Military construction, broader industry prepare to push agenda on 2008 budget

The ink has yet to dry on the Pentagon’s 2008 budget request, but some members of the defense industry already are preparing to push for their top issues and lobbying agendas in the coming fiscal year, while addressing matters unresolved last year.

The ink has yet to dry on the Pentagon’s 2008 budget request, but some members of the defense industry already are preparing to push for their top issues and lobbying agendas in the coming fiscal year, while addressing matters unresolved last year.

Before considering 2008 priorities, a sizable chunk of the industry — military construction — may be unable to start new projects or continue existing ones at military bases because money has not been appropriated for 2007.

The House and the Senate both passed their respective bills funding military construction, but the two chambers did not conference the bills. The new Democratic appropriations chairmen, Sen. Robert Byrd (W.Va.) and Rep. David Obey (Wis.), resorted to a yearlong joint resolution that technically would keep military construction funds at 2006 levels. Lawmakers, however, have leeway to bump up funding where necessary.

The two Democrats are planning to strip the bills funded under the joint resolution of all earmarks, aggravating businesses that rely on such funds to extend district projects.

The military services also are growing concerned that funding required to complete the 2005 Base Realignment and Closure (BRAC) process by 2011 will fall short, and are discussing the issue with lawmakers, according to a source familiar with the issue. BRAC alone provides a boon for new construction.

The Office of the Secretary of Defense did not respond by press time. 

Concerns have emerged not only about construction funding, but over chemical-weapons destruction programs, prompting several lawmakers to plead with appropriators and Pentagon officials.

As the 2008 budget process unfolds, several issues that have dominated the policy debate in recent years likely will resurface.

The Aerospace Industries Association (AIA), for example, is pushing for substantial research-and-development accounts as well as strong funding for new technology programs, such as the Air Force’s Joint Strike Fighter, AIA president John Douglass said.

“In a broader sense we will be watching how Congress looks at acquisition reform,” Douglass said. The association will insist on more multi-year contracts for larger, longer-term defense systems, he added.

This year, AIA is starting to tackle reform of the export controls system, which is prohibitive for both U.S. companies and the Pentagon as it tries to attract innovative businesses. AIA is taking a gradual approach in suggesting reform.

Additionally, it plans to work with the administration on changing export licensing within the current framework. According to Douglass, it will be important for Congress to allow the administration to work within existing law.

The association will also be working on new export control laws, which it anticipates having ready for the 2008 election year. The changes likely will prompt an intense lobbying campaign for fiscal year 2009, because Congress has to authorize any changes to the existing laws.

Some issues may draw less intense response than in previous years. For example, a former chairman of the House Armed Services Committee, Rep. Duncan Hunter (R-Calif.), introduced strict “Buy American” provisions in defense authorization bills — drawing the dismay of much of the defense industry and sparking debate with Senate counterparts who did not support protectionist measures.

With Rep. Ike Skelton (D-Mo.) at the helm of the armed services panel, several industry sources said they expect the “Buy American” issue to decrease in importance.

While defense lobbyists prognosticate on funding and policy as Congress debates the FY 2008 budget, they anxiously await the changes prompted by the Democrats’ ethics and lobbying reform.

“Democrats are going to throw their markers down in the House,” one lobbyist said. “The type of permissible activities and the kind of reporting you have to do will set the stage for the interaction” with staff members and lawmakers.