A Closer Look at the CBO’s Ground-Based Midcourse Defense (GMD) System Cost Figures (July 23, 2014)

The Congressional Budget Office has just released a very short report on the Missile Defense Agency’s future spending plans for its Ground-Based Midcourse (GMD) national missile defense system.[1] This Report, titled “Historical and Planned Future Budgets for the Missile Defense Agency’s Ground-Based Midcourse Defense Program” was released as a letter to Senator Jeff Sessions and is based on MDA’s budget request projections out through fiscal year 2019. It compares these GMD budget projections with actual GMD spending going back to FY 2008.

The main conclusions people seem likely to draw from the Report are that spending on the GMD system is expected to decline by more than a factor of two from its 2008 level and that by FY 2019 it will fall below $1 billion.[2] Specifically, the Report shows that GMD Research, Development, Test, and Evaluation (RDT&E) and GMD Procurement spending will total $789 million in FY 2019. Another $169 million for Operations and Maintenance (O&M) will bring the total FY 2019 GMD spending to $958 million. For comparison, the Report shows that in FY 2008 the total GMD spending was $2,093 million. (None of the $ figures in the Report have been adjusted for inflation.)

Several points should be made:

First the GMD budget falling below $1 billion is not a particularly significant benchmark (nor does the CBO Report say it is). According to the Report’s figures, actual FY 2013 spending on the GMD system was only $923 million.

Second, the actual planned spending on the GMD system will be significantly higher than shown in the CBO Report.[3] To illustrate this, I will focus on the planned GMD spending for FY 2019, the last year considered by the Report. As noted above, the Report says the currently planned GMD spending for FY 2019 is $958 million. However, if we look in more detail at the MDA’s planned budget we see that there are some significant omissions in what the CBO includes. For example, neither the Sea-Based X-Band (SBX) Radar ($63.0 million in FY 2019) nor the Long Range Discrimination Radar (LRDR) ($189 million in FY 2019) is included.[4] The FY 2019 GMD Test line item (Project MT08) included in the CBO cost figure is only $61.6 million.[5] Since each GMD test now costs $200 million or more, this suggests that roughly another $100-150 million for GMD testing should be included in the CBO’s FY 2019 GMD cost estimate figure.[6] A number of other projects that are intended to at least partially to contribute to the GMD system, such as the Common Kill Vehicle Technology Project ($54.3 million in FY 2019) are also not accounted for in the CBO figures.  Taken together, these omissions suggest MDA’s total planned spending for FY 2019 is much closer to $1.5 billion than the $958 million in the CBO Report.

Third, the numbers in the CBO Report are based on MDA plans that do not include a third interceptor site in the eastern United States. If this third site is not built, then by FY 2019, if everything proceeds according to plan, the GMD system would be nearly complete. All 44 planned GBI interceptors would be deployed, the Clear and Cape Cod radars would have been upgraded and incorporated into the system, and the LRDR would be nearly complete (with about $910 million spent on it through FY 2019). While there would certainly be significant ongoing costs, such as for operations, for testing (including buying new interceptors for this purpose) and for technology development and upgrades, one would certainly expect the GMD annual funding to be significantly less that it was FY 2008, when the system was in the midst of being built.

On the other hand, if a decision was made to proceed with a third interceptor site, the future GMD spending situation could look quite different.  The environmental impact statement for the proposed third site location will assess the deployment of between twenty and sixty interceptors at potential sites. If each interceptor cost the same as a current GBI interceptor, about $75 million, then the total cost just for the additional interceptors would be about $1.5-4.5 billion, which would require a large increase in GMD funding over current plans.

[1] Congressional Budget Office, “Historical and Planned Future Budgets for the Missile Defense Agency’s Ground-Based Midcourse Defense Program, letter to Senator Jeff Sessions, July 12, 2014. Available at: http://www.cbo.gov/sites/default/files/cbofiles/attachments/45546-GMD_Program.pdf.

[2] See for example, Jason Sherman, “CBO Traces Decline in GMD Spending From FY-08 To FY-19,” Inside Defense SITREP, July 23, 2014.

[3] The CBO Report (footnote a) states that the Report only includes funding in the Midcourse Defense program element and does not include “funding for other support activities that are contained in other program elements.”

[4] MDA’s planned budget can be found on pages 2a-xxi to 2a-xxiv of http://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2015/budget_justification/pdfs/03_RDT_and_E/2_RDTE_MasterJustificationBook_Missile_Defense_Agency_PB_2015_Vol_2.pdf.

[5] This is not just an FY 2019 budget anomaly, as the FY 2015-2019 five year average for the GMD Test line item is $67.4 million.

[6] Most of this other GMD testing funding is likely in the Ballistic Missile Defense Test ($413 million in FY 2019) and the Ballistic Missile Defense Targets ($429.8 in FY 2019) program elements, which are not included in the CBO GMD cost figures.

Leave a comment


  1. Allen Thomson

     /  July 23, 2014

    I may not be remembering this correctly, but wasn’t it planned to hand SBX over to the Navy around now? So perhaps its O&M budget will show up there? (Not that the Navy is likely to be thrilled about the prospect.)

  2. Allen,
    I vaguely remember something like such a transfer being discussed long ago, but clearly it is not going to happen. The budget for the SBX is a line item in the MDA budget, its just that the CBO did not include it in their GMD cost. MDA officials have said that when the new LRDR comes on line in 2020 it will give them greater geographic flexibility for operating the SBX (that is, moving it to the east coast). So MDA clearly plans to have the SBX around for quite a while longer.


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