1. Planning, Programming, Budgeting, and Execution (PPBE) Process
I’m __________ and I’ll be discussing PPBE with you today. First, a little about my background…….
PPBE is one of the three major decision support systems in the weapon system acquisition business. The other two, JCIDS and the acquisition management system, have already been discussed.
Roberta Tomasini
Professor of Financial Management
Defense Acquisition University

2. Acquisition Program Baseline Commitment Reprogramming
From Requirement to Capability
Planning, Programming,
Budgeting and Execution
Life Cycle
Cost
Annual
Funding
Cost
Analysis
Estimate
ICE
Funding
Policies
Full
Funding (Exceptions)
FYDP DPPG POM RMD
MFP PE BES FEA
CAIV
CCA
Fiscal
Environment
Incremental
Funding
MBIs
POE
AoA
Congressional
Enactment
HAC HASC HBC
SAC SASC SBC
President’s
Budget
Budget
Resolution
Authorization
&
Appropriation
Laws
This chart is intended to show how we get from “Requirement” to “Capability” from a Financial Management perspective…..
Starting with the lower left cloud, “Operational Concept”, as this is where it all starts for any discipline in acquisition. Operational Concept is the same as JCIDS plus. It includes the capability documents generated through the JCIDS process as well as a capabilities- based analysis and all acquisition programs have an acquisition program baseline (APB), which is a signed document between the program manager and the milestone decision authority in the acquisition chain of command. The agreement is on cost, schedule and performance parameters for a specific program.
Operational concept leads to the first major area of Financial Management (FM), “Cost Analysis”. This includes doing a cost estimate, which is the foundation for the rest of the FM process.
The second major area of FM is “Funding Policies”. This involves taking the cost estimate and turning it into a budget. Understanding funding policies is an important part of developing the budget.
The third major area of FM is “PPBE”. This is the DoD process for allocating resources. We take a budget and submit it up the chain to get buy-in from our service/agency and OSD. This session will focus on this area.
The end of the PPBE process is the president’s budget submission to Congress. This leads to the fourth area of FM, “Congressional Enactment”.
The end of “Congressional Enactment” is the Authorization and Appropriation laws, which leads to the fifth and final area of FM, “Budget Execution”. Budget execution relates to actual appropriated funds.
Now let’s focus on PPBE.
Acquisition Program Baseline
Operational
Concept
Force Structure
Modernization
Operational Capability
Readiness
Sustainability
Feedback
Commitment Reprogramming
Capabilities-Based
Assessment
Capability Docs
Budget Authority Obligation Expenditure Outlay
Budget
Execution

3. PPBE Process and Schedule Capability Portfolio Managers
PPBE Outline
PPBE Overview
Management Systems and Phases
Major Changes in FY PPBE Cycle
Front End Assessments
DoD Efficiencies Initiative
Building Blocks
FYDP, MFP, Program Elements
PPBE Process and Schedule
Capability Portfolio Managers
Membership of DAWG and SLRG
Resource Allocation Process
This is the outline for the PPBE session.
There are couple of overview charts…
There are a few charts on the PPBE building blocks…..namely, FYDP (the Future Years Defense Program, MFP (Major Force Programs), and program elements.
This will be followed by the timing, key players, and key documents in the PPBE process.
Lastly, there are charts of the schedule for this PPBE cycle, which is FY10-15.

4. Three Major DoD Management Systems
Planning,
Programming,
Budgeting and
Execution
QDR
Joint Capabilities
Integration and
Development
System (JCIDS)
Defense
Acquisition
System
-DoD has three Decision-making Support Systems
-1. AMS (Acquisition Management System)
-- how we acquire weapon systems
-- primary document is DoDI
-- also referred to as little “a” acquisition
-- event driven process
2. JCIDS
--determines what is needed
-- primary document is CJCSI 3170, which is capabilities-based with more emphasis on jointness
-3. PPBE
-- resource allocation in DoD – providing warfighter with best mix of forces, equipment and support attainable under fiscal constraints
-- increased emphasis on using performance metrics to focus on output, return on investment
-- Calendar driven
-QDR: the major statement of defense strategy and business policy
--MID 913 states that QDR is the single hierarchical link integrating all internal decision processes
-JCIDS and AMS are event-driven; PPBE is calendar-driven, backing off from the PB
-All three circles form “Big “A” Acquisition

5. Resource Management System
PPBE is the Primary Resource Management System for DoD:
Articulates strategy
Identifies size, structure and equipment for military forces
Sets programming priorities
Allocates resources
Evaluates actual output against planned performance and adjusts resources as appropriate
PPBE is the primary resource management system for DoD for all appropriated funding – not unique to weapon system acquisition.
Only minor changes since developed by McNamara in 1961
Allows for DoD to review it’s mission/strategies bottom up every two years
What do we do in PPBE?
Strategy - How are we going to defend the nation? National Goals
Forces - What are we going to use to defend the nation? to execute that Strategy?
Prioritize - Which ones, which programs will be funded now?
Resources - How much will be spent on each program?
Output - Where are we getting our best return?
There are three phases in PPBE as shown on the next chart.

6. PPBE Phases Planning (OSD Policy) Programming (OSD CAPE)
Assess capabilities / review threat
Develop guidance
Programming (OSD CAPE)
Turn guidance into achievable, affordable packages
Five-year program (Future Years Defense Program)
Budgeting (OSD Comptroller)
Test for efficient funds execution
Scrub budget year
Prepare defensible budget
Execution Review (concurrent with program/budget review)
Develop performance metrics
Assess actual output against planned performance
Adjust resources to achieve desired performance goals
Brief Overview of PPBE phases: There are three phases: planning, programming and budgeting. The major difference is that we now have a review of program execution/program performance concurrent with the program and budget review (NOT Army’s PPBES)
Planning: QDR 2001 shifted the basis of defense planning from a "threat-based" model that dominated thinking in the past to a "capabilities-based" model
Capabilities-based model:
– Focuses on how an adversary might fight rather than specifically who the adversary might be or where a war might occur.
– Recognizes that it is not enough to plan for large conventional wars in distant theaters. Instead, the United States must identify the capabilities required to deter and defeat adversaries who will rely on surprise, deception, and asymmetric warfare to achieve their objectives.
Strategic Planning Guidance (SPG)/Guidance for the Development of the Forces (GDF) and Joint Programming Guidance (JPG): Marching Orders for next phase
Programming:
Components develop Program submissions based on guidance developed in the Planning phase
OSD, OMB & Joint Staff review for priority, affordability
Info captured in the FYDP
Budgeting:
Components develop budget submissions
OSD(C) reviews budget inputs, with emphasis on funds execution
Ultimate aim, to submit a defensible President’s Budget thru OMB to Congress
Execution Review
Overlays both Program Review and Budget Review processes
In past emphasis on input, “how much to spend on each program”; now emphasis is on output, “what are we getting for our money?”
Using performance metrics to examine program execution
Let’s look at the years reviewed in the PPBE process…

7. One budget year (was two on the “on years”)
4 Major Changes in the FY PPBE Cycle DepSecDef memo, dated 9 Apr 10
DPPG (was GDF and JPG)
One budget year (was two on the “on years”)
Makes this an annual budget cycle vs a biennial budget
Every year is a “POM” year
No more PRs (Navy), APOMs (AF), or mini-POMs (Army)
Focus on a 5-year period
Changed FY12-17 period to FY 12-16
DOD conducting Front End Assessments
Eight issues with SecDef oversight via the “Large Group”
All other issues led by DepSecDef via the DAWG

8. Front End Assessments SecDef memo, dated 11 May 10
Strategic Comm and Info Operations
Long Range Strike Family of Systems
Airborne ISR
Cyber Defense
Global Posture
Reset of Equipment from Operations
Integrated Air & Missile Defense
Tactical Aircraft

9. DoD Savings and Efficiencies Initiative as of 28 Jun 10
$B FY12 FY13 FY14 FY15 FY16 Total
Army, Navy, Air Force
Def Agency/Field Activity
Combined Goal

10. OSD (C) Fact Sheet Savings and Efficiencies Initiative
Goal: Create more agile, flatter, and efficient organization
Military departments can keep their savings and apply to critical areas such as
Personnel in units
Force structure
Readiness to fight
Investment in future capabilities
Goals will be reviewed annually and may change
Initiatives must be specific, actionable, and measurable
Percentage and across-the-board reductions are not acceptable
No organization, including OSD, is excluded
Must be in POM/BES FY submission to OSD due 30 Jul 10

11. Better Buying Power USD(AT&L) 14 Sep 10 Memo
Target Affordability and Control Cost Growth
Mandate affordability as a requirement
Drive productivity growth through Will Cost/Should Cost management
Eliminate redundancy within warfighter portfolios
Make production rates economical and hold them stable
Set shorter program timelines and manage to them
Incentivize Productivity and Innovation in Industry
Reward contractors for successful supply chain and indirect expense management
Increase use of FPIF, where appropriate
Use 50/50 share and 120% ceiling as point of departure
Adjust progress payments to incentivize performance
Extend the Navy’s preferred supplier program to a DoD-wide pilot
Reinvigorate industry’s IRAD and protect the defense technology base
Promote Real Competition
Present a competitive strategy at each program milestone
Remove obstacles to competition
Require open systems architecture and set rules for acquisition of technical data rights
Increase dynamic small business role in defense marketplace competition

12. Better Buying Power (cont.) USD(AT&L) 14 Sep 10 Memo
Improve Tradecraft in Services Acquisition
Create a senior manager for acquisition of services in each component, following the Air Force’s example
Adopt uniform taxonomy for different types of services
Address causes of poor tradecraft in service acquisition
Increase small business participation in providing services
Reduce Non-Predictive Processes and Bureaucracy
Reduce number of OSD level reviews…
Eliminate low-value added statutory processes
Reduce by half, the volume and cost of internal and congressional reports
Reduce non-value-added overhead imposed on industry
Align DCMA and DCAA processes to ensure work is complimentary
Increase use of Forward Pricing Rate Recommendations to reduce admin costs

13. Future Years Defense Program (FYDP)
Computer database maintained by CAPE
Contains approved force structure and resources for all Defense Programs
Updated two times per annual PPBE cycle:
Program Objectives Memorandum/Budget Estimate Submission (POM/BES) – July
President’s Budget (PB) - February
Reflects PY, CY, BY, + 4 Out-Years +
3 additional years for force structure only
FYDP (updated CY 2010) would include:
FY for force structure & resources
FY for force structure only
Computer database maintained by Dir (PA&E)
Summarizes forces, equipment, and resources
Comprises one prior year (PY), the current year (CY), the “biennial” budget years (BY1 and BY2), four additional years for resources (POM) and three additional years for force structure only
It is a “living” record reflecting the decisions made in the various phases of PPBE
Updated two times per year to reflect the
POM/BES (Aug/Sep), and
President’s Budget (Jan/Feb) submissions
Why two budget years?
The process was intended to produce a two year budget. However, Congress appropriates one year at a time. So, we have “off-years/odd-years”. Originally, OSD and the Components were expected to “tweak” the 2nd year of the President’s Budget/POM as part of an off year effort
APOM by the Air Force
Mini-POM by the Army
Program Review by the Navy
However, there have been changes in this off-year/odd-year process, starting in calendar year 2003.
TRANSITION: Let’s take a look at how the FYDP is structured 10 11 12 13

14. Future Years Defense Program (FYDP)
DOD APPROPRIATIONS
Military Construction
Military Personnel
RDT&E
Procurement
Ops & Maintenance
Other D E F O A
Strategic Forces
(1) T I A
General Purpose Forces
(2) R G H E E
Command, Control, Comm, Intell & Space
(3) N F N R
MAJOR FORCE PROGRAMS A A
Mobility Forces
(4) O C R V I
Guard & Reserve Forces
(5) R M Y C E
Teaching Points:
Data is divided into 11 “Major Force Programs” (MFP) for DoD internal management uses during the planning and programming phases of PPBE.
Data is also divided into five Appropriation categories (plus one catch-all “other” category, which simply represents the various other appropriations that exist -- although we in the acquisition community are not normally very interested in their details) for use by Congress when reviewing budget requests and enacting budget authority.
Data is also divided into service or component categories.
Important to note here that the data in any single category (for example: RDT&E, Army or Strategic Forces) from any one of the three major divisions (i.e., Appropriation, Component or MFP) can contain data from any or all of the remaining two major divisions (for example: Strategic Forces could contain data from all five appropriations and all four Components).
The lowest level of detail in the FYDP database is the program element, which is explained on the next chart…..
Research and Development
(6) Y E S
Central Supply & Maintenance
(7)
Training, Medical, & Other Personnel Activities
(8)
Administration and Associated Activities
(9)
DOD COMPONENTS
Support of Other Nations
(10)
Special Operations Forces
(11)

15. Program Elements
PROGRAM ELEMENT (PE): Smallest aggregation of resources normally controlled by OSD
- PE NUMBER: Used to track and identify resources; seven digit number followed by an alphabetic suffix
PROGRAM 1 ( STRATEGIC FORCES )
F - B-1B Squadrons
F - Peacekeeper Squadrons
N - Trident
A - Worldwide Joint Strategic Comm
F - SPACETRACK
PROGRAM 2 ( GENERAL PURPOSE FORCES )
A - Airborne Divisions
N - Frigates - Missile
F - F-22 Squadrons
F - Advanced Communications Systems
A - ARMY
N - NAVY
M - MARINE
F - AF
D - OSD
C - MDA
E - DARPA
J - JCS
S - DLA
BB - SOCOM
DBD - DFAS
Program Elements are the lowest level of detail in the FYDP database.
Program Elements are a tool OSD uses to track resources by program, system, or function so they can see how much is being spent on them.
PEs can be very broad, containing several programs. They also can be very specific, covering a single component of a weapon system. It all depends on the visibility OSD wants to maintain.
These are some examples of Program Elements (PEs), use F-22.
Seven digit code followed by a letter suffix designating the applicable component or agency.
The first two digits indicate the MFP to which the PE belongs. Although a PE is limited to a specific MFP, it is not in most cases, limited to a single Appropriation.
All programs and all resources have PEs. The entire FYDP database can be listed by PE. There are a few thousands of them.
Most acquisition programs have two program elements: one that begins with “06” for the development effort and one that begins with something other than “06” for the production and O&S effort.
Ref: DoD H

16. FEAs PPBE – Planning Phase President NSS NDS QDR DPPG NMS CPR
National Security Council
CIA/DIA/JCS/OSD
~Starts FEB/MAR (1st Year)
APR ( DPPG)/Sep ( FEAs)
Finish 2nd Year
FEAs
Planning Phase focus:
Threat vs Capabilities
Update strategy
Guidance for programming
Under direction of CAPE
NSS
FEAs to be a strategic view
used to inform program/budget reviews.
To Concurrent Program/Budget Review
NDS
QDR
DPPG
OSD
Level
JCS
NMS
CPR
Level
(JCS,
COCOMs,
SERVICES)
CIA – Central Intelligence Agency;COCOM – Combatant Command; CPR – Chairman’s Program Recommendation
DIA – Defense Intelligence Agency; DPPG –Defense Planning &Programming Guidance; JCS – Joint Chiefs of Staff
NDS – National Defense Strategy; NMS – National Military Strategy; NSS – National Security Strategy
OSD – Office of the Secretary of Defense; QDR – Quadrennial Defense Review; FEA – Front End Assessments

17. Concurrent Program/Budget Review
JUL
DEC
OCT
NOV
FEB
FEAs Continued
3-Star Group
OSD CAPE/
OMB
Issue
Resolution
POM
SECDEF/DEPSECDEF
SLRG*&DAWG*
CPMs
CPA
JCS
Components
Defense
Agencies
RMDs
TBD = *
Budget Review:
There are four areas considered by the USD(C) and OMB analysts as principal issue areas during the review and “scrub” of the budget submission from the Services and agencies: program pricing, program phasing, funding policies and program/budget execution.
Program Pricing - Examines whether the specific program has been priced out properly (e.g., that the budget was prepared on the basis of “most likely cost” of the work to be done and that the proper escalation index has been applied to the constant- year budget estimate to determine the current then-year funding requirement).
Program phasing - Examines the compatibility between the approved acquisition strategy and the funding necessary to pay for the requirements shown in that strategy (e.g., that have Procurement funds been phased properly to coincide with program plans for production).
Funding policies - Examines the compliance of the budget request with the proper policy for each specific appropriation category (e.g., RDT&E has been budgeted on an incremental basis; procurement and MILCON on a full funding basis; and O&M and MILPERS on an annual basis).
Program/Budget execution - Examines the efficiency with which an organization has executed (i.e., obligated and expended) currently available funds and the effect of current year execution on budget year submissions. As an example, has the organization met established goals for obligations and expenditures during the current fiscal year? If not, can those “excess” funds from the current fiscal year be allowed to slip into a future year and, therefore, allow a decrease in the funding requirement in that future year?
Of the four budget review issues, program executability/budget execution is the primary concern
Adv Questions/
Budget Hearings
USD(C)/
OMB
BES
MBI* PB
Services / PEO / PM
Answer / Reclama
Updates
FYDP
Updates
FYDP
BES – Budget Estimate Submission; CAPE – Cost Assessment & Prgm Evaluation
COCOM – Combatant Commander; CPA – Chairman’s Pgm Assessment; CPM – Capability Portfolio Manager
DAWG – Deputy’s Advisory Working Group; FEAs- Front End Assessments; FYDP – Future Years Defense Program
MBI – Major Budget Issues; OMB – Office of Management and Budget; PB – President’s Budget
POM – Program Objectives Memo
RMD – Resource Management Decision; SLRG – Senior Leader Review Group

18. FY 12–16 Program/Budget Schedule
2 April 10 Fiscal Guidance Issued
30 April 10 Defense Planning and Programming Guidance (DPPG) Issued
30 July 10 Component POM/BES Submissions Due
2-13 Aug 10 Component POM Briefs to 3-Star/DAWG
30 Aug 10 Issue Nominations Due
3 Sep 10 Budget Justification Material Due to OSD/OMB
22 Nov 10 Program/Budget Review Complete
7 Feb 11 President’s Budget Submitted to Congress

19. Capability Portfolio Managers (CPMs)
9 Portfolios are Based on Existing Joint Capability Area (JCA) Structure
Civilian/Military Co-Leads Designated by DEPSECDEF
Have No Independent Decision Making Authority
Afforded Access to JROC, DAB & Other Established Component Forums
Shall Establish or Identify Existing Portfolio-Level Governance for Each Portfolio
Roles and responsibilities of the CPMs , based on DepSecDef memos and draft 7045.aa as of Aug 08
CPMS are primarily advisory to the DAWG, but note that they do not have decision making authority.

20. Capability Portfolio Managers (CPMs) Leadership
and
Tier 1 JCA
CPM
Civilian
Lead
Military
Senior Warfighting Forum (SWarF)
Lead *
Joint Staff
OPR *
Functional
Capability
Boards *
Command and Control
ASD (NII)
JFCOM
J-3
Battlespace Awareness
USD (I)
STRATCOM
J-2
Net Centric
J-6
Logistics
USD (AT&L)
TRANSCOM
J-4
Building Partnerships
USD (P)
Director, J-5
N/A
J-5
Protection
Director, J-8
J-8
Force Support
USD (P&R)
Force Application
Joint Requirements Oversight Council (JROC)
SOCOM
Corporate Management & Support
DCMO
Director, Joint Staff
* As designated by the Chairman of the Joint Chiefs of Staff (CJCS)

21. Deputy’s Advisory Working Group
Deputy Secretary of Defense (Chair)
Vice Chairman Joint Chiefs of Staff (Vice Chair)
Under Secretary of Defense (AT&L)
Under Secretary of Defense (Policy) and Principal Deputy
Under Secretary of Defense (Comptroller) /Chief Financial Officer or Principal Deputy
Under Secretary of Defense (P&R) or Principal Deputy
Under Secretary of Defense (Intelligence) or Principal Deputy
Secretary or Under Secretary of the Army
Secretary or Under Secretary of the Navy
Secretary or Under Secretary of the Air Force
Chief or Vice Chief of Staff of the Army
Chief or Vice Chief of Naval Operations
Chief or Vice Chief of Staff of the Air Force
Commandant or Assistant Commandant of the Marine Corps
Commander or Deputy Commander, SOCOM
Deputy Chief Management Officer
ASD (Legislative Affairs)
ASD (Networks & Information Integration/Chief Information Officer
ASD for Public Affairs
General Counsel
Director of Administration and Management
Director or Principal Deputy Director, CAPE
Director, Joint Staff
Chief, National Guard Bureau or Deputy
Director, SP&P-J5
Director, FS,R&A-J8
This is the membership of the DAWG, chaired by DepSecDef. It started out as the ”Group of 12” for the QDR reviews done in 2005.

22. Senior Leader Review Group
Secretary of Defense
Deputy Secretary of Defense
Secretary or Under Secretary of the Army
Secretary or Under Secretary of the Navy
Secretary or Under Secretary of Air Force
Chairman Joint Chiefs of Staff
Vice Chairman Joint Chiefs of Staff
Under Secretary of Defense (AT&L)*
Under Secretary of Defense (Policy)*
Under Secretary of Defense (Comptroller)
/Chief Financial Officer*
Under Secretary of Defense (Intelligence)*
Under Secretary of Defense (P&R)*
Commandant or Assistant Commandant
of the Marine Corps
Director of Administration and Management
Chief or Vice Chief of Staff of the Army
Chief or Vice Chief of Naval Operations
Chief of Staff or Vice Chief of the Air
Force
General Counsel
ASD (Legislative Affairs)
ASD (Networks & Information
Integration/Chief Information Officer
ASD for Public Affairs
Director, Cost Assessment and Program
Evaluation
Director, Joint Staff
Deputy Chief Management Officer
Chief, National Guard Bureau
This is the membership of the Senior Leader Review Group, chaired by SecDef.
* Or Principal Deputy

23. Resource Allocation Process
CY10
CY11
CY12 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
FY10
Execution
2nd Yr
3rd Yr
FY 10 and prior
FY11
Enactment
Execution
2nd Yr
3rd Yr
FY 11
FY 11 and prior PB
FY12
Planning
Program/Budgeting
Enactment
Execution
2nd
FY 12-16
DPPG
FY POM
FY 12 BES
FY 12
FY 12 and prior PB
FY13
Planning
Program/Budgeting
Enactment
Exec
FY DPPG
FY POM
FY 13 BES
FY 13
FY13 & prior PB
FY14
Planning
Program/Budgeting
FY DPPG
FY POM
FY 14 BES
PB – President’s Budget POM – Program Objectives Memorandum
BES – Budget Estimate Submission DPPG – Defense Planning & Programming Guidance

24. Backups

25. Major Force Program 6 - RDT&E
CAT# 01 02 03 04 05 06
#FYDP
(CAPS)
ACTIVITY
Basic Research*/
RESEARCH#
Appl Research/
EXPLOR DEVEL
Adv Tech Devel/
ADV DEVEL
Adv Comp Dev
& Prototypes/
DEM / VAL
Sys Dev & Demo/
ENGR DEVEL
RDTE Mgmt Spt/
MGMT & SPT
Operational
Systems Devel
BA*
BA-1
BA-2
BA-3
BA-4
BA-5
BA-6
BA-7
*FMR
(Title
Case)
PURPOSE
EXPAND KNOWLEDGE/
STUDIES / EXPERIMENTS
DEVELOP & EVALUATE
TECHNICAL FEASIBILITY
PROOF OF CONCEPT/
MODELS
SPECIFIC WEAPON
SYSTEM
ENGR & MFG DEVEL/
INTEGRATION/DEMO
TEST RANGES /
CIVILIAN RANGES
IMPROVE PERFORMANCE
OF PRODUCTION
SYSTEM (R&M)
WHO
UNIV /
LABS
UNIV / LABS /
CONTRACTOR
LABS / FIELD /
LABS /
CONTRACTORS /
FIELD ACTIVITY
TEST RANGES
CONTRACTOR/
FUND MANAGED
RDT & E COMMANDS /
SERVICES
PMO
HEADQUARTERS
PMO (FUNDING IS NOT
ALWAYS RDT&E, THE
MFP IS NOT 6, R & D)
Note: FMR BA titles consistent with July 2008 FMR update

26. DoD Supplemental Appropriations

27. Most Probable Cost (MPC)
AKA Most Likely Cost
50% chance of overrunning or underrunning on a normal curve
The Fin Mgt Reg (DoD R) says you should budget to MPC
DAPA Report (2006) recommended 80% confidence level (CL)
Air Force SAE (Mr. Van Buren) memo dated 17 Mar 10 says NLT mean (typically 55-65% CL) or expected value of cost estimate
OSD CAIG using 50% CL
WSARA 2009 Section 101
DCAPE must issue guidance on confidence levels for cost estimates for MDAP and MAIS programs
MDAP and MAIS programs must disclose confidence level
If less than 80%, must explain

28. Below Threshold Reprogramming
Level of Control
Appropriation
Max Into
Max Out
Research,
Development,
Test & Evaluation
(RDT&E)
Lesser of
$10 million
Or 20%
Lesser of
$10 million
Or 20%
Program Element
Procurement
(PROC)
Lesser of
$20 million
Or 20%
Lesser of
$20 million
Or 20%
Line Item
Operations &
Maintenance
(O&M)
$15 million
No Limit,
Unless
specified
Budget
Activity
Military
Personnel
(MILPERS)
$10 million
No Congressional
Restrictions
Budget
Activity
Military
Construction
(MILCON
Lesser of
$2 million
Or 25%
No Congressional
Restrictions
Project

29. Multiyear Procurement (MYP)
Exception to Full Funding Policy
A Single Contract for a Specific Quantity of Usable End Items to be Delivered Over a Period of Time Greater Than One Year But Not More Than Five Years
After initial MYP Approval by Congress, the Service Requests – and Congress Appropriates – Required Budget on a “Year by Year” Basis to Obligate Against the Contract
Source: DoD R, Vol 2A, Chap 1, Section

30. Defense Appropriations “Colors of Money”
Military Personnel (MILPERS)
Active & Reserve Forces
Operation & Maintenance (O&M)
(civilian Salaries, supplies,
spares, fuels, travel, etc…)
Environmental Restoration
Former Soviet Union Threat
Reduction
Overseas Humanitarian,
Disaster, & Civic Aid
Procurement
Aircraft
Missiles
Weapons
Weapons & Tracked Combat
Vehicles
Ammunition
Other Procurement
Shipbuilding & Conversion
Marine Corps
Defense wide procurement
National Guard & Reserves
Research, Development, Test &
Evaluation (RDT&E)
Basic Research
Applied Research
Advanced Technology Development
Advanced Component Development
& Prototypes
System Development & Demonstration
RDT&E Management Support
Operational Systems Development
Military Construction (MILCON)
Facilities
Family Housing
Base Realignment & Closure (BRAC)
Other
Defense Health Program
Chemical Agents & Munitions
Destruction
Drug Interdiction & Counter-Drug
Activities
Joint Improvised Explosive Device
Defeat Fund
Rapid Acquisition Fund
Office of the Inspector General
RDT&E
PROC
MILPERS
O&M
MILCON
Teaching Point:
In the unlikely case the term “colors of money” is not familiar. This also shows a break out of the major appropriations.
The different RDT&E budget categories are also referred to as different colors of money by some.