American Defense International, Inc. Matt Weinstein – 21 September 2016

1. An Overview of the Congressional Budget Process American Defense International, Inc. Matt Weinstein – 21 September 2016

2. Agenda • Regular Order vs. Reality • Current Budget Environment • Defense Spending Trends • Budget Control Act & Sequestration • FY17 Federal R&D Priorities • The Florida Delegation • When to Engage • How to be Effective • Current Political Landscape • Legislative Snapshot • Summary

3. Regular Order vs. Reality Regular Order **Title III of the Congressional Budget Act establishes a specific timetable for the congressional budget process.

4. Regular Order vs. Reality Reality

5. Current Budget Environment

6. Current Budget Environment

7. Current Budget Environment Sequestration vs Budget Control Act • The 2011 Budget Control Act imposed $487B in DOD cuts over 10 years that have been and will continue to be implemented. • Sequestration describes automatic, “across the board” cuts only required when Congress approves funding levels above the 2011 Budget Control Act caps. • OCO budgets are “off budget” and therefore not subject to sequestration • “Ryan-Murray” Budget Agreement 2013 provided relief from Budget Control Act limits but extended implementation through 2023. • Bipartisan Budget Agreement (BBA) 2015 added $25B to FY16 ($548.1B) & FY17 ($551.1B) cap but reduced OCO to $58.8B ($606.9B total) and extends BCA through 2025. • FY17 budget request is below BBA limits = sequester not triggered • However, FY17 budget removed $18B of base requirements requested under OCO creating a significant readiness strain on DOD; Congressional republicans want to restore the money while democrats want an equal increase in social spending.

8. FY17 Federal R&D Priorities

9. The Florida Delegation • The Florida Delegation is composed of 27 Representatives and two statewide Senators (Sen’s. Nelson and Rubio) • FAU’s geographic footprint rests in or around five congressional districts: • Seatech & Davie Campuses – Rep. Debbie Wasserman-Schultz (D-FL-23) • Fort Lauderdale & Boca Raton Campuses – Rep. Lois Frankel (D-FL-22) • Rep. Alcee Hastings (D-FL-20) is adjacent to the Fort Lauderdale Campus • Rep. Ted Deutch (D-FL-21) is adjacent to the Boca Raton Campus • Harbor Branch & Jupiter Campuses – Rep. Patrick Murphy (D-FL-18) • Additionally, Rep. Tom Rooney (R-FL-17) has assisted FAU on congressional matters in the past • Aquaculture language in FY17 Agriculture Appropriations Report and cyber security efforts through the Intel Committee

10. The Florida Delegation

11. When to Engage • Appropriations vs. Authorizations • Defense • Other Authorizations: • Surface Transportation, Farm Bill • Universities can influence an outcome throughout the Legislative process • Committee Mark • Floor Action • Conference Committee

12. How to be Effective • Identify a requirement for your research • Brief government agencies (Program Office) • Gain government champion/Determine funding opportunities • If no funding is available, funds must be appropriated in the following year’s budget • Engage Congress at the right time – The annual appropriations process starts on the first Monday in February every year when the President’s budget is released • Language can be inserted into Bills and Reports to influence Agency spending • REMEMBER: There are NO Earmarks • Once funding is available, the contracting phase can begin!

13. Current Political Landscape • Congress • House of Representatives (435 Members): Republicans increased their majority in the House after picking up 13 seats in 2014 and hold a 246-188 advantage—the magic number in the House is 218 for a majority. House terms run for two years so each member is up for re-election every election cycle. • Senate (100 Members): Republicans have a majority in the United States Senate by a 54-46 margin (2 Independent)—the magic number in the Senate is 60. Approximately 1/3 of the Senate is re-elected each election cycle, this time there are 24 Republicans and 10 Democrats in cycle. • White House: • Both major party candidates are extremely unpopular • There will be an impact on “down ballot” candidates for Congress • Third-party candidates (Libertarian and Green) could affect outcome • First presidential debate is 26 September • Supreme Court: • Unexpected vacancy will impact 2016 elections Countdown Clock: Only 48 days remain until the election…

14. Legislative Snapshot • Appropriations: • The Senate is currently debating a three month Continuing Resolution (CR) • The CR will keep the government funded until 9 Dec and will include the following: • A 0.06% across the board reduction to meet the budget caps • $1.1B to combat the Zikavirus(controversy over Planned Parenthood appears to be averted) • The conferenced FY17 Military Construction and Veterans Affairs Appropriations Bill • Emergency funding for flood victims in Louisiana • The House will take up the CR next • Conservatives in the House prefer a six month CR to avoid the “Lame Duck” • Leadership and Appropriators prefer to pass appropriations bills in Dec rather than kick the can • Outlook: • Congress will pass a short-term CR funding the government until 9 Dec • Congress will then recess until after the 8 Nov election • Congressional “Lame Duck” session will need to address: • National Defense Authorization • Long-term appropriations bill(s)

15. Summary • There is an annual process that Congress follows to authorize spending and set spending limits for the Federal government • Effectively engaging the Agencies and the Congress at the right time will significantly increase your odds of success • A political outcome may not always be necessary, but when it is, it’s good to have already laid the foundation • U.S. Representatives and Senators serve their constituents first and foremost • Increasing your footprint by teaming with other universities or businesses can significantly increase your odds of a successful award • There are NO Earmarks • When the Presidency changes, budget priorities often change “Democracy is contact sport…you have to make contact to win!”