S. 1376 would authorize appropriations totaling an estimated $604.6 billion for fiscal year 2016 for the military functions of the Department of Defense (DoD), for certain activities of the Department of Energy (DOE), and for other purposes. In addition, S. 1376 would prescribe personnel strengths for each active-duty and selected-reserve component of the U.S. armed forces.
If appropriated, $515.5 billion of the authorized amounts would count against the defense cap for 2016 set in the Budget Control Act of 2011 (BCA), as amended. Another $0.2 billion would count against the nondefense cap. An additional $88.9 billion would be authorized for overseas contingency operations (OCO) that, if appropriated, would not count against the caps; of that amount, $49.9 billion would be for war-related activities, while the remaining $39.0 billion would be used for “base budget” activities that in recent years have counted against the defense caps. CBO estimates that appropriation of the authorized amounts would result in outlays of $589.2 billion over the 2016-2020 period.
The bill also contains provisions that would affect the costs of defense programs funded through discretionary appropriations in 2017 and future years. Those provisions would affect force structure, DoD compensation and health care benefits, the uniformed services retirement system, and other programs and activities. CBO has analyzed the costs of a select number of those provisions and estimates that they would, on a net basis, lower the amount of appropriations needed to implement defense programs relative to current law by about $17.8 billion over the 2017-2020 period. The effects of those reductions are not included in the total amount of outlays mentioned above because funding for those activities would be covered by specific authorizations in future years.
In addition, S. 1376 contains provisions that would affect direct spending and revenues. CBO estimates that provisions affecting direct spending would, on net, decrease outlays by $2.2 billion over the 2016-2020 period, and by $4.9 billion over the 2016-2025 period. CBO and the staff of the Joint Committee on Taxation (JCT) estimate that enacting the bill would reduce revenues by $0.2 billion over the 2018-2020 period, and by $1.1 billion over the 2018-2025 period. In total, enactment of the bill would decrease the deficit by an estimated $2.0 billion over the 2016-2020 period, and by $3.8 billion over the 2016-2025 period.