2026 marks a critical turning point for cybersecurity leaders as AI-driven threats, data sovereignty mandates, and hybrid infrastructure risks reshape the CISO agenda. Discover the strategic priorities that will define tomorrow’s security posture.

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Defense technology companies broadly agree on what secure software looks like. Less consistent, though, is industry-wide understanding of the Defense Department’s mechanisms for demonstrating security compliance. Instead, stakeholders generally see a lack of “consistent and standardized methods for attestation processes,” according to recent industry feedback.

A new summary document released by Acting DoD CIO Katie Arrington compiled and analyzed industry responses to three separate DoD requests for information on advancing and securing software for the federal government.

“Overall, there was a strong call for the DoW to define a legitimate attestation, identify what is required to complete an attestation, and to ensure consistency of these standards across the DoW,” the document states. “Additional hurdles such as resource constraints, difficulties managing supply chain opacity, and cultural barriers further underscore the intricacies of enforcing a robust secure software development practice.”

In response to the DoD CIO’s requests for information under the office’s recently launched Software Fast Track Initiative, industry overwhelmingly pointed to established cybersecurity frameworks such as the National Institute of Standards and Technology’s Secure Software Development Framework and the widely used Open Worldwide Application Security Project standards for managing software and supply-chain risk. More than 75% of respondents said they rely on NIST’s secure software framework, which aligns with DoD’s approach to software security and risk management.

But companies told Pentagon IT leadership that uncertainty around compliance remains a major obstacle. Vendors said it is unclear what qualifies as a valid attestation, what documentation must be included in a body of evidence, how often attestations are required and whether companies are allowed to self-attest to security practices or must rely on third-party assessments. Since NIST’s secure software guidance is designed as a framework rather than a checklist, vendors warned that compliance is open to interpretation and risks inconsistent application across the department.

Arrington announced the Software Fast Track, or SWFT Initiative, in April with the aim to reform the ways DoD buys, tests and authorizes secure software. Arrington has argued that the Pentagon’s existing processes for approving software are too slow. Since returning to the Pentagon in March in acting CIO capacity, she has pushed to overhaul the department’s legacy processes for buying software, namely the Risk Management Framework (RMF) and the authority to operate (ATO) approval process. She previously said she is “blowing up the RMF” and that she hopes ATOs are “something I never hear about again.”

The SWFT effort intends to shift away from rigid checklist processes toward dynamic, continuous authorization to operate. To inform the shift, the CIO office issued three requests for information asking vendors for insights around tools in use, external assessment methodologies, and how automation and artificial intelligence could help the department accelerate secure software adoption.

Not only did the first RFI, focused on Software Fast Track tools, reveal that companies are concerned about inconsistent attestation requirements, responses also flagged challenges with integrating the secure software framework into existing workflows. 

“The amount of evidence required for NIST SP 800-218 compliance would likely require automation and integration of multiple tools within existing infrastructure. Similarly, integrating manual documentation and effort into existing logical processes and workflows could be challenging,” the Software Fast Track RFI summary reads. 

At the same time, about 90% of respondents said they would provide software bills of materials — detailed inventories of the components used to build a software product — to the department. Most said those SBOMs would cover their own software.

Nearly all companies said they already perform software risk assessments and would provide DoD officials with risk assessments artifacts. Most said those artifacts are generated through automated tools, and the majority made clear “their willingness to provide these artifacts in an efficient manner through standardized formats and secure exchange processes.”

To that end, companies recommended allowing vendors to submit artifacts directly into DoD platforms such as Enterprise Mission Assurance Support Service (eMASS) through application programming interfaces to expedite software security reviews.

External assessments

Industry respondents said most companies already rely on a mix of internal and external audits to assess software security.

Internal audit functions typically include continuous monitoring, code reviews and regular red-teaming exercises designed to identify vulnerabilities before they can be exploited. Meanwhile, external assessments are often conducted by third-party auditors or independent penetration testers to provide objective validation of a company’s security posture. 

Top compliance regimes include the Federal Risk and Authorization Management Program, NIST cybersecurity standards and Service Organization Control (SOC), which “further evidences a mature security posture among organizations.”

At the same time, companies stressed that any external assessment functions would require clear guardrails. Respondents said assessment organizations should demonstrate relevant experience in high-security environments, secure data handling methodologies, established quality management and high degree of independence. Moreover, such assessments should be conducted by qualified personnel with industry-recognized certifications and a strong understanding of DoD security frameworks.

Applying automation and AI tools

Industry respondents said automation and artificial intelligence could deliver the biggest gains in speeding DoD software risk assessments, particularly by reducing manual paperwork and enabling continuous monitoring. Companies emphasized that automation and AI serve different purposes, with automation best suited for executing repetitive, rule-based tasks, while AI can “make decisions and learn to perform tasks with a human-like intelligence.”

Companies also warned about significant challenges in applying automation and AI. Vendors cited concerns around AI explainability, data quality and model reliability, noting that authorizing officials must be able to understand how risk determinations are made. 

Arrington said the Software Fast Track Initiative is on track to roll out early next year.

“People that think SWFT wouldn’t happen — joke’s on you. If it wasn’t for the furlough, that would have gone live in the beginning in November. So look in early January,” Arrington said during the Defense Information Systems Agency’s annual Forecast to Industry event on Dec. 8. “Software Fast Track: so you can ingest software and we can get it approved in days, not months and years. Making sure that we have a baseline called eMASS that can make sure that if an ATO is granted, then an ATO is reciprocated. We have the Software Assurance playbook. If anybody doesn’t know about that one, it’s when software has vulnerabilities. We work through them to remediate them, blowing up the RMF. We’re already starting to do it using continuous monitoring, the ten tenants of what it needs to be.”

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Interview transcript:

 

Terry Gerton GAO has put out a new report looking at the Coast Guard’s Offshore Patrol Cutters program. In fact, they got an additional $4 billion for this program in the One Big Beautiful Bill Act from last summer. Let me ask you to start by telling us what is this program, what are these ships, and why is it such a high priority for the Coast Guard right now?

Shelby Oakley These ships are a very high priority for the Coast Guard because they’re a workhorse. They’re intended to provide and do a variety of missions like search and rescue, and migrant interdiction, drug missions as well. And so you might imagine that makes up a significant chunk of the Coast Guard’s mission areas. And they’re intended to replace a class of ships called the medium-endurance cutters. And those medium-endurance cutters are really old, and they’re having a lot of challenges. They had a design life of 30 years and they are all well past that 30-year design life. So the gap between those medium-endurance cutters and the Offshore Patrol Cutters is getting bigger.

Terry Gerton So what prompted you to look at the program now? Is it just the size of it or the duration?

Shelby Oakley Given that it is one of the Coast Guard’s highest-priority programs, between it and the Polar Security Cutter, makes up a significant chunk of the Coast Guard’s acquisition budget. And so we really try and focus our reviews on the highest-priority acquisitions within the Coast Guard. And this certainly qualifies for it. But this isn’t the first time we’ve looked at this program. This is our third review of the Offshore Patrol Cutter over the past 10 years, and we also assess it every year in our DHS assessment of major programs. So we’ve had our finger on the pulse of this program for a while and have consistently been watching progress and challenges that it has experienced. This was a good time to take another look at the program because of where they are at in terms of construction and progress in that regard.

Terry Gerton So was third time the charm? Are they making progress or did you find some still serious systemic problems?

Shelby Oakley The program is divided into various stages, and that occurred because the original program was awarded to Eastern Shipbuilding Group. They experienced a devastating hurricane in 2018 that basically trashed all their facilities and really affected their ability to make progress on this program. At that point, the Coast Guard divided the program into stages. So, Eastern Shipbuilding Group kept the first four ships; that’s Stage 1. Austal was then awarded the next 10 ships; that’s Stage 2. And then there’s Stage 3, which is yet to be awarded. That gets you to the 25 ships. So Eastern Shipbuilding Group has remained extremely challenged in constructing the first four ships. And in the spring, the Coast Guard decided that they were going to basically cut bait on ships three and four from Eastern Shipbuilding Group. They terminated those for default. More recently, and basically the week we were issuing our report, Eastern Shipbuilding Group announced that it would no longer work on ships one and two. And so those first four ships are now sitting there at Eastern Shipbuilding Group in various stages of completion, anywhere from 6% to 75%, with big question marks around what’s going to happen with them going forward.

Terry Gerton I’m speaking with Shelby Oakley. She’s a director in GAO’s Contracting and National Security Acquisitions team. Shelby, that seems like a big sunk cost to just walk away from. What did your findings tell you about how Coast Guard has managed the design of these ships and the cost of these ships?

Shelby Oakley We have we have pointed out for years, and reiterated again in this report, about a number of decisions that the Coast Guard made that led to some of these outcomes. One of the biggest things that we have pointed to is that Eastern Shipbuilding and now Austal have been authorized to begin construction on these ships before the design of them is even complete. So imagine that, for your listeners: Let’s just say you’re building a house, and you’re designing this house and you’re trying to lay out where everything in the house is going to go. The plumbing and the bathrooms and the kitchen and everything. And the builder comes to you and says, you know what, we don’t need to know any of that stuff. We’re just going to start building. It always comes back to bite you. And that’s what happened with Eastern Shipbuilding Group. It led to a lot of rework where progress was made, construction was done, but then the design changed or matured, and you realize, oh shoot we need to route those pipes somewhere different. That amount of rework that happened really ends up adding a lot of time and money to the effort. And that’s exactly what we saw. We saw an increase overall for this program, a 57% cost increase in this program from initial baselines. OPC-1’s delivery, that’s the first ship built by Eastern Shipbuilding Group, was delayed by five years. So certainly those are some of the challenges that we’ve raised. And we’ve raised concerns about the Coast Guard’s oversight of this program as well too, both from the perspective of those decisions allowing design to progress, but also from a cost perspective. There’s a lot of questions about the fidelity of the cost estimates and the schedule estimates in this program that I think have come to bear, in terms of them being outdated before or right after they’re initially re-baselined. And so we’ve made some recommendations to the Coast Guard to improve things like their schedule estimates to bring more fidelity and oversight to the cost estimates for the program. For example, by estimating cost per ship versus for the overall program. A number of things over the years we’ve recommended for them to do and they’ve taken some action, but not in every case.

Terry Gerton Is this a problem that’s unique to the Coast Guard? I mean, the Navy buys and builds ships all the time. Does the Coast Guard or the Department of Homeland Security not have that same sort of institutional knowledge here?

Shelby Oakley So there’s a couple of things, I think, that I would call your attention to. The Navy has its own challenges and certainly, for your listeners, with the announcement a couple weeks ago about the cancelation of the frigate program for the Navy, where they’ve spent $4 billion trying to design a ship and construct a ship. And now they’re going to walk away from it. It’s kind of indicative of the overall status of shipbuilding in this country, that it’s extremely challenged. And part of the reason why shipbuilding is challenged in this country is because of workforce and facilities. We had years of declining shipbuilding in this county that led to declining workforces. The people to be able to do the welding, and the design efforts on these ships, are no longer around. Both the Navy and the Coast Guard are working to rebuild that. I would say, secondly, the Coast Guard doesn’t always get the tier one shipyards that the Navy does to build its ships. For example, with ESG, this award for OPC was its first government contract. Imagine trying to figure out how to work within government bureaucracy to build your ship when you’re used to your commercial business where it’s a lot different. That was definitely a challenge for Eastern as it made its transition to this program. I think that led to a lot of issues on the program.

Terry Gerton Well, looking ahead as the Coast Guard moves to hopefully Stage 2 and then Stage 3, what is the most important of your recommendations that you hope they get a handle on quickly?

Shelby Oakley The bottom line recommendation that we’ve been reiterating for a number of years is: Get that design stable before you start constructing any more ships. You don’t have the time or the resources to waste reconstructing things because the designs change. One of our recommendations on Stage 2 was don’t authorize Austal to build any more ships until they’ve completed their design. And so that’s a big one. But then I think another really important recommendation that we made is this Stage 3 award is looming. They have to award the remaining 10 ships. And our contention is, maybe you should operationally test the ships that you’ve built and make sure they do the things that you want them to do before you authorize a whole other set of 10 to be constructed. We really focused on trying to push the Coast Guard to get that type of knowledge before they issue that RFP for that third stage. We also hope at that time that they can incorporate more of our leading practices that we see commercial companies do, like adhering pretty strictly to the existing design and not making changes, and really ensuring that everything’s modeled in this 3D model that allows for real-time work between the Coast Guard and the builder to understand the effects of any design changes on it. And a number of other things in terms of those leading practices. But those two things I think would really help the Coast Guard ensure that they put this program back on better footing.

Terry Gerton And have the Coast Guard and Department of Homeland Security been positive in their response?

Shelby Oakley They were positive in the response about the Stage 3 recommendation in terms of incorporating knowledge before. We’ll see if they actually adhere to that. They did not concur with the stabilizing the design for Stage 2 before authorizing additional ships. I think they feel confident enough in the design to feel like they’re good to go. But we’ve seen this story play out before both within the Coast Guard and the Navy where that confidence can be overstated sometimes, and so we’re hoping that they really take that one to heart.

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Skana Robotics built a decision-making algorithm that helps unmanned vessels react and adapt to data from other vessels.

Lawmakers dropped several incentive pay and quality-of-life reforms for service members and their families from compromise defense policy legislation, including a proposal to expand eligibility for the basic needs allowance by removing basic allowance for housing from income calculations.

Congress first authorized the basic needs allowance in the 2022 National Defense Authorization Bill to address food insecurity among military families. But almost immediately, advocates and lawmakers flagged the program’s major flaw – many lower-income service members didn’t qualify for the stipend due to the inclusion of the basic allowance for housing in income calculations, pushing many families above the program’s eligibility threshold. 

The program had a low participation rate from the start — DoD estimated that there would be about 2,500 people eligible to receive the stipend at a cost of roughly $10 million. Meanwhile, the Pentagon’s own 2023 survey estimated that about one in four service members — or approximately 286,000 troops — struggled with food insecurity. 

The fiscal 2025 defense policy bill proposed expanding eligibility for the basic needs allowance by raising the eligibility threshold from 150% of the poverty line to 200% and excluding basic housing allowance from the calculation of gross household income. While Congress adopted the higher poverty threshold provision, lawmakers dropped the basic housing allowance proposal from the final bill.

The Congressional Budget Office estimated that the two proposals combined would have expanded BNA eligibility to 61,000 service members and cost the department $260 million in 2025 and $1.4 billion over the 2025-2029 period. 

The Biden administration said at the time that excluding basic housing allowance would “result in a much less targeted expansion of payments and come at a cost of $2.8 billion in FY 2025 that is not provided.”

The House tried to reform the basic needs allowance once again in the 2026 defense policy bill, but the proposal was ultimately stripped from the measure.

In the joint explanatory statement, lawmakers said that “quality of life measures, including increases in allowances, are addressed elsewhere in this Act.”

Lawmakers also rejected a Senate-backed pilot program proposal to provide coupons to junior enlisted service members to purchase food at commissaries. Members of Congress said the Defense Department already maintains “multiple, comprehensive food-security initiatives across the enterprise,” including a department-wide working group and congressionally mandated data collection and reporting requirements.

“These efforts collectively provide a robust framework for assessing and addressing food insecurity among servicemembers and their families, as well as existing annual reporting to Congress,” the lawmakers said. 

Also omitted is a House proposal to permanently expand the Pentagon’s authority to temporarily adjust housing allowance rates in high-cost areas. While Congress has given the department temporary authority to raise basic allowance for housing in places where costs jump by more than 20% in a single year, the authority is too limited to allow DoD to respond to rapid and frequent housing cost increases in many military communities. 

The bill would have lowered the threshold for mid-year temporary BHA increases from 20% to 15% of the overall increase in cost of living from the previous year.

Incentive pay provisions dropped

The House version of the defense policy bill sought to establish a five-year pilot program to assess whether offering incentive pay to enlisted service members with college degrees related to their military specialties would improve retention. Under the program, the department would have paid monthly incentives to enlisted service members with less than four years of service who hold a degree in their military specialty and are committed to reenlisting. 

While the Senate version of the bill contained a similar provision, both proposals were dropped from the final measure.

“We note that the military departments possess broad authorities…to provide special and incentive pays to meet service-specific personnel needs. These authorities enable the military departments to recognize critical skills or qualifications, including academic expertise where appropriate,” the lawmakers said in the joint explanatory statement.

The House also tried to overhaul cyber assignment incentive pay by requiring a standardized, department-wide framework. The proposal would have defined uniform eligibility criteria, established a tiered pay structure based on proficiency levels, ensured pay parity across services and protected incentive pay during permanent change of station moves. The provision was ultimately dropped from the bill.

Reimbursement for specialty care travel expenses

A House-backed proposal sought to increase access to specialty care by lowering the threshold for travel reimbursement for medical appointments from 100 miles to 50 miles. The final version of the bill, however, adopted a 75-mile threshold.

The Senate cleared a key procedural hurdle on Monday, moving the must-pass bill closer to final passage.

The post Lawmakers drop several quality-of-life reforms from final defense policy bill first appeared on Federal News Network.

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• The Pentagon inspector general found the Army and Navy miscalculated the number of low-scoring recruits entering the military through their preparatory programs. The watchdog found the services used recruits’ improved test scores instead of the scores they had when they first signed up. As a result, both services exceeded the legal limits of recruits with low test scores entering the program. The courses are designed to help recruits meet academic and physical standards before starting basic training. The services also failed to notify the Secretary of Defense and Congress that they had exceeded that limit, as required by law.
  (Army, Navy exceeded legal limits of low-scoring recruits in future prep courses - Defense Department IG)
• The Department of Homeland Security has named a leader to oversee projects under the One Big Beautiful Bill Act. Jaclyn Rubino is now serving as executive director of the newly created OB3 Principal Executive Office. Rubino was previously executive director of DHS’s Strategic Programs Division. The One Big Beautiful Bill Act provides DHS with approximately $190 billion through 2029. Most of the spending is concentrated on immigration enforcement and border security.
  (OB3 announcement - LinkedIn)
• Senate Democrats say they’re concerned about a stricter reasonable accommodation policy at the Department of Health and Human Services. The HHS reasonable accommodation policy requires an assistant secretary at the department to approve all telework, remote work or reassignment requests. The new policy said telework should not be granted as an interim accommodation. Sens. Tim Kaine (D-Va.) and Raphael Warnock (D-Ga.) are leading colleagues in a letter against these changes. They say they’ve heard from federal employees who have been harmed by these decisions.
  (Letter to HHS Secretary Kennedy - Sen. Tim Kaine (D-Va.))
• The number of protests filed with GAO are down for a second straight year. Vendors filed 1,617 bid protests with the Government Accountability Office in fiscal 2025. That is a 7% decrease over the amount filed in 2024 and 17% fewer than in 2023. GAO's annual bid protest report to Congress released yesterday shows only 380 cases resulted in a decision, of which 53 were sustained. The most common reason for a sustained protest was unreasonable technical evaluation, followed by unreasonable cost or price evaluation, and then unreasonable rejection of proposals. The effectiveness rate, which shows the percentage of cases where the protestor received some sort of relief, remained at its traditional level of 52%. GAO also said it reviewed and closed 359 cases under its task and delivery order jurisdiction.
  (GAO sees decrease in number of protests filed in 2025 - Government Accountability Office)
• Veterans Affairs is launching a long-awaited reorganization of its health care operations. VA said the changes aren’t expected to result in a significant change in overall staffing levels. Internal documents earlier this year showed the VA is looking to put limits on how many currently vacant positions it will fill. VA said it’s briefed lawmakers on the reorganization. Implementation will take place over the next two years.
  (VA launches Veterans Health Administration reorganization - Department of Veterans Affairs)
• A bipartisan bill in the Senate would have the Commerce Department play a lead role in securing satellites from cyber threats. The Satellite Cybersecurity Act introduced last week would require Commerce to develop voluntary cybersecurity recommendations tailored to commercial satellites. It would also require the agency to create an online clearinghouse of cybersecurity best practices and other information that helps companies secure their systems. The bill was introduced by Homeland Security and Governmental Affairs Committee Ranking Member Gary Peters (D-Mich.) and Sen. John Cornyn (R-Texas).
  (Peters & Cornyn reintroduce legislation to protect commercial satellites from cybersecurity threats - Senate Homeland Security and Governmental Affairs Committee)
• Appeals court judges scrutinize Trump’s national security basis for collective bargaining rollback. The US. Court of Appeals for the District of Columbia is weighing what limits, if any, exist for President Donald Trump to classify which agencies are essential to national security, while rolling back collective bargaining rights in the process. Trump signed an executive order exempting many agencies from collective bargaining on the grounds that their mission is primarily based in national security. A Justice Department attorney representing the Trump administration said the president is the “expert” on which agencies meet this classification. But some members of a three-judge panel suggested the president’s designation is overly broad.
  (Appeals court judges scrutinize Trump’s national security basis for collective bargaining rollback - Federal News Network)
• For the second straight year, the House passed a bill to bring more rigor to how agencies oversee software licenses. And for the second straight year, it's unclear if the Senate will do the same. Under the Strengthening Agency Management and Oversight of Software Assets Act, agencies would have to create a software inventory and undergo an independent assessment of software license management practices and contracts. Lawmakers unanimously approved the bipartisan legislation yesterday. OMB would have to publish a governmentwide strategy for software modernization based on those audits.
  (House passes SAMOSA bill for second year in a row - Rep. Shontel Brown (D-Ohio))
• The Defense Logistics Agency has launched a new major subordinate command aimed at improving how the military gets spare and repair parts. The command, known as DLA Weapons Support, merges the missions of DLA Aviation and DLA Land and Maritime into a single, unified organization. Agency leaders say the move is designed to standardize processes, reduce duplication and deliver faster, more cost-effective support to warfighters across the joint force. The new command will operate out of existing sites in Ohio and Virginia and the transition will continue over the next year.
  (DLA launches new weapons support command - DLA.mil)

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Labeling adversary activity with ATT&CK techniques is a tried-and-true method for classifying behavior. But it rarely tells defenders how those behaviors are executed in real environments.

The post Extracting the How: Scaling Adversary Procedures Intelligence with AI appeared first on Security Boulevard.

A group of lawmakers found the Pentagon has diverted at least $2 billion intended for barracks repairs, school upgrades for children of service members and training programs to support the southern border mission.

In a report released last week, Democratic members of Congress say the Pentagon redirected funding from a range of military construction and infrastructure projects to support immigration operations, including elementary schools at Fort Knox, a medical and dental facility at Naval Air Station Whidbey Island in Washington, Marine Corps barracks in Japan and a jet-training facility in Mississippi. 

Funds originally allocated for the now-cancelled jet-training facility at Columbus Air Force Base and overseas barracks were reprogrammed to construct roughly 20 miles of border wall. In total, about $1 billion was shifted from barracks repairs to support border operations. 

The report, based on the Pentagon’s reprogramming requests to Congress and open source information, is the first comprehensive account to date of the known costs associated with using the military for immigration operations.             

In addition to the cost breakdown associated with providing military support to immigration enforcement, the lawmakers warned that military readiness “will suffer as a direct result of diverting” DoD resources for immigration enforcement, arguing that the role is “not consistent with DoD’s mission and that service members have neither signed up nor been trained for.”

For instance, the 10th Mountain Division had recently been trained and certified to conduct large-scale combat operations in a multi-domain operational environment, but hundreds of its soldiers were deployed to the southern border in early 2025, where the division assumed control of the mission. The Army later rotated in the 101st Airborne Division — the service’s only air assault division — to replace the 10th Mountain Division at the border. 

“Instead of standing ready for true national security missions, deployment-ready units are being sent to Texas and other states to control the U.S. southern border in support of [U.S. Customs and Border Protection],” the lawmakers said.

Some of those costs are also intangible, the lawmakers argue. During peak fire season, for example, the California National Guard’s firefighting unit was understaffed due to nearly half its members being deployed to Los Angeles to “protect [ICE] in the execution of their duties,” according to Defense Secretary Pete Hegseth.

The lawmakers say it is unclear whether the Pentagon has assessed the impacts of shifting these funds and resources on the department’s readiness. The Pentagon did not respond to a request for comment on whether such an analysis has ever been conducted.

The cost of military involvement in immigration enforcement

President Donald Trump has pushed to expand the military’s role in immigration enforcement since taking office, including by deploying National Guard and active-duty troops to the southern border and U.S. cities; transferring federal land along the border to DoD control; conducting military deportation flights; permitting the detention of noncitizens on military installations within the U.S. and overseas; and allowing military lawyers to serve as immigration judges.

The lawmakers found that approximately $1.3 billion — the largest share of the diverted funds — was used to pay for the deployment of troops to the southern border. 

“Many of these troops at the border may be doing little more than ‘standing around.’ Yet their presence has not been cheap: earlier this year, DoD’s own data showed it was spending an estimated $5.3 million per day on its border operations,” the lawmakers said. 

More than $420 million was redirected to support immigration detention operations on U.S. military installations and at overseas bases, including Guantánamo Bay in Cuba and Camp Lemonnier in Djibouti.

The Trump administration began detaining noncitizens at Fort Bliss, an Army post in Texas, in August. By September, the department had spent more than $363 million to support the Fort Bliss Montana Avenue facility in El Paso and a related Customs and Border Protection processing center. The facility initially opened with about 1,000 beds, with plans to expand its capacity to 5,000 by 2027 at an estimated cost of up to $1.2 billion. ICE’s detention oversight unit found the unfinished facility was already in violation of at least 60 federal immigrant detention standards, according to the report.

The lawmakers also found that the department diverted at least $40.3 million to pay for military flights used to deport noncitizens, which are a lot more costly to operate than civilian aircraft. While it costs $28,500 an hour to fly a C-17, which was used to conduct deportation flights, a flight contracted by the Department of Homeland Security costs $8,500 an hour. 

By the end of September, the Trump administration had conducted at least 88 deportation stops along 63 flight routes using military aircraft.

“Before this administration, military aircraft appear to have never been used for deportations,” the lawmakers said. 

In addition, the report found that domestic deployments of National Guard and active-duty troops to Los Angeles; Portland, Oregon; Memphis, Tennessee; and Chicago cost at least $258 million.

“As the number of mobilizations grows, so will the financial costs of paying, transporting, housing, feeding, and equipping troops — as well as the mounting personal costs to the individuals who serve in their state National Guards, and to their families. These servicemembers are being pulled from their homes, families, and civilian jobs for indefinite periods of time to support legally questionable political stunts,” the lawmakers said.

Hegseth also approved a plan to detail up to 600 military lawyers to the Justice Department as temporary immigration judges earlier this year — an effort aimed at easing a backlog of roughly 3.5 million cases that has grown in recent years.

While the Office of Legal Counsel issued an opinion advising the Justice Department to reimburse the Defense Department for military lawyers serving as temporary immigration judges, it is unclear whether DoJ has begun the process.

The lawmakers said the information obtained for this report “confirms that the vast majority of these DoD funds have not been reimbursed to date — even though DHS recently received an unprecedented influx of $170 billion, giving ICE a budget bigger than any other law enforcement agency in the United States and bigger than many countries’ militaries.”

“Allowing DHS to continue to pick DoD’s pockets puts our military readiness at risk,” the lawmakers said.

While the fiscal 2026 defense policy bill fully funds deployments of National Guard and active-duty troops to support the southwest border mission, the Defense Department is forced to divert funding from other military accounts in the meantime. The defense policy bill also fully funds the establishment and enforcement of National Defense Areas along the southwest border and authorizes the department to provide additional support to CBP through the use of private contractors.

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© AP Photo/Jacquelyn Martin

Interview transcript

Terry Gerton Hottest topic I think is the NDAA on the Hill. It passed the House. What’s going on next?

Mitchell Miller Well, it’s going to the Senate and there are a few little tripwires in the overall, more than 3,000-page bill, but I think it is on its way to getting passed. This is something, as you well know, that is always passed every year for more than six decades, which is pretty rare in this sharply divided Congress. So there’s, you know, a lot of support for it broadly. I think obviously the 3.8 percent pay increase for military personnel. A lot of talk among the leadership related to acquisition and the reforms that are taking place related to that, that a lot of these weapon systems, basically there’s a concern among lawmakers that the Pentagon can’t obviously, you know — the metaphor is you can’t turn around an aircraft carrier very quickly. And similarly with acquisition, you can’t just adjust something super fast, but they have put in a lot of reforms that the lawmakers at least believe will allow the Pentagon to quickly react and create new weapon systems on a faster glide path than they currently are now.

Terry Gerton As people have been making their way through the 3,000 pages in the conference bill, there’s been some surprise about provisions that folks thought were home runs and got dropped as the bill went through conference.

Mitchell Miller Right, and one of them is the right to repair provision, which of course would allow people to basically, within units of the defense department, to fix their own equipment, which sounds pretty basic, but it would provide a lot of additional resources to do that. And everybody thought that was going to go through pretty easily, but for whatever reason it was pulled, and I think that has sent some shock waves through the contracting world as to why that is going to happen. I think that as we move into the next year we will probably see that looked at again. Certainly some things have been pulled or changed over the course of this whole NDAA process. And one of the side notes that came up this past week was the fact that they would basically allow for the Army to continue its helicopter flights near Reagan National Airport as they used to. They of course have been limited since that accident, terrible accident in January that killed 67 people in a midair collision involving an Army helicopter and a commercial jet liner. And there was a lot of furor last week among lawmakers related to — including this language that essentially says that the Army gets a buy on putting in the new communications systems that would allow for helicopters to be quickly identified, more quickly identified than on radar and that they could essentially potentially go back to the status quo. So I talked to Senator Mark Warner (D-Va.) and he says he’s going to reach out to the Pentagon to try to see if they can get that changed. But I don’t think these issues will jeopardize the overall NDAA. I think we can see that it will be passed this week.

Terry Gerton Well that will be progress at least to have one of those bills through, even with some of these outstanding issues. The other funding issue that’s certainly top of mind is whether or not we’re going to get a repeal on the ACA extensions. It failed in the Senate. Where does it go next?

Mitchell Miller Well, this is really interesting because, you know, during the whole debate over the government shutdown, they said, oh, we have plenty of time. We can deal with this later. It doesn’t happen until the end of the year, the subsidies going away from the ACA. Well, here we are. And we have not really gotten through any kind of progress. The Senate, as you mentioned, voted down two proposals, dueling proposals. One, the Democrats wanted to extend the ACA subsidies for three years. The Republicans came up with an alternative plan related to health savings accounts, which they say would provide more control for Americans over their own health care costs. And variations of those two themes are now being sorted out in the House. A lot of House moderates on the Republican side, frankly, are concerned that it’s going to look bad politically heading into the midterms if they don’t do anything related to this issue. So you have a really unique situation where this is such a big issue that you have people trying to essentially do an end run with discharge petitions in the House for the Republican leadership. Various proposals extending the ACA possibly two years with caps on how much people can make, various requirements related to cutting out fraud. So it’s going to be fascinating to see how all this unravels this week in the House. My personal thinking is that they are not going to get anything actually passed this week. And then we are going to, of course, head into the new year where you’re going to have more than 20 million people under those ACA provisions who will be seeing those soaring costs related to their health care premiums. So it’s pretty fascinating that Congress just was not able to do this, at least to this point.

Terry Gerton Mitchell Miller is Capitol Hill correspondent for WTOP. Mitchell, around that ACA issue, there was so much bad blood and mistrust throughout the shutdown. How is that impacting what’s got to happen next, which is appropriations bills?

Mitchell Miller You know, it’s really left a bad feeling on both sides, I think. And unfortunately that has impacted this whole appropriations process. You know, all year long we heard nothing but talk about, we want to get back to regular order. We’re going to pass all of these 12 bills. Well, here we are in December, and we only have three bills that have been passed in terms of those overall appropriations. So the thinking is, among several lawmakers including Senator Tim Kane (D-Va.), who I spoke to recently, is that maybe they can chip away, maybe they can find some more and put them in an omnibus. They were talking about possibly doing an omnibus before they take their break, but that is simply not going to happen. So now they’re looking at maybe January to potentially get another minibus, if you will, maybe get four or five of these major legislative packages through that way. But then we’re staring down the barrels once again of Jan. 30, the shutdown showdown. And I’ve talked to some lawmakers about that, and they said, yep, it’s going to be here before we know it. So they’re hoping at least to get some goodwill back in the appropriations process as they chip away, as I said, related to these other measures. On the other side, I will say that the House speaker, Mike Johnson (R-La.), was very happy to make the point recently that they will not have the overall huge omnibus that, as you know, they often have right before Christmas or right during the holidays where they have to get everything done. This has been something that the Republicans have been really pushing back on. They don’t want one of those big deals and they’re not going to get it because everything got pushed into 2026.

Terry Gerton Well, it sounds like some lawmakers might be getting coal in their Christmas stockings.

Mitchell Miller I think there will be a lot of coal in Christmas stockings this year.

Terry Gerton Mitchell, one of the other topics that comes to mind when you mention regular order is congressional oversight hearings. And there was a move towards oversight, especially regarding the boat strikes over the last week or so. What are you seeing there?

Mitchell Miller Well, I think it’s an interesting tale of two cities, if you will, or tale of two chambers. On the House side, you’ve got a lot of review that has been taking place within the House Armed Services Committee, but the chairman, Mike Rogers, essentially said he is satisfied with what he has seen related to the video of that so called ‘two tap’ strike. And then on the other side, on the Senate side, Roger Wicker (R-MS), the Republican chair of the Senate Armed Services Committee says, Well, I wanna see a little bit more. I wanna get all the lawmakers on the committee to actually see the whole video. So it’s interesting to see that little mini divide within the Republican Party. And then of course you have Democrats who are really calling for a lot more oversight, saying they have to look into this more, and of course that was exacerbated even more by the seizure of the tanker related to Venezuela. So there is a move, I think, among lawmakers to reassert some of the powers of the legislative branch, but we’ll have to see how much that moves forward.

Terry Gerton Well the judicial branch got involved last week as well. There was a Supreme Court hearing on Monday about whether or not Trump’s firing of an FTC commissioner was constitutional. And that has a lot of impact potentially for independent agencies. Any response there?

Mitchell Miller Yeah, there’s a lot of concern about it because it seems like, at least, particularly on the Democratic side, they feel that all of these independent panels are just slowly being taken away by various executive orders, and in this case in the Supreme Court order — decision. And there is a feeling that if this is allowed to continue, there really won’t be any more independent panels, that it will go back essentially to the spoil system that used to take place many years ago and they tried to wipe away all of this so that the politics didn’t get involved with all these panels and commissions and committees. And that’s why there is so much at stake to jump to the midterm elections, because right now there really isn’t going to be much oversight related to this on the Republican side. They feel like the president has the power, he is going to do what he wants. But if the House flips and goes to the Democrats, then I think you’re going to see a lot more oversight on issues just like this one, on issues like the one you spoke of related to the boat strikes. So that could really have a profound impact on what happens with Congress moving forward.

Terry Gerton Well, it doesn’t sound like we’ll get much of a break over the holiday season. There’s much to watch here as we go forward.

Mitchell Miller Lots of busy things happening here.

The post Defense, health care, oversight and spending; these four fronts are exposing deep divides on Capitol Hill first appeared on Federal News Network.

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Interview transcript

Terry Gerton You are involved with the National Electrical Manufacturers Association. We have heard a lot of talk about underemployment in the trades, the skilled trades, but NEMA makes the point that this kind of security, electrical security is like national security. Walk us through that argument and then we’ll talk about your specific programs.

Peter Ferrell NEMA — well, first let me introduce what NEMA is to your members. The Electrical Manufacturers Association represents about 300 or so companies, both large and small, that produce the equipment and components that go into many of other sectors throughout the economy, which include the energy sector, the defense industrial base, the water sector and others. Sectors that are really kind of, you know, on their own are important, but holistically really kind of make not just the economy function, but also our nation function holistically. And so our members from the grid side and the energy side make the components and the equipment that not only house — or excuse me — that power communities, that power warehouses, that power manufacturing facilities, but they also power defense applications from military bases and also provide the equipment for industrial military sector as well. So, you know, without those components, really there comes a gap for defense purposes and for energy purposes. And those two things of course are very interrelated. And so NEMA helps … Fill that gap with our manufacturers and the components and products they provide.

Terry Gerton What are the specific workforce challenges that you’re facing in the electrical manufacturing field?

Peter Ferrell So NEMA conducted a grid reliability study that was published at the start of this year. And it concluded that there were three main buckets of areas that were really driving energy demand. And this ties into your question, but for some context, with the growth of energy needs for remanufacturing purposes, for electrification purposes, for EV purposes, but also for AI and data center purposes, you know, there is this new demand for all of these products all of a sudden. And so, you know, to make those components, to make all of those things possible requires a very diverse and pretty skill-heavy workforce … And from a manufacturing perspective too, I want to just kind of emphasize it’s not just skills that involve, you know, folks’ hands in a factory — kind of that traditional old school way of looking at a manufacturing. A lot of manufacturing is automated, a lot of it’s connected systems … that require new age skills in terms of, you know, how do we scale manufacturing? And so the workforce needs in this area are very wide and very deep. And so we need folks that know how to wind coil, that can stack cores made out of electrical steel to make distribution transformers, a very kind of classic and traditional hands-on work, but we need folks that understand how to manage and operate industrial control systems, operational technologies, IT specialists, welders and other kind of more skilled, you would say, new age jobs. All of those things come together to form really what the modern manufacturing environment looks like. And so all of those jobs are very specialized and very unique, but really it’s kind of an all-of-the-above when it comes to the skill sets.

Terry Gerton And NEMA’s making the case that transitioning service members and veterans are an optimal target pool for you. Tell us about why you think that and what you’re doing to recruit them.

Peter Ferrell So right now NEMA is looking toward kind of implementing a program called, or pursuing a piece of legislation called, the Veterans Energy Transition Act or the Vets Act. And what it is is that it’s a piece of legislation, a bipartisan piece of legislation, that was introduced earlier this year by Representatives Jen Kiggins (R-Va.) And Chrissy Hoolihan (D-Pa.), both who are veterans themselves. And what it seeks to do is to really kind of bring the supply chain components of the energy supply chain to meet the workforce that veterans provide or that can provide. And so veterans have a lot of skills that they learn throughout their careers, especially lengthy careers, if they’ve been in for many decades. And so it’s a way of trying to, you know, seamlessly as possible, take the skill sets, whatever they may be, whether it’s in management, whether it’s in operations, whether it’s in logistics, just to name a few, and to bring those skills over to the energy sector to help meet the moment and fill the voids in those jobs and those many areas that I mentioned just a second ago. And so … We feel that veterans, of course, kind of play an important role and kind of have a really special element that they bring. They’re mission-driven, they’re team-driven. They look at things holistically ,but also, you know, in how they apply their skill sets. All of these things matter. And so for us, those kind of intangibles that kind of the military provides and, you know, develops and really instills — and not just workforce and values and things of that nature, but also in terms of how military service folks just view work, and kind of the meaning of work and why it’s important. We feel that that’s a very valuable intangible that, you know, when applied to the energy sector and to manufacturing, can really produce tremendous benefits, not just for the companies that hire them, but also for the communities that they’ll end up serving through the course of their work.

Terry Gerton I’m speaking with Peter Ferrell. He’s senior director of government relations at the National Electrical Manufacturers Association. We’ll come back to the legislation in a minute, but there are already a number of programs out there that have been put in place over the last couple of decades to support transitioning service members. There’s apprenticeships with unions in the industry you’re speaking of, right? Electrical apprenticeships and some of those. There’s Skillbridge, there’s transition programs from the veteran serving organizations and fellowships. Is NEMA engaged with those? And if you are, are they not working for you? Is that why you need legislation that proposes a new solution?

Peter Ferrell One of the organizations that NEMA is involved with is the Veterans Internship Providing Employment Readiness Program or the VIPER program. And … that program is focused mainly on trying to reduce suicides of folks that leave the military and then find themselves without the ability to kind of have any meaning in their life. And so really that program is meant to help marry up companies and folks who can employ veterans with those folks with those skill sets. So it’s a very complimentary kind of program to what the legislation is trying to do. But the legislation is proposed based on the folks at the Niskanen Center, which is a think tank here in Washington, D.C., identified not only that there was a workforce shortage to provide jobs in the energy sector, but that veterans provided really kind of this complimentary tool for it. But as you point out in your question, that there are many existing programs to help veterans prepare for the workforce. There’s the other side of that coin, which is how is it that we’re preparing companies to meet that workforce as they depart the service or, to help veterans who have already departed, or actually involve spouses in a way? So what this does is it’s an attempt to kind of incentivize and help companies meet veterans or transitioning folks where they are. Because it’s one thing to say, you know, a program has helped someone who’s transitioning out, learn how to build their resume, learn how to dress, learn how to conduct an interview, and then go to a job fair. But the question is, well, are the right jobs at that job fair? Where, you know, have there been incentives? Are they able to participate in those opportunities to meet those veterans? And so this bill would help kind of give the resources to especially small and medium-sized manufacturers that just make the right components and make the right pieces of equipment, but they just don’t have the budgets or the resources to really reach out to those members. This is really kind of, in a sense, helping, like I said, the other side of that coin — to help companies meet veterans where they are. And so, in a sense, [this] complements kind of the existing veterans transition programs like Skillbridge, like TAP, like Solid Start that are already on the books.

Terry Gerton In the interim then, while you’re working on the legislation with members of Congress, what do you want employers in this sector to know and what do you want transitioning service members and veterans to know? How can we bring them together while we’re waiting on the legislation?

Peter Ferrell Well again, there’s programs like the VIPER program, and to really kind of bang the drum around these issues and, you know, through great avenues through your program, for example, to let folks know that these things exist. I think … in some ways … there’s a lot of information out there and for a lot of folks it’s confusing. What do you listen to? You know, who are the best resources to rely on. And so really kind of emphasizing to not just employers, not just to manufacturers, but also to folks in this that do distribution and folks that are in the contracting world that, you know, there are a lot of companies that need this, that need this employment, that they’re good jobs, that they are, you know, in many ways, it’s the most American of things. It’s an American job that you’re getting, and they provide very well. And but there’s a need, and sometimes it’s a lack of just not knowing that these needs are out there. And so in the interim, getting the word out around the fact that the industry as a whole, from when a component is made, to how it gets delivered, to how it gets installed, all of those sectors need workers. But also that, you know, there’s 200,000 or so veterans that are leaving the service, retire for one reason or another about every single year. But, you know, according to statistics from VIPER, only about a quarter of those folks have jobs immediately after they leave the service. And so it’s, how do we ensure that folks are aware that there are willing participants that want to utilize the skills that have been developed over many years of service and to build upon those skills to, you know, help veterans or folks know that there is a place for a lot of those folks but making sure that they marry up and that one knows about the other and it’s making sure that that communication is out there.

The post A new bill could turn military experience into energy-sector strength first appeared on Federal News Network.

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For Jay B., the decision to opt into the Trump administration’s deferred resignation program (DRP) earlier this year was not an easy one.

Like many federal employees, Jay, who requested using an initialism of his name for fear of retaliation, spent decades in public service. But after working remotely for over 10 years, the administration’s return-to-office requirements meant he’d have to commute over 100 miles a day — a change that became a major factor in his decision to take the DRP in April and end his Forest Service career.

Governmentwide, the DRP let eligible employees sign a contract earlier this year, agreeing to quit their jobs in exchange for months of paid leave, until Sept. 30 for most. Over 154,000 employees took the offer, accounting for about half of this year’s federal workforce reductions.

But with 30 years of service, Jay, along with thousands of other DRP-takers, also qualified for the government’s Voluntary Early Retirement Authority (VERA). So in April, he applied for retirement.

“Thirty years of my life has been in the federal government,” he said. “So relying on VERA, along with the deferred resignation program, has been a little bit scary.”

Jay’s decision, however, would lead to months of uncertainty: After submitting his retirement application, HR lost some of his paperwork, causing him to be incorrectly marked as “ineligible” for VERA and delaying his application.

Jay emailed his agency’s HR office over 30 times in search of assistance. But because he lost access to his government computer after taking the DRP, emails from his personal account were marked as spam.

“It just felt like I was out on an island,” he said.

At the Forest Service, HR has processed 2,253 retirements, and 508 applications remain pending, according to an agency spokesperson.

HR staff are “committed to providing prompt, accurate and courteous service,” the spokesperson told Federal News Network.

Jay eventually managed to reach an HR specialist and have the error corrected, but only after weeks of stress and exhaustion. As his application began processing in the months that followed, he said he had limited communication with his assigned HR specialist. But knowing that the specialist was juggling more retirement applications than usual due to the DRP, he maintained that she “did a great job,” given a difficult situation.

“I believe that if I had not been in the DRP, that issue would have been resolved well before my retirement date,” he said. “Things are looking a little better now, but the process has just been really, really difficult.”

As one of tens of thousands of federal employees leaving their jobs, Jay’s experience is all too common. Though the government’s retirement process has been a pain point for years, 2025 is a particularly difficult time to retire, according to many benefits experts and former employees.

Federal News Network interviewed more than a dozen retiring employees at various points in the process, most of whom spoke on the condition of anonymity out of fear of retaliation. The individuals come from agencies including the IRS, Social Security Administration (SSA) and departments of Health and Human Services (HHS), Defense, Commerce and Justice.

Amid the application influx, the Office of Personnel Management has also rolled out a major effort this year to modernize the legacy federal retirement system, which has long been paper-based. Many experts see the launch of OPM’s online retirement application (ORA) as a long-awaited improvement, but some remain wary of the timing, as agencies face application volumes not seen in at least a decade.

Thiago Glieger, a federal retirement planning expert at RMG Advisors, described the converging changes as “uncharted waters” for OPM.

“OPM has not really handled this new [ORA] system before, and this many federal employees retiring all at the same time,” he told Federal News Network.

But Kimya Lee, OPM’s deputy associate director for Retirement Services, said having the ORA platform available this year has been crucial for managing both current and upcoming waves of retirement applications.

“A surge like this would be extremely difficult for our legacy processing to work — it just wasn’t built for something like this,” Lee said during a Dec. 9 Chief Human Capital Officers (CHCO) Council meeting. “Despite record high retirement volumes this year, ORA is performing well. This gives us confidence as we prepare for retirement activities in 2025 and into 2026.”

At the Forest Service, a spokesperson said ORA “streamlines submissions, reduces errors and shortens processing times,” and added that the agency’s HR specialists work directly with OPM to resolve processing issues.

Still, the surge of applications meant that Jay, like many others, waited months after his salary payments ended, before he received a payout of his lump-sum annual leave. The financial boost is usually delivered within a few pay periods, and often tides over retiring employees while they wait for their annuities.

“I’m still worried about how all this will go,” he said.

At the time of publication, Jay’s retirement application had still not made it to OPM.

Retirement processing times on the rise

OPM itself is already well above its typical retirement workload due to the DRP, and seeing slower processing times as a result. Later this month, the agency is anticipating a second wave of retirement applications, which will further flood the system.

In November, OPM took in nearly 23,400 retirement applications from agencies to begin processing them. And in October, OPM had a similarly high intake of over 20,300 applications. That’s more than triple OPM’s volumes from October and November 2024, when just about 13,700 applications entered the system.

All told, OPM’s inventory of retirement applications is now over 48,300, nearing four times the 13,000 applications the agency aims to have on hand at once, as it both manages incoming applications and processes existing ones.

In April, OPM estimated the entire process — from the day an employee submits an application, to the day the employee’s annuity is finalized — took between three to five months. OPM’s part of the process alone, at that time, took about a month and a half.

But the rising application volume has slowed the pace of processing. The average time it takes OPM to review an application, calculate benefits and finalize an annuity has continually increased for most of 2025. After peaking in October at an average of 79 days, nearly three months, OPM’s average processing time decreased to 73 days in November.

Processing times for digital retirement applications, however, are notably faster. OPM has been completing those applications in about 38 days, or just over a month. In November, OPM reported that about one-third of incoming applications were digital, and two-thirds were paper-based.

“Digital cases are moving more than twice as fast as paper cases, but we are expecting these numbers to decrease,” Lee said. “We have a surge of applications going on right now, but as the surge decreases, we also expect our digital case [processing times] to decrease substantially.”

At many agencies, the retirement process is relatively similar. Once an employee applies for retirement, the employee’s home agency first prepares the application and sends it to a payroll provider for processing.

After initial agency and payroll processing is complete, the retiring employee receives a lump-sum payout of their unused annual leave.

From there, the application goes to OPM for review and the calculation of a temporary “interim” annuity payment, usually between 60% and 80% of a retiree’s final annuity.

Lastly, retirees begin receiving their final annuity once OPM fully adjudicates their applications — a process that, under usual circumstances, takes several months.

Some outlier cases can take much longer. OPM has said court orders, special annuities, part-time or intermittent federal service, or even working at multiple different agencies, can all slow the process.

One federal employee who spoke to Federal News Network retired in June 2024 and is still waiting for her application to be fully adjudicated, despite receiving interim payments in the meantime.

But with this year’s massive wave of retirements, the retiree feared further delays in the finalization of her application.

“I just don’t want it to get lost in the system,” she said. “I feel like I have no control.”

OPM has received nearly 139,000 retirement applications so far this calendar year, and processed about 103,000. But the workload is expected to grow in the next few months. OPM is anticipating thousands more applications to enter its systems by the end of December.

With applications on track to surpass 140,000 this calendar year, OPM is facing the highest retirement volume in at least the last quarter-century — and possibly ever.

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DRP has swamped the federal retirement process

The flood of DRP retirees has added substantially to the government’s retirement application volume. Of the 35,000 total applications in ORA with a September retirement date, DRP employees represent about half — more than 17,500 applications.

In other words, September’s digital retirement volume is likely double what it would have been without the DRP.

Of all DRP applications currently pending, close to three-quarters, or about 12,650, have reached OPM, according to numbers OPM provided to Federal News Network.

Other retirement applications, however, are still with either agency HR offices or payroll providers, awaiting initial processing before they can be delivered to OPM.

Applications not yet with OPM may face longer wait times. The National Finance Center, for instance, estimates a current processing time between 60 and 90 days once receiving an application, according to emails viewed by Federal News Network.

Rob Shriver, a former acting director of OPM during the Biden administration, summed up the current experience as one of “incredible frustration” from DRP employees and others trying to separate from government service.

“HR was already understaffed — now lots have left, and they have an ever-increasing workload. It’s all going to create backlogs,” Shriver, currently managing director of the Civil Service Strong initiative at Democracy Forward, told Federal News Network.

As those thousands of retirees wait, the typical end-of-year retirement flood OPM is expecting will add to the workload, and as a result, likely delay the timeline for finalizing annuities.

“There’s no question — we have a very busy time now, and we’ll get another big surge in December,” OPM Director Scott Kupor said in an interview with Federal News Network. “We’re certainly cognizant and doing everything we can to anticipate and deal with the larger volume.”

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Retiring federal employees “in the dark”

Along with OPM, agency HR offices are also seeing slowdowns in retirement processing work, as they review employees’ applications before forwarding them to OPM. Challenges in HR have led to many retiring employees saying they are confused or frustrated, as they face delays, limited information and, for some, application errors.

Some fear the issues will only get worse as more retiring employees enter the process.

One former employee from HHS, for instance, described having to submit her retirement paperwork three separate times earlier this year. The employee opted to retire after being told she was one of 10,000 that HHS laid off in April as part of a reduction in force (RIF).

Despite being subject to the RIF, the HHS employee said her personnel file was incorrectly marked as a “voluntary retirement.” As she attempted to work with the agency to correct the error, she said she received conflicting and limited information from different parts of HHS, as well as OPM.

“I’ve been yanked around — the left hand didn’t know what the right was doing,” she said.

By now, the HHS employee has managed to receive her interim annuity payment, nearly five months after her official separation date, but is still waiting for her final annuity from OPM.

“I’m pretty happy that worked out, but getting there really required several months of working with my HR specialist,” the employee said. “I think there were some points that she was ready to pull her hair out.”

An HHS spokesperson declined to comment and referred all questions on retirement processing to OPM.

One employee retiring from a career at SSA also experienced delays in the retirement process. On multiple occasions, when he reached out to HR to request updates, he received auto-replies saying SSA’s HR department was “experiencing an unprecedented volume of requests,” according to emails viewed by Federal News Network.

Still, the SSA employee expressed a level of understanding for the delays he experienced.

“All the people in my agency did the best they could,” the employee said. “I’ve been in the dark a good bit, but that’s through no fault of anybody’s.”

In response to questions from Federal News Network on retirement processing, an SSA spokesperson said the agency “has the right level of benefit specialists dedicated to processing employee retirement applications in a timely manner.”

“Processing times vary based on when an employee submits their application, the completeness of the application, and the review process,” the spokesperson added.

For some, the retirement challenges go back to the beginning of the year, prior to the DRP flood. One IRS retiree who retired in January described limited information from HR throughout the process. Though his application eventually made it to OPM and was finalized, he questioned how IRS would handle much higher volumes later in the year from the DRP.

“If you’re months behind from 1,400 people, what are you going to do when 22,000 people go at once?” the retiree said.

The situation at IRS has changed considerably since January. Some currently retiring IRS employees described the agency’s HR office being far behind schedule. Several told Federal News Network they have not received their lump-sum annual leave payouts, nor their interim annuities.

“It’s crazy, and we all feel very, very unsettled,” one said.

“We are in administrative limbo,” another said. “We’re just all at a standstill.”

Over the last few months, retiring IRS employees have received multiple mass emails from the agency’s HR office, asking for patience as the office worked to process an “unusually high” workload. The office has asked employees not to call with questions, as that could lengthen the delays, according to emails viewed by Federal News Network.

“Even with this increased volume, our team remains fully committed to ensuring each retiree receives the support they deserve during this important transition,” one email reads.

An IRS spokesperson did not respond to multiple requests for comment from Federal News Network.

Governmentwide, the processing delays were also exacerbated by the 43-day government shutdown. OPM’s Retirement Services (RS) division continued to operate throughout the shutdown, since it is funded through a trust fund rather than appropriations. But slowdowns still occurred, as some agencies opted to furlough their HR staff during the funding lapse.

“When HR offices close down, finance offices close down, there’s nobody there to process cases and send them to OPM,” Kenneth Zawodny, a former associate director for RS at OPM, explained. “There’s still work coming in, but that big surge continues to be delayed and delayed and delayed.”

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For HR, it’s “the biggest test they’ve ever faced”

As retirement applications flooded into agencies this year, many HR offices quickly became swamped. Some HR employees themselves took the opportunity to exit their jobs, leaving larger workloads for those who were left.

Glieger, the retirement planning advisor, described many HR departments as “simply overwhelmed.”

“We have bottlenecking of a lot people that are leaving on DRP, and so [HR] just can’t provide the kind of support that they used to before,” Glieger said.

The challenges for HR have left some retiring employees in the dark. One described his experience in the retirement process as “not normal.”

“Because of their caseload, I was just one in a huge stack of people,” the employee said.

The governmentwide HR workforce had been steadily growing over the last few years. Overall, HR staffing increased by about 8,000 employees between fiscal 2020 to 2025, according to OPM data.

But due to the Trump administration’s efforts to reduce the federal workforce, HR staffing has decreased by about 5% so far in 2025, with agencies losing a cumulative total of about 2,600 employees. The numbers are only accurate through September, however, and do not include HR employees who left their jobs through the DRP.

A former agency chief human capital officer (CHCO), who requested anonymity to be able to speak candidly about the situation, said federal HR has long been “chronically understaffed.”

“My heart is with the HR offices,” the former CHCO said. “They are overworked, underappreciated and this is really the biggest test they’ve ever faced.”

In 2022, OPM named HR as one of the government’s three ongoing mission-critical skills gaps. And during a 2023 CHCO Council forum, one participant noted difficulties in retaining HR specialists, due to a broader skills shortage in the HR profession.

“The agency is effectively competing with the private sector and the whole of the federal government,” the participant said.

The former agency CHCO also expressed concerns about the future of the HR profession in government, especially considering the higher workloads HR employees have faced this year.

“They didn’t create this mess,” the former CHCO said. “They’re the ones that were trying to implement what was never done before, with very little direction, very little support, and a lot of people yelling at them to move faster, without any understanding of what the consequences would be.”

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A second retirement flood lies in wait

As DRP applications inundate the government’s retirement process, agencies are also bracing for a second retirement wave at the end of this month.

Many federal employees choose to retire each December, since it can maximize their lump-sum annual leave payouts. That leads to a yearly, and expected, surge in retirement applications entering OPM’s system.

The DRP wave and the December wave make up a significant part of this year’s retirements: Employees with retirement dates in September and December, combined, account for 72% of all 2025 retirements, according to OPM.

In anticipation of the annual application surge each year, OPM temporarily adds more staffing to its Retirement Services division. That can mean anywhere between 30 and 50 additional full-time equivalents (FTEs) to assist with processing new applications. The agency also addresses the annual surge by increasing overtime hours for RS employees.

Kupor said those usual accommodations will be “a little bit higher this year because of the DRP-related retirements.”

But at the same time, OPM lost a significant chunk of its own workforce this year. The agency’s staffing has declined by more than one-third — about 1,000 employees — due to the DRP, as well as some RIFs and probationary firings.

In OPM’s RS division, the staffing losses have been relatively smaller. Since January, more than 100 RS employees have left their jobs either due to the DRP or regular retirement — a reduction of about 16% of that division’s workforce, according to OPM.

Currently, the RS division has about 300 employees who process incoming applications. Another 200 or so employees work in the call center to answer retirees’ questions, and several hundred more handle other types of cases, like survivor benefits and post-retirement adjustments.

In November, OPM’s Office of Inspector General (OIG) warned that “operating with a reduced workforce” will be a top management challenge for OPM in the coming year.

“The effective loss of this large number of employees represents a challenge facing OPM in building and sustaining an optimal workforce to support the agency’s mission,” a Nov. 24 OIG report states. “This reduction occurred rapidly and has created immediate gaps in operational capacity.”

Kupor, however, pushed back against some of the concerns from the OIG report.

“More headcount is not the answer to the currently long application processing and call center wait times,” Kupor wrote in Dec. 8 comments addressed to the OIG. “We have a comprehensive approach to address this … Nonetheless, given we are dealing with both paper-based and electronic-based applications and the sheer volume of applications we are receiving, we recognize that processing times are likely to increase in the short term.”

OPM looks to interim annuities. But some are waiting on that too.

In the short term, Kupor said OPM is trying to be “as transparent as possible,” while also asking RS staff to focus on delivering interim annuities to retirees as quickly as possible.

“We recognize that this is a very, very significant number of applications we’re seeing,” Kupor said. “We’re trying to get ahead of that and make sure that we can be responsive.”

The standard approach to retirement processing, in the past, has been for HR to work on a retirement application, and then send it to OPM, usually within 30 to 45 days, according to a former agency CHCO. An employee will also typically see a lump-sum payout of their annual leave within about two pay periods.

“A lot of people would live off that lump sum while their retirement annuity is being calculated by OPM to get an interim payment,” the former CHCO said. “But now they’re at a point where they’re not even able to do that.”

Lee, from OPM’s RS division, said having to wait months to receive an interim annuity payment is “the first thing retirees worry about” once separating from government.

Historically, about 40% to 50% of all retirement applications have been able to receive an interim payment almost immediately.

But more recently, OPM said it has made “system changes” that now allow for about 70% to automatically get an “instant” interim payment.

“This is a major improvement in financial security for retirees,” Lee said.

Some retiring DRP-takers, however, still expressed frustrations as they remain waiting on their interim annuities, as well as their lump-sum annual leave payouts, with little communication and few answers.

“This whole process has been a nightmare — employees are still showing up on rolls as active employees, and a large amount of employees have still not heard from HR,” one employee wrote in an email to Federal News Network. “We are literally stuck in limbo — no payments, no more checks. This is causing financial hardship for so many people.”

In another email viewed by Federal News Network, one HR representative told a retiring federal employee: “The events of this year and the large amount of employees leaving the federal government has put a strain on the normal processes.”

“Things are moving forward,” the email reads. “Just at a slower pace than normal.”

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A major step toward retirement modernization

The challenges in federal retirement this year come as OPM attempts to make longer-term improvements to the process overall.

After several years in the making, OPM fast-tracked its modernization initiative, the ORA platform. Over the summer, the agency launched ORA and began asking all incoming applications to be entered through the new platform.

For decades prior, OPM’s Lee said the retirement process was highly fragmented, with many agencies and payroll providers operating under different systems. She lauded the ORA as a “unified retirement ecosystem” that removes some manual processing steps that had been creating delays and bottlenecks. She said new automation features have reduced application errors.

“Now by the time the package reaches HR, it is far more accurate — it’s more complete than anything we have ever seen in a paper environment,” Lee said.

Lee added that OPM has continued to ask for feedback from HR specialists using the new platform, which she said has been critical in shaping ORA.

“That collaboration is one of the big reasons ORA is working as well as it is today,” Lee said. “They test new features before they were released. They told us immediately when there were glitches.”

Since its launch over the summer, more than 91,000 retirement applications have been initiated through ORA. Kupor said that generally, the rollout so far is “going very well.”

“It really enhances the front-end of the process,” Kupor said. “Instead of people literally printing out paper documents and sending those documents to our team in Pennsylvania to handle manually, [employees and HR offices] now can just go onto the [ORA] system and they can begin their application electronically.”

John Hatton, staff vice president of policy and programs at the National Active and Retired Federal Employees Association (NARFE) said that generally, adding more visibility through ORA and being able to see where a claim is in the process, is a significant improvement.

“We’re not out of the woods with the whole system being improved,” Hatton said. “But I think it’s a step in the right direction.”

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Some cite issues in new retirement platform

While many experts see OPM’s retirement modernization project as a positive development in the long run, some have expressed reservations about the timing of the rollout — coming at the same time as a major surge in applications.

“Retirement is already a pretty stressful process for people, so then on top of that, not having a clear process or information about a new system only adds to the anxiety,” said Glieger, the federal retirement advisor. “[OPM is] very hopeful that over time this is going to be a good system, but right now there are a lot of moving parts that have to come together for all of that efficiency to really start showing up.”

OPM has rolled out three versions of ORA since the platform first launched in June. OPM’s Lee said a “big re-platforming” in August went “extremely well,” something that she credited to the feedback of HR specialists who pointed out development issues early on.

The initial rollout of ORA over the summer, however, also hit some bumps in the road. The update caused many retiring employees to resubmit their paperwork at the request of their agency HR offices, according to multiple retirees.

The new ORA platform, notably, also contains an auto-population feature, which fills in employees’ service history, annuity estimates, high-3 calculations and more.

Some employees who have used ORA described seeing errors appear on their applications, after being auto-populated. One DOJ employee who resubmitted her application on ORA said an auto-populated error led to further delays. Her experience was “confusing,” she said, adding that some parts of the ORA platform were “too limited.”

A DOJ spokesperson told Federal News Network that the agency “continues to look for ways to improve the offboarding process to ensure employees are processed out in an efficient and timely manner.”

In November, the IRS’s HR office also acknowledged that ORA had been auto-populating incorrect data for retiring employees. The errors were apparent in calculations for service history, “high-3s” and sick leave, according to emails viewed by Federal News Network.

“Please rest assured that your HR specialist will include accurate documentation with your retirement package,” the message said. “These documents will ensure that [OPM] receives the correct information needed to process your retirement accurately.”

Lee said the auto-population feature of ORA is intended to give retiring employees an opportunity to identify and correct errors earlier on, and to “reduce preventable issues” before they further slow the process down the road.

“Instead of relying on guesswork or waiting weeks for an answer, ORA shows employees exactly what’s finished and what needs attention,” she said. “It took a complicated, technical process, but it made it straightforward and manageable for an employee.”

But some employees said they are continuing to experience technical difficulties with OPM’s platform. In one example, when a retiree struggled to get a temporary password from OPM to access ORA, her inquiries to OPM’s customer service went unanswered. She instead received automatic email replies, saying it would take two weeks to generate the password.

“I have still not received any money — interim annuity or even annual leave payment,” the employee told Federal News Network. “It has been a mess!”

Kupor said OPM will continue rolling out new versions of ORA as more features or adjustments are needed. At the same time, though, he acknowledged the frustrations from retiring employees who are experiencing long wait times, and who had to resubmit their applications.

“We’ll never just kind of clap our hands, declare ourselves done,” Kupor said. “This is a major modernization project, and it’s going as well as we could have expected. We obviously appreciate that this is an incredibly important thing for us to get right and to get timely. And we totally respect the fact that after a long career in federal service, people expect that they should be able to retire with dignity, and in an efficient way.”

OPM’s long-time efforts to modernize federal retirement

The ORA platform was an initiative that began under the Biden administration as part of a multi-year strategy to modernize the government’s entire retirement process. The Trump administration has since taken up the mantle and continued the initiative this year.

“I really do believe it’s an improvement. It’s something I’ve been waiting for — for a long time,” said Tammy Flanagan, a federal retirement expert and advisor with Retire Federal. “I can’t understand why it took this long, and I was concerned that OPM implemented it this year, but maybe it’s a good thing because of the volume. Maybe it will help ease that burden.”

By now, OPM has onboarded major payroll providers, including the Interior Business Center (IBC), National Finance Center (NFC) and Defense Finance and Accounting Service (DFAS), to the new ORA platform. OPM said it is still working with some smaller providers to bring them into ORA.

Shriver, the former OPM acting director under the previous administration, said he was “glad to see” the modernization efforts continuing.

“But an online retirement application is only step one,” Shriver said. “If you have a bunch of digital applications coming in, but you still have a paper process on the back end, you need people to take those applications [and] turn them into actual annuity payments.”

For decades, OPM has been trying to update its retirement systems, with some efforts dating back to the 1980s. But time and again, the agency’s attempts at modernization have fallen short of expectations.

In 2006, for instance, the agency awarded a contract aimed at digitizing the retirement process, but the effort ultimately failed to deliver.

Then in 2010, OPM tried taking smaller steps toward updating the retirement process, an initiative that made some progress, until the agency changed course again a year later.

In a report from 2011, the Government Accountability Office wrote: “For over two decades, OPM has been attempting to modernize its federal employee retirement process by automating paper-based processes and replacing antiquated information systems. However, these efforts have been unsuccessful, and OPM canceled its most recent retirement modernization effort in February 2011.”

After a major data breach hit OPM in 2015, the agency had to scrap many of its IT modernization plans, including the ongoing efforts to modernize the retirement system.

Then during the Biden administration, the retirement modernization effort took on yet another new shape. In 2023, OPM’s Office of the Chief Information Officer (OCIO) issued a multi-year IT strategy, which became the basis for many of the retirement updates OPM is still continuing now.

What a past surge indicates for those retiring now

The current surge in retirements across government is uncommon, but not entirely unprecedented. In 2013, OPM faced another massive retirement wave.

During fiscal 2013, OPM processed 138,039 total retirement claims from federal employees. It’s the highest volume OPM has had in at least the last 25 years — until now, with OPM on track to surpass 140,000.

In 2013, OPM attributed the delays in part to sequestration, which at the time forced the agency to curtail call-center hours and to suspend overtime hours for Retirement Services employees. The large volume also went hand in hand with longer processing times.

For Zawodny, the former OPM associate director of RS, the problems boiled down to a lack of funding and resources at OPM.

“Without the adequate staffing, without the adequate automation, there’s nothing you can do,” Zawodny said. “There’s only so much that’s going to be able to come through that funnel at a time. No matter how much you pour on top of it, it can’t all come out evenly.”

Zawodny said over the course of 2013, the backlog continued to increase. The office attempted to address the paperwork surge, similar to the current situation, by having staff work overtime.

Later, after getting approved to make more hires in RS, Zawodny said it still took OPM months to get the new recruits through a lengthy hiring process.

“And then you have to train the individuals,” he added. “It took upwards of nine months to a year to get an individual ready to start processing, doing calculations, providing benefits and advice.”

Congress eventually got involved, raising concerns about OPM’s absence of a long-term plan to overhaul the mostly paper-based process, combined with across-the-board budget cuts and a lack of consistent leadership within OPM.

More than a decade later, OPM’s new modernization efforts have taken a significant step forward. But in the big picture, the ORA platform represents about one-third of the total work for overhauling retirement processing. ORA modernizes the user-facing part of the process, OPM officials have explained, but more work is ahead before the government’s retirement process can be considered fully digital.

OPM is still looking to upgrade its digital file system (DFS), which contains personnel data on all retiring employees, as well as “Janus” — OPM’s program for calculating retirement annuities for applicants.

“We are revamping an entirely manual process — we’re realistic enough to understand that takes time. It takes iterations of software development, it takes process changes,” Kupor said. “Our team is doing everything we can to be proactive and get ahead of it. I’m certain there will be lessons that we’ll learn and things that we can do differently as we go forward, but we are absolutely committed to the cause here.”

“Digital retirement is changing what federal employees can expect from all of us — from every agency, from our payroll providers, and from OPM as well,” Lee added. “We’re seeing real results today with faster service, fewer errors, greater transparency. We’re committed to continuously improving.”

Despite OPM’s long-term efforts, though, the Trump administration’s workforce disruptions across the entire year have ultimately heightened employees’ uncertainty, according to NARFE’s Hatton.

“Whether it’s a shutdown, whether it’s reductions in force, hollowing out agencies, hollowing out HR staff through the deferred resignation program,” Hatton said. “That all can create disruptions in getting these files processed. We’re especially concerned that the agency side of the process is going to be difficult.”

In the immediate term, Flanagan, the retirement advisor, recommended that retiring employees currently in the process keep an eye out for any communications from OPM or their agencies, while also simply being prepared for things to take much longer than usual.

“But I don’t know what else employees can do,” she said. “I really don’t.”

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The post ‘In the dark:’ Retiring federal employees face major delays first appeared on Federal News Network.

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Against the backdrop of Ukraine, growing East/West geopolitical tensions, and persistent cybersecurity attacks by nation-state threat actors, defense organizations are accelerating their efforts to harden digital infrastructure, including secure data exchange across borders and federated environments.

At its 2025 summit, for instance, NATO leaders agreed that future defense budgets must rise, and for the first time, the alliance’s spending target formally incorporates cybersecurity alongside more familiar priorities, including personnel and equipment. As a result, cyber resilience is now treated as a defined component of the broader defense investment framework.

Domestically, the U.S. military is also significantly raising its game. Announced earlier this year, the Army’s Unified Network Plan sets out a data-centric approach to modernizing networks, in an approach designed to create a secure backbone that links tactical units to command centers while embedding zero trust principles throughout. Among various other key priorities, it emphasizes resilience, interoperability with allies, and the implementation of a standardized data exchange through frameworks such as the Unified Data Reference Architecture.

The Department of the Navy’s Zero Trust Blueprint takes a similar path, laying out a phased strategy to integrate zero trust across enterprise IT and tactical systems. In particular, it mandates continuous verification of users, devices and files, and also identifies secure cross-domain transfers between classified and unclassified environments as a critical priority.

The Navy is also preparing to operate in contested environments where connectivity is unreliable, which is often referred to as denied, degraded, intermittent and limited (DDIL) scenarios. For instance, a submarine with no signal access must still operate securely, a challenge the Navy is aiming to address head-on.

The risks of reactive technologies

Despite this clear domestic and international commitment to zero trust strategies, however, an important security blind spot remains in the infrastructure of many defense organizations: file security. To explain, traditional approaches to file security were designed around perimeter control and reactive detection, technologies that remain crucial to a comprehensive approach.

A big part of the challenge, however, is that these tools, including antivirus, sandboxing and signature-based analysis, struggle to identify new or modified threats, leaving organizations particularly exposed to zero-day exploits and advanced persistent attacks. In practice, this means adversaries can exploit vulnerabilities in common formats such as PDFs, Office documents and email attachments to bypass defenses and gain a foothold inside sensitive networks.

In defense environments that require immediate and frictionless collaboration across complex domains and jurisdictions, these limitations present potentially serious risks. Specifically, files move constantly between classified and unclassified systems, between sovereign networks, and across cloud environments that host shared mission data. Once a file crosses the boundary, legacy controls cannot provide reliable security assurance, and consequently, a reliance on implicit trust or the absence of sufficient sanitization can allow hidden threats to spread laterally, with obvious consequences.

The zero trust data format

These initiatives indicate a clear direction of travel: defense organizations are moving toward architectures where data must be trusted only when verified, shared on common standards, and protected consistently across domains. The challenge lies in enforcing these principles in practice when information crosses networks, jurisdictions and classifications.

This is where Zero Trust Data Format (ZTDF) provides an essential foundation by extending zero trust to the file itself and ensuring that protection and policy travel with the data wherever it goes. It applies zero trust principles directly to individual data objects, including files, emails and structured datasets, by embedding encryption, access controls and auditability inside the data itself.

Instead of relying on the security of the network it passes through, each file carries its own protection, ensuring that policy and assurance travel with the data wherever it goes. ZTDF is also gaining traction in defense circles, having been ratified by NATO’s Combined Communications-Electronics Board as an interoperable standard for cross-border use. The underlying point is that nations need assurance that sensitive information can be shared with allies without losing control over how it is handled or exposing it to unnecessary risk.

On a broader level, these issues are indicative of a more general move towards comprehensive zero trust architectures across both public and private sectors. Civilian organizations that don’t already have adequate measures in place would be well advised to take note, particularly in light of the extremely damaging ransomware attacks that continue to make headlines.

Paul Farrington is chief product officer at Glasswall.

The post Why deeper defense collaboration demands a zero trust approach to cybersecurity first appeared on Federal News Network.

© Getty Images/Askhat Giliakhov

Interview transcript

Terry Gerton We’re going to talk about the National Defense Authorization Act. It’s in its final stages. It’s not a short read, 3100 pages. But there’s a lot of particular detail in there, especially around changes to cost and pricing rules. Start kind of at the headline level. What’s the big news that you want people to know?

Zach Prince Sure. So we’re still digesting this. So, you know, I wanna caveat that, you know, it is 3,100 pages and there’s a lot here, and it might not become final. But I think Congress has been listening while industry over the past many years has been saying that they’re reluctant to invest too heavily in defense when Congress makes programs subject to annual appropriations that might, for seemingly no apparent reason, go away after major investments have been made, when huge regulatory burdens can get imposed, like the cost accounting standards, which deviate substantially from generally accepted accounting principles or GAP, and things like certified cost of pricing data are required and just a slew of regulatory requirements that come with doing business with the government. These are real burdens to industry and real burdens to investors thinking about getting involved in the space. So listening to all of that, Congress took quite a bit of action in this NDAA.

Terry Gerton Let’s talk about some of those. You mentioned cost accounting standards. One of the biggest shifts is bumping that threshold from $50 million to $100 million. Who does that help? And what kind of burden does it remove?

Zach Prince So just as a bit of background, the cost accounting standards are accounting rules that apply to certain contractors, contractors that have contracts over size thresholds when otherwise exemptions don’t apply. They were imposed starting in the late ’60s, an effort spearheaded by the late Admiral Rickover and this I think mistaken belief that contractors were using accounting practices to get something over on the taxpayer. And so all these rules mostly came into effect in the ’70s and have stayed essentially the exact same since then, with some slight tweaks around the edges. But they deviate substantially from the accounting practices that most companies would otherwise have implemented. So they require really sweeping shifts in the way that you do a lot of your basic accounting as a company, and they apply on a contract by contract basis. So you might only have one or two contracts that are subject to CAS as opposed to your general gap rules. But because it’s very challenging to have two different sets of books and records, you might just have to implement these very annoying onerous rules across your entire organization, at least across your segment. I don’t want to go too far into the weeds. There’s a lot of complication here. It’s a burden and It doesn’t apply to small businesses, but it does apply to quite a lot of companies that would have large government contracts. And companies don’t want to trigger the threshold that gets them into CAS-covered contract performance because of the burden.

Terry Gerton And so by raising it to a $100 million, more folks will not have to worry about that conversion, right?

Zach Prince Yeah, that’s right. But the — I’d say the bigger item here that’s kind of buried, and if you look at the congressional report that they issued from the conference, it kind of ignores this, even though I think it’s a much bigger deal. It raises the exemption floor. So there are two different types of CAS coverage. There’s modified CAS coverage and there’s full CAS coverage. The full is the much more onerous one, but a contract is entirely exempt from CAS, full and modified if it’s below certain dollar threshold. So the $100 million, formerly $50 million, that’s for full CAS. But a contract is totally exempt from CAS no matter what under the previous rules, if it was below $2 million or $2.5 Million, with the threshold changed. Now they’re raising that to $35 million. So huge, huge difference. And it makes a difference not just for modified CAS, but also for full CAS, because full CAS coverage is triggered by either a single contract of $100 million or greater, or net $100 million in the prior cost accounting period. So if you had $200 million in contracts in the prior year, none of which exceeded $35 million under this new regime, you still are not going to have a contract subject to full CAS. So I don’t know what the numbers exactly are in terms of impacted contractors, but I have to imagine that this is gonna exempt. A whole slew of contracts that previously would have been subject to CAS.

Terry Gerton I’m speaking with Zach Prince. He’s a partner at Haynes Boone. So some people may be wiping their brow and thinking they’re gonna get a reprieve here. But Congress has asked for a report on how many of these changes are gonna play out. What would success look like? What do you think they’re hoping the impact of some of these changes will be?

Zach Prince So I think that they’re hoping this is going to spur greater investment, particularly by successful commercial technology companies and by successful investors in the defense space and particularly cutting edge defense tech. If you look at the multi-year appropriation provisions that are part of this NDAA, I mean they touch on some of the really interesting and important areas for advancement, like material composition issues, hypersonics, things along those lines, autonomous programs of various sorts, that we really are concerned that we could lose an edge to competitors overseas and that there needs to be substantial private sector money to go into because there needs to be huge scientific breakthroughs and that stuff’s costly.

Terry Gerton Tell us a little bit more about the multi year provision because you mentioned up front that companies are reluctant to invest if they’re gonna be on an annual appropriation cycle.

Zach Prince Yeah, and we’ll see how some of this plays out. But I think we all are familiar with major defense programs over the years that have been abruptly cut back for various reasons. But if you look at the Zumwalt class destroyer, for example, where there was a huge buy that was initially authorized and that was then cut back, which of course means that suddenly the R and D costs that were distributed over, say 20 ships, are now bunched into three or four. And now the program looks like it costs way more than initially was planned on a ship by ship basis, which technically is true, but is not really true overall and it results in scrutiny and program cancelation. So yeah, I think from my experience talking to folks in the private sector, they hear about programs like that where there’ve been huge investments that things are then abruptly cut, and they don’t want to get involved in the ecosystem that has those problems. And they know that, especially recently, when we’ve got CR after CR, you can’t rely on Congress necessarily to provide funding in a timely fashion, even for pretty important programs.

Terry Gerton There’s another newsy bit in here. You and I talk quite a bit about contract protests. There’s a provision that allows DoD to withhold payments during protests. Spin that out for us a bit.

Zach Prince Yeah, this is one that I’ve been watching pretty closely for a while, and we’ll see how it plays out, but there’s been a concern I continue to maintain that this concern is not supported by the data, but concern that incumbent contractors will protest at GAO, which has a mandatory stay that kicks in, in order to take advantage of a bridge contract that might be issued. Then the government says, Okay, well, you’ve lost the contract, but you’re still doing the work, we need the work to continue. We can’t go ahead and override the stay without some scrutiny. So we’ll just give you a 100-day bridge contract while this plays out. You’ll get whatever revenues you’re gonna get from that period, and continue. You know, I do think that this is a non-issue. it ignores the fact that protests are very expensive. The revenues you might get over a 100-day period are really not particularly significant in the grand scheme of things, especially when you’re irritating your customer. The data don’t show that this is abused very much, other than the idea that incumbents do protest more, but they also win more, which suggests that they’re in a better position to know when their problems in a procurement. But set all that aside, DOD in prior years has said, Well, Congress, we can’t require disgorgement of profits for these bridge contracts, which is what Congress had considered before as something that might remedy the situation because we don’t track the data. How do you calculate what a profit is for this period of time? So in response, Congress has come back and said, okay, so we’re just going to authorize contracting officers to withhold payments, period, under these bridge contracts up to 5 percent of total amounts that would be owed, and that those amounts up to that 5 percent threshold, which I think they established because it’s a rough order of magnitude of what profits might be, that could be deemed forfeit if there’s a decision ultimately that the protest lacked any legal or factual basis. So there are a lot of terms here that are gonna need careful definition and a lot of uncertainty of who’s implementing this, how you’ll challenge it, where you’ll challenge it. I mean, I think that this is a can of worms to address a problem that’s not real, but nonetheless, this is this is what Congress ended up doing.

The post New rules in the NDAA aim to cut red tape in defense contracting—but will they deliver? first appeared on Federal News Network.

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A former Accenture employee has been charged with allegedly misleading federal officials about the security of a cloud platform used by the Army and other agencies.

In an indictment secured by the Justice Department this week, Danielle Hillmer was charged with multiple counts of fraud over allegations that she concealed a cloud platform’s noncompliance with security controls required by the General Services Administration’s Federal Risk and Authorization Management Program (FedRAMP).

DoJ’s press release on the indictment states GSA’s Office of the Inspector General has been involved in the investigation.

The indictment doesn’t identify the cloud platform or company that Hillmer worked for at the time of the alleged fraud and obstruction. DoJ’s allegations cover a period between March 2020 and November 2021.

But Hillmer’s LinkedIn shows that during the time in question, she worked for Accenture Federal Services as “lead, cloud managed services” and “business and system owner, cloud management platform services.”

A copy of Hillmer’s LinkedIn profile, which was taken offline this week, shows she left Accenture in December 2021 and was most recently a “senior product manager for public sector” at SentinelOne.

“As previously disclosed in our public filings, we proactively brought this matter to the government’s attention following an internal review. We have cooperated extensively with the government’s investigation and continue to do so,” an Accenture spokeswoman told Federal News Network. “We remain dedicated to operating with the highest ethical standards as we serve all our clients, including the federal government.”

In an Oct. 12, 2023, filing with the Securities and Exchange Commission, Accenture referenced how it made a voluntary disclosure to the government that initiated a DoJ investigation “concerning whether one or more employees provided inaccurate submissions to an assessor who was evaluating on behalf of the U.S. government an AFS service offering and whether the service offering fully implemented required federal security controls.”

“AFS is responding to an administrative subpoena and cooperating with DOJ’s investigation,” AFS wrote at the time.

A spokesman for SentinelOne noted that Hillmer left her position at the company this past August and said DoJ’s allegations have “nothing to do with her work at SentinelOne.”

“In her previous role at SentinelOne, she was not involved in any compliance related work for FedRAMP or any other program,” the spokesman added.

The indictment alleges that in March 2020, Hillmer sought to “uplift” the cloud platform in question from a FedRAMP Moderate to a High authorization, driven by recently awarded Army contracts that required FedRAMP High.

DoJ alleges that Hillmer ignored warnings from a fellow employee and an outside firm that the cloud platform wasn’t compliant with security controls required for a FedRAMP High authorization.

For instance, the indictment alleges that Hillmann was aware that system administrators could access the cloud platform without “necessary” multifactor authentication controls in place.

DoJ alleges Hillmer “concealed known issues” from assessors and authorizing officials, as well as submitted materials to FedRAMP and the Joint Authorization Board “knowing they contained materially false and misleading representations about the platform’s architecture, implementation of security controls and risk posture.”

In July 2021, the FedRAMP program granted the cloud platform a FedRAMP High provisional authority-to-operate (P-ATO), according to DoJ’s indictment. It says at least six departments and agencies, including the Army, used or planned to use the P-ATO to obtain authorizations for cloud products and services. The contracts or subcontracts involved were valued at more than $250 million, according to DoJ.

The criminal charges against Hillmer carry heavy weight, with the wire fraud charge alone carrying a maximum of 20 years in prison.

Lawyers representing Hillmer didn’t respond to an emailed request for comment.

The case is notable, as DoJ has increasingly pursued legal action to enforce federal cybersecurity requirements. DoJ’s Civil Cyber-Fraud Initiative has resulted in multiple False Claims Act settlements with companies for allegedly failing to meet contractual security requirements.

However, a criminal case targeting an individual employee for allegedly misrepresenting security controls will be closely watched in the FedRAMP community.

Most conversations around the cloud security program in recent years have focused on streamlining the FedRAMP process, which is often considered a barrier to agencies accessing new technology.

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Interview transcript

Terry Gerton Deloitte’s got a new report out that suggests that inefficiencies and mission support functions are diverting resources from war fighting. Can you start by walking us through the central argument there? How do you connect those dots?

Tom Muir Sure, it’s a great topic, and certainly one that’s timely, not just for the Department of War, but other federal agencies. We think we’re at a unique point in time for government agencies, particularly with artificial intelligence, machine learning, an empowered and upskilled workforce to deliver on the promise of back office services. We won’t call them back office services in this report. We call them mission support services. Because at least when they’re the Department of War, Department of Defense, it is absolutely critical that they make the most of their budget and their priorities to focus on the mission of the department and the priorities to meet the national defense strategy and to enable our national security. We think we have a unique period of time for the department to deliver at speed and scale. They’re doing this in their mission. Secretary Hegseth talked about this about a week ago about acquisition transformation. And they can do that, take that same approach to mission support services that enable the mission of war fighters, improves readiness, enables the department to do their mission, and from an employee perspective, improves the ability of employees to leverage new technologies to deliver on their tasks in support of the mission.

Terry Gerton So you and I both spent some time wandering the halls of the Pentagon on the OSD stack. Many enterprise reform efforts have failed or come up short when it comes to being deployed in DOD. Talk us through some of the cultural difficulties and the organizational difficulties in doing this kind of reform.

Tom Muir Well, as you and your listeners know well, the department is budgeted and funded through appropriations under Title X, right? Military departments are funded to drive the performance of their military departments aligned with Department of War, Department of Defense priorities and national defense strategy. So part of the budget process would argue against this, but in order for them to achieve the efficiencies and effectiveness that the department needs to drive its mission capabilities, there’s a consolidation that’s critical for them to achieve that speed and skill we talked about earlier. We think that this is a unique opportunity because for the first time in, at least in my experience working in the Pentagon and agency supporting the Pentagon, they have a number of private sector leaders that are present in key leadership positions across the Department of War and Department of Defense that this be this is second nature to them. Improving performance, delivering on customer experience, reducing costs, recapitalization and empowering and upskilling the workforce is what they have done in private sector. And they’re bringing that same experience and insights to their government positions now inside the Pentagon. So we think because of technology, leadership and the current environment of cost savings and delivery on mission, this is the right time to have this conversation.

Terry Gerton People have said for years that Fortune 100 global companies can do this and are incentivized to do this, but the military operates under different constraints. So all of those private sector folks sometimes run up against some real obstacles in the military. What are some of the lessons that you think from the corporate world get that can realistically be applied inside DoD?

Tom Muir That’s a great point. You know, we cannot expect to apply all the lessons from private sector to the Department of Defense or Department of War. It’s just, it — particularly not carte blanche. It is a unique mission. It is critical to our national security. It is critical to our economic security globally. And so the Deloitte team has significant experience throughout the years working with Fortune 100 companies to stand up technology-driven multifunctional back offices. So this brings together HR, IT, finance, and acquisition of the four that we’ve specifically focused on in terms of our mission support services in this paper. And our work in private sector, we enable that consolidation, centralization, and mission focus of these cross-functional teams. Many agencies in private sector or companies in private sector call this a global business service. We tend to refer to it in Deloitte as sort of a center office concept, not a back office, because these offices and functions are critical to the mission of the performance of government agencies. For the private sector, we call them business units. Critical in the performance of business units, lowering cost, driving efficiencies, delivering on profit and loss statements to enable shareholder interest. In government, we think it’s more critical. It’s delivering on mission. This is not just about cost effectiveness and performance and efficiencies, it’s delivering on mission.

Terry Gerton I’m speaking with Tom Muir, he’s a specialist executive with Deloitte. So Tom, one of the big recommendations in your report is that all of this can be AI enabled, taking an AI-first approach. Talk us through how that would work. Is that sort of a way to bridge what kind of have been long running cultural differences between the services and the DOD staff? And what safeguards need to be in place if you’re going to deploy AI in a defense sector?

Tom Muir That’s a great question. You know, the Department of Defense is accelerating the adoption of advanced AI right now and machine learning in support of military capabilities to address their national security challenges. That same approach applies for these functional areas of HR, IT, finance, and contracting. Many of us employ AI routinely in our daily lives, and the workforce ought to be able to employ AI in their workforce lives to deliver on mission. We think AI can immediately apply to a wide range of DoD missions. But when we think about AI to improve audit readiness, right? The Department of Defense is under a statutory requirement to get a clean audit by December of 2028. And the Department truthfully has struggled with that remediation projects over the previous years. There’s a unique ability right now with the technologies available in AI and machine learning to drive that audit readiness, audit remediation, enterprise data management, acquisition of common goods and services at a lower cost point, at greater efficiency and greater performance. There’s an ability for them to gain significant momentum in some of these projects that they’ve already undertaken and pilots that they have advanced for the use of AI and ML technologies and deliver those tools to their workforce and upskill this workforce to use those tools to deliver better performance. We think we’re at a unique point, rather, for our agencies to do this within the Department of Defense, within the Pentagon.

Terry Gerton So Tom, I looked at the back of the report and there’s a ‘what DOD can do today’ page and I thought we could have pulled this from 1990 or 2000 or 2010 or 2020. What makes today’s environment different where Deloitte thinks that this is actually achievable?

Tom Muir The delight team has taken this approach, particularly with the Department of War, Department of Defense, because we think it’s based on three things. The first is, it is a tech forward approach to solving some of these pervasive problems that you and I just talked about, Terry, that have been very difficult for government agencies to move forward over decades. Right? We’ve done a bunch of shared services initiatives that have not gotten the department very far, not just the Department of War, Department of Defense, but other agencies as well across the federal government. We think there’s a second piece to this, and that is it’s a show not tell. We think there’s an ability for AI and ML to deliver to workers and workforce to not study the problem, but to demonstrate very rapidly in matters of weeks and months, not six months to a year, and implement technologies and, as you mentioned earlier, safeguard those technologies, right? There’s a cybersecurity discussion and an ethical use of AI discussion to this to this challenge. And we think the department is putting together policies that do just that. And the third piece is focus on outcomes, not processes, not business processes, but transforming business processes to deliver outcomes for the war fighter in the Department of Defense, Department of War’s discussions. But for other agencies, it’s deliver outcomes for their departments, agencies and bureaus. In business, it’d be deliver, you know, outcomes for the business units and profit and loss statements. That same discussion applies just to the bureaus and the agencies across the federal government.

Terry Gerton So let’s assume that DoD takes Deloitte’s recommendations and moves out on them and implements them. Five or 10 years down the road, what would look different and how would you measure or demonstrate that the efficiencies have actually improved readiness?

Tom Muir The great question. You know, in our minds, at least as we discuss this amongst our teams and as we share this with our clients in the Pentagon and in other federal agencies, we think looking back, right, 10 years from now, what does success look like? We think success is a consolidated mission support focused organization that delivers and manages standardized processes at speed and scale, leveraging technology to upskill the workforce, to allow them to live, to focus on cost and performance. We think when you look at the memorandums and the guidance that has come out recently from the Pentagon about recapitalization of the workforce, about acquisition transformation, it’s about delivery of the skill necessary to defend our nation, to deter threats and defeat them if necessary. We think that that’s critical when you look back, you know, from where we are today to that journey that they’re gonna undertake. And they’ve already taken many actions that’ve already begun. As you and I, who both worked in the Pentagon together, many of these actions are already in place. It’s just a matter of bringing that capacity and a consolidated, multifunctional mission support organization that allows them to deliver on the mission of supporting war fighters more effectively, more efficiently, at higher performance and lower cost. And then those cost savings can be put into critical capabilities necessary for war fighters at the front lines.

Terry Gerton How much of this can DoD do on its own without asking permission from Congress and how much does Congress officially need to support?

Tom Muir I believe that the Department has had an ongoing conversation with Congress, you know, particularly the oversight committees, both the HASC and the SASC in particular, and the appropriations committees on their outcomes that they’re looking to achieve by their transformation plans. We saw the first one just brought forward by the secretary of war last week. Secretary Hegseth discussed where he thought the department needed to move with acquisition transformation. I think we’re starting to see more of those in terms of direct report program portfolio management offices and how the department is tackling some of these large national security challenges. That dialog is ongoing. I think the department can do all of this within its budget and take that budget and put it back towards war fighting missions, right? The cost savings that come from this multifunctional shared service delivery services in support of their mission can be put towards that frontline war fighting mission. So I think that this is savings to the department that they can then put against mission and delivery for war fighters.

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Service members will see a 4.2% average increase in their basic allowance for housing in 2026 — a smaller boost than the 5.4% increase they received in 2024 and 2025. 

But the actual increases military households will receive will vary depending largely on where they are stationed and their pay grades. While the increase is higher in some areas, the rates decrease in several areas, including Phoenix, Arizona, and Brownsville, Texas. Service members stationed in areas where rates go down are protected and get to keep their existing BAH. 

Look up your 2026 BAH rate here.

The Defense Department calculates the annual rates based on surveys of rental costs and utilities in each market. Data sources include Census Bureau surveys, the Bureau of Labor Statistics’ Consumer Price Index, commercial subscription rental cost databases, major online rental listing websites, and input from the services and local installation housing offices.

The calculation of the allowance is built to cover approximately 95% of average costs for an off-base housing and utilities, leaving roughly a 5% out-of-pocket expense for service members. In 2026, these amounts range from $93 to $212. 

Since the annual rates are based on 2025 data, they may not fully reflect rapid increases in actual rental costs.

The new housing allowance rates will take effect Jan. 1, 2026.

The department estimates it will pay $29.9 billion in housing allowances to approximately one million service members in 2026.

Basic Allowance for Housing is one of the largest components of cash compensation for service members, second only to basic pay. The fiscal 2026 defense policy bill, passed by the House on Wednesday, requires the Defense Department to “conduct a study to improve the calculation of BAH to ensure it keeps up with rising rental costs.” The bill also extends the Defense Department’s authority to issue temporary increases to BAH for one more year in areas hit by disasters or where housing costs differ from current rates by more than 20%.

The 2026 BAH increase comes as service members are also poised to receive a pay raise — the legislation approved a 3.8% increase in basic pay for service members. The must-pass legislation now heads to the Senate. The bill will then go to President Donald Trump for his signature. 

In 2023, BAH rates went up an average of 12.1% after housing costs had spiked the previous year.

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Interview transcript

Terry Gerton We’re gonna talk about military supply chain and logistics. A lot of defense leaders are still warning that supply chains are fragile despite some modernization, despite post pandemic recovery. From your perspective, how can AI play a role in building the resilience of those defense supply chains?

Jon Garrity I think AI plays a critical role. And the reason is that supply chains are intrinsically very complex. There’s a lot of information. It’s hard to grapple with all of it. You have end users who have some visibility into what they might have at a Ford supply point. And you’ve got the manufacturers who are receiving signals from higher level commands and from headquarters. And there’s a lot of latency between those different points of signal. And so AI presents an opportunity to effectively coordinate and orchestrate across that supply network, optimize decisions on everything from purchasing to stocking to mobilization, transportation, all different elements of supply chain logistics operations. So it really is a new paradigm the way that supply chain logistics can be orchestrated.

Terry Gerton The Defense Logistics Agency tells us that they’re now rounding dozens of AI models to monitor supplier risk and to forecast disruptions. When you think about the options out there, what do you think the most promising AI-driven approaches are to identifying vulnerabilities early and fixing them before they become problems?

Jon Garrity So a lot of the traditional approaches to using machine learning and supply chain applications come into things like demand forecasting or identifying patterns in the data. And obviously the zeitgeist now is all around large language models and how those can be applied. But the challenge is when you look at the initial attempts, you know, you’re focused on a very small set or subset of the logistics enterprise, which again could be demand forecasting, but that’s just a piece of the puzzle. And on the flip side, you have these very general models like a large language model that can answer very general questions in incredible ways. But they aren’t grounded in the realities of supply chain. They don’t have ways to reason over or optimize over such a large-scale system. So the the new opportunity and one we’re focused at with Tagup is building a world model, it’s called. So basically providing structure such that you can reason effectively over these large scale systems, right? What is the relationship between the receipt of materials and the the use of those materials, of transportation from a manufacturer and expiration of material downrange, right? Hard questions to reason about at scale for humans and even for legacy approaches. But now with these world models, you can effectively reason at that scale.

Terry Gerton We’re talking about supply chain here, but we’re also hearing from the Air Force and the Army who are investing heavily in AI-enabled predictive maintenance to cut down on downtime and improve readiness. How do predictive analytics, sort of like what you were just talking about, your world model and supply chain, how can that apply to traditional maintenance models?

Jon Garrity Yeah, very directly. So predicting a specific component failure on a specific asset is is very difficult, right? Even if you have it very well instrumented, it’s a hard problem. But it’s a useful demand signal. And certainly when you aggregate it over a fleet, you can get very high levels of accuracy and understanding, okay, in aggregate, how many replacement transmissions will we need for this program, right? As an example. And the reason is it’s it’s similar to you know picking stocks. It’s hard to pick the one stock that’s going to get you 100x returns. So you buy a portfolio and you’re going to have one that’s going to give you that high return. Similarly, if you have a fleet of vehicles or or a fleet of aircraft, you don’t know which one is going to have that catastrophic engine failure, but you know across the fleet that prediction that of that event will occur with some level of certainty, and that can inform upstream in the world model what decisions are being made. So, in short, it’s a very useful input to the overall optimization, but it’s just a piece of the puzzle.

Terry Gerton When you think about the array of military equipment, I mean everything from water filtration units to F-35s and aircraft carriers, how complicated is it to scale an AI model to cover that scope of inventory?

Jon Garrity Yeah, great question. The answer is that there are, regardless of what asset or platform you’re looking at, there’s a lot of commonality, right? They all have parts that are installed on them, the replacement parts, they have distribution around the world, they have certain patterns of utilization, maintenance requirements. So the world model can encode these basic rules that relate these elements and then can take the data that exists today. And I think that’s a big, big opportunity, right? When you look even at predictive maintenance, there’s so much data that exists in existing IT systems related to service requests, parts required, requisition, all kinds of things. And there’s a lot of signal in it. But to employ that signal effectively, you need to be able to provide that structure. And so in short, in spite of the scale, it actually is the strength for these AI models, because if you can apply that structure, the models can get better much faster because of the scale of the enterprise. So that’s that’s the opportunity with that scale.

Terry Gerton I’m speaking with John Garrity. He’s the founder of Tagup Inc. One more maintenance question just because maintenance is near and dear to my heart. Congress and DOD are pushing right to repair provisions to let service members fix their own equipment using digital manuals and 3-D printing. How do you see AI intersecting with that approach?

Jon Garrity In a couple of important ways, right? One we’re we’re looking at now is changing the way that you — so take 3-D printers as an example. Where do you put 3-D printers? Right. There are now platforms where they have 3-D printers and containers, that can be moved around the world. But where should you put those sources of supply, right? And so if you have data from maintainers as to what parts are required, you can ensure that, via an optimization, you locate the sources of supply, the advanced manufacturing, other capabilities close to the point of use. And so I think that’s one way that AI will improve the maintainer experience is making sure they have the tools and the parts that are necessary closer to the point of use and and basically ultimately reduce non-mission capable rates due to supply and and and maintenance.

Terry Gerton Okay, let’s take one step back from the military units themselves and talk about manufacturing capacity. Companies are using AI and advanced manufacturing to compress production timelines and reduce parts counts. How do you see these technologies then changing surge capacity, industrial base opportunities? Sort of, what’s next on the front there?

Jon Garrity And actually I think it is intimately tied in with military as the ultimate customer, right? What’s what’s critical is avoiding whiplash effect and having visibility upstream so that manufacturers have access to what demands are they and how can they be satisfied. And I think the opportunity is and it’s coming to play now where if you can track use of equipment, of parts at the tip of the spear, you know, downrange and provide visibility back to the manufacturers across the enterprise. Now the OEMs, the manufacturers, can understand how their equipment that they manufacture is being used, where it’s being used, where there are issues, and that can inform their investments. if you could — right now the purchasing for these programs is done in the current fiscal year, right? There’s not visibility over many years into the future. That’s a huge lost opportunity, both for negotiating better prices with the manufacturing base, but also ensuring that the capacity exists into the future. So I think that’s one of the most exciting opportunities for these sorts of systems at scale is giving visibility to the manufacturers as to what are the demands in out years.

Terry Gerton And that seems to take us right back to where we started, which was with supply chains and making sure that not only the military supply chain, but the commercial supply chain stays safe, secure, predictable.

Jon Garrity [The] most interesting applications in my view of these new AI systems is the ability to identify systematically what links in the supply chain provide the most risk against readiness or other operational requirements. And so you can be very systematic in identifying, okay, how can we store up capacity or ensure that we have redundancy and supply to avoid getting just hammered on our readiness rates. And I think that’s one of the, again, the ultimate aim, in my view, from these sorts of systems is to be able to tie tactical use of the end users, aggregated at its scale, and provide that visibility and signal back to the industrial base all the way back to the supply chain. And by doing that, we can strip out a lot of the inefficiency in the system and drive higher quality service to the end customer.

Terry Gerton Real time decision making inside the system that you just described has always been sort of the holy grail of military logistics. As you think about the future of integrating AI into each of those pieces and parts, are there any concerns that you have about the cultural obstacles or individual training obstacles that might make it difficult to optimize the value?

Jon Garrity I think there’s been — it’s certainly a paradigm shift in sort of the user experience, right? So yeah, I’m sure you’ve long, history and experience, Terry, in military logistics and and in the private sector too. You know, ERP systems have been with us for many years, right? Enterprise resource planning systems, they track what we have and where we have them. And you know, you have to know a lot of different codes and keyboard shortcuts to be able to efficiently navigate these systems and then ultimately, you know, you put those into reports that you can summarize up to your commanding officers. And what’s changing now is that, as you’ve maybe seen with ChatGPT related technologies, now you can you can just ask questions directly and get answers. The challenge of course, operationalizing those for defense applications and supply chain is grounding it in the reality of the situation, making sure you you’re not hallucinating, right? You can’t just ask chat GPT for docking policies. So there there is risk that needs to be mitigated to make sure, and that’s something we provide explicitly by providing that structure in the world model that you can make sure that the answers you’re getting, the COAs that are recommended are grounded in reality. But I do think there’s going to be a bit of a learning curve that I think will be tempered by the fact that a lot of people are using large language models now. There’s a familiarity in private use with these sorts of technologies. I think in many ways it will be a more intuitive user experience, but it will be a transition from the historical way of interacting with IT systems and log IT systems specifically.

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• The House has passed a $900 billion defense policy bill, which includes a 3.8% pay raise for service members. The must-pass legislation now heads to the Senate. Once it clears the chamber, the bill will go to President Donald Trump for his signature. The bill seeks to streamline the way the Pentagon buys its capabilities. Congressional leaders said the legislation would deliver “the most significant acquisition reforms in a generation.” It also fully supports Trump’s priorities, including banning all diversity, equity and inclusion programs at the Defense Department and fully funding the department’s border security efforts.
  (Houses overwhelmingly passes the 2026 NDAA, sending bill to Senate - House Armed Services Committee)
• The Office of Federal Procurement Policy wants to hear from you. As part of its rewrite of the Federal Acquisition Regulation, OFPP Administrator Kevin Rhodes is asking acquisition experts in and out of government for help in identifying acquisition practices that agencies should start, stop, continue, adjust or scale. Rhodes said in a new post on the Ideascale platform that the ideas should focus on strengthening stewardship, speeding up buying, reducing costs, increasing competition and supporting better outcomes. He hopes these ideas will better inform regulatory drafting of the streamlined FAR and the operational practices agencies will rely on going forward. OFPP wants suggestions by Jan. 7, 2026.
  (OFPP seeks input on acquisition best practices - Office of Federal Procur)
• The top official at the Office of Personnel Management is pushing back against warnings from the agency's inspector general. A recent OIG report found that staffing reductions at OPM this year have created gaps in the agency’s ability to operate effectively. In response, though, OPM Director Scott Kupor argued that the agency's past workforce size was inflated. He called the current staffing levels “appropriate,” after the agency lost one-third of its employees this year.
  (Agency comments on the OIG “top management challenges” report - Office of Personnel Management)
• More than a dozen federal statistical agencies are falling behind on producing high-quality data sets that shape the U.S. economy and government policy. Most statistical agencies lost 20% to 30% of their staff this year, which has led to some public-facing data sets being delayed, suspended or canceled. That’s according to an annual report from the American Statistical Association. President Trump fired the head of the Bureau of Labor Statistics this summer after the agency produced a monthly jobs report that showed hiring had slowed. The Department of Government Efficiency oversaw the elimination of five surveys at the Census Bureau that DOGE deemed "wasteful."
  (‘Bedrock’ federal data sets are disappearing, as statistical agencies face upheaval - Federal News Network)
• The Agriculture Department said it received mostly negative feedback on its reorganization plans. USDA plans to relocate more than half of its D.C.-area employees to five regions across the country. The agency said it received more than 14,000 public comments about its relocation plans. More than 80% of them criticized elements of the plan. About 5% expressed positive sentiment and about 7% were neutral.
  (USDA reorganization - Agriculture Department)
• One agency got a boost of funding for IT modernization before the Technology Modernization Fund expires. The TMF officially expires on Friday, meaning the board can only continue to oversee and fund existing awards. But the TMF Board made one more investment before the impending deadline. The National Nuclear Security Administration earned $28.3 million for three separate, but interrelated, modernization projects. Most of the funding, about $23 million, will go to modernizing the AI infrastructure for NNSA’s classified environment. Additionally, NNSA will use the remaining $5 million to update two other systems, FireGuard and the Turbo Federal Radiological Monitoring and Assessment Center (FRMAC) radiological assessment tool.
  (NNSA receives funding before TMF authorization sunsets - Federal News Network)
• The Cybersecurity and Infrastructure Security Agency wants to deepen its engagement with industry. Companies can sign up to share information with CISA through the agency’s new Industry Engagement Platform. The goal of the online platform is to allow CISA staff to more easily engage with companies, nonprofits and academia on new innovations and technology developments. CISA is particularly interested in IT and security controls, data analytics, artificial intelligence and post-quantum security. The cyber agency eventually wants to move to just one account for engaging across all of its services and information sharing platforms.
  (CISA looks for ‘deep engagement’ with innovators via new platform - Federal News Network)
• Several key acquisition provisions, including measures on pricing transparency, oversight of major programs and Other Transaction Authorities, were dropped from the final version of the fiscal 2026 defense policy bill. Both the House and Senate sought to close the loophole that allows companies to submit cost and pricing data after a contract price is agreed upon, but the proposal was removed from the final bill. House-led efforts to rein in cost overruns and strengthen oversight of major defense acquisition programs were also blocked during negotiations. Also left out is a House proposal to curb the outsized influence of tech giants over the cloud computing and artificial intelligence defense contracting space.
  (Here are key acquisition provisions dropped from the NDAA - Federal News Network)

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For months, congressional leaders have been working to deliver what they have described as “the most significant acquisition reforms in a generation.” But several key provisions — including measures on pricing transparency, oversight of major programs and Other Transaction Authorities — were ultimately dropped from the final version of the fiscal 2026 defense policy bill.

Both the House and Senate sought to close the loophole that allows companies to submit cost and pricing data after contract price is agreed upon. 

The House version of the defense bill included a provision that would prohibit contractors from using cost or pricing data that is more than 30 days old as a defense against defective pricing allegations. Lawmakers backing the proposal said it would “empower the Defense Department to enter into contracts with sufficient pricing information.”

The Senate version of the bill contained a similar provision, but both proposals were removed from the final bill. 

Instead, lawmakers directed DoD officials to examine whether late disclosures of cost or pricing data is a systemic problem and recommend ways to fix it. 

“We note that the sweeps process under the Truth in Negotiations Act is a post-price agreement review requiring contractors to disclose any updated cost or pricing data in their possession for certification before contract award. We are aware of concerns that contractors may not be providing disclosures of cost or pricing data in their possession prior to a price agreement, opting to disclose such data only after agreement and immediately before contract award,” the lawmakers said in the joint explanatory statement. “This practice may result in upward adjustments to contract pricing without providing time for sufficient review due to factors such as the expiration of funds or urgent military needs for the products or services.” 

House-led efforts to rein in cost overruns and strengthen oversight of major defense acquisition programs were also blocked during the conference process. The proposal would have accelerated the Pentagon’s reporting timeline, requiring the department to alert Congress within 30 days of any significant or critical cost overruns.

Also omitted is a House proposal to curb the outsized influence of tech giants over the cloud computing and artificial intelligence defense contracting spaces. The measure would have directed DoD to ensure there is a competitive award process when procuring cloud computing, data infrastructure and AI capabilities.

OTA reforms 

While other transactions are intended to move innovative technologies out of the lab and into production, lawmakers said it remains unclear how often these agreements actually lead to follow-on production contracts. 

But a House proposal that would have required Pentagon officials to provide a report on detailing use of follow-on agreements made under Other Transaction Authorities between 2022 and 2025 did not make it into the bill.

Instead, the Government Accountability Office was directed to conduct a review of how OTAs are used, including whether follow-on agreements deliver long-term capability.

The House also sought to require large OTA-funded projects to follow the same oversight rules as major defense acquisition programs, but that proposal was ultimately dropped from the final bill as well.

Small business and workforce provisions left out

A House provision aimed at expanding opportunities for veteran-owned small businesses was stripped from the bill — the measure would have required DoD to set annual contracting goals for small businesses owned by veterans. Moreover, it would have allowed the Pentagon to use noncompetitive procedures when awarding certain contracts to veterans.

“We note that veteran-owned small businesses are an important part of the defense industrial base and we encourage the Secretary of Defense to continue supporting veteran-owned small businesses,” the lawmakers said.

The House’s proposal to create a standardized Schedule V for reporting veteran employment and retention data across all DoD contracts and grants was also dropped from the final bill.

Another House provision would have required the department to ensure contractors are meeting the federal 7% disability hiring requirement.

Portfolio management reforms

While the move to a more portfolio-centric approach to acquisition is a feature of the defense policy bill, negotiators dropped a Senate proposal to establish “capstone requirements” for future portfolio acquisition executives. The shift in strategy for defining needs aimed to improve speed and innovation by revising programs in consultation with the Joint Requirements Oversight Council.  

The House also tried to address DoD’s longstanding high turnover in key acquisition leadership roles by requiring a six-year minimum assignment for bosses formerly known as program executive officers, but the effort failed to advance. Instead, the final bill directs the Pentagon to brief Congress next year on “actions taken to strengthen stability in program management and tenure for critical acquisition positions.”

Legislators did endorse the spirit of the foiled measure.

“Stable, milestone-aligned tenure is essential to program continuity, accountability, and cost and schedule performance. Short-term assignments can incentivize short-sighted decision-making by officials who will not be present to manage long-term consequences,” they said. “Longer tenure strengthens accountability by ensuring that the same leaders who initiate major acquisition decisions remain responsible for their execution and outcomes. Frequent rotations disrupt long-term planning, erode institutional knowledge, and hinder the Department’s ability to deliver capabilities to the warfighter on time and within budget.” 

The House passed the annual defense bill on Wednesday. The legislation now heads to the Senate.

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The 43-day partial government shutdown left us all bereft of information technology news and updates on program progress. Now that agencies are funded at least through Jan. 31, the conference circuit is in its end-of-the-year sprint and lawmakers are working on the final touches of the defense authorization bill, there are some interesting IT news items that have emerged over the last week or so. Here are three of them that deserve highlighting.

TMF Board beats deadline

The Technology Modernization Fund officially expires on Friday, meaning the board can only continue to oversee and fund existing awards.

While the House was attempting to add a provision to the fiscal 2026 defense authorization bill to extend the TMF, the board quietly made at least one new award before the impending deadline.

The National Nuclear Security Administration earned an investment of $28.3 million for three separate, but interrelated modernization projects.

The agency will use the funding “to modernize the foundational technology infrastructure supporting its nuclear security missions through an integrated cloud and artificial intelligence transformation. Current systems have critical vulnerabilities: the FireGuard wildfire monitoring activity requires intensive manual analysis across classification barriers; the Turbo Federal Radiological Monitoring and Assessment Center (FRMAC) radiological assessment tool cannot communicate with other emergency response applications; and limited AI development infrastructure prevents rapid evaluation of models for nuclear security threats. These vulnerabilities hamper data aggregation, slow emergency response, and leave gaps in the agency’s ability to assess evolving technological risks.”

A government source with knowledge of the TMF award said most of the funding — about $23 million — will go to modernizing the AI infrastructure for NNSA’s classified environment.

NNSA has been building out its classified environment in the cloud for much of the last two years and the influx of funding will accelerate that effort.

For example, NNSA recently implemented AskSage’s platform to access secure AI tools through the Army’s tenet.

The source said through the TMF investment, NNSA can more quickly implement its own version of AWS, Microsoft and Google clouds with AI tools built in.

NNSA expects to create a centralized AI infrastructure for its classified users to make it easier for them to access these tools more quickly.

This was NNSA’s second TMF award. It won $3.8 million in July 2024 to modernize its Radiological Response Data Portal.

The source said the other two projects, for which NNSA will receive about $3 million for FRMAC and $2 million for FireGuard, were grouped together as part of the overall modernization initiative because they will rely on AI and machine learning tools.

“Through the TMF, FireGuard aims to use machine learning to automatically track fire boundaries and move data between computing systems. This automation would allow analysts to spend their time verifying maps instead of drawing them from scratch, which is particularly critical as wildfires pose growing risks to nuclear sites,” the TMF states on its website. “Through the TMF, NNSA plans to shift the Turbo FRMAC radiological assessment tool from its legacy desktop software to a cloud‑based platform, providing emergency teams with the speed, accuracy, and collaborative capability they need to protect the public and critical infrastructure during radiological crises.”

The source said while much of the work to modernize the systems and to develop the AI infrastructure was already underway, the TMF money certainly will help NNSA move faster.

And that idea of moving faster brings us back to Congress failing to extend the program’s authorization. While plenty of programs operate without authorization, it seems like this type of investment, at least for the short term, is on hold.

There still is some hope, as the Senate did allocate $5 million for the TMF in fiscal 2026 in its version of the Financial Services and General Government appropriations bill. This is the first time in three years lawmakers didn’t zero out new funding for the TMF.

Commerce, USDA race for AI

The departments of Commerce and Agriculture are in a friendly race to see who can implement the new USAi platform first.

Brian Epley, Commerce’s chief information officer, said at ACT-IAC’s Executive Leadership Conference last week that, hopefully within the next few weeks, employees at all bureaus will be able to begin using the different large language models for their use cases.

Meanwhile, Tony Brannum, the chief information security officer at Agriculture, said deployment of the AI shared service across the agency is imminent as well.

These would be the first agencies to take advantage of the USAi platform, which GSA launched in March and expanded this summer to provide generative AI chatbot tools for other agencies.

“The code base is the same as GSAi. It is just a copy for our agency partners to use so that they can do that deep exploration across a broad portfolio of generative AI technologies and large language models, but most importantly, capture the observability telemetry data so that they can make informed decisions about how they’re going to buy well into this disruptive space in the future,” GSA CIO Dave Shive said at the ELC conference.

GSA says the USAi platform is part of how it’s providing agencies the opportunity to try out AI tools that previously would’ve either been cost prohibitive to roll out across the agency or included too much risk.

Zach Whitman, GSA’s chief AI officer, said USAi has become an interagency project in terms of developing and learning from its use.

“With a tool like USAi, you can really get practical, hands-on data to suggest these are the ways in which we’re seeing this adoption curve today. And the telemetry that we’re gathering in terms of how frequently do people use the thing is an important step for the program development,” Whitman said. “But then also, what are they asking of this tool? What kinds of mission functions are they using this tool for? That true fidelity on how the thing is being used is, I would argue that the real value proposition of a tool like USAi is to be able to see inside how the workforce is truly adopting this new technology to such granularity, and then shape policy and workflows to maximize that utility has been an eye opener for us, as well as our partners.”

As for Commerce, Epley said it will use the chat prompt tools to answer specific questions that arise in each bureau based on their individual use cases.

“We have an AI use case inventory of more than 300. USAi will bring Commerce to life when it comes to AI tools,” he said. “We looked at what we were doing on our own when it came to AI and decided it was best to partner with GSA. The majority of our workforce doesn’t have a working knowledge of AI, so now they will have tools at their fingertips. We expect USAi to increase our productivity for our employees and for the mission.”

Epley added that Commerce will use its lessons from implementing USAi and create a playbook for other agencies to ease their move to the shared service.

This is a multi-year effort for Commerce, as Epley expects they will have to optimize the value of the LLMs and figure out which tools are best for which mission area.

As for USDA, the implementation of USAi is the culmination of a decade-long journey to improve its data tagging.

Brannum said knowing what data the agency has, where it’s located, and who has access to it will make the application of AI tools easier.

“There is a lot of interest in AI across the agency. We are asked why something is blocked, or once they see something out there from GSA, they ask to use it,” he said.

JWCC-Next, JOE and more from DISA

The Defense Information Systems Agency will continue to run its own multiple award contracts for the foreseeable future. DISA’s Procurement Services Executive Doug Packard, who will retire in January after more than 35 years in government, said the agency has no immediate plans to consolidate acquisition programs into GSA.

That means the Joint Warfighting Cloud Computing Contract-Next (JWCC-Next) and several other high profile programs will remain in play for 2026.

At DISA’s annual industry day on Monday, executives said JWCC-Next, Olympus, the Joint Operational Environment (JOE) and several other major IT programs are positioned for significant progress over the next year.

Byron Stephenson, the J-9 vice director for the Host and Compute Center at DISA, said DISA has been working with the DoD CIO’s office to collect requirements for the new contract.

“We are still looking at all the requirements that were collected across the department to ensure we bring the best cloud capable contract for the future,” Stephenson said.

He expects DISA to issue the JWCC-Next solicitation during the third quarter of fiscal 2026 and make an award about a year later.

Additionally, DISA will issue a solicitation in the second quarter of fiscal 2026 for technical support for the JWCC engineering program office.

As for the current iteration of the contract, which DoD awarded in November 2021, Stephenson said the use by the services continues to grow.

“In 2025, had over $3.9 billion in total orders. We are actively seeing increases as the Air Force onboards to the contract now,” he said. “We had large Army orders last year, so it is continuing to see progress.”

Aside from JWCC-Next, DISA J-9 is busy implementing several large scale technology programs. Stephenson said the joint operational environment is operational in multiple theaters with active workloads, including the Indo-Pacific Command. Through JOE, DISA is bringing commercial cloud services to commands located outside the continental United States.

Meanwhile, DISA’s Olympus, which is its infrastructure-as-code initiative, is active in two environments, AWS and Microsoft, and military services and agencies can take advantage of the tools through DISA’s working capital fund.

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