Software Acquisition and the Color of Money

Abstract

The current DoD acquisition budgeting process provides funding visibility to Congress for hardware-intensive systems from requirement generation to ultimate disposal. Unfortunately, a square peg in a round hole quandary has occurred with a funding miss-match as modern software-intensive systems are required to comply with traditional funding appropriation breakout categories (aka colors of money). The 2019 Defense Innovation Board (DIB) SWAP report identified the funding challenges of continuous software development and stated, “Colors of money doom software projects.” In the FY20 National Defense Authorization Act, Congress created a pilot program with a new appropriation category for software-intensive DoD programs (BA-8). The challenge to the DoD is to prove via quantifiable metrics that a single appropriation of funds enables speed-to-capability deliveries in the software pilots. Other contributing factors made it difficult to discern the effects of BA-8, as revealed by the pilot program metrics, which highlighted potential future study areas. Regulations and policies regarding funding that do not consider the continuous delivery of software capability to the user after the fielding event milestone can lead to confusion about the appropriate appropriations to use and their timing.