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Updated January 20, 2023
Defense Primer: Procurement
Background
necessary to acquire a useable end-item is approved by
While procurement implies a process of obtaining goods or
Congress in a single fiscal year, even though related work
services, the word also refers to a specific title and
may span many years.
associated accounts within the annual National Defense
Authorization Act (NDAA) and Department of Defense
Table 1. Funding for DOD Procurement Accounts in
Appropriations Act.
the Department of Defense Appropriations Act, 2023
Appropriations for Procurement
$
The Department of Defense (DOD) procurement
Account (Acronym)
(billions)
appropriations title provides funds for non-construction-
Aircraft Procurement, Army (APA)
$3.8
related investment costs—the costs to acquire capital assets,
such as an F-35 Joint Strike Fighter aircraft or a Virginia-
Missile Procurement, Army (MIPA)
$3.8
class submarine. Investment costs are distinguished from
Procurement of Weapons and Tracked Combat
$4.5
expenses—the costs of resources consumed in operating the
Vehicles, Army (WTCV)
department, such as food and fuel. DOD uses procurement
appropriations to obtain various categories of materiel,
Procurement of Ammunition, Army (PAA)
$2.8
including:
Other Procurement, Army (OPA)
$8.7
new military hardware (e.g., aircraft, ships,
Aircraft Procurement, Navy (APN)
$19.0
armored vehicles, radios, and satellites);
Weapons Procurement, Navy (WPN)
$4.8
upgrades to existing equipment, including service
life extension or remanufacturing programs;
Procurement of Ammunition, Navy and Marine
$0.9
Corps (PANMC)
weapons and ammunition (e.g., air-to-air missiles
and rifle rounds); and
Shipbuilding and Conversion, Navy (SCN)
$32.0
spares and repair parts.
Other Procurement, Navy (OPN)
$12.1
Procurement, Marine Corps (PMC)
$3.7
Procurement funding provided to the department in a given
fiscal year can usually be obligated over a period of three
Aircraft Procurement, Air Force (APAF)
$22.2
years. The most prominent exception is Navy Shipbuilding
Missile Procurement, Air Force (MPAF)
$3.0
and Conversion funding, which is available for five years.
The Department of Defense Appropriations Act, 2023
Procurement of Ammunition, Air Force (PAAF)
$0.9
(Division C of H.R. 2617) provided $162.2 billion for
Other Procurement, Air Force (OPAF)
$28.0
procurement accounts (see Table 1).
Procurement, Space Force (PSF)
$4.5
Procurement, Defense-Wide (PDW)
$6.1
NDAA and Defense Appropriations
Defense Production Act Purchases
$0.4
CRS In Focus IF10516, Defense Primer: Navigating the NDAA
National Guard and Reserve Equipment
$1.0
CRS In Focus IF10515, Defense Primer: The NDAA Process
CRS In Focus IF10514, Defense Primer: Defense Appropriations
TOTAL
$162.2
Process
Source: CRS analysis of Department of Defense Appropriations Act,
2023 (Division C of H.R. 2617) and accompanying explanatory
How is DOD Procurement Funded?
statement.
In general, Congress appropriates money for defense
Note: Totals do not include emergency funding provided in the
procurement under a policy of full funding, which requires
Additional Ukraine Supplemental Appropriations Act, 2023 (Division
funding the entire procurement cost of end-items (e.g.,
M) or Disaster Relief Supplemental Appropriations Act, 2023
AIM-9 Sidewinder missiles or KC-46A refueling tankers)
(Division N) of the legislation.
in one fiscal year. In other words, the total funding
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Defense Primer: Procurement
Exceptions to Full Funding
smaller goods (e.g., gauze or light bulbs) because such
purchases are considered to be expenses rather than
Incremental Funding. In rare cases, programs have
investments and are funded in other parts of DOD’s budget.
been procured using incremental funding, a funding
policy typically associated with research and
Goods and services from the private sector are purchased
development activities. Under incremental funding, a
through contracts and accounted for as contract obligations.
system’s cost is phased over two or more fiscal years.
These individual activities—most of which are too granular
Incremental funding has principally been used to
to be captured in appropriations data—are tracked at the
procure certain ships and submarines (e.g., Virginia-
level of obligations. Obligation is the term used when
and Columbia-class submarines) but is typically
agencies enter into contracts, employ personnel, or
avoided as a funding mechanism for procurement.
otherwise commit to spending money.
Multiyear Procurement. Under 10 U.S.C. §3501,
Relevant Statutes
Congress sometimes authorizes multiyear procurement
(MYP) for programs. MYP can achieve savings by
Title 10, U.S. Code, Part IV—Service, Supply, and
committing to buy items from a contractor over multiple
Procurement.
years for a reduced price per unit. Qualifying for MYP
requires a program to prove that it will achieve
substantial savings throughout its annual buys, receive
CRS Products
sufficient and stable funding, and procure items unlikely
to substantially change over the multiyear period.
For information on the Defense Acquisition System, see CRS
Examples include ships (e.g., Virginia-class submarines
Report RL34026, Defense Acquisitions: How DOD Acquires
and DDG-51 Arleigh Burke-class destroyers); aircraft
Weapon Systems and Recent Efforts to Reform the Process
(e.g., UH-60 Black Hawk helicopters, MV-22 Osprey
For information on the ful funding policy in DOD
tilt-rotor aircraft, and C-130J Super Hercules cargo
procurement, see CRS Report RL31404, Defense Procurement:
planes); and munitions (e.g., M142 High Mobility
Full Funding Policy—Background, Issues, and Options for Congress
Artillery Rocket Systems, or HIMARS, and MGM–140
For information on special cases of procurement, see CRS
Army Tactical Missile Systems (ATACMS)).
Report R41909, Multiyear Procurement (MYP) and Block Buy
Contracting in Defense Acquisition: Background and Issues for
Advance Procurement. Programs receive advance
Congress
procurement funds for components of a unit that need to
be purchased long before the unit itself is purchased.
For information on RDT&E funding see CRS In Focus IF10553,
Advance procurement requires a separate initial
Defense Primer: RDT&E.
contract, and its authority is provided in an
For general information on defense procurement and contract
appropriations act. For programs using MYP, advance
acquisition, see CRS In Focus IF10600, Defense Primer:
procurement may also be used to achieve economic
Department of Defense Contractors and CRS Report R44010,
order quantity, which is defined as buying enough of an
Defense Acquisitions: How and Where DOD Spends Its Contracting
item to minimize the total cost.
Dollars
When Does a Program Enter
Procurement?
Programs that produce a major capability (e.g., an aircraft
Other Resources
carrier or armored fighting vehicle) usually enter
DOD Comptrol er, Defense Budget Materials,
procurement after they receive Milestone C approval in the
http://comptrol er.defense.gov/Budget-Materials
Defense Acquisition System. Prior to procurement,
programs are considered to be in development and
DOD 7000.14-R, “Financial Management Regulation,” Budget
generally funded through Research, Development, Test and
Formulation and Presentation: Procurement Appropriations, vol. 2B,
Evaluation (RDT&E) appropriations. Some programs will
ch. 4, November 2017, at https://comptrol er.defense.gov/
receive procurement funds before a formal Milestone C
Portals/45/documents/fmr/Volume_02b.pdf
approval.
How Else Does DOD Purchase Goods
and Services? How Does Procurement
Heidi M. Peters, Analyst in U.S. Defense Acquisition
Relate to Defense Contracting?
Policy
Alexandra G. Neenan, Analyst in U.S. Defense
DOD is authorized and appropriated procurement funding
Infrastructure Policy
for non-construction investments. DOD typically uses
funding other than procurement to purchase services (e.g.,
IF10599
research, architectural design, or cleaning services) and
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Defense Primer: Procurement
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
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