President Joe Biden has said he will sign the National Defense Authorization Act, which sets the direction of military spending and policy for the next fiscal year but does not appropriate actual dollars. 

Senate Majority Leader Chuck Schumer (D-N.Y.) said shortly after the 87-13 vote on Dec. 13 that passage of the final conference report on the bill was made possible through “the good work done by both sides." He said the bill "contains many of the most important, bipartisan provisions we had in the Senate’s original bill.” 

The final bill represents a compromise between Democrats and hard-line Republicans who sought to roll back several Biden administration initiatives related to addressing climate change, as well as diversity and inclusion initiatives at Defense Dept. facilities. The final bill eliminates a greenhouse gas emissions reporting requirement for agency contractors—but also jettisons measures in the original House-passed bill to defund all Biden administration orders related to climate and social justice.

The approved spending bill retained additional authorizations for funding to address contamination from the chemical substances collectively known as PFAS at U.S. military sites. Among those are funding for a pilot program to offer prizes for technological innovations in PFAS thermal destruction and requirements that DOD publish regular updates and cost estimates about planned contaminant remediation projects. 

The final package also includes a provision to allow the department to modify contracts based on inflation and fluctuating economic conditions, and to increase the cap on DOD consulting fees from 6% to 10%.

Military Construction 

The 2024 spending legislation authorizes a total $18.2 billion for military construction, family housing and base realignment and closure projects. The largest piece—$5.3 billion—is set to go toward more than 60 U.S. Navy projects. Another $3.2 billion will fund U.S. Air Force projects and $1.9 billion is set for U.S. Army projects. The bill also includes $3.2 billion for department-wide projects and $1.7 billion for various National Guard and Reserve projects. 

The largest authorization amount for a single construction project is $1.3 billion for a dry dock replacement at Joint Base Pearl Harbor-Hickam in Hawaii. The Navy awarded a $2.8-billion firm-fixed-price task order this year to a joint venture of Dragados USA, Hawaiian Dredging Construction Co. and Orion Government Services LLC for the project, with plans to fund work incrementally through fiscal 2026. 

The bill also extends the Pacific Deterrence Initiative, which was included in the 2023 authorization bill, to meet the “pacing challenge” presented by China’s efforts to exert greater military pressure in the Indo-Pacific region. This year’s bill includes $2.3 billion for infrastructure improvements under the initiative. That is in addition to more than $4.6 billion authorized as part of other military construction across the region, such as the Pearl Harbor dry dock replacement plus other projects in Hawaii, Guam, California, Washington, the Mariana Islands and in other nations, including Australia, Japan, South Korea and the Philippines. 

Other large construction authorizations in the bill include $252 million for natural disaster recovery at Tyndall Air Force Base in Florida, which was seriously damaged by Hurricane Michael in 2018; $160 million for a B-21 nuclear weapons generation facility at Ellsworth Air Force Base in South Dakota, which is currently under construction by Walsh Federal LLC; and $105 million for an aircraft maintenance hangar project at Fort Riley in Kansas.

Looking Ahead

The authorization bill only authorizes and does not allocate actual funding, which is provided through annual appropriations bills. Only one spending bill—for military construction and veterans affairs—has cleared both chambers. 

With deadlines looming for the first set of bills covered under the latest continuing resolution expiring Jan. 19 and for the second group in early February, it is unclear what will happen next, says Associated General Contractors Vice President of Government Relations Jimmy Christianson. 

“There’s two things that need to be determined. One, what is the top line number and two, what are the priorities from both sides?" he notes. "It’s unclear what the answers are on those two questions at this point and where they're going to land.” 

Meanwhile, Senate Democrats are working with the White House to make progress on a supplemental spending bill that could pass both chambers and be signed by the president before the end of the year. “I hope it’s not just wishful thinking. I think there’s an earnest effort,” says Steve Hall, American Council of Engineering Cos. executive vice president. 

Hall notes that the supplemental appropriations package providing aid to Israel and Ukraine could be a vehicle for other measures that have bipartisan support but have not been able get across the finish line this year.

These include reauthorization of the Federal Aviation Administration and a long-sought-after change to a research and development tax credit for engineering firms.  “Unfortunately, Congress pushed a whole lot of unfinished business into January,” he says. “We still have got a lot of work to do.”