The new Space Force budget request omits funding for future tranches of the Space Development Agency’s data transport layer, teeing up a potential debate in Congress about the future of the organization and the service’s plan for managing both tactical and enterprise communication needs.
The Pentagon formally unveiled its fiscal 2027 budget April 21, and Maj. Gen. Frank Verdugo, deputy assistant secretary of the Air Force for budget, told reporters in a briefing that the Space Force’s budget request reflects its plan to shift SDA’s data transport mission into a new hybrid architecture called the Space Data Network.
Specifically, the request would move SDA data transport funding into a $1.5 billion procurement account called “Proliferated Low Earth Orbit.” It also includes a separate, nearly $1.5 billion research and development funding line for the Space Data Network.
Space Force officials haven’t spelled out the particulars of what programs will be encompassed in the Space Data Network but have said the intent is to meet the U.S. military’s space-based data transport needs through a hybrid network of commercial satellites and bespoke military spacecraft. The effort aims to combine both the secure, tactical communications that military users need as well as the high-throughput, low-latency capability that can push large amounts of data to users.
SDA’s transport layer was designed to address that first set of requirements, whereas a program called MILNET was intended to fulfill the second. Now, according to service officials, neither MILNET or SDA’s transport layer exist as originally envisioned and are instead part of the broader SDN.
The hybrid network is the outcome of a yearslong study of the service’s data transport architecture. Last summer, the Space Force cut funding and put future buys of SDA’s transport layer on hold while it finished its study—a move that drew criticism from some lawmakers who were concerned that the service would cancel the multivendor program in favor of MILNET, which is reportedly operating under a sole-source contract to SpaceX.
In a June 2025 Senate Armed Services Committee hearing, Sen. Chris Coons (D-Del.) argued that MILNET “has no competition, no open architecture, no leveraging a dynamic space ecosystem”—all qualities which SDA has tried to foster.
Ultimately, Congress added $50 million to SDA’s data transport budget “to maintain warfighter centric capabilities within the … architecture.”
Acquisition Shakeup
As the Space Force reworks its transport architecture, it is also rethinking both the form and function of its acquisition enterprise in response to Defense Secretary Pete Hegseth’s mandate that each of the military services organize and manage their acquisition teams by mission area portfolios rather than keep them stovepiped at the program level. As part of this effort, the Space Force will create nine portfolio acquisition executives, six of which have been announced:
- Space access, which includes launch and mobility
- Space-based sensing and targeting, which includes space domain awareness and data transport
- Missile warning and tracking
- Satellite communications and positioning, navigation, and timing
- Battle management command, control and intelligence
- Infrastructure, which includes data management as well as training, testing, and personnel
Space Force officials said during the annual Space Symposium last week in Colorado Springs, Colo., that as part of this reorganization, SDA’s transport and missile warning and tracking layers will likely move within these portfolios, as would the Space Rapid Capabilities Office’s programs, which are spread across many Space Force missions. However, those decisions have not been finalized.
At the same time, the service has yet to decide who will lead each PAE and which of its acquisition organizations will run which programs. SSC Commander Lt. Gen. Philip Garrant told reporters April 12 that SDA’s Acting Director Gurpartap Sandhoo will be named to lead the missile warning and tracking portfolio, which Breaking Defense reported earlier this month. Sandhoo later declined to confirm that decision.
“At some point, people will be named,” Sandhoo said April 13, adding that there is “goodness” in the decision to move programs with similar missions under a single portfolio acquisition executive.
These discussions have raised questions about the future of organizations like SDA and the Space Rapid Capabilities Office. Both were designed to disrupt status quo acquisition processes and deliver systems on faster timelines. But in the Pentagon’s new vision for defense acquisition, where all offices are agile and fast-moving, it’s not clear where standalone rapid acquisition offices fit.
“The way the SDA and the RCO have been structured, to be honest, those are kind of the models of how we’re actually going to structure all the PAEs,” Air Force Secretary Troy Meink told reporters April 13. “The goal is, pretty much the way SDA operates, most of the PAEs would be operating in a very similar fashion.”
Sandhoo hinted at the possibility of an even broader shakeup, saying he thinks it’s likely that in several years, none of the Space Force’s acquisition organizations will exist as they do today, but will instead be encompassed in a new organization. He didn’t elaborate.
“I don’t want to predict the future, but five years from now, probably, the names of the organizations will be different than what you see today,” he said. “There probably won’t be SDA, Space RCO, or SSC. There’ll be something else. What that ends up looking like is TBD.”
Congressional Buy-in
For now, adjusting or eliminating either SDA or the Space RCO would require congressional action, as both organizations are written into law. It’s not clear what the appetite in Congress would be for such a proposal, as lawmakers have largely been supportive of both offices.
Todd Harrison, a senior fellow at the American Enterprise Institute, said he thinks the plan the Space Force has laid out so far is a step in the right direction and that it likely makes sense to absorb SDA and the Space RCO into the larger ecosystem. However, he cautioned that getting Congress on board will “definitely be a challenge.”
“They’ve got to work with the authorizers to say, ‘This is our decision-making process, and we considered all the things you’re worried about, and we’re mitigating those concerns in these ways,’” Harrison told Air & Space Forces Magazine. “That also means they need to be open to feedback from the committees and be willing to maybe make some changes to show the committees that they’re being responsive to their concerns. If this is presented as a fait accompli that we’ve decided, and you just have to go along with it, that could be a disaster.”
Space Force acquisition leaders expect to name the final three PAEs in the next few weeks and settle on underlying structure by June, according to SSC’s Garrant. Time is of the essence, Harrison said, noting that budget hearings have already begun and the House and Senate Armed Services committees will soon be proposing their respective policy bills for fiscal ‘27.
“The clock is running out on them,” he said. “The armed services committees are going to be pushing ahead with their bills in the not-too-distant future. And if the Space Force is not ready to show their work yet, that’s going to be a problem.”