This isn't a big deal. This is small, interim funding. It's called staying alive until they make a decision.
At least they are going to be able to keep the team together until a decision is made.
This is not unusual in business. I was once hired for a contract by an aerospace company for some very special work and was paid (at a very good rate) for six months to surf the Internet. Just so I wouldn't take a contract elsewhere. When the project was finally authorized I did my job and the team I worked with got it done on time and under budget. Not the norm in aerospace.
I'm glad that it's the Navy looking into fusion. It shows they're planning ahead, to how to power all those particle beam weapons and rail guns.