Department of Defense Appropriations Act, 2026
- Sponsor
- Sen. McConnell, Mitch [R-KY]
- Committees
- Appropriations Committee
- Last action
- Jul 31, 2025
Bottom line
The bill appropriates over $850 billion for the Department of Defense and related agencies for fiscal year 2026, covering all aspects of military operations, personnel, and modernization, while also including specific policy directives and spending restrictions.
What it actually does
This bill, the Department of Defense Appropriations Act, 2026, provides funding for the U.S. Department of Defense and related agencies for the fiscal year ending September 30, 2026. It allocates substantial sums across military personnel, operation and maintenance, procurement, research and development, and other defense programs. The bill also includes numerous general provisions that govern how these funds can be spent, impose specific policy directives, and establish various limitations and reporting requirements.
Proponents argue
Proponents argue that this bill is essential for maintaining a strong national defense, ensuring military readiness, and protecting U.S. national security interests globally. They would highlight the investments in modernizing equipment, supporting service members and their families, and funding critical research and development to maintain a technological edge against adversaries. The bill's targeted security assistance programs are also seen as vital for supporting allies and countering threats abroad.
Opponents contend
Opponents might contend that the bill's overall spending levels are excessive and contribute to the national debt, potentially diverting resources from other pressing domestic needs. Concerns could be raised about specific procurement programs, the efficiency of defense spending, or the inclusion of policy riders that may not have undergone sufficient debate as standalone legislation. Some may also scrutinize the scope and recipients of foreign security assistance.
The bill is 26 pages long and contains a high density of financial figures and technical legislative language. While not exceptionally long for an appropriations bill, a thorough understanding requires significant time, which may be limited given the typical pace of legislative consideration for such measures.
Title I
Military Personnel Appropriations
This title appropriates funds for the pay, allowances, clothing, subsistence, and travel of active duty military personnel across all branches (Army, Navy, Marine Corps, Air Force, Space Force), as well as for Reserve and National Guard personnel. It also covers payments to the Department of Defense Military Retirement Fund. The total allocated for military personnel is approximately $160.4 billion.
Supporters argue
Supporters argue that robust funding for military personnel is critical for recruiting and retaining a high-quality, professional fighting force, ensuring their well-being, and maintaining morale. It directly supports the individuals who serve the nation.
Critics contend
While direct opposition to military personnel funding is rare, critics might argue for greater scrutiny of personnel costs, including benefits and retirement contributions, to ensure efficiency and sustainability.
Tradeoffs
The primary tension is balancing competitive compensation and benefits for service members with overall budget constraints and other defense priorities. Decisions on personnel levels and compensation have long-term fiscal implications.
Title II
Operation and Maintenance Appropriations
This title provides funds for the day-to-day operations and maintenance of the Army, Navy, Marine Corps, Air Force, Space Force, and various Defense-Wide activities, including their reserve components and National Guard. It covers expenses such as training, organization, administration, facility and equipment repair, travel, and procurement of services and supplies. Significant allocations include $59.2 billion for Army O&M, $76.4 billion for Navy O&M, and $64.8 billion for Air Force O&M.
Title II, "Counter-ISIS Train and Equip Fund"
Counter-ISIS Train and Equip Fund
This provision appropriates $342,516,000, available until September 30, 2027, for the Secretary of Defense, in coordination with the Secretary of State, to provide assistance to foreign security forces, irregular forces, groups, or individuals participating in activities to counter the Islamic State of Iraq and Syria (ISIS). This assistance includes training, equipment, logistics, stipends, and infrastructure support, with vetting requirements for recipients and reporting to Congress.
Title III, "Shipbuilding and Conversion, Navy"
Naval Shipbuilding and Conversion Programs
This section appropriates $29,310,365,000, available until September 30, 2030, for the construction, acquisition, or conversion of naval vessels. Major programs funded include Columbia Class Submarine ($5.39B + $6.99B AP), Carrier Replacement Program ($1.04B + $612M AP + $1.62B for CVN-81), Virginia Class Submarine ($2.73B + $3.74B AP), and DDG-51 Destroyer ($460M + $1.3B AP). It also includes funds for refueling overhauls, frigates, oilers, and other auxiliary vessels.
Title VI, "Defense Health Program"
Defense Health Program Funding
This provision appropriates $41,436,623,000 for the Defense Health Program. This includes $39,160,590,000 for operation and maintenance (with up to $21,023,765,000 for TRICARE contracts), $354,821,000 for procurement, and $1,921,212,000 for research, development, test and evaluation. Notably, not less than $897,000,000 of RDT&E funds are for congressionally directed medical research programs.
Title VIII, Sec. 8005
General Transfer Authority
This section grants the Secretary of Defense authority to transfer up to $6,000,000,000 of working capital funds or funds appropriated for military functions (excluding military construction) between appropriations or subdivisions. This authority can only be used for higher priority, unforeseen military requirements and cannot be used for items previously denied by Congress. The Secretary must notify Congress of all transfers.
Title VIII, Sec. 8030
Buy American Act Compliance and Enforcement
This section mandates that Department of Defense entities comply with the Buy American Act (Chapter 83 of Title 41, U.S. Code) when expending funds from this Act. It also requires the Secretary of Defense to consider debarring contractors convicted of intentionally mislabeling products as 'Made in America.' Additionally, it expresses the sense of Congress that DoD entities should purchase American-made equipment and products if they are cost-competitive, quality-competitive, and timely available.
Title VIII, Sec. 8045
Rescissions from Prior Appropriations Acts
This section rescinds a total of $2,986,525,000 from various Department of Defense appropriations accounts from fiscal years 2024 and 2025. These rescissions target specific procurement, research, and operation and maintenance accounts, including significant amounts from 'Procurement of Weapons and Tracked Combat Vehicles, Army' ($577.7M) and 'Aircraft Procurement, Air Force' ($259.6M).
Title VIII, Sec. 8069
Israeli Cooperative Programs Funding
This section allocates $500,000,000 from 'Procurement, Defense-Wide' and 'Research, Development, Test and Evaluation, Defense-Wide' for Israeli Cooperative Programs. This includes $60,000,000 for the Iron Dome defense system, $127,000,000 for the Short Range Ballistic Missile Defense (SRBMD) program, $40,000,000 for co-production of SRBMD systems, $100,000,000 for an upper-tier component to the Israeli Missile Defense Architecture (Arrow 3 co-production), and $173,000,000 for the Arrow System Improvement Program.
Title VIII, Sec. 8082
Prohibition on Arbitration Clauses for Sexual Assault/Harassment Claims
This section prohibits federal contractors with contracts exceeding $1,000,000 from requiring employees or independent contractors to resolve claims under Title VII of the Civil Rights Act of 1964 or torts related to sexual assault or harassment through arbitration. It also prevents contractors from enforcing existing arbitration provisions for such claims. Subcontractors are similarly bound, and the Secretary of Defense can waive the prohibition for national security interests.
Title VIII, Sec. 8091 and 8092
Domestic Manufacturing Requirements for Naval Ship Components
Section 8091 imposes domestic manufacturing requirements for specific components of TAO Fleet Oiler (seventh and subsequent ships) and FFG(X) Frigate programs (all new contracts). These components include auxiliary equipment, propulsion equipment, shipboard cranes, and anchor chains. Section 8092 extends similar domestic manufacturing requirements to auxiliary equipment and propulsion shafts for T-ARC(X) Cable Laying and Repair Ship and T-AGOS(X) Oceanographic Surveillance Ship contracts.
Title VIII, Sec. 8099
Ukraine Security Assistance Initiative
This section appropriates $800,000,000, available until September 30, 2027, for the Ukraine Security Assistance Initiative. These funds are for the Secretary of Defense, with State Department concurrence, to provide assistance (including training, equipment, lethal aid, logistics, and intelligence support) to Ukraine's military and national security forces resisting Russian aggression. It also allows for replacement of U.S. inventory items provided to Ukraine and acceptance of foreign contributions.
Title VIII, Sec. 8109
CHIPS for America Defense Fund Allocations
This section directs the Secretary of Defense to allocate funds from the CHIPS for America Defense Fund for fiscal year 2026 within 45 days of enactment, according to tables in the accompanying report. It also restricts future allocations under the CHIPS Act during continuing resolutions and requires proposed allocations for FY2027 to be submitted with the President's budget. Quarterly reports on fund status are mandated.
Title VIII, Sec. 8119
Indo-Pacific Security Assistance Initiative
This section appropriates $1,500,000,000, available until September 30, 2027, for the Indo-Pacific Security Assistance Initiative. These funds are for the Secretary of Defense, with State Department concurrence, to provide assistance, including new procurement of defense articles, services, and military education and training to Taiwan. It also allows for equipment provided to Taiwan to be treated as DoD stocks if returned and requires congressional notification and quarterly reports.
Requires the obligation and expenditure of funds for specific programs, projects, and activities to be carried out in the manner provided by the 'Committee Recommended Adjustments' tables in the accompanying report and classified annex, as if they were part of the Act's text.
Title VIII, Sec. 8006
Why it matters:This is standard legislative practice for appropriations bills, allowing Congress to exert detailed control over spending without cluttering the bill text with thousands of line items. However, it means the full legal force of the bill is not apparent from the text alone.
Case for: Supporters argue this mechanism allows for granular congressional oversight and ensures that specific programmatic priorities and adjustments made by committees are legally binding, reflecting the will of Congress in detail.
Case against: Critics contend that relying on external documents for legally binding spending directives reduces transparency, making it difficult for the public and even many members of Congress to fully understand the specific allocations and policy choices.
Estimated impact: This provision impacts the allocation of billions of dollars across virtually all DoD programs, ensuring adherence to specific congressional directives.
Imposes several restrictions on multiyear procurement contracts, including limits on economic order quantity procurement and unfunded contingent liability, a requirement for full funding of units in the budget request, and prohibitions on certain cancellation provisions or price adjustments based on failure to award follow-on contracts.
Title VIII, Sec. 8010
Why it matters:These are technical controls on procurement practices, often developed in response to past issues with contract management or unfunded liabilities. While important, their technical nature means they are typically placed in general provisions rather than being highlighted.
Case for: Proponents argue these restrictions ensure fiscal responsibility in large-scale procurement, prevent the government from incurring excessive unfunded liabilities, and promote transparency in multiyear contracting, protecting taxpayer interests.
Case against: Critics, particularly from industry, might argue that some restrictions, such as the full funding requirement or limitations on cancellation clauses, can reduce the flexibility and attractiveness of multiyear contracts, potentially leading to higher overall costs or less efficient production runs.
Estimated impact: This provision impacts multi-billion dollar procurement programs across the Department of Defense, influencing how major weapon systems and platforms are acquired.
Prohibits the use of Research, Development, Test and Evaluation (RDT&E) funds to procure end-items for delivery to military forces for operational training, operational use, or inventory requirements, with exceptions for development, prototyping, and test activities. It requires certifications and reports from DoD leadership if end-items budgeted with RDT&E funds exceed test strategy requirements.
Title VIII, Sec. 8055
Why it matters:This provision aims to prevent the misuse of RDT&E funds to bypass procurement appropriations, which have different oversight and funding rules. It's a technical safeguard against 'buying down' production costs in RDT&E accounts.
Case for: Proponents argue this ensures proper accounting and congressional oversight, preventing RDT&E funds from being used for operational procurement, which should be funded through dedicated procurement accounts. It maintains the integrity of the budget structure.
Case against: Critics might argue that in some cases, particularly for rapid prototyping or urgent operational needs, the strict separation of RDT&E and procurement funding can create bureaucratic hurdles and slow down the delivery of critical capabilities to warfighters.
Estimated impact: This provision affects billions of dollars in RDT&E funding, influencing how new technologies and systems transition from development to operational use.
Mandates that the Department of Defense continue to apply fiscal year 2024 negotiated indirect cost rates for Institutions of Higher Education, as specified in 2 CFR 200.414, including deviations. It prohibits the use of funds to develop, modify, or implement changes to these rates.
Title VIII, Sec. 8123
Why it matters:This provision addresses a contentious issue between federal agencies and universities regarding the reimbursement of indirect costs for research. It's a policy directive inserted into an appropriations bill to maintain a specific status quo, likely due to ongoing disagreements or a desire to protect university research funding.
Case for: Proponents (likely universities and research institutions) argue that maintaining stable indirect cost rates is essential for predictable funding and the financial viability of academic research, which is crucial for defense innovation. Changing rates can disrupt research programs.
Case against: Critics (potentially some federal agencies or fiscal conservatives) might argue that current indirect cost rates are too high or lack sufficient transparency, and that prohibiting their modification prevents necessary reforms to ensure efficient use of taxpayer funds for research.
Estimated impact: This provision affects billions of dollars in federal research grants to universities, influencing the financial health of academic research institutions and the cost of defense-related R&D.