Executive Summary:
As Cybersecurity Maturity Model Certification (CMMC) requirements begin appearing in new Department of Defense (DoD) (also known as the Department of War) contracts, budgeting for CMMC Level 2 has become an immediate priority for defense contractors. Cost uncertainty remains one of the biggest obstacles to readiness. Based on first-hand assessment experience and supporting multiple contractors through Level 2, three realities consistently emerge: CMMC costs are driven by scope and technical maturity, internal compliance efforts are often more expensive than expected, and early budgeting significantly reduces total cost and risk.
Why CMMC Budgeting Is Now Urgent
With the phased rollout of CMMC underway, Level 2 requirements will increasingly determine contract eligibility. Contractors that delay planning often encounter longer timelines, higher remediation costs, and limited availability from Certified Third-Party Assessment Organizations (C3PAOs). CMMC readiness is not a last-minute exercise. Preparation, remediation, and assessment scheduling can span several months. Organizations that budget early avoid rushed decisions and gain flexibility in how and when they invest in compliance.
What Actually Drives CMMC Level 2 Costs
CMMC is not a single line-item expense. It is an operational program that combines people, process, and technology. Costs vary widely based on several factors:
- Scope definition: Clearly identifying which systems, users, and workflows fall within the Controlled Unclassified Information (CUI) boundary is one of the largest cost drivers. Over-scoping increases cost unnecessarily, while under-scoping creates assessment risk.
- Infrastructure maturity: Older or inconsistently configured environments typically require more remediation and engineering effort.
- Documentation readiness: Outdated or incomplete policies, procedures, and System Security Plans increase preparation time and assessment friction.
- Remediation requirements: Gaps against NIST SP 800-171 controls often require both technical fixes and process changes.
Across organizations, three budget categories consistently account for the majority of spend:
- IT operations and patching form the foundation of a compliant environment. Device management, system updates, monitoring, and user support are essential to maintaining baseline security expectations.
- Cybersecurity tooling and engineering include endpoint protection, identity and access management, logging, monitoring, and secure enclave design. These are the technical safeguards that directly protect CUI and are heavily scrutinized during assessments.
- Compliance oversight and program management ensure controls remain effective over time. This includes evidence collection, POA&M management, internal reviews, and assessment preparation.
Why In-House Compliance Often Costs More Than Expected
Many small and midsize contractors assume internal compliance will be the least expensive path. In practice, organizations frequently underestimate the staffing, expertise, and sustained effort required to meet Level 2 expectations.
Common challenges include limited capacity within small IT teams, reliance on generalists unfamiliar with defense-specific requirements, and difficulty maintaining compliance alongside day-to-day operational demands. These factors often lead to extended timelines, rework, and higher total cost.
When to Start Budgeting
The most effective budgeting window is six to twelve months before CMMC requirements are expected to apply to your contracts. Contractors that wait until an RFP or audit deadline approaches can often see costs increase due to compressed timelines and rushed remediation.
The Bottom Line: CMMC Level 2 compliance is an investment in contract eligibility and long-term cybersecurity resilience. Contractors that approach budgeting deliberately, understand their true cost drivers, and plan early are better positioned to control expenses and avoid disruption as CMMC enforcement accelerates.
Resources that support CMMC compliance:
