The following is the Nov. 8, 2017 Congressional Research Service report, FY2018 National Defense Authorization Act.
From the report:
This report discusses the FY2018 defense budget request and provides a summary of congressional action on the National Defense Authorization Act (NDAA) for fiscal year (FY) 2018. The annual NDAA authorizes appropriations for the Department of Defense (DOD) and defense-related nuclear energy programs of the Department of Energy and typically includes provisions affecting DOD policies or organization. Unlike an appropriations bill, the NDAA does not provide budget authority for government activities.
The Trump Administration’s FY2018 budget request, released on May 23, 2017, included a total of $677.1 billion for national defense-related activities of the federal government. Of that amount, $667.6 billion was for discretionary funding that would be provided by an annual appropriations bill. Of that discretionary defense spending request, $659.8 billion was for appropriation accounts for which authorization is provided in the annual NDAA.
The FY2018 request included $595.3 billion in discretionary funding for the so-called DOD base budget, that is, funds intended to pay for activities that DOD and other national defense-related agencies would pursue even if U.S. forces were not engaged in contingency operations in Afghanistan, Iraq, Syria and elsewhere. The remainder of the request – $64.6 billion – would fund the incremental cost of those ongoing operations, formally designated as Overseas Contingency Operations (OCO).
Congressional action on FY2018 defense funding reflects a running debate about the size of the defense budget given strategic environment and budgetary issues facing the United States. Annual limits on discretionary spending for defense and for non-defense federal activities, set by the Budget Control Act of 2011 (P.L. 112-25), remain in place through FY2021. If the amount appropriated for either category exceeds the relevant cap, it would trigger near-across-the-board reductions to a level allowed by the cap – a process called sequestration. Appropriations designated by Congress and the President as funding for OCO or for emergencies, are exempt from the caps.
For FY2018, the BCA limit on discretionary defense spending is $549 billion. Even apart from the request for $8.1 billion in defense-related discretionary appropriations that is outside the scope of the NDAA, the Administration’s base budget defense request would exceed the BCA cap by more than $46 billion, thus triggering sequestration.
The House passed H.R. 2810, the version of the FY2018 NDAA reported by the House Armed Services Committee, on July 14, 2017 by a vote of 344-81. On July 10, the Senate Armed Services Committee reported S. 1519, its version of the FY2018 bill. After substituting the text of S. 1519 for the House-passed text of H.R. 2810, the Senate passed an amended version of the latter bill on September 18 by a vote of 89-8.
In terms of the total amounts they would authorize (counting funds for base budget and OCO) the House and Senate proposals differ by slightly more than $3 billion (less than 0.5%). The House bill’s $689.0 billion total would exceed the Administration’s request by $29.2 billion (about 4.4%), whereas the Senate proposal would exceed the request by $32.3 billion or about 4.8%. The differences between the two bills reflect, in large part, differences in how the chambers categorize and allocate funding for base budget purposes while minimizing the amount by which base budget spending would exceed the BCA cap. Neither bill would modify the FY2018 BCA limit.