Can the Air Force Ditch the Pass-Through Budget?

A National Reconnaissance Office payload onboard a rocket

National Reconnaissance Office photo

The Air Force is still trying to free itself of the so-called “pass-through” budget that critics say distorts perceptions of how much money the service is receiving each year. Now, it appears the secretary of defense might be sympathetic to their arguments.

For fiscal year 2021, the Department of the Air Force received $205.5 billion in total funding. Of that, $37.3 billion — or 18 percent — is pass-through, or “non-blue,” funding that actually goes to other agencies; hence the term “pass-through.”

For 2022, the Biden administration requested $212.8 billion for the Department of the Air Force — which the Space Force falls under — including $39 billion for non-blue programs.

Much of the non-blue money is believed to go toward secretive spy agency capabilities such as space systems used by the National Reconnaissance Office. The Air Force and its supporters are hoping that in the future it will be shifted to other accounts.

“Would I like to see the pass-through … funding somewhere else besides on the Air Force topline? Yes,” said Lt. Gen. David Nahom, deputy chief of staff for plans and programs. “When people see the Air Force budget … their perception is we’re a little healthier than we actually are.

“As an Air Force, we’re going to continue to work in [the Office of the Secretary of Defense] with the other agencies around that are part of the pass-through, as well as with Congress and certainly the appropriators to see if we can display our funds differently in the future,” he said during a recent event hosted by the Mitchell Institute for Aerospace Studies.

Some lawmakers are also banging the drum on the issue.

“Can we do something about a more transparent budgeting system that does not give this view that the Air Force is getting a whole bunch of money that they really do not control?” Sen. Kevin Cramer, R-N.D., asked during a Senate Armed Services Committee hearing in June.

In a House Armed Services Committee hearing that same month, Rep. Don Bacon, R-Neb., said: “It’s important that our defense budgets are accurate and transparent. But that’s not really the case for the Air Force budget. … When you factor [the pass-through] in, the Air Force budget is really only $173 billion. And the other services have about a 1 percent pass-through, by the way, versus 18 percent for the Air Force. I just think it’s misleading.”

Secretary of Defense Lloyd Austin III suggested changes could be afoot.

“I would absolutely agree with you that, while we can’t be fully transparent on some of these issues, we need to make sure that the Air Force budget is represented in the appropriate way,” he told lawmakers.

Former Acting Air Force Secretary John Roth said the Defense Department is looking for ways to address the issue without unintentionally disclosing sensitive information.

“There are classified reasons why that [pass-through] exists, and so we need to make sure that we do not uncover things that ought not be uncovered,” he told lawmakers. Roth has been succeeded by Frank Kendall, who became secretary of the service in July.

Retired Air Force Lt. Gen. David Deptula, dean of the Mitchell Institute, said the system needs to change because it is undermining modernization efforts by creating the false impression that the service is getting funds commensurate with the Army and Navy.

How can the issue be addressed?

“Quite frankly, it is a very simple solution, and that is taking this $39 billion [in non-blue funding] and putting it over into the DoD agency account,” he suggested during a recent appearance on the Government Matters TV program. “That will appropriately represent where these monies are going without getting into the specifics of the details of exactly what they are for.

“It does not require an act of Congress,” he added. “It simply requires the leadership of the Department of Defense to allocate it” that way.

Topics: Air Force News, Budget, Space