How the Byrd Rule Affects DoD Reconciliation Spending 

The Byrd Bath is Over: It’s Time for DoD to Spend Smart

The Department of Defense (DoD) is entering a critical moment of opportunity. Thanks to recent developments in the budget reconciliation process, billions of dollars in reconciliation legislation are about to be unlocked. These funds, part of the 2025 reconciliation package, will shape defense capabilities for years to come. But with almost no congressional guardrails, where this money flows depends heavily on interpretation, influence, and strategic alignment. 

And it all starts with something called the Byrd Rule. 

What Is the Byrd Rule and the Byrd Bath? 

The Byrd Rule is a provision of the Congressional Budget Act of 1974 that prohibits extraneous matters in budget reconciliation bills. It was introduced by Senator Robert Byrd to keep non-budgetary language out of reconciliation instructions used to pass major spending or tax legislation through the Senate with a simple majority. 

When a provision is deemed unrelated to direct federal spending or federal revenue, it’s stripped from the bill through what staffers jokingly refer to as a Byrd Bath. This process is governed by the Senate Budget Committee and reviewed by the parliamentarian. 

In this case, Congress attempted to insert a clause requiring DoD to submit a spending plan before expending reconciliation funds. The Byrd Rule removed that requirement. Why? Because requiring a plan isn’t considered a direct budgetary effect under the Byrd test. 

The result: A flood of reconciliation funding with no spending oversight, no budget resolution guardrails, and no accountability requirements. 

What Are Reconciliation Dollars? 

Reconciliation is a fast-track legislative process that modifies existing laws related to mandatory spending, taxes, or the debt limit. It stems from reconciliation instructions included in the budget resolution and has been used for major legislation like the Affordable Care Act, the Tax Cuts and Jobs Act, and the Inflation Reduction Act. 

Unlike traditional appropriations bills, a reconciliation measure must directly impact the budget. That’s why it can pass with a simple Senate majority, sidestepping the filibuster. But it also means every line item must meet strict criteria—leading to vague but legally binding allocations like: 

• $400 million for Joint Fires Network and battle management [source: GovWin] 

• $124 million for AI-enabled infrastructure [source: GovWin] 

• $12 billion for Pacific Deterrence Initiative [source: Senate Budget Summary] 

• $150 billion total increase to the federal budget for defense [source: GovWin] 

This money isn’t tied to specific programs or outcomes. It’s labeled in general categories like “secure facilities” or “mesh networks.” Once the reconciliation bill is signed into law, the Defense Department can execute funding immediately. 

Why the Byrd Rule Creates Strategic Risk 

The removal of the spend plan provision during the Byrd Bath means DoD must now decide how to spend without legislative guidance. For officials trying to avoid political fallout, that’s risky. 

Without detailed policy in the Senate bill, House bill, or committee markup, DoD is on its own—and open to scrutiny. If funding is misaligned with congressional intent, DoD leaders may face consequences during future hearings or under tools like the REINS Act or the Congressional Review Act. 

To minimize risk, program managers are likely to prioritize: 

• Programs with previous congressional adds or line items 

• Companies awarded funding through efforts like APFIT 

• Capabilities that match vague categories in the reconciliation legislation 

This is about deficit reduction and strategic clarity—not guesswork. 

How Should DoD Spend Reconciliation Funding? 

With billions in unstructured, discretionary funding now unlocked, DoD program officers face a challenge: how to spend responsibly in a way that aligns with congressional priorities and withstands future scrutiny. 

Here’s a simple framework: 

1. Follow Congressional Breadcrumbs 

Prioritize programs and technologies mentioned in past appropriations, reconciliation text, or strategy documents. 

2. Avoid Unproven Vendors 

Stick with firms that have already received support through programs like APFIT, or are referenced in House/Senate engagement. 

3. Pick Strategic Capabilities 

Invest in enablers of CJADC2, Joint Fires, Indo-Pacific operations, and hardened infrastructure—all areas explicitly or implicitly named. 

4. Choose Low-Risk, High-Readiness Solutions 

Can this be deployed now? Does it fill a documented gap? Go with what’s field-ready. 

Safe Spend Categories for DoD 

Reconciliation Category	Why It’s Safe to Fund	CenCore Fit
Joint Fires Network ($400M)	Named in reconciliation bill	Yes
Indo-Pacific Infrastructure ($12B)	Aligned with Pacific Deterrence Initiative	Yes
Secure Facilities for Industrial Base	General language matches SCIF/infrastructure	Yes
AI-Enabled Mission Networks ($124M)	Direct support for C2, network fusion	Partial
Mesh Network Communications ($300M est)	Broad scope for secure tactical connectivity	Yes

How Congress Signals Intent (Even When the Bill Is Vague) 

While reconciliation funds lack specific restrictions, congressional committees have left clues: 

• APFIT awardees 

• Funding in the FY26 budget resolution 

• Mentions in the Congressional Budget Office (CBO) analysis 

• Prioritization of capabilities like CJADC2, secure communications, and hardened infrastructure in the American Rescue Plan Act and the Rescue Plan Act 

Even vague line items in a reconciliation bill can align with past policy. And that gives DoD a logical framework. 

Why CenCore Is a Strategic, Low-Risk Choice 

In this climate, discretionary spending decisions must be made carefully. DoD needs mission-aligned, congressionally endorsed partners who reduce risk and increase capability. 

CenCore stands out because: 

• We received an APFIT award from the Marine Corps 

• Our technology supports funded areas like Joint Fires Network, mission networks, and Indo-PACOM infrastructure 

• We deliver hardened, mobile, dual-accredited systems for secure communications and command-and-control environments 

• Our solutions directly address priorities in the reconciliation process 

We are the connective tissue for programs that are already congressionally aligned. 

Article Recap: Key Takeaways and Quick Answers 

• What is the Byrd Rule? 
  • A Senate rule that strips non-budgetary items from budget reconciliation bills. 
• What is a Byrd Bath? 
  • The process of reviewing and removing provisions that don’t affect the federal budget under reconciliation. 
• What does this have to do with DoD? 
  • Congress tried to insert spending plan requirements, but they were removed during the Byrd Bath. Now DoD can spend billions with little oversight. 
• What programs receive reconciliation funding? 
  • Joint Fires Network, AI infrastructure, Pacific Deterrence, secure facilities, mission networks. 
• How should DoD spend it? 
  • Follow congressional intent, support field-ready programs, and prioritize documented capability gaps. 
• Why is CenCore relevant? 
  • We align with congressional intent and offer ready-to-deploy solutions for the types of infrastructure and capabilities funded by the 2025 reconciliation package. 

Final Thought: The Clock Is Ticking 

If you’re interested in understanding how our solutions align with reconciliation funding categories or want to explore which CenCore product fits your mission needs, reach out to our team at info@cencoregroup.com. We’d be happy to walk you through the options.

This is not just another fiscal year. This is a defining moment in how America directs its discretionary and mandatory spending toward national defense.

CenCore is ready—technically, operationally, and politically.

---

About CenCore  

Headquartered in Springville, UT, CenCore is a trusted partner in delivering innovative security solutions in an ever-evolving threat landscape. CenCore delivers U.S.-made, tech-agnostic, open-source security systems that ensure global secure communications. CenCore prioritizes cost-effective, high-performance solutions over superficial appeal.