When the Defense Department received a $23 billion down payment for the Golden Dome initiative through a reconciliation bill, lawmakers demanded a detailed plan for how the Pentagon plans to spend that money.

Six months later, lawmakers are still waiting for the Pentagon to provide “complete budgetary details and justification of the $23,000,000,000 in mandatory funding.” That includes a comprehensive deployment schedule, cost, schedule and performance metrics and a finalized system architecture. 

As a result, Congressional appropriators were unable to conduct oversight of Golden Dome programs for fiscal 2026.

The department’s $175 billion Golden Dome initiative President Donald Trump first ordered last January aims to build a network of satellites — possibly numbering in the hundreds or even thousands — that would detect, track and intercept incoming missiles. Pentagon officials have described the program as a “top priority for the nation.”

The effort has been shrouded in secrecy, and lawmakers’ demand for more detail on how the Pentagon plans to spend the initial tranche of funding is another sign of Congress’s limited visibility into the program’s early spending plans.

“Due to insufficient budgetary information, the House and Senate Defense Appropriations Subcommittees were unable to effectively assess resources available to specific program elements and to conduct oversight of planned programs and projects for fiscal year 2026 Golden Dome efforts in consideration of the final agreement,” appropriators wrote.

Elaine McCusker, senior fellow at the American Enterprise Institute, said it is not unusual or surprising for lawmakers to seek complete budget information for a complex program like the Golden Dome that pulls in multiple complex ongoing efforts and includes classified components.

“Congress often requests new budget exhibits and supplementary information for evolving, complicated programs with potentially high price tags so they can better understand what is existing and ongoing funding and what is really new or accelerated in the budget request,” McCusker told Federal News Network.

But Greg Williams, director of the Center for Defense Information at the Project on Government Oversight, said Congress’ request for complete budgetary information highlights a broader challenge with how the administration has rolled out major initiatives without providing sufficient detail.

“Golden Dome is an extraordinarily complex and ambitious program, for which we should expect extraordinarily comprehensive information. Instead, the American people and Congress have the opposite. The fiscal 2026 Defense Appropriations Act and its explaining document appear to appropriately reflect that disparity,” Williams told Federal News Network.

The House passed the final 2026 minibus funding package Thursday, which includes money for the Defense Department. If the spending bill becomes law, Defense Secretary Pete Hegseth, along with Gen. Michael Guetlein, the Golden Dome director, will have two months to provide a comprehensive spend plan for the initiative. Lawmakers want to see planned obligations and expenditures by program, descriptions, justification and the corresponding system architecture mission areas for fiscal 2025 through 2027. 

The Pentagon comptroller would also have to submit a separate budget justification volume annually beginning in fiscal 2028.

McCusker said Congress bears some responsibility for the delay — budget uncertainty has complicated the department’s efforts to develop the program.

“The Pentagon is pursuing new ideas in how it partners with industry to rapidly develop, build and deploy the myriad systems that make up Golden Dome while also navigating annual delays and uncertainty in getting its budget,” she said. “Congress has an understandable thirst for information on high profile defense programmatic priorities and may perceive a delay in getting the level of detail it seeks, but failing to pass annual appropriations on time has become so common it is a perpetual factor to mitigate. Congress has to accept responsibility for this and be willing to take some risk in providing funds in advance of all the information it needs.”

President Donald Trump said in May that the Golden Dome’s architecture had been “officially selected,” but details about the initiative remain scarce and the Pentagon has restricted officials from publicly discussing the initiative.

McCusker said that Congress’ request for detailed planning, performance and budget information doesn’t say much about the program itself other than “its level of complexity and maturity and the need to develop and convey the overall strategy and projected timeframe for its execution.”

There is no single “Golden Dome” line item in the 2026 spending bill, though it includes billions for related programs that will most likely support the broader system.

The Pentagon leadership received its first official briefing on the Golden Dome architecture in September, and an implementation plan was expected to be delivered in November.

Williams said producing a detailed plan of this complexity in a short period of time is understandably difficult, but added that crafting a plan that credibly explains how its goals will be achieved is “likely impossible according to many experts.”

“Golden Dome is a program of unprecedented, arguably reckless, complexity and ambition.” Williams said. 

“The lack of information is also a result of Congress’s choice to use reconciliation to increase defense spending: The reconciliation process does not provide for the formal submission of budget request materials from the executive branch and so risks exactly this kind of lack of information. Congress should return to the statutory process for clean Defense authorization and appropriations acts to ensure adequate information,” he added.

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The Defense Logistics Agency — an organization responsible for supplying everything from spare parts to food and fuel — is turning to artificial intelligence and machine learning to fix a long-standing problem of predicting what the military needs on its shelves.

While demand planning accuracy currently hovers around 60%, DLA officials aim to push that baseline figure to 85% with the help of AI and ML tools. Improved forecasting will ensure the services have access to the right items exactly when they need them. 

“We are about 60% accurate on what the services ask us to buy and what we actually have on the shelf.  Part of that, then, is we are either overbuying in some capacity or we are under buying. That doesn’t help the readiness of our systems,” Maj. Gen. David Sanford, DLA director of logistics operations, said during the AFCEA NOVA Army IT Day event on Jan. 15.

Rather than relying mostly on historical purchase data, the models ingest a wide range of data that DLA has not previously used in forecasting. That includes supply consumption and maintenance data, operational data gleaned from wargames and exercises, as well as data that impacts storage locations, such as weather.

The models are tied to each weapon system and DLA evaluates and adjusts the models on a continuing basis as they learn. 

“We are using AI and ML to ingest data that we have just never looked at before. That’s now feeding our planning models. We are building individual models, we are letting them learn, and then those will be our forecasting models as we go forward,” Sanford said.

Some early results already show measurable improvements. Forecasting accuracy for the Army’s Bradley Infantry Fighting Vehicle, for example, has improved by about 12% over the last four months, a senior DLA official told Federal News Network.

The agency has made the most progress working with the Army and the Air Force and is addressing “some final data-interoperability issues” with the Navy. Work with the Marine Corps is also underway. 

“The Army has done a really nice job of ingesting a lot of their sustainment data into a platform called Army 360. We feed into that platform live data now, and then we are able to receive that live data. We are ingesting data now into our demand planning models not just for the Army. We’re on the path for the Navy, and then the Air Force is next. We got a little more work to do with Marines. We’re not as accurate as where we need to be, and so this is our path with each service to drive to that accuracy,” Sanford said.

Demand forecasting, however, varies widely across the services — the DLA official cautioned against directly comparing forecasting performance.

“When we compare services from a demand planning perspective, it’s not an apples-to-apples comparison.  Each service has different products, policies and complexities that influence planning variables and outcomes. Broadly speaking, DLA is in partnership with each service to make improvements to readiness and forecasting,” the DLA official said.

The agency is also using AI and machine learning to improve how it measures true administrative and production lead times. By analyzing years of historical data, the tools can identify how industry has actually performed — rather than how long deliveries were expected to take — and factor that into DLA stock levels.  

“When we put out requests, we need information back to us quickly. And then you got to hold us accountable to get information back to you too quickly. And then on the production lead times, they’re not as accurate as what they are. There’s something that’s advertised, but then there’s the reality of what we’re getting and is not meeting the target that that was initially contracted for,” Sanford said.

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Congressional appropriators are backing the Pentagon’s push to speed up weapons buying, but warn that speed “must be factored alongside cost, performance, lethality and scalability.”

The House released the final 2026 minibus funding package early Tuesday, which includes money for the Departments of Defense, Homeland Security, Labor, Education, Housing and Urban Development, Transportation and Health and Human Services. If passed, the bill would increase defense spending to more than $839 billion — roughly $8.4 billion above the White House’s fiscal 2026 request. House leaders plan to vote on the package later this week. 

Congressional negotiators said they “strongly support” the Defense Department’s acquisition reforms, but pushed back on the Pentagon’s efforts to seek additional authorities or changes to its budget and appropriations framework until it fixes its internal processes. 

“Rapid delivery of ineffective weapon systems at exorbitant cost will not serve the warfighter well,” the appropriators wrote. 

Lawmakers also raised concerns about joint requirements process reform and deep cuts to the department’s acquisition workforce that could jeopardize its ability to carry out Defense Secretary Pete Hegseth’s acquisition reform agenda.

Budget flexibility

Hegseth recently unveiled a plan to overhaul the department’s acquisition system — some of those reform proposals made it into the fiscal 2026 defense policy bill, which became law in December.

At the very end of the document, Hegseth instructed the department to “improve budget flexibility.” 

“Where additional authorities are required, the [undersecretary of defense for acquisition and sustainment], in coordination with the military departments, shall develop a legislative engagement plan to ensure Congress is informed of and aligned with proposed reforms requiring any statutory change,” Hegseth wrote. “All actions will comply with applicable statutes, appropriations law, and procurement integrity requirements.”

That language was likely to become a friction point with Congressional leaders, and now appropriators are saying that reforms laid out in Hegseth’s memo are “internal in nature,” and that the Defense Department needs to “demonstrate progress on these internal procedures and administrative measures” before pursuing additional budget flexibility.

For instance, lawmakers said above-threshold transfer and reprogramming requests are often slowed because “a significant amount of the subcommittees’ time is consumed by waiting for the department to provide requested additional details and justification for these requests.”

“Providing this information alongside the submission of the request would accelerate consideration and create a nimbler process without altering existing authority or reprogramming thresholds,” the appropriators said.

Congressional leaders urged the department’s comptroller and the services’ assistant secretaries to work with the House and Senate Defense Appropriations Subcommittees to improve the amount of detail and justification provided in reprogramming submissions.

Congress gave the department some budget flexibility in 2024 but stopped short of granting broader authorities the department and reform advocates have been seeking that would allow DoD to move money more freely within its accounts without explicit congressional approval.

The Defense Department has also been pushing to change the hardware-centric budgeting model Congress uses to plan and execute the Pentagon’s spending by moving away from the traditional “colors of money” tied to different phases of weapons development. And while DoD has run several pilot projects to test the idea, lawmakers have been hesitant to authorize broader adoption of the approach due to the department’s inability to provide Congress with sufficient data showing the new approach would be more effective than traditional appropriation practices.

“To date, the agreement observes no new or compelling justification or quantitative analysis to support proposals that would alter the current appropriations framework, including with respect to reprogramming thresholds, notification requirements, new start guidelines, or consolidation into a single color of money,” the appropriators said.

“Consideration of legislative changes to the appropriations structure is premature until the Department has demonstrated full and effective use of its existing flexibilities and addressed persistent internal delays,” they added.

Army’s agile funding request rejected

While appropriators approved all 13 budget line-item consolidations requested by the Army in its fiscal 2026 budget, they flatly rejected the Army’s “agile funding” request to raise notification threshold for reprogramming or transfers from $15 million to $50 million for procurement programs and to $25 million for research and development efforts.

“The Department already has sufficient authorities to restructure its internal programming and budgeting processes, and many current challenges with execution can be solved by actions within the Department and do not require statutory change or congressional intervention … Increasing reprogramming thresholds alone is unlikely to improve program execution. Decisions to unilaterally move funding in the year of execution without sufficient oversight introduce uncertainty to both the programs impacted and the industrial base, increasing the risk of development and procurement delays,” the appropriators said.

“The House and Senate Defense Appropriations Subcommittees discourage the secretary of defense and the service secretaries from submitting future requests of this nature,” they added.

Joint requirements reform risks

The Defense Department kicked off the process of dismantling its decades-old Joint Capabilities Integration and Development System (JCIDS) process last year — and Hegseth ordered the Joint Requirements Oversight Council (JROC), which oversees the process, to stop validating service-level requirements to the “maximum extent permitted by law.”

House and Senate appropriators said they support the reform but want more detail on how defense officials plan to mitigate potential risks, such as the military services potentially prioritizing service-specific solutions over joint ones or top-down decision-making stifling bottom-up innovation.

The deputy secretary of defense, vice chairman of the Joint Chiefs of Staff and service secretaries have 60 days to brief appropriators on how they plan to address those risks. 

Workforce is the linchpin of acquisition reform

DoD leaders have long warned that the depth of this administration’s workforce cuts could cripple the department’s ability to execute Hegseth’s acquisition reforms.

Appropriators echoed those concerns, saying they are “concerned that recent reductions to the acquisition workforce, the effects of which have yet to be realized, will negatively affect the Department of Defense’s ability to achieve the initial speed and agility sought by this reform effort.”

Lawmakers directed the defense secretary along with service secretaries to submit an acquisition workforce strategy, including a comprehensive assessment of the personnel needed to execute Hegseth’s and Congress’ proposed acquisition reforms.

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The Army is updating its software directive and scrapping its existing policy on software funding that has routinely hindered software projects across the service. 

Michael Obadal, the service’s undersecretary, said the new software directive will be released “in the coming weeks.” The service plans to revise the document annually to keep pace with the rapidly changing environment. 

Meanwhile, canceling its existing policy governing how the service pays for software will allow the Army to “apply the appropriate type of money to the applicable use case.” 

“For many years, as many of you know, we’ve been trapped by the color of money. We try to buy modern, agile software with rigid funding authorities. Predictably, it doesn’t work,” Obadal said during the AFCEA NOVA Army IT Day event on Thursday.

This shift will give the Army greater flexibility in how it uses its operations and maintenance, procurement and research, development, testing and evaluation funds for software.

While flexible use of different colors of money will offer the service some relief, it is still not “the most effective method” for funding software. Obadal said the Army ultimately plans to pursue Budget Activity 8 (BA-8), which will allow program managers to move away from the hardware-centric budgeting model and instead draw funding from an appropriations category specific to software.

“We’re going to pursue Budget Activity 08 for our software, which would realign funding from various appropriations to new software and digital technology in its own budget activity,” Obadal said.

The Defense Department has long struggled with software acquisition for a number of reasons, but the rules that govern how the department pays for software have possibly been one of its major obstacles. The model Congress and the Pentagon have used to plan and execute the Pentagon’s spending was originally built for long-term hardware acquisition. But this structure doesn’t apply well to the agile software development model. 

The department has been experimenting with using a separate appropriations category for software. The idea started to gain traction in 2019, when the Defense Innovation Board found that “colors of money tend to doom” software programs. “We need to create pathways for “bleaching” funds to smooth this process for long-term programs,” the board wrote in its report. 

But lawmakers have been hesitant to authorize broader adoption of this pathway beyond a small number of pilot programs until the Defense Department is able to produce data comparing this approach to traditional appropriation practices.

“Agile funding … we have to have that in the right focus area to be able to apply it to modern software, and it’s a little more difficult than we think because it involves Congress … But these are the steps we’re taking,” Obadal said.

Obadal also urged industry to “build [systems] to scale, don’t build it to demo.”

“What we’re asking from industry as we tackle those things is the confidence in your solution to scale, not just demo … That means that you have to take extra steps, and you have to think about what happens in a year or two years for you. Open architectures, interoperable designs, secure by design software, not bolted-on cybersecurity. That’s another incredibly important one, is your design and a willingness to align with Army timelines and with our operational realities,” he said.

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The Pentagon doesn’t know exactly how many civilian employees telework or work remotely across the Department of Defense, according to the Government Accountability Office.

While DoD has good data on which positions are eligible for telework or remote work, it does not consistently track whether civilian employees are actually using those programs. As a result, official figures have at times overstated remote work usage by counting eligible positions instead of the number of employees approved to telework or work remotely, a new watchdog report shows.

In May 2024, for instance — a period within the December 2021 to February 2025 span reviewed in the new GAO report — the Pentagon publicly reported it had 61,549 remote employees. One month later, however, the Defense Department told GAO it had 35,558 remote workers.

“The reason that happened is because they were reporting position eligibility. They were not reporting the individual employees. That’s exactly what we found — they had good data on the positions eligible but didn’t have such good data on who was actually using those programs,” Alissa Czyz, director of defense capabilities and management at GAO, told Federal News Network.

“We found that two-thirds of the positions in 2024 were eligible for telework, but the data were not very good when you got to the individual employee level,” she added.

Czyz said her team found that most DoD civilians were already working in person even before the current return-to-office policy, and that fully remote workers made up only a tiny fraction of the workforce.

“According to our data, the vast majority of civilians — about 81% — were in person. About 1% were doing remote work. That perception that large amounts of federal employees were teleworking, at least at the Department of Defense, did not bore out in our analysis,” Czyz said. 

Since President Donald Trump terminated remote work for federal employees, about 8% of the DoD civilian workforce — roughly 62,000 employees — had not returned to in-person work. About 6%, or 45,000 workers, did not return to office after accepting offers for deferred resignation. The government used the deferred resignation program last year to reduce the size of the federal workforce. Another 2%, or about 17,000 people, did not return due to reasonable accommodations.

No formal review of telework, remote work

Office of Personnel Management guidance requires agencies to evaluate how telework and remote-work programs affect their mission, employee recruitment and retention, and operating costs. However, GAO found that the Defense Department has not evaluated the impact of those programs on the department’s broader goals.

While there were scattered efforts across the department to assess some aspects of telework and remote work, there was no comprehensive, departmentwide evaluation of both benefits and drawbacks of those programs. One data source — the Federal Employee Viewpoint Survey — previously included telework-related questions, but OPM canceled the survey this year. 

Czyz said her team was able to gather some anecdotal feedback on telework and remote work, with DoD officials citing benefits such as improved communication, recruitment advantages for hard-to-fill positions and potential cost reductions. Some disadvantages included reduced in-person collaboration and decreased morale among employees who were not eligible for telework. But ultimately officials were not able to provide concrete data demonstrating cost savings or other outcomes.

“I mean, the bottom line was they were not conducting formal evaluations of telework or remote work,” Czyz said. “There was maybe some anecdotal cost savings with reduction in office space and that sort of thing, but there had been no formal evaluation of cost savings in the department.”

DoD also hasn’t assessed whether increased in-person requirements have created new costs, but GAO is examining those potential increases as part of a separate review of the department’s use of office space. That review comes as DoD seeks to reduce its office footprint while simultaneously bringing employees back to the office. GAO expects to release that report in early spring.

The Pentagon updated its telework policy in 2024 for the first time since 2012, instructing DoD components to “actively promote” telework and remote work and to eliminate barriers to program execution through education and training. The department has since rolled back the policy.

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The Defense Department has long tried to simplify and reform the reserve duty status system, which has expanded to more than 30 separate statutes scattered across about 20 different titles of federal law. 

This complex system has created pay and benefits inequities and frequent administrative delays when National Guard members and reservists shift between duty statuses.

A new bipartisan bill now seeks to consolidate dozens of duty statuses under which National Guard members and reservists are called to service to just four.

If passed, the Duty Status Reform Act would ensure service members performing assignments in the same category receive the same pay and benefits. 

Rep. Gil Cisneros (D-Calif.), the bill’s sponsor, said the effort is his “number one priority returning to Congress.”

“With the current duty status system, service members doing similar jobs often receive significantly less benefits due to them being under different duty statuses. Currently, at any point during activation, a Guardsman can go between up to 10 different duty statuses, resulting in lapses of pay and administrative hurdles. This bipartisan bill fixes existing problems like this and puts active duty under our one category,” Cisneros, a Navy veteran who returned to the House in 2025 after serving from 2019 to 2021, said at a Jan. 8 press conference.

The current system is a product of decades of patch fixes done by Congress spanning from World War II to the Global War on Terror. And while the Defense Department has attempted to overhaul the system over the last two decades, most efforts have failed to gain traction.

“It’s been a very gradual build up process, and so over time, there have been these gaps that have been developed where a reserve component member may be doing duty of one sort right next to reserve component duty person doing that kind of duty right next to them and they’re receiving potentially different pay and benefits. Or it could be the case where they’re on one sort of duty, they come to do their next day of duty, and they’re on a different status, and their underlying pay and benefits may change,” Lisa Harrington, senior operations researcher at RAND, told Federal News Network in August.

The bill builds on a Defense Department–commissioned RAND report that recommended consolidating the reserve duty status system into four categories, including contingency duty, training and support, reserve component duty and remote assignments.

Contingency duty covers deployments and mobilizations where reservists and National Guard members are called to serve, usually involuntarily, for combat operations, national emergencies, disaster response or other missions requiring additional manpower. 

Training and support assignments include required training, administrative assignments or support to other units. 

Reserve component duty, which is most commonly associated with traditional reserve service, includes training periods, administrative assignments and support activities.

Remote assignments are designed to account for duty that can be completed virtually, such as online courses.

“Let me be clear about what this bill does and what this bill does not do. It does not create new entitlements, new pay or new benefits. It does align existing benefits so service members performing the same mission alongside their active duty counterparts receive the same rights, protections and predictability. This is about parity and fairness, not expansion,” retired Maj. Gen. Francis M. McGinn, president of the National Guard Association of the United States, said at the press conference.

It is unclear what strategy the lawmakers plan to pursue to pass the measure, but Cisneros said he has spoken with Rep. Adam Smith (D-Wash.), ranking member on the House Armed Services Committee, and plans to meet with HASC Chair Mike Rogers (R-Ala.).

“I think now is the time to move it forward, and we’re going to keep working to make sure that it does get over across the finish line,” Cisneros said.

Rep. Jack Bergman (R-Mich.), the bill’s cosponsor, said he is “more than cautiously optimistic on the timing that we have here.”

“When you think of a defense dollar, we don’t talk about the totals, but how do we spend a defense dollar in the right way without overspending? But also the very subtle part of this — in the end, if we do it right, it’s about our readiness, but it’s also about the recruiting and retention of those men and women who have not even yet thought about serving,” Bergman said. 

Harrington said the potential cost of the reform might be one of the concerns since accurately predicting how much the reform would ultimately cost is difficult.

“The costs we think are not something that would stop the reform from happening when people understand exactly how the costs play out,” she said.

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A new bill will require the Pentagon to assess whether its current efforts to recruit, train and retain cyber talent are working — and to produce a new department-wide plan aimed at addressing persistent cyber workforce gaps.

The legislation, titled the Department of Defense Comprehensive Cyber Workforce Strategy Act of 2025, tasks the Pentagon with developing a cyber workforce strategy and delivering a detailed report to Congress by Jan. 31, 2027. 

Sens. Gary Peters (D-Mich.) and Mike Rounds (R-S.D.), the bill’s sponsors, want the Pentagon to assess progress made and remaining gaps in implementing the DoD’s 2023–2027 Cyber Workforce Strategy, and identify which elements of the current strategy should be continued or dropped. 

The lawmakers are also requesting detailed workforce data, including the size of the cyber workforce, vacancy rates, specific work roles and other data related to personnel system metrics.

In addition, the legislation calls for a detailed analysis of the Defense Cyber Workforce Framework itself, including its goals, implementation efforts, the milestones used to track progress and the performance metrics used to determine whether the cyber workforce strategy is actually effective. The Defense Department issued the framework in 2023 to establish an “authoritative lexicon based on the work an individual is performing, not their position titles, occupational series, or designator.” The goal of the framework is to give the Pentagon a clearer picture of its cyber and IT workforce, which has been difficult since cyber-related work often falls under traditional military jobs titles that do not clearly reflect those job responsibilities.

The Pentagon would also be required to identify “any issues, problems or roadblocks” that have slowed implementation of the framework — and outline steps taken to overcome those barriers.

The legislation encourages the Defense Department to explore alternative personnel models, including cyber civilian reserve or auxiliary forces, and to leverage talent management authorities used by other federal agencies. The Pentagon would also be required to examine the use of commercial tools for tracking workforce qualification and certifications, identifying talent and skills in existing personnel management systems.

The bill further calls for partnerships with universities and academic centers of excellence to improve workforce development and talent acquisition.

The Pentagon would be required to provide Congress with a timeline and estimated costs for implementing the new cyber workforce strategy.

The bill comes amid personnel reductions across the Defense Department over the past year, including at key cyber organizations such as U.S. Cyber Command and the Defense Information Systems Agency. The Pentagon faces a shortage of approximately 25,000 cyber professionals. 

In May, the Defense Information Systems Agency, for instance, said it expected to lose nearly 10% of its civilian workforce due to the deferred resignation program and early retirements. The organization said it was experimenting with automation and artificial intelligence to offset the impact of workforce reductions.

Meanwhile, Cyber Command lost 5 to 8 percent of its personnel amid the department’s efforts to shrink its civilian workforce.

The Pentagon has lost approximately 60,000 civilian employees since President Donald Trump took office.

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President Donald Trump took aim at defense contractors Wednesday, announcing new restrictions on executive pay and stock buybacks as part of the administration’s push to speed procurement and revitalize the defense industrial base. 

In an executive order issued late Wednesday, Trump said companies “are not permitted in any way, shape, or form to pay dividends or buy back stock, until they are able to produce a superior product, on time and on budget.”

The order directs Defense Secretary Pete Hegseth to identify defense contractors providing critical weapons, supplies and equipment that are “underperforming, not investing their own capital into necessary production capacity, not sufficiently prioritizing U.S. government contracts, or whose production speed is insufficient as determined by the Secretary,” while simultaneously engaging in stock buybacks or corporate profit distributions. 

Contractors identified under the review must be notified and given an opportunity to submit a remediation plan within 15 days to address performance issues. 

If disputes over underperformance issues cannot be resolved within 15 days or the remediation plan is deemed inadequate, the defense secretary “may initiate immediate actions to secure remedies for the secretary that will expedite production, prioritize the U.S. military and return the contractor to sufficient performance, investment, prioritization and production, to the maximum extent permitted by law.”

The executive order also directs the Defense Department to ensure that future contracts with new or existing defense contractors include provisions prohibiting stock buybacks and corporate profit distributions during periods of underperformance, contract noncompliance, insufficient investment, or “insufficient production speed as determined by the secretary.”

The government already has a whole set of tools in its toolbox to incentivize, reward or penalize companies based on their performance, and the executive order relies in part on mechanisms the Defense Department already uses. What is different, however, are the remedies the administration is focusing on — and the main challenge in implementing this executive order will be defining the key parameters contractors are going to be held accountable for, Protorae Law member Alan Chvotkin said.

“The remedies of no stock buybacks and caps on executive compensation — that’s not a remedy that the government already has available to it,” Chvotkin told Federal News Network. “It’s not so binary to say it’s 100% of contractor’s problem or zero of the contractor’s problem, and that’s where the hard work is going to come on each of these major programs — defining the specific parameters that the department is expecting.”

Stan Soloway, president and CEO of Celero Strategies and federal acquisition expert, said the executive order seems to presume that any cost overrun is the fault of the contractor without recognizing that “not all cost overruns are created equal.”

“The [executive order] is full of vagaries and ambiguity. It is going to be very interesting to determine how they measure whether a company is performing … There’s no mention about the responsibility the Defense Department has for cost overruns and program delays. While companies are far from perfect, all too often, the delays are driven by changing requirements, by requirement rigidity, lack of flexibility in the requirements and by budget uncertainties,” Soloway told Federal News Network. 

Back in 2007, the Defense Science Board, for instance, examined three troubled programs — the Littoral Combat Ship, the presidential helicopter and the Army’s Comanche helicopter — and found that constantly changing government requirements were a major driver of cost overruns and schedule delays. The Packard Commission reached the same conclusion two decades before the Defense Science Board issued its report.

“Accountability is key here, but there is a shared responsibility between the government and contractors. There are many tools to hold contractors accountable, but way fewer tools to hold the government accountable. This EO doesn’t do anything to make the government more accountable,” David Berteau, former president and CEO of the Professional Services Council and now president of David Berteau & Associates, told Federal News Network.

“The disconnect of this EO is if the desired outcome is better contract performance, how can implementing this EO produce better results? That isn’t clear to me. Someone will have to write implementation guidance that does that. I spent a lot of my career writing implementation guidance, and I have a hard time seeing implementing this in such a way that it produces better performance quickly,” he added.

If the goal of the executive order is to push companies to invest in production capacity and capability rather than shareholder returns, that approach only works if there are returns on that investment, Berteau said.

Lockheed Martin’s recent deal with the Pentagon to increase Patriot missile interceptor production to about 2,000 missiles a year is a significant step toward that approach, Berteau said. Lockheed agreed to fund an expansion of its Patriot missile factory in exchange for a seven-year commitment from the Pentagon.

“We have to wait to see the implementation guidance to get a sense of what the real goal is, better contract performance leading to faster deliveries or what,” Berteau said.

“It is critical that the relationship between the government and contractors be one of shared responsibility and partnership, particularly around defining and deciding what the contract will give you and the structure of the contract to make sure the government will get what it needs. There is a lot about this EO that doesn’t seem to be about strengthening that partnership. It seems to be more about punishing one side of the equation,” he added.

The Defense Department did not respond to questions about whether contractors should expect formal guidance in the coming weeks or how many underperforming contractors it has already identified.

“After numerous years of failing to meet contractual obligations, under President Trump’s order, defense contractors will no longer be allowed to leave our warfighters behind while giving themselves massive payouts from stock buybacks. This will give Department of War the ability to meet national security objectives and ensure efficiency and accountability. Our obligation is to our warfighters; not Wall Street,” Chief Pentagon Spokesman Sean Parnell told Federal News Network in a statement. 

Executive pay

In one of his Truth Social posts, Trump said no executive should be allowed to make more than $5 million, but the figure did not make it into the executive order.

Instead, the president directed the defense secretary to ensure future contracts require executive compensation to be tied to performance — such as on-time delivery, increased production and “all necessary facilitation of investments required to rapidly expand the United States stockpiles and capabilities” — rather than short-term financial metrics like cash flow or earnings per share driven by stock buybacks.

If a contractor has “engaged in underperformance, non-compliance, insufficient prioritization of the contract, insufficient investment, or insufficient production speed,” the department could cap executive base salaries at current levels.

Executive compensation was a contentious issue in 2013, when President Barack Obama called on Congress to cap executive pay at $400,000.

A cap on executive compensation already exists in some form — contractors can pay their executives whatever they choose, but the government only reimburses costs up to a certain limit.

The executive order, however, goes a step further — it’s shifting from how much the government will reimburse the contractor to limiting how much the company can pay its executives.

“Pretty significant difference, but maybe they’ll fall back on the same mechanisms. I don’t know that yet. Nobody in the department is talking yet about how they’re going to implement this. I’m sure they’re still trying to work that out,” Chvotkin said.

“I think there’s a fair question, broadly speaking, in commerce, generally, not just in the government market, about executives having the right incentives to drive long-term performance and excellence. But I don’t know what the standards are going to be, what the metrics are going to be.  There’s a ton of ambiguity in here,” Soloway said.

Who does the EO apply to?

While the executive order targets contractors that provide “critical weapons, supplies and equipment,” it doesn’t clearly define the term “critical.” 

Chvotkin said new contracts could easily specify which vendors qualify as critical suppliers or require all new contracts to include the provisions laid out in the executive order.

And while the executive order is broadly aimed at “all contractors,” Chvotkin said its likely target is traditional defense contractors rather than the commercial firms the Pentagon has been trying to attract. 

“I think it’s all contractors, but fixed-price contractors — less likely, they’re going to have binary decision. Commercial contractors, where the effort is to bring more of them in, but probably not as many of them have the triggers, the buyback, the sort of where the government is reimbursing for executive compensation as they do for many of the traditional defense contractors,” Chvotkin said. 

What’s next?

Chvotkin said the Defense Department is likely to issue general guidance to programs on how to carry out the secretary’s review.

“I think they’ve already done quite a bit of that, but I would expect [the undersecretary for acquisition sustainment office] to lead a fair amount of that responsibility to describe what those contracting provisions are relating to critical weapon systems and supplies and equipment. They’ve got to identify those first, then catch up with everybody else on a rolling basis,” Chvotkin said. 

“From the contracting folks, I would expect a broad set of contract provisions, both modifications to existing contracts, as well as provisions to go into new solicitations and new contracts to be awarded. That includes the identification of the key performance parameters for each solicitation and new award, the requirement for the company if notified by the Department of Defense or the contracting officer of the failure to adequately meet the performance objectives, the requirement for the remediation plan and then the additional remedies that the department might ask for as part of either the failure of the contractor to meet the original contract performance of projections or the remediation plan,” he added.

Jason Miller contributed to this report.

If you would like to contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or reach out on Signal at (301) 830-2747.

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A bipartisan group of lawmakers wants the Defense Department and the Department of Veterans Affairs to use a single credentialing and privileging system for medical providers, which would allow clinicians to move between DoD and VA facilities without having to go through months-long approval processes.

Currently, the DoD and the VA rely on separate credentialing and privileging systems to approve their clinicians. But those approvals don’t transfer between the two agencies, forcing providers who switch facilities to restart the approval process from the beginning. The process can take several months, during which clinicians are unable to see patients, which delays access to care and leaves facilities understaffed.

The legislation, introduced by Sens. Jacky Rosen (D-Nev.) and Marsha Blackburn (R-Tenn.), would require DoD and VA to provide Congress with a report on the medical provider credentialing and privileging systems they currently use. The report would assess what data each system stores, how portable provider’s credentialing and privileging information is, how interoperable the systems are and where gaps or limitations exist in their interoperability. It would also require recommendations for scaling those systems with the goal of establishing a single, uniform credentialing and privileging system across both departments.

Under the bill, the Pentagon and the VA would have to jointly select a single credentialing and privileging system by January 2027 and notify Congress that the system is operational by 2028.

“Health care providers shouldn’t be hindered by bureaucratic red tape when caring for the men and women who have bravely served our nation. Our bipartisan legislation would end unnecessary duplication so that medical providers can move between the DoD and VA more quickly, ensuring service members and veterans get the high-quality care they need without delay,” Blackburn said in a statement. 

The credentialing process ensures that providers treating service members and veterans meet required qualifications. Meanwhile, privileging determines the medical services a provider can deliver based on their qualifications and experience.

Reps. Greg Murphy (R-N.C.) and Susie Lee (D-Nev.) introduced a companion bill in the House titled the “Department of Defense and Department of Veterans Affairs Medical Credentialing Integration Act of 2025.”

“This legislation is a strategic opportunity for the advancement of healthcare priorities throughout the federal sector healthcare system that strengthens workforce recruitment and retention, refines effective government health agency practices and provides for service members and veterans, all while safeguarding and better utilizing Americans’ hard-earned tax dollars,” Murphy said in a statement. 

It is unclear what strategy the lawmakers plan to pursue — while it’s a bipartisan effort, standalone bills often face political hurdles, and lawmakers frequently try to attach such proposals to larger legislative packages like the annual National Defense Authorization Act to increase their chances. 

The DoD only recently streamlined its privileging process, which now allows medical providers to move between military treatment facilities with minimal administrative delays. 

As of October, providers no longer have to reapply for their clinical privileges when moving within the enterprise, including across stateside and overseas military hospitals and clinics.

“Health care providers should be able to focus on their patients. With portable privileges, they can do so more quickly,” Stephen Ferrara, acting assistant secretary of defense for health affairs, said in a statement. “Enterprise-wide privileging is just one of many efforts to make the Military Health System more agile. Previously, our health care providers renewed their privileges every two years. With this expanded policy, we have extended the renewal window to three years to reduce their administrative load.” 

The Military Health System said the process of obtaining clinical privileges remains the same under the new policy.

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The Military Family Advisory Network is conducting its biennial survey to better understand the needs of military and veteran families worldwide. The survey — the largest independent research effort focused on the military family population — has helped shape major policy and quality-of-life reforms, including the Military Housing Privatization Initiative Tenant Bill of Rights and the creation of a congressional quality-of-life panel for service members and their families.

Unlike many surveys focused on military families, MFAN manages the research process internally from start to finish, which allows the organization to analyze its findings beyond broad, high-level trends.

“We know that there is not one experience that applies for all military families. There are a lot of variations based on where you’re living, based on your family size, based on your rank, based on your branch. And so what we’re able to do is dig into our findings in a way that gives us really concrete and actionable data, so that we’re not trying to boil the ocean with the solutions that we put in place,” Shannon Razsadin, MFAN’s chief executive officer, told Federal News Network.

“It’s very important, and it is very much counted on by a variety of different stakeholders as they shape policy and programs that military families count on,” she added.

MFAN opened the survey in October but paused its outreach efforts during the government shutdown. “We felt that it was too much to ask people in such a time of immense stress to take the time to complete the survey,” Razsadin said.

It has since ramped up outreach and is monitoring response rates to determine when to close the survey. The organization received over 10,000 responses in the last survey cycle. 

Razsadin said MFAN’s research has helped drive several quality-of-life reforms — the Senate Armed Services Committee relied on its study on military housing, which became the “cornerstone” for privatized housing reforms. When the organization’s research first identified food insecurity issues in the military, it launched the One Million Meals Challenge, distributing over a million meals to military families living in places where MFAN’s data showed the highest need.

Further analysis, however, revealed a key driver for food insecurity among military families — a previous study showed that 51% of respondents who had moved in the last two years were food insecure. In response, the organization launched its PCS Restock Program, providing families with household essentials and pantry staples after a permanent change of station move. 

“That’s a tangible example of how MFAN has used our data to drive really important programmatic decisions while at the same time advocating from the policy perspective, because policy takes time, and oftentimes military families don’t have that luxury. These things are about moving on parallel tracks, with the ultimate goal of those intersecting from where programs and policies can meet,” Razsadin said.

“This research effort is for a whole-of-ecosystem approach, because there is no one organization out there, even the government, who can do all things for all people. And so it’s really making sure that we have the data, we are sharing it proactively. We are maintaining the highest levels of institutional review board standards so you can trust this data, that it has gone through the most rigorous review process possible. That has been very helpful for us in making sure this research effort stands up on the Hill, within the Pentagon, to make sure that it can really drive the change possible,” she added.

Issues covered in the survey

The survey examines a wide range of military family wellbeing issues, including finances, housing, childcare and PCS moves, but respondents are only asked questions relevant to their life. Respondents without children, for instance, won’t be asked about education and childcare.

While the survey includes perennial questions asked in every cycle, the organization introduces new topic areas based on feedback from the community. This year, MFAN added questions examining online gambling.

“We’ve heard a lot, and just even outside the military population, online gambling has hit a new level. It is very accessible, and it’s something that we want to understand what’s happening there. But also, what are the intersection points between things like online gambling and financial security? What are some of the intersection points between that and loneliness or social isolation? We’re really interested to see if this is something that is a broad issue or is something that is being consumed at very high levels within the military population, but what also are some of the implications related to that, and what could be some of those drivers that we’ll need to dig deeper into as an organization,” Razsadin said. 

For the first time, MFAN has incorporated methodology designed to produce findings representative of the broader military community. Razsadin said it will allow the organization to speak more confidently about trends across the military population rather than just the experiences of survey respondents.

“It was an intensive effort from a research design perspective, and we’re really looking forward to releasing those findings, and we think that it will give the data even more legs than it had before,” Razsadin said.

MFAN also uses validated measurement scales throughout the survey, which allows the organization to create “apples-to-apples comparisons” between the military population and the civilian population. 

“This allows us to really have data that we can then bring to the Hill and other stakeholders and say, ‘This is how the military population is stacking up as compared to the civilian population,’ which has been really helpful for us in the advocacy work that we do as an organization,” Razsadin said.

Recently, the organization has been focusing its advocacy efforts on increasing military pay and examining the basic allowance for housing, particularly how the system could be made more responsive — and possibly more predictive — to changing housing market conditions. The survey data will shape MFAN’s policy priorities for the next several years.

“It’s so important that we hear from people through this research effort, because it really does shape the future as far as what is discussed within the Pentagon, what is discussed on the Hill, and making sure that the well-being of military families always stays at the forefront as not just a nice-to-have, but as a must-have, and that’s more important now than ever,” Razsadin said.

MFAN plans to release its findings in May.

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Lawmakers said the fiscal 2026 defense policy bill that became law earlier this month would deliver “the most significant acquisition reforms in a generation.” But some of the more sweeping proposals introduced in the House and Senate versions of the bill were ultimately scaled back or dropped entirely from the final version of the legislation.

A similar dynamic played out inside the Pentagon. A draft acquisition memo circulated prior to Defense Secretary Pete Hegseth’s speech to defense executives and senior military acquisition officials outlined a far more aggressive overhaul of how the department would develop and buy military capabilities than what emerged in the final version of the memo and the Acquisition Transformation Strategy.

But a number of provisions from the House’s SPEED Act and Senate’s FoRGED Act that survived negotiations are still expected to be impactful, including measures aimed at streamlining prototyping, accelerating the transition of technologies into production and expanding opportunities for small businesses and new entrants.

Easing regulatory burdens for nontraditional contractors

The bill, for example, exempts nontraditional defense contractors from some of the Pentagon’s accounting, audit and compliance requirements, lowering barriers to entry for new defense technology companies. A nontraditional defense contractor is defined as a contractor that hasn’t held a Cost Accounting Standards-covered contract in the last year, which is the vast majority of the defense industrial base — George Mason’s Baroni Center for Government Contracting estimates that only 7.5 percent of the defense companies fall outside that definition. The Senate also pushed to expand the definition of nontraditional defense contractors, but the provision was dropped from the final version of the bill.

The legislation also expands the type of past performance that may be considered — the department is required to issue guidance on when it should accept a wider range of past performance, including commercial or non-government work as valid past performance. It also requires the Defense Acquisition Regulations Council to “identify and eliminate specific, unnecessary procedural barriers that disproportionately affect the ability of small business concerns and nontraditional defense contractors, to compete for contracts with the Department of Defense.”

Small and medium-sized Defense Department contractors will also gain access to an online platform offering digital resources, training and services aimed at increasing awareness of and facilitating compliance with defense acquisition requirements.

Faster paths from prototype to production

The bill also expands the Pentagon’s ability to use Commercial Solutions Openings — a competitive process used to acquire innovative technologies. CSOs are typically difficult to transition, but the legislation allows the department to move successful CSOs into production, including through sole-source contracts. The provision also expands CSOs to include commercial products, commercial services and nondevelopmental items instead of limiting their use to “innovative” technologies.

Another provision raises the minimum award for the Accelerate the Procurement and Fielding of Innovative Technologies program to $10 million.

The bill also gives combatant commanders the authority to experiment with, prototype and demonstrate new technologies and allows a successful experimentation to serve as justification for moving directly into production. 

Stan Soloway, president and CEO of Celero Strategies and federal acquisition expert, said the provisions aimed at accelerating the transition to production and giving officials clearer authority to favor small businesses and new entrants reflect the department’s long-standing effort to work around traditional program processes and system integrators. But given the complexity of many programs, “it remains to be seen how much it actually changes on major systems, but it could definitely impact smaller ones” he told Federal News Network.

Data rights and IP

At the same time, there is a seeming contradiction in the bill.

Despite broad bipartisan support, right-to-repair provisions were stripped from the final version of the bill, but “provisions like the one that talked about DoD having the authority to re-engineer components when it thinks doing so will be quicker and less expensive than having additional units produced by the original equipment manufacturers, is sure to raise hackles,” Soloway said.

“IP and technical data rights are hugely important issues. And it is fair to say that both government and industry have tended to view them as zero sum games. But if DoD wants to build meaningful bridges to emerging (and existing) firms and technology, the answer lies in both sides being willing to negotiate, at the very beginning of a program, how those questions will be handled. It is hard … but simply stating that DoD can do this when they think it is in their best interests, is probably not the most balanced path forward,” Soloway said.

Workforce largely absent

Despite some of the significant acquisition changes, the legislation barely addresses the workforce — a gap Soloway said could undermine the reforms.

The success of these reforms will hinge on whether the department can equip its workforce with the skills needed to operate differently. Otherwise, the system can quickly revert to its old ways.

“Without an aggressive, broad-based and sustained workforce initiative, it is hard to see the workforce having the tools or the confidence to take the kind of reasoned risks the legislation, and Secretary Hegseth, claim to want them to take,” Soloway said

“Overall, workforce morale and trust in leadership is at a very low ebb. If change is going to happen, dealing with that reality is job one. But, to date, nothing this administration has done would suggest they have any plan on how to do that,” he added.

If you would like to contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or reach out on Signal at (301) 830-2747.

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The Army is creating a dedicated artificial intelligence and machine-learning career field for officers as it pushes to integrate AI more deeply into its operations.

The new 49B specialty establishes artificial intelligence and machine learning as an official “area of concentration” for Army officers, a move the service says will help accelerate its transformation into a more data-centric and AI-enabled force.

The Army will roll out the new career field in phases. Army officers interested in transferring will be able to apply through the service’s Voluntary Transfer Incentive Program beginning Jan. 5. Selected officers are expected to formally transfer into the new career field by October 2026. 

“We’re building a dedicated cadre of in-house experts who will be at the forefront of integrating AI and machine learning across our warfighting functions,” Army Spokesperson Lt. Col. Orlandon Howard said in a statement.

The Volunteer Transfer Incentive Program allows active-duty officers in the competitive category to voluntarily transfer into a different branch or functional area based on Army manning needs. Human Resources Command typically opens application windows once or twice a year, depending on a branch’s strength and personnel requirements.

Officers selected for transfer will incur a three-year active-duty service obligation, which will begin after completion of all required training.

The specialty will be open to all officers eligible for the voluntary transfer program, but those with advanced academic degrees or technical experience in AI- and data-related fields are expected to be more competitive candidates.

Selected officers will undergo graduate-level training and “gain hands-on experience in building, deploying and maintaining” the service’s AI-enabled systems.

The Army is also considering expanding the specialty to include warrant officers in the future.

The service created a new robotics tech warrant officer career field earlier this year to provide tactical units with in-house experts who can deliver robotic and autonomous capabilities directly to soldiers. The role includes training on unmanned and counter-unmanned systems, as well as networking, software engineering, electronic warfare, artificial intelligence and machine learning.

The decision to establish a new AI and machine-learning career pathway for officers comes amid a broader transformation effort aimed at preparing the Army for future warfare and optimizing its force structure and workforce. Earlier this year, Defense Secretary Pete Hegseth directed the Army to enable AI-driven command and control at theater, corps and division headquarters by 2027, field unmanned systems across every division by the end of 2026, and accelerate the integration of counter-UAS capabilities at the platoon level by 2026. 

The Army also brought in four senior executives from tech giants like Palantir and Meta to be part of Detachment 201, the service’s new executive innovation corps. The four men were sworn into the Army Reserve as direct-commissioned officers in June and work at companies heavily invested in artificial intelligence and machine learning.

Meanwhile, the Defense Department has been pushing the use of large language models across the force — earlier this month, the department launched GenAi.mil, a platform designed to put “frontier AI models” into the hands of warfighters. DoD selected Google Cloud’s Gemini for Government as the first AI deployed on the new platform. 

“The future of American warfare is here, and it’s spelled AI,” Hegseth said.

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The Defense Department is expanding secure methods of authentication beyond the traditional Common Access Card, giving users more alternative options to log into its systems when CAC access is “impractical or infeasible.”

A new memo, titled “Multi-Factor Authentication (MFA) for Unclassified & Secret DoD Networks,” lays out when users can access DoD resources without CAC and public key infrastructure (PKI). The directive also updates the list of approved authentication tools for different system impact levels and applications.

In addition, the new policy provides guidance on where some newer technologies, such as FIDO passkeys, can be used and how they should be protected. 

“This memorandum establishes DoD non-PKI MFA policy and identifies DoD-approved non-PKI MFAs based on use cases,” the document reads.

While the new memo builds on previous DoD guidance on authentication, earlier policies often did not clearly authorize specific login methods for particular use cases, leading to inconsistent implementation across the department.

Individuals in the early stages of the recruiting process, for example, may access limited DoD resources without a Common Access Card using basic login methods such as one-time passcodes sent by phone, email or text. As recruits move further through the process, they must be transitioned to stronger, DoD-approved multi-factor authentication before getting broader access to DoD resources.

For training environments, the department allows DoD employees, contractors and other partners without CAC to access training systems only after undergoing identity verification. Those users may authenticate using DoD-approved non-PKI multi-factor authentication — options such as one-time passcodes are permitted when users don’t have a smartphone. Access is limited to low-risk, non-mission-critical training environments.

Although the memo identifies 23 use cases, the list is expected to be a living document and will be updated as new use cases emerge.

Jeremy Grant, managing director of technology business strategy at Venable, said the memo provides much-needed clarity for authorizing officials.

“There are a lot of new authentication technologies that are emerging, and I continue to hear from both colleagues in government and the vendor community that it has not been clear which products can and cannot be used, and in what circumstances. In some cases, I have seen vendors claim they are FIPS 140 validated but they aren’t — or claim that their supply chain is secure, despite having notable Chinese content in their device. But it’s not always easy for a program or procurement official to know what claims are accurate. Having a smaller list of approved products will help components across the department know what they can buy,” Grant told Federal News Network.

DoD’s primary credential

The memo also clarifies what the Defense Department considers its primary credential — prior policies would go back and forth between defining DoD’s primary credential as DoD PKI or as CAC. 

“From my perspective, this was a welcome — and somewhat overdue — clarification. Smart cards like the CAC remain a very secure means of hardware-based authentication, but the CAC is also more than 25 years old and we’ve seen a burst of innovation in the authentication industry where there are other equally secure tools that should also be used across the department. Whether a PKI certificate is carried on a CAC or on an approved alternative like a YubiKey shouldn’t really matter; what matters is that it’s a FIPS 140 validated hardware token that can protect that certificate,” Grant said.

Policy lags push for phishing-resistant authentication

While the memo expands approved authentication options, Grant said it’s surprising the guidance stops short of requiring phishing-resistant authenticators and continues to allow the use of legacy technologies such as one-time passwords that the National Institute of Standards and Technology, Cybersecurity and Infrastructure Security Agency and Office of Management and Budget have flagged as increasingly susceptible to phishing attacks.

Both the House and Senate have been pressing the Defense Department to accelerate its adoption of phishing-resistant authentication — Congress acknowledged that the department has established a process for new multi-factor authentication technologies approval, but few approvals have successfully made it through. Now, the Defense Department is required to develop a strategy to “ensure that phishing-resistant authentication is used by all personnel of the DoD” and to provide a briefing to the House and Senate Armed Services committees by May 1, 2026.

The department is also required to ensure that legacy, phishable authenticators such as one-time passwords are retired by the end of fiscal 2027.

“I imagine this document will need an update in the next year to reflect that requirement,” Grant said.

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The year 2025 has been transformational for the Defense Department. The Air Force scrapped most of its sweeping reoptimization initiative announced under previous leadership, while the Army undertook one of its most significant acquisition and organizational reform efforts in decades. 

Air force drops Biden-era reoptimization efforts 

Months after pausing its sweeping reoptimization initiative launched under former Air Force Secretary Frank Kendall, the service announced earlier this month that it would abandon more than half of its sweeping efforts. The proposed changes under the previous leadership were enormous in scope, spanning acquisition, recruiting, training and the management processes that deliver support services.

When Kendall announced the changes in 2023, he said it had “become clear to the entire senior leadership team” that the service was not well positioned for great power competition after spending more than two decades supporting post-9/11 conflicts and demands.

Meanwhile, Air Force Secretary Troy Meink said some of the most sweeping reorganization efforts would be too disruptive.

For example, the Air Force announced it would create a new Air Base Wing organizational model under the sweeping reoptimization effort. The idea was to establish separate Air Base Wings with their own command structures to allow Combat Wings to focus solely on training and warfighting. 

Meink said the decision to abandon these plans was made to “minimize change-fatigue to Airmen and enable commanders to concentrate on readiness, lethality, and mission accomplishment.”

Perhaps most notably, the Air Force scrapped plans to stand up a new Integrated Capabilities Command that would have overseen the service’s requirements process. A provisional version of the command was stood up a year ago, and functioned as the primary organization overseeing requirements for purchasing weapons. Instead, the leadership will fold its functions into the Air Force Futures, known as A5/7 by April 1, 2026.

One of the most popular changes, to bring back warrant officers within the cyber and information technology professions, will remain. For decades, the Air Force was the only service without warrant officers. 

Meanwhile, the Space Force will continue implementing key elements of  re-optimization efforts that were specific to the service.

Marine Corps Force Design update 

The service kicked off its major “Force Design 2030” initiative in 2020 to better align itself with the National Defense Strategy and redesign its force for naval expeditionary warfare. The 10-year initiative is now simply known as “Force Design,” and while the service is still on track with the effort, budget uncertainty could affect the service’s ability to meet the initiative’s critical milestones, Marine Corps Commandant Gen. Eric Smith said earlier this year. 

In its 2025 Force Design update, released in October after the service skipped a public update in 2024, the Marine Corps said it continues to stand up Marine Littoral Regiments — specialized units within the Marine Corps that are designed to operate in contested coastal areas.

The Corps is extending many of the advanced capabilities fielded in those regiments — including the air defense system, resilient command-and-control systems, unmanned platforms and advanced sensors — across Marine Expeditionary Units.

“This modernization strengthens the MEU’s role as a versatile, multi-domain naval expeditionary force from the sea, able to project power, seize and hold key maritime terrain, sense and make sense of the operating environment, integrate with the fleet, and directly contribute to joint kill webs,” the Force Design update reads.

In addition, the service is undertaking what it calls the most significant modernization of its Marine Air Command and Control System in a generation, merging legacy air support and air defense functions and reorganizing Marine Air Control Groups so Marines can be trained and employed in multiple roles within Marine Air Operations Centers.

The Corps is also embracing the idea of managing the acquisition system as portfolios of capabilities rather than individual programs. One example is the new capability portfolio approach in Program Executive Officer Land Systems, which will give a program responsibility for a suite of programs under a common capability area. Marine leaders say the shift will allow multiple systems to be developed and fielded together, with continuous input from the Fleet Marine Force, instead of advancing programs in isolation with a primary focus on cost.

The service’s Force Design sparked a great deal of debate, with critics arguing that the changes would weaken the Marine Corps as a combined arms force due to its divestments in armor, artillery, and aviation capabilities, limit its ground mobility and that the Marines would be less capable fighting in urban environments.

Army Transformation Initiative 

Shifting away from managing individual programs to a portfolio-based structure is a big part of the Army’s transformation initiative announced in May. Stan Soloway, president and CEO of Celero Strategies and federal acquisition expert, said the move is a continuation of what the service has already been doing and “maybe somewhat of an acceleration.”

“There’s nothing radical about it,” Soloway told Federal News Network.

But Defense Secretary Pete Hegseth’s move to require the Army to include right-to-repair provisions in all new and existing contracts to cut costs and reduce delays caused by relying on original manufacturers for maintenance and support “might be one of the most important lines on the whole memo,” he said.

“In many ways, it is one of the huge issues they have to deal with,” Soloway said. 

Modifying existing contracts to fix intellectual property issues is not ideal, but the government also has no choice — there are too many existing contracts, some of which may have been created years ago, with flawed IP clauses. It remains to be seen whether the Army’s acquisition workforce is equipped to negotiate these kinds of provisions effectively.

Meanwhile, right-to-repair provisions that had broad bipartisan support in the fiscal 2026 defense policy bill, were stripped from the final version of the legislation after industry pushback. 

Greg Williams, director of the Center for Defense Information at the Project on Government Oversight, said while this is the opportunity for the Pentagon to exercise its existing authorities, without legislation that enforces consistency, it’s very unlikely that contracting officers will be able to effectively implement right to repair across thousands of contracts. 

If you would like to contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or reach out on Signal at (301) 830-2747.

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Defense Secretary Pete Hegseth has directed all department heads to recognize “outstanding” Defense Department civilian employees with cash bonuses.

A Dec. 15 memo authorizes Pentagon leaders to award the top 15% of civilian employees bonuses worth 15% to 25% of their basic pay, capped at $25,000.

Hegseth said if department heads want to recognize more than 15% of their civilian workforce with cash awards, they can do so within their internal budget.

“Since the dawn of the Republic, civilian employees have played an essential, foundational role in driving the success of America’s military and ensuring it prevails on the battlefield. Over the past 10 months, Defense Department civilians upheld that proud tradition through their steadfast support of the worldwide mission of U.S. armed forces and their dedication to executing the transformational changes necessary to revive the warrior ethos, rebuild our military, and reestablish deterrence,” Hegseth said in the memo.

“These achievements have not been easy. The uncertainty and adversity inherent in all periods of change can test even the most elite workforce. Further, the longest Government shutdown in American history imposed severe strain on our civilian workforce. The resilience our civilian teammates have demonstrated throughout this challenging time is an inspiration and deserves to be recognized,” he added.

Department heads are required to coordinate with their financial management and comptroller organizations to confirm funding availability for these awards. 

Hegseth said the effort to reward the department’s “very best” civilians is separate from any previously issued awards and directed department heads to issue the bonuses by Jan. 30.

“I am enormously grateful for the incredible contributions of our entire civilian workforce, and I am proud to work with everyone in the Department, military and civilian, in defending our nation,” Hegseth said.

The memo builds on earlier guidance from Undersecretary of Defense for Personnel and Readiness Anthony Tata that seeks to expand the use of civilian workforce incentives and awards to recruit and retain top talent. The document encourages broader use of existing incentives, including cash awards up to 20% of basic pay and time off awards up to 80 hours per year, to “recognize exceptional civilian contributions,” particularly in high-impact or hard-to-fill roles. It also eases approval requirements for large cash awards.

The memo to recognize top talent comes amid Hegseth’s broader push to shrink and reshape the Pentagon’s civilian workforce — an effort he once described as “clearing out the debris.”

The department has lost more than 60,000 employees since the beginning of the Trump administration through voluntary separation programs, reaching the 5% to 8% reduction goal Hegseth set earlier this year. In addition, the Defense Department, along with other federal agencies, remains under a near-total civilian hiring freeze that has been extended indefinitely to further reduce the size of the federal workforce. 

President Donald Trump and Hegseth also announced “warrior dividend” bonuses for service members last week, which Trump suggested would be funded by tariff revenue. The payment is actually a one-time basic allowance for housing stipend and will be paid using funds Congress appropriated to the DoD in the One Big Beautiful Bill Act to supplement the basic allowance for housing.

If you would like to contact this reporter about recent changes in the federal government, please email anastasia.obis@federalnewsnetwork.com or reach out on Signal at (301) 830-2747.

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Some service members stationed within the continental United States will see their take-home pay decrease starting January after the Defense Department updated its cost-of-living allowance rates (COLAs).

All 21 non-metropolitan counties in California and New York will lose COLA allowance eligibility under the Defense Department’s 2026 rates released Monday. 

Nine military housing areas will lose the allowance entirely, including Boston, Massachusetts and San Luis Obispo, San Bernardino, Humboldt County, Riverside and Bridgeport in California. 

Military housing areas with the largest decrease include New York City, falling from 8% to 4%. 

Meanwhile, eight military housing areas will see an increase in COLA allowance. Seattle had the largest increase — from no COLA eligibility in 2025 to a 5% rate in 2026. Several other West Coast locations, including Oakland and San Francisco, Santa Clara County also saw notable increases. Staten Island, New York is also among the military housing areas with the highest Continental COLA rates.

Calculate your COLA rate here.

The Defense Department said CONUS COLA will cost about $99 million, benefiting roughly 127,000 service members nationwide in 2026 — significantly more than in 2025, when about 61,000 service members received a total of about $51 million in CONUS COLA payments. In 2024, only about 17,000 service members received the payment.

CONUS COLA is a taxable supplemental allowance, unlike most military benefits such as the basic allowance for housing and the basic allowance for subsistence, which are tax-exempt. The allowance is intended to help offset the cost of goods and services for service members stationed in high-cost areas. Just like basic allowance for housing, it is a monthly stipend, and it is different from cost-of-living adjustments for retirement pay and veterans’ benefits. It is also different from Outside Continental United States (OCONUS) COLA, which is non-taxable and changes every month to adjust for fluctuations in exchange between foreign currencies and the U.S. dollar. CONUS COLA only changes annually.

To qualify for CONUS COLA, a location’s non-housing living costs must be at least 7% higher than the national average.

CONUS COLA payments vary based on a service member’s duty location, rank, years of service and dependent status.

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