Are the trends seen in Army modernization today similar in nature to trends of the previous drawdowns, or is this time different? Historically, the decline in army modernization follows the same general pattern: After a period of growth, Army modernization total obligation authority (TOA) peaks between 27 percent and 31 percent of overall Army TOA. After hitting that peak, the Army modernization budget rapidly declines for the next few years, before leveling off. The Army modernization budget then generally holds relatively steady for a few years at that new budget level, before once again increasing.
After five years of drawdown, two questions have loomed large: “When will defense contracting hit bottom?” and “Are future capabilities being preserved despite the current drawdown?”
Since 2008, the Department of Defense’s (DoD) contracting portfolio has faced significant resource pressures, as a result of the ongoing budget drawdown, sequestration, and its aftermath. With FY2015 contract data now available through the Federal Procurement Data System (FPDS), CSIS has begun to examine whether the trends observed in the first two years of the post-sequestration defense contracting environment would continue to hold. For the Army, at least, the data shows a notable slowing of the decline in contract obligations in 2015.