The request for the 700 million is above and beyond U.S. funding already allocated for the Iron Dome and Magic Wand missile defense systems.
The Iron Dome system is designed to intercept short range missiles mostly from the Gaza Strip. The Israelis had originally decided to defund the system as not being cost effective. The incoming missiles cost a few hundred dollars each but the anti-missile system interceptors 50 thousand each. See this article.
Once the U.S. approved funding the system became viable and was declared a great success against recent rocket attacks from Gaza. Actually reports indicate the results were mixed and not a great success as claimed. The Israelis want to have more batteries in the system.
Some analysts think that the 700 million might be used to bribe Israel to put off an attack on Iran. This seems a stretch. Israel does not need to put off an attack on Iran to get military funding. All they need to do is put the U.S. Israel lobby to work. In fact they probably do not even need to do that. When Israel asks for millitary funding the U.S. reacts like the proverbial Pavlovian dog. For more see this article.