Full Funding Policy
DAU GLOSSARY DEFINITION
1. The practice of funding the total cost of major procurement and construction projects in the Fiscal Year in which they will be initiated. The policy requires the total estimated cost of a complete, military usable end item or construction project funded in the year in which the item is procured. If a future year's appropriation is required for delivery of an end item, the end item is not fully funded. It prevents funding programs incrementally and provides a disciplined approach for Program Managers to execute their programs within cost. 2. A DoDI 5000.02 requirement for program initiation of an acquisition program. Full funding means having the dollars and manpower needed for all current and future efforts to carry out the acquisition strategy in the budget and out-years of the Future Years Defense Program as one of the criteria for the transition. For all acquisition programs, the MDA normally assesses full funding at all major decision points.
DoD Instruction 5000.02 requires that at the Milestone A, B, and C reviews, and for the Full-Rate Production Decision or Full Deployment Decision review, the DoD component must fully fund the program to the component cost position in the current Future Years Defense Plan (FYDP), or commit to full funding of the cost position in the next FYDP, with identification of specific offsets to address any funding shortfalls that may exist in the current FYDP. Full funding means having a current and projected resource stream to execute the acquisition program, i.e., program funding and manpower is included both in the budget and in the out-years of the FYDP sufficient to cover the current and future efforts described in the acquisition strategy.
DoD Instruction 5000.02 requires that at the Milestone A, B, and C reviews, and for the Full-Rate Production Decision or Full Deployment Decision review, the DoD component must fully fund the program to the component cost position in the current FYDP, or commit to full funding of the cost position in the next FYDP, with identification of specific offsets to address any funding shortfalls that may exist in the current FYDP. The component acquisition executive (CAE) and the component chief financial officer (CFO) must endorse and certify in the Full Funding Certification Memorandum that the FYDP fully funds, or will fully fund, the program consistent with the component cost position. For joint programs, the lead component or executive agent will prepare the component cost estimate and all components involved must either jointly sign or individually submit a component cost position and Full Funding Certification Memorandum.
The FYDP is a computerized database that captures and summarizes forces, resources, and programs associated with all Department of Defense (DOD) operations approved by the Secretary of Defense (SECDEF). The FYDP is structured in three basic dimensions - the organizations affected (military departments and defense agencies), Appropriation accounts (Research, Development, Test and Evaluation (RDT&E), Operation and Maintenance (O&M), etc.), and Major Force Program (strategic forces, mobility forces, R&D, etc.). The FYDP allows a “crosswalk” between DoD’s internal system of accounting via 11 major programs and congressional appropriations. The primary data element in the FYDP is the Program Element (PE).
The FYDP is updated twice during the Planning, Programming, Budgeting and Execution (PPBE) cycle: upon submission of the Program Objective Memorandum (POM), and submission of the President’s Budget (PB).