Gallagher Advances Agenda to Accelerate Near-Term Defense Technology

Through this year’s National Defense Authorization Act, the House Armed Services Committee is working to pass measures to reduce the time it takes the Department of Defense to adopt new technologies. Congress has been trying to accelerate defense technology transitions for years, but this latest campaign has a fresh champion in Rep. Mike Gallagher (R-WI), the new chair of the committee’s subcommittee on innovation policy and an emerging advocate for addressing near-term technology needs.

Gallagher has expressed frustration that the military typically only deploys new equipment years after the need for it is identified and its efficacy is demonstrated. This week, his subcommittee advanced draft proposals to keep tabs on how DOD balances long-term and short-term R&D and to reform the position of under secretary of defense for research and engineering to increase its focus on leveraging commercial technologies. The full committee will add further measures when it assembles its entire draft of the NDAA during a meeting next week.

Thinking shifting around R&D time horizons

Congress passes an NDAA every year to update U.S. defense policy. Because it is one of the few bills essentially guaranteed to become law, it always attracts large numbers of proposed provisions, starting with drafts from the House and Senate Armed Services Committees. The great majority of proposals are minor ones, which have a good chance of being retained during negotiations between the House and Senate to finalize the bill.

However, even ostensibly minor proposals often reflect a larger agenda and set the stage for stronger measures in future years. Such may be the case with the provision to track the balance between long-term and short-term R&D, which would require only that DOD submit an annual report to Congress on its allocation of funding to R&D projects that are “incremental” and “transformational.” These terms are respectively defined by whether a project is expected to “achieve initial operational capability” in less or more than five years.

Yet, while the provision is itself modest, the subcommittee’s accompanying report further clarifies that committee members are “concerned” about the balance of DOD’s portfolio. It cites Russia’s war against Ukraine and the danger of China attacking Taiwan as illustrative of the unpredictability surrounding “when and where the Department of Defense’s capabilities and technology will be needed.”

The position represents a potentially important change of emphasis. Both DOD and Congress have pointed to strategic competition with China and Russia as motivating a shift in focus away from immediate military needs in favor of accelerating transformational capabilities to counter sophisticated threats on the horizon. While Russia and China are still the central concern for Gallagher, his focus is on technologies that might be needed more urgently than previously envisioned.

Gallagher seeks stronger push on commercial technology

“With storm clouds gathering in both the Indo-Pacific and Europe, commanders need capabilities that can be fielded now — not in a decade,” Gallagher argued in an article last September. Outlining some of his thinking on the issue, he called particularly for greater DOD engagement with the commercial sector, suggesting the department should expand its adoption of commercial technologies by an “order of magnitude.”

“Dual-use technologies offer solutions that can be in the hands of our men and women downrange in just one or two years,” he explained.

Such concerns underpin his subcommittee’s proposal to reform the position of the under secretary of defense for research and engineering. Congress established the role in 2016 to elevate its activities out of DOD’s acquisition bureaucracy and free them from unduly rigid contracting requirements. Now, the position would be renamed the under secretary of defense for “technology integration and innovation” and accessing commercially developed technologies would be embedded in statute as one of its primary responsibilities.

Accordingly, holders of the renamed position would also be newly required to have experience in “private or venture capital, commercial, or prototype-to-production transition.” However, the provision specifies the incumbent would not need to step down or be renominated when the reform is implemented.

In his September article, Gallagher acknowledged recent DOD initiatives to engage commercial businesses but also criticized the department for focusing its efforts on the Small Business Innovation Research program, which now receives about $2 billion in annual funding from the department.

“The problem is that while SBIR funding can help the department meet niche defense needs, it is a poor fit for fostering innovation at scale. With tranches of grants usually totaling a little over $1 million, SBIR funding tends to be spread too thin across too many recipients. The result is that only about 10% of SBIR-funded companies ultimately end up producing new warfighting capabilities,” he argued.

As a better model, Gallagher pointed to DOD’s Defense Innovation Unit and Special Operations Command, which he suggested have appropriate authorities to identify and contract for commercial technologies that solve pressing military problems.

One of his subcommittee’s draft provisions would require that DIU report directly to the secretary of defense and that DOD perform an assessment to ensure it has an appropriately large staff. DIU reported to the secretary for a period shortly after DOD created it in 2015 and, as of this April, it now does so again, but in between it reported to the under secretary of defense for research and engineering.

While it reported to the under secretary, DIU struggled to build up a budget, prompting its director Michael Brown to complain ahead of his resignation last fall that the unit was neglected and losing staff members to other offices. Gallagher subsequently advocated with Sen. Jon Ossoff (D-GA) that it receive a major funding boost and Congress ultimately exceeded the amount they sought, providing it with $112 million in the current fiscal year.

Interest in technology transition reform still on upswing

Additional provisions bearing on technology transition will be added to the House draft of the NDAA at next week’s full committee meeting.

One would require the three military service departments to each appoint a “principal transition adviser” who would report directly to the department secretary and identify technologies under development relevant to military requirements.

Another provision would require each of the departments to annually designate at least five projects undertaken through SBIR or the Small Business Technology Transfer program as “entrepreneurial innovation projects” for immediate transition into DOD’s management process for technology maturation.

Three other provisions would create five-year pilot programs granting special authorities for the Army, Air Force, and Navy to issue funding awards for technology transition projects worth up to $10 million each.

Additional related provisions could also be introduced as amendments during the meeting.

All this year’s moves on technology transition will lay groundwork for what is likely to be a larger debate on the subject next year, when a congressionally created commission will recommend changes to DOD’s longstanding Planning, Programming, Budgeting, and Execution framework. Critics argue the framework is too rigid to accommodate quick decisions, and significant reforms to it could fundamentally change how DOD manages its technology portfolio.