They say you can read people’s priorities by how they spend their money. As a GovCon, you know that holds true for the federal government as well.
The Department of Defense (DOD) budget brings good news if your firm does business in the defense technology research realm. Funding for Research, Development, Test, and Evaluation (RDT&E) activities is up 10% for fiscal year (FY) 2020 to $109 billion. The increase continues a growth pattern that has seen RDT&E spending increase by $42 billion over the last five years.
Are you looking to capture your share of the spend? A recent budget analysis by the American Institute of Physics (AIP) notes that Congress strongly supports the military’s effort to speed maturation and fielding of advanced technological systems. While funding for early-stage R&D increased moderately, the bulk of additional funding went to late-stage prototyping and testing work.
AIP tagged these five areas as RDT&E priorities for FY 2020:
Hypersonics
Hypersonic weapons are those that can travel more than five times the speed of sound—about one mile per second. There are two types. Hypersonic cruise missiles are powered by rockets or jets throughout their flight, similar to (but faster than) existing cruise missiles. Hypersonic glide vehicles fly lower, more swiftly, and quicker, at up to 10 miles per second. Budget appropriations include:
- $576 million for Air Force hypersonics prototyping.
- $404 million for a new Army program to develop a land-based, long-range hypersonic weapon.
- $390 million for a Missile Defense Agency hypersonic defense program.
- $108 million for a separate Missile Defense Agency hypersonic and ballistic missile tracking space sensor program.
For a glimpse of where DOD may be headed with procurement in the future, watch the Joint Hypersonics Transition Office. It received $100 million to be used in part to produce an integrated science and technology roadmap for hypersonics development.
Missile Warning Satellites
The RDT&E budget allots $1.5 billion for the Air Force’s space-based missile early warning system, dubbed Next-Generation Overhead Persistent Infrared (Next-Gen OPIR). The program is being administered under accelerated acquisition authority. For another glimpse of the DOD’s future plans, watch for a detailed strategy for space-based missile detection. Senate appropriators directed DOD to develop the plan within 270 days.
Weather Satellites
Each year before directly funding DOD, Congress enacts the National Defense Authorization Act to set out spending and policies for the department. The act directs the Air Force to launch a “pathfinder” environmental monitoring satellite or hosted payload by 2023 and an electro-optical/infrared weather satellite by October 2025. To that end, the DOD budget allots:
- $206 million for the Air Force’s next-generation environmental satellite system, the Weather System Follow-On. To find out where RDT&E is headed with this technology, look for the Air Force’s “weather enterprise strategy,” which Congress ordered to be completed in 180 days.
- $126 million for the development of electro-optical weather systems. These satellites track weather using electro-optical infrared (EO/IR) imagers that monitor both visible and infrared wavelengths to provide feedback night and day and in challenging environmental conditions.
Strategic Capabilities Office
The principal mission of DOD’s Strategic Capabilities Office (SCO) is to drive innovation through exploring novel uses for existing or near-term advanced technologies and get them into the hands of troops in under five years. SCO reports to the deputy secretary of defense. The office has seen a rapid period of growth, and although the FY 2020 budget is down by $200 million, it still totals $12.2 billion. Artificial intelligence and machine learning are top priorities.
5G Telecommunications
Congress allotted $200 million this year for DOD’s Next Generation Information Communications Technology program, created in 2019 to:
- Accelerate 5G development of equipment with dual military and civilian uses.
- Encourage DOD collaboration with industry and academia on 5G.
- Develop means of sharing spectrum in congested environments.
AIP provides a Federal Science Budget Tracker to follow the money for DOD technology research in more detail.
CAVU understands that tracking federal budgets and targeting agency clients is only the beginning. When you bid on those tech contracts, will you be DCAA compliant? Have you carefully calculated your strategy on cost volume and indirect rate? Reach out to our expert government contracting accounting specialists to help you crunch the numbers that keep you competitive.