The United States Army is the largest branch of the Armed Forces. The service has an extensive array of intelligence, personnel, and weapons to ensure land dominance across the homeland, territories, and overseas interests. Having vast resources means Army spending takes a considerable amount compared to other branches of the Department of Defense (DoD).
Budget FY2023: How much is available for Army spending?
The Army is allocated 20.3% of the $1.8 trillion total budgetary resources of the Department of Defense for the fiscal year 2023 (FY2023). The military component has the second-highest allocation of the DoD FY2023 at nearly $366 billion, ranking after only defense-wide commitments of the defense department amounting to $784 billion.
A comprehensive breakdown of the DoD’s budget for FY2023:
- Defense-wide – $783.6 B (43.5%)
- Army – $365.9 B (20.3%)
- Air Force – $322.4 B (17.9%)
- Navy and Marine Corps – $318.5 B (17.7%)
- International Security Assistance – $9.7 B (0.5%)
- Military Sales Program – $967.8 M (0.1%)
Budget Materials: Where does the Army spend its budget?
As the largest service branch, the Army, including the Army National Guard and the Army Reserve, supports over 35 federal accounts or budget materials. Most of these federal accounts can be divided into five primary categories: (1) Research, Development, Test, and Evaluation; (2) Operation and Maintenance; (3) Military Personnel; (4) Military Construction; and (5) Procurement of Weapons and Systems.
Research, Development, Test, and Evaluation
- Total Budgetary Resources: $104 Billion
- Total Obligations: $24.5 Billion (23.5% obligated from total budget)
- Total Outlays: $33.4 Billion (138.4% fulfilled)
At approximately $104 billion, Research, Development, Test, and Evaluation (RDT&E) accounts for 28.4% of the Army spending for FY2023. It pays for the service branch’s various research and development efforts toward creating new weapons and systems. A share of the RDT&E funding also goes toward testing and evaluating these new capabilities.
Operation and Maintenance
- Total Budgetary Resources: $99.6 Billion
- Total Obligations: $78.1 Billion (78.3% obligated from total budget)
- Total Outlays: $71.9 Billion (92.1% fulfilled)
The Army appropriates $99.6 billion for the Operation and Maintenance. The activity receives 27.7% of the service branch’s FY2023 funding for operating and maintaining weapons, artillery, vehicles, uniforms, armor, and military bases. The budget also covers preparing, training, and upskilling personnel for the Army equipment.
- Total Budgetary Resources: $70.2 Billion
- Total Obligations: $62.9 Billion (89.5% obligated from total budget)
- Total Outlays: $58 Billion (92.1% fulfilled)
Boasting a global network of operations, the Army has nearly a million uniformed soldiers, including personnel from the National Guard and Army Reserve and over 330,000 civilian staff. Compensating these personnel accounts for 19.2%, amounting to $70.2 billion. On top of payments, retirement, and social benefits are included in the Military Personnel budget allocation.
Procurement of Weapons and Systems
- Total Budgetary Resources: $62.5 Billion
- Total Obligations: $34.2 Billion (54.7% obligated from total budget)
- Total Outlays: $22.6 Billion (66.4% fulfilled)
To ensure land dominance of the U.S. across all fronts, the Army procures contracts with government contractors to manufacture, maintain, and upgrade weapons and systems. For FY2023, the service branch allocates 17.1% of its budget, or $62.5 billion, for purchasing the newest equipment, ammunition, vehicles, aircraft, technologies, and solutions.
- Total Budgetary Resources: $21 Billion
- Total Obligations: $6.4 Billion (30.4% obligated from total budget)
- Total Outlays: $5.6 Billion (87.5% fulfilled)
The construction, management, maintenance, and design of Army installations and facilities can quickly add up. One of the primary allocations for the $21 billion budget is for the Army bases worldwide, but a considerable portion also supplies funding for the construction of family housing and cemeteries. Military construction accounts for 5.7% of the Army budget in FY2023.
Other budget materials
- Total Budgetary Resources: $8.6 Billion
- Total Obligations: $5.1 Billion (59.5% obligated from total budget)
- Total Outlays: $4.5Billion (87.3% fulfilled)
A slew of budget materials, amounting to $8.6 billion, account for 2.4% of the Army budget in FY2023. Accounts included in this category are funding for several interests, concessions, reservations, and programs of the Army. The budget also appropriates funding allocation for various authorities under the Department of the Army.
Obligations and Outlays: How does the Army spend its budget?
The United States Army uses its total budgetary resources to fund its commitments toward these federal accounts. These commitments can be classified into two categories:
- Obligations are financial promises bound by a contract, which outlines the Army’s duty to pay for its ordered or received products and services.
- Outlays are the transactions to fulfill the Army’s spending obligations, with the funding coming from budgetary resources and paid to the federal account.
For the FY2023 Army budget, total obligations sum up to $211.2 billion. Meanwhile, outlays tally to approximately $196.5 billion. The majority of the obligations have been paid, with only 7.5% of total federal accounts that haven’t been paid out yet. However, this may be due to the Army making outlays to meet its other obligations in previous fiscal years.
Award obligations: How much does the Army spend on government contracts?
The Department of the Army designates a portion of its budget to fulfill its award obligations to contractors and recipients. These awards are finalized in the form of federal contracts, contract IDVs, grants, loans, direct payments, and other financial assistance. Each award comprises a number of individual transactions where money is obligated.
The Army has made 116,327 transactions in FY2023—34,259 of which are new awards. These transactions total $81.4 billion in award obligations, second only to the Department of the Navy. It accounts for 23.2% of the total award obligations of the DoD for FY2023.
Spending Trends: How has Army spending changed over time?
The Army receives its funding from the Department of Defense, which receives its funding from Congress. During a five-year period, the service branch has experienced a steady increase in budget to meet its increasing total obligations. In 2023, obligations started to decline, while the total budgetary resources, which are supposed to be spent on obligations, started to inflate.
Amid the increasing global conflicts in major theaters, the Army continues procuring, developing, and upgrading equipment, installations, weapons, and systems to assert land across the U.S., allies, and partners. The Army is constantly improving its capabilities, reflected in its upward spending trends for budgetary resources and obligations throughout the years.
Army Spending: What does this mean for your tax dollars?
Most federal government funding comes from tax dollars; the Army budget is no exception. As a huge chunk of taxes goes into national defense, the public should have an assurance that their homes, places of work, properties, and assets are protected against potential threats. It’s for this reason that all Americans should keep an eye on Army spending, budget, and obligations.
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