.5 billion over five years.

"So the big problem right now is we are avoiding all these big decisions now," he said. "The analogy I'm always reminded of is well, 'we're painting ourselves into a corner.' We're just going to run out of floor space at some point."

Some senior GOP aides reply to Smith's criticisms by saying the full committee chairman's mark will prescribe ways to keep spending within congressionally mandated limits ( PL 112-25 , PL 113-67 ).

But another Republican staffer suggested that concerns about a bow wave are valid.

Smith said a failure to accept reductions proposed by the military could result in raiding operations and maintenance accounts that include accounts important to military readiness, such as training.

At the same time, Todd Harrison, a defense budget analyst for the Center for Strategic and Budgetary Assessments, said Congress and the Pentagon were able to shift about $30 billion in fiscal 2014 in typically base budget expenses into the Overseas Contingency Operations fund, used to pay for the war in Afghanistan and the global war on terror.

Smith said it's "quite possible" that Congress would again shift costs to that contingency fund to pay for decisions in fiscal 2015 to reject Pentagon-suggested cuts.

"It is a logical thing to do," Smith said, though he acknowledged the apparent dysfunction of setting spending limits and then circumventing them as a matter of standard operations.