Bipartisan letter urges appropriators to boost DIU's budget

By Briana Reilly / November 17, 2022 at 3:22 PM

Two lawmakers are calling on appropriators to pump more money into the Defense Innovation Unit's fiscal year 2023 budget, lamenting the "chronically under-resourced" state of the outfit that aims to leverage commercial technologies for military use.

Sent to leaders of the House and Senate defense appropriations panels this week, the letter -- from Rep. Mike Gallagher (R-WI) and Sen. Jon Ossoff (D-GA) -- makes the case for a $39 million total increase to DIU, a sum that would represent a nearly 44% funding jump for the small-budget unit.

Most of the requested boost -- $22 million -- would go toward supporting core programming for the unit, which the Nov. 14 letter states “will enable DIU to fulfill its mission of facilitating the rapid adoption of commercial technology to meet critical national security needs.”

“Enhanced resources could play a critical role in expanding DIU in the coming years, including through new regional offices across the U.S.,” says the letter, a copy of which was provided to Inside Defense. “These field offices could focus on areas capable of facilitating innovation due to proximity to vibrant commercial partners, world-class research institutions, and critical national security capabilities and military installations.”

DIU earlier this year opened a new satellite office in Chicago, marking the organization's fifth outpost and first in the Midwest. The $22 million increase Gallagher and Ossoff are advocating for would bring core programming funding up to nearly $50 million from the almost $28 million included in the Defense Department’s request.

Meanwhile, the letter seeks to double funding for the recently stood-up National Security Innovation Capital program, which aims to provide funding for early-stage hardware start-ups developing dual-use products.

Housed under the DIU umbrella, NSIC has been operating for about a year and a half and has received a total of $20 million in funding over that period, according to a DIU budget breakdown previously shared with Inside Defense, which shows the effort got $15 million in FY-21 and $5 million in FY-22. The FY-23 budget request included around $15 million for NSIC.

Gallagher and Ossoff want to see another $15 million added to the program, in addition to $2 million more specifically earmarked for NSIC operations and maintenance funding, which the letter states “would better support US technology competitiveness.”

An NSIC fact sheet provided to Inside Defense this week shows the program has awarded funding for 12 companies since its inception, with contracts ranging from $600,000 to $3 million, on top of receiving nearly 240 submissions. The award winners are working on developments in areas ranging from batteries to space manufacturing, optical communications and metal foams, according to the fact sheet.

“Originally authorized at $75M per year, NSIC’s impact in supporting these domestic, high-tech companies developing critical technologies is limited only by its appropriated funding,” the letter states.

Congress has not yet passed its FY-23 budget, with the government operating under a stopgap continuing resolution set to expire Dec. 16.