Shipbuilding accounts vulnerable to budget woes.

• Position: Budget Matters

* Extended budget freezes would hit Navy shipbuilding accounts particularly hard, according to a September report by the Congressional Research Service.

If Congress persists in funding the Defense Department through continuing resolutions, it would freeze shipbuilding money at fiscal year 2015 levels--about $16 billion. For fiscal year 2016, the Pentagon requested $16.6 billion.

Continuing resolutions complicate procurement for all the services by prohibiting new program starts, procurement quantity increases and the signing of new multiyear procurement contracts.

But they are especially problematic for Navy shipbuilding--known in budget circles as Shipbuilding and Conversion, Navy (SCN)--because those programs are funded at the line-item level rather than the account level like other Defense Department acquisitions, noted the CRS report titled, "Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress."

"This can lead to line-by-line misalignments (excesses and shortfalls) in funding for SCN-funding programs, compared to the amounts those programs received in the prior year," the report said, adding that the restrictions could also force the Navy to divide contracts into multiple actions, potentially increasing the final price tag by reducing economies of scale and boosting administrative costs.

According to a Navy paper provided to the research organization in September, a full-year continuing resolution in fiscal year 2016...