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B
Analysis of Department of the Navy Funding Trends
The overall Department of the Navy funding by Service is
depicted in Figure B.1.1 It shows
a significant decline in funding for both the Navy and the Marine
Corps from FY 1991 through FY 1994 and then a leveling out through
FY 1999.
The Marine Corps share of the Department of the Navy budget has
increased from 13.5 percent in FY 1991 to 16.2 percent in FY 1999
and continues to increase at an average rate of 0.3 percent per
year, as shown in Figure B.2.
The funding for the overall Department of the Navy and for the
two Services is depicted in Figures B.3, B.4, and B.5.
Department of the Navy funding was broken down into three
categories: (1) infrastructure using the OSD (Program Analysis and
Evaluation [PA&E] definitions of infrastructure; (2) force
operations using the O&M and military personnel appropriations
in the OSD (PA&E) definitions of forces; and (3) force
modernization using the research, development, test, and evaluation
(RDT&E), procurement, and military construction appropriations
in the OSD (PA&E) definitions of forces.
In almost every case there is a clear difference in funding
trends between FY 1991–1994 and FY 1995–1999. The
funding trends appear to show that force modernization bore the
brunt of the overall budget reductions and then recovered
1Unless
otherwise noted, all data shown in this appendix are a result of
the committee's use of FY 1999–2003: President's Budget
Future Years Defense Programs. In addition, please note that all
data are shown in constant FY 1999 budget dollars: FY 1991 through
FY 1997 are actual obligations, FY 1998 is the current budget in
execution, and FY 1999 is the President's budget currently being
considered by Congress.
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Figure B.1
Funding for Department of the Navy programs, 1991–1999.
Figure B.2
Marine Corps percentage of Department of the Navy (DON) total
obligational
authority (TOA), 1991–1999.
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Figure B.3
Funding for Department of the Navy programs, 1991–1999.
Figure B.4
Funding for U.S. Navy programs, 1991–1999.
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Figure B.5
Funding for U.S. Marine Corps programs, 1991–1999.
slightly from FY 1995 to 1999. Navy programs follow a similar
pattern, but the magnitude of the reductions is somewhat greater
and is depicted in Figure B.4. Marine Corps (USMC) programs have
smaller declines and larger increases and are depicted in Figure
B.5.
Table B.1 depicts the results of an analysis to determine if and
to what extent there were resource transfers between programs and
Services during the period between FY 1991 and FY 1999. The first
column lists the categories; the second column is FY 1991 funding
in billions of FY 1999 dollars; the third column is FY 1999 funding
in billions of dollars; the fourth column shows the reduction in
funding from FY 1991 to FY 1999; the fifth column lists the percent
reduction by category from FY 1991 to FY 1999; the sixth column
indicates the FY 1999 funding that would have occurred if each
category were reduced by the same Navy Department overall
percentage; and the seventh and last column represents the
difference between actual FY 1999 funding and the normalized FY
1999 funding. This last column indicates the degree to which a
category had funding transferred either into it (a positive number)
or out of it (a negative value).
This analysis shows that Navy modernization was the bill payer
for the overall Navy Department budget reductions and resulted in
an excess $3.5 billion reduction that must be recouped from other
programs in order to reestablish the former funding relationships
of about a decade ago and continue capitalization of the Navy. If
Navy modernization requirements exceed the former share
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TABLE B.1 Resource Transfers Between
Programs and Services (in billions of FY 1999 dollars)
FY 1991 to FY 1999
Category
FY 1991
FY 1999
Reduction in Funding
Percent Change
Normalized FY 1999
Transfer
Department of the Navy
Modernization
$41.6
$24.8
$16.8
40
$27.9
-$3.1
Operations
$35.0
$24.7
$10.4
30
$23.5
$1.2
Infrastructure
$44.8
$32.0
$12.9
29
$30.0
$1.9
Total
$121.4
$81.5
$40.0
33
$81.5
$0.0
Navy
Modernization
$38.6
$22.4
$16.2
42
$25.9
-$3.5
Operations
$27.7
$19.2
$8.5
31
$18.6
$0.6
Infrastructure
$38.7
$26.7
$12.0
31
$25.9
$0.7
Total
$105.0
$68.3
$36.7
35
$70.4
-$2.1
USMC
Modernization
$3.0
$2.4
$0.6
20
$2.0
$0.4
Operations
$7.3
$5.5
$1.8
25
$4.9
$0.6
Infrastructure
$6.1
$5.3
$0.8
14
$4.1
$1.2
Total
$16.4
$13.2
$3.3
20
$11.0
$2.1
NOTE: Totals may not add due to rounding.
of the Navy Department budget or it is necessary to continue to
increase the Marine Corps share of the budget, the $3.5 billion
figure must be adjusted upward accordingly.
For the reasons articulated in Chapter 1, the committee focused
its review on the approximate half of the Navy infrastructure that
is more closely associated with the N4 organization (i.e., those
portions of the infrastructure concentrated on base closure and
environmental compliance, installations (less base closure),
central logistics, and quality of life). The total Navy
infrastructure and the portion initially considered by the
committee are depicted in Figure B.6.
The committee also looked at infrastructure by appropriation
since different offices in OSD and different committees in Congress
review different parts of the budget by appropriation. Not
surprisingly, the O&M account and the MPN account make up the
majority of the funding for infrastructure. This result is
displayed in Figure B.7 for both the total infrastructure and the
portion reviewed by the committee.
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Figure B.6
Navy infrastructure by functional categories initially considered
by the committee.
Data shown are average values from FY 1995 to FY 1999.
Figure B.7
Navy infrastructure by appropriation initially considered by the
committee. Data
shown are average values from FY 1995 to FY 1999.
Representative terms from entire chapter:
navy infrastructure
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