Which color of money has a three-year life in the described categories?

• A. Procurement (OPA)
• B. Military Construction (MILCON)
• C. Research, Development, Testing & Evaluation (RDT&E)
• D. Operations & Maintenance (O&M)

Answer: (A)

In DoD budgeting, different funding types are treated as different “colors of money,” each with its own time horizon for obligating and liquidating funds. Procurement money is three-year money, meaning it can be obligated and used over a three fiscal-year period to buy equipment and major systems. This enables planning across multiple years to support long-lead procurement, contracts, and delivery timelines, without tying up funds indefinitely.

This contrasts with operating and maintenance funds, which are typically one-year money used for day-to-day operations and must be spent within the fiscal year. MILCON and RDT&E funds usually have longer, multi-year authorities to support construction and long-term development efforts. Hence, the three-year life belongs to procurement funds.