The House and Senate on Wednesday unveiled a final $700 billion defense policy bill for 2018 that hikes spending beyond what the Trump administration requested and defies an impending budget cap.

The National Defense Authorization Act negotiated by the two armed services committees includes $634.2 billion in base spending priorities versus $603 billion requested by President Trump this spring. It also sets aside $65.7 billion for overseas military operations.

The military would get more ships, aircraft and troops under the sprawling policy bill. But Congress has yet to reach an overarching deal to raise Budget Control Act caps that are set to hold the base spending at $549 billion, though senior Armed Services Committee aides said negotiations are ongoing.

“We remain in active conversations with the [House] leadership team and I’m very comfortable that chairman [Rep. Mac] Thornberry and the united members of our conference have made their views on what sufficient resourcing levels are required to the Speaker,” the aide said. Overseas operations spending isn't subject to the caps, so the base budget is about $85 billion above the spending limits.

In the end, the House committee under Thornberry, R-Texas, prevailed on the debate over littoral combat ships built by Lockheed Martin and Austal USA and the final bill includes three hulls, which is one more than the Senate and administration had proposed. House members had argued that more of the $568 million ships were needed to keep shipyards in Wisconsin and Alabama humming.

The military services would also get 90 Lockheed Martin F-35 joint strike fighters, versus the 70 in the president’s requested budget, and 24 Boeing F/A-18 Super Hornets, which is an increase of 10, according to a briefing by Armed Services aides.

All the services would see a boost in current troop numbers:

  • The Army could get 7,500 more active-duty soldiers as well as 500 more in the National Guard and 500 in the reserve after the administration planned no growth in the ranks for 2018.
  • The Air Force increase by 5,800 airmen, mostly in the active-duty force.
  • The Navy would get 5,000 more sailors, and the Marine Corps would see an increase of 1,000 Marines.

One of the most controversial measures, the House plan to create a new Space Corps military service inside the Department of the Air Force, was nixed from the final bill and replaced instead with language requiring a study of the issue, as well as some reforms to streamline the service’s handling of space operations.

The NDAA bill also incorporates the $4 billion supplemental budget request for missile defense made by the Trump administration this week and fully funds the $700 million request the Navy needs to repair the USS John S. McCain and USS Fitzgerald destroyers following separate collisions at sea over the summer that killed 17 sailors.

Both chambers must still pass the defense policy legislation, but the heavy political lift will be striking an agreement to raise the $549 billion defense spending cap, which Democrats have argued must come with increases in non-defense spending.

The military is operating under a continuing budget resolution that is set to expire Dec. 8, at which point Congress must pass a 2018 NDAA along with annual defense appropriations legislation to fund it, but the outcome remains uncertain.