Virginia-class submarines,“executable” surface ships and nuclear modernization are exempt from a budget effort led by Defense Secretary Pete Hegseth to shift $50 billion in Pentagon funds to Trump administration priorities, USNI News has learned.
The offsets, due on Feb. 24, are part of an overall Fiscal Year 2026 budget “relook” that will reshape the Pentagon’s spending priorities in line with guidance from the White House Office of Management and Budget and move through the office the deputy defense secretary and the office of the director of Cost Assessment and Program Evaluation.
“The Department will develop a list of potential offsets that could be used to fund these priorities, as well as to refocus the Department on its core mission of deterring and winning wars,” reads a Wednesday press statement.
“The offsets are targeted at 8% of the Biden Administration’s FY26 budget, totaling around $50 billion, which will then be spent on programs aligned with President Trump’s priorities.”
In a Feb. 18 memo to senior Pentagon leadership and combatant commanders, Hegseth provided a loose outline of his priorities for the budget.
“The time for preparation is over — we must urgently act to revive the warrior ethos, rebuild our military, and reestablish deterrence. Our budget request will resource the fighting force we need, cease unnecessary spending, reject excessive bureaucracy and drive actionable reform including progress on the audit,” Hegseth wrote.
“To support our warfighters, I ask the Military Departments and DoD Components resource the capabilities and readiness necessary for a wartime tempo and offset those requirements with low-impact items like wasteful DEI and climate change programs.”
Included in the memo are 17 areas Hegseth said are immune to reductions, including DoD activities at the U.S. southern border, one-way attack drones, systems to counter unmanned aerial vehicles, nuclear modernization, homeland missile defense, collaborative combat aircraft and support funding for U.S. Indo-Pacific Command, U.S. Space Command, U.S. Transportation Command, U.S. Strategic Command, U.S Cyber Command and U.S. Northern Command.
While not its own line item, the Columbia-class ballistic missile submarine is understood to be “safe from cuts” as part of the nuclear modernization line item, two legislative sources told USNI News. For the last decade, the replacement of the sea-based portion of America’s nuclear triad has been the Pentagon’s number one acquisition priority.
“Columbia by itself deserves one of those lines because it’s so big and it’s been such a big priority for so long,” Brent Sadler, a retired submariner who is a senior research fellow at the Heritage Foundation, told USNI News. “So it doesn’t sit well with me that it’s not called out explicitly.”
It was not immediately clear what “executable” surface ships meant in the exempt line item. A Navy official referred USNI News to the Office of the Secretary of Defense when asked on Thursday.
Bryan Clark, a senior fellow with the Hudson Institute, compared Hegseth’s budget effort to one executed in the early 2000s by former President George W. Bush’s defense secretary, Donald Rumsfeld.
“It’d be kind of like the 2001 period when they had to show everything was transformational to Rumsfeld to be able to keep it in the program,” Clark told USNI News. “And I think here you’re going to have to show that things are incorporating these new uncrewed technologies to stay in the program. So for the carrier to be relevant, it’s going to have to have an air wing that’s got a much larger uncrewed component in the future. So these two things go together.”
A potential dual carrier buy that industry has pushed for could be on the chopping block, Clark said.
“The Navy’s looking for an alternative to protect the carrier industrial base, but at a lower rate of production,” Clark, a former submariner, told USNI News.
As of the last budget, the Navy planned to seek advanced procurement funding for the next Ford-class aircraft carrier in Fiscal Year 2027, with the full detailed design and construction contract award in 2030. The previous Trump administration proposed decommissioning an aircraft carrier as part of a two-carrier buy, a cost-savings move Congress rejected.
The F-35 Joint Strike Fighter Lightning II – variants of which the Navy, Marine Corps and Air Force purchase – was notably not included in the list of programs that are off the table in the relook. If the Navy and Marine Corps opt to buy fewer F-35Cs, Clark said they’d need to look to other platforms like unmanned assets for the air wing when the F/A-18 Super Hornets start to retire in the 2030s. Funding for Collaborative combat aircraft, or drones, is also safe from reductions, according to the memo.
Sadler said he’s skeptical a potential decrease in aircraft carrier production would survive scrutiny.
“The Navy is so far behind in its delivery of platforms that I can’t see any argument to pull back a program that’s already on track, or at least sort of on track,” Sadler told USNI News. “But at least pulling back on a program that’s been building for a while now to try to defund it and slow it down, it doesn’t make sense to me, not when you look at the threat.”
Both Sadler and Clark said they think the new administration will emphasize uncrewed systems and new technologies and seek to develop them more quickly.
As for the Columbia-class boats, Clark said the new administration may not view recapitalizing the sea-based leg of the nuclear triad as its top priority.
“They would say their primary acquisition is probably nuclear attack submarines, so attack submarines that use conventional weapons as opposed to nuclear weapons,” Clark said.
“The current team coming in views the nuclear complex as a necessary investment in the ultimate backstop,” he continued. “They’re not going to pursue new nuclear weapons that are expensive investments to bolster that ultimate backstop.”
The Constellation-class frigate, which is facing years of delays due to ongoing design changes and workforce challenges at the Marinette, Wis., yard, may also be in trouble.
“It’s an easy kill. They haven’t started really building it yet. They’ve done some work on the first hull, but it’s easy to stop that at this point,” Clark said of the frigate. “They’d be deferring a bunch of potential future costs without losing a bunch of money that’s already been spent.”
Sadler said he thinks the Navy should stick with the frigate program despite its ongoing problems, but acknowledged its likely a topic of conversation as the service looks to reallocate funds.
“The frigate’s the one that’s probably the most in danger in all of this,” he said. “There’s going to be a lot of scrutiny on the survivability of that contract.”
