Army Adds New Funding Classification to Bridge Valley of Death for UAS, C-UAS, and Electronic Warfare
(July 1, 2025)
On June 25, the FY26 Presidential Budget Request was released, and the available funding lines revealed a key development in classifying the maturity of project groups. While full numbers across the Department of Defense (DoD) are not yet available, the Army has released its budget and introduced a significant change in the RDT&E (Research, Development, Test, and Evaluation) Budget Activity (BA) classification system—a new BA titled “AGILE RDT&E Portfolio Management.” This addition demonstrates that the DoD wants rapid implementation just as much as it wants innovation.
What Is a Budget Activity and Why Introducing a New One Matters
The Budget Activity (BA) classification system shows how far along RDT&E program elements are in the development process. On a scale, lower BAs denote basic research, while higher BAs represent more operational stages ready for deployment.
Up until FY26, there have been eight BA categories:
Budget Activity (BA) Categories:
As depicted above, a ninth activity has been added- “AGILE RDT&E Portfolio Management.” This ninth classification can be interpreted as a demand signal for expedited development and adoption of innovative technology. Emphasis on higher level BAs indicates an effort to actively field and adopt technology, as higher BAs indicate increased operational readiness. This is a relevant trend for those interested in escaping the valley of death and bridging the gap between development and procurement. With the introduction of the ninth BA, the DoD is aligning funding mechanisms with messaging to address this challenge.
How the Ninth Budget Activity Relates to the Army
Within the Army, the arrival of the “AGILE RDT&E Portfolio Management” BA indicates increased attention to Army modernization, and is related to the Army Transformation in Contact Initiative (TiC).
The TiC initiative aims to rapidly bring innovative tech to soldiers and the modern battlefield, and is directly related to late stage prototyping and adoption. Launched in 2024, TiC has adopted a user-driven approach instead of a lab-based one, allowing innovators to field tech with operational units, receive feedback, and quickly iterate to meet battlefield needs. To deliver on its mission, TiC employs agile funding, a mechanism that enables rapid development and acquisition by allocating funding to capability portfolios, rather than restricting funding to specific line items.
Although agile funding is not a new concept, its addition to the BA classification system and injection of funding are significant because they funnel money into three core capability areas:
- Unmanned Aerial Systems (UAS)- $360 million
- Counter Unmanned Aerial Systems (C-UAS)- $143 million
- Electronic Warfare (EW)- $186 million
The combined FY26 BA9 funding across the three portfolio areas exceeds $690 million in RDT&E, creating new opportunities for stakeholders and serving as a catalyst for accelerated Army technology adoption. The next section will outline identified PEOs and programs expected to receive funding, highlighting areas where interested parties may have the potential to engage and collaborate through BA9 funding.
Budget Activity Nine (RDT&E)- Funding, PEOs, and Programs
- Unmanned Aerial Systems (UAS) efforts receive the highest funding among all portfolios, exceeding $360 million.
- Among Program Executive Offices (PEOs), the top recipients are:
- Aviation ($169 million)
- Intelligence, Electronic Warfare & Sensors ($131 million)
- Among programs, the top recipients are:
- Air Launched Effects ($169 million)
- Terrestrial Layer System ($114 million)
Budget Activity Nine (RDT&E)- FY26 Program Elements
- Counter Unmanned Aerial Systems (C-UAS) Agile Development
- Electronic Warfare Agile Development
- Electronic Warfare Agile Systems Development
- Unmanned Aerial Systems Launched Effects Agile Systems Development
- UAS Launched Effects Agile Development
Want to explore BA9 in more detail and see where FY26 funding is being allocated across the DoD? Sign up for the Obviant platform to gain deeper insight!
