Pentagon seeks $5.4B funding shuffle for missile shortages, workforce cuts, and Air Force One delays

Defense One’s Audrey Decker covers DOD’s pressure on Congress to authorize a $5.4 billion reallocation of previously approved funds, aiming to accelerate high profile military programs and address acute resource gaps exposed by recent global crises.

A quarter of the US’s stockpile of Terminal High Altitude Area Defense (THAAD) interceptors was expended during the twelve-day Israel-Iran conflict in June, leaving inventories at uncomfortably low levels. With production lagging well behind demand—last year, only eleven new interceptors were procured—the Pentagon’s latest request would inject over $500 million to ramp up manufacturing and redesign efforts, targeting not only replenishment but future-proofing for the so-called Golden Dome.

Another $150 million is earmarked to expedite delivery of two new VC-25B presidential jets by up to two years, moving the projected handover to 2027. Concurrently, the Air Force is redirecting “early-to-need” Sentinel ICBM funds to retrofit a Boeing 747 previously owned by the Qatari royal family, to serve as a temporary Air Force One. This swift move is a direct response to delays and persistent cost overruns in the existing aircraft program.

The omnibus request also reallocates resources for new efforts such as the Army’s Common Autonomous Multi-Domain Launcher, while axing or deferring funding from outdated or underperforming programs—including the M-10 Booker tank and unused equipment, as mandated by recent reform initiatives.

Under defense workforce reforms, hundreds of millions will cover retention expenses as DOD implements its Deferred Resignation Program—paying over 154,000 federal workers not to work through September, a controversial tactic to shrink the civilian workforce faster than ever before.