    [Senate Hearing 107-696]
    [From the U.S. Government Publishing Office]

                                                     S. Hrg. 107-696, Pt. 3

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2003

    =======================================================================

                                    HEARINGS

                                   before the

                          COMMITTEE ON ARMED SERVICES
                              UNITED STATES SENATE

                          ONE HUNDRED SEVENTH CONGRESS

                                 SECOND SESSION

                                       ON

                                    S. 2225

    AUTHORIZING APPROPRIATIONS FOR FISCAL YEAR 2003 FOR MILITARY ACTIVITIES
       OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND FOR
    DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE PERSONNEL
      STRENGTHS FOR SUCH FISCAL YEAR FOR THE ARMED FORCES, AND FOR OTHER
                                    PURPOSES

                                   ----------

                                     PART 3

                        READINESS AND MANAGEMENT SUPPORT

                                   ----------

                         FEBRUARY 28 AND MARCH 21, 2002

             Printed for the use of the Committee on Armed Services
    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                 2003--Part 3  READINESS AND MANAGEMENT SUPPORT

                                                     S. Hrg. 107-696, Pt. 3

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2003

    =======================================================================

                                    HEARINGS

                                   before the

                          COMMITTEE ON ARMED SERVICES
                              UNITED STATES SENATE

                          ONE HUNDRED SEVENTH CONGRESS

                                 SECOND SESSION

                                       ON

                                    S. 2225

    AUTHORIZING APPROPRIATIONS FOR FISCAL YEAR 2003 FOR MILITARY ACTIVITIES
       OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND FOR
    DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE PERSONNEL
      STRENGTHS FOR SUCH FISCAL YEAR FOR THE ARMED FORCES, AND FOR OTHER
                                    PURPOSES

                                   __________

                                     PART 3

                        READINESS AND MANAGEMENT SUPPORT

                                   __________

                         FEBRUARY 28 AND MARCH 21, 2002

             Printed for the use of the Committee on Armed Services

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                          COMMITTEE ON ARMED SERVICES

                         CARL LEVIN, Michigan, Chairman

    EDWARD M. KENNEDY, Massachusetts     JOHN WARNER, Virginia
    ROBERT C. BYRD, West Virginia        STROM THURMOND, South Carolina
    JOSEPH I. LIEBERMAN, Connecticut     JOHN McCAIN, Arizona
    MAX CLELAND, Georgia                 BOB SMITH, New Hampshire
    MARY L. LANDRIEU, Louisiana          JAMES M. INHOFE, Oklahoma
    JACK REED, Rhode Island              RICK SANTORUM, Pennsylvania
    DANIEL K. AKAKA, Hawaii              PAT ROBERTS, Kansas
    BILL NELSON, Florida                 WAYNE ALLARD, Colorado
    E. BENJAMIN NELSON, Nebraska         TIM HUTCHINSON, Arkansas
    JEAN CARNAHAN, Missouri              JEFF SESSIONS, Alabama
    MARK DAYTON, Minnesota               SUSAN COLLINS, Maine
    JEFF BINGAMAN, New Mexico            JIM BUNNING, Kentucky

                         David S. Lyles, Staff Director

                  Judith A. Ansley, Republican Staff Director

                                     ______

                Subcommittee on Readiness and Management Support

                       DANIEL K. AKAKA, Hawaii, Chairman

    ROBERT C. BYRD, West Virginia        JAMES M. INHOFE, Oklahoma
    MAX CLELAND, Georgia                 STROM THURMOND, South Carolina
    MARY L. LANDRIEU, Louisiana          JOHN McCAIN, Arizona
    E. BENJAMIN NELSON, Nebraska         RICK SANTORUM, Pennsylvania
    MARK DAYTON, Minnesota               PAT ROBERTS, Kansas
    JEFF BINGAMAN, New Mexico            JIM BUNNING, Kentucky

                                      (ii)
    ?

                                C O N T E N T S

                                  ----------

                        CHRONOLOGICAL LIST OF WITNESSES
         Department of Defense Installation and Environmental Programs
                               february 28, 2002

                                                                       Page

    DuBois, Raymond F., Jr., Deputy Under Secretary of Defense
      (Installations and Environment)................................     6
    Fiori, Hon. Mario P., Assistant Secretary of the Army
      (Installations and Environment)................................    17
    Johnson, Hon. H.T., Assistant Secretary of the Navy
      (Installations and Environment)................................    34
    Gibbs, Hon. Nelson F., Assistant Secretary of the Air Force
      (Installations, Environment, and Logistics)....................    53

            Readiness of U.S. Armed Forces for all Assigned Missions
                                 march 21, 2002

    Mayberry, Dr. Paul W., Ph.D., Deputy Under Secretary of Defense
      (Readiness)....................................................   124
    Newbold, Lt. Gen. Gregory S., USMC, Director for Operations (J-
      3), The Joint Staff............................................   130
    McKiernan, Lt. Gen. David D., USA, Deputy Chief of Staff, G-3/5
      (Operations and Plans).........................................   137
    Krol, Rear Adm. Joseph J., Jr., USN, Assistant Deputy Chief of
      Naval Operations for Plans, Policy, and Operations, Chief of
      Naval Operations...............................................   145
    Bedard, Lt. Gen. Emil R., USMC, Deputy Commandant for Plans,
      Policies, and Operations, Headquarters, United States Marine
      Corps..........................................................   152
    Wald, Lt. Gen. Charles F., USAF, Deputy Chief of Staff for Air
      and Space Operations, Headquarters.............................   163

                                     (iii)

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2003

                                  ----------

                          THURSDAY, FEBRUARY 28, 2002

                               U.S. Senate,
                      Subcommittee on Readiness
                                and Management Support,
                                   Committee on Armed Services,
                                                        Washington, DC.

         DEPARTMENT OF DEFENSE INSTALLATION AND ENVIRONMENTAL PROGRAMS

        The subcommittee met, pursuant to notice, at 2:36 p.m. in
    room SR-232, Russell Senate Office Building, Senator Daniel K.
    Akaka (chairman of the subcommittee) presiding.
        Committee members present: Senators Akaka, E. Benjamin
    Nelson, and Inhofe.
        Committee staff member present: David S. Lyles, staff
    director.
        Majority staff members present: Maren Leed, professional
    staff member; Peter K. Levine, general counsel; and Michael J.
    McCord, professional staff member.
        Minority staff members present: George W. Lauffer,
    professional staff member; and Thomas L. MacKenzie,
    professional staff member.
        Committee members' assistants present: Menda Sue Fife,
    assistant to Senator Kennedy; Christina Evans, assistant to
    Senator Byrd; Davelyn Noelani Kalipi, assistant to Senator
    Akaka; Eric Pierce, assistant to Senator Ben Nelson;
    Christopher J. Paul and Dan Twining, assistants to Senator
    McCain; George M. Bernier III, assistant to Senator Santorum;
    and Derek Maurer, assistant to Senator Bunning.
        Staff assistants present: Dara R. Alpert and Daniel K.
    Goldsmith.

         OPENING STATEMENT OF SENATOR DANIEL K. AKAKA, CHAIRMAN

        Senator Akaka. The Subcommittee on Readiness and Management
    Support will come to order. Good afternoon, everyone. This
    subcommittee meets today to review the fiscal year 2003 budget
    request for military construction, family housing, and
    environmental and other installation programs of the Department
    of Defense. This afternoon we will hear from Raymond DuBois,
    the Deputy Under Secretary of Defense for Installations and
    Environment, and from the assistant secretary responsible for
    installations and environmental matters for each of the
    military departments. Present from the Department of the Army
    is the Honorable Mario Fiori; from the Department of the Navy,
    the Honorable H.T. Johnson; and from the Department of the Air
    Force, the Honorable Nelson Gibbs.
        This is the first appearance before this subcommittee for
    Secretary Fiori, Secretary Johnson, and Secretary Gibbs since
    their confirmations. We welcome you and look forward to working
    with you in the future. I was happy to have a chance to sit and
    talk with you.
        Today we will ask our witnesses to provide an overview of
    the budget request for the military construction (MILCON) and
    family housing programs and the environmental restoration and
    compliance programs. I hope that you will be able to outline
    for the subcommittee not only the funding levels and major
    programs in this budget, but also the philosophy and priorities
    you used for this budget request.
        The fiscal year 2002 budget made a substantial investment
    in the Department's facilities, an area that has been too low a
    priority within the Department of Defense for too long. Last
    year, I said that the fiscal year 2002 budget request for
    installation programs was a step in the right direction, but
    that both the Department of Defense and Congress had to make a
    sustained effort to address these issues in the coming years,
    because a one-time increase is not enough to bring our
    installations up to the appropriate standard.
        I am disappointed that the fiscal year 2003 budget request
    for military construction is $1 billion below the fiscal year
    2002 administration request and more than $1.5 billion below
    the level Congress provided last year. This budget assumes that
    we will achieve the goal of recapitalizing our facilities at
    less than 100 years, but only if we achieve unprecedented
    levels of investment, more than double the amount requested
    this year, in the future.
        Relying on large funding increases in the future is a risky
    strategy. I hope that we can achieve a more realistic and
    sustainable funding path for military construction.
        In general, this budget fully funds a stable DOD
    environmental program. However, I do have two areas of concern:
    the lack of any significant funding for cleanup of unexploded
    ordnance (UXO) and a falloff in funding for cleanup of closed
    bases and formerly used defense sites.
        I look forward to working with Senator Inhofe, other
    members of the subcommittee, and with the Department of Defense
    to enhance the quality of life of our military service members
    and their families; respond to increasing requirements for
    force protection at our installations; fund a steady,
    sustainable path that will get the quality of our installations
    to the level it should be; and carry out our training and other
    activities in a way that protects the environment and earns the
    trust of the American people, especially those who live on and
    near our installations.
        I would like to recognize Senator Inhofe for any statement
    he may have.

                  STATEMENT OF SENATOR JAMES M. INHOFE

        Senator Inhofe. Thank you, Mr. Chairman. I have a prepared
    statement which I will submit for the record, but I would also
    like to make several comments. First of all, I agree with
    Senator Akaka; I was disappointed in the amount in the budget
    for military construction.
        I do want to thank you, Secretary Gibbs, for the time you
    gave me in working on some of these issues. I am looking
    forward to working with all of you.
        When we had our August hearing, I congratulated the
    administration on the robust military construction and family
    housing funding request. Even after the $48 billion came along
    and after September 11, it did not come out that way. We end up
    now nearly $1 billion lower than the fiscal year 2002. This is
    something that is of great concern to me.
        As our chairman knows, I have taken the time to go out and
    visit virtually all of these installations, and we really need
    to be concentrating on making improvements to military housing.
        Much of the funding that is in the budget is in the out
    years, and history shows us that the out years never get here.
    So that is a great concern for me.
        But I think the most disturbing thing is the Department's
    justification for the reduction. Rather than tell the American
    public that they reduced the MILCON budget to support higher
    priority projects, the Department blames the reduction on the
    delay in base realignment and closure (BRAC), the presumption
    being that the Department did not want to spend money on bases
    that might be closed in the future. It reaffirms the belief
    that the BRAC process is flawed and subject to the political
    whim of both sides of the river.
        We have all talked about another BRAC round and the effects
    it would have. The only thing that I see that we know is that
    in the first 3 or 4 years, a closed base costs money. Right now
    we are in desperate straits, even with the additional $48
    billion in the defense request. It does not have anything in
    there for MILCON--it is actually reduced. Force strength is
    also left out.
        I think anything that would cost money now is something
    that should be delayed. The other argument is that we do not
    know what the force structure is going to look like so we do
    not know what infrastructure is going to be excess.
        We have talked about encroachment problems and we need to
    all bring this up. I would like to have all of you address this
    problem. We are running out of ranges. We have environmental
    problems and suspected habitat of endangered species in many
    places. The more we do to accommodate the more suspected
    habitats there are, Fort Bragg and Camp Lejeune being examples
    of this, the more of a problem this becomes.
        Finally, I am very concerned about the Navy's claimed
    ability to find an alternative equivalent training facilities
    to replace Vieques. Vice Admiral Amerault, said a May 2001 Sea
    Power interview: ``Encroachment is a serious problem. There is
    a potential to lose the use of our ranges on Vieques Island and
    that could have a very serious readiness impact.'' That is the
    bell ringer for us. On the heels of that, even as we are
    fighting to keep Vieques as a viable training activity and
    resource, we are finding it increasingly difficult to train our
    sailors effectively at other locations due to the overly broad
    legal requirements combined with commercial and urban
    encroachment.''
        I know about this firsthand. I took the time to go when the
    U.S.S. Kennedy was getting ready for deployment. I was on the
    U.S.S. Wasp and the U.S.S. Mount Whitney. All of them agree
    that we are not doing a good job of training. In fact, they all
    agree on a similar figure when I asked ``if live-fire is a ten,
    what is your training?'' They all said ``five.'' If we lose the
    fight on Vieques we are going to lose other ranges all around
    the world.
        These are things I would like to have all of you aware of
    as my personal concerns. I think they are also the concerns of
    our chairman, and I hope you will address them during our
    hearing today.
        Thank you, Mr. Chairman.
        [The prepared statement of Senator Inhofe follows:]
                 Prepared Statement by Senator James M. Inhofe
        Thank you, Chairman Akaka.
        Mr. Chairman, I join you in welcoming back Mr. Ray DuBois, who
    testified before the subcommittee last August, just weeks after his
    appointment to the critical position as Deputy Under Secretary of
    Defense for Installation and Environment. I also join you in welcoming
    his colleagues, Assistant Secretary of the Army, Mario Fiori; Assistant
    Secretary of the Navy, H.T. Johnson; and Assistant Secretary of the Air
    Force, Nelson Gibbs. We are fortunate to have individuals of your
    caliber.
        In my opening statement for the August 2001 hearing, I
    congratulated the administration for the robust military construction
    and family housing funding request. Regrettably, I cannot make the same
    assessment of the fiscal year 2003 request. I find it ironic that
    despite a $48 billion increase in the defense budget, the funding for
    MILCON and family housing is more than $900 million lower that the
    fiscal year 2002 request.
        Mr. DuBois, last year in your opening statement you stated: ``Our
    fiscal year 2002 budget initiates an aggressive program to renew our
    facilities.'' The program you are presenting today is far from
    aggressive. In fact, it is regressive. What is more disturbing is that
    the budget builds expectations that there is funding in the out years
    get the program back on track. History shows us that the promises made
    for the out years are routinely supplanted by higher priorities.
    Although I would like to believe the Navy will have a $2.9 billion
    MILCON program in 2007, the reality is that it will be less than that
    lofty number.
        More disturbing is the Department's justification for the
    reduction. Rather than telling the American public that they reduced
    the MILCON budget to support higher priority projects, the Department
    blames the reduction on the delay in base closure. The presumption is
    that the Department did not want to spend money on bases that might be
    closed in a future BRAC. It reaffirms my belief that the BRAC process
    is flawed and subject to the political whim on both sides of the river.
        During this hearing we will also review the Department's fiscal
    year 2003 environmental programs. I would like to hear about the
    actions taken to resolve the environmental encroachment problems. In a
    series of hearings held last year, senior military witnesses alerted
    Congress to the cumulative adverse impact of encroachment on military
    readiness. My discussions with commanders confirm that encroachment
    poses a serious threat to readiness.
        At the Goldwater Range, Arizona, the Air Force and Marine Corps
    operate with altitude restrictions because of noise impacts on
    endangered Sonoran Pronghorn Antelope. Live-fire training at the Army
    National Guard's Massachusetts Military Reservation has been suspended
    since April 1997 because of groundwater contamination concerns. The
    future of live-fire training at Makua Military Reservation, Hawaii,
    remains questionable because of groundwater contamination, endangered
    species, and cultural and natural resource issues. Finally, I am very
    concerned about the Navy's claimed ability to find alternative,
    equivalent training facilities to replace Vieques. In May 2001, Sea
    Power interviewed Vice Admiral Amerault, Deputy Chief of Naval
    Operations, Fleet Readiness and Logistics, who suggested this may not
    be an achievable goal: ``Encroachment is a serious problem. There is a
    potential to lose the use of our ranges on Vieques Island [Puerto
    Rico], and that could have a very serious readiness impact. That's the
    bell ringer for us. On the heels of that, even as we are fighting to
    keep Vieques as a viable training activity and resource, we are finding
    it increasingly difficult to train our sailors effectively at other
    locations due to overly broad legal requirements combined with
    commercial and urban encroachment.''
        The services have primarily responded to environmental encroachment
    through ``work-arounds'' that instill bad habits that may prove costly
    in combat. Given the magnitude of the threat, it is critical that the
    DOD and services seek resolutions that preserve quality training. Thank
    You, Mr. Chairman.

        Senator Akaka. Senator Inhofe, thank you very much for your
    statement.
        Senator Ben Nelson.
        Senator Ben Nelson. Thank you, Mr. Chairman.
        First of all, I want to thank our panelists for being here
    today to help address concerns raised regarding the readiness
    of our armed services. I appreciate your being here, and I
    realize that all of you are concerned, as we are, with
    providing our service men and women and their families with the
    best and the most supportive installations we can afford.
        Obviously, it is a complex formula when you have to assess
    whether to construct new facilities in light of BRAC and
    compete with the funds that may have to go the procurement or
    operations and can be otherwise expended for worthwhile
    purposes as well. So the competing issues of BRAC, being good
    stewards of the environment, encroaching land development
    around installations, providing for military families, and
    ensuring that the services themselves have adequate training
    areas to maintain proficiency and readiness, even including
    such issues as Vieques, all makes for a tough job and I do not
    envy what it is that you try to do.
        I am concerned that at Offutt Air Force Base, Nebraska,
    home for the largest wing in the Air Force, many of the airmen
    have been operating a fire crash and rescue unit out of an old
    unsatisfactory hangar, which is certainly not the kind of
    housing arrangement they need for a fire station. But they are
    currently doing a magnificent job with what they have.
        I hope that today, not that you are going to tell me about
    how you are going to take care of Offutt, that you address
    concerns like these at the various installations all over the
    world that are coming under some of the same challenges and
    inadequacies.
        I have some questions, but I will direct them at a later
    time. Thank you for being here.
        Senator Akaka. Thank you very much for your statement.
        I will call upon our witnesses for your statements. Without
    objection, your entire statements will be included in the
    record of this hearing.
        We will begin with Mr. DuBois, who serves as the principal
    adviser to the Secretary of Defense on issues affecting
    military installations and environmental issues. I welcome you
    back to the subcommittee and ask you to proceed.

    STATEMENT OF RAYMOND F. DuBOIS, JR., DEPUTY UNDER SECRETARY OF
                DEFENSE (INSTALLATIONS AND ENVIRONMENT)

        Mr. DuBois. Thank you, Mr. Chairman. With your permission,
    I will submit my written statement for the record. I do have a
    few remarks to begin with.
        As you indicated, this is the first appearance before your
    subcommittee for the gentlemen on my right and left. We
    constitute what the Secretary of Defense refers to as the
    Installation and Environment Executive Committee of the
    Department. We meet every Tuesday morning to share notes,
    commiserate, prepare, and to try to figure out creative ways to
    solve some of the problems which Senator Akaka, Senator Inhofe,
    and Senator Nelson have raised today. I hope to touch briefly
    upon them, as will my colleagues.
        I am very proud to be a member of this executive team and I
    can assure you, while it is inescapable the military
    construction budget this year versus last is reduced, that the
    folks who are facing you today have worked very hard within a
    certain framework to come up with what we consider to be a
    feasible and a fiscally responsible plan for getting our
    facilities on a continuing path to recovery.
        September 11 changed our Nation forever. We continue,
    however, to transform our installations and our facilities and
    maintain our commitment to quality of life for the people who
    wear the uniform of this Nation. In the wake of September 11,
    the Secretary of Defense's commitment and dedication to
    reforming the way we do the business of national defense and
    reshaping the way we manage our resources within this
    enterprise has not diminished. He recognizes that transforming
    the military also requires transforming our infrastructure.
        Within that context, however, the quality of life issue and
    the people issue remain very high priorities. While the issue
    of basic allowance for housing is not the purview of this
    subcommittee, we are eliminating out of pocket costs paid for
    by the service members by 2005, which is very important to
    recognize.
        We also are increasing our reliance upon the private sector
    for access to both existing quality housing and to privatized
    housing, a program which up until a year plus ago was, I think,
    at the level of 6,000 or 7,000 units privatized. While things
    were already in the pipeline, since Secretary Rumsfeld took
    office we have had upwards of 18,000 more units privatized.
        We are grateful to Congress, to you gentlemen, for
    extending our housing privatization authorization until 2012,
    although we intend to meet the goal of eliminating inadequate
    housing in the Department by 2007.
        The continuing effort to fund MILCON for housing where
    necessary means we are requesting an increase of $222 million
    for family housing MILCON in fiscal year 2003. As I indicated,
    the Secretary has pulled up the goal of eliminating all
    inadequate housing from 2010 to 2007.
        We are going to maintain our commitment to our
    unaccompanied service men and women in Korea and elsewhere. In
    fiscal year 2002, we constructed and revitalized about 16,000
    barracks or bachelor officer and bachelor enlisted quarters
    spaces. This year we plan to construct and revitalize another
    14,000 spaces.
        Let me talk a little bit about sustainment. The entire
    portfolio of investment, the entire portfolio of Department of
    Defense resources focused on infrastructure, not just in a
    MILCON sense but also in an operations and mainenance sense. To
    those outside of this world, it uses terms and words which
    sometimes are confusing, but I think we all understand that
    sustainment is a very important issue that we have not invested
    to the level that we should.
        I think that I just saw recently that sustainment in our
    Services is going up. Of course, this is a new metric, one that
    we have only used for the last 2 years. In 2002, every Service
    will be at 89.4 percent; in 2003, we will be up to 92.6
    percent; and in 2007, we will be up to a level of 96 percent.
        The total MILCON program, as we both said, is down. But if
    you look at that total facilities program in its context,
    including sustainment, the budget request overall is only
    reduced about 3 percent. Fully-sustaining our facilities this
    year is our first priority. The fiscal year 2003 budget request
    slows the deterioration of our facilities and, over time, we
    will fully restore their readiness.
        We have increased sustainment funding, as I said, to the 93
    percent level from the 89 percent in last year's budget, and we
    plan to increase those percentages over time and also in fiscal
    year 2004.
        Recapitalization, the so-called restoration and
    modernization accounts, are clearly reduced year over year. I
    agree with you, Senator Inhofe, that the excuse, and I use that
    word somewhat advisedly, that the sole factor of BRAC is
    incorrect. The Secretary has, in my view, tried to correct that
    impression, although I do want to say that it is a factor, but
    certainly not the factor. Each of us in our own way I think is
    going to address that, and I am glad to answer it in more
    detail in your questioning.
        We still stand by our goal of achieving a 67-year
    recapitalization rate by the end of fiscal year 2007, and the
    current plan is to actually achieve it at the beginning of
    fiscal year 2007. This issue is contentious and needs to be
    addressed, whether or not we achieve a certain percentage of
    infrastructure reduction.
        I too am concerned, and I want to go on the record about
    the funding necessary to achieve a 67-year recapitalization
    rate. Mr. Chairman and Senator Inhofe, you are correct to be
    concerned. There is a phrase called the ``hockey stick'' where,
    whether it is a procurement account, operations and maintenance
    account, or a research, test, development, and evaluations
    account, you put things in the out years in your plan and you
    are basically saying, ``I am committed to do that.'' We have
    seen this before. We have seen the commitments not met. It is a
    concern that all four of us at this table shoulder every day,
    and we will commit to you to continue to fight for.
        I am looking around the table, mentally going through the
    votes on BRAC. This subcommittee was split on that issue, as
    was the Senate. On behalf of Secretary Rumsfeld, I want to
    thank you and all the members of the Senate Armed Services
    Committee for your support, recognizing it was a tough vote for
    many of you.
        But the Secretary's effort to rationalize our total
    infrastructure through a needed BRAC is very important, and the
    authority to do so is very much appreciated. You gave us until
    2005 to make those recommendations. We are going to take the
    time to do this in a very deliberate, methodic, and
    comprehensive way, and we hope that when it is all said and
    done, the authority which you have given to us, we will have in
    turn honored your trust to come out with an appropriate
    rationalization.
        Transformation requires rationalizing our base structure to
    better match the force structure, which, as the Senator said,
    is a work in progress. We are organizing and planning to
    accomplish that analysis, as I indicated. But we have not
    deferred projects in anticipation of BRAC. Our fiscal year 2003
    budget request reflects what the Secretary, the Service
    Secretaries, and Service Chiefs consider to be the highest
    priorities identified by the Services to support their missions
    as they are currently configured.
        As we are just beginning to analyze the total DOD
    infrastructure from the BRAC point of view, specific
    construction projects for fiscal year 2003 are driven by
    current military necessity and to support current mission-
    critical requirements.
        One more item that is very important, and an item that I am
    spending an increasing amount of time on, is encroachment. When
    Secretary Rumsfeld and I were in the Pentagon 30 years ago,
    encroachment was not a word in our lexicon. Maybe it should
    have been, because some of the installations today are
    encroached upon to their fenceline.
        We have an obligation for our successors. We have an
    obligation for the next generation and the current generation
    of men and women who wear the uniform of this country,
    especially in terms of training and test ranges, to come up
    with ideas and proposals that will relieve us of some of the
    encroachment and environmental restraint.
        We are in the process of completing environmental
    remediation quickly and effectively. In excess of $4 billion in
    last year's budget and in this year's request is devoted to
    environmental programs of one kind and another.
        With respect to encroachment, we are addressing that issue
    and have been doing so ever since December when the Deputy
    Secretary of Defense, Dr. Paul Wolfowitz, established an
    overarching integrated product team (OIPT) including the
    gentlemen on my right and left, to address the test and
    training mission needs of our military, regulatory
    requirements, and issues of environmental statutes where we
    believe that clarifications may be advisable.
        The Secretary of Defense and the Deputy Secretary of
    Defense are awaiting the recommendations of that OIPT and we
    intend to have a set of proposals in front of them in the very
    near future, hopefully within the next couple of weeks.
        In closing, I personally want to thank the three who are
    here today and your colleagues who have advised me when I
    travel out around the country. I have been to over 30 major
    installations, most recently in Arizona, where I visited Davis-
    Monthan Air Force Base and Fort Huachuca. The visits to these
    installations, as well as the visits by my colleagues, provide
    us with an absolutely important on-the-ground reality check.
        We are all committed to providing and supporting healthy
    installations, facilities, and housing. We must enhance
    readiness and get back to training, test range, and
    encroachment issues. We believe that we have addressed morale
    and quality of life with plus-ups over last year. But it is not
    just for our people in uniform. It is also the civilians, the
    committed, dedicated, and loyal group of civil servants who
    labor day by day to support our Nation's defense.
        We look forward to working with you to help us do this job
    better. I thank you personally, and I will now turn to
    Secretary Fiori, the Assistant Secretary of the Army.
        [The prepared statement of Mr. DuBois follows:]

                  Prepared Statement by Raymond F. DuBois, Jr.

                                  INTRODUCTION

        Mr. Chairman and distinguished members of this subcommittee, thank
    you for the opportunity to discuss the Department of Defense's fiscal
    year 2003 programs supporting military installations and facilities and
    the Department's environmental management. The Department's goal is to
    restore the readiness of our installations and facilities--which are
    the foundation for military operations and deployments. We are
    continuing to improve the management of our installations and housing
    to ensure that they can fully support the men and women who live and
    work there in the accomplishment of their mission.
        To begin, I would first like to recognize you and the subcommittee
    for the support you continue to provide to the Department. In
    particular, we appreciate this subcommittee's strong support for the
    Secretary's effort to rationalize our infrastructure through a needed
    round of base realignment and closure. We are also grateful for
    Congress' willingness to extend our housing privatization authority to
    2012. These actions support the key elements of the Department's
    program to manage military installations and facilities more
    efficiently.
        Today, I will address: the current state of our facility assets and
    the Department's revitalization plans; our sustainment, restoration,
    and modernization programs; our management initiatives; and our
    environmental progress.

                           REVITALIZING INSTALLATIONS

        As Secretary Rumsfeld recently testified to Congress, ``. . .
    September 11 changed our Nation forever.'' Our challenge today and in
    the future is to accomplish three difficult missions at once: to win
    the war on terrorism, to restore our military forces through
    investments in procurement, people, and modernization, and to transform
    our forces to meet future demands.
        Last year, the Secretary of Defense undertook a series of
    initiatives to transform our installations and facilities into those
    required for a 21st century military. Our fiscal year 2003 budget, as
    well as our current future years defense program, supports that
    commitment. In the context of competing priorities resulting from the
    events of September 11, we have developed a feasible and fiscally
    responsible plan for getting our facilities on a path to recovery. Even
    after the events of September 11, we are continuing to transform our
    installations and maintain our commitment to our people by improving
    their quality of life.
    Installations' Vision
        Military installations and facilities are an integral component of
    readiness. Installations are the ``platforms'' from which our forces
    successfully deploy to execute their diverse missions. However, they
    are also places where our people live, work, and train. The
    Department's sustainment, restoration, and modernization programs must
    enhance military readiness, while also providing in adequate quality of
    life an adequate working environment and provide for appropriate
    military training.
        Quality of life and quality of workplace are directly linked to the
    quality of our infrastructure. Many surveys have shown that poor
    quality facilities and services are a major source of dissatisfaction
    for families and services members alike. Our aging and deteriorating
    infrastructure has a direct impact on retention.
        To address these long standing infrastructure problems in an
    integrated fashion, the Department is aggressively pursuing a number of
    approaches to benefit service members and improve their quality of
    life. First, we will increase the basic allowance for housing to
    eliminate the out-of-pocket costs paid by service members for private
    sector housing in the United States. The fiscal year 2003 budget
    request includes necessary funding to continue lowering service
    members' out-of-pocket housing costs for those living off-base from
    11.3 percent today to 7.5 percent in 2003. By 2005, the typical member
    living off-base will have no out-of-pocket housing expenses.
        Second, we will increase our reliance upon the private sector--
    higher allowances will increase and enhance service member access to
    existing quality housing. Higher allowances will also increase the
    income available to private sector developers, facilitating increases
    in the quantity and quality of privatized housing.
        Finally, we will continue to fund military construction for housing
    where necessary. Our fiscal year 2003 budget requests about $227
    million more for family housing construction than last year. We have
    also maintained our significant investment in barracks modernization.
    The combination of increased allowances and continued use of
    privatization will permit more efficient use of our military
    construction funding. Increased availability of quality private sector
    options will ease pressure for on-base housing, reduce the need to
    maintain our current inventory, and allow us to spend our sustainment
    funding more wisely.
        The Defense Facilities Strategic Plan, published in August 2001,
    defines our facilities vision for the future--healthy, productive
    installations and facilities that are available when and where needed
    with capabilities to support current and future military requirements.
    At the same time, we must spend the taxpayer's investment wisely and
    transform the way we do business to reduce the total operational cost
    of ownership of our installations and facilities.
        We must right size and locate our installations and facilities
    based on military requirements. The recently authorized base
    realignment and closure round in 2005 provides a key tool that will
    allow the Department to align operational forces with the installations
    best suited to their 21st century missions. Providing the right quality
    installations and facilities also means we furnish quality living and
    working environments that support the warfighters' missions while
    enhancing quality of life for our service members and their families.
        Through providing the right resources and leveraging that funding,
    we will achieve the right size and quality of our installations and
    facilities. We have developed analytical tools and metrics that allow
    us to more accurately forecast our requirements and measure our
    progress. Our tools, like the Facilities Sustainment Model, which
    identifies facility sustainment requirements, and the Facilities
    Recapitalization Metric, which assesses the rate of modernization
    relative to the service life of the facilities' inventory, have
    matured, and we have several new tools under development. For instance,
    we are integrating the services' real property inventory databases to
    guide and monitor management decisions. Accomplishing these goals will
    ensure that the needs of the warfighters and military families are met.
    Current State of Facility Assets
        In fiscal year 2000, 42 Major Commands of the military services
    collectively rated 69 percent of their nine facilities categories C-3
    (have serious deficiencies) or C-4 (do not support mission
    requirements) as reported in their Installations' Readiness Reports. At
    the end of fiscal year 2001, with 43 Major Commands now reporting, this
    percentage is 68 percent.
        The first step to improve our readiness posture is to sustain what
    we own. It will take some time to reach an acceptable state of
    readiness. We are committed to sustaining our facilities appropriately
    to avoid incurring substantial costs in later years. In the fiscal year
    2003 budget request, the Department funds 93 percent of the
    requirement. The fiscal year 2003 recapitalization rate for our
    facilities has increased to about 150 years (121 if one factors in the
    potential 20 to 25 percent reduction that could be achieved from base
    realignment and closure). However, the fiscal year 2003 military
    construction request is the second largest in the past 6 years. We plan
    to invest over $20 billion from fiscal years 2003 through 2007 to
    achieve our goal of a 67-year recapitalization rate by the end of the
    Future Years Defense Program.
        For fiscal year 2003, we are requesting a total of $9 billion for
    military construction, family housing, and environmental remediation on
    properties from the 1988 to 1995 base realignment and closure rounds.
    Consistent investment levels over time will help us restore and
    maintain readiness, stabilize, and reduce the average age of our
    physical plant, reduce overhead costs, and maximize our return on
    investment. Last year, the Department modernized its treatment of our
    real property requirement. Our approach to sustainment (operations and
    maintenance-like \1\ funds) and restoration and modernization (both
    military construction and operations and maintenance funds), underscore
    our focus on improving infrastructure management.
    ---------------------------------------------------------------------------
        \1\ Includes O&M as well as related military personnel, host
    nation, and working capital funds.

                               SUMMARY OF REQUEST
                   [President's budget in billions of dollars]
    ------------------------------------------------------------------------
                                                        Fiscal Year Request
                    Funding Category                 -----------------------
                                                         2002        2003
    ------------------------------------------------------------------------
    New Footprint (MilCon)..........................         1.4         1.5
    Restoration and Modernization (MilCon)..........         3.8         2.5
    Restoration and Modernization (O&M-like)........          .8          .8
    Sustainment (O&M-like)..........................         5.1         5.6
    Family Housing Construction/Improvements........         1.1         1.3
    Family Housing Maintenance......................         1.3         1.3
                                                     -----------------------
      Total SRM, New Footprint, FH Const. & Maint...        13.5        13.0
    ------------------------------------------------------------------------

        Fully sustained, restored, and modernized facilities are more cost
    effective in the long term and result in more prudent use of scarce
    resources. It is more expensive to allow facilities to deteriorate,
    which reduces service life and causes premature recapitalization
    requirements. Further, deteriorated facilities contribute to mission
    interruptions.

                                  SUSTAINMENT

        The first principle of sound installation management is taking care
    of what you own, and our fiscal year 2003 budget request supports that
    principle. Our fiscal year 2003 budget request of $5.6 billion
    increases sustainment funding to 93 percent of the requirement, from 89
    percent in last year's budget. Full funding of sustainment throughout
    the program is an appropriate investment that will avoid significant
    costs in the future by stabilizing facility conditions and preventing
    further erosion.
        The fiscal year 2003 budget request also includes $6.1 billion for
    Real Property Services (RPS) which are must pay ``open-the-door'' costs
    generally performed by contract. The RPS account includes purchase of
    utilities, lease payments, custodial services, trash collection, snow
    removal, and grounds maintenance.

                                RECAPITALIZATION

        The Department is requesting $3.3 billion for recapitalization in
    fiscal year 2003 (including both operations and maintenance and
    military construction funds) to restore and modernize our facilities.
    Recapitalization is important not only to restore the readiness of poor
    facilities, but also to maintain the relevance of all facilities to
    future missions of the Department. A consistent modernization program
    tied to expected service life best accomplishes this. The Department
    stands by its goal of achieving a recapitalization rate of 67 years. We
    currently plan to achieve this goal by fiscal year 2007.
        There may be concerns with the increased fiscal year 2003
    recapitalization rate. However, our fiscal year 2003 budget request
    represents a restructuring of our priorities to achieve a more fiscally
    responsible program with lower costs over the long term. Sustaining
    facilities up front will reduce the need for costly restoration of
    facilities in the future, and we are requesting significant increases
    to our sustainment budget to accomplish this. In addition, the majority
    of the military construction budget projects (over 60 percent) are for
    restoration and modernization of mission critical requirements.

         COMPARISON OF MILITARY CONSTRUCTION AND FAMILY HOUSING REQUESTS
                   [President's budget in billions of dollars]
    ------------------------------------------------------------------------
                                                        Fiscal Year Request
                                                     -----------------------
                                                         2002        2003
    ------------------------------------------------------------------------
    Military Construction...........................       5,210       4,054
    NATO Security Investment Program................         163         168
    Base Realignment and Closure IV.................         532         545
    Family Housing Construction.....................       1,114       1,341
    Family Housing Operations and Maint.............       2,940       2,877
    Homeowners Assistance...........................          10           0
    Family Housing Improvement Fund.................           2           2
                                                     -----------------------
      Total.........................................       9,971       8,987
    ------------------------------------------------------------------------

                                    HOUSING

        Military housing is a priority for the President and the Secretary,
    is an integral part of the Administration's Management Plan, and is
    crucial to providing a decent quality of life for our service members.
    We are investing $1.2 billion in the budget request to construct or
    revitalize almost 14,000 barracks spaces for our unaccompanied service
    men and women to continue improvements in their quality of life. The
    services are making great progress toward meeting, or have already met,
    the Department's goal for eliminating gang latrine conditions for
    permanent party unaccompanied service members.
        Our request of $4.2 billion for military family housing in fiscal
    year 2003 will operate and maintain the Department's family housing and
    enable us to eliminate most substandard housing by 2007--3 years
    earlier than previously planned. Our family housing construction budget
    request of $1.3 billion, up from the $1.1 billion requested in fiscal
    year 2002, supports traditional approaches to military family housing
    as well as the Department's plan to renovate, replace, or privatize
    over 35,000 housing units. We plan to have privatized a cumulative
    total of over 60,000 units by the end of fiscal year 2003. The
    Department is also requesting $2.9 billion for operating and
    maintaining almost 280,000 family housing units world-wide, (251,000
    government-owned and another 29,000 leased), approximately 60 percent
    of the government-owned units are considered inadequate.
        The Department's use of housing privatization, aided by Congress'
    extension of our authorities to 2012, continues to leverage our funding
    and has allowed us, to date, to privatize over 17,500 housing units.
    Our most recent projects have been at Fort Hood, Texas, where Army
    personnel have been deployed to support Operation Enduring Freedom and
    Naval Complex South Texas, which includes Naval Air Station Corpus
    Christi and Naval Station Ingleside in Texas.
        Privatizing military housing is a Presidential and Secretary of
    Defense management priority and is recognized as a key item on the
    administration's agenda to improve the quality of life for our service
    men and women. Because decent, safe, and affordable housing is such an
    important component of our service members' lives, we are taking steps
    to ensure that the privatization projects we have already undertaken
    remain fiscally and physically in good shape. To that end, we are
    overseeing the legal and financial documents of these projects through
    our internal oversight document called the Program Evaluation Plan,
    which provides the Secretary of Defense with key information on the
    services' portfolio management of these projects. We are using this
    report to oversee the services' progress in project management, meeting
    schedules for housing renovation and construction, customer
    satisfaction, and overall financial management.
        Privatization is intended to enable the military services to
    revitalize their inventories of inadequate housing by leveraging
    appropriations with private capital. Under privatization policy, the
    services leverage appropriations to get at least three times the
    housing they would get under traditional military construction
    programs. In practice, the current 10 projects in our most recent
    report have leveraged appropriations at a rate of six to one. In
    addition, our data show that our initial ten projects allowed us to
    build and renovate houses on our installations that would have cost
    $600 million more had we used the traditional military construction
    approach. By leveraging available resources, we can revitalize housing
    on other military installations.
        In terms of future steps, the Department plans to build on our
    earlier privatization successes by simplifying the process,
    accelerating project execution, and institutionalizing best practices
    in the services' deals with the private sector. We plan to sharpen our
    post-award management to ensure fiscal integrity and sound project
    management.

                          IMPROVING BUSINESS PRACTICES

        Our installations' management approach extends to improving our
    business practices. The Secretary of Defense is committed to improving
    the way the Department operates and reducing total ownership costs, and
    one of the methods is through improved information technology (IT)
    systems. The installations' community is a frontrunner in the
    development and use of IT systems to improve the way we manage
    facilities.
        For example, in the fiscal year 2000 chief financial officer's
    (CFO) financial statement, we estimated the funding requirements for
    sustainment, since we had no system to capture or forecast sustainment
    requirements. Now, using the Facilities Sustainment Model which applies
    industry benchmarks for sustainment costs, we are able to precisely
    identify the requirements. Thus, sustainment costs in financial
    statements for fiscal years 2003 and beyond will be based on accurate,
    verifiable information.
        Many of our decision-making tools and financial systems are linked
    to the Department's real property inventory databases. Currently, the
    Department maintains many divergent systems that should be modernized
    using the latest state of the art technology and improved business
    processes. We recently began an effort to improve the availability and
    accuracy of information on our physical plant. Our vision is to improve
    our processes by developing a standardized real property inventory
    information system called the Base Information System. The goal is to
    develop new processes and systems for inventorying real property that
    will allow users of real property information to easily share and gain
    access to the information. During this fiscal year, we will develop an
    enterprise architecture that will help us clearly identify our current
    state and processes, develop a ``to-be'' process and, finally, develop
    the road map for change.
        In addition to our information systems, we are emphasizing several
    management initiatives to improve the efficiency of our installations
    and reduce total ownership costs. For example, the facilities
    demolition program has eliminated almost 62 million square feet of
    excess and obsolete facilities since its inception in 1998, and we
    expect to exceed our goal to eliminate 80.1 million square feet by the
    end of fiscal year 2003. The costs avoided by demolition will also free
    up funding to sustain, restore and modernize other infrastructure in
    our inventory. The demolition program was expanded to include several
    defense agencies and will continue past its originally intended
    completion in 2003.
        We have actively solicited ideas to improve the operation and
    management of our installations and are currently developing evaluation
    criteria in order to determine if there are successful candidates for
    the Efficient Facilities Initiatives pilot program authorized in the
    National Defense Authorization Act for Fiscal Year 2002. The Department
    continues to consider opportunities for enhanced-use leasing, and we
    have established a working group to identify candidates and share
    lessons learned. We anticipate these leasing projects will enable
    better utilization of our infrastructure, reduce ownership costs,
    foster cooperation between the Department and private industry, and
    stimulate the local job market.
        Joint use has been another effective way to better utilize our
    facilities. For example, the Joint Mobility Center at Elmendorf Air
    Force Base, Alaska, saved the Air Force and Army up to 20 percent of
    the cost to build separate mobility facilities. In another recent case,
    the joint Armed Forces Reserve Center at Gray, Tennessee combined three
    construction projects for the Army Reserve, Army National Guard, and
    Marine Corps Reserve into a single facility project, saving millions of
    dollars.

                              FUTURE BASE CLOSURES

        Continuing to operate and maintain facilities we no longer need
    diverts scarce resources that could be better applied to higher
    priority programs, such as improving readiness, modernization, and
    quality of life for our service members. We need to seek every
    efficiency in the application of available resources to ensure we
    maintain just what we need to accomplish our missions. In the wake of
    the attacks of September 11, the imperative to convert excess base
    capacity into warfighting ability is enhanced, not diminished. With
    approximately 20 to 25 percent of our base infrastructure estimated to
    be excess to our needs, a significant financial benefit can be realized
    through Base Realignment and Closure (BRAC) 2005 infrastructure
    reductions.
        Prior BRAC actions have resulted in net savings to the Department
    of approximately $16 billion, with annual recurring savings of
    approximately $6 billion. We estimate that the next round of BRAC could
    save an additional $4 billion in annual recurring savings if the
    infrastructure reductions approximate the 12 percent reduction
    experienced in the last two rounds in 1993 and 1995. Greater reductions
    in excess capacity could produce greater annual recurring savings.
        BRAC 2005 is our most important facilities rationalization
    initiative. It will help the Department ultimately save several billion
    dollars annually. But a financial return is not the only benefit--in
    fact, it is not even the primary benefit. The authority to realign and
    close bases we no longer need will be a critical element of ensuring
    the right mix of bases and forces within our warfighting strategy as we
    transform the Department to meet the security challenges of the 21st
    century. Transformation requires rationalizing our base structure to
    better match the force structure for the new ways of doing business,
    and the Department will conduct this rationalization with an eye toward
    ensuring we look at base capacity across the military services for the
    best joint use possible.
        The Department is currently engaged in the upfront process of
    organizing and planning to accomplish the analysis and reporting
    requirements. We are building on the experiences gained in previous
    BRACs and using the additional time Congress has given us to finalize
    our approach. However, we have not officially ``kicked off'' the
    process.

                 UTILITIES PRIVATIZATION AND ENERGY MANAGEMENT

        The Department seeks to reduce its energy consumption and the
    associated costs, while improving utility system reliability and
    safety. To accomplish this, DOD has developed an integrated program
    that optimizes utility system management by conserving energy and
    water, taking advantage of restructured energy commodity markets, and
    privatizing our utilities infrastructure.
        Conserving energy saves the Department money that can be invested
    in readiness, facilities sustainment, and quality of life. Energy
    conservation projects make business sense, historically obtaining about
    four dollars in life-cycle savings for every dollar invested. This
    dynamic becomes even more important when you consider that military
    installations spent nearly $2.8 billion in fiscal year 2001 to buy
    energy commodities (almost $400 million more than the previous year--a
    16 percent increase), despite reducing their energy use by about 3
    trillion BTUs (a 1 percent reduction). We continue to make progress in
    achieving the 2010 energy reduction goal for buildings of 35 percent
    per square foot and have reduced consumption by over 23 percent since
    1985.
        The Department has a balanced program for energy conservation--
    installing energy savings measures using appropriated funding and
    private-sector investment-combined with using the principles of
    sustainable design to reduce the resources used in our new
    construction. The fiscal year 2003 budget contains $50 million for the
    Energy Conservation Investment Program (ECIP) to implement energy
    savings measures in our existing facilities.
        The Department places a high priority on privatizing utilities.
    However, we have found implementation to be more difficult than
    originally envisioned. We have made progress and will continue to move
    forward on the privatization of our utility infrastructure in areas
    where it makes economic sense. Privatization allows the military
    departments to focus on core defense missions by relieving them of
    those installation management functions that can be done more
    efficiently and effectively by non-Federal entities. Historically,
    military installations have been unable to upgrade and maintain utility
    systems fully due to inadequate funding and competing installation
    management priorities. Utilities privatization will allow military
    installations to benefit from private-sector financing and efficiencies
    to obtain improved utility systems and services.

                             ENVIRONMENTAL PROGRESS

        The Department's environmental program is focused on four
    overarching principles. First, environment is a fundamental component
    of our national power. We must be ever vigilant in ensuring lack of
    attention to environment does not undermine or degrade our national
    power. Second, environmental stewardship is a component of good
    business management. The Department is fully committed to implementing
    environmental management systems to improve efficiency and integrate
    environment into day-to-day operations. Third, environmental
    stewardship reflects the high ethical standards of our soldiers,
    sailors, marines, and airmen. Fourth, completing environmental
    remediation quickly, effectively, and safely, to protect human health
    and the environment from the results of past contamination, is
    important, both at our active and BRAC installations, as well as
    formerly used defense sites (FUDS) and surrounding communities. We are
    committed to continuing to be a leader in the Federal Government in
    environmental management, and our fiscal year 2003 budget request,
    highlighted in the table below, reflects this commitment to ensuring
    environment fully supports our defense mission.

                    ENVIRONMENTAL PROGRAM--SUMMARY OF REQUEST
                   [President's budget in billions of dollars]
    ------------------------------------------------------------------------
                                                        Fiscal      Fiscal
                                                       Year 2002   Year 2003
                                                        Request     Request
    ------------------------------------------------------------------------
    Cleanup.........................................       1,247       1,278
    BRAC............................................         491         520
    Compliance......................................       1,623       1,706
    Pollution Prevention............................         245         247
    Conservation....................................         138         152
    Technology......................................         211         205
                                                     -----------------------
      Total.........................................       3,955       4,108
    ------------------------------------------------------------------------

        To maintain our ability to defend our country against terrorism and
    other security threats, our forces have conducted--and must continue to
    conduct--training and operations on land, at sea, and in the air.
    Environmental degradation can deny access to lands, undermine the
    realism and effectiveness of training, limit operational flexibility or
    productivity, and pose safety risks. Hence, cleaning up past
    contamination is important to sustain the land we hold in the public
    trust. Through the Defense Environmental Restoration Program, we are
    working to cleanup past contamination in all 50 States, the District of
    Columbia, and 8 U.S. territories. This program covers environmental
    restoration activities at active installations, installations that are
    closing or have had their missions realigned, and formerly used defense
    sites.
        Our environmental restoration request is $1.3 billion for fiscal
    year 2003, slightly higher than in our fiscal year 2002 request. We are
    proud of our cleanup successes, but acknowledge that we still have some
    complex issues to address. The Department has built a strong
    environmental cleanup program over the last two decades and is charting
    a course for completing our environmental restoration requirements.
        The environmental cleanup at current BRAC installations continues
    to serve as a model for collaboration among Department cleanup and real
    estate professionals, Federal and State regulators, and communities in
    integrating reuse with cleanup. We have completed environmental cleanup
    requirements under the Comprehensive Response, Compensation, and
    Liability Act (CERCLA) at 84 percent of land slated for transfer from
    the Department. To continue the remaining environmental cleanup
    required at previous BRAC installations, we are requesting $520
    million, $29 million more than was requested last year.
        We are also building on the requirements of Executive Order 13148,
    Greening the Government Through Leadership in Environmental Management,
    to improve our business practices. We have recently undertaken an
    initiative to implement environmental management systems across all
    missions, activities, and functions. Industry leaders have shown us
    that effective environmental management systems will enable the
    Department to leverage its environmental investment to reduce mission-
    driven risks and associated compliance costs. We believe successful
    implementation of environmental management systems in the Department is
    essential to maintain and improve readiness, mission efficiency, and
    environmental stewardship in light of the increasingly demanding
    national security and environmental requirements of the 21st century.
        The fiscal year 2003 environmental quality request for $2.1 billion
    includes $1.7 billion for compliance, $250 million for pollution
    prevention, and $152 million for conservation. This will allow us to
    continue to comply with environmental laws and regulations and to
    effectively reduce the amount of pollutants we generate in performing
    the defense mission. These funds are a good defense investment. As of
    the end of fiscal year 2001, the Department reduced the number of new
    environmental violations received by 75 percent since 1992, reduced the
    amount of hazardous waste generated by over 60 percent, and completed
    Integrated Natural Resource Management Plans at the vast majority of
    bases.
        For several years, the Department has worked to integrate
    environmental, safety, and occupational health considerations into
    defense acquisition weapon system programs. We believe that smart
    consideration of environmental concerns during the acquisition process
    is the key to efficient, cost effective, and environmentally sound
    weapon system performance.
        We have revised the Directives that impact the major weapon system
    acquisition programs for the Department. These changes clarify and
    strengthen the management of life-cycle environmental issues by
    integrating them into the overall acquisition program management
    process. The new language also drives reduction in the procurement and
    use of hazardous materials to ensure waste minimization and pollution
    prevention are institutionalized in the acquisition process. In
    addition, the program manager is required to assess the life-cycle
    environmental impacts of the weapon system to identify opportunities
    for source reduction and recycling to minimize these impacts. These
    changes help reduce the cost and impact of these weapons systems on the
    people who make them, use them, maintain them, and live around
    installations where they are stationed. Such improvements in today's
    weapon system acquisitions will have far-reaching positive impacts on
    ``green'' initiatives at all of our installations for many years to
    come.
        Since sound environmental policy is the foundation of future
    improvement in environmental performance, we provided greater emphasis
    on promoting teamwork between environmental and procurement personnel
    to realize the benefit of affirmative procurement policy goals. All of
    these changes have improved our performance of purchasing
    environmentally preferable products, which has reduced our potential
    environmental impact on both the communities around our installations
    as well as our own personnel.
        The Department is fully committed to military explosives safety--
    protecting military members and the public from the adverse effects of
    munitions. Last year, after an in-depth review, we divided our
    challenge into two areas of responsibility: Operational Ranges and
    Munitions Response Areas.
        Our operational ranges are needed today and tomorrow. We fully
    appreciate the need for good stewardship and, as a part of our Range
    Sustainment Initiative, we are reviewing how we look at and manage our
    operational ranges. Most immediately, the Department is clarifying our
    operational range clearance policy. We are also developing the
    protocols for determining and responding to any groundwater
    contamination under our operational ranges. For our Munitions Response
    Areas, which include all property which may have unexploded ordnance,
    abandoned munitions, or munitions constituents, and we are building on
    the authority provided to us with the Defense Environmental Restoration
    Program. In so doing, the Department intends to fully comply with
    sections 311, 312, and 313 of the National Defense Authorization Act
    for Fiscal Year 2002, Public Law 107-107, which call for several
    significant items, including a site inventories, cost projections, and
    a technology roadmaps.

                                  ENCROACHMENT

        Civilian encroachment at active military bases and test and
    training ranges can interfere with the ability of our military to carry
    out their missions and can degrade the training and readiness of our
    military personnel at a time we need them most. Encroachment involves
    buildings and structures protruding into navigable air space;
    residential development locating in noisy, high performance aircraft
    approach and departure corridors or too close to gunnery ranges; or it
    can be off-base electrical transmissions interfering with air and
    ground communications. The presence of endangered species or their
    critical habitats in or near gunnery and bombing ranges also
    contributes to encroachment problems.
        Urban growth and development is the most visible form of
    encroachment and has the greatest impact on military operations,
    training, and readiness. Encroachment of incompatible civilian
    activities in whatever form--if allowed to go unmanaged and
    unregulated--will continue to compromise the effectiveness of our
    military forces. Since maintaining the readiness of our forces is one
    of the highest priorities of the Department, we strive to maintain a
    reasonable balance between test and training requirements, the concerns
    of our neighbors near our test and training ranges, and the importance
    of sound environmental stewardship. All of our military services are
    prepared to work with appropriate State and local authorities to
    control and hopefully curtail encroachment on both sides of the fence
    line.
        We are addressing encroachment by developing a comprehensive
    strategy that will consider test and training mission needs, regulatory
    requirements, community support, urban encroachment, and the current
    and projected capability of our ranges to support the mission. The
    Deputy Secretary of Defense established a full time Integrated Product
    Team in the Office of the Under Secretary of Defense for Personnel and
    Readiness to act as the Department's coordinating body for overall
    range encroachment issues. This IPT, which reports to the Senior
    Readiness Oversight Council, has been tasked with developing a
    comprehensive set of proposals to address the encroachment issue.

                              ENABLING LEGISLATION

        Consistent with our work to improve installations and environmental
    business practices, we are developing specific military construction
    legislation that will enable us to conduct our work more efficiently at
    lower cost. The legislation Congress enacted during fiscal year 2002
    greatly improved the Department's freedom to manage, and the
    legislation currently under consideration by the Department will
    continue that trend without diminishing our accountability.

                                   CONCLUSION

        Our fiscal year 2003 budget request for military construction and
    for the Department's environmental programs supports the Department's
    obligation to acquire and maintain facilities vital to our changing
    missions and readiness. America's security, today and in the future,
    depends on installations and facilities that support operational
    readiness and changing force structures and missions. We have slowed
    the deterioration of our facilities, and will, over time, fully restore
    their readiness. With the Defense Facilities Strategic Plan as our
    guide, we are committed to providing and supporting healthy
    installations, facilities, and housing that will enhance readiness,
    morale, and quality of life for our service members and civilians. This
    installations' transformation will continue until all of our facilities
    meet the requirements of a 21st century military.
        We will also continue to identify opportunities to operate more
    efficiently and leverage our resources through partnerships with the
    private sector on housing and utilities privatization and competitive
    sourcing initiatives. We are committed to divesting ourselves of
    unneeded, underutilized facilities through the Efficient Facilities
    Initiative, facilities demolition, outleasing, and other facility
    reduction initiatives.
        As a leader in environmental management, we will complete
    environmental remediation quickly and effectively at both our current
    and former installations and will protect our service members and
    others from the results of past contamination. In addition, we are
    developing a strategy to address encroachment that considers the needs
    of everyone involved.
        In closing, Mr. Chairman, I sincerely thank you for providing me
    this opportunity to describe the Department's plan for revitalizing our
    installations and facilities and for your very strong support for a
    robust military construction program. I look forward to working with
    you as we transform our plans into actions.

        Senator Akaka. Secretary Fiori.

     STATEMENT OF HON. MARIO P. FIORI, ASSISTANT SECRETARY OF THE
                  ARMY (INSTALLATIONS AND ENVIRONMENT)

        Secretary Fiori. Mr. Chairman and members of the
    subcommittee: Thank you for the opportunity to present the
    Army's fiscal year 2003 budget for military construction and
    the environmental program. I have provided a detailed written
    statement for the record, but I want to comment briefly on the
    highlights of some of our programs.
        The Army has many challenges in front of it. Our goal is to
    ensure that all our garrisons throughout the world have an
    equal and outstanding level of services for our soldiers and
    their families. When I visited selected Army installations, I
    observed the progress that has already been made, and
    attributed much of this success directly to the longstanding
    support of this subcommittee and its staff.
        The Army's overall budget request for fiscal year 2003
    supports the Army vision--people, readiness, and
    transformation--and the strategic guidance to transform to a
    full-spectrum force while ensuring warfighting readiness. It
    reflects a balanced program that will allow the Army to remain
    trained and ready throughout fiscal year 2003 while ensuring we
    fulfil our critical role in the global war on terrorism.
        Our military construction budget request is $3.2 billion
    and will fund our highest priority facilities and family
    housing requirements. In fiscal year 2002 we presented a budget
    that was a down payment on our goal to better support our
    infrastructure.
        When we developed this year's budget in light of the events
    that took place last year, we had some very difficult decisions
    to make. The need to fund military pay raises, Army
    transformation, OPTEMPO, the war on terrorism, and increases in
    health care and other key programs were all included in the
    decision leading to our request. Thus, the Army budget provides
    the best balance between all of our programs, including
    military construction.
        A few critical areas in our construction request are Army
    transformation at Fort Lewis, Fort Wainwright, and Fort Polk.
    We have eight projects for $195 million included in the program
    to ensure transformation to continue to progress as envisioned
    by our leadership.
        Army family housing is a success this year. We are now on
    target to eliminate inadequate family housing through
    construction or privatization by 2007. Our budget includes $180
    million for the Residential Communities Initiative and the
    continued acquisition and transition of the 11 installations
    currently underway and 7 new installations, for a total of
    50,000 housing units. RCI is a great success story. I visited
    Fort Carson on Monday and I am delighted to report that the
    program is 3 months ahead of schedule. We now have 338 new
    units occupied, 500 units renovated, and we are building 20 new
    units a month and completing 40 renovations per month until we
    get all 2,600 done at Fort Carson. Fort Carson will be
    completed by 2004 instead of 2007.
        The combination of privatization and construction will meet
    our goal of fixing family housing 3 years earlier than was
    reported to you last year. A portion of our Military
    Construction and our family housing construction program this
    year is dedicated to overseas construction: 75 percent of the
    overseas military construction request will be used to provide
    better barracks for almost 3,000 soldiers, mainly in Europe and
    Korea.
        We are also constructing the new facilities to support
    Efficient Basing, East Initiative in Germany, which will
    consolidate 13 smaller installations into a single installation
    at Grafenwoehr. Two projects in our request will finalize the
    Army's construction requirements for the Efficient Basing,
    South Initiative in Italy, which will station a second airborne
    infantry battalion in Vicenza. Each project is vital to
    maintain a suitable working and living environment for our
    soldiers and families overseas.
        At the end of fiscal year 2003 we will have 106,000
    permanent party single soldier barracks, or 70 percent,
    modernized. Our strategic mobility program will be 100 percent
    funded and we will have completed all base closures and
    realignments and will concentrate this year on the final phases
    of disposal of these properties. The Army National Guard
    anticipates that 30 of the 32 Weapons of Mass Destruction Civil
    Support Team facilities will be initiated.
        Our sustainment, restoration, and modernization request is
    $2.4 billion, which provides 92 percent of our requirements. In
    1998, the Secretary of Defense set a goal to privatize,
    whenever economical, all utility systems on military
    installations by September 30, 2003. We are fully committed to
    utilities privatization and, to date, the Army has privatized a
    total of only 25 systems. For fiscal year 2002, we have
    proposals for 109 systems, and we expect to complete
    privatization of at least 35 of these 109 by the end of this
    fiscal year.
        Our enhanced use leases, real property exchanges, and
    energy saving performance contracts all contribute to taking
    care of our installations. This year, we initiated a pilot
    program which Congress approved to contract out the first 5
    years of maintenance in 3 of our military construction
    projects.
        The Army's fiscal year 2003 budget request for the
    environmental program is $1.6 billion, which is sufficient for
    our compliance, restoration, conservation, pollution
    prevention, and environmental quality technology programs. The
    environmental program fulfils a public trust to manage Army
    lands by protecting natural and cultural resources in
    accordance with Federal, State, and local laws. As we conduct
    sound environmental management of our 16.5 million acres of
    land, we will also provide our soldiers with tough, realistic,
    and battle-focused training.
        The Army does face significant environmental challenges as
    we transform the Army. Our weapons systems will be more
    maneuverable, have longer range firing capabilities, and this,
    of course, results in a much more serious concern for
    encroachment of our training facilities. We work closely with
    the Federal, State, and local agencies and the local
    communities to minimize the effects of encroachment.
    Unfortunately, we are experiencing varying levels of success in
    addressing restrictions on training ranges.
        For example, the successful agreement with the Governor of
    Massachusetts will allow the Army to use the Massachusetts
    Military Reservation for training. However, the reservation is
    the first active training installation that has had live-fire
    training prohibited by the Environmental Protection Agency
    (EPA). We are still facing challenges at the Makua Military
    Reservation, which is the only range facility in Hawaii that
    accommodates company-level combined live-fire training.
        Thus, the recent settlement agreement, which was a work-
    around, allowed us to resume live-fire training, but in a
    limited ability. Thus, to train the 25th Infantry Division, for
    example, we will need to complete some of the company-level
    training requirements in the Continental United States (CONUS),
    at an annual cost of $6.6 million. But, more importantly, this
    will require more of our soldiers to spend time away from home.
    Similarly, the Army Reserve, Army National Guard, and
    potentially the U.S. Marines will not have access to Makua for
    live-fire training.
        The majority of the Army environmental program focuses on
    the day to day environmental stewardship responsibilities of
    our 184 major installations worldwide. We have had measureable
    successes in creating environmental consciousness for the Army.
    For example, we are not polluters. Even with increasing
    regulatory inspections in 2001, our compliance record has
    improved.
        We are working toward fully implementing our environmental
    management system using the ISO-14001 standard. We have
    completed 85 of our active and 80 percent of our BRAC cleanup
    sites.
        Our management initiatives include comprehensive program
    reviews, innovative contracting, increased partnering, and
    stakeholder outreach. We have taken a cue from the private
    sector and developed a military version of the U.S. Green
    Building Council's Leadership in the Energy and Environmental
    Design building and rating system (LEED). We call this the
    Sustainable Project Rating Tool (SPRT) in the Army. This tool
    is used to evaluate our military construction projects in terms
    of their sustainability, how well we incorporate green building
    techniques such as recyclable building materials, energy
    efficiency, natural daylight, and compatibility with natural
    surroundings.
        The Army's conservation program is a crucial component of
    sustaining our natural and cultural resources. We comply with
    the National Historic Preservation Act and, with close working
    relationships with the National Trust and State historic
    preservation offices, we will manage our 77,000 buildings
    achieving middle age.
        We care for 170 threatened and endangered species on our
    installations. Our cultural and natural resources management
    plans will help us avoid future problems, reduce costs, and
    meet our environmental responsibilities.
        I want to conclude by telling you about one of the most
    important initiatives in the facilities arena, the way in which
    the Army will be managing installations. Last year, the
    Secretary of the Army approved the concept of centralized
    installation management through regional alignment. We will
    implement this new management structure on October 1, 2002. A
    top-down regional alignment creates a corporate structure with
    a sole focus on efficient and effective management of all our
    installations. It frees up our mission commanders to
    concentrate on readiness. They will still have an influence on
    important installation decisions, but not the day to day
    headaches.
        We believe centralized management will also enhance our
    ability to integrate the Active and Reserve components and to
    develop multifunctional installations to support the evolving
    transformation of our forces.
        In closing, Mr. Chairman, I look forward to continuing our
    work in caring for our soldiers and their families. Thank you,
    sir.
        [The prepared statement of Secretary Fiori follows:]

                   Prepared Statement by Hon. Mario P. Fiori

        Mr. Chairman and members of the subcommittee, it is a pleasure to
    appear before you to discuss both the active Army and Reserve
    components' military construction and the Army Environmental Program
    request for fiscal year 2003. This request includes initiatives of
    considerable importance to America's Army, as well as this
    subcommittee, and we appreciate the opportunity to report on them to
    you.
        This budget provides resources in our construction and family
    housing programs essential to support the Army's role in our national
    military strategy. It provides resources to comply with environmental
    regulations, to continue our efforts in cleaning up contamination from
    past practices, and to sustain the land and natural resources so
    important to the Army's training mission and the American people. The
    budget supports the Army's vision and transformation strategy.
        The program presented herein requests fiscal year 2003
    appropriations and authorization of appropriations of $1,476,521,000
    for military construction, Army (MCA); $1,405,620,000 for Army family
    housing (AFH); $101,595,000 for military construction, Army National
    Guard (MCNG); and $58,779,000 for military construction, Army Reserve
    (MCAR). There is no request this year for the Homeowners Assistance
    Fund, Defense.
        In addition, the program requests fiscal year 2003 appropriations
    and authorization of appropriations of $1,580,492,000 for the Army
    Environmental Program.
        At the turn of the century, the Army published its vision--people,
    readiness, and transformation--that defined how we meet the Nation's
    military requirements today and into the future. We started the arduous
    task of selftransformation that will allow us to continue to dominate
    conventional battlefields but also provide the ability to deter and
    defeat adversaries who rely on surprise, deception and asymmetric
    warfare to achieve their objectives.
        Army transformation was already well under way when the attacks on
    September 11, 2001, provided a new urgency to our efforts. By
    accelerating transformation, we will provide additional capabilities to
    the warfighting CINCs, enabling them to assure allies and friends;
    dissuade future military competition; deter any threats; and, if
    necessary, defeat any adversary.
        To meet the challenges of accelerating transformation and carrying
    out today's missions at home and abroad, the Army must sustain a force
    of high quality, well-trained people; acquire and maintain the right
    mix of weapons and equipment; and maintain effective infrastructure and
    power projection platforms to generate the capabilities necessary to
    meet our missions. Taking care of soldiers and families is a readiness
    issue and will ensure that a trained and qualified soldier and civilian
    force will be in place to support the Objective Force and the
    transformed Army.
        As the Army transforms, we must ensure that Army installations are
    transformed to meet the needs of the force. Army installations, both
    Active and Reserve component, must fully support our warfighting needs,
    while providing soldiers and their families with a quality of life that
    equals that of their peers in civilian communities.
        To support the transformation of our installations, the Secretary
    of the Army has approved the concept of centralized installation
    management through a regional alignment. The implementation date of the
    new management structure is October 1, 2002.
        The regional alignment creates a corporate structure with a sole
    focus on efficient and effective management of installations. Mission
    commanders can concentrate on readiness but still influence critical
    issues through the rating chain for Garrison Commanders and membership
    on the Installation Board of Directors.
        This approach will ensure standard and equitable delivery of
    services from installation to installation. It will also ensure that
    all tenants, including the Reserve components, are treated equally. It
    enables the Army to resource to standards.
        The future will increasingly trend toward multi-functional
    installations. Supporting transformation, geographic-based regions
    provide the maximum flexibility for the future. In the end, it will
    allow improved facilities provided to soldiers and their families and
    better permit us to implement our facilities strategy.

                              FACILITIES STRATEGY

        The Army's Facilities Strategy (AFS) is the centerpiece of our
    efforts to fix the current state of Army facilities over 20 years. It
    addresses our long-term need to sustain and modernize Army-funded
    facilities in both Active and Reserve components by framing our
    requirements for both sustainment, restoration, and modernization (SRM)
    and military construction (MILCON) funding. The AFS addresses
    sustainment, recapitalization, quality and quantity improvements, and
    new mission requirements so that the Army will have adequate facilities
    to support our 21st century missions. SRM includes funds for annual
    maintenance and scheduled repair--sustainment; and military
    construction funding to repair or replace facilities damaged due to
    failures attributable to inadequate sustainment or emergencies or to
    implement new or higher standards--restoration and modernization.
        The first pillar of the strategy requires us to halt further
    deterioration of our facilities. Our sustainment funding, which comes
    from the operation and maintenance (O&M) SRM accounts, has greatly
    improved thanks to the support from Congress. We are funded at over 90
    percent of our requirements in fiscal year 2003. This level of funding
    may be sufficient to prevent further deterioration of Army facilities.
    Our current C-3 conditions are a result of years of underfunding. We
    must have sufficient O&M SRM resources to sustain our facilities and
    prevent facilities from deteriorating further, or we put our MILCON
    investments at risk.
        The second pillar of the strategy is to tackle the enormous backlog
    that has grown over numerous years of underfunding. Since we can't
    afford a quick fix to buy down the SRM backlog, we will centrally
    manage resources towards focused investments. This capital investment
    requirement will primarily require MILCON funding, supplemented by O&M
    SRM project funding. Our goal is to raise Army facilities from current
    C-3 ratings to C-2 by the end of 2010 by bringing a focused set of
    facilities to C-1 during that timeframe. Also, we plan to eliminate
    facility shortfalls where they exist over the entire 20-year strategy.
    These shortfalls are a result of facilities modernization not keeping
    pace with our weapons modernization and supporting force structure.
        We are basing the initial focused set of facilities on commanders'
    ratings in our Installation Status Report. The facilities we chose to
    modernize under this centrally managed program are critical to the
    Army's mission and to our soldiers. It is essential that both the
    sustainment (O&M SRM) and the capital investment (MILCON and O&M SRM)
    pieces be funded as a single, integrated program.
        The third (recapitalization) and fourth (new mission) pillars of
    our strategy address improving recapitalization of our facilities to a
    67-year cycle and ensuring adequate facilities keep pace with future
    force structure changes and weapons modernization programs (such as
    transformation). These four pillars will enable us to improve the
    health of Army real property and its ability to successfully support
    our worldwide missions and our soldiers.
        In addition to implementing our facilities strategy, we continue
    our policy of eliminating excess facilities throughout the entire Army
    to allow us to use our limited resources where they have the most
    impact. During fiscal years 1988-2003, our footprint reduction program,
    along with the base realignment and closure process, will result in
    disposal of over 200 million square feet in the United States. We
    continue our policy of demolishing at least one square foot for every
    square foot constructed. By 2003, with our overseas reductions
    included, the Army will have disposed of over 400 million square feet
    from its fiscal year 1990 peak of 1,157,700,000 square feet.
        Additionally, we are pursuing innovative ways to modernize our
    infrastructure and reduce the cost of our facilities. One example is
    installation utilities systems. Our goal is to privatize all utility
    systems in CONUS by 2003, where it is economically feasible, except
    those needed for unique security reasons. We are also expanding the
    privatization of military family housing in an effort to provide
    quality residential communities for soldiers and their families.

                       MILITARY CONSTRUCTION, ARMY (MCA)

        This year's MCA program focuses on six major categories of
    projects: mission facilities, transformation, well-being, efficient
    basing, installation support, and chemical demilitarization. I will
    explain each area in turn.

                               MISSION FACILITIES

        In fiscal year 2003, there are 10 mission facility projects to
    ensure the Army is deployable, trained, and ready to respond to meet
    its national security mission. Projects in this program conclude the
    successful Army Strategic Mobility Program (ASMP) to ensure deployment
    within specified timelines; provide enhanced training via live-fire
    ranges and simulators; and maintain equipment readiness by ensuring
    Army vehicles are repaired and operational.
    Army Strategic Mobility Program
        The six mobility projects in our fiscal year 2003 budget request
    facilitate movement of personnel and equipment from CONUS bases for
    both the Active and Reserve components to meet Army and Defense
    timelines for mobilization operations. They are part of an important
    program started in the early 1990's to upgrade our strategic mobility
    infrastructure, enabling the Army to maintain the best possible power
    projection platforms. We are requesting $53.6 million. The fiscal year
    2003 projects will complete the Strategic Mobility program. A follow-on
    program, Army Power Projection Program (AP3), is being implemented as a
    result of changes in force structure and stationing.
        The six projects in our request include improving our deployment
    capability by upgrading a deployment facility at Fort Stewart, Georgia;
    constructing a truck loading/unloading facility at Fort Carson,
    Colorado; and providing ammunition storage/outloading facility
    improvements at Anniston Army Depot, Alabama, Blue Grass Army Depot,
    Kentucky, and Letterkenny Army Depot, Pennsylvania. In addition, to
    improving fuel storage, we plan to consolidate multiple fuel points at
    Fort Bragg, North Carolina, into one modern facility.
    Training and Readiness
        To improve soldier training, we are requesting $23.8 million to
    construct four training and readiness projects. Our request includes a
    Modified Record Fire Range at Darmstadt, Germany, and a live-fire shoot
    house at Fort Drum, New York. These ranges will provide our soldiers
    with realistic, state-of-the-art marksmanship training. We are also
    requesting a Military Operations in Urban Terrain (MOUT) Urban Assault
    Course at Fort Benning, Georgia, that will provide realistic urban
    combat training necessary for many scenarios in today's environment. A
    Tactical Vehicle Simulator facility at Fort Leonard Wood, Missouri, is
    requested to train new motor transport operators with our new vehicle
    simulators.

                                 TRANSFORMATION

        Our budget contains $194.9 million for eight projects at three
    installations, Fort Lewis, Washington; Fort Wainwright, Alaska; and
    Fort Polk, Louisiana, that support the deployment, training, unit
    operations, and equipment maintenance and motor pool facilities of the
    Interim Brigade Combat Team (IBCT) new transformed force. These
    projects include one maintenance facility for new vehicles, three
    ranges, a Military Operations in Urban Terrain (MOUT) facility, a
    Battle Simulator Center, and a Mission Support Training Facility to
    ensure our forces are properly trained, and a Battalion Headquarters/
    Company Operations Facility to provide a command and control facility
    for the increased unit size. We will continue to identify and validate
    additional requirements associated with transformation and will include
    these projects in future budgets.

                             EFFICIENT BASING, EAST

        The Army is requesting the first year of a 5-year plan to support
    the Efficient Basing, East initiative in Germany. The initiative will
    move a Brigade Combat Team to Grafenwoehr from 13 smaller installations
    over a 5-year time frame. This year's budget requests three projects at
    Grafenwoehr totaling $69.9 million. Army construction for the entire
    initiative is expected to cost $596 million. The three projects in this
    year's budget will complete the site preparation for the brigade,
    construct infrastructure to and around the brigade complex, and
    renovate existing barracks to the current Army standard. These projects
    will support the Brigade headquarters element.

                              WELL-BEING PROJECTS

        Fifty-four percent of our MCA budget is dedicated to providing for
    the well-being of our soldiers, their families, and civilians. Although
    our first priority is to move permanent party soldiers out of gang-
    latrine type barracks, we are also requesting Phase II of the Basic
    Combat Trainee barracks project at Fort Jackson, South Carolina, that
    was authorized in fiscal year 2002. We are also requesting two child
    development centers, one physical fitness center, and the expansion of
    a community support center. These projects will improve not only the
    well-being of our soldiers and families, but also the readiness of the
    Army. We are requesting $796.8 million for well-being projects this
    year.
    Whole Barracks Renewal Program
        Modernization of barracks for enlisted permanent party soldiers
    continues to be the Army's number one facilities' priority for military
    construction. It provides single soldiers with a quality living
    environment. The new complexes provide increased personal privacy,
    larger rooms, closets, new furnishings, adequate parking, and
    landscaping. In addition, administrative offices are separated from the
    barracks. With the approval of our budget, as requested, 77 percent of
    our barracks requirement will be funded at the new standard for our
    permanent party soldiers. Between fiscal years 2004 and 2009, we plan
    to invest an additional $4.0 billion in MCA and host nation funds,
    supplemented by $400 million in SRM funding to achieve our goal of
    providing improved living conditions for all of our single soldiers by
    fiscal year 2009. While we are making considerable progress at
    installations in the United States, we will request increased funding
    for Germany and Korea in future budgets to compensate for these areas
    having been historically funded at lower levels than installations in
    the United States. A large portion of the remaining modernization
    effort, 41 percent, is in these overseas areas.
        In fiscal year 2003, we are planning 21 barracks projects. This
    includes 4 projects in Europe and 5 projects in Korea. The
    installations with the largest investment are Fort Bragg, North
    Carolina, with $100 million (2 projects), and Schofield Barracks,
    Hawaii, with $91 million (2 projects). Large soldier populations and
    poor barracks conditions require sustained high investment through
    fiscal year 2008 at both of these installations to provide quality
    housing. We are completing a complex at Fort Carson, Colorado, which
    was authorized in fiscal year 2002; and we are continuing second phases
    at Fort Lewis, Washington, and Fort Richardson, Alaska, which were also
    fully authorized in fiscal year 2002. At Fort Campbell, Kentucky, we
    are requesting authorization for all phases of a multi-phase barracks
    complex; however, we are only requesting the appropriation needed for
    the fiscal year 2003 phase. Our plan is to award each complex, subject
    to subsequent appropriations, as a single contract to gain cost
    efficiencies, expedite construction, and provide uniformity in building
    systems. Barracks projects are also requested for Fort Hood, Texas;
    Fort Riley, Kansas; Fort Benning, Georgia; and Fort Detrick, Maryland.
    Basic Combat Training Complexes
        We are requesting Phase 2 to complete the Basic Combat Training
    complex at Fort Jackson, South Carolina, that was authorized in fiscal
    year 2002. This project will provide a modern, initial entry basic
    training complex that includes separate and secure housing to support
    gender-integrated training, and provides for the administrative and
    training functions that are organic to the mission of the basic
    training battalion.
    Community Facilities
        Our budget request includes two new child development centers to
    replace failing or inadequate facilities in Bamberg, Germany, and
    Vicenza, Italy. To improve soldier physical fitness and community
    wellness, our budget includes a physical fitness training center at
    Camp Castle, Korea. The expansion of a Community Support Center at Fort
    Detrick, Maryland, is also included in our request.

                         INSTALLATION SUPPORT PROGRAMS

        This category of construction projects provides vital support to
    installations and helps improve their readiness capabilities. We are
    requesting one project for a Centralized Wash Facility at Schweinfurt,
    Germany, $2 million. A classified project is also requested at $4
    million.

                          AMMUNITION DEMILITARIZATION

        The Ammunition Demilitarization (Chemical Demilitarization) Program
    is designed to destroy the U.S. inventory of lethal chemical agents,
    munitions, and related (non-stockpile) materiel. It also provides for
    emergency response capabilities, while avoiding future risks and costs
    associated with the continued storage of chemical warfare materiel.
        The Office of the Secretary of Defense devolved the Chemical
    Demilitarization Program to the Department of the Army in fiscal year
    1999. Although Congress has consistently authorized and appropriated
    funding for the Chemical Demilitarization Construction Program to the
    Department of Defense, the overall responsibility for the program
    remains with the Army and we have included it in this year's Army
    budget.
        We are requesting $167.6 million in the Army's fiscal year 2003
    budget to continue the Chemical Demilitarization projects previously
    authorized, and a Non-Stockpile Chemical Munitions Facility at Pine
    Bluff, Arkansas. Table 1 summarizes our request:

                            TABLE 1--FISCAL YEAR 2003
    ------------------------------------------------------------------------
               Installation                     Type              Amount
    ------------------------------------------------------------------------
    Aberdeen PG, MD...................  Ammun Demil             $ 30,600,000
                                         Facility, Phase V.
    Blue Grass AD, KY.................  Ammun Demil               10,300,000
                                         Facility, Phase III.
    Blue Grass AD, KY.................  Support Facility,          8,300,000
                                         Phase III.
    Newport AD, IN....................  Ammun Demil               61,494,000
                                         Facility, Phase V.
    Pine Bluff AD, AR.................  Non-Stockpile             18,937,000
                                         Munitions Facility.
    Pueblo AD, CO.....................  Ammun Demil               38,000,000
                                         Facility, Phase IV.
                                                             ---------------
      Total...........................    ..................    $167,631,000
    ------------------------------------------------------------------------

        The destruction of the U.S. stockpile of chemical weapons is a
    major priority of the Army, DOD, and the administration. These chemical
    weapons must be destroyed to reduce the risk to the stockpile storage
    communities and eliminate these weapons as potential terrorist targets.
    The MILCON funding for the chemical weapons facilities is essential to
    achieving this goal.

               PLANNING AND DESIGN/UNSPECIFIED MINOR CONSTRUCTION

        The fiscal year 2003 MCA budget includes $119.8 million for
    planning and design. The fiscal year 2003 request is a function of the
    construction programs for 3 fiscal years: 2003, 2004, and 2005. The
    requested amount will be used to design-build a portion of the fiscal
    year 2003 program, complete design in fiscal year 2004, and initiate
    design of fiscal year 2005 projects.
        Host Nation Support (HNS) Planning and Design (P&D): the Army, as
    Executive Agent, provides HNS P&D for oversight of Host Nation funded
    design and construction projects. The U.S. Army Corps of Engineers
    oversees the design and construction to ensure the facilities meet our
    requirements and standards. Lack of oversight may result in an increase
    in design errors and construction deficiencies that will require United
    States dollars to rectify. Maintaining the funding level for this
    mission results in a payback where $1 of United States funding gains
    $36 worth of Host Nation Construction. The fiscal year 2003 budget
    request for $23.7 million will provide oversight for approximately $850
    million of construction in Japan, Korea, and Europe.
        The fiscal year 2003 budget also contains $20.5 million for
    unspecified minor construction.

                              ARMY FAMILY HOUSING

        The family housing program provides a major incentive that is
    necessary for recruiting and retaining dedicated individuals to serve
    in the Army. Adequate and affordable housing continues to be a major
    concern to soldiers when asked about their quality of life. We have
    waiting lists at nearly all of our major posts and as of January 2,
    2002, the out-of-pocket expenses for soldiers living off post were
    approximately 11.3 percent of the total cost of their housing. The Army
    supports the initiative to increase the Basic Allowance for Housing
    (BAH) to eliminate the out-of-pocket costs being paid by service
    members for off-post housing in the United States by 2005. Maintaining
    and sustaining safe, attractive, and convenient housing for our
    soldiers and families is one of our continuing challenges. This budget
    represents an increase in the family housing program for family housing
    improvements and expanded privatization. This increase will assist us
    in providing improved housing quicker and to more of our military
    families. Our current plan ensures we meet the Secretary of Defense's
    goal of 2007 to provide adequate housing to all military families.
        Privatization is an essential element in solving our acute family
    housing problem. The Army's privatization program, Residential
    Communities Initiative (RCI), utilizes the authorities granted by
    Congress in 1996 and extended to December 31, 2012 to implement an
    aggressive program to create modern residential communities in the
    United States. The Army is leveraging appropriated funds and government
    assets by entering into long-term partnerships with private sector real
    estate development and management firms to obtain financing and
    management expertise to construct, repair, maintain, and operate Army
    family housing communities.
        The RCI program includes projects at Fort Carson, Colorado; Fort
    Hood, Texas; Fort Lewis, Washington; and Fort Meade, Maryland. Fort
    Carson transitioned to privatized operations in November 1999, and Fort
    Hood transitioned in October 2001. Forts Lewis and Meade are expected
    to transition by mid-2002. The projects include over 15,000 housing
    units. Army families have already moved into new and renovated housing
    at Fort Carson and our experience to date has been very positive.
        The program is expanding to 20 additional privatization projects
    between fiscal years 2002 and 2004. These projects will privatize more
    than 48,000 additional housing units. Using funds appropriated in
    fiscal year 2002, the Army kicked-off nine projects. The 2003 budget
    request will continue to expand the program, adding five projects
    covering seven installations (Fort Polk, Louisiana; Fort Belvoir,
    Virginia; Forts Eustis and Story, Virginia; Fort Leonard Wood,
    Missouri; and Fort Shafter and Schofield Barracks, Hawaii).
        The Army is using the development partners' experience and
    resources, and market-based incentives, to bring about dramatic
    improvements in the Army family housing and the quality of life for
    soldiers and their families.
        Our fiscal year 2003 request for Army Family Housing is
    $1,405,620,000. Table 2 summarizes each of the categories of the Army
    Family Housing program.

                          TABLE 2--ARMY FAMILY HOUSING
                                Fiscal Year 2003
    ------------------------------------------------------------------------
                    Facility Category                   ($000)      Percent
    ------------------------------------------------------------------------
    New Construction................................      27,942           2
    Post Acquisition Const..........................     239,751          17
    Planning and Design.............................      15,653           1
    Operations......................................     183,408          13
    Utilities.......................................     212,432          15
    Maintenance.....................................     485,257          35
    Leasing.........................................     215,251          15
    Privatization...................................      25,926           2
                                                     -----------------------
      Total.........................................   1,405,620         100
    ------------------------------------------------------------------------

                          FAMILY HOUSING CONSTRUCTION

        The total fiscal year 2003 request for construction is
    $283,346,000. It continues the Whole Neighborhood Revitalization (WNR)
    initiative approved by Congress in fiscal year 1992 and supported
    consistently since that time. This successful approach addresses the
    entire living environment of the military family. The projects are
    based on life-cycle economic analyses and support the Department of
    Defense's 2007 goal by providing units that meet current construction
    and adequacy standards.
    New Construction
        The fiscal year 2003 new construction program provides WNR projects
    at four locations. Replacement construction provides adequate
    facilities where there is a continuing requirement for the housing and
    it is not economical to renovate. All of these projects are supported
    by housing surveys, which show that adequate and affordable units are
    not available in the local community.
    Post Acquisition Construction (Renovation)
        The Post Acquisition Construction Program is an integral part of
    our housing revitalization program. In fiscal year 2003, we are
    requesting funds for improvements to 18,314 existing units at 9
    locations in the United States, including privatization at 7
    installations; 7 locations in Europe; and 1 site in Korea. Included
    within the scope of these projects are efforts to improve supporting
    infrastructure and energy conservation.

                   FAMILY HOUSING OPERATIONS AND MAINTENANCE

        The operations, utilities, maintenance, and leasing programs
    comprise the majority of the fiscal year 2003 request. The requested
    amount of $1,122,274,000 for fiscal year 2003 is approximately 80
    percent of the total family housing budget. This budget provides for
    the Army's annual expenditures for operations, municipal-type services,
    furnishings, maintenance and repair, utilities, leased family housing,
    and funds supporting the Military Housing Privatization Initiative.

                             FAMILY HOUSING LEASING

        The leasing program provides another way of adequately housing our
    military families. We are requesting $215,251,000 in fiscal year 2003
    to fund existing section 2835 project requirements, temporary domestic
    leases in the United States, and approximately 8,600 units overseas.
               military construction, army national guard (mcng)
        The Army National Guard's (ARNG) focus is on two categories of
    projects: transformation and mission.

                                 TRANSFORMATION

        This year we continue converting twelve brigades and two division
    slices to support the Army Division Redesign Study (ADRS). The ADRS is
    a high priority for this budget. Eight facilities will be constructed
    or converted to house the ARNG's Combat Support/Combat Service Support
    structure. We are requesting $26.8 million for this transformation for
    facilities in Alabama and North Carolina and two projects each in
    California, Kansas, and Nebraska.

                                    MISSION

        In fiscal year 2003, the ARNG has requested $55.2 million for five
    mission projects. Two projects are in Wisconsin and will replace part
    of the existing United States Property and Fiscal Office complex made
    up of 23 buildings, ranging in year built from 1895 to 1980. These new
    facilities will permit all personnel to perform the necessary tasks
    that will improve their own readiness as well as provide fiscal and
    logistical support for the entire Wisconsin Army and Air National
    Guard.
        The first phase of a project for administrative buildings at
    Barbers Point, Hawaii is also included. These units are currently
    stationed in the Diamond Head State Monument area, in older, pre-World
    War II facilities. The renovation of an existing building at Barbers
    Point will help with the Diamond Head State Monument Plan, allowing the
    Monument area to revert back to a semi-wilderness condition.
        As part of the Army's Facility Strategy, we are requesting a
    Readiness Center at Summersville, West Virginia, and phase one of a
    joint facility with the Marine Corps Reserve and the Kansas Counterdrug
    Office at Topeka, Kansas.

               PLANNING AND DESIGN/UNSPECIFIED MINOR CONSTRUCTION

        The ARNG's fiscal year 2003 budget request contains $14.7 million
    for planning and design and $4.9 million for unspecified minor
    construction.

                   MILITARY CONSTRUCTION, ARMY RESERVE (MCAR)

        The fiscal year 2003 MCAR budget focuses on mission facilities that
    support the Army Reserve's mission of providing trained and ready unit
    and individuals to mobilize and deploy in support of the National
    Military Strategy.

                               MISSION FACILITIES

        In fiscal year 2003, there are seven mission facility projects in
    the Army Reserve's Military Construction program. These projects
    provide four Army Reserve Centers (Lincoln, Nebraska; Oswego, New York;
    Grand Prairie, Texas; and Fort Story, Virginia); four maintenance
    facilities (Mare Island, California; Lincoln, Nebraska; Grand Prairie,
    Texas; and Fort Story, Virginia); a battalion-size dining facility at
    Fort McCoy, Wisconsin; and an alteration to an Army Reserve training
    facility at Fort Bragg, North Carolina.

               PLANNING AND DESIGN/UNSPECIFIED MINOR CONSTRUCTION

        The fiscal year 2003 MCAR budget includes $6.965 million for
    planning and design and $2.85 million for unspecified minor
    construction.

                SUSTAINMENT, RESTORATION AND MODERNIZATION (SRM)

        In addition to military construction and family housing, the third
    area in the facilities arena is the O&M SRM program. O&M SRM is the
    primary account in the base support funding area responsible to
    maintain the infrastructure to achieve a successful readiness posture
    for the Army's fighting force. Installations and Reserve component
    facilities are the platforms of America's Army and must be properly
    maintained to be ready to support current Army missions and any future
    deployments.
        O&M SRM consists of two major functional areas: (1) facilities
    sustainment of real property and (2) restoration and modernization.
    Facilities sustainment provides resources for maintenance and repair
    activities necessary to keep an inventory of facilities in good working
    order. It also includes major repairs or replacement of facility
    components, usually accomplished by contract, that are expected to
    occur periodically throughout the life cycle of facilities. Restoration
    includes repair and replacement work to restore facilities damaged by
    inadequate sustainment, excessive age, natural disaster, fire,
    accident, or other causes. Modernization includes alteration of
    facilities solely to implement new or higher standards, including
    regulatory changes, to accommodate new functions, or to replace
    building components that typically last more than 50 years, such as
    foundations and structural members.
        Within the O&M SRM program, there are two areas to highlight: (1)
    our Barracks Upgrade Program (BUP) and (2) the Long Range Utilities
    Strategy. The first area is our BUP program, which is the major
    renovation and restoration of existing barracks and an integral part of
    the Barracks Modernization program's goal to eliminate gang-latrine
    barracks by 2008. However, due to the reallocation of central funding
    of the BUP program in fiscal year 2002, we will now complete the
    program in 2009. At the completion of the fiscal year 2003 program, as
    requested, we will have funded, with MILCON and BUP, adequate housing
    to meet or approximate the DOD 1+1 barracks standard for 77 percent of
    our soldiers. The fiscal years 2004-2008 Military Construction program
    will provide barracks for another 18 percent of eligible soldiers. We
    will use O&M SRM resources to renovate barracks to an approximate DOD
    1+1 standard for the remaining 5 percent of eligible soldiers. We are
    committing an average of about $120 million per year in O&M SRM to
    continue the efforts to upgrade housing for our single soldiers.
        The second area to highlight within the O&M SRM program is our Long
    Range Utilities Strategy to provide reliable and efficient utility
    services at our installations. Privatization or outsourcing of
    utilities is the first part of our strategy. All Army-owned electrical,
    natural gas, water, and wastewater systems are being evaluated to
    determine the feasibility of privatization. When privatization appears
    economical, we use competitive contracting procedures as much as
    possible. We continue to successfully privatize utility systems on Army
    installations. Recent successes include privatization of the natural
    gas system at Fort Benning, and the water and waste water systems at
    Presidio of Monterey. Of the 320 Army systems available for
    privatization since 1998, 24 have been privatized, 28 have been
    exempted, and the remaining are in various stages of privatization. The
    second part of the strategy is the utilities modernization program. We
    are upgrading utility systems that are not viable candidates to be
    privatized, such as central heating plants and distribution systems. We
    have executed approximately $188 million in utility modernization
    projects in fiscal years 1998 through 2001 and we plan to accomplish
    $83 million in additional projects in fiscal year 2002 to complete the
    program. Together, privatizing and modernizing utility systems will
    provide reliable and safe systems.
        We are making progress in upgrading barracks and improving utility
    services, and funding for the basic maintenance and repair of Army
    facilities has improved to 92 percent of the OMA, OMNG, and OMAR
    requirement in fiscal year 2003. However, we still need to strive
    toward fully funding sustainment to keep facilities from getting worse
    and to protect the large infrastructure investment requested in this
    budget. The Installation Status Report (ISR) shows Army facilities are
    rated C-3 (not fully mission capable) due to years of under-funding. At
    the end of fiscal year 2001, the ISR for the Army showed 28 percent of
    our facilities were ``red''--mission failure; 42 percent were
    ``amber''--mission degraded; and only 30 percent were ``green''--
    mission supported.

                      HOMEOWNERS ASSISTANCE FUND, DEFENSE

        The Army is the executive agent for the Homeowners Assistance
    Program. This program provides assistance to homeowners by reducing
    their losses incident to the disposal of their homes when military
    installations at or near where they are serving or employed are ordered
    to be closed or the scope of operations reduced. For fiscal year 2003,
    there is no request for appropriations and authorization of
    appropriations. Requirements for the program will be funded from prior
    year carryover and revenue from sale of homes. Assistance will be
    continued for personnel at 7 installations that are impacted with
    either a base closure or a realignment of personnel, resulting in
    adverse economic effects on local communities.

                          BASE REALIGNMENT AND CLOSURE

        Our facilities strategy strives to meet the needs of today's
    soldiers while also focusing on the changes required to support the
    Army of the 21st century. For BRAC in fiscal year 2003, we are
    requesting appropriations and authorization of appropriations of $149.9
    million. This budget represents the Army's budget required to continue
    unexploded ordnance (UXO) removal, environmental restoration, and
    property management of those facilities not yet disposed from the first
    four rounds of BRAC. In fiscal year 2001, the Army began saving $945
    million annually upon completion of the first four rounds of BRAC.
    Although these savings are substantial, we need to achieve even more,
    and bring our infrastructure assets in line with projected needs. The
    Army supports the need to close and realign additional facilities and
    we appreciate Congress' authority to have an additional round in fiscal
    year 2005.
        The Army is now in the first year of exclusively care taking and
    completing the remaining environmental restoration activities at BRAC
    installations. The Army implemented innovative approaches to
    environmental restoration at BRAC sites in fiscal year 2001, which will
    support the early transfer of several properties. The Army will
    continue to support early property transfers in fiscal year 2002 and
    beyond and requests $149,878,000 in fiscal year 2003 to continue this
    important work. These funds allow us to properly care take these
    properties and to continue environmental and ordnance removal efforts
    that will facilitate economic revitalization and will render these
    properties safe. Our efforts will make 24,854 acres of property
    available for reuse in fiscal year 2002 and complete restoration
    activities at 7 additional locations. This budget includes the
    resources required to support projected reuse in the near term and to
    continue with current projects to protect human health and the
    environment.
        Although the extensive overseas closures do not receive the same
    level of public attention as those in the United States, they represent
    the fundamental shift from a forward-deployed force to one relying upon
    overseas presence and power projection. Without the need for a
    commission, we are reducing the number of installations by 70 percent,
    roughly equal to the troop reductions of 70 percent. Your support of
    our Efficient Basing, East, military construction project will allow us
    to continue reducing the number of installations in Europe. In Korea,
    the number of installations is dropping 20 percent. The total number of
    Army overseas sites announced for closure or partial closure since
    January 1990 is 680. Additional announcements will occur until the base
    structure matches the force identified to meet U.S. commitments.
        The significant challenges posed by the removal of unexploded
    ordnance, the remediation of groundwater, and the interface of a
    variety of regulatory authorities continue to hinder the disposal of
    property. A number of innovative approaches for environmental
    restoration were recently developed in an effort by the Army to
    expedite the transfer of property, while ensuring the protection of
    human health and the environment. Two innovative mechanisms are being
    utilized to complete environmental restoration efforts: Guaranteed/
    Fixed Price Remediation (G/FPR) Contracts and Environmental Services
    Cooperative Agreements (ESCA). A G/FPR Contract obligates BRAC funds
    necessary for regulatory closure of specified restoration activities.
    The Army retains responsibility for completion of the environmental
    restoration, overseeing the contractor and ensuring that regulatory
    closure of the property is obtained. An ESCA is a different mechanism,
    authorized under the environmental restoration program that obligates
    Army BRAC funds and apportions some amount of liability to a
    governmental entity representing the reuse interests of the particular
    BRAC installation, in exchange for specific environmental restoration
    services outlined in the ESCA.
        We remain committed to promoting economic redevelopment at our BRAC
    installations. We are supporting early reuse of properties through
    economic development conveyances as well as the early transfer of
    properties along with cooperative agreements to accelerate the
    completion of remaining environmental remediation. The Army is also
    making use of leasing options approved by Congress and awarding
    guaranteed fixed price remediation contracts to complete environmental
    cleanup to make properties available earlier. Real property assets are
    being conveyed to local communities, permitting them to quickly enter
    into business arrangements with the private sector. Local communities,
    with the Army's support and encouragement, are working to develop
    business opportunities that result in jobs and tax revenues. The
    successful conversion of former Army installations to productive use in
    the private sector benefits the Army and ultimately the local
    community.
        The BRAC process has proven to be a viable method to identify and
    dispose of excess facilities. The closing and realigning of bases saves
    money that otherwise would go to unneeded overhead and frees up
    valuable assets for productive reuse. These savings permit us to invest
    properly in the forces and bases we keep to ensure their continued
    effectiveness. We request your support by providing the necessary BRAC
    funding to continue environmental restoration and property management
    in fiscal year 2003.

                       THE ARMY ENVIRONMENTAL COMMITMENT

        The Army's Environmental Program budget request for fiscal year
    2003 totals $1,581,085,000 for its Compliance, Restoration,
    Conservation, Pollution Prevention, and Environmental Quality
    Technology Programs. This figure includes $146,156,000, reflecting the
    environmental portion of the total BRAC budget request. In addition,
    this figure reflects the Office of the Secretary of Defense budget
    request of $212,102,000 for the DOD Formerly Used Defense Site (FUDS)
    program for which the Army is the DOD Executive Agent.
        The Army Environmental Program supports readiness and improves the
    quality of life for our soldiers and their families. It fulfills the
    public trust to manage Army lands by protecting natural and cultural
    resources, in accordance with Federal, State, and local laws. The Army
    is fully committed to complying with laws and regulations, conserving
    natural and cultural resources, and cleaning up active, BRAC, and FUDS
    sites. We are continuing to integrate pollution prevention practices
    into all that we do, and we have expanded the focus of our technology
    program to address environment, safety, and occupational health needs
    comprehensively and cost effectively. By dedicating our efforts to
    these activities, we will become increasingly successful in identifying
    efficiencies to support the Army's core business practices; developing
    creative solutions to support our environmental stewardship efforts;
    protecting the health and safety of our soldiers, civilians, and
    communities; and helping to fulfill the Army's commitment to support
    and execute the National Military Strategy.
        We are further determined to accomplish our environmental program
    tasks with effectiveness and resource efficiency. Restoration and
    compliance still require the majority of our budget dollars. Programs
    in conservation, pollution prevention, and innovative technology
    provide venues for primary investments to reduce future compliance and
    restoration requirements and recapture dollars for the Army's core
    missions. Overall, our fiscal year 2003 budget request provides for a
    lean, but effective, program implementation and investment in both
    corrective and preventive actions to continue eliminating past problems
    and preventing future ones.

                              RANGES AND MUNITIONS

        The Army must provide our soldiers with tough, realistic, battle-
    focused training in preparation for a wide variety of mission essential
    warfighting scenarios ranging from desert to tropical to cold region
    operations. Ensuring our soldiers have access to the most realistic
    training possible is a challenge for both our operations and
    environmental communities.
        As part of that effort, we are developing integrated sustainable
    range management strategies to cut across functional lines to support
    the Army's livefire requirements and ensure our range capability into
    the future. The Army Range Sustainment Integration Council was
    established to work across operational, environmental, and installation
    management areas to develop solutions for sustaining continued training
    and testing on Army ranges. The Army also is making prudent investments
    in environmental quality technology to improve its ability to detect,
    identify (discriminate), and respond to unexploded ordnance (UXO), and
    to reduce costs in the future.
        Our environmental programs support the Army's core training mission
    by conserving training lands, preventing pollution, complying with laws
    and regulations, partnering with local communities, and cleaning up
    contamination at Army installations.

                                   COMPLIANCE

        The Army requests $640,931,000 for the compliance program in fiscal
    year 2003. This is a $43 million increase from last year's request and
    can be attributed to increased funding for the Massachusetts Military
    Reservation response activities, and manpower for the environmental
    program. This investment makes it possible for the Army to comply with
    applicable Federal, State, and local environmental laws, regulations,
    and Executive Orders, as well as international agreements and Final
    Governing Standards overseas.
        The Army's compliance goals are to attain and sustain cost-
    effective compliance with all applicable Federal and State regulations.
    The Army's long-term compliance objectives are to: (1) integrate
    environmental compliance into all aspects of installation operations to
    support sustainment of the mission and promote the well-being of
    soldiers, family members, civilian employees, and citizens of
    neighboring communities; and (2) sustain compliance costs within fiscal
    years 2002-2007 funding levels by shifting emphasis to pollution
    prevention solutions as a means for helping to achieve compliance.
        The Army focuses on achieving environmental compliance through
    strong command emphasis and use of effective environmental management
    systems, pollution prevention, diverse training, new tools and
    technologies, audits and better metrics, new and improved processes,
    tracking development of new environmental laws, and regulations to
    ensure timely compliance, and developing strong partnerships.
        Since environmental laws and regulations are designed to protect
    human health and the environment, compliance with them is vital to
    maintaining the well-being of our soldiers, civilian personnel, their
    families, and our neighboring communities. We have steadily improved
    our environmental compliance posture over time. Although the number of
    regulatory inspections increased slightly in fiscal year 2001, the
    number of new enforcement actions the Army received decreased by 15
    percent. Following major reductions the previous 2 years, we achieved a
    further reduction of 6 percent in open Enforcement Actions (ENFs) in
    fiscal year 2001 and continue to resolve ENFs more quickly.
        A key element necessary for the Army to meet our long-term
    environmental goals and strategy is the use of an internationally
    recognized Environmental Management System (EMS), or ISO 14001. The
    Army will use ISO 14001 processes at all levels to build trust and
    better cooperation with regulators and the community. Our goal is to
    use EMS to integrate environmental considerations across Army planning
    and operations.
        Army investments in Regional Environmental Offices are paying big
    dividends through improved relations with Federal and State
    environmental regulators. This is evidenced by negotiation of effective
    air emission requirements at Fort Leonard Wood, reduced hazardous waste
    fees in New Mexico, improved communications with the United States
    Environmental Protection Agency, and numerous partnering endeavors with
    regulators and other Federal and State agencies.

                              POLLUTION PREVENTION

        Pollution Prevention (P2) supports the Army by enabling our
    compliance with current and future laws and regulations, promoting good
    environmental stewardship of the lands entrusted to the Army, and
    developing new technologies and partnerships with industry. The Army
    requests $39,676,000, which is a decrease of $6 million from last
    year's request. Nonetheless, we will continue to realize significant
    savings from our investments in pollution prevent efforts.
        One of our major challenges is compliance with existing
    environmental laws and regulations. Achieving and maintaining
    compliance through development and implementation of pollution
    prevention strategies is a good business practice and a cost-effective
    way for the Army to meet its environmental goals.
        The Army is continuing with its efforts to fundamentally change its
    operations through incorporation of a centralized hazardous materials
    management program, which is designed to reduce or eliminate processes
    and activities that generate wastes or emissions. The Army is a leader
    in the reduction of chemicals in the Toxic Release Inventory (TRI). In
    1994, the Army reported a total of 2.4 million pounds of releases to
    the environment. By 1999, a 71 percent reduction of baseline releases
    was achieved. Today, the total releases for all installations combined
    is now less than the emissions of just one Army industrial facility in
    1994.
        Solid Waste Minimization efforts reduce costs while promoting
    recycling efforts. The goals for the solid waste management program are
    to minimize the generation of solid wastes, develop cost-effective
    waste management practices, protect public health and the environment,
    and recycle to conserve natural resources. The Army currently reuses
    and recycles 21 percent of all solid waste generated. Our recycling
    efforts significantly extend the life of existing landfills and
    resulted in a savings of approximately $18.1 million in solid waste
    disposal costs in fiscal year 2001.
        The Army has also taken a cue from the private sector and developed
    a military version of the Sustainable Project Rating Tool (SPiRiT).
    This model is being used to evaluate our military construction projects
    in terms of their sustainability, or how well they incorporate
    ``green'' building techniques, such as recyclable building materials,
    energy efficiency, natural daylight, and compatibility with the natural
    surroundings. This initiative is a common sense design and building
    practice that is intended to reduce life cycle costs while helping the
    Department support other Federal goals.
        The Army's vision is not one of mere compliance with laws and
    regulations, but rather a vision of environmental excellence through
    pollution prevention.

                                  CONSERVATION

        The Army's Environmental Conservation program is a crucial
    component in sustaining the land used for the Nation's military
    mission, as entrusted by the American people. Environmental
    requirements are increasing at the same time the Army's use of current
    land capability is reaching capacity. Also, aging infrastructure is
    stretched beyond its life expectancy. The National Historic
    Preservation Act (NHPA), Sikes Act, and the Endangered Species Act
    (ESA) are the primary drivers for increased cultural and natural
    resources requirements on Army training lands and base areas.
        The fiscal year 2003 budget request of $93,651,000 reflects a $16
    million increase over last year's funding level. The increase will
    enable the Army to continue its good stewardship of the land by
    implementing viable management plans that outline how the Army will
    continue to protect cultural resources, manage threatened and
    endangered species, integrate environmental land management, and comply
    with applicable Federal and State natural and cultural resource laws.
    The Sikes Act Improvement Act (SAIA) further defines DOD's stewardship
    responsibilities, in the context of the military mission. In addition
    to our mission requirements, the Army must provide for the conservation
    and rehabilitation of natural and cultural resources, sustain
    multipurpose use of the resources, and grant public access to the
    extent that safety and security allow.
        The most significant statutory requirement for Army-owned historic
    properties is the National Historic Preservation Act (NHPA) and its
    implementing regulation. The current scope of Army historic building
    management and compliance requirements is enormous, and will
    substantially increase over the next 10 years. As our Cold War-era
    infrastructure reaches the 50-year mark, it triggers compliance under
    the NHPA. The Army currently has 50,557 buildings over the 50-year
    mark, 63,155 archeological sites, and 17 National Historic Landmarks,
    all subject to NHPA regulation. By 2010, nearly two-thirds of all
    buildings on Army installations in the United States (77,613 of
    129,059) will be at least 50 years old and subject to NHPA
    requirements.
        In addition to the maintenance of cultural and historic resources,
    the Army is charged with the stewardship of its training lands, natural
    resources, and endangered species that reside on Army installations.
    One of the Army's most significant natural resource challenges relates
    to the use of training land, which is vital for national defense and
    readiness, while simultaneously maintaining compliance with the
    Endangered Species Act.
        There are 170 distinct threatened and endangered species on 94 Army
    installations. The increased operational tempo of Army activities is
    placing an increasing demand on land use. Additionally, urban
    development is further isolating the natural habitats located on Army
    installations. As critical habitat is destroyed on unprotected private
    lands adjacent to Army installations, training areas and ranges provide
    the only remaining large areas of habitat in many regions.
        Integrated Natural Resource Management Plans are serving as good
    tools to help the Army avoid future problems and reduce costs of
    repairing disturbed soil, vegetation, and wildlife habitats. These
    plans not only help us manage threatened and endangered species
    habitat, but also continue the long-standing tradition of providing
    outdoor recreation opportunities for soldiers and their families.

                                  RESTORATION

        The Army's commitment to its restoration program remains strong as
    we continue to make progress toward our goals of reducing risk and
    restoring property for future generations. With our regulatory and
    community partners, we are exploring ways to improve and accelerate
    cleanup. Achieving site closure and ensuring long-term remedies are
    challenges we are prepared to face. Improved business practices,
    partnerships, and innovative technologies, have enabled us to provide
    sound stewardship of the environment and taxpayer dollars.
        The fiscal year 2003 budget request for Army Restoration is
    $395,900,000, and this funding level will meet our legal agreements and
    the Defense Planning Guidance goal of fiscal year 2014. Also reflected
    in the total Army Environmental Program budget request is $146,156,000,
    which represents the environmental portion of the total BRAC budget
    request. In addition, the Office of the Secretary of Defense has
    requested $212,102,000 for the Formerly Used Defense Sites (FUDS)
    program.
        The Army's environmental restoration program addresses active,
    BRAC, and FUDS properties that became contaminated due to past
    practices. Protection of human health and the environment is the
    primary goal for the Army's restoration programs. Another Army goal is
    to restore sites to productive use and move sites into ``response
    complete'' phases as quickly as possible. Examples of initiatives to
    meet these goals are Scranton Army Ammunition Plant, the first military
    installation to complete cleanup under the Pennsylvania-DOD Multi-Site
    Agreement, and Sudbury Training Annex, the cleanup of which has
    resulted in its deletion from EPA's National Priorities List.
        By the end of fiscal year 2001, the Army completed response at 85
    percent of active sites, 80 percent of its BRAC sites, and 57 percent
    of its FUDS sites. We continue to move forward in our goal of
    completing environmental restoration and disposal/transfer of
    activities.
        The Army is expanding its efforts to focus on completion, thereby
    freeing up much needed resources for our warfighting mission. We are
    accomplishing this through management initiatives that emphasize
    comprehensive program reviews--scrutinizing remedies, applying new
    technologies, providing additional technical expertise and training,
    and resource optimization--focusing resources on selected
    installations; and increased partnering and stakeholder outreach--
    enabling us to accelerate the cleanup by reaching agreement early in
    the process.
        The Army has several review tools that have made significant
    improvements across programs, primarily through measuring cost-
    effectiveness. Groundwater Extraction Treatment Effectiveness Reviews,
    Principles of Restoration Workshops, Focused Technical Review, and Exit
    Strategy Meetings are all designed to take a close look at a specific
    portion of the program and hold it up to intense scrutiny.
        For example, the Groundwater Extraction Treatment Effectiveness
    Review has optimized efficiencies directly through the implementation
    of the Groundwater extraction and Treatment Evaluation Review program
    since 1999. To date, this program has reviewed over 20 existing and
    proposed groundwater remedies at Army installations across the country
    and has identified approximately $45 million potential life cycle cost
    avoidances at those installations during the past year alone.
        An innovative contracting mechanism that is significantly different
    from the standard cost-plus type environmental restoration contract is
    the Guaranteed/Fixed Price Remediation (G/FPR) contract. Although it is
    currently being used only at BRAC sites, active sites, and FUDS,
    properties may also use G/FPR contracts more frequently in the near
    future. A G/FPR contract was awarded for Fort Gordon in fiscal year
    2001, and one is scheduled for award at Fort Leavenworth in fiscal year
    2002. Under a G/FPR contract, the Army maintains ownership of the site
    while the contractor performs the cleanup, negotiates with regulators,
    and guarantees regulatory closure for a fixed price. The fixed price
    element of the contract protects the Army from costly overruns
    associated with any unknown contamination found on a site and transfers
    the risk of cost overruns to the contractor. The contractor, in turn,
    obtains private insurance to protect from costs associated with the
    cleanup of previously unknown contaminants.
        The Army is currently piloting the concept of a regionalized long-
    term monitoring/long-term operation contract in EPA Region VII. The
    intent of a regionalized contract is to gain efficiencies in conducting
    similar efforts in bulk. The current pilot covers Long Term Management/
    Long Term Operation (LTM/LTO) activities at active installations, BRAC
    installations, and FUDS properties. If successful, regionalized
    contracts may be implemented in other regions and may include
    environmental compliance activities.

                        ENVIRONMENTAL QUALITY TECHNOLOGY

        The Army's Environmental Quality Technology (EQT) Fiscal Year 2003
    budget request is $52,669,000, which is an increase of $19 million over
    the fiscal year 2002 budget request. This will fund continuing Army
    research, development, and test and evaluation to address the Army's
    high priority EQT requirements, and the request supports the increased
    investment in range sustainability, reduction of ownership costs, and a
    high rate-of-return on investment of limited EQT resources.
        Illustrative of our fiscal year 2003 programs are initiatives like
    range sustainment and the identification and discrimination of UXO. The
    Army EQT training range-related programs use a holistic approach to
    resolve environmental issues that impact military readiness. The
    program addresses a comprehensive suite of historic and emerging range-
    related environment and safety issues that include UXO, impacts of
    explosives, contaminated soils and groundwater, dust control, and land
    rehabilitation. In addition, sustainability of ranges is an overarching
    concept, which incorporates appropriate sustainable design elements
    into planning, design, construction, and operation and maintenance
    functions to enhance and balance total life cycle costs affecting
    environmental, safety, and occupational health issues impacting
    soldiers, installations, and adjacent communities.
        Unexploded ordnance and munitions' constituents present a
    significant challenge to installations seeking to manage and clean up
    their test and training ranges, sites designated for BRAC, and FUDS.
    Current technologies used to identify, discriminate, and address clean
    up practices for UXO and munitions constituents are, for the most part,
    neither cost nor time efficient. Development of new technologies
    capable of detecting UXO with high detection rates and low false alarm
    rates to drastically reduce the cost of site characterization and
    cleanup are needed. Development of these technologies is among the
    highest priority for the EQT Program, and the DOD community. The Army
    has recognized the importance of this problem and has fully funded its
    UXO technology program that seeks to resolve the detection and
    discrimination problem.
        The EQT Program is an increasingly robust vehicle for
    identification of Army requirements. Because of its inherent fiscal
    accountability, the program provides senior leadership the confidence
    to champion its programs. Through this program, the Army continues to
    establish environmentally compatible installations and weapons systems
    through development and exploitation of technology, without
    compromising mission readiness or training. The Office of the Secretary
    of Defense has placed the Army EQT process in the forefront as an
    appropriate model to be used to identify, prioritize, and resolve high
    priority EQT requirements.

                            FISCAL YEAR 2003 SUMMARY

        Mr. Chairman, our fiscal year 2003 budget is a balanced program
    that permits us to execute our construction programs; provides for the
    military construction required to improve our readiness posture;
    provides for family housing leasing, operations, and maintenance of the
    non-privatized inventory; and initiates privatization at seven
    additional installations. This budget request further provides for
    protection of training lands, environmental compliance with Federal and
    State regulations, restoration of contaminated sites, and important
    technology and pollution prevention initiatives in support of Army
    infrastructure, material systems, and operations and training. This
    request is part of the total Army budget request that is strategically
    balanced to support both the readiness of the force and the well-being
    of our personnel. Our long-term strategy can only be accomplished
    through sustained, balanced funding, divestiture of excess capacity,
    and improvements in management and technology. We will continue to
    streamline, consolidate, and establish community partnerships that
    generate effective relationships and resources for infrastructure
    improvement, continuance of services, and improved quality of life for
    soldiers, their families, and the local communities of which we are a
    part.
        The fiscal year 2003 request for the active Army is for
    appropriations and authorization of appropriations of $2,882,141,000
    for military construction, Army and Army Family Housing.
        The request for appropriations and authorization of appropriations
    is $101,595,000 for military construction, Army National Guard and
    $58,779,000 for the military construction, Army Reserve.
        The request for appropriations and authorization of appropriations
    is $1,580,492,000 for the Army environmental program.
        Mr. Chairman, this concludes my statement. Thank you.

        Senator Akaka. Thank you for your statement. As I said
    earlier, your full statements will be placed in the record, and
    the chair would appreciate it if you could abbreviate your
    statements.
        Secretary Johnson.

    STATEMENT OF HON. H.T. JOHNSON, ASSISTANT SECRETARY OF THE NAVY
                    (INSTALLATIONS AND ENVIRONMENT)

        Secretary Johnson. Thank you, Mr. Chairman, distinguished
    members of the subcommittee. I am H.T. Johnson, Assistant
    Secretary of the Navy for Installations and Environment, and I
    will try to abbreviate my comments.
        We have done well in the current budget in installations.
    We have $9.3 billion associated with installations, versus $8.9
    billion last year. Overall we have increased in MILCON, as I
    will point out in a moment.
        Our Secretary and our services believe in quality of
    service, which has two components: quality of life and quality
    of performance. We have tilted our funding this year on quality
    of life for our marines, sailors, and their families. We are
    also concerned about the quality of performance and life for
    our civilians and contractor teams associated with the
    Department of the Navy.
        We have increased our housing construction and improvement
    by 15 percent. This has allowed us to build 1,147 new homes and
    renovate over 3,000 others. We have also funded a lot for
    bachelor housing. Many of you might not realize that 31,000 of
    our sailors do not have a room ashore. When their ship is in
    home port they have to sleep on the ship. We have a commitment
    to provide rooms for them. We will need your help in some of
    those areas. Since 5,000 of those sailors are in Japan, we will
    convince them to fund that part. However, we have 26,000 to
    take care of and we hope to have everybody ashore provided a
    room by 2008.
        We have also added $269 million to better sustain our
    facilities. This is 15 percent above last year's enacted level.
        Unfortunately, our military construction is down to $948
    million for the Active and Reserve Forces. This is the second
    highest. Last year was higher, about $1.1 billion, so we are
    down a little bit there. But as Mr. DuBois mentioned, BRAC was
    not even mentioned in this process to my knowledge. It
    certainly did not play a role.
        We are fully funding our environmental compliance,
    conservation, and pollution accounts. We have made great
    strides, which are explained fully in our statement for the
    record. We have cleaned up more than we had planned and we are
    ahead of schedule. The former BRAC bases were fully funded last
    year, and next year we have even increased funding by 22
    percent to $261 million.
        We are making good progress on closing out these BRAC
    bases. I have a personal interest in closing them out, not just
    cleaning them up and holding onto them, and our Secretary
    supports that very strongly.
        As Mr. DuBois mentioned, Secretary Rumsfeld reduced the
    time line to get quality housing for family members to 2007.
    The Navy meets that goal and the Marine Corps beats it by 2
    years, so we are in good shape there.
        We have been very fortunate in the housing privatization
    process. The public-private ventures or partnerships have
    worked very well. We have a total of 6,600 that have been
    completed, 1,800 under way, and another 12,000 at 7 locations
    that we are looking at.
        I believe we have great opportunity to take that same
    principle and carry it into homes for our bachelors. We have
    not always taken good care of our bachelors, and we believe
    this is a way that we can make good homes a self-sustaining
    entitlement for our families as well as our bachelors.
        It would not be proper if I did not take credit for the
    Department for the great job that our marines and sailors have
    done in our energy program. Last year there were four awards at
    the national level. We got two of the four, and that just
    speaks on the dedication our individuals have. One of those was
    in southern California, and certainly last year they had
    challenges there.
        One major challenge that we continue to face and one that
    Mr. DuBois mentioned is encroachment. We have put a lot in our
    statement about encroachment. We are taking it on as a
    Department, and more importantly, we are working to make sure
    that we can provide realistic combat training on land and in
    the air for our troops, as well as testing new equipment.
        We are getting good cooperation from other agencies. I have
    been very impressed by that.
        We never seek blanket environmental exceptions from
    military needs. From the deck plate to the training range, we
    will continue to abide by all of the National, State, and local
    environmental standards. We do want to try to work some balance
    into some of the areas that we have difficulty on regarding
    encroachment, such as the Endangered Species Act, the Migratory
    Bird Act, and the Marine Mammal Protection Act. This is a
    complex issue and we are dedicated to face it. We realize that
    as time goes on this encroachment issue will grow larger.
        We have looked at Camp Pendleton ad nauseam for the last
    few months. It separates Los Angeles and San Diego and there is
    not much on each side, so we have a great problem.
        We share your desire to earn the trust of the American
    people. I believe that DOD is a recognized leader in
    environmental stewardship. We are the ultimate defender of our
    environment as well as our Nation, and we have to find the
    right balance to prepare for that ultimate mission.
        Thank you, Mr. Chairman. I look forward to answering your
    questions.
        [The prepared statement of Secretary Johnson follows:]

                    Prepared Statement by Hon. H.T. Johnson

        Mr. Chairman and members of the subcommittee, I am H.T. Johnson,
    Assistant Secretary of the Navy (Installations and Environment). I
    appreciate the opportunity to speak to you today on the Department of
    the Navy's shore infrastructure and environmental programs.
        We are all justifiably proud of the way this Nation's military
    forces have responded to the September 11 terrorist acts in New York,
    Pennsylvania, and Washington, DC. From providing increased security for
    homeland defense at airports and port facilities against future
    potential threats, Tomahawk cruise missiles fired from ships and
    submarines, and carrier-based Navy and Marine Corps aircraft providing
    80 percent of the combat sorties over Afghanistan, sailors and marines
    have served proudly and with distinction to eliminate terrorist threats
    in what was previously considered a landlocked sanctuary. In Operation
    Enduring Freedom and the global war on terrorism, on-station Naval
    Forces were first to respond, fight, and secure U.S. interests.
        It takes highly trained and motivated individuals, using advanced
    technologies and weapon systems, to successfully pursue U.S. military
    objectives. Our bases and stations provide direct and indirect support
    to forward-deployed Naval Forces. Perhaps more importantly, such
    installations are the means by which Naval Forces are formed, trained,
    maintained, and housed. Our environmental programs help ensure our
    continued use of military training areas on land and at sea, while also
    complying with national and international environmental standards.
        The Secretary of the Navy has repeatedly said people are our most
    important asset. Military pay and benefits are obviously important. But
    members of this subcommittee know that a modern, well maintained
    infrastructure is a very strong ``people'' program; it's the pier,
    hangar, warehouse, and where sailors, marines, civilian employees, and
    contractors report to work; it's the classroom and the training range
    where they learn and hone their skills; it's the nice home in a good
    neighborhood where our military members and their families live. It's
    also the commitment to effective safety and occupational health
    programs that protects them from the daily hazards they face, whether
    on the job or off. The military mission is inherently a dangerous one.
    Whether it is training for the mission, carrying out the mission, or
    preparing the weapons and weapon systems that may be employed, we need
    to, and are, pursuing a vision of zero mishaps for the future by
    institutionalizing operational risk management, embracing best business
    practices, and adopting key safety technologies.
        I will begin by summarizing our fiscal year 2003 budget request,
    and follow with more details in each program area.

                          THE FISCAL YEAR 2003 BUDGET

    Shore Infrastructure Budget
        The Department of the Navy shore infrastructure budget includes
    these appropriations: military construction, Navy; military
    construction, Naval Reserve; family housing, Navy and Marine Corps;
    Base Realignment and Closure; and the operations and maintenance
    accounts which provide base support and sustainment, restoration, and
    modernization.

        Our fiscal year 2003 infrastructure budget request continues the
    progress we have made in last year's budget. Our budget request of $9.3
    billion represents a 4.5 percent increase over the enacted fiscal year
    2002 level of $8.9 billion. While maintaining the overall forward
    momentum, we have emphasized housing and the sustainment of our
    existing facilities, consistent with the priorities of the Secretary of
    Defense, the Secretary of the Navy, the Chief of Naval Operations, and
    the Commandant of the Marine Corps. There are notable gains in these
    areas.
        Housing is a cornerstone of our efforts. The fiscal year 2003
    family housing construction request totals $376 million, a 15 percent
    increase over the fiscal year 2002 enacted level of $328 million. This
    funding will allow us to build 1,147 new homes (all but 65 are
    replacement construction) and renovate 3,137 existing homes. Included
    in this improvement request is $33 million for privatization at Pearl
    Harbor, Hawaii. Our family housing operations and maintenance request
    totals $868 million, a 4 percent reduction below the fiscal year 2002
    enacted level. This reduction is due to a net reduction of
    approximately 5,000 government owned homes, primarily the result of
    privatization efforts.

        Our military construction request for the active component totals
    $895 million, consisting of 43 Navy and 19 Marine Corps projects. The
    facts are that there are other pressing requirements, most of which are
    associated with the conduct of the war on terrorism. After the
    September 11 attack, the Department was required to make some difficult
    choices to pursue the war on terrorism. The Secretary had to achieve
    balance across many competing needs. This military construction budget
    request is the second largest in 6 years. It is exceeded only by our
    fiscal year 2002 request, and is considerably larger than previous
    requests. We are planning to use some of the funds allocated for anti-
    terrorism/force protection (AT/FP) from the Defense Emergency Response
    Fund (DERF) toward military infrastructure. These additional funds are
    not included in any tables or other discussion in this statement.
        Nearly three-quarters of the military construction request is for
    restoration and modernization projects. Consistent with our focus on
    solving housing needs, the active military construction request
    includes a robust bachelor housing effort totaling $275 million to
    construct, improve and replace 4,360 bachelor-enlisted quarters beds.
    There is also $69 million for six Navy and two Marine Corps quality of
    life projects, including fitness centers and dining facilities. We have
    included $69 million for planning and design efforts, and raised our
    request for unspecified minor construction to $23 million under the
    expectation that further AT/FP efforts will be needed.

        Our military construction, Reserve request totals $52 million,
    about the same as the fiscal year 2002 enacted level. There are six
    Navy (including a bachelor enlisted quarters for 92 spaces) and three
    Marine Corps projects totaling $48 million, $2.5 million for planning
    and design, and $1 million for unspecified minor construction.
        Our prior Base Realignment and Closure request totals $259 million,
    a 20 percent increase over the fiscal year 2002 enacted level of $215
    million. This funding supports caretaker functions and cleanup of
    contamination at base closures under the four previous rounds (i.e.,
    BRAC 1988, BRAC 1991, BRAC 1993, and BRAC 1995). This request meets all
    current regulator and community expectations for cleanup at our BRAC
    bases. I am pleased to report we have resolved our fiscal year 2002
    shortfall as a result of the additional funds provided by Congress, the
    availability of land sale revenue, and the use of prior year BRAC funds
    which we have determined are no longer needed for their original
    intended purpose. These prior year BRAC funds are being reallocated to
    fund fiscal year 2002 BRAC cleanup needs.
        Our sustainment, restoration, and modernization (SRM) funded by
    operations and maintenance accounts request totals $2,066 million, a 15
    percent increase over the fiscal year 2002 enacted level of $1,797
    million. This $269 million increase in funding allows the Marine Corps
    to achieve 92 percent, and Navy 84 percent, of the sustainment
    requirement for the existing facilities inventory based on the current
    requirements model. This provides the highest level of sustainment
    funding achieved using this metric, considerably higher than the
    estimated 80 percent for Marine Corps in fiscal year 2002, and the
    estimated 71 percent Navy average over the 3 previous years.
    Environmental Budget
        Our environmental budget request totals $1.2 billion, the same as
    the fiscal year 2002 enacted level of $1.2 billion. Environmental
    quality is the single largest portion of the environmental budget.
    Funding for this function is contained in a number of different DON
    accounts: the active and Reserve operations and maintenance
    appropriations for Navy and Marine Corps; other procurement, Navy;
    military construction, Navy; military construction, Naval Reserve;
    research, development, test, and evaluation, Navy; and Navy working
    capital fund. This level of funding supports the basic environmental
    compliance, conservation, and pollution prevention functions at our
    bases, e.g., personnel salaries, environmental permits and fees,
    environmental sampling and laboratory analysis, and hazardous waste
    disposal costs. It also funds all known one-time compliance projects to
    meet fiscal year 2003 Federal, State, and local environmental standards
    such as the Clean Water Act, Clean Air Act, Safe Drinking Water Act,
    Resource Conservation and Recovery Act, and Act to Prevent Pollution
    from Ships.

        The environmental restoration program, also called the cleanup
    program, is designed to clean up contamination at current active Navy
    and Marine Corps bases. Cleanup funding at active bases is on par with
    last year, and provides sufficient funds to meet all legal agreements
    now in place with EPA and the States while continuing consistent
    progress to program completion in 2014.
        The budget request continues a large environmental research and
    development effort, primarily aimed at resolving current and future
    marine environmental issues for our ships. For example, the budget
    request includes $10 million for marine mammal research to better
    understand behavior, habitat, and sensitivity to sound generated in the
    water.
        The Navy is approaching the end of a 10-year effort to clear
    ordnance at Kaho'olawe, a small, uninhabited island in Hawaii that
    served as a naval bombing range for over 50 years. The fiscal year 2003
    budget request of $25 million is the same as the fiscal year 2002
    budget request. Although the clearance effort will not achieve full
    clearance of unexploded ordnance, it has already met the goals of
    Public Law 103-139 to allow public access for cultural, religious, and
    educational purposes. In accordance with this statute, the Navy will
    conclude its clearance efforts, and turn over access control of
    Kaho'olawe to the State of Hawaii in November 2003. We are grateful for
    the close cooperation we have received from the Kaho'olawe Island
    Reserve Commission on behalf of the State of Hawaii.
        I would now like to address specific program areas in more detail:

                                    HOUSING

        We have two overarching housing principles:

             Our sailors and marines, and their families, are
            entitled to quality homes; and
             Housing that we provide, either directly through
            ownership or indirectly through privatization, must be self-
            sustaining over the long term. ``Self-sustaining'' means that
            we must ensure that the resources are there to operate,
            maintain, and recapitalize the home throughout its life.
    Family Housing
        Our family housing strategy consists of a prioritized triad:

        1. Reliance on the Private Sector. We rely first on the local
    community to provide housing for our sailors, marines, and their
    families. Three out of four Navy and Marine Corps families receive a
    Basic Allowance for Housing (BAH) and own or rent homes in the
    community. Our bases have housing referral offices to help newly
    arriving families find suitable homes in the community.
        2. Private Financing through Public/Private Ventures (PPVs). With
    the strong support from this subcommittee and others, we have
    successfully used statutory PPV authorities enacted in 1996 to partner
    with the private sector and meet our housing needs, in part, through
    the use of private sector capital. These authorities, which I like to
    think of in terms of public/private partnerships, allow us to leverage
    our own resources and provide better housing faster to our families. We
    are aggressively seeking additional opportunities to meet our housing
    needs through the use of PPVs.
        3. Military Construction. Military construction will continue to be
    used where PPV authorities don't apply (such as overseas) or where they
    don't make financial sense for the Department.

        Some years ago, the Secretary of Defense established a goal to
    eliminate inadequate military family housing units by fiscal year 2010.
    Secretary Rumsfeld recently accelerated that goal by 3 years, to fiscal
    year 2007. Through a combination of increased funding and increased use
    of PPV authorities, I am pleased to say that the Navy and Marine Corps
    have stepped up to the challenge: the Navy will meet the Office of the
    Secretary of Defense (OSD) goal and eliminate their inadequate family
    housing by fiscal year 2007. The Marine Corps will exceed the goal and
    eliminate their inadequate housing by fiscal year 2005.
    Bachelor Housing
        Our budget request continues the emphasis on improving living
    conditions for our unaccompanied sailors and marines. While we are
    nearing the achievement of our goal for improving family housing, our
    track record in addressing the housing needs of our single members has
    been uneven. One of our top priorities is to focus attention and
    resources on improving bachelor housing. There are three challenges:

        1. Provide Homes Ashore for our Shipboard Sailors. There are
    approximately 31,000 sailors worldwide who are required to live aboard
    ship even while in homeport. This situation is unacceptable. The recent
    change in law allowing E4s to receive BAH is a step in the right
    direction. Under current levels of funding, the Navy estimates that it
    will be able to achieve its ``homeport ashore'' initiative by fiscal
    year 2008. Our fiscal year 2003 budget includes two ``homeport ashore''
    projects that will provide homes ashore to 764 shipboard sailors at
    Norfolk, VA and Bremerton, WA. Through continued emphasis on military
    construction and the use of private financing authorities for bachelor
    housing, I strongly believe we can, and must, do even better.

        2. Ensure our Barracks Meet Today's Standards for Privacy. We are
    continuing our efforts to construct new and modernize existing barracks
    to provide increased privacy to our single sailors and marines. The
    Navy applies the ``1+1'' standard for permanent party barracks. Under
    this standard, each single junior sailor has his or her own sleeping
    area and shares a bathroom and common area with another member. To
    promote unit cohesion and team building, the Marine Corps was granted a
    waiver to adopt a ``2+0'' configuration where two junior marines share
    a room with a bath. Both configurations allow for more private quarters
    for our senior sailors and marines. Our fiscal year 2003 request
    reflects a recent change in OSD criteria that gives the services
    flexibility to adjust the proportion of living area and common space
    within an overall limitation of 66 square meters (710 square feet) per
    module. The Navy will achieve these barracks construction standards by
    fiscal year 2013; the Marine Corps by fiscal year 2010.
        3. Eliminate gang heads. The Navy and Marine Corps remain on track
    to eliminate the inadequate barracks with gang heads for permanent
    party personnel.\1\ The Navy will achieve this goal by fiscal year
    2008; the Marines by fiscal year 2005.
    ---------------------------------------------------------------------------
        \1\ Gang heads remain acceptable for recruits and trainees.

    Family Housing Privatization
        We are using a two-step approach for PPV. The first step (Request
    for Qualifications (RFQ) phase) allows a list of proposers to be
    narrowed to those who are judged to be highly qualified on the basis of
    their experience, financial capabilities, and vision for meeting our
    needs. Those proposers judged to be ``highly qualified'' (typically
    four to six) are then invited to submit technical and financial
    proposals to achieve our project objectives. We then select a preferred
    developer with whom we enter into exclusive negotiations. In all PPV
    projects, we have established the following objectives:

             Self-sustaining projects that provide for necessary
            recapitalization over the long-term without additional
            infusions of cash;
             A legally recognized voice in key decisions made over
            the life of the agreement;
             Flexibility to accommodate unforeseen changes over the
            life of the agreement; and
             Protection of government interests and minimization of
            government exposure in case of default, poor performance, or
            non-performance.

        We have now awarded eight PPV projects totaling 6,583 homes.
    Through the use of these authorities we have leveraged $135 million in
    DON funds with $478 million in private sector capital for a combined
    investment of $613 million in homes for our sailors, marines, and their
    families. We have effectively expanded our buying power by stimulating
    over $4.50 of construction for each $1.00 we have contributed. We
    currently have two additional projects in procurement (not yet awarded)
    and another eight projects in planning. All told, the projects, either
    in procurement or planning, total 13,792 homes.

    Private Financing Alternatives for Bachelor Housing
        I believe that there are real opportunities for applying PPV
    authorities to our barracks needs. We held an industry forum last
    November with developers, lenders, and property managers. We learned
    that there is a potential to use private sector financing to improve
    bachelor housing. We are developing three bachelor housing pilot
    projects--Hampton Roads, VA; Camp Pendleton, CA (Del Mar); and
    Quantico, VA (Basic School). We look forward to bringing these
    proposals to the subcommittee in the near future.
    Housing Issues
        We appreciate Congress extending the military housing public/
    private venture authorities to 2012. DOD is considering additional
    legislative changes to improve our efforts in family housing and remove
    obstacles for the application of these authorities to bachelor housing,
    such as combining family and bachelor housing privatization accounts
    into a single fund to facilitate joint projects.

                                   FACILITIES

    Sustainment, Restoration, and Modernization
        With this budget, the DON is implementing the new DOD methodology
    for facilities maintenance and repair. Sustainment is the amount of
    funding required for scheduled maintenance and facility component
    repairs over the expected service life of the facility. It does not
    improve the condition or readiness of the facility. It is calculated
    using the DOD Facilities Sustainment Model (FSM), which considers
    facilities quantity data (most often square feet), and unit cost
    factors (most often dollars per square foot) derived from private
    industry. The calculated sustainment requirement is unique to the DON
    infrastructure inventory and adds consistency and audit ability in
    determining our requirement. FSM projects inventory gains (new
    construction) and losses (demolition, privatization, excess facilities)
    to arrive at a total sustainment requirement. The sustainment metric is
    the percentage funded of the FSM generated requirement. While competing
    budget pressures precluded us from doing better, this budget request
    meets more than 85 percent of the Department of Navy FSM calculated
    requirement--much better than in previous years.

        Restoration and modernization (R&M) is the portion of SRM that goes
    beyond sustainment to improve the condition and readiness of the
    facility, using operations and maintenance as well as military
    construction funds. The operations and maintenance funds help to
    correct poorly rated facilities and to recapitalize the inventory. R&M
    requirements are based on an investment level to achieve a DOD average
    67 year recapitalization rate, with all facilities satisfactorily
    sustained. Over the FYDP, R&M (O&M and MILCON) is funded to eliminate
    facility deficiencies by 2013. The fiscal year 2003 recapitalization
    rate is 122 years and the FYDP (03-07) average is 83 years.
    Anti-terrorism/Force Protection
        Every installation has increased its security posture since the
    attacks of September 11. Additional security personnel, technology
    (security systems, detection devices), security fencing, barriers,
    security boats, and training are being used to enhance our AT/FP
    posture. The SRM budget includes $147 million in AT/FP projects. These
    measures include shatter resistant windows, structural reinforcement,
    and building hardening.
        The military construction budget request has incorporated AT/FP
    measures within the scope of each project, where appropriate. These
    measures include standoff distances, shatter resistant windows,
    structural reinforcement and building hardening. These features account
    for $17.5 million within the projects requested in the fiscal year 2003
    MILCON program.
        There are seven military construction projects totaling $107
    million that support specific AT/FP enhancements and/or improvements.
    These projects were identified after the September 11 attacks:

             Advanced Explosive Ordnance Disposal Training
            Facility, Eglin AFB, FL--$6.4 million;
             Shoreline Security Fencing, Naval Station, Norfolk,
            VA--$2.0 million;
             Installation Services Support Center, Naval Support
            Activity, Bahrain--$26.0 million;
             Parking Garage and Perimeter Security Upgrade, Naval
            Air Station, Sigonella, Italy--$19.6 million;
             AT/FP Improvements, Naval Shipyard, Kittery, ME--$11.6
            million;
             AT/FP Improvements, Naval Shipyard, Portsmouth, VA--
            $19.7 million; and
             AT/FP Improvements, Naval Shipyard, Puget Sound,
            Bremerton, WA--$21.7 million.
    Building Demolition
        Our centralized demolition program remains a success story. Defense
    Reform Initiative Directive 36 directed the Navy and Marine Corps to
    dispose of excess facilities over the period of fiscal year 1998
    through fiscal year 2002. Navy will exceed its goal of 9.1 million
    square feet (MSF) in fiscal year 2002. The Marine Corps met its goal of
    2.1 MSF in fiscal year 2000. Both Services will continue the demolition
    program. Our fiscal year 2003 budget request continues this effort,
    with Navy planning to spend $42 million on 50 projects to demolish 2.0
    MSF and Marine Corps planning to spend $5 million on 15 projects to
    demolish 0.5 MSF. The Navy has expanded the use of the central account
    funds to allow limited relocation and repair costs to consolidate
    functions before demolishing the vacated building. These actions will
    eliminate obsolete excess facilities, and further reduce SRM needs.
    Energy and Utilities Privatization
        To comply with Executive Order 13123 goals, Federal agencies must
    reduce energy consumption 30 percent by fiscal year 2005 and 35 percent
    by fiscal year 2010, using fiscal year 1985 as the baseline. I am
    pleased to report that we have reduced consumption by nearly 25 percent
    through fiscal year 2001, exceeding our target of 24 percent. To meet
    these goals, we are implementing energy efficient technologies,
    conducting energy awareness programs, and using private sector
    expertise. I am delighted that the DON energy program received two of
    the four government wide Presidential Energy Awards presented by the
    Vice President at a ceremony on October 18, 2001.
        We are also expanding the use of geothermal energy production at
    Naval Air Warfare Center China Lake, CA and Naval Air Station Fallon,
    NV. This gives us a cost efficient method to use private sector
    financing to generate additional energy in the western U.S. while using
    our land for military training needs.
        Defense Reform Initiative Directive 49 directed the services to
    privatize their natural gas, water, wastewater, and electrical systems
    except where uneconomical or where precluded by unique security
    reasons. Privatization is expected to reduce total ownership costs
    while upgrading the reliability of our utility systems. The DON is
    continuing efforts to privatize, where economically beneficial, 704
    systems at 122 activities worldwide by fiscal year 2005. Proposals are
    now being evaluated to privatize utility systems at the Marine Corps
    base at Twentynine Palms, CA, and Navy and Marine Corps installations
    in the Great Lakes and Washington, DC regions.
    Facilities Issues
        The DOD is considering a number of facilities related proposals,
    including:

             Reduction in long-term facility maintenance costs.
            Expands the demonstration program under Section 2814 of the
            National Defense Authorization Act for Fiscal Year 2002, now
            limited to the Army, to allow a single contractor to design,
            build, operate, and maintain facilities funded with military
            construction funds. It would allow additional demonstration
            projects that seek to reduce life cycle costs for facilities
            within the DOD.
             Conveyance of surplus real property for natural
            resource conservation purposes. Allows the transfer of
            environmentally sensitive property with endangered species
            habitat to a non-governmental organization. This type of
            property can now only be transferred to governmental entities.
            This proposal would expand the field of potential recipients,
            expanding the opportunity to dispose of excess property that
            has limited commercial development potential.
             Amend 10 U.S.C. 2810 Construction Projects for
            Environmental Response Actions. Based on Congress' new
            definition of repair, the Services are not able to continue to
            define environmental restoration of soil as repair. The
            unintended consequence of this redefinition is that these
            cleanups would have to be classified as MILCON, with all of the
            necessary approvals inherent with that funding source. This
            proposal would return the status of environmental restoration
            projects as repair and allow these cleanup projects to be
            funded from the environmental restoration accounts in the DOD
            Appropriations Bill. Notification would be submitted for
            projects estimated over $10 million.

                       PRIOR BASE REALIGNMENT AND CLOSURE

    Status
        We are now in the home stretch to complete environmental cleanup
    and property disposal from the four prior rounds of BRAC, 1988 under
    Public Law 100-526 and 1991, 1993, and 1995 under Public Law 101-510.
    We were authorized to implement a total of 178 actions consisting of 46
    major closures, 89 minor closures, and 43 realignments. We have
    completed closure and realignment of all bases except one move from
    leased space to government owned space.

        Our focus is now on cleanup and property disposals for 595 parcels
    at 90 installations. I am pleased to report that to date we have
    transferred 354 parcels comprising over 69,000 acres. Conveyance
    actions are complete at 60 of the 90 installations. Still to go are 241
    parcels at 30 installations. Completing environmental cleanup is
    generally the critical path to conveyance. The fiscal year 2003 budget
    is sufficient to meet all regulator requirements and commitments to
    local redevelopment authorities.
    A Look Ahead
        We have ambitious plans for property disposals during the remainder
    of fiscal year 2002 and into fiscal year 2003. At Mare Island we have
    signed early transfer agreements that will convey approximately 3,670
    acres to the city of Vallejo and the State of California for economic
    use and development. At Hunters Point, the Secretary of the Navy signed
    an agreement with the city of San Francisco to work with a public/
    private partnership to accelerate the conveyance of this property. At
    the former Oakland Naval Hospital, we have initiated action with the
    General Services Administration to sell the 174-acre property by public
    sale. We are nearing conveyance of the final parcels at each of the
    following locations: Annapolis, Long Beach, Louisville, Naval
    Activities Guam, New London, and Orlando, with another seven locations
    working toward planned transfer in fiscal year 2003.
        I will now discuss our environmental efforts, particularly with
    respect to mounting concerns about our ability to sustain military
    readiness.

                             ENVIRONMENTAL PROGRAMS

    Sustained Readiness
        Military readiness is essential to the security of the United
    States, to the protection of the lives and well-being of our citizens,
    and to the preservation of our freedoms, economic prosperity, and our
    national heritage. A well-trained military is a principal component of
    military readiness. To be well-trained and prepared, sailors and
    marines must train in the same manner as they fight. Military lands and
    training ranges (including land, sea and air training and operating
    areas) exist to ensure military preparedness by providing realistic
    training opportunities, including the use of live ordnance.
        Having experienced combat first-hand, I can assure you that there
    is no substitute for training. In a world where advanced weapons and
    sensors are available for the right price, no amount of technology,
    hardware, personnel, or leadership can substitute for realistic
    training. When ground forces ashore call for gunfire or close air
    support in future combat, we cannot afford to have the ship or aircraft
    crew learn on the job.
        Population growth, economic development, increased land use,
    expansion of conservation and recreational areas, and urban and
    suburban sprawl, along with State and Federal environmental laws and
    regulations, have significantly restricted the military's access to and
    use of military lands, training ranges, and at-sea operating areas
    (OPAREAS), and limited its ability to engage in live-fire training.
    This phenomenon--sometimes referred to as ``encroachment''--has
    markedly restricted the military's ability to train realistically and,
    unless checked, promises to produce further restrictions in the future.
        Access restrictions have already negatively affected military
    readiness and will continue to erode it unless this trend is reversed.
    In some cases, the application of certain environmental laws and
    regulations to military lands and training ranges challenges their
    primary mission as locations for military training.

        Our goal is to enhance readiness, not to roll back environmental
    protection. We are not looking for an exemption for everything the
    military does, but a balanced approach between environmental concerns
    and unique military readiness needs.
        Among the elements of our national heritage protected by the shield
    of military readiness is our Nation's environment--our land, air, and
    water as well as the fish, wildlife, and plant species that inhabit
    them. In addition to defending against foreign threats, the military
    acts as trustee, helping to protect the environment by its prudent and
    conscientious management of natural resources. Largely as a result of
    this stewardship, military lands present favorable habitats for plants
    and wildlife, including protected species.
        The DOD is a recognized leader in environmental stewardship and
    will continue to protect the Nation and the environment. We must have
    the flexibility to use military lands and OPAREAS for national defense
    as the first priority. There are numerous examples of environmental
    considerations that limit training opportunities, and increase the
    challenge of sustaining readiness.
        The designation of critical habitat under the Endangered Species
    Act (ESA) can undermine the purposes for which military lands have been
    set aside. Under the ESA, if an agency action may affect critical
    habitat, that agency is required to ensure that its action does not
    destroy or adversely modify designated habitat. We believe that
    designation of critical habitat on lands under military control will
    adversely affect military readiness. The courts have held that critical
    habitat is intended for species recovery. Once critical habitat is
    designated, such lands must be used first for species recovery. Hence,
    the designation of critical habitat is a bar to any land use that
    diminishes the value of that land for species recovery.
        The DOD is already obligated under the Sikes Act to develop
    Integrated Natural Resource Management Plans (INRMP) for lands under
    military control. These INRMPs address management of natural resources
    in the context of the military mission for which the lands were placed
    under the control of the military services. Because INRMPs are prepared
    in cooperation with the Fish and Wildlife Service (FWS) and State
    agencies, these agencies recommend ways for DOD installations to better
    provide for species conservation and recovery. The Sikes Act, however,
    preserves the principal purpose of providing the military with lands on
    which to test, train, and support military readiness.
        Nowhere is the potential impact of critical habitat designation on
    the use of military lands for military training more apparent than in
    Southern California, especially with respect to Marine Corps bases in
    that locale. In February and March 2000, FWS proposed designation of
    16,000 acres (more than half) of Marine Corps Air Station, Miramar for
    critical habitat. Areas proposed for designation included runways and
    other structures, although the runways and facilities themselves were
    not included. FWS also proposed critical habitat designation on about
    57 percent of Marine Corps Base, Camp Pendleton, an installation of
    126,000-acres. At Miramar, the Marines were able to convince FWS that
    the INRMP provided sufficient species protections therefore no formal
    critical habitat designation was made. At Camp Pendleton, FWS
    determined that the harm to military readiness was greater than the
    value of critical habitat designation, and scaled back its designation.
    Non-Federal entities are unhappy with these results, however, and are
    challenging these decisions in court.
        If the challenges are successful, critical habitat designation at
    Miramar could impede the construction and use of ground support
    facilities, such as a rifle range. The Marine Corps will also have to
    consult with FWS for the use of existing runways and other aviation
    support facilities. At Camp Pendleton, a loss could require the Marine
    Corps to consult on training on 57 percent of the base. The Corps is
    already modifying training on that portion of the base currently
    designated as critical habitat: Marine Expeditionary Unit (MEU)
    amphibious landing exercises are seasonally restricted to only one
    beach at Camp Pendleton. In March 2000, the 13th MEU was restricted to
    500 yards out of 17 miles of beach because of a number of encroachment
    restrictions, including endangered species. Instead of a realistic
    night time amphibious landing, units coming ashore on Landing Craft Air
    Cushion (LCACs) vehicles were off-loaded at the LCAC facility before
    moving inland to continue the exercise. They did not go through the
    full kinds of training required to prepare to take a hostile beach.
    This was a very serious degradation of training.
        The Navy has worked hard to ensure that its training needs and
    those of endangered species such as the Western Snowy Plover can co-
    exist. Naval Air Base (NAB) Coronado has been home to Navy frogmen and
    SEALs since their inception in World War II. All of the basic skills
    from diving to hydrographic reconnaissance have been taught on the
    beaches and in the bays surrounding the base. Since 1996, the Navy has
    spent about $675,000 per year on conservation and management programs
    for the birds. That effort has successfully increased nesting by almost
    300 percent. Nonetheless, the Navy's stewardship efforts resulted in
    the loss of training area. Due to encroachment, including the increase
    in the Western Snowy Plover and the Least Turn population, and the
    designation of critical habitat for the Pacific population of the
    Western Snowy Plover by FWS in December 1999, NAB Coronado has lost the
    use of over 80 percent of its training beaches. The Navy has had to
    substantially alter training activities or to conduct them elsewhere,
    both of which disrupt training cycles, increase costs and the already
    considerable time sailors must spend away from their families before
    leaving for 6-month deployments.
        Rather than allowing successful stewardship to evolve into an
    infringement on training, there must be incentives that encourage
    continued conservation efforts. The Navy implemented a protection
    program for the endangered California Least Tern and Western Snowy
    Plover at Naval Amphibious Base Coronado, CA. Nests were relocated or
    marked, and areas with marked nests were avoided during training
    exercises. Over the period of 1993 through 2001, the number of Least
    Tern nests increased 600 percent and the number of Snowy Plover
    increased 300 percent. However, the FWS has allowed the Navy to take 10
    Least Tern nests and one Snowy Plover nest annually. The Navy has had
    to move, scale back or drop its amphibious training exercises because
    of the potential to exceed the number of takes allowed. The Navy has
    requested an increase in the number of takes. This would allow more
    effective training, and provide an incentive to continue a program that
    is manpower intensive and costly.
        Litigation under the Migratory Bird Treaty Act (MBTA) may result in
    restrictions on training at ranges and operating areas. MBTA was
    enacted more than 80 years ago to regulate commercial duck hunting and
    conservation of migratory birds. Since a U.S. Circuit Court of Appeals
    ruling, the MBTA has been viewed by some as a vehicle for regulating a
    wide range of activities that affect nearly every species of bird.
        Based on the Circuit Court decision, third parties have filed suit
    challenging the unintentional taking of migratory birds incidental to
    military training. The Navy has been sued over its use of a small,
    uninhabited island in the Western Pacific as a target range because the
    Navy does not have a permit to take migratory birds. We are concerned
    by the impact of the MBTA on training ranges and activities and are
    working within the administration to address this issue.
        The basic competition between military and conservation interests
    in the use of on-base resources highlights one area where we have a
    strong common interest: preservation and enhancement of undeveloped
    off-base land, water, and air resources. Both military and conservation
    interests have a major stake in preserving and enhancing the remaining
    open space surrounding military installations. Recognition of this
    common interest has led to discussions with State and local
    governments, as well as non-governmental organizations to develop a
    partnership approach to addressing our mutual concerns.

        Access for military purposes is an issue at sea as well as ashore.
    The Marine Mammal Protection Act's definition of ``harassment'' has
    been a source of confusion since the definition was included in 1994
    amendments to the statute. The statute defines ``harassment'' in terms
    of ``annoyance'' or the ``potential to disturb,'' vague standards that
    are difficult to interpret. The definition of harassment and its
    application are pivotal because an authorization to harass marine
    mammals must be obtained in advance of any activity that would be
    deemed to constitute harassment. The Navy has had to alter or halt its
    training and research efforts to eliminate even the possibility that a
    training event will disturb a marine mammal to avoid the delays and
    uncertainty with getting a permit under this ambiguous standard. A
    clearer definition of harassment is needed. We are working with other
    interested Departments on a legislative proposal to clarify the
    definition of harassment. The recent recommendations of the National
    Research Council that focus harassment on significant disruptions to
    behaviors critical to survival and reproduction may be a worthy
    approach for this administration to consider. Military training plans
    could then incorporate these standards in a consistent, balanced
    manner.
        The DOD is working within the administration to identify ways to
    sustain the readiness of our forces. We must ensure the appropriate
    balance between military readiness and the environment, clarifying
    ambiguous statutory and regulatory requirements, finding more flexible
    ways to protect the environment, and working with conservation
    organizations to protect the environment within as well as outside the
    fence of our bases.
        Section 1041 of the National Defense Authorization Act for Fiscal
    Year 2002 directs the Secretary of Defense to prepare a report to the
    President and Congress on the need for a ``Defense Impact Review
    Process.'' This process would, if enacted, provide the DOD the
    opportunity to review the proposed actions of other Federal agencies in
    order to identify those actions which may have an adverse impact on
    national defense. We believe that just as the DOD must consider
    resource protection and conservation when formulating programs or
    actions, so should other Federal agencies consider national defense
    considerations. We are working with the Office of the Secretary of
    Defense and the other services to prepare the required report.
    Munitions/UXO
        The Department has an aggressive program to manage munitions and
    unexploded ordnance (UXO) at operational, closed, and transferred
    ranges. At operational ranges, it is vital that we train our people in
    the same manner and under the same conditions that they would fight. We
    also need to ensure that range operations do not present an
    unacceptable risk to human health or the environment. We plan to
    conduct comprehensive environmental assessments at each of our
    operational ranges to ensure there are no environmental threats. To
    ensure long-term viability of our ranges, Sustainable Range Management
    Plans will be developed for all Navy and Marine Corps ranges. For
    closed ranges and properties to be transferred from DOD ownership, we
    plan to use DOD explosive safety authorities and the procedures
    prescribed under the Comprehensive Environmental Response,
    Compensation, and Liability Act (CERCLA) to take appropriate actions
    (e.g., munitions removal, limiting access) and to cleanup munitions
    constituents. As part of the DOD Munitions Response Committee, we are
    discussing the special nature of clearance and cleanup for munitions
    with State and Federal regulators. The subcommittee has set a goal to
    develop a collaborative decision-making process for clearance and
    cleanup of properties with munitions and munitions related
    contaminants. One of the models for this approach is the successful
    munitions clearance and cleanup at Adak, AK. The Navy, EPA Region IX,
    and the State of Alaska worked together to reach agreement on a risk-
    based process for investigation, clearance, and remediation of the
    Navy's property at Adak.
    Installation Restoration
        The installation restoration program, also called the cleanup
    program, is focused on the investigation and cleanup of contamination
    at sites located on active Navy and Marine Corps installations. There
    are 3,656 sites on 200 installations--129 of these installations have
    on-going cleanup activities while 71 installations are completed.
        We have established the following operating principles for the
    program:

             We will evaluate, and ultimately close out all sites
            in the program;
             We will use relative risk evaluations and risk
            management to determine priorities for action within available
            funding;
             We will maintain a stable funding profile at a level
            that protects human health and the environment, and makes
            progress toward fulfilling our legal obligation to address and
            reach decisions at all sites;
             We will plan, prioritize, and execute the program in
            open dialogue with regulators and public stakeholders, and
            ensure meaningful involvement of affected communities; and
             We will expedite cleanups by using formal partnering
            and the flexibilities and lead agency responsibilities
            described in Executive Order 12580 and the National Contingency
            Plan for Oil and Hazardous Substances Spills.

        By the end of fiscal year 2001, we had ``remedies in place'' or
    ``responses completed'' at 61 percent of the active Navy and Marine
    Corps sites. I am pleased to report that fiscal year 2001 was a
    particularly successful year for us: we improved our process and
    cleaned twice as many sites while doubling the number of installations
    where all cleanup actions have been completed, compared to what we had
    planned to accomplish. Contributing to this success were major
    improvements in our site management database. More importantly, we have
    developed formal partnering arrangements with State and Federal
    regulators. This has led to a more streamlined process with fewer
    disagreements, which should hold us in good stead for the future.
        In 1995, we created a Cost to Complete Index. This index tracks the
    total remaining cost to complete the program, the cumulative amount
    invested and the cost avoidance achieved through the implementation of
    various management initiatives and the application of new technologies.
    The cost to complete for the program has been reduced from $5.23
    billion in fiscal year 1995 to $3.31 at the end of fiscal year 2001,
    including $570 million in cost avoidance. One of the initiatives that
    have paid dividends is the Navy's Alternative Restoration Technology
    Team, which seeks out new technologies and helps our field divisions
    apply them to site cleanups.
        The Navy is working with State and EPA partners on an innovative
    method to ensure long-term management for land use controls. Land use
    controls are used to protect public health where residual contamination
    remains. The Navy has participated in a pilot project where land use
    controls would be managed by a non-profit, private trust specifically
    established for this purpose. There are significant advantages for all
    parties. Transferring responsibility for land use controls would allow
    the DOD to essentially privatize this function, and allow economies of
    scale since all land use controls in a State or region, from both
    public and private parties, could be managed together. It provides a
    degree of assurance to regulators and the public that the controls will
    be monitored and enforced.
    Shipboard Environmental Program
        The Navy is a world recognized leader in environmental activities,
    and has invested about $775 million in the last 5 years to identify,
    develop, test, buy, and install environmentally compliant equipment on
    its ships. The goal is to ensure that Navy ships are environmentally
    benign. The Navy will complete the installation of pulpers and
    shredders to process solid waste on all surface ships this calendar
    year.
        The Clean Air Act Amendments of 1990 prohibited the commercial
    production of chlorofluorocarbons (CFCs) that are used by the Navy as
    shipboard refrigerants and the commercial production of Halons that are
    used by the Navy as firefighting agents. The Navy has developed
    alternative shipboard systems that do not rely on the CFCs and Halons
    whose production has stopped.\2\ The Navy is replacing CFC-12 in its
    shipboard cooling systems with ozone-friendly hydrofluorocarbon (HFC)-
    134a. The Navy will convert over 900 CFC-12 cooling systems to HFC-134a
    by the year 2005. At the end of fiscal year 2001, 261 of 316 total air
    conditioning plants have been converted and 451 of 655 refrigeration
    plants have been converted. These conversions make 192 ships CFC-12-
    free! We have sufficient funding to convert an additional 25 ships in
    fiscal year 2002. Our fiscal year 2003 budget request would convert an
    additional 29 ships.
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        \2\ The Defense Logistics Agency maintains a reserve supply for
    mission critical needs.
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        The fleet-wide conversion of shipboard CFC-114 air-conditioning
    plants to use ozone-friendly HFC-236fa is underway. The converted
    cooling systems will incorporate redesigned compressors and
    microprocessor-based monitoring and control that will enhance
    troubleshooting and reduce the workload on sailors assigned to operate
    and maintain the plants. Testing indicates that these converted plants
    perform better and are quieter. As of the end of January 2002, a total
    of 35 plants have been converted aboard 9 ships. Under the current
    conversion schedule all 103 surface ships in the program would be
    completed by 2013. An additional 10 ships will be converted in fiscal
    year 2002. Our fiscal year 2003 budget request converts 13 more ships.
    Under the current conversion schedule, all 103 surface ships in the
    program would be completed by 2013.
        Newly built ships such as the Navy's newest destroyers (Flight IIA
    of Arleigh Burke (DDG 51) class), the new San Antonio (LPD 17)
    amphibious class, the CVN 76 aircraft carrier, and all future
    shipbuilding programs will incorporate Navy designed and tested
    advanced shipboard air-conditioning and refrigeration plants that also
    use HFC-134a.
        Approximately 70 percent of hazardous waste handled by Navy
    homeports originates from used or excess hazardous materials offloaded
    from ships. The Navy is buying commercial off-the-shelf pollution
    prevention equipment to reduce the shipboard use of hazardous
    materials. The goal is to reduce the need for hazardous material on
    ships by up to 35 percent. Savings will accrue not only to reduce
    environmental costs for hazardous waste disposal, but also areas
    outside the environmental budget, e.g., material procurement costs,
    labor, and safety. At the end of fiscal year 2001, 32 ships have been
    outfitted with pollution prevention equipment. Plans are to convert 40
    more in fiscal year 2002, and the fiscal year 2003 budget request
    provides sufficient funds to convert 36 more. The Navy expects to
    complete this effort by the end of fiscal year 2005.
        The Navy has been working with the U.S. Environmental Protection
    Agency to establish uniform national discharge standards not currently
    regulated for naval vessels. These standards will establish standards
    for armed forces vessel discharges that are not currently regulated.
    Phase I was completed with publication in the Federal Register in May
    1999 for 25 identified ship discharges that require marine pollution
    control devices or other management control efforts. The next step is
    to establish performance standards for these 25 to-be-regulated
    discharges. This step has proven to be more complicated than originally
    thought. There are numerous combinations of vessel types, discharges,
    and control devices that must be considered. Navy and EPA are working
    to simplify this process by prioritizing the vessels and discharges of
    most concern and using a sequential rulemaking process. We will be
    updating the appropriate congressional committees on our progress later
    this year with a modified schedule for the Phase II rulemaking.
    Environmental Quality
        The Environmental Quality program is focused on ensuring that Navy
    and Marine Corps activities support fleet and fleet Marine readiness
    requirements in full compliance with U.S. environmental laws and
    regulations.\3\ Our environmental quality strategy emphasizes pollution
    prevention (P\2\) as a means to meet environmental compliance standards
    in a cost-effective manner. P\2\ eliminates the contaminant ``at the
    source'' through process changes and substitution of non-hazardous or
    less hazardous materials. Money invested in P\2\ can avoid permitting,
    sampling, testing to ensure that permit standards are met, and
    hazardous waste disposal costs. It can also improve safety and
    occupational health in the workplace.
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        \3\ At overseas locations, environmental standards are based on
    Final Governing Standards which, in turn, are based on host nation
    standards, Status of Forces agreements, or application of U.S.
    standards.
    ---------------------------------------------------------------------------

                                   CONCLUSION

        In conclusion, I believe our infrastructure is well positioned for
    the future. We are accelerating the solution to long-standing housing
    shortfalls for Navy and Marine Corps families and enlisted personnel.
    We are making real progress on family housing PPV, and look to apply
    these tools to bachelor housing. Funding to support our prior BRAC
    efforts is on track, and we have a strong environmental cleanup and
    property disposal plan for this year and next.
        We are working within the administration to identify ways to
    sustain the readiness of our forces. Although military commanders do an
    outstanding job of protecting and restoring natural resources in the
    areas used to train our people, urbanization and rigid application of
    some environmental requirements threatens our ability to train our
    sailors and marines to be ready for combat when the President calls. We
    need to ensure the appropriate balance between military readiness and
    the environment.
        This concludes my statement. I look forward to working with the
    subcommittee and staff to best support our sailors, marines, and our
    Nation.

        Senator Akaka. Thank you for your statement.
        Secretary Gibbs.

     STATEMENT OF HON. NELSON F. GIBBS, ASSISTANT SECRETARY OF THE
         AIR FORCE (INSTALLATIONS, ENVIRONMENT, AND LOGISTICS)

        Secretary Gibbs. Thank you, Mr. Chairman. I appreciate the
    opportunity to appear before you today to discuss the
    Department of the Air Force's fiscal year 2003 budget request
    for military construction, family housing and dormitories,
    environment programs, and realignment and closure programs.
        The Air Force's total military construction and family
    military housing programs play a vital role in supporting the
    Air Force's operational needs, workplace productivity, and
    quality of life. This subcommittee's support for those programs
    has remained steadfast over the years. Last year, the Secretary
    of Defense made a commitment to transform the Department of
    Defense's installations and facilities into those required for
    a 21st century military.
        Given the ever-present competing priorities, the Air Force
    has developed an executable and fiscally responsible plan for
    getting its facilities on a path to recovery. The Air Force's
    top priorities within this year's President's budget are to
    sustain the facilities that already exist; enhance quality of
    life by improving housing for both single and married members;
    complying with existing environmental statutes; and supporting
    new missions and weapons systems.
        For fiscal year 2003, the Air Force is requesting over $4.2
    billion to invest in Air Force facilities and infrastructure,
    approximately the same level as was submitted in the fiscal
    year 2002 request. This includes nearly $2 billion for
    sustainment, restoration, and modernization to maintain our
    existing infrastructure and facilities, an increase of over
    $360 million from fiscal year 2002.
        This budget request also reflects the Air Force's continued
    commitment to take care of its people and families. Their
    welfare is a critical factor to overall Air Force combat
    readiness and the family housing program, dormitory program,
    and other quality of life initiatives reflect a commitment by
    the Air Force to provide its people the facilities they
    deserve.
        The Air Force is requesting $1.5 billion for family
    housing, of which $700 million is to replace more than 2,100
    worn-out units at 23 bases and improve more than 1,700 units at
    11 bases. This request also supports privatization of more than
    4,500 units at five bases.
        To improve the quality of life for the unmarried junior
    enlisted members, the Air Force is requesting $135 million for
    its fiscal year 2000 dormitory program, which consists of 11
    enlisted dormitory projects, 10 stateside and one overseas.
        The fiscal year 2003 request also includes $500 million for
    Active Force military construction, $50 million for the Air
    National Guard, and $30 million for the Air Force Reserves.
    Included in those numbers are 33 new mission projects totaling
    over $350 million. The Air Force has been a leader and intends
    to continue to be a leader in environmental stewardship by
    focusing on its principles of enhancing operational readiness,
    being a good neighbor, and effectively applying its resources.
        To reach these goals, the Air Force has built an
    environmental program around four key pillars: cleanup,
    compliance, prevention, and conservation. The Air Force's
    compliance program strives to ensure compliance with all
    environmental law as it conducts its mission, and the Air Force
    is proud of its record on open enforcement actions, having
    reduced the total from 268 in 1972 to 17 in 2001. The
    environmental compliance military construction program in
    fiscal year 2003 includes four projects totaling $50 million in
    support of the Clean Air and Clean Water Acts.
        In conclusion, I wanted to thank the subcommittee for its
    continuing strong support of the Air Force military
    construction, family housing, and environmental programs. With
    the subcommittee's assistance and support, the Air Force will
    meet the most urgent needs of commanders in the field while
    providing quality facilities for the men and women who serve in
    and are the backboard of the most respected air and space force
    in the world.
        Thank you very much, Mr. Chairman.
        [The prepared statement of Secretary Gibbs follows:]

                   Prepared Statement by Hon. Nelson F. Gibbs

                                  INTRODUCTION

        Mr. Chairman and members of the subcommittee, good afternoon. I
    appreciate the opportunity to appear before you and discuss the
    Department of the Air Force's fiscal year 2003 military construction
    program, and the department's environmental and realignment and closure
    programs. Today, I will discuss with the subcommittee our investment
    strategies for facilities, housing, environmental programs, and utility
    systems.

                                    OVERVIEW

        The Air Force's total force military construction and military
    family housing programs play a vital role supporting Air Force
    operational needs, work place productivity, and quality of life. This
    subcommittee's support for those programs has remained steadfast over
    the years, and the Air Force is grateful. In recent years, the
    subcommittee's support for innovative programs such as privatizing
    military family housing has given the Air Force additional tools for
    improving the quality of life for its members, and that support has
    been appreciated.
        As Secretary Rumsfeld recently testified to Congress, ``. . .
    September 11 changed our Nation forever.'' The Air Force's challenge is
    to simultaneously accomplish three difficult missions: to win the war
    on terrorism; to restore the force through investments in procurement,
    people, and modernization; and to transform the force to meet 21st
    century demands. In the area of installations and facilities, this
    transformation began last year with the fiscal year 2002 budget.
        Last year, the Secretary of Defense made a commitment--to tranform
    the Department of Defense installations and facilities into those
    required for a 21st century military. Given the competing priorities
    resulting from September 11, the Air Force has developed an executable
    and fiscally responsible plan for getting its facilities on a path to
    recovery.
        While the Air Force acknowledges the importance of robust funding
    for facility sustainment and modernization, other priorities and
    insufficient Department of the Air Force topline have not permitted it
    to fully address the problems associated with an aging infrastructure.
    In fiscal year 2002, this administration proposed a significant
    increase in military construction and housing programs--to $2.7
    billion, the largest in the last decade. That increase was supported
    and, in fact, enhanced by this subcommittee and other members of
    Congress, and was welcomed by the Air Force.
        For fiscal year 2003, the Air Force is requesting over $4.2 billion
    to invest in Air Force facilities and infrastructure. This request
    includes $2.3 billion for total force military construction and
    military family housing, including $644 million for active force
    military construction, $1.5 billion for military family housing, $54
    million for Air National Guard military construction, and $32 million
    for Air Force Reserve military construction. In addition, the Air Force
    has increased the request for operations and maintenance sustainment,
    restoration, and modernization (SRM) funding by $360 million over the
    fiscal year 2002 request, bringing the total force facility investment
    request to the same level as submitted in the fiscal year 2002 budget
    request.
        These Air Force programs were developed using a facility investment
    strategy with the following objectives:

             Accommodate new missions;
             Invest in quality of life improvements;
             Continue environmental leadership;
             Sustain, restore, and modernize our infrastructure;
             Optimize use of public and private resources; and
             Continue demolition of excess, uneconomical-to-
            maintain facilities.

        Air Force missions and people around the world clearly depend upon
    this subcommittee's understanding of, and support for, the Air Force
    infrastructure programs. That support has never wavered, and for that
    the Air Force thanks you.

                            ACCOMMODATE NEW MISSIONS

        New weapon systems provide the rapid, precise, global capability
    that enables combat commanders to respond quickly to conflicts in
    support of national security objectives. The fiscal year 2003 total
    force new mission military construction program consists of 33
    projects, totaling $339 million.
        These projects support the initial basing of a number of new weapon
    systems; two of special significance are the F-22 Raptor and the C-17
    Globemaster III. The F-22 Raptor is the Air Force's next generation air
    superiority fighter. Tyndall Air Force Base, Florida, will house the F-
    22 flying training program. Nellis Air Force Base, Nevada, will be the
    location for F-22 follow-on operational test and evaluation. Langley
    Air Force Base, Virginia, will be home for the first operational
    squadrons. The requirements for F-22 related construction at Tyndall
    were funded in the fiscal year 2002 military construction program. The
    fiscal year 2003 military construction request includes one F-22
    project at Nellis for $3 million, and three F-22 projects as Langley
    totaling $40 million.
        The C-17 Globemaster III aircraft is replacing the Air Force's
    fleet of C-141 Starlifters. The C-17 provides rapid global mobility by
    combining the C-141 speed and long-range transport capabilities; the C-
    5 capability to carry outsized cargo; and the C-130 capability to land
    on short, forward-located airstrips. The Air Force will base C-17s at
    Charleston Air Force Base, South Carolina; Altus Air Force Base,
    Oklahoma; McChord Air Force Base, Washington; McGuire Air Force Base,
    New Jersey; and Jackson Air National Guard Base, Mississippi. Thanks to
    support from this subcommittee, construction requirements for
    Charleston, Altus, and McChord were all funded in prior-year military
    construction programs. The request for fiscal year 2003 includes a $25
    million facility at McGuire Air Force Base, two facility projects for
    $35 million at Jackson International Airport, and $31 million for C-17
    facilities at a soon to be announced location.
        Other new mission requirements in fiscal year 2003 include
    supporting the Air Force's Global Strike Task Force by building B-2
    aircraft hangars at Royal Air Force Fairford, United Kingdom, and B-2
    aircraft parking pads at Diego Garcia. To support the Space/C\2\ISR
    Task Force the Air Force will build facilities to base the Global Hawk
    unmanned aerial vehicle at Beale Air Force Base, California and to
    support the Defense Satellite Program and future SBIRS at Buckley Air
    Force Base, Colorado. Finally, to support the Global Response Task
    Force the Air Force will build facilities to support Combat Search and
    Rescue aircraft at Davis-Monthan Air Force Base, Arizona, C-130J
    aircraft at Little Rock Air Force Base, Arkansas, and expand aircraft
    parking at Naval Station Rota, Spain, and Ramstein Air Base, Germany.

                           INVEST IN QUALITY OF LIFE

        The Air Force is committed to taking care of its people and their
    families. Quality of life initiatives acknowledge the increasing
    sacrifices airmen make in support of the Nation and are pivotal to
    recruiting and retaining the Air Force's most important resource--its
    people. When members deploy, they want to know that their families are
    stable, safe, and secure. Their welfare is a critical factor to overall
    Air Force combat readiness, and the family housing program, dormitory
    program, and other quality of life initiatives reflect a commitment by
    the Air Force to provide its people the facilities they deserve.

                                 FAMILY HOUSING

        The Air Force Family Housing Master Plan provides the road map for
    meeting the Department of Defense goal of providing safe, affordable,
    and adequate housing for our members. The Air Force has increased its
    fiscal year 2003 housing request by $132 million over the fiscal year
    2002 request.
        The $677 million fiscal year 2003 military family housing
    replacement and improvement program replaces more than 2,100 worn-out
    units at 23 bases, improves more than 1,700 units at 11 bases, and
    supports privatization of more than 4,500 units at 5 bases. The Air
    Force housing privatization program will be covered in more detail
    later. The fiscal year 2003 housing operations and maintenance program
    totals $844 million.

                                  DORMITORIES

        Just as the Air Force is committed to provide adequate housing for
    families, it has an ambitious program to improve the housing for its
    unaccompanied junior enlisted personnel. The Air Force's dormitory
    master plan is a comprehensive, requirements-based plan, which
    identifies and prioritizes dormitory military construction
    requirements. The plan includes a three-phased dormitory investment
    strategy. The three phases are (1) fund the replacement or conversion
    of all permanent party central latrine dormitories; (2) construct new
    facilities to eliminate the deficit of dormitory rooms; and (3) convert
    or replace existing dormitories at the end of their useful life using
    the Department of Defense ``1+1'' room standard. Phase 1 is complete,
    and the Air Force is now concentrating on the final two phases of the
    investment strategy.
        The total requirement is 79,400 Air Force dormitory rooms. There is
    currently a deficit of 12,700 rooms, and the existing inventory
    includes 3,900 inadequate rooms. It will cost approximately $1 billion
    to execute the Air Force Dormitory Master Plan and achieve the fiscal
    year 2009 Air Force goal to eliminate the deficit and replace the worst
    existing dormitories.
        The fiscal year 2003 dormitory program consists of 11 enlisted
    dormitory projects at ten CONUS bases and one overseas base, for a
    total of $135 million. On behalf of all the airmen benefiting from this
    important quality of life initiative, I want to thank the subcommittee
    for its continued support of this critical quality of life effort.

                                FITNESS CENTERS

        Other quality of life investments include community facilities,
    such as fitness centers, vital in the effort to attract and retain high
    quality people and their families. A strong sense of community is an
    important element of the Air Force way of life, and these facilities
    are important to that sense of community as well as to the physical and
    psychological well-being of the airmen. The fiscal year 2003 military
    construction program includes fitness centers at Andersen Air Force
    Base, Guam; Hanscom Air Force Base, Massachusetts; and Royal Air Force
    Lakenheath, United Kingdom.

                                OVERSEAS MILCON

        The quality of overseas installations continues to be a priority
    for the Air Force because of the impact it has on both individual and
    family morale. Even though the majority of Air Force personnel are
    assigned in the United States, 14 percent of its forces are serving
    overseas, including 33,000 Air Force families. The Air Force overseas
    base structure has stabilized after years of closures and force
    structure realignments. At this level, the overseas infrastructure
    still represents 19 percent of the total Air Force physical plant. The
    fiscal year 2003 military construction request for European and Pacific
    installations is $233 million totaling 14 projects. The program
    consists of infrastructure and quality of life projects in Korea, the
    United Kingdom, Germany, Italy, and Spain as well as critical
    facilities on Guam, Diego Garcia, and Wake Island. The subcommittee's
    support for these operational and quality of life projects is equally
    as important as its support for stateside projects.

               PLANNING AND DESIGN/UNSPECIFIED MINOR CONSTRUCTION

        The Air Force will request $53 million in planning and design for
    fiscal year 2003. These funds are required to complete design of the
    fiscal year 2004 construction program, and to start design of the
    fiscal year 2005 projects. The Air Force is also requesting $21 million
    in fiscal year 2003 for the total force unspecified minor construction
    program, which is the primary means of funding small, unforeseen
    projects.

                     OPERATIONS AND MAINTENANCE INVESTMENT

        To sustain, restore, and modernize what it owns, the Air Force must
    achieve a balance between military construction and operations and
    maintenance programs. Military construction restores and re-capitalizes
    facilities. Operations and maintenance funding ensures the Air Force
    can perform facility sustainment activities, without which facilities
    would fail prematurely. Without proper sustainment, facilities and
    infrastructure wear out sooner. Operations and maintenance funding is
    also used to directly address many of the critical restoration and
    less-expensive recapitalization needs. Without these funds, commanders
    in the field are unable to address facility requirements that impact
    their near-term readiness.
        With last year's ``shot in the arm'' provided to military
    construction, the Air Force is now in a position to restore its
    operations and maintenance balance. In fiscal year 2003, the
    sustainment, restoration, and modernization share of the Air Force
    operations and maintenance funding is $2.0 billion--meeting the
    required sustainment level for the first time in many years. Included
    in this amount is $159 million in operations and maintenance programmed
    for restoration and modernization work.

                  OPTIMIZE USE OF PUBLIC AND PRIVATE RESOURCES

        In order to accelerate the rate at which it revitalizes its housing
    inventory, the Air Force has taken a measured approach to housing
    privatization. It started with a few select projects, with the goal of
    identifying successes and ``lessons learned'' to guide follow-on
    initiatives. The first housing privatization project was awarded at
    Lackland AFB, Texas, in August of 1998, and all 420 of those housing
    units are constructed and occupied by military families. There are
    three additional projects under construction that will result in 1,900
    privatized units at Dyess Air Force Base, Texas; Elmendorf Air Force
    Base, Alaska; and Robins Air Force Base, Georgia. In addition, the Air
    Force is on track to award eight projects in the next 12 months that
    will result in an additional 9,000 privatized units across the Air
    Force. On average, the Air Force has realized a five to one leverage on
    the military construction investment for housing privatization, and
    this kind of favorable ratio is expected to hold steady or even
    increase on other projects in the outyears. As mentioned earlier, the
    fiscal year 2003 budget request includes $7.8 million to support the
    privatization of more than 4,500 units at five bases: Maxwell Air Force
    Base, Alabama; Hanscom Air Force Base, Massachusetts; Cannon Air Force
    Base, New Mexico; Shaw Air Force Base, South Carolina; and F.E. Warren
    Air Force Base, Wyoming.
        The Air Force continues to pursue privatization of utility systems
    at Air Force installations. The goal is to privatize utility systems
    where it makes economic sense and does not negatively impact national
    security. The Air Force has identified 434 of 513 systems as potential
    privatization candidates, and has released requests for proposals for
    242 systems and have completed the process on 161 systems.

       CONTINUE DEMOLITION OF EXCESS, UNECONOMICAL-TO-MAINTAIN FACILITIES

        For the past 6 years, the Air Force has pursued an aggressive
    effort to demolish or dispose of facilities that are not economical to
    sustain or restore. From fiscal year 1998 through fiscal year 2001, the
    Air Force demolished 9.6 million-square feet of non-housing building
    space. It expects to demolish an additional 4.4 million-square feet in
    fiscal year 2002 and fiscal year 2003, for a total reduction of 14
    million square feet. This is equivalent to demolishing six Air Force
    bases equal to the combined square footage of Whiteman, Goodfellow,
    Moody, Brooks, Vance, and Pope Air Force Bases. Air Force demolition
    efforts continue to be a success story enabling it to reduce the strain
    on its infrastructure funding by eliminating unneeded facilities.

                            ENVIRONMENTAL LEADERSHIP

        The Air Force has remained a leader in environmental stewardship by
    focusing on its principles of enhancing operational readiness, being a
    good neighbor, and effectively applying its resources.
        To reach these goals, the Air Force built its billion-dollar a year
    environmental program around four key pillars--cleanup, compliance,
    pollution prevention, and conservation. It is now moving to the next
    level of excellence by beginning implementation of an environment,
    safety, and occupational health management system, based on the
    International Standard ISO 14001, to continually improve its mission
    performance by systematically reducing environment, safety, and
    occupational health risks and costs.
        The Air Force has made great strides in the cleanup of land and
    resources impacted by its operations, ensuring that it protects human
    health and the environment. Its strategy is to work with community
    stakeholders and evaluate relative risk, and then to cleanup or lower
    the risk at the worst sites first. The Air Force is on target to reach
    Defense Planning Guidance goals for cleanup of all ``high relative
    risk'' sites by 2007, and all ``medium relative risk'' sites by 2011.
    Staying the course will be a challenge as new cleanup standards are
    proposed for chemicals such as perchlorate and trichloroethylene. These
    new cleanup standards may cause both costs and timelines to change.
        The Air Force supports recommended changes to the military
    construction reporting process recommended by the Department of Defense
    for constructing remediation facilities to prevent delays and carry out
    its cleanup responsibilities.
        The Air Force's compliance program ensures compliance with
    environmental law as it conducts its mission activities. The Air Force
    is proud of its record on Open Enforcement Actions, having reduced them
    from 263 in 1992, to 17 in 2001. Its environmental compliance military
    construction program in fiscal year 2003 includes four projects
    totaling $47 million in support of the Clean Air and Clean Water Acts.
        Through its pollution prevention program, the Air Force has
    successfully reduced or eliminated pollution at the source. Its program
    allowed the Air Force to better the Department of Defense goal of 50
    percent reduction in hazardous waste between 1992 and 2000, achieving a
    50 percent goal by 1996, and then reaching a 66 percent reduction by
    2000.
        The Air Force's conservation programs offer some of the most
    visible and rewarding results of its commitment to being a good steward
    of its resources. Land set aside decades ago for the Air Force to
    conduct its military mission has also allowed unique American plant and
    animal species to flourish, and important American cultural resources
    and historic structures to remain preserved and appreciated.
    Ironically, it is precisely its commitment to conservation that now
    threatens the Air Force's ability to carry out its primary mission of
    protecting national security. Military installations, and test and
    training ranges, occupy land ``zoned'' for military operations and
    training. Additional demands from growing local communities, the
    resident plant and animal species now rare outside the installation
    boundaries, the installation's historic structures made significant due
    to past military successes, or the preserved relicts of early
    Americans, now create other land-use designations and limitations
    overlaid on land designated for military purposes. In most cases, these
    potentially competing requirements can be accommodated. The Air Force
    is working closely with the Department of Defense to develop its
    comprehensive strategy to address this issue of encroachment.
        The Air Force's environmental compliance military construction
    program in fiscal year 2003 includes four projects totaling $47 million
    in support of the Clean Air and Clean Water Acts. The program includes
    upgrading two coal-fired power plants in Alaska to meet environmental
    air emissions requirements. In addition, the Air Force is upgrading the
    water distribution and stormwater drainage systems at Vandenberg Air
    Force Base, California, to comply with environmental standards. All of
    these projects satisfy Department of Defense Class-1 requirements,
    which refer to conditions or facilities currently out of compliance
    with environmental laws or regulations, including those subject to a
    compliance agreement, or refer to projects and activities which, if not
    corrected, would result in an out of compliance situation in the
    current program year.

                            REALIGNMENT AND CLOSURES

        This summer the Air Force lowered the flags at Kelly and McClellan
    Air Force Bases, its two most complex closure actions resulting from
    the Base Realignment and Closure Act. The Air Force has now completed
    all 39 of its base closure and realignment actions (22 closures and 17
    realignments). As part of the closure process, the Air Force has worked
    with the local reuse authority at each base to minimize the impact on
    the local community from the closure. This effort has led to the
    creation of over 48,000 jobs and an annual payroll of $1.4 billion in
    the affected communities.
        While these facilities are being returned to their respective
    communities, the Air Force has a continuing responsibility for
    environmental clean up from past industrial activities. The Air Force
    takes this responsibility seriously, having spent $ 2.4 billion since
    1991 in environmental clean up at closing bases. For fiscal year 2003,
    the Air Force is requesting $119 million to continue the clean up.
        Although past base closure rounds have reduced its infrastructure
    footprint, the Air Force still retains excess infrastructure.
    Maintenance of this excess infrastructure forces the Air Force to sub-
    optimize use of available operations and maintenance funds. The
    National Defense Authorization Act for Fiscal Year 2002 provides the
    Air Force an opportunity to divest itself of this unneeded
    infrastructure. In preparation for the 2005 base closure round, the Air
    Force will focus first on sizing its force, and then on sizing the
    infrastructure to support that force.

                                   CONCLUSION

        In conclusion, I again thank the subcommittee for its strong
    support of Air Force military construction, family housing, and
    environmental programs. With the committee's assistance and support,
    the Air Force will meet the most urgent needs of commanders in the
    field while providing quality facilities for the men and women who
    serve in and are the backbone of the most respected aerospace force in
    the world.

        Senator Akaka. Thank you very much, Mr. Secretary.
        I have several questions.
        Mr. DuBois, was the likelihood that any particular base
    might be the subject of a future base closure action used as a
    criterion in deciding what bases would receive military
    construction funding for new facilities or sustainment funding
    for current facilities in assembling the fiscal year 2003
    budget request?
        Further, will such criteria be used by this administration
    in the preparation of the fiscal years 2004 and 2005 budget
    requests?
        Mr. DuBois. Mr. Chairman, as I tried to indicate in my
    opening remarks, there was no involvement because there is no
    current analysis that would yield categories of where excess
    capacity currently exists by force structure or fighting plans.
    I think it is important, as I indicated, to recognize that the
    only way to rationalize infrastructure is through BRAC, and we
    appreciate that authority. But a short answer to your question
    is no, we did not use the MILCON appropriation on the basis of
    certain bases getting one project or another.
        The Secretary of Defense testified that he and the Service
    Secretaries and Service Chiefs were focusing on mission
    critical requirements, highest of the high priorities. They
    funded competing priorities. With respect to the
    infrastructure, at OSD's level, and I think this is also true
    for the services, the decisions were made in a macro sense. If
    a particular installation received an investment for
    infrastructure, sustainment, restoration, or modernization, it
    was driven by requirements and was not facilities-centric.
        Senator Akaka. The Department of Defense has stated that we
    have 20 to 25 percent excess capacity in our facilities. Will
    the Department make every effort to use the existing capacity
    to house a new Commander in Chief for homeland defense, called
    the Northern Command (CINCNORTH), before requesting funds to
    build new headquarters facilities?
        Mr. DuBois. Mr. Chairman, with respect to the CINCNORTH,
    that proposal is in front of the President, the so-called
    unified command plan. The physical location of the headquarters
    of CINCNORTH, the responsibility being Canada, U.S., and
    Mexico, homeland security if you will, has not been determined.
    In point of fact, the Secretary only recently asked me to begin
    to think about what the options are, not just physical space. I
    want to just touch upon that in a second--what is available,
    where, and why.
        You can rest assured that at this time the Secretary is
    inclined to put the headquarters of such a CINC on current
    military reservation land. We do not intend to go and buy land,
    build, or lease space for it. It may be that we have to build
    something on a current military installation.
        The other issue is what are the criteria that one ought to
    follow to satisfy the requirements of such a CINC, given the
    mission? We are in the process of thinking that through.
    Homeland security within the Department of Defense is a new
    concept and one that drives us toward a new set of requirements
    for the CINC's physical location.
        Senator Akaka. I would ask each one of the three service
    witnesses to give us their assessment of the status of your
    facilities overseas, especially in Germany and Korea, and how
    the quality of the facilities our forces live and work in
    overseas compares to the facilities here in the United States.
    May I hear from all three service witnesses?
        Mr. DuBois. If I might just introduce their answers: The
    military construction and family housing budget,
    percentagewise, is 77-23, 77 percent in the United States, 23
    percent overseas. In terms of total DOD spending it is 79
    percent in the United States, 21 percent overseas. Each service
    has a slightly different cut on that.
        Senator Akaka. Secretary Gibbs.
        Secretary Gibbs. As in the United States, the foreign
    facilities run the gamut from some that are in very good shape
    that we are justifiably proud of and others that are not and
    need to be enhanced. In setting its priorities both for the
    housing activities and for military construction, the Air Force
    takes those into consideration. It ranks its projects
    notwithstanding their physical location and we believe we are
    working on those with the greatest need around the world.
        Senator Akaka. Secretary Fiori.
        Secretary Fiori. Yes, sir. As we look at both in the United
    States and overseas, our overall condition of our
    infrastructure is what we consider C-4 in our installation
    reporting status. In our housing area it is C-3 to C-4, which
    is not the highest in the world. Overseas housing, in general,
    is even poorer than what we have here and consequently,
    particularly in Korea, we are concentrating on putting new
    barracks in as rapidly as we can.
        As I mentioned, we are reorganizing in Germany to get to
    one facility instead of 13 facilities, and in consonance with
    that we are going to have a fairly major construction project
    for infrastructure housing and also the normal MILCON
    facilities. That should provide a significant improvement.
        Our other concern, particularly in Korea, is that we do not
    have much family housing, and that has affected the morale of
    our people on unaccompanied tours. We have goals to increase
    accompanied tours to 25 percent by 2010, and to get about half
    our families there by 2020.
        We have a decent plan to improve family housing overseas
    and we are certainly committed to executing it.
        Senator Akaka. Thank you.
        Secretary Johnson.
        Secretary Johnson. We believe that overseas facilities are
    equal and in some cases better than the U.S. facilities. As you
    well know, we get strong support in Japan and we have a large
    presence there. I talked about the home port ashore program.
    They will build those 5,000 rooms for us when the time comes.
        We have also invested heavily in Italy at Sigonella and
    other places. As you well know, we have not had a choice but to
    invest in Bahrain because of the activities there. In this
    year's budget we have $188 million in fiscal year 2003 for
    overseas MILCON and family housing together. We have stressed
    quality, and we have also gotten some support from the host
    nations.
        Senator Akaka. Thank you very much.
        Let me now call on my colleague for his questions.
        Senator Inhofe. Thank you, Mr. Chairman.
        I want to build a little bit on something you brought up. I
    was not going to, but I think it is significant. We are saying
    that it is just about three-to-one in terms of CONUS versus
    overseas, and we all know the reason for that. A major
    contributing reason is that there is no constituency overseas.
    I think it is natural that we at this table would be a little
    more concerned about things in our State than we are someplace
    else, everything else being equal.
        This is a serious problem. Every year we have gone through
    this thing. I just got back 2 weeks ago from looking at housing
    facilities in Baumholder, Germany. It is about as bad as I have
    ever seen in terms of the on-base family housing.
        Secretary Fiori, have you actually been there and seen that
    particular one?
        Secretary Fiori. No, sir.
        Senator Inhofe. I hope that you get a chance to see it.
    That has to be the poster child for the very worst, including
    stairwells where they have to walk up to the sixth floor and
    then walk all the way down to the basement to do laundry. It is
    something that should not have been tolerated. I am not blaming
    anybody. This is what you are inheriting and it is something we
    need to address.
        Secretary Fiori. Yes, sir.
        Senator Inhofe. Also, while there is some very good stuff
    that I have seen overseas, it seems like there is no plan for
    improvements.
        Secretary Gibbs, you have talked about how our retention is
    moving up due to September 11. I think we all understand that.
    But where are we going to be a few months or a few years from
    now? I can tell you right now that in terms of quality of life
    and retention the facility I mentioned just has to be
    addressed. We found some others almost that bad in different
    places.
        I would like to ask the four of you what ideas are out
    there to overcome this political obstacle of prioritizing
    things at home as opposed to overseas?
        Mr. DuBois. Senator, you clearly point out one of our
    problems.
        Senator Inhofe. Which is our fault, not yours. But how do
    we overcome it?
        Mr. DuBois. One of the interesting statistics is, as I
    said, that 77 percent of the MILCON is U.S., 23 percent
    overseas, with approximately 25 percent of our forces overseas.
        I think there are several ways we are going to try to deal
    with this. I have had several conversations with General
    Schwartz in Korea, as well as General Ralston, who I understand
    testified today. I spent nearly an hour with him when he came
    in from Europe to talk specifically about this issue.
        With respect to the two areas in particular, Korea and
    Europe, we have a land partnership program to reduce our
    footprint program. We are doing this because we have never
    supported adequately the infrastructure of our military in
    either place. We have to reduce that and use those precious
    MILCON and investment dollars in operations and maintenance,
    for sustainment, restoration, and modernization on a reduced
    amount of real estate and infrastructure.
        That is one way that we think we can better manage the
    appropriation which you make to our Department. I think the
    second thing has got to be privatization. You have heard a lot
    about privatization in the United States. We have a similar
    program in Europe called build to lease. These programs
    leverage private capital in Europe to build appropriate and
    adequate housing for our personnel, wherein we then lease it
    back.
        Similar to privatization in the U.S., we use the Bachelor
    Allowance for Housing (BAH) as the cash flow to attract private
    investment. It was a pilot project over the last several years
    and now it has proven itself.
        Senator Inhofe. There are some places where that is working
    quite well, too.
        Mr. DuBois. Yes, sir. I intend to work with my colleagues
    to try to make that happen in more places.
        Senator Inhofe. Rather than have our other three witnesses
    respond now, please do it for the record in writing, unless
    there is something you would like to add now.
        [The information referred to follows:]

        Secretary Gibbs. The Air Force facility investment strategy
    concentrates resources on its Total Force top priorities. The Air Force
    integrates Total Force MILCON requirements into a single priority list
    and funds the most urgent needs of the Total Air Force within budget
    constraints. Urgency of need takes precedence over ``fair share.''
    Geographic location is not a consideration. Because of the general
    condition of its overseas infrastructure, the Air Force is seeing
    greater portions of its budget request for overseas projects.
        In the fiscal year 2003 request, 32 percent of the Air Force's
    MILCON program is overseas, including 22 percent at permanent overseas
    locations and the additional 10 percent supporting warfighting missions
    at other than permanent locations (e.g., Diego Garcia). In fiscal year
    2003, 23 percent of the Air Force's family housing request is for
    overseas installations, consistent with the 22 percent of the total
    family housing inventory that is overseas.
        Secretary Johnson. To date, all of our attention has been focused
    on privatizing military family housing. We are now in a position to
    build on our experiences and apply the principles of privatization to
    address our critical bachelor housing needs. In November 2001, we held
    an industry forum with representatives from the development, property
    management, and financial segments of the private sector. Although
    bachelor housing privatization presents unique challenges, the
    consensus was that bachelor housing privatization can work. Finally,
    although Title 10 provides authority for bachelor housing
    privatization, there are some legislative obstacles that prevent
    implementation. We are prepared to work with the committees to address
    these considerations.

        Secretary Fiori. I did want to say two things. First, I
    said we wanted 50 percent of our families in Korea in 2010. It
    is 25 percent in 2010, 50 percent by 2020. Second, in Korea and
    in our request for Grafenwoehr, Germany, we are addressing many
    of these problems and we are doing the lease-build situation in
    Grafenwoehr as we consolidate. We need the support. This budget
    requests approximately $600 million through 2009 or 2010 just
    in Germany. It is a serious problem to get those resources, but
    we are going to work on it.
        Senator Inhofe. Building on something that our chairman
    brought up, let me ask a question in a different way: Are all
    of you saying that the delay in base closure is not related to
    the problems that we are having in getting these units funded?
    Do you all agree with that?
        Secretary Fiori. Yes, sir, I do.
        Secretary Johnson. I agree, sir.
        Secretary Gibbs. Yes, Senator. I went back and checked with
    the people who deal with the details and I am convinced that
    there was not a BRAC consideration in the determination of
    prioritizing the Air Force's request.
        Senator Inhofe. I am looking at the comptroller's report
    dated February 2002, which says in regards to modernization of
    infrastructure: ``Rate slowed by base closure dates.'' Is this
    incorrect?
        Mr. DuBois. As I tried to indicate, it is inescapable that
    we will have less infrastructure at some point after 2005 than
    we do today. Did that enter into the macro decision with
    respect to the five major accounts in defense? What was the
    only account to be less this year than the President's request
    last year? It was MILCON.
        Did BRAC delay, defer, imply, or impact to a measurable
    extent that the MILCON would go down by a specified amount? The
    answer is no. But it is inescapable that it is out there. I do
    not want to say that Dr. Zakheim was wrong. I want to say quite
    frankly that from my point of view the emphasis on BRAC was
    incorrect. As the three Assistant Service Secretaries have
    said, decisions were made on the basis of mission critical
    requirements, not installation-specific requirements.
        Senator Inhofe. If it was not a consideration, I will
    accept that and forget about this report.
        Let me just clarify my position. I have been supportive of
    the process. I was elected to the House in 1986 and Dick Armey
    came up with this idea and it was one that had to be addressed.
    You had to take politics out of it. I did support it and I
    supported it through the four BRAC rounds. It was not until the
    fourth one, the last one, when politics entered into it, the
    very thing that gave birth to the concept of having a non-
    political BRAC process.
        We have closed 96 major installations, 150 total. BRAC has
    worked well, but it fell apart this last time and that is what
    is creating the problem right now.
        The other problem is that we know from this meeting today
    and from previous hearings that even though we have had an
    increase of $48 billion, it is still inadequate in terms of
    taking care of the needs that we have out there. My feeling is
    we need to have access to as much money to take care of the
    immediate problems, some of those that we are talking about
    today.
        One thing we know for sure is that when you close an
    installation it costs money, for a period of 2 to 4 years,
    depending on the type of installation.
        I do not want you to think that I have always opposed the
    process. I was a supporter of the process. I also have to say
    that Oklahoma is the only State that has actually benefited
    from all four rounds, so that says something about Oklahoma.
        I am not going to overextend my time, but I briefly want to
    raise the concern I have had over a long period of time over
    the Vieques problem. I do not think any of you or anyone at
    this side of the table can remember a time or a place in
    history when we allowed a bunch of illegal trespassers to kick
    us off a range that we had.
        I have one of the largest ranges in my State of Oklahoma,
    Secretary Fiori, and it is one that they call the ``Sound of
    Freedom.'' We are talking about a huge range there. But this
    being the case, we wrote into the defense authorization bill
    last year provisions addressing Vieques, anticipating this may
    become a political issue and there may be politicians trying to
    cater to the Hispanic vote, whether that person at that time
    could have been Al Gore, George Bush, or John McCain. We
    actually wrote that certain things are going to happen if that
    became a reality.
        One of the things we wrote in to law is the closure of two
    major installations in Puerto Rico: Roosevelt Roads and Fort
    Buchanan. I would hope, and if you want to make any comment,
    that many of these benefits that have gone to the island are
    going to cease because they are there by virtue of the fact
    that we had that opportunity to use that range.
        Any comments on that in the panel as to that?
        Secretary Johnson. Certainly, sir. If we pull out of
    Vieques other activities that support it at Roosevelt Roads and
    so forth would be downsized accordingly. We certainly have not
    looked at the level of downsizing, whether we would have
    remaining missions there or not. But we agree with you that if
    you come out of Vieques you come out of the support base also.
        Senator Inhofe. That level actually is written into the
    law, so you might go back and look at that, because it is
    pretty specific. We had to do that because I did not want to be
    the bad guy coming along afterwards saying we have to revoke
    certain benefits.
        I would like to hear from Secretary Fiori and Secretary
    Gibbs. Vieques is critical for integrated training of marines
    and sailors, and as recently as 2 weeks ago I looked at the
    substitute they are using for that training. Everybody agrees
    it is not adequate. We have already had one accident in Kuwait
    that has cost six lives, five of which were American lives, as
    a result of not having live-fire training.
        I would like to know from the Army and the Air Force
    perspective, recognizing this is not just a Navy problem. If we
    allow Vieques to close, it is going to happen to other ranges.
    I would like to have you share with us the potential
    encroachment you might see from some of your ranges as a result
    if they are successful in closing Vieques.
        Secretary Fiori. Sir, our most recent experience are on
    encroachment was in the Massachusetts area and that had to do
    with the fact that the water was contaminated. We did have an
    agreement with the State that we could use the facility, but we
    cannot do live-fire training. So that certainly is a major
    handicap, but we believe we have sufficient ability and space
    there that we can do a certain number of work-arounds.
    Obviously, when you need live-fire training you are going to
    have to go to one of our facilities and that is going to take
    people away from their families.
        Similarly, in Hawaii we have only 37 allowable exercises a
    year and we have a need, just for the Army, for at least 18
    more per year. As I mentioned to you, that eliminates the
    access for our National Guard, our Reserves, and also the
    marines that were using our these facilities.
        We are looking at expanding our National Training Center.
    The encroachment there has more to do with environmental issues
    and time-distance. As I mentioned to you, we need some larger
    spaces if we are going to move faster.
        Senator Inhofe. You also have some protest encroachment
    there, too.
        Secretary Fiori. Yes, sir. Right now we are working around
    it. I visited Fort Hood and saw some training there. They are
    doing a good job of using creative means to train their
    soldiers in live firing. They have been innovative in their
    safety procedures. They always want to guarantee safety in live
    firing, but there are some very innovative ways that our
    soldiers have figured out how to use the geography of the place
    and not always firing to the same hole in the ground. There are
    some very imaginative ideas going on but it is a constant
    concern.
        Senator Inhofe. Secretary Gibbs.
        Secretary Gibbs. Secretary Fiori used the phrase that we
    hear a lot in the Air Force: work-around. We work each
    situation individually and have been successful in most
    situations to avoid substantive diminution in the training. But
    we are beginning to become concerned as people get closer to
    some of the reservations.
        I think you are aware of the Nellis Air Force Range. There
    is an innovative solution there. We have a load-out area off
    the end of the runway. We have airplanes taking off with live
    weapons headed to the range and developers wanted to come in
    and develop that area. We are working with the Department of
    the Interior to do a land swap to give the developer some other
    lands so that we can get that.
        We are managing the problem at this point, but we watch it
    very carefully.
        Senator Inhofe. As someone who has been involved in this
    issue for a long time, let me just be sure that you understand
    that right after the Vieques issue came up, all of a sudden
    there was a new way to close a range: protest and do things
    that are illegal. I was in Capo Teulada in southern Sardinia
    and there were articles in the newspaper saying, ``If they get
    by with that, why are we going to let them come over here and
    bomb our beach?'' The same thing in Cape Wrath in northern
    Scotland. I can show you the newspaper articles.
        So it affects all ranges. I know I have abused my time, but
    maybe for the record, Secretary Johnson, since I cannot stay
    for another round, you could address the National Environmental
    Policy Act (NEPA) thing. We know the NEPA process takes
    generally 18 to 24 months, but in case of ranges it takes 2 to
    3 years. If we are going to have a substitute we are going to
    have to go through that process. Is it safe to say that we have
    not started that process anyplace right now?
        Secretary Johnson. We certainly have been thinking.
        Senator Inhofe. Yes, but thinking does not help. If you are
    going to be closing it down in 2003 and it is going to take 2
    to 3 years to go through that process before an alternative
    comes up, that is a serious problem.
        Secretary Johnson. We have been thinking and we are
    progressing on some of the ranges that we can expand. We do not
    have an actual NEPA that has been signed yet, but we are
    preparing them.
        Senator Inhofe. Thank you.
        Thank you, Mr. Chairman.
        Senator Akaka. Thank you.
        Secretary--Senator Nelson.
        Senator Ben Nelson. Thank you very much. I have enough
    trouble being a Senator right now, Mr. Chairman. I am not ready
    to take on a secretary role as well. But thank you very much.
        Senator Inhofe. Particularly after today.
        Senator Ben Nelson. Particularly after today, exactly.
        I have two temptations right now. The first is to raise the
    questions of how you can decide what your needs and base
    support are before you have decided where you are going. But
    that is for another day if it comes back up, particularly in
    light of all the debate today and all the discussion about
    homeland security. I think the cart's clearly before the horse
    on this. I think it ought to be about base realignment.
        Voting for BRAC has created more opportunities for
    consultants to run around the country and help themselves as
    they work with communities and others to try to tell people how
    to keep from having their base closed. You can tell from my
    comment how I voted. But again, that is for another day.
        My second temptation is to commend you on the 3 percent
    budget reduction. But before I do I want to satisfy myself that
    it is not just a cost-cutting measure. I think it was George
    Will who said that in Washington if you want to get out of a
    10-foot hole this is the one place you can assume that you have
    an 11-foot ladder.
        Remember the fire station I talked about at Offutt,
    Secretary Gibbs? If you want to put things off and call it a
    hockey stick or if you want to force things out into year 2005,
    where I understand that that may be, then the question is, are
    you really dealing with the needs? I remember a year ago
    looking at all the leaky roofs and pipes, and so I have to ask
    myself and then maybe ask you the same, how can we suddenly
    with the budget process do more with less?
        As a former governor, I used to try to do that and I
    commend it when people do. I do not want to be critical of
    people who are trying to do that, if that is what the case is.
    But if it is just a matter of cost-cutting to show less in this
    budget so that there can be more money spent on other
    priorities, which I think are also important, then I raise a
    question of whether or not it is truly good budgeting process.
    I question if it is just making the numbers work out in the
    bottom line after you have decided what the bottom line is and
    work your way back.
        Maybe you can help me come to the conclusion that the leaky
    roofs are going to get taken care of. Senator Inhofe was
    concerned about what he saw. I just spent a night at K2 in
    Uzbekistan. I do not expect you to take care of the issues over
    there right now. That is temporary.
        Mr. DuBois. Not this year, at least.
        Senator Ben Nelson. That is exactly right. But I do know
    from my own personal experience of having seen the evidence of
    infrastructure not being taken care of that it is hard for me
    to believe that you can do all that job and still cut the
    budget 3 percent. It is also hard for me to believe that it
    does not have something to do with BRAC somewhere along the
    line.
        I think the extension of BRAC to 2005 threw a monkey wrench
    into a lot of this, because I do not know how you do decide to
    spend money on facilities without thinking if they will be
    around. I have done budgeting in the past myself, so I know the
    challenges. I am a friend of the court. I am not your enemy.
    But I do think I have the obligation to ask the difficult
    questions.
        Mr. DuBois. They are very difficult questions, Senator
    Nelson, and there are days, perhaps more days than not, when I
    think I have an 11-foot hole and only a 10-foot ladder.
        Senator Ben Nelson. Could be.
        Mr. DuBois. The issue of leaky roofs and pipes and broken
    windows are issues that are dealt with through the sustainment
    account. The sustainment, that is to say trying to maintain
    what we have now as best we can, is what, quite frankly, this
    budget is all about. It is true that last year we had an
    enormous increase in MILCON, as well as sustainment, with your
    help.
        I do want to point out that this year's MILCON request is
    the second largest in 6 years. Last year was the largest. But
    with respect to sustainment, what we call the operations and
    maintenance sustainment, is up year over year 2 percent for the
    Army. The Navy and the Marine Corps are up year over year 14
    percent. The Air Force is up year over year 18 percent.
    Sustainment was our number one priority, but it is true that on
    the restoration and modernization account, the account that
    would be used to replace a 20-year roof was drawn down.
        I was trying to explain this to my wife last night, and I
    said it would be as if you lived in Nebraska and in Washington,
    DC, and you maintained two homes. You have been here for some
    time and now you and your wife have decided that 3 years from
    now you are going to move to one or the other places. In the
    meantime, both houses have 20-year roofs, and their life is 20
    years. You probably are not going to replace the roof on either
    house until you have made the decision 3 years from now as to
    which house you are going to end up living in.
        The artificiality of my metaphor is obviously that in the
    case of the military we do not get to sell one of those houses.
    It is not like investing to get a higher return when I
    eventually sell the house or make the decision of which one to
    sell. I must give one of those houses to a nonprofit, in the
    case of the military, a no-cost economic conveyance. It is that
    kind of decision that creates the framework within which we
    live.
        To continue my analogy, while we might not replace the
    roof, we would repair all the windows, leaky pipes, and the
    garage door opener that is busted. I apologize that it is
    somewhat simplistic, but there is a certain similarity to the
    difficult decision that we face.
        Senator Ben Nelson. That is why I wondered about extending
    BRAC. If we are going to do BRAC, it seems to me that they
    ought to do it at the earliest possible moment, not extend it.
    You only extend the problem that much longer. Incidentally,
    keep the facilities in Nebraska because, if you are like we
    are, the hail took care of our roof last year and we have a
    brand new one.
        Mr. DuBois. I will make a note of that.
        Senator Ben Nelson. I understand the nature of the problem
    and that is why I say I want to be a friend of the process
    here. But I think we have to ask the difficult questions about
    whether or not BRAC is playing a big role in the concept. It is
    hard for me to believe it is not, but I take your word on it.
        I have been known as being tight as three coats of paint.
    As a matter of fact, part of the budget woes in Nebraska are
    due to the fact that I cut taxes. That is what somebody said
    the other day, which I think is fine.
        But I think it is important to put the money where it needs
    to be when it needs to be there, and I think increasing the
    amount in this area to take care of not just leaky roofs, but
    the other needs, is a good expenditure of money.
        Mr. DuBois. Yes, sir. I concur. Any of my colleagues want
    to comment?
        Secretary Johnson. Yes, sir. We intentionally placed our
    emphasis on quality of life and sustainment, as opposed to some
    of the MILCON. We're doing what you talked about. But we also
    placed a great emphasis, as did the other departments, on
    destroying buildings that are no longer needed on
    installations.
        We spend $45 million destroying buildings. I cannot imagine
    the savings we achieved. If you leave a building up, someone
    finds a use for it. So if we do not need it, we destroy it.
        Secretary Gibbs. The Air Force went through a lengthy
    debate in terms of how to use the construction funds and the
    conclusion was that we have to support that which we have
    first. They are deteriorating. When I first came on and got
    last year's installation readiness report (IRR), I was somewhat
    appalled. I got the next one 6 months later and it was not any
    better.
        So the Air Force has very specifically made the
    determination to put money into sustainment. We have also had
    the opportunity to spread it around better because the projects
    are smaller and we can cover more areas. In the new MILCON
    budget, the decision was principally in those cases where we
    have to be prepared to take on new missions and new weapons
    systems. As I said, over $350 million of the $500 million in
    new MILCON is for that. The remainder, which is only seven
    projects, are really for items that just had to be replaced.
    That was really the requirement. If we have something that has
    to be replaced, we put it in. If we can live with it another
    year, we are going to do that, and we are going to spread the
    money around.
        As it relates to your comment on BRAC, if you do not mind
    my taking a moment, I would agree with you that sooner would
    have been better, but that is not reality. Once the Air Force
    has made an overt decision, we will not be talking at all in
    calendar year 2002 regarding individual facilities. That time
    is going to be taken to do the force structure study, which is
    required to identify what must be based and generally or
    generically where it may be based. It is not relative to any
    individual facility. We will not start that process until 2003.
        Senator Ben Nelson. Thank you.
        Thank you, Mr. Chairman.
        Senator Akaka. Thank you very much for your statement.
        Since it has come up, I want to pursue the issue of
    encroachment. I am concerned that some in the Department view
    the so-called encroachment problem as one that is mainly caused
    by environmental statutes. In my view, the problem is much more
    complex and any effective solution must recognize and address
    the complex reality. We cannot single out one statute like the
    Endangered Species Act (ESA), if we want to seriously address
    this issue.
        The Department of Defense should not seek solutions that
    exempt it from the laws that others must follow. Any workable
    solution will require consultation and cooperation with other
    communities and interested parties.
        Last year, this subcommittee held a hearing on the impact
    of various factors that can affect military training, which
    some have called encroachment issues. At that hearing witnesses
    representing the three military services agreed that it was
    important for the Department to address environmental issues in
    partnership with States, local communities, and regulatory
    authorities. For example, General Robert Van Antwerp, the Army
    witness, explained that addressing these issues will ``require
    a partnership, strong emphasis on outreach, on community
    involvement. It means partnership with our friends and
    neighbors who border our installations. It means partnership
    with other agencies, the regulatory agencies that have the
    ability to govern and to determine what are the areas that
    should be set aside for threatened and endangered species and
    regulatory things.''
        I would like to ask would you agree that it is important
    for the Department to work in partnership with local
    communities and regulatory agencies to address encroachment
    issues, and will your Departments meet with other agencies and
    outside groups to attempt to reach consensus on any statutory
    or regulatory changes that may be proposed?
        Mr. DuBois. Mr. Chairman, as I indicated, the Deputy
    Secretary in December of last year set up an integrated team to
    represent each service and to represent various disciplines
    within the Department to assess the impact on realistic combat
    training and readiness. With respect to the term
    ``encroachment,'' encroachment is, as you have pointed out, not
    necessarily an issue which is solely focused on endangered or
    threatened species or environmental legislation of the past.
        We have a 30-year legacy in this country. In fact, I
    believe this is the 30th anniversary of the Clean Water Act.
    The Department of Defense recognizes its responsibilities with
    respect to environmental stewardship. I think that it has been
    documented and testified to by members of the Department, the
    Nature Conservancy, the EPA, and others, that the Department
    does a superb job, perhaps even second to none, when it comes
    to the maintenance of natural resources.
        Spectrum competition, urban density, and air space
    management all go into the encroachment basket. We are and we
    have been for the past several months in discussions in an
    informal and lower level way. It was not at the Cabinet level
    by any means, with EPA, the National Oceanic and Atmospheric
    Administration (NOAA), the Department of Interior, and the Fish
    and Wildlife Service, on issues that are of concern to us.
        I personally have met with Secretary Norton, Administrator
    Christie Todd Whitman, and the head of NOAA, Vice Admiral
    Lautenbacher, to discuss generalities and issues in this arena.
        I also want to address your very important point that all
    politics is local. The local land trusts, governments, and
    chapters of the Nature Conservancy are the entities with which
    we have worked in the past and continue to work in the future
    to expand, not contract, critical habitat in and around our
    military installations. As you probably know, at Fort Bragg,
    North Carolina, there is an active program with the Nature
    Conservancy and the Fish and Wildlife Service to allow property
    and lands around Fort Bragg to come under their control. In
    this case, this is so the critical habitat of the red-cockaded
    woodpecker is not solely within the fence line of the base, but
    rather extends outside the fence line, allowing us an
    opportunity to train effectively at Fort Bragg.
        Fort Hood, a military installation that is a corps
    headquarters with two divisions and an air cavalry regiment,
    has nearly 200,000 acres, of which 154,000 are devoted to
    training. Of that 154,000 acres, however, only 45,000 are
    unrestricted. The other 105,000 plus have some form of
    environmental restriction.
        We are trying to determine an appropriate balance. We are
    not making in any way, shape, or form a suggestion that
    amendments to environmental legislation is the way to go.
    However, there are administrative and regulatory actions which
    we are considering asking the administration to consider. The
    House Armed Services Committee has called a hearing to
    specifically focus on this issue. We are trying to determine
    how the Defense Department and the executive branch responds to
    these very appropriate questions.
        We know and recognize that in the final analysis we must
    work with the local communities to determine what is best for
    managing natural resources, including endangered and threatened
    species, on our current military installations.
        Senator Akaka. Thank you very much for that.
        I want to make a statement and hear how you feel about it.
    I must say that Makua, Hawaii, has been a model of how these
    issues can be resolved.
        Mr. DuBois. I agree with that, sir.
        Senator Akaka. I commend the services for the way they
    worked it out and for taking into consideration the community
    and their traditions. I thank you for that.
        Are there any further comments to make on that issue?
        Secretary Gibbs. I do not have any.
        Secretary Fiori. I do not.
        Secretary Johnson. I certainly support the joint effort.
        Senator Akaka. Thank you.
        I would like to ask the assistant secretaries of each of
    the military departments whether your operation and maintenance
    amounts fully fund 100 percent of your sustainment
    requirements, that is the amount needed to keep your facilities
    in current condition, in fiscal year 2003. If not, then how
    much additional funding would each department require to fully
    fund facilities sustainment?
        Do your sustainment requirements include all current
    facilities or are you basing your requirements on less than
    your current inventory in anticipation of the 2005 base closure
    round?
        Mr. DuBois. If I just might set the stage for my
    colleagues. As I indicated, facilities sustainment, both
    funding and requirements, is focused on our current footprint.
    It is not focused on some artificiality that we only want to
    sustain 20 percent less than what we really have. For all the
    services the requirement in fiscal year 2003 is $6.021 billion.
    We are sustaining it at $5.578 billion for a 92.6 percent
    level.
        Mr. McCord and Mr. Lauffer can do the mathematics, but the
    issue here is it is not 100 percent. The services range from
    the Air Force at 97.6 percent to the Navy at 83.9 percent. But
    there is also an uneven level of current conditions, if you
    will, in the services and therefore they have different levels.
    But all services were at a 92.6 level, an all-time high.
        It is true there is a delta and the delta is in the
    vicinity of $300 or $400 million. Would it be executable? I
    would have to defer to my colleagues. Perhaps Secretary Johnson
    wants to go first.
        Secretary Johnson. We certainly have to make tradeoffs as
    we build our budget and we intentionally did not go over 90
    percent on sustainment due to execution. Would we like to have
    more money? Of course we would, but there are other areas that
    probably would come first if we had discretionary funds.
        On sustainment, I am not sure I would ever want to do 100
    percent.
        Senator Akaka. Secretary Gibbs.
        Secretary Gibbs. I have a slightly different number than
    Mr. DuBois does. I do not know if it is in the numerator or the
    denominator, but the Air Force believes it funded 100 percent
    of the sustainment using the OSD model this year. That is an
    internal decision that we had made on sustaining what we have,
    and that was the guidepost that we used. I do not know whether
    there are more facilities that popped up late, but we believe
    we funded 100 percent.
        Senator Akaka. Secretary Fiori.
        Secretary Fiori. We set our Active, National Guard, and
    Reserves all at 92 percent. I think that is an achievable goal
    this year and we will be able to carry it out. We are still
    looking at the importance of barracks, strategic mobility, and
    transformation in the order of priorities as we established our
    budget for 2003.
        Senator Akaka. Secretary Fiori, the Army has announced the
    locations of four of six Interim Brigade Combat Teams. One of
    these will be the Second Brigade of the 25th Infantry Division
    at Schofield Barracks, Hawaii. Of course, I have supported the
    Army transformation effort. It is important that the Army
    provides the funding needed to make both these interim brigades
    and its larger transformation goals successful.
        The first question is what is the total funding required in
    terms of military construction, land acquisition, and related
    costs to modify the host installations for these new brigades?
    How much of that funding is in the fiscal year 2003 budget
    request and FYDP? Finally, how many of the six brigades does
    the funding in the FYDP support?
        Secretary Fiori. Yes, sir. For the fiscal 2003 budget we
    have $195 million. For fiscal year 2004 and out we are
    predicting a total amount of approximately $763 million for the
    six interim brigade combat teams. We will start spending on the
    Schofield Barracks brigade in 2004.
        For this year we have Fort Lewis, Fort Wainwright, and Fort
    Polk, where we are continuing to finish those facilities. The
    total amount for these six brigades from the very beginning was
    about $958 million. The total amount that will be at Schofield
    is $308 million.
        Senator Akaka. I am particularly interested, as I said, in
    knowing how we are coming along with the brigade combat teams
    and your plans of funding in the FYDP. That is the reason for
    the question. I understand that you are planning the funding
    for the six brigades in the FYDP.
        Secretary Fiori. Yes, sir, we are. I could give more detail
    for the record.
        Senator Akaka. Thank you.
        [The information referred to follows:]

                      Interim Brigade Combat Team Funding

        The total validated requirements for fiscal years 2002-2009
    military construction (MILCON), includes land acquisition, planning and
    design, operation and maintenance (O&M), environmental, and information
    infrastructure for all Interim Brigade Combat Teams (IBCTs) is over
    $2.37 billion.
        The requirements for each brigade are:

             Fort Lewis, WA (IBCTs 1 & 2)--$324.8 million;
             Forts Wainwright and Richardson, AK (IBCT 3)--$672.8
            million;
             Fort Polk, LA (IBCT 4)--$216.7 million;
             Schofield Barracks, HI (IBCT 5)--$615.1 million;
             Pennsylvania Army National Guard (IBCT 6)--$317.8
            million (includes requirements in PA and VA); and
             Planning and Design (P&D) for all IBCTs--$174.1
            million.

        The Army has funded in fiscal year 2002, or programmed in the
    Future Years Defense Plan over $1.2 billion for the IBCTs.
        The funded and programmed amounts for each brigade are:

             Fort Lewis, WA (IBCTs 1 & 2)--$285.7 million;
             Forts Wainwright and Richardson, AK (IBCT 3)--$299.1
            million;
             Fort Polk, LA (IBCT 4)--$171.9 million;
             Schofield Barracks, HI (IBCT 5)--$326.7 million;
             Pennsylvania Army National Guard (IBCT 6)--$99.9
            million; and
             Planning and design (P&D) for all IBCTs--$39.9
            million.

        All six brigades are supported by the programmed amounts in the
    President's Budget FYDP.
        The Army is addressing shortfalls between requirements and
    currently programmed amounts in the fiscal year 2004-2009 Program
    Objective Memorandum (POM).

        Senator Akaka. The Army had been funding the cleanup of
    formerly utilized defense sites (FUDS) at a level that would
    lead to remedies in place by 2014. This year the Comptroller
    arbitrarily stretched the program out to 2020 to reduce the
    funding level required. At best, however, the Army expects to
    have remedies in place for unexploded ordnance problems by
    2089. I would like to ask this question to Mr. DuBois and
    Secretary Fiori. Do you believe that 2089 is an acceptable goal
    for addressing problems with unexploded ordinance at formerly
    utilized defense sites? If not, do you plan to seek additional
    funds for UXO?
        Mr. DuBois. Mr. Chairman, let me be clear about this. The
    FUDS funding levels are determined at OSD level. The United
    States Department of the Army is the executive agent and
    executes the program. I want to compliment them. They have
    executed very well. But I do not want to place the burden on
    them for certain decisions that were made at OSD level.
        It is a very difficult program, make no mistake about it.
    We are on track to complete the requirements of the National
    Defense Authorization Act for Fiscal Year 2002, section 313,
    which requires us to provide a plan, an assessment, a schedule,
    and a cost estimate for the FUDS program to Congress by April
    2003. As you indicated, the DOD Comptroller, Dr. Zakheim,
    adjusted the FUDS goal from 2014 to 2020 in large measure
    because of the strong fiscal realities we currently face in the
    Department.
        The one thing that I can say to you now, having worked with
    Dov Zakheim for the past year, is that he is very committed and
    insistent on as honest a portrayal of programmatic issues as
    possible as they translate into financial requirements over
    time.
        I do not know whether 2089 is correct. I share with you a
    hesitancy to embrace such a number. It is so far away. But as
    we all know the characterization of ranges, active, closed,
    closing, or transferred, is a difficult task. However, we are
    committed to doing better job of that. As I indicated, we will
    report to you by April 2003, as required under section 313. In
    that regard, one of the first letters that I drafted when I
    took this job last spring, I believe Deputy Secretary Wolfowitz
    signed it to Congress, admitted that we do not have good
    software or characterization data for transferred or closed
    ranges with UXO. It is difficult. We intend to honor our
    commitment and obligation to report to you by April 2003.
        The money involved, which is rather large over time, is
    still yet to be determined. We are doing the best we can within
    the fiscal constraints.
        Senator Akaka. Thank you, Mr. DuBois, I understand that the
    DOD Comptroller has determined that, contrary to the
    Department's longstanding practice, only military construction
    funds may be used for environmental projects costing more than
    $750,000. Several members of the panel have made reference to
    this problem. The question is do you expect to propose
    legislation to address this issue? If you do, then when can we
    expect to see it?
        Mr. DuBois. I would like to take that question for the
    record, sir. But I want to just have, if I might, a
    clarification. Are we talking about the $750,000 MILCON
    threshold below which we do not have to identify, or are we
    talking about an issue pertaining to environmental programs?
        Senator Akaka. These would be those used for environmental
    projects that cost more than $750,000.
        Mr. DuBois. I will take that question for the record, and
    report back to you.
        [The information referred to follows:]
            Use of MILCON for Environmental Restoration Requirements
        Mr. DuBois. Yes, the proposed legislation addressing this issue was
    submitted with the MILCON bill last month. The issue arose as a
    consequence of the 1998 Defense Authorization Act, amendment to section
    2811, of 10 U.S.C., which included a definition of repair. This change
    was in response to what Congress perceived as abuses connected to the
    environmental restoration program. The new definition does not permit
    the services to continue to define repair as including environmental
    restoration of the installation's soil. This was an unintended
    consequence of the amendment. Consequently, all environmental
    restoration account funded environmental restoration that fits the
    definition of construction must now be classified as military
    construction.
        As MILCON, such projects are now subject to all the paperwork that
    MILCON requires, including individual notifications to Congress. This
    will significantly increase the number of such notifications as well as
    cause delays in the restoration program while those packages are
    processed. Because of the need to ensure communications to Congress are
    accurate, such notifications require extensive time to prepare and
    review before approval. Such notifications delay environmental
    restoration actions, drain resources that would otherwise be applied to
    environmental restoration, and are redundant given the annual
    restoration reports already provided to Congress.
        Our legislation proposes changes to section 2810 of 10 U.S.C.,
    which would return the status of environmental restoration projects to
    virtually the same position they had prior to the enactment of the
    statutory definition of ``repair'' provided in the amendment to section
    2811 of 10 U.S.C.

        Senator Akaka. The House energy bill contains a provision
    that would require all Federal buildings to be metered within 5
    years. I understand that the Department of Defense considers
    the provision to be burdensome and unworkable. Yet metering is
    acknowledged to be an important tool for understanding and
    controlling energy costs. Is the Department prepared to put
    together an alternative to the House provision which would
    contain realistic objectives and timetables and still
    accomplish the objective of encouraging energy conservation
    through the use of metering within the boundaries of DOD
    facilities?
        Mr. DuBois. The answer is somewhat complicated, as most
    answers in this arena are. I have on my desk, as a matter of
    fact, a views report that I read yesterday. I edited it. I will
    re-edit it when I get back tonight.
        DOD installations are metered. But many, in fact most, of
    the DOD buildings are not metered. Let me put this into two
    baskets if I can. We are committed to metering family housing,
    especially family housing that is being privatized, built, or
    rehabilitated, because we want to, obviously, inject some
    discipline in the system. It is estimated that it will cost
    $1.5 billion to meet a mandatory metering requirement. That is
    a lot of money.
        We recognize that metering can play a useful role in energy
    conservation, but we would suggest that it is not necessarily a
    universal solution.
        On the issue of energy consumption reduction, I think the
    Defense Department has a very good record. All four services,
    all three military departments, have a very good record. I come
    from a background wherein I devoted a number of years to energy
    conservation in the industrial sector. You are absolutely
    right, metering is a wonderful discipline. But it is not the
    only discipline that one can use to reduce energy consumption
    per financial unit.
        I will recommend to the Deputy Secretary that he sign this
    views letter back to you. It does address the H.R. 4 and S.
    1766 issues raised both with respect to mandatory metering
    provisions and other provisions, such as the royalty schedule
    for geothermal production on military property. We will provide
    answers in that views letter, but as a practical matter at this
    point it is a very expensive proposition to meter at every
    building that we have.
        The square mileage of lands and buildings owned by DOD is
    in excess of the State of Pennsylvania. This is all the more
    reason to do everything that we can to conserve energy and to
    use renewable energy, too. That is the best answer I can give
    you right now, and we will continue to give you more refined
    answers in the future.
        I do not know if any of my colleagues want to address the
    energy issue.
        Secretary Johnson. We have been very successful, as I
    mentioned in my opening comments, with energy conservation. We
    agree on metering, but our people are really committed to
    conserving energy and doing a tremendous job.
        Senator Akaka. Secretary Johnson, in your written statement
    you state the Navy's position that it has met the goals of the
    legislation passed by Congress to allow public access for
    cultural, religious, and educational purposes on the island of
    Kaho'olawe, Hawaii, which was utilized as a bombing range. This
    is despite the Navy's inability to meet the goals in the
    memorandum of understanding (MOU) with the State of Hawaii,
    which addressed the clearance of UXO on Kaho'olawe.
        I fully understand the difficulties associated with
    clearing ordnance on this island. However, I also know that the
    Navy's ability in the eyes of the Hawaiian community to fulfill
    its obligations with respect to Kaho'olawe will have a major
    impact on the willingness of the local communities in Hawaii to
    work with the military on difficult issues. What are the Navy's
    plans to meet its obligations with respect to the clearance of
    ordnance on the island of Kaho'olawe, and would an increase in
    funding assist the Navy in meeting the goal set forth in the
    MOU agreed to in 1994?
        Secretary Johnson. Yes, sir. At the beginning of this year
    we were at 43 percent of the goal, and I think it is the same
    on the MOU. I gave a copy to your staff, and would like to come
    visit with you and the experts to go over the goals versus the
    MOU. At the current funding level we will be at 62 percent when
    we finish in 10 years. That is November 2003. If we have
    continued adds, as we have in the past, we can get up to 80
    percent, and we would like to ensure that we are meeting the
    MOU as you and the State of Hawaii want us to. We would bring
    the contractor as well as the engineering experts.
        Senator Akaka. I thank you very much for that.
        The Navy has continued to clear Kaho'olawe and it is coming
    to a point now where the Navy will be passing it to the State
    of Hawaii, and I am particularly interested in the clearance.
        Secretary Johnson. We would like to talk to you about what
    happens in November 2003, whether you want the Navy and our
    contractor team to continue or if you want to have a
    relationship with the States.
        Senator Akaka. I know this has been a long hearing now. I
    thought that was the right time. [Laughter.]
        Mr. DuBois. It does not seem that long, sir.
        Senator Akaka. I thank you so much. You have been so
    responsive to our questions. I would like to thank all of the
    witnesses for your testimony. This subcommittee looks forward
    to working with you to address the difficult issues we have
    discussed today and others that will be facing us.
        With respect to encroachment, the Department needs to
    continue to work with the local communities, States, and
    organizations to address these issues. Similarly, it is
    important that the Department fulfill its obligations as it
    reflects the credibility of the Department. I look forward to
    working with all of you in the days ahead, and I want to wish
    all of you well in your responsibilities. We are doing the best
    for our great country as we face today's challenges.
        A person made a remark to me that I was surprised about,
    and it made me think. The person asked, ``Are we in a war?'' We
    are. We have certainly declared war on terrorism. As the
    President said, it is going to be a long one, but we are in
    that situation. As such, we are trying the best we can, and you
    are too, to continue to provide the best quality of life for
    our troops, wherever they are, and give them the best training.
    In the future, I hope we can also help them with further
    compensation and pay increases.
        All of us we need to think about the future. Again, I want
    to thank you. I do not know whether you have any closing
    comments you want to make.
        Secretary Fiori. No, sir. Thank you.
        Mr. DuBois. Thank you very much, Mr. Chairman.
        Senator Akaka. This hearing is adjourned.
        [Questions for the record with answers supplied follow:]

                 Questions Submitted by Senator Daniel K. Akaka

                              UNEXPLODED ORDNANCE

        1. Senator Akaka. Secretary Fiori, the Army has been funding the
    clean-up of BRAC sites at a level that would lead to remedies in place
    by 2005. The Army has excluded Unexploded Ordnance (UXO) problems from
    this effort, providing only a minimal level of funding for UXO. As a
    result, facilities with significant UXO problems will not meet the 2005
    clean-up goal. Do you believe that it is acceptable to set aside UXO
    problems at BRAC facilities to be addressed at a later date, or should
    the Army be addressing these problems now?
        Secretary Fiori. The Army is addressing UXO problems as part of its
    overall effort to ensure that BRAC properties are suitable for
    transfer. The Army is providing funds to perform munitions responses,
    which includes the removal of UXO, at its BRAC installations. As of the
    end of fiscal year 2001, the Army has spent approximately $90 million
    on munitions responses at BRAC sites. This fiscal year, the Army plans
    to spend an additional $20.2 million. The Defense Planning Guidance
    (DPG) for BRAC properties establishes a goal for complete cleanup for
    hazardous and toxic wastes by fiscal year 2005, but the DPG does not
    currently establish goals for munitions responses. Nevertheless, the
    Army is committed to performing adequate responses at its properties.
    Because of the complexity and multitude of challenges associated with
    the conduct of munitions responses, properties with significant
    munitions-related issues will not be ready for transfer by fiscal year
    2005. Some of these challenges are: gaps in existing UXO identification
    and discrimination technologies; the collective inability to quantify
    risks posed by UXO; and overlapping Federal and State environmental
    laws and regulations. The Army and the Department of Defense, in
    coordination with other Federal agencies, the States, and the Tribes,
    are actively addressing these challenges.

                            REPLACEMENT FOR VIEQUES

        2. Senator Akaka. Secretary Johnson, Secretary England has stated
    that the Navy plans to find a replacement for Vieques by May 2003. Any
    funds needed to prepare an alternative location by that date would have
    to be expended in fiscal years 2002 and 2003. Has the Navy requested
    any funding in the fiscal year 2003 budget to set up an alternative
    site or sites for east coast training? If not, how can the Navy hope to
    meet Secretary England's goal?
        Secretary Johnson. Funding was not included in the fiscal year 2003
    President's budget. Different alternatives are being considered in
    development of the FYDP in fiscal year 2004 as the fleet requirement
    solidifies. A funding profile has not been finalized, but Navy intent
    is to support the validated requirements for interim and long-term
    measures to support infrastructure improvements and environmental
    documentation for some of our east and gulf coast facilities and Range/
    OPAREA complexes that will ensure fleet readiness.

        3. Senator Akaka. Secretary Johnson, has the Navy prepared an
    estimate of how long it is likely to take and how much it is likely to
    cost to get a replacement training range up and running?
        Secretary Johnson. The Navy anticipates that a combination of
    alternative training sites, methods, and various advance technologies
    using simulation will provide the required mix of training
    capabilities. The Navy is waiting for the CNA study, which will provide
    recommendations on future training options. In addition, the Navy is
    developing a strategy to repair and upgrade existing training ranges
    supporting Atlantic Fleet pre-deployment training and to build
    cooperative efforts with other services. The strategy will provide the
    resources to reverse degradation of range infrastructure and associated
    support facilities, improve realism of pre-deployment training, and
    take advantage of available technology to further enhance training. It
    is envisioned that the strategy will increase the capacity and
    capability of ranges supporting Atlantic Fleet commanders and improve
    their flexibility in reacting to disruptions such as weather, periodic
    reduction, or loss of access to a particular range facility without a
    resulting loss in training fidelity. This strategy, however, has not
    been finalized.

                           POLICY ON LAND ACQUISITION

        4. Senator Akaka. Mr. DuBois, it is my understanding that any
    request by the military departments to acquire more than 1,000 acres of
    land, or any land worth over $1 million, must be approved in advance by
    the Office of the Secretary of Defense. I also understand that the
    services generally have not considered acquiring land they do not
    actually plan to train on because they have no specific military use
    for it. Acquiring such buffer zones to provide space between training
    areas and the local communities, or perhaps to provide critical habitat
    that is not also a critical training area, might be useful in
    preserving key training ranges. Is the Department of Defense
    considering this as one approach to preserve key training areas?
        Mr. DuBois. The Department recognizes that targeted land
    acquisitions can be very useful in preserving key training ranges, and
    the proposed legislation includes a provision that would enhance the
    Department's ability to preserve open space in the vicinity of military
    installations. This proposal would authorize the Secretary of each
    Military Department to enter into agreements with any private
    organization that has the conservation, restoration, or preservation of
    land and natural resources, or a similar objective, as its stated
    principal organizational purpose or goal, to preserve high-value
    habitats or forestall incompatible development.

                        HOUSING PRIVATIZATION IN HAWAII

        5. Senator Akaka. Secretary Johnson and Secretary Fiori, both the
    Navy and the Army are contemplating housing privatization in Hawaii. To
    date, this privatization of military housing has not been attempted in
    Hawaii, in part due to the issue of ceded lands. What are your
    Department's plans for housing privatization in Hawaii, and how do you
    plan to deal with the unique land ownership issues there?
        Secretary Johnson. The Navy and Marine Corps' family housing master
    plans include privatization of existing military family housing on the
    island of Oahu. Funding for the first phase is included in our Fiscal
    Year 2003 budget request. None of the housing identified for the first
    phase is sited on ceded lands. We will review records to determine
    what, if any, housing in future phases may be on ceded lands.
        Secretary Fiori. The Army plans to privatize 8,178 homes in Hawaii
    (3,045 housing units at Fort Shafter and 5,133 units at Schofield
    Barracks) during 2003. Major milestones include:

      Notify Congress of Solicitation.........  June 15, 2002
      Conduct Industry Forum/Issue              August 28, 2002
       Solicitation.
      Notify Congress of Community Dev & Mgt    January 2003
       Plan (CDMP) Award.
      Select Developer to Prepare CDMP........  February 2003
      Notify Congress of Project Execution....  October 2003
      Issue Partner Notice to Transition/       November 2003
       Proceed.
      Transfer Operations and Assets to         March 2004
       Developer.

        A majority (60 percent) of Army family housing in Hawaii is located
    on ceded lands. However, the Army's approach to privatization will
    minimize legal concerns regarding ceded lands because, the Army retains
    title to the land. Additionally, the Army retains a vested interest in
    the project, as a member of a Limited Liability Corporation (LLC).
    Finally, the land and improvements will continue to be used to house
    military families. In February 2002, the Army's privatization team met
    with the local Hawaiian congressional delegation and Chamber of
    Commerce Military Advisory Committee to discuss the Army's
    privatization efforts in Hawaii. Coordination will continue among all
    key stakeholders. At the recommendation of the local congressional
    delegation, the Army plans to contact the State's Attorney General
    office to brief the Army's military housing privatization program and
    discuss any legal issues or questions they may have.

                   PRIVATIZATION OF BACHELOR ENLISTED HOUSING

        6. Senator Akaka. Secretary Johnson, your statement mentioned the
    Navy's interest in attempting to privatize the operation of bachelor
    enlisted quarters in the Navy. Although this authority has existed for
    several years, no such projects have been attempted. Why does the Navy
    believe this approach is now more likely to succeed?
        Secretary Johnson. To date, all of our attention has been focused
    on privatizing military family housing. We are now in a position to
    build on our experiences and apply the principles of privatization to
    address our critical bachelor housing needs. In November 2001, we held
    an industry forum with representatives from the development, property
    management, and financial segments of the private sector. Although
    bachelor housing privatization presents unique challenges, the
    consensus was that bachelor housing privatization can work. Finally,
    although Title 10 provides authority for bachelor housing
    privatization, there are some legislative obstacles that prevent
    implementation. We are prepared to work with the committee to address
    these considerations.

        7. Senator Akaka. Secretary Johnson, what impact would
    privatization have on the character of such facilities, including their
    role in promoting unit cohesion?
        Secretary Johnson. I strongly believe that the privatization of
    bachelor housing is compatible with service goals, such as unit
    cohesion and team building. We expect that service bachelor housing
    assignment policies, which are based on these goals, can carry over to
    privatized housing.

                                FORCE PROTECTION

        8. Senator Akaka. Mr. DuBois, is the Department of Defense
    attempting to assess the requirements and costs of the higher force
    protection standards we are implementing, and may well be using for the
    foreseeable future, at our facilities around the world? Is the
    Department of Defense attempting to fund such construction costs,
    including the relocation or significant renovation of existing
    facilities, in the near-term using emergency funds, or will this mostly
    be a long-term effort built into future military construction budgets?
        Mr. DuBois. The ``DOD Anti-Terrorism Standards for Buildings,''
    establishes the minimum requirements for force protection. We perform
    vulnerability assessments at 80 to 100 installations per year. The
    installation commanders take that information and determine the level
    of protection required. As a result, some projects may require higher
    than minimum standards. Based on the fiscal year 2002 and fiscal year
    2003 military construction programs, we are predicting a 3 to 5 percent
    increase in costs. This varies, depending on the type of project,
    whether it is new construction or renovation, and the percentage of
    renovation. In the fiscal year 2002 program, the added costs ranged
    from 1 percent to 28 percent.
        The Department is requesting emergency funds only for those
    projects with an immediate need for force protection. Upgrading all
    Department of Defense facilities according to our force protection
    standards will be a long-term process. We expect these costs to be part
    of future military construction programs.

                          ARMY INSTALLATION MANAGEMENT

        9. Senator Akaka. Secretary Fiori, the Army is planning a new
    installation management structure under which the funds needed to run
    and maintain Army bases would be placed under your control and would no
    longer be available to the division commanders to deal with unexpected
    training needs without the approval of senior Army leaders. How would
    division commanders work with the garrison commanders (who will report
    to you and the Assistant Chief of Staff for Installation Management) to
    set requirements and priorities, and deal with real-world changes,
    under this new structure?
        Secretary Fiori. I fully expect division commanders and the
    garrison commanders will continue to work together as they are now.
    Garrisons commanders, by the nature of their command, are charged with
    servicing the needs of their Army community. However, execution of
    training remains the responsibility of division commanders. Our
    garrison commanders have flexibility with their base support funding,
    and we will also retain flexibility at the Installation Management
    Agency to address unforeseen circumstances within the garrison
    commander's area of responsibility.
        To ensure mission commanders are closely involved in setting
    installation management requirements and priorities, we are placing the
    senior mission commander in the rating chain for our garrison
    commanders. The division commander at a division post, such as
    Schofield Barracks or Fort Drum, will be the garrison commander's
    senior rater. In the Army culture, that is the best means to ensure
    satisfactory customer service to senior commanders. To provide further
    influence at a senior level, commanding generals will sit on our new
    Installation Board of Directors, helping to set priorities and
    strategies for Army installations.

               MILITARY CONSTRUCTION FOR NATIONAL MISSILE DEFENSE

        10. Senator Akaka. Mr. DuBois, does the Department of Defense plan
    to use any military construction funding for construction of a national
    missile defense system, and if so, does the fiscal year 2003 budget or
    Future Years Defense Program contain military construction funds for
    this program?
        Mr. DuBois. No military construction funds are requested in fiscal
    year 2003 for Ground-Based Midcourse (GMD) (formerly National Missile
    Defense) construction. All construction funds are in RDT&E. In fiscal
    year 2002, the Administration requested, and Congress approved,
    legislation that stated the following: ``(1) The Secretary of Defense,
    using funds appropriated to the Department of Defense for RDT&E for
    fiscal years after fiscal year 2001 that are available for programs of
    the Ballistic Missile Defense Organization (now MDA), may carry out all
    construction projects, or portions of construction projects, including
    projects for the acquisition improvement, or construction of
    facilities, necessary to establish and operate the Missile Defense
    System Test Bed; and (2) The authority provided in subsection (a) may
    be used to acquire, improve, or construct facilities at a total cost
    not to exceed $500,000,000.''
        In fiscal year 2002, $281 million of RDT&E funds was appropriated
    for GMD construction. The budget request for fiscal year 2003 for GMD
    construction is $137 million.

                           NAVY ENCROACHMENT STRATEGY

        11. Senator Akaka. Secretary Johnson, your prepared statement
    focuses on critical habitat when discussing concerns about training.
    However, a Department of Defense issue paper identifying encroachment
    issues that the Navy currently faces at various bases found that at 8
    of the 14 bases, the problems came from noise, airspace restrictions,
    or unexploded ordnance, rather than from environmental constraints.
    What steps is the Navy taking to develop a comprehensive encroachment
    strategy that addresses all of the many factors that have an impact on
    Navy training?
        Secretary Johnson. The DON and DOD have developed a comprehensive
    approach to improve and manage DOD ranges, including encroachment
    issues. The Senior Readiness Oversight Council (SROC) identified
    recapitalization, modernization, and sustainability as the key issues
    in improving and maintaining DOD ranges. The SROC is addressing
    recapitalization and modernization of ranges separately and has
    established an Encroachment Integrated Product Team (IPT) to coordinate
    all issues of encroachment. The IPT is developing action plans to
    address specific encroachment issues, and oversees their
    implementation. Another important group reporting to the SROC on
    encroachment issues is the Operational and Environmental Executive
    Steering Committee for Munitions (OEESM). OEESM has developed the DOD
    Munitions Action Plan (MAP) addressing life-cycle management of
    munitions for range sustainment. DOD also manages issues on a regional
    basis, specifically the Southern California/Arizona region. The
    strategy will engage stakeholders and range managers to identify issues
    and develop solutions to regional encroachment that will be applied
    nationally if successful. In addition, DOD has established planning
    goals, and DON is budgeting for comprehensive range sustainability
    studies at Navy and Marine Corps ranges. These studies will include
    Range Complex Management Plans, regulatory compliance evaluations, on-
    site contaminant assessments, and encroachment vulnerability analyses.
    DOD and the services are actively communicating the importance of a
    balance between military readiness and environmental stewardship with
    environmental groups, the public, other stakeholders, and members of
    Congress and their staffs.
        In addition to these programmatic solutions to encroachment, DOD
    and the military services have been in discussions with OMB, the
    Council of Environmental Quality, the Environmental Protection Agency
    (EPA), the Fish and Wildlife Service at the Department of Interior, and
    the National Oceans and Atmospheric Administration (NOAA) at the
    Department of Commerce. Together, as a team, and with the help of
    Congress, we will work to find solutions. If the administration decides
    to pursue statutory clarifications, we are ready to work closely with
    the appropriate congressional committees on any necessary
    clarifications.

                              CONTRACTS WITH ENRON

        12. Senator Akaka. Mr. DuBois, please provide a list of the
    contracts for the provision of energy services or any utility
    privatization contracts that the military departments and the defense
    agencies had with the Enron Corporation at the time it declared
    bankruptcy; a description of whether the services the government
    contracted for are still being provided; and in any cases where there
    was a default, how those services are now being provided.
        Mr. DuBois. The Department has contracted directly with Enron or
    its subsidiaries in three areas--utilities privatization, natural gas
    procurement, and renewable energy  purchases.
        The Army awarded Enron Federal Solutions Inc. (EFSI) the contract
    for privatization of the water, wastewater, natural gas, and electric
    systems at U.S. Army Garrison, Fort Hamilton, NY. The contract called
    for EFSI to upgrade these utility systems prior to conveyance. EFSI
    made the capital investments to upgrade most of the utilities
    infrastructure, but has stopped performing the operations and
    maintenance functions. The operations and maintenance services are
    currently being provided by an existing base operating support
    contract. The Army filed a stipulation with the bankruptcy court to
    obtain permission to terminate the contract and is expecting funds from
    the performance and payment bonds to support completion of some of the
    contracted work. The Army plans to competitively re-solicit the
    privatization contract.
        The Defense Energy Support Center (DESC) awarded Enron Corporation
    contracts to supply natural gas to Federal customers at various
    locations. These contracts were terminated for default on December 1,
    2001, because Enron was unable to deliver  the gas. The customers were
    able to revert to gas supplied by the local utility, so there was no
    interruption of service. DESC has since awarded new contracts to other
    suppliers.
        In May 2001, the Air Force contracted with Enron to supply
    renewable power to Edwards AFB. This contract was part of the
    Department's plan to reduce electricity demand from the commercial
    power grid in the western U.S. Although Enron is still providing power
    under this contract, it is uncertain that this will continue much
    longer. DFAS is holding payment in abeyance pending a ruling by the
    bankruptcy court. If necessary, Edwards AFB will procure electricity
    from the local utility supplier--the Western Area Power Administration
    (WAPA)--at the tariff rate. WAPA is soliciting for a new supplier.
        Additionally, there are two instances where DOD was procuring
    electricity from Enron indirectly.
        The Navy entered into an interagency agreement with WAPA in March
    2001 to obtain 80-megawatts of electricity for 12 Navy and Marine Corps
    installations in the San Diego region. WAPA then procured the
    electricity from Enron. Although Enron has continued to supply the
    electricity as contracted, WAPA has made arrangements with the
    California Independent System Operator to ensure no interruptions of
    service occur, should Enron fail to deliver.
        Hanscom AFB, MA, has an agreement to purchase electricity from the
    General Services Administration (GSA), which obtained the power from
    Enron. GSA has already awarded a replacement contract to another
    supplier.

                           CENTRAL COMMAND FACILITIES

        13. Senator Akaka. Mr. DuBois, are emergency funds being used at
    this time only for temporary needs related to Operation Enduring
    Freedom, or also to construct facilities that U.S. forces intend to use
    on a long-term basis?
        Mr. DuBois. The fiscal year 2003 Defense Emergency Response Fund
    request is designed to respond to, or protect against, acts or
    threatened acts of terrorism against the U.S. The majority of military
    construction projects are for construction of perimeter security and
    gates, providing increased security in the long-term. Some of the
    projects may be used on a short-term basis, but most will be used for
    the foreseeable future.

                              CORROSION PREVENTION

        14. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, studies now being prepared for submission to Congress
    have found that the Department of Defense incurs at least $20 billion
    each year in damage to equipment and weapon systems because of
    corrosion. Are you aware of similar studies, analyses, or reports on
    the effects and costs of corrosion for military infrastructure and
    facilities?
        Secretary Fiori. The Army Corps of Engineers, Engineer Research and
    Development Center (ERDC) is aware of many studies including the
    following recent study of the national cost of corrosion by CC
    Technologies and the National Association of Corrosion Engineers (NACE)
    International: ``Corrosion Costs and Preventive Strategies in the
    United States,'' Report to Federal Highway Administration (FHWA),
    Office of Infrastructure Research and Development, Report FHWA-RD-01-
    156, September 2001. This report concluded that the national direct
    cost of corrosion in the U.S.A. was $276 billion. The total annual
    direct cost of corrosion incurred by the military services for systems
    (military equipment and hardware) and infrastructure is approximately
    $20 billion. For DOD facilities, this study concludes the following:
    ``Information on corrosion-related costs for these DOD assets was not
    available; however, based on other studies described in this report, it
    is reasonable to assume that these costs are on the order of several
    billion dollars annually.''
        Secretary Johnson. We are not aware of any service-wide study of
    the cost of corrosion for military infrastructure and facilities. About
    5 years ago, Naval Facilities Engineering Service Center (NFESC)
    conducted a sampling of the Commander in Chief, Pacific Fleet
    (CINCPACFLT) claimant level efforts and determined that sustainment and
    restoration projects to address operational waterfront facility
    corrosion problems has cost CINCPACFLT approximately $5 million per
    year. Considering a similar impact for Commander in Chief, Atlantic
    Fleet (CINCLANTFLT) would create a requirement in excess of $10 million
    for the fleet. This does not account for corrosion projects to correct
    problems related to non-critical facilities such as building exteriors,
    fences, antennas, or other metal structures.
        Secretary Gibbs. The Air Force is not aware of any such studies
    related to corrosion for military infrastructure and facilities.

        15. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, how much of your facility maintenance budgets are
    dedicated to fixing or preventing corrosion-related damage?
        Secretary Fiori. Our sustainment requirement does not separately
    identify costs for corrosion. The operation and maintenance (O&M)
    funding is allocated to the major commands and installations to repair
    our most critical readiness requirements that includes corrosion as a
    component of the total project.
        Secretary Johnson. Based on the NFESC study, the annual cost of
    corrosion for the Naval Shore Establishment is estimated to exceed $10
    million for critical facilities. Corrosion prevention in facilities is
    normally addressed as part of the installation recurring maintenance
    and thus more precise estimates are not readily available.
        Secretary Gibbs. The Air Force does not distinguish between the
    annual cost of corrosion damage/maintenance (Question 18) and how much
    of our facility maintenance budgets are dedicated to fixing or
    preventing corrosion-related damages (Question 15). Additionally, the
    Air Force does not specifically track day-to-day maintenance (including
    man-hours expended) to prevent or fix corrosion damage, nor does the
    Air Force track the annual cost of corrosion control or related damages
    to Air Force facilities and infrastructure.
        The Air Force does have corrosion control programs established at
    each installation and have been successful in reducing and preventing
    our corrosion maintenance requirement. For facilities, those programs
    are multi-faceted in scope, generally centered on protective coatings,
    cathodic protection, and industrial water treatment.
        Facility requirements to restore or prevent corrosion-related
    damage to facilities compete for available funds with other facility
    needs based on their impact to the installation mission. The amount
    will therefore vary from year to year. However, these requirements are
    primarily accomplished by contract when funded.

        16. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, what initiatives are you taking to reduce corrosion
    maintenance costs?
        Secretary Fiori. The following initiatives currently underway help
    to reduce corrosion related maintenance costs:
        (a) Army Corps of Engineers sponsored PROSPECT Training in
    Corrosion Control has been conducted annually since 1975;
        (b) Army Corrosion Control Technology Program at select
    installations demonstrates and implements emerging corrosion control
    technologies; and
        (c) All new construction of underground distribution systems or
    storage tanks use nonmetallic materials where appropriate. Where
    nonmetallic materials are technically impractical or not life cycle
    cost effective, coatings and cathodic protection systems are provided
    to eliminate or minimize external corrosion. Hydronic heating and
    cooling systems often include automatic systems for the chemical
    treatment of water to minimize or prevent internal corrosion.
        Secretary Johnson. Corrosion initiatives initiated through Naval
    Facilities Engineering Command (NAVFAC) include:

             Establishing corrosion control technical expertise at
            the Naval Facilities Engineering Service Center (NFESC);
             Conducting periodic base corrosion surveys. Work done
            by the technical experts, NAVFAC Engineering Field Division
            (EFD) corrosion managers, or by contract;
             Activity, EFD, and NFESC personnel collaborate to
            determine corrosion control requirements for POL facilities for
            programming by the Defense Energy Support Center Corrosion
            Control Program;
             Periodic waterfront underwater assessment surveys
            managed by technical experts at the NFESC;
             Revision of outdated design criteria to install proper
            corrosion control during initial installation to avoid
            unnecessary maintenance costs;
             Corrosion control training classes, as requested, are
            conducted periodically throughout the Naval Shore
            Establishment;
             The NAVFAC Engineering Network (ENET), as well as
            corrosion technical expert web sites, are established to
            identify Navy personnel knowledgeable in corrosion control,
            transfer lessons learned, and help field personnel obtain
            assistance with corrosion control problems; and
             Research and development investments into corrosion
            resistant paints and application techniques, as well as
            corrosion control practices.

        Secretary Gibbs. The Air Force's intent is to reduce corrosion
    maintenance requirement through effective corrosion prevention
    programs. For facilities, those programs are multi-faceted in scope,
    generally centered on protective coatings (exterior facility painting),
    cathodic protection (protecting underground metal piping and above
    ground storage tanks), and industrial water treatment (internal
    treatment of heating and cooling systems). In recent years, the Air
    Force has outsourced the majority of these operations. In those cases,
    it has found the use of blanket purchase agreements and requirements
    contracts as an effective way to reduce its contract costs.

                               CORROSION CONTROL

        17. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, corrosion control and prevention is an essential
    element of a maintenance program. However, because of its nature,
    corrosion has been simply accepted as a normal degradation of military
    equipment. In planning for maintenance, the military services and the
    Department of Defense have done little to train their technicians and
    have not specifically allocated funding to address corrosion of
    facilities and equipment. When formulas are developed to project
    military maintenance costs, corrosion is rarely considered. Do you
    document the impact of corrosion on your facilities? If so, who
    provides the information? Where is that information stored? Is it used
    in resource planning and determining facility maintenance requirements?
    Is such information made available and shared with others? If you do
    not document the impact of corrosion, why?
        Secretary Fiori. The Army has documented the impact of corrosion on
    its facilities via Army-wide corrosion surveys until 1998.
        This information is currently stored at the U.S. Army Engineer
    Research and Development Center (ERDC) Construction Engineering
    Research Laboratory (CERL) in Champaign, Illinois.
        It has been used in research resource planning and determining
    maintenance requirements.
        It is made available and shared with Army Installations, Major
    Commands (MACOMs), and the Assistant Chief of Staff for Installation
    Management (ACSIM).
        Secretary Johnson. The impact of corrosion is documented in
    individual reports of corrosion control surveys conducted under
    NAVFACENGCOM and Defense Energy Support Center (DESC) Corrosion Control
    Programs. These survey reports are stored either at activities,
    NAVFACENGCOM Engineering Field Divisions (EFDs), or at DESC. This
    information is being used to identify corrosion related projects, and
    to some extent, prioritize such projects. As an example, at their
    request CINCPACFLT and the NFESC have collaborated in developing a
    single report summarizing cathodic protection (one major method of
    corrosion control) status at all CINCPACFLT activities and prioritizing
    the deficiencies at each activity. DESC uses information from surveys
    conducted under their program to develop their execution plans.
        Secretary Gibbs. Facility maintenance programs are managed by
    engineers at each Air Force installation. Those engineers conduct
    recurring facility inspections, during which they gather and document
    maintenance requirements in databases stored at each installation.
    Corrosion management is part of these recurring facility inspections.
    As each installation develops its annual budget request for facility
    maintenance, it considers corrosion prevention and maintenance
    requirements (along with all other facility maintenance requirements).
    As funds are appropriated by Congress and made available to each
    installation, installation commanders then execute their facility
    maintenance programs.

        18. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, what is the annual cost of corrosion damage/
    maintenance for your military facilities?
        Secretary Fiori. The annual direct cost of corrosion/maintenance is
    not provided for in the budget process and is not available.
        Secretary Johnson. Based on the NFESC study, the annual cost of
    corrosion for the Naval Shore Establishment is estimated to exceed $10
    million for critical facilities. These costs are part of the
    installation's recurring maintenance and thus more precise estimates
    are not readily available.
        Secretary Gibbs. See answer to question no. 15.

        19. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, where do you receive your guidance for corrosion
    management?
        Secretary Fiori. The Army Corps of Engineers and my office, the
    Office of the Assistant Secretary of the Army (Installations and
    Environment), provide technical and policy guidance, respectively. In
    general, the installations use industry standards and practices via
    contract support.
        Secretary Johnson. A Tri-Service Committee develops all guidance
    for the Department of Defense. In response to the Appropriations
    Conference Report 105-247 and the DOD Installation Policy Board
    directive of January 13, 2000, the Tri-Service Committee on Unified
    Design Guidance was formed. The Naval Facilities Engineering Command,
    the Army Corp of Engineers, and Air Force Civil Engineering Support
    Agency develop all new DOD facility guidance jointly. One example of
    this in the corrosion control area is the Unified Facility Criteria
    (UFC) document UFC 3-570-06 which provides Tri-Service guidance on
    maintenance and operation of cathodic protection systems, and which is
    under final review by the Air Force.
        Secretary Gibbs. The Air Force works together with the other
    services, service laboratories, and the private sector corrosion
    maintenance industries, including both the National Association of
    Corrosion Engineers (NACE) International and the Steel Structure
    Painting Council (SSPC), to collect and implement guidance on corrosion
    prevention and maintenance.

        20. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, do you provide guidance to your military units on
    corrosion management? If so, in what format and to whom?
        Secretary Fiori. The Army provides guidance to the Army
    Installation's Director of Public Works (DPW) staff on corrosion
    mitigation through Technical Manuals and Bulletins.
        Secretary Johnson. Guidance is provided through various methods
    including:

             NAVFACENGCOM Design Criteria and Instructions.
            Criteria are updated periodically and distributed to Navy
            Design and Public Works Departments. A NAVFACENGCOM corrosion
            control program instruction is currently being revised.
             NAVFACENGCOM corrosion control technical experts at
            NFESC and Engineering Field Divisions provide guidance to field
            personnel through technical reports, training classes, and
            electronic and telephonic means.

        Secretary Gibbs. Yes. The Air Force Civil Engineer Support Agency
    (AFCESA) at Tyndall AFB, FL is the lead agency for providing facility
    corrosion maintenance technical assistance to Air Force installations.
    They do so on an as-requested basis. In addition, AFCESA publishes
    technical papers and operating guidance made available to the field via
    various forms of electronic media. When requested and practical, AFCESA
    personnel visit installations to provide on-site technical assistance.

        21. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, do you conduct periodic inspections of facilities to
    ensure they are being maintained to published standards? Do these
    inspections include the analysis of the impact of corrosion? If not,
    why?
        Secretary Fiori. The Army uses an annual report, the Installation
    Status Report (ISR), as a tool in determining the quality and quantity
    of facilities Army-wide. The ISR uses Army-wide standards developed by
    the Army staff to measure the condition of facilities.
        Occupants of the buildings do the inspection using rating sheets
    and booklets. Several of the booklets, especially those pertaining to
    medical facilities, include specific corrosion reporting items. As a
    result of these inspections, the condition of the facilities are
    classified as red, amber, or green. Sustainment, renovation, or
    construction costs are then developed.
        ISR does not separately analyze the effects of corrosion. This type
    of inspection would require technical analysis. Corrosion within pipes
    is a difficult check since it requires shutting down the system and
    dismantling the pipes. This causes disruption of service to a
    customer's facility and is usually only discovered when repairs are
    being done.
        Secretary Johnson. Yes, Navy and Marine Corps activities conduct
    periodic inspections of the facilities and document deficiencies:

             Activities conduct some specialized inspections/
            maintenance of corrosion control systems either in-house or by
            contract;
             NFESC/EFD technical experts conduct periodic base wide
            corrosion and waterfront underwater inspection surveys that
            include analysis of corrosion control systems such as cathodic
            protection; and
             Periodic surveys of POL systems at Navy activities are
            conducted under a Defense Energy Support Center corrosion
            program when such a requirement has been justified.

        The inspections conducted by the NFESC/EFD technical experts and
    the inspections conducted under the DESC program will most often
    include analysis of the impact of corrosion. Activity specialized
    inspections will sometimes include such analysis.
        Secretary Gibbs. The Air Force does not conduct any centrally
    directed formal inspection program for corrosion maintenance at its
    installations. However, each Major Command conducts installation visits
    to inspect installation infrastructure, including the different aspects
    of corrosion maintenance. Each installation commander is responsible
    for performing recurring facility inspections, gathering and
    documenting facility maintenance requirements, and utilizing available
    resources to best meet those requirements.

        22. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, do you receive guidance from the Department of Defense
    on corrosion management? If so, from what office? If not, from whom
    would you expect to provide this guidance?
        Secretary Fiori. We do not receive specific guidance for corrosion
    management from the Department of Defense. My office, the Office of the
    Assistant Secretary of the Army (Installations and Environment),
    provides policy guidance and the Army Corps of Engineers provides
    technical guidance for construction projects.
        Secretary Johnson. The Office of Under Secretary of Defense
    (Installation and Environment) provides guidance on corrosion control
    developed by the Tri-Service Committee on Unified Design Guidance.
    Currently, Unified Facility Criteria (UFC) document UFC 3-570-06, which
    provides Tri-Service guidance on maintenance and operation of cathodic
    protection systems, is under final review by the Air Force.
        Secretary Gibbs. The Air Force does not receive specific guidance
    from DOD on facility corrosion prevention and maintenance, nor does it
    require it. The Air Force works with the other services and industry to
    develop the corrosion prevention and maintenance guidance it needs.

        23. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, how do you ensure that your corrosion-related
    maintenance is safe for the environment and the personnel who perform
    the maintenance?
        Secretary Fiori. All procedures and chemicals used by installations
    are in compliance with applicable Occupational Safety and Health
    Administration, Environmental Protection Agency, and State and local
    regulations.
        Secretary Johnson. The Department has safety and environmental
    offices at the Navy and Marine Corps headquarters down to the
    individual installations that monitor compliance. Environmental
    personnel are involved in the design and review process of these
    projects. Corrosion technical experts participate in military and
    private sector committees developing military criteria and industry
    standards to ensure environmental compliance. They keep abreast of
    changing environmental and safety requirements from such agencies as
    EPA, Office of Underground Storage Tanks, and the Office of Pipeline
    Safety. Updated information is sent to field personnel through criteria
    updates, technical reports, project reviews, and electronic/telephonic
    means.
        Secretary Gibbs. Corrosion maintenance-related environmental
    guidance is established and distributed by the Air Force Civil Engineer
    Support Agency, based on its crossfeed with the other services and the
    corrosion maintenance industry. Further, the environmental protection
    and safety experts on each Air Force installation work with the
    installation maintenance and contract personnel to ensure only
    environmentally/occupationally safe products are used on the
    installation.

        24. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, if you were able to reduce the frequency of corrosion-
    related maintenance, what benefits, including cost savings, would you
    project for military resources and the environment?
        Secretary Fiori. While we are unable to project cost savings, it is
    expected that the major benefit is that the life cycle costs are going
    to be significantly lower because of life extension of facilities and
    equipment. The reliability and readiness of facilities will also be
    increased, which is critical for systems that contain or transport
    substances that could harm people or the environment, such as natural
    gas or transportation fuels.
        Secretary Johnson. Reduced frequency of corrosion-related
    maintenance would allow sustainment resources to be applied to other
    requirements. Corrosion control systems that are properly designed,
    installed, and maintained could result in significant cost avoidance.
    For example, a pipeline with a properly designed coating and cathodic
    protection system will be free of leaks for the designed service life.
    The cost to install and maintain the corrosion control system is
    usually much less than it takes to periodically replace or perform a
    major repair to the pipeline. One major fuel leak could result in
    environmental cleanup/penalty costs of $500,000 to $2,000,000. In
    addition, by prolonging the lives of facilities, the costs for
    premature major repairs or replacements will be avoided.
        Secretary Gibbs. In addition to the cost savings from avoided
    material replacement, the Air Force expect benefits would include
    manpower savings and a reduction in hazardous waste generation.

        25. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, for corrosion-related facilities maintenance, who does
    the work? What are the annual costs? How many man-hours are expended
    annually on corrosion repairs?
        Secretary Fiori. The Installation Department of Public Works staff
    and contractors perform the corrosion related maintenance work. The
    Army does not track or have records which report maintenance work
    specifically for corrosion control or repairs.
        Secretary Johnson. A mixture of in-house and contract personnel
    accomplish corrosion-related facilities maintenance work. The mixture
    is dependent on the extent of the work and the capability of the in-
    house force. Costs and man-hours are not specifically collected for
    corrosion repairs, and are thus not readily available.
        Secretary Gibbs. See answer to question no. 15.

        26. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, can you provide an analysis of the return on
    investment from corrosion repairs or preventative measures?
        Secretary Fiori. We are unable to provide specific information on
    return on investment from corrosion repairs or preventive measures.
    Anecdotal evidence suggests that the return on investment resulting
    from a properly executed corrosion control program for utilities and
    facility components is between 10 to 1 and 100 to 1.
        Secretary Johnson. Economic analyses have been used to justify many
    corrosion control projects, but historical return on investment numbers
    have not been kept.
        The cost of implementing corrosion control typically amounts to
    about 15-20 percent of the total facility construction, depending on
    the type of construction. Corrosion systems would also require some
    small amounts of annual investment for operation and periodic
    maintenance. A properly designed and maintained corrosion control
    system can extend the life of a structure for 15-20 years, and if the
    corrosion control systems are replaced every 15-20 years, the
    structural life can be extended indefinitely. The maintenance,
    operation, and periodic system replacement costs far less than major
    repairs or replacement of a structure caused by uncontrolled corrosion.
        Other impacts that can be avoided as a result of preventing
    corrosion are:

             Downtime and disruption of service;
             Expensive loss of product (fuel);
             Environmental and safety hazards and costs;
             Decreased system capacity (e.g. loss of a storage
            tank); and
             Adverse impacts on operational readiness.

        Secretary Gibbs. No, the Air Force does not currently track
    separate investments made on separate corrosion repairs or preventative
    measures, as these are embedded in each installation's other
    infrastructure maintenance and repair programs.

        27. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, for your corrosion maintenance, do you use materials,
    techniques, and processes prescribed by military commands or
    laboratories, or are you using commercial products and processes? Are
    they safe? Are they effective? Do they provide a savings to the
    government?
        Secretary Fiori. The materials, techniques, and processes for
    corrosion maintenance are generally prescribed by manufacturers and
    suppliers. The laboratories assist in the proper selection and
    evaluation of materials and technologies. Judiciously selected
    materials, techniques and processes for corrosion control are widely
    accepted as safe and effective, and have been shown to reduce costs of
    operations and maintenance.
        Secretary Johnson. Occasionally, the Department will use techniques
    and processes prescribed by military commands when they are found to be
    superior to commercial products or where commercial standards are too
    general or vague to ensure the required quality. For the most part, the
    Department uses commercial products for facility corrosion maintenance.
        For example, in September 2001, Tri-Service Paints and Coatings
    Guide Specification was revised to replace all references to Federal
    and military coating standards with Non-Government Standards (NGS)
    coating standards. The NGS's reference commercial, off-the shelf
    products instead of the combined formulation/performance requirements
    of the Federal and military standards. Application techniques and
    processes utilized in guide specifications also reference NGS
    standards. The NGS standards are created/developed and maintained by
    committees of field experts so they are the safest and most effective
    techniques possible. Using these standards saves government dollars by
    not having to develop and maintain MIL specifications.
        Navy technical experts also work with environmentally concerned NGS
    organizations to set goals and standards that meet, and preferably
    exceed regulatory requirements. This is done to meet the intent of
    Executive Order 13101: Greening the Government Through Waste
    Prevention, Recycling, and Federal Acquisition.
        Secretary Gibbs. In general, products prescribed by the military
    commands and laboratories are the same as the commercial products and
    processes used in industry. The Air Force continually interfaces with
    the private sector and academia, most commonly through industry forums,
    and thus tries to stay current with and take advantage of the latest
    technologies whenever possible. The products and processes used by the
    Air Force for corrosion maintenance are as safe and effective.

                  CORROSION CONTROL--ROLE OF LABS AND ACADEMIA

        28. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, each of the military services has a laboratory system
    that provides technical leadership on materials and corrosion. The
    laboratories are limited in their capabilities as related to corrosion
    and most often seek help from the academic community. How does your
    service seek to leverage the expertise in academia and the private
    sector on corrosion prevention and remediation?
        Secretary Fiori. The Army laboratories continually seek
    opportunities to leverage the expertise in academia and the private
    sector through partnering, conferences and joint research efforts.
        Secretary Johnson. By using up to date techniques and processes
    available through Non Government Standard (NGS) organizations, our
    corrosion technical experts leverage academia and private sector
    expertise into Naval working documents. This meets the intent and
    spirit of OMB Circular No. A-119: Federal Participation in the
    Development and Use of Voluntary Consensus Standards and in Conformity
    Assessment Activities. Projects focused on specific corrosion
    preventive efforts also lead to cooperative efforts between the labs
    and academia and private sectors. Many specialized corrosion control
    studies are contracted with the private sector.
        Secretary Gibbs. The Air Force leverages the expertise in academia
    and the private sector through participation in corrosion-related
    industry forums, including the services co-hosting an annual corrosion
    seminar with the National Association of Corrosion Engineer (NACE)
    International. Very often, scholars from academia participate (and are
    featured) in these forums, and it is an excellent means for the Air
    Force to gather information and discuss its corrosion-related issues
    directly with industry.

        29. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, how do your services' efforts relate to those ongoing
    in the other services? Do you see opportunities for further
    collaboration, both within the military community and with those
    outside of it?
        Secretary Fiori. The Army/Army Engineer Research and Development
    Center (ERDC) staff is dynamic in coordinating Tri-Service activities
    through collaboration and participation in the Annual National
    Association of Corrosion Engineers (NACE) Corrosion Conference, Annual
    Tri-Services Corrosion Workshop, and other related Tri-Services
    meetings. The Army is continually seeking improved leveraging
    opportunities for collaboration both within and outside of the military
    community because of funding constraints.
        Secretary Johnson. Navy corrosion technical experts actively
    participate in Tri-Service committees formed to foster communication,
    collaboration, technical training, and technology transfer on
    facilities related maintenance issues between the services, especially
    with regard to corrosion prevention measures. The committees cover
    paints and coatings, LBP (lead based paint), cathodic protection,
    fuels, water, and other areas of concern.
        Their continued participation on non-government committees and
    industry organizations further leads to many cooperative efforts that
    benefit the Department, the Tri-Services in general, and private sector
    applications.
        Secretary Gibbs. The services co-host an annual corrosion seminar
    with the National Association of Corrosion Engineers (NACE)
    International to bring together corrosion personnel from all levels of
    the service's engineering organizations, service laboratories, and the
    private sector corrosion maintenance industry to collect and implement
    guidance on corrosion prevention and maintenance.

        30. Senator Akaka. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, do you seek guidance from your military laboratories
    to solve corrosion issues? If so, do they satisfy your requirements? If
    not, why?
        Secretary Fiori. We look to our laboratories to provide technical
    guidance and support to solve corrosion issues. The laboratories
    satisfy our requirements.
        Secretary Johnson. Yes, military laboratories (NFESC, US Army CERL,
    NRL, etc.) have been and are still consulted to help solve corrosion
    issues.
        Secretary Gibbs. Yes. The Air Force works with the U.S. Army Corps
    of Engineers and the U.S. Navy labs, as well as the Air Force Research
    Laboratory. These relationships meet the Air Force's requirements.

                             HOUSING PRIVATIZATION

        31. Senator Akaka. Mr. DuBois, how much of the basic allowance for
    housing funding in the military personnel accounts for fiscal years
    2002 and 2003 is dedicated specifically to payments related to housing
    privatization?
        Mr. DuBois. In fiscal year 2002, we project approximately $135
    million of the basic allowance for housing funding in the military
    personnel accounts will be used by members to pay rent at housing
    privatization projects. The new impact of privatization in fiscal year
    2002 will be approximately $68.3 million. The $68.3 million reflects
    the number of service members who, prior to privatization of their
    housing, were living on-base or in MILCON housing and not receiving
    BAH, but now are. For those service members who were receiving BAH to
    pay for housing off-post or in the private sector, that impact on the
    BAH account should be transparent as they move into privatized housing.
        In fiscal year 2003, we project approximately $448 million of the
    basic allowance for housing funding in the military personnel accounts
    will be used by members to pay rent at housing privatization projects.

                             UTILITY PRIVATIZATION

        32. Senator Akaka. Mr. DuBois, are the services still being
    directed to complete the privatization of utility systems by the end of
    fiscal year 2003?
        Mr. DuBois. In December 1998, the Deputy Secretary of Defense
    directed the services to privatize all utility systems by September
    2003, except those needed for security reasons or when uneconomical.
        As of October 1, 2001, the services have privatized 26 systems. Two
    hundred five systems were determined to be uneconomical to privatize or
    exempt due to security reasons.
        The program has turned out to be more complex than when initially
    conceived and has taken much longer to implement than anticipated. We
    are currently reviewing the September 2003 completion milestone.
    Meanwhile, the services are proceeding with efforts to execute the
    program.

                            HOMEPORT ASHORE PROGRAM

        33. Senator Akaka. Secretary Johnson, I understand that in the
    Norfolk area barges fitted for berthing are being used to provide
    berthing for sailors in port. What role do you believe such barges
    should play in the homeport ashore program?
        Secretary Johnson. Junior shipboard sailors should have homes
    ashore, just like their more senior or shore based counterparts. The
    use of berthing barges as they relate to the homeport ashore program
    will continue for uninhabitable ships undergoing overhaul when bachelor
    housing space is not available, until more permanent housing can be
    provided.

                 EMERGENCY FUNDING FOR INFRASTRUCTURE PROJECTS

        34. Senator Akaka. Mr. DuBois, Secretary Fiori, Secretary Johnson,
    and Secretary Gibbs, please provide a list of all infrastructure
    projects funded through the Defense Emergency Response Fund using the
    $40 billion appropriated by Public Law 107-38 and the supplemental
    included in Public Law 107-117, to include both military construction
    projects as well as projects involving the improvement of existing
    facilities for purposes including anti-terrorism or force protection.
        Mr. DuBois. The projects funded through the Defense Emergency
    Response Fund and Supplemental are below. There were no defense agency
    projects in these appropriations.

                            [In millions of dollars]
    P.L. 107-38:
      Dover AFB Mortuary.......................................        18.8
      Guantanamo Naval Base Detention Facility (PH I)..........        20.6
      Guantanamo Naval Base Detention Facility (PH II).........        13.4
      Classified Project.......................................        75.0

     P.L. 107-117:
      Thurmont, MD--Road Construction..........................         2.0
      Fort Detrick, MD Anti-Terrorism/Force Protection.........         9.1
      Army classified project in Utah..........................         7.0
      Army classified project..................................         4.6
      Air Force classified projects............................        46.7
      Various locations worldwide--Weapons of mass destruction         35.0
       enhanced security.......................................

        Secretary Fiori. The Defense Emergency Response Fund provided funds
    for infrastructure improvement projects both above and below the $1.5
    million life, health, and safety, threshold for military construction
    funded projects. The Army does not have visibility on access control
    projects below the threshold that were accomplished by installation
    commanders' decisions. The list of known projects follows:

                            [In thousands of dollars]
    ------------------------------------------------------------------------
               State/Location                     Project            Cost
    ------------------------------------------------------------------------
    Active Army
      Maryland
      Fort Detrick......................  AT/FP High Risk              4,950
                                           Facility Hardening.
      Fort Detrick......................  Perimeter Security           1,350
                                           Fence.
      Fort Detrick......................  Remote Delivery              2,800
                                           Facility.

      Utah
      Dugway Proving Ground.............  Classified Project....       7,000

      Inside the U.S.
      Various...........................  Security Measures for       35,000
                                           WMD.

      Outside the U.S.
      Various...........................  Classified Project....       4,600

    Army Reserve
      New Jersey
      Fort Dix..........................  Install Lighting......         120
                                          Install Perimeter            1,050
                                           Fence.

      Pennsylvania
      Oakdale (99th RSC)................  Repair Fence and               190
                                           Install Lighting.

      Wisconsin
      Fort McCoy........................  Install Perimeter            1,050
                                           Fence.
    ------------------------------------------------------------------------

        Secretary Johnson. The following military construction projects
    were funded through the Defense Emergency Response Fund:

                            [In millions of dollars]
      P.L. 107-38:
      Military Construction:
        Guantanamo Bay Cuba--Detainee Facility I...............        20.6
        Guantanamo Bay Cuba--Detainee Facility II..............        13.4
      P.L. 107-117:
      Military Construction:
        Thurmont, MD--Road Construction........................         2.O

        Funding totaling $75.3 million from P.L. 107-38 was used to
    increase the security posture at various installations. Anti-terrorism
    force protection projects at these installations included fencing,
    perimeter lighting, gate houses, concrete barriers, intrusion detection
    systems, waterside security, flight-line barriers, pop-up gate
    barriers, installation of window film, and building hardening.
        Secretary Gibbs. A list of Air Force infrastructure projects funded
    with the $40 billion Fiscal Year 2002 Defense Emergency Response Fund
    follows:

                                     ______

                   Questions Submitted by Senator Mark Dayton

                      ENERGY SAVINGS PERFORMANCE CONTRACTS

        35. Senator Dayton. Secretary Gibbs, I understand that the Air
    Force currently has six regional energy savings performance contracts
    in place covering Air Force facilities throughout the United States. I
    have been told that some of these contracts are now approaching their
    ceiling prices, and that the Air Force does not plan to perform any
    more work under these contracts until they can be recompeted, a process
    that could take a year or more. Do you support the use of energy
    savings performance contracts to make Air Force facilities more energy-
    efficient and reduce the Department's energy costs?
        Secretary Gibbs. Yes, the Air Force supports the use of energy
    savings performance contracts as one of the primary tools it has to
    identify and implement energy saving measures. The Air Force has
    engaged in the use of these contracts in each of its six regions,
    awarding over $250 million to date in task orders funded by the
    respective Energy Service Companies (ESCOs) against these six
    contracts. The Air Force reimburses the ESCO up front cost over time
    from annual energy cost savings associated with each task order. The
    Air Force plans to continue the use of these six contracts and is
    currently considering an additional $350 million in task orders
    identified by the ESCOs.

        36. Senator Dayton. Secretary Gibbs, do you believe that it would
    be appropriate to raise the ceiling prices on existing contracts to the
    extent necessary to avoid a gap in performance during the period in
    which these contracts are being recompeted?
        Secretary Gibbs. Currently, the Air Force does not anticipate any
    gap in awarding new energy saving measures. The existing contracts are
    approximately 4 years old, and each has a term of 25 years. The Air
    Force is in the process of procuring a new contract in one region where
    the awards to the ESCO have reached 80 percent of the original $250
    million ceiling available for that region. That new contract should be
    in place by the end of this fiscal year. However, the Air Force does
    not anticipate reaching the ceiling on that contract or in any other
    region before a new contract has been awarded.

        37. Senator Dayton. Secretary Gibbs, will you review the Air
    Force's current contracting effort and report on the extent to which
    this contracting mechanism is or is not being used today?
        Secretary Gibbs. I have reviewed the current Air Force effort. The
    Air Force has pursued energy savings performance contracting and to
    date has approved and implemented more than $250 million in energy
    saving performance task orders funded up front by the ESCO, and
    reimbursed over time from Air Force energy cost savings. In addition,
    the Air Force is currently considering contractor proposals for another
    nearly $350 million in task orders across the six regions.

        38. Senator Dayton. Secretary Fiori, I understand that the Army
    currently has two energy savings performance contracts covering Army
    facilities throughout the United States. I have been told that the Army
    has stopped placing work orders under these contracts. Do you support
    the use of energy savings performance contracts to make Army facilities
    more energy-efficient and reduce the Department of Defense's energy
    costs?
        Secretary Fiori. The U.S. Army Corps of Engineers, Huntsville
    Center, awarded two sets of energy savings performance contracts
    covering Army facilities throughout the United States for a total of
    eighteen contracts. In addition, the Army Medical Command awarded nine
    contracts for use in its medical facilities, and the U.S. Army Corps of
    Engineers, European District, has awarded several contracts for use in
    Europe. Army installations are also using Department of Energy
    contracts at some locations. All of these contracts permit the
    contractor to develop multiple energy saving projects.
        We have not stopped placing work orders against any of these
    contracts. We have suspended the use of energy savings performance
    contracts in Army family housing units that are part of the Army's
    Residential Communities Initiative effort due to some extremely complex
    coordination issues.

        39. Senator Dayton. Secretary Fiori, will you review the Army's
    current contracting effort and report on the extent to which this
    contracting mechanism is or is not being used today?
        Secretary Fiori. The Army is using energy savings performance
    contracts extensively. The Army awarded 23 projects in fiscal year 2000
    with an investment value of $107 million and 15 projects in fiscal year
    2001 with an investment value of $135 million. So far in fiscal year
    2002, we have awarded three projects with an investment value of over
    $12 million.

        40. Senator Dayton. Secretary Fiori, does the Army have adequate
    resources to manage and administer these programs?
        Secretary Fiori. Yes.

        41. Senator Dayton. Secretary Fiori, is there a funding shortfall
    in terms of managing this effort?
        Secretary Fiori. No.

        42. Senator Dayton. Secretary Fiori, could the Army execute more
    energy savings performance contracts with additional administrative
    support?
        Secretary Fiori. No. New technology and renewable energy projects
    are often not cost effective under energy savings performance contracts
    and cannot be accomplished. Direct funding to reduce the private sector
    investment will increase the use of renewable energy sources.

        43. Senator Dayton. Secretary Gibbs and Secretary Fiori, how much
    has been saved by energy savings performance contracts since the
    inception of the program?
        Secretary Gibbs. Because of the structure of the contracts and the
    timeframes involved, it is difficult to quantify savings at this point.
    Each awarded task order is funded up front by the ESCO who is
    reimbursed by the Air Force over time according to the specific annual
    energy savings identified in the task order. Payback periods may range
    from 1 to 25 years. After the task order is reimbursed, continuing
    savings revert to the Air Force, and will accumulate indefinitely after
    payback. To date, the Air Force has awarded $250 million in task
    orders, all of which will be reimbursed to the ESCO by 2023, and
    contribute to Air Force savings.
        Secretary Fiori. Since the inception of the program in 1996, the
    Army has awarded 85 projects with over $400 million in investment at
    our installations. These projects are expected to reduce energy
    consumption by 3 million MBTUs of energy (approximately equal to 20
    million gallons of oil) each year. Virtually all the dollars saved are
    used to pay for the private sector investment.

        44. Senator Dayton. Secretary Gibbs and Secretary Fiori, could
    additional savings be generated? If so, how much?
        Secretary Gibbs. The Air Force works with the ESCOs to identify
    additional savings opportunities. Good ideas are cross-fed across
    installations and regions to take advantage of successful projects.
    While the ESCOs continue to identify additional savings opportunities,
    the future unidentified potential cannot be quantified.
        Secretary Fiori. Most of our installations have executed projects
    using energy savings performance contracts. We expect to award an
    additional $200-$250 million in projects over the next 5 years, with an
    estimated savings of 1.5 million MBTUs of energy (approximately equal
    to 10 million gallons of oil per year).
                                     ______

                   Questions Submitted by Senator John McCain

                                 BASE TRANSFERS

        45. Senator McCain. Mr. Dubois, in a letter on January 16, 2002, I
    raised the fact that the David W. Taylor Research Center in Annapolis,
    Maryland, selected for closure in 1995, had not yet been transferred to
    the local reuse authority. Secretary Aldridge responded on February 19,
    2002 suggesting, ``a pending court decision regarding a private
    citizen's lawsuit'' was the ``critical issue'' holding up the transfer.
    Department of Defense officials have since informed my staff that this
    lawsuit is not relevant to the Navy's transfer of the David W. Taylor
    Research Center. Are you now of the understanding that the process to
    fully close the David W. Taylor Research Center and transfer the
    property to the local reuse authority will move forward expeditiously?
    Please provide me with a timetable for the transfer of this property.
        Mr. DuBois. The referenced civil suit, while one of several local
    issues, is not delaying Anne Arundel County from accepting title to the
    property. Rather, the County Executive cannot close on the David Taylor
    transfer documents without authorization from the County Council. This
    local authorization requires agreement between the master developer,
    the County, and the Navy. Most provisions necessary for the local
    legislative process to proceed have been ironed out and the County
    expects property settlement and transfer by September 30, 2002.

        46. Senator McCain. Mr. Dubois, what steps is the Department of
    Defense taking to review the caseload of bases awaiting final transfer
    and what resources have been devoted to ensure this effort happens in a
    timely manner?
        Mr. DuBois. I have directed the military services to identify
    impediments to transfer, and to propose remedies at all BRAC sites with
    some outstanding property. I will routinely review the progress we are
    making in the transfer of these properties with the military services
    and seek remedies to any impediments as they are encountered. This
    review will include the development of an updated transfer schedule for
    each installation, and validation of budgets to ensure adequate
    resources are dedicated to these efforts. Each military service is
    responsible for the disposition of this property and it is within each
    service that the preponderance of resources are being expended to
    facilitate the remaining transfers.
        Among the actions OSD is undertaking include:

             A complete review of the environmental programs
            presently underway for time/cost-saving opportunities;
             A review of sites where transfers appear to be impeded
            due to the community reluctance to accept transfer, or the
            consideration of alternative transfer options; and
             Direct the military services to review their existing
            procedures to ensure the timely preparation of transfer
            documents and funding of necessary actions to facilitate
            transfer.

        It should be recognized that not all property can be transferred
    since there are some installations at which ongoing DOD missions after
    BRAC will delay property transfer for several years, e.g. chemical
    demilitarization operations at Pueblo and Umatilla Army Depots, and a
    Missile Defense Agency mission at Ft. Wingate.
                                     ______

                 Questions Submitted by Senator James M. Inhofe

                           DOD RECAPITALIZATION RATE

        47. Senator Inhofe. Mr. DuBois, last year you announced with great
    enthusiasm the Department of Defense's 67-year recapitalization cycle.
    Congress provided a level of funding to support an 83-year cycle. This
    year's request funds a 121-year cycle. What funding levels are required
    to achieve the 67-year cycle and when do you intend to provide the
    funds to support this goal?
        Mr. DuBois. In fiscal year 2003 dollars, and given our current
    inventory forecast, we need about $6.4 billion annually in restoration
    and modernization funding, using a combination of military construction
    and operations and maintenance funds, to achieve a 67-year rate. In
    addition, we have to fund full sustainment levels in the O&M accounts,
    or the facilities will not last the required 67 years on average. The
    fiscal year 2003 President's budget includes funds to achieve the 67-
    year recapitalization cycle by fiscal year 2006 or fiscal year 2007
    depending on the inventory that remains at that time. Sustainment
    levels improve and reach 97 percent in fiscal year 2007.

        48. Senator Inhofe. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, assuming there is no increase in military
    construction, sustainment, restoration, or modernization funding over
    the fiscal year 2003 request, what is a realistic goal for achieving
    the 67-year recapitalization goal?
        Secretary Fiori. The current funding level in 2003 reflects a
    recapitalization rate of 123 years. We have programmed additional
    funding in the FYDP and are on track to reaching the 67-year cycle by
    2010.
        Secretary Johnson. Attainment of the 67-year recapitalization rate
    is predicated on increased funding programmed in FYDP. However, given
    the uncertainty presented by BRAC 2005, which would eliminate the need
    to recapitulate some unknown fraction of the DON infrastructure, it
    would be conjecture to estimate an alternate timeframe. The DON
    recapitalization rate included in the fiscal year 2003 President budget
    is 122 years.
        Secretary Gibbs. Based upon the present fiscal plan, the Air Force
    reaches the 67-year recapitalization rate goal in fiscal year 2007.
    However, competing fiscal priorities and the need to balance
    sustainment of existing infrastructure with the need for new
    construction may impact that schedule.

                         OVERSEAS MILITARY CONSTRUCTION

        49. Senator Inhofe. Mr. DuBois, last month I traveled to Germany
    and received a briefing on the Efficient Basing East Program. I
    understand that our forces in Korea through the Land Partnership Plan
    have a similar effort to reduce the number of installations from 41 to
    21. Although I support these efforts since they benefit our forces and
    reduce cost, these plans are also a benefit to the host nations. What
    are Korea and Germany doing to support these efforts?
        Mr. DuBois. At this point, German reaction to the Efficient Basing
    East (EBE) initiative is unknown, since the U.S. Embassy in Berlin just
    began host nation consultations with the Federal Republic of Germany
    (FRG). It is possible that the affected states within Germany may have
    different reactions--the losing state may be concerned about job
    losses, while the gaining state may react very positively. The FRG has
    the opportunity to raise any concerns during the host nation
    consultation process. After consultations are completed, the Secretary
    of Defense will make the final decision on the complete return of 12
    installations and the partial return of one installation. Assuming he
    decides to return the affected installations, the Department plans to
    accomplish certain construction projects supporting EBE through
    payment-in-kind compensation provided by the Germans as reimbursement
    for U.S.-funded improvements on returned facilities.
        The Land Partnership Plan reflects substantial support from the
    Republic of Korea. Of the entire Land Partnership Plan cost, only 13
    percent ($297.6 million) will come from the United States through
    already programmed military construction projects. The remaining 87
    percent ($1.07 billion) will be paid from Republic of Korea funded
    construction, and additional host nation funding produced by sales of
    returned, high value land.

        50. Senator Inhofe. Mr. DuBois, what are your plans for expansions
    and/or reductions to the infrastructure in Southwest Asia?
        Mr. DuBois. The combatant commanders are currently assessing their
    overseas basing structure. The study will be provided to Congress when
    it is completed.

        51. Senator Inhofe. Mr. DuBois, what support is the United States
    getting to maintain or build new facilities from the various countries
    in the region?
        Mr. DuBois. The current level of support provided by each country
    is outlined in the Status of Forces Agreements and burdensharing
    agreements applicable to that country. The burdensharing report will be
    published soon, and we are exploring additional opportunities to
    increase burdensharing by our Allies.

                                  F-22 BEDDOWN

        52. Senator Inhofe. Secretary Gibbs, the Air Force is requesting
    $42.8 million for the beddown of the F-22. This is a follow-on to $54
    million appropriated last year. How much additional funding will be
    required to provide for the beddown of the F-22 and how much of your
    budget is dedicated to new mission programs?
        Secretary Gibbs. Based on the current F-22 production schedule, an
    additional $36.9 million in fiscal year 2004, $43.2 million in fiscal
    year 2005, $60.1 million in fiscal year 2006, $96 million in fiscal
    year 2007, $83.5 million in fiscal year 2008, and $16.4 million in
    fiscal year 2009 is required to beddown the F-22. This allows unique F-
    22 facility requirements to be met at all beddown locations.

                         EFFICIENT BASING EAST PROGRAM

        53. Senator Inhofe. Secretary Fiori, during my last visit to
    Germany, I received a briefing on the Army's Efficient Basing, East,
    Program. Although I support the plan, I understand that the $350
    million cost has risen significantly. What is the projected cost for
    moving the Brigade Combat Team and their families to Grafenwoehr,
    Germany? What are the efficiencies you expect from this relocation?
        Secretary Fiori. The total construction cost is estimated at
    approximately $695 million. This cost is comprised of military
    construction, Army (MCA) of $596 million and military construction,
    Defense-Wide of $100 million for non-Army construction (DODEA, DECA,
    AAFES, and Defense Medical). There has been no increase in the cost of
    this program.
        The initiative is necessary and efficient. Efficient Basing, East
    consolidates a heavy Brigade Combat Team from 13 small, scattered
    installations to a single installation. It is good for soldiers, it
    will improve operations and training, and it saves money. Soldiers will
    be located next to their major training area, work in facilities built
    to support their job most efficiently, and housed in modern barracks
    and family housing, properly sized and outfitted to today's standards.
    This initiative saves money because, in the long run, it is cheaper to
    build new in a single location than rehabilitate and refurbish old
    outmoded facilities in a dispersed World War II footprint.

                           PRIVATIZATION OF BARRACKS

        54. Senator Inhofe. Secretary Johnson, I understand that the Navy
    is considering the privatization of barracks to meet its goal of
    providing dormitory space to shipboard sailors. What is the incentive
    behind your program, especially when earlier attempts to privatize
    barracks were rejected?
        Secretary Johnson. It will be a number of years before we are able
    to address our critical bachelor housing needs through traditional
    military construction funding. Based on our successful experience with
    family housing privatization, we believe there is a potential to
    similar leverage our resources to improve living conditions for single
    sailors and marines much faster. Although there are unique challenges
    posed by bachelor housing, such as extended deployments, we are
    developing pilot projects that, we believe, will address these issues
    and remain compatible with service operational objectives such as unit
    cohesion and team building.

                      ANTI-TERRORISM AND FORCE PROTECTION

        55. Senator Inhofe. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, although anti-terrorism and force protection measures
    have been on the forefront for some time, the tragic events of
    September 11 dramatically demonstrated the need to provide additional
    protection to our military installations. Although protective measures
    are important, the greatest defense measure is standoff distance from
    the surrounding community. In the past we have discussed the impact of
    encroachment on our training environment. What is the impact of
    encroachment on our ability to protect our installations? What are we
    doing to resolve this matter?
        Secretary Fiori. There are Army installations where the
    encroachment of the civilian community on the installation's perimeter
    is unavoidable. The impact of encroachment creates challenges for
    installation commanders, and requires a balance between community
    development and force protection. Each installation commander performs
    a risk analysis to make effective decisions on force protection and the
    impact on the installation and the surrounding communities. The Army,
    working with the local community leaders and boards, can achieve a
    balance with community development and force protection.
        Currently, revised standards for minimum standoff distances are
    being written and will apply to all new and existing structures. Where
    those distances are not available, the structure will be analyzed by an
    engineer experienced in blast-resistant design and hardened as
    necessary.
        In addition, open communication, community interaction, and a
    thorough information campaign assist in protecting and reassuring both
    the installation and the community on security issues. The key to this
    is the involvement of public affairs officers and liaison activities
    with leaders in local government, public agencies, civic organizations,
    and the local public media.
        Secretary Johnson. Just as encroachment at training ranges impacts
    our process for assuring combat readiness, encroachment on our
    installations contributes to a myriad of security challenges for Navy/
    Marine Corps installations and can compromise the security of our
    civilian and military personnel. Inadequate standoff distance around
    our installations associated with encroachment has several impacts
    including: inadequate setback for blast protection; compressed security
    force response time; opportunities for close surveillance of military
    operations by adversaries; communications challenges as civilian use of
    the frequency spectrum competes with military training, security, and
    communications requirements; and increased threat to flight and other
    military operations. September 11, also highlighted the accessibility
    of our installations from threats from the air, the sea, and through
    various existing easements, highways, and railroads that pass through
    our installations (e.g. I-5 at Camp Pendleton).
        Every installation has increased its security posture since the
    attacks of September 11, 2001. Additional security personnel,
    technology (security systems and detection devices), security fencing,
    barriers, security boats, and training are all being provide to enhance
    our antiterrorism/force protection (AT/FP) posture. The military
    construction (MILCON) projects in the fiscal year 2003 budget request
    have incorporated AT/FP measures within the scope of the project. These
    measure include standoff distances, shatter resistant windows,
    structural reinforcement, and building hardening. There is
    approximately $107 million in Navy MILCON projects to support this
    objective.

                            [In thousands of dollars]
    ------------------------------------------------------------------------
                AT/FP                Project
    ------------------------------------------------------------------------
    EGLIN AFB FL NAVSCLEO.......          903   ADV EXPL ORD           6,350
                                                 DISP TRAINING
                                                 FAC.
    BAHRAINNAVSUPPACT...........          911   INSTALLATIONSVC       25,970
                                                 SUPTCNTR.
    NORFOLK VA NS...............          469   SHORELINE              2,O30
                                                 SECURITY
                                                 FENCING.
    SIGONELLA ITALY NAS.........          625   PARKING GARAGE.       19,560
    KITTERY ME PORTSMOUTH NSY...          904   AT/FP                 11,600
                                                 IMPROVEMENTS.
    PORTSMOUTH VA NORFOLK NSY...          902   AT/FP                 19,660
                                                 IMPROVEMENTS.
    PUGET SOUND WA BREMERTON NSY          903   AT/FP                 21,670
                                                 IMPROVEMENTS.
                                                                ------------
      Total.....................                                     106,840
    ------------------------------------------------------------------------

        In addition to the above projects that specifically address AT/FP
    enhancements and/or improvements, each of our MILCON projects has AT/FP
    construction features (appropriate to the type and function of the
    project). These features account for $17.5 million or approximately 3
    percent of the projects requested in the fiscal year 2003 Navy MILCON
    program.
        DON is also exploring various land use controls measures that may
    assist in restricting development of lands surrounding our
    installations from uses that are incompatible with military
    requirements. Initiatives such as the Joint Land Use Study (JLUS)
    program, an initiative sponsored by the Office of Economic Adjustment
    and Air Installations Compatible Use Zones can facilitate joint
    planning between DOD and local communities to protect military
    operations and public safety.
        Secretary Gibbs. To date, urban encroachment has not been an issue
    impacting the Air Force's ability to protect its installations.
        The objective of the Air Force anti-terrorism program is to reduce
    the vulnerability of personnel and facilities while balancing defensive
    measures with mission requirements and available resources. The Air
    force goal is not to fortify the installation, but make it a less
    attractive target. This is achieved by incorporating flexible and
    common sense protection through appropriate base development planning.
    As the Air Force works to enhance its urban encroachment program, asset
    and force protection will be one of many issues that it addresses.

                     MAINTENANCE AND PRODUCTION FACILITIES

        56. Senator Inhofe. Secretary Gibbs, at virtually every hearing,
    the service chiefs testify that the aging equipment in our military is
    impacting readiness due to heavy maintenance requirements. I was
    therefore surprised to see that funding for maintenance and production
    facilities in the Department of Defense's request was down almost 60
    percent from the National Defense Authorization Act for Fiscal Year
    2002. The Air Force's request is down almost 80 percent from last year.
    How does the Air Force intend to provide adequate maintenance and depot
    support at these funding levels?
        Secretary Gibbs. The year-to-year distribution of facilities
    funding varies by facilities categories. The Air Force does not budget
    to maintain a level investment for each facility category. It budgets
    with a wider viewpoint--while the military construction request for
    maintenance and production facilities is lower this year, the
    sustainment budget for all Air Force facilities has been increased from
    fiscal year 2002 to fiscal year 2003.
        The Air Force is requesting over $4.2 billion in total to invest in
    Air Force facilities and infrastructure in fiscal year 2003, the same
    level as submitted in the fiscal year 2002 budget request. The Air
    Force's focus in fiscal year 2003 will be to sustain the facilities
    that already exist, investing nearly $2 billion for sustainment,
    restoration, and modernization, an increase of over $360 million from
    fiscal year 2002.

                              REPAIR OF FACILITIES

        57. Senator Inhofe. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, I have a special interest in the training of our
    military personnel and take a special interest in operation and
    maintenance (O&M) funding. Last year, your services reported that you
    allocated more that $370 million for 31 building repair projects. That
    number reflects only those projects costing more than $7.5 million. I
    am concerned that you are using training dollars to support the
    military construction (MILCON) program. What criteria are you using to
    decide whether or not a project should be funded using MILCON or O&M?
    What is the source of the O&M funding you are using for these projects?
        Secretary Fiori. The Army appropriately uses O&M funds to repair
    facilities that require immediate attention, overhauling or replacing
    failed or failing components or materials. The condition of these
    facilities must be addressed quickly to prevent accelerated
    deterioration and potential unsafe conditions and cannot wait for long-
    term MILCON programming to correct. The use of O&M funds for repair
    projects may include some associated minor construction that may not
    exceed a new cost limitation of $750,000. If this minor construction
    corrects a deficiency that is life, health, or safety threatening, then
    the cost limitation for associated construction is $1.5 million. Any
    repair project that has associated minor construction that exceeds
    these cost limitations must be considered and programmed for either
    Unspecified Minor Military Construction, Army (UMMCA), or Military
    Construction, Army (MCA). Repair projects exceeding a total cost of
    $7.5 million are reported to Congress.
        The Army distributes O&M funds to the Major Army Commands (MACOMs),
    who in turn, distribute to the installations. Amounts for these funds
    are specified for use in training, operational costs, and for
    sustainment, restoration, and maintenance costs.
        Secretary Johnson. The Department does not use funds programmed for
    military personnel training to repair buildings or construct new
    buildings. Title 10 U.S.C. Chapter 169 provides the criteria to
    determine if a project should be MILCON funded. The Navy and Marine
    Corps have implementing guidance on O&M funded repair and minor
    construction projects, OPNAVINST 11010.20F and MCO P11000.5. O&M funds
    are requested in the budget for sustainment, restoration, and
    modernization (SRM). These funds are programmed for repair of real
    property facilities.
        Secretary Gibbs. To sustain, restore, and modernize its
    infrastructure, the Air Force must achieve a balance between military
    construction and operations and maintenance programs. Military
    construction restores and re-capitalizes facilities. Operation and
    maintenance funding ensures the Air Force can perform facility
    sustainment activities, without which facilities would fail
    prematurely. Operation and maintenance funding is also used to directly
    address many of the critical restoration and less-expensive
    recapitalization needs. Without these funds, commanders in the field
    are unable to address facility requirements that impact their near-term
    readiness.
        When the Air Force builds its annual budget request, it projects
    the requirement for operations and maintenance and program funds in the
    O&M facility sustainment, restoration, and modernization line. Once
    appropriated by Congress, these are the funds we use to address our O&M
    facility repair requirements.

                          FAMILY HOUSING PRIVATIZATION

        58. Senator Inhofe. Mr. DuBois, the Department of Defense plans to
    privatize about 100,000 family housing units over the next several
    years. Based on the latest report, which reflects data since 1996, the
    Department of Defense has less that 30,000 units awarded or pending
    award. Although this is a major improvement over the fiscal year 2001
    report, there is still a great deal of work ahead to achieve the
    100,000 goal. Are you satisfied that each service now has a housing
    privatization program that will support the Department of Defense's
    privatization goals?
        Mr. DuBois. The Secretary of Defense accelerated the Department's
    goal for eliminating inadequate housing (which totals about 168,000
    units) from 2010 to 2007. At this point, all the services, with the
    exception of the Air Force, met the 2007 goal (Air Force is now using
    2010). Accordingly, we are accelerating housing privatization, but
    working to implement this program in a manner that ensures high quality
    construction and operation of military family housing.
        As I noted in my testimony before the House Appropriation
    Committee, Subcommittee on Military Construction on March 13, 2002
    regarding the DOD housing privatization program, we awarded 10 projects
    in 5 years (fiscal year 1996-2001), producing about 7,000 privatization
    units. Only 1 year later, we have awarded a cumulative total of 16
    projects (7 Navy, 1 Marine, 4 Air Force, and 4 Army) producing about
    25,000 privatized units. The six privatization projects awarded over
    the last year more than tripled the number of units already privatized.
        Through the experience of creating, awarding, and executing the
    first 16 Military Housing Privatization Initiative projects, the
    services have developed internal expertise and capacity in disciplines
    important to housing privatization. Each service now has experienced
    privatization teams in-place with expertise in project management,
    acquisition, financial management, personnel, legal, and real estate/
    housing management. This expertise can be found at the installation,
    command, and headquarters levels of each service. I believe the program
    has momentum, and service project privatization plans are moving
    forward to achieve our 2007 goal. Assuming our congressional support
    and funding remain stable the Department will: privatize 35,000 units
    in fiscal year 2003; award a cumulative total of 60,000 units
    privatized by the end of fiscal year 2003; and continue that
    acceleration through fiscal year 2004-2007.

                       CHEMICAL DEMILITARIZATION PROGRAM

        59. Senator Inhofe. Secretary Fiori, Congress has appropriated $1.3
    billion for the construction of chemical demilitarization facilities.
    This year, the Army budget includes an additional $167 million. What
    have the taxpayers received for this huge investment?
        Secretary Fiori. The military construction funds financed design
    and construction of large scale industrial disposal facilities, depot
    infrastructure support projects, and a training facility. Funds have
    been used to design and construct the Tooele, Umatilla, and Anniston
    Chemical Agent Disposal Facilities. Funds have also been used to design
    and continue construction at Pine Bluff, Aberdeen, and the Newport
    Chemical Agent Disposal Facilities. In addition, military construction
    funds are used at each of the sites to construct depot infrastructure
    upgrades that are required to support the chemical agent disposal
    facilities such as utility and road upgrades. A training facility was
    also built to support to chemical demilitarization destruction program.
        Construction at Tooele was completed in 1993, and the facility is
    now in agent operations. To date, Tooele has destroyed 44 percent of
    the chemical agent and 81 percent of the munitions stored at the
    Deseret Chemical Depot. In addition, Johnston Island has completed 100
    percent destruction of all the chemical munitions stockpile stored on
    the island and is in the closure process. Construction at Anniston and
    Umatilla was completed in 2001, and these two facilities are currently
    in the systemization-testing phase with planned disposal operations to
    start in fiscal year 2003. Construction is currently ongoing at Pine
    Bluff (83 percent complete), Aberdeen (25 percent complete), and
    Newport (26 percent complete). The Aberdeen, MD, facility has
    accelerated the neutralization process by as much as 2 years for
    disposal of mustard bulk agent. The Army is evaluating a similar option
    to accelerate disposal of the bulk VX nerve agent stockpile at Newport,
    IN, and will continue to evaluate options at other sites. As permitted
    by law, depot upgrade contracts that are technology neutral have also
    been started at Pueblo Chemical Depot and Blue Grass Army Depot to
    support the planned chemical disposal facilities at those locations.
    The training facility in Edgewood, MD, was completed in 1991 and is
    used to provide initial and refresher training of systems contractor
    personnel in a hands-on replica of a functioning disposal facility.
        The Non-Stockpile Product is continuing construction of the
    Munitions Assessment and Processing System at Aberdeen, MD, which will
    be used to destroy recovered munitions.

        60. Senator Inhofe. Secretary Fiori, how much additional military
    construction funding is programmed to complete facilities?
        Secretary Fiori. In addition to the $167 million programmed for
    fiscal year 2003, a total of $537.5 million is also programmed in
    fiscal year 2004 ($187.7 million), fiscal year 2005 ($180.5 million),
    fiscal year 2006 ($115.6 million), and fiscal year 2007 ($53.7
    million). These funds are to complete the construction at Newport
    ($88.0 million) and to fully fund the construction of the disposal
    facilities at Pueblo ($201.3 million) and Blue Grass ($248.2 million).
    Start of construction at Pueblo and Blue Grass disposal facilities will
    begin once process technology decisions are made and Resource
    Conservation and Recovery Action (RCRA) permits are approved. A
    technology decision for Pueblo is planned for the third quarter fiscal
    year 2002 and Blue Grass is planned for the first quarter fiscal year
    2003.

        61. Senator Inhofe. Secretary Fiori, will the Army meet the 2007
    treaty-imposed deadline to destroy the unitary chemical stockpile?
        Secretary Fiori. The Army is exploring all viable options to safely
    destroy the chemical stockpile at the earliest possible date. The
    Office of the Secretary of Defense (OSD) has completed a major program
    review (September 2001) that resulted in the recognition that the
    existing stockpile destruction milestones would not be met. The largest
    contributor to this is the incorporation of our chemical agent
    destruction experience at Johnston Island and at Tooele, Utah, into
    realistic forecasts for other disposal sites.
        The Army is accelerating the effort to neutralize the chemical
    agent stockpile at Aberdeen Proving Ground, MD, and is studying the
    feasibility of a similar effort at Newport, IN, and will evaluate
    similar options at other sites. Using the accelerated neutralization
    process, the Army will eliminate these two stockpiles before the treaty
    deadline.
        The Non-Stockpile Product Program continues to execute the disposal
    of the U.S. chemical warfare materiel that is not part of the unitary
    chemical stockpile, in compliance with the Chemical Weapons Convention
    (CWC). The non-stockpile program is on schedule to meet the 80 percent
    CWC deadline (April 2005), and the 100 percent CWC deadline (April
    2007) for the destruction of Schedule 1 Chemical Weapons Production
    Facilities.

                             GUAM ELEMENTARY SCHOOL

        62. Senator Inhofe. Mr. DuBois, due to the inadequacy of Guam's
    education system, the Department of Defense directed the Department of
    Defense Education Agency (DODEA) to establish a school system on
    Anderson Air Force Base and Naval Station Guam. Congress supported the
    decision by authorizing funding to provide interim facilities. However,
    it was agreed that the Department of Defense would include funding in
    future budgets to build new facilities. To date only the middle school
    at Anderson Air Force Base has been completed. I understand that
    funding for the construction of the new high school is in the Future
    Year Defense Program, but nothing has been programmed for the Navy
    middle school. I understand that the condition of the Navy middle
    school is deplorable and that it is not compliant with the Americans
    with Disabilities Act. The Navy's decision to homeport new ships in
    Guam will only aggravate the situation and cause further hardship on
    the students and faculty. Since this is a critical quality-of-life
    issue, when will the Department of Defense provide the funding to DODEA
    for the construction of the Navy middle school?
        Mr. DuBois. The Department of Defense is examining all restationing
    efforts, to include the Guam restationing. The Guam Elementary/Middle
    School is a priority and will be reprioritized to meet the educational
    needs of our students. The construction of a new middle school is
    needed with or without the influx of population from the restationing
    effort.

                         DEFENSE IMPACT REVIEW PROCESS

        63. Senator Inhofe. Mr. Dubois, Section 1041 of the National
    Defense Authorization Act for Fiscal Year 2002 directs the Secretary of
    Defense to prepare a report to the President and Congress on the need
    for a Defense Impact Review Process. This process would provide the
    Department of Defense with the opportunity to review the proposed
    actions of other Federal agencies in order to identify those actions
    that may have an adverse impact on national defense. This report is due
    June 2002. How will the Section 1041 Defense Impact Review Process be
    beneficial for the Department of Defense in addressing encroachment
    issues? Has the Department started preparing the report? Will it be
    here on time?
        Mr. DuBois. Secretary Mayberry and I are directing the effort to
    prepare the Section 1041 Report and that effort has begun. We do
    believe that action agencies should be required to consider military
    readiness impacts during any regulatory or administrative process that
    may result in an action that has the potential to affect military
    testing, training, or operations. Action agencies could be required to
    prepare formal ``defense impact analyses,'' much as they routinely
    prepare environmental impact analyses today. Other mechanisms under
    consideration that would be beneficial ensure that DOD is given: (1)
    advance notice of proposed agency actions that have the potential to
    affect military testing, training, or operations; (2) a reasonable
    opportunity to bring DOD's concerns, if any, to the action agency's
    attention; (3) assurance that DOD's readiness concerns will be given
    appropriate consideration; and (4) an opportunity for DOD to raise its
    concerns within the Executive Office of the President should the action
    agency decide it must act notwithstanding DOD's concerns. The
    Department will submit its report in June 2002.

        64. Senator Inhofe. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, it is expected that the input of the military
    departments will be a critical aspect of the review process and report
    preparation. What role has the military departments played in the
    Defense Impact Review Process? Do you anticipate that this process will
    help to address your departments' environmental encroachment concerns
    in a substantive manner?
        Secretary Fiori. The Army has actively participated with the Office
    of the Secretary of Defense and our sister services in the development
    of the Secretary of Defense's recommendation to the President. The Army
    is evaluating the probable benefits of a formalized National Defense
    Impact Review Process against the potential costs and administrative
    burden that such a process may create.
        Federal agencies sometimes take actions, particularly at the local
    and regional level, without adequate consideration of the effects those
    actions will have on national defense. These actions often affect or
    have the potential to affect our ability to train soldiers and ensure
    military readiness. In large part this is due to the fact that there is
    no process through which we can ensure national defense concerns are
    identified and considered, and the appropriate balance between defense
    and other important national policies is achieved. The Army believes
    that such a process should consist of five critical elements:
    notification of proposed agency actions, reasonable opportunity for DOD
    to comment, consideration of Defense Department views, consultation to
    resolve disagreements, and submission of an annual report to OMB.
        Secretary Johnson. The Office of the Secretary of Defense asked
    each military department to report on the impact of federal regulatory
    and administrative actions on defense activities consistent with the
    requirements of Section 1041 of the Fiscal Year 2002 National Defense
    Authorization Act. The Department of Navy tasked the Navy and Marine
    Corps to survey their bases and provide specific examples of how
    military activities were being impacted or restricted by other federal
    actions. The services reviewed their files and documented specific
    cases where the services had raised concerns about the potential impact
    of federal regulatory actions on military readiness but those concerns
    were not addressed by the acting agency. In the Department of Navy's
    response to the Department of Defense, we will provide a summary of the
    examples that we have found and recommendations on how best to address
    military needs in the regulatory process.
        The Defense Impact Review Process provides an important vehicle for
    addressing regulatory impacts on military readiness. Based on this
    review, DOD will recommend needed changes in the process to help ensure
    military readiness is given appropriate consideration in the federal
    regulatory process.
        Secretary Gibbs. OSD has requested, and the Air Force has provided,
    examples of encroachment related to other Federal agency actions for
    OSD's report to Congress. The Defense Impact Review Process can assist
    the Administration in minimizing gaps in interagency cooperation to
    prevent potential mission impacts.
        Currently, the Air Force's only formal means of addressing impacts
    is as a cooperating agency under the National Environmental Policy Act
    (NEPA) when other Federal agencies perform environmental impact
    analyses. Generally, other agencies do not request military departments
    to be a cooperating agency; therefore this tool is not always used
    effectively.
        When not a formal cooperating agency, the Air Force provides
    comments and input on potential readiness issues on an ad hoc basis.
    The Air Force reviews environmental analyses for other agency's
    proposals when provided the opportunity; when the Air Force identifies
    other agency proposals via the Federal Register; or when other agencies
    provide copies of their environmental documentation as a matter of
    routine (not necessarily an active engagement). These efforts often
    fail to identify readiness impacts as an issue, thus the Defense Impact
    Review Process can be of significant benefit.

                            ALTERNATIVES TO VIEQUES

        65. Senator Inhofe. Secretary Johnson, in his March 20, 2001,
    testimony before the Readiness and Management Support Subcommittee,
    Vice Admiral James F. Amerault stated, ``Encroachment is a serious
    problem--we are finding it increasingly difficult to train our sailors
    effectively at other locations due to overly broad legal requirements--
    we are witnessing a loss of training realism. . . .'' Given the Navy's
    expressed intent to find equivalent training facilities to replace
    Vieques, how do you propose to address the continuing environmental
    encroachment pressures that diminish the quality of training at
    alternative ranges?
        Secretary Johnson. We have identified several encroachment issues
    that if allowed to go unmanaged and unregulated will continue to
    compromise the effectiveness of all our training and testing missions.
    DOD and the military services have been in discussions with OMB, the
    Council of Environmental Quality, the Environmental Protection Agency
    (EPA), the Fish and Wildlife Service at the Department of Interior, and
    the National Oceans and Atmospheric Administration (NOAA) at the
    Department of Commerce. Together, as a team, and with the help of
    Congress, we will work to find solutions and we will properly address
    the challenges of encroachment on all of our ranges. We are hopeful
    that we can find long-term solutions rather than ``work-arounds'' to
    the pressures of encroachment that will allow the Navy to sustain range
    operations.

        66. Senator Inhofe. Secretary Johnson, regarding Vieques, the Navy
    maintains that by May 2003 they will be able to identify ``one or more
    alternative training facilities--to provide an equivalent or superior
    level of training for units of the Navy.'' A number of land- and sea-
    based ranges on the east coast are being considered as alternatives to
    Vieques. Has the Navy begun its National Environmental Policy Act
    (NEPA) analysis regarding the use of these alternative training
    facilities? When will that NEPA analysis likely begin and end? Will
    training be interrupted pending the completion of the NEPA analysis?
        Secretary Johnson. Independent of replacing Vieques, Navy has begun
    environmental analysis to support enhancement of training capabilities
    at individual land and sea-based ranges on the east coast. Some of
    these site-specific analyses are already complete; others will require
    more time. This process of site specific analyses is designed to
    optimize training opportunities at individual locations and provide
    flexibility to operational commanders so they can adapt unit and battle
    group training needs in response to a dynamic mission, training
    schedule, and natural environment. We anticipate that some of these
    sites could accommodate training currently done on Vieques. While much
    has been accomplished in planning for alternative training sites, we
    have not formulated a final plan to replace the training opportunities
    now available on Vieques.

        67. Senator Inhofe. Secretary Johnson, given the fact that
    environmental encroachment issues already exist at ranges all along the
    east coast, what would the Navy propose to do if, after May 2003, the
    NEPA analysis reveals that many of the alternative ranges cannot
    support additional training?
        Secretary Johnson. The Navy anticipates a training strategy that
    will use a combination of existing ranges, methods, and advanced/
    improved technologies to meet future training requirements. The intent
    of the strategy will be to ensure no single range complex becomes a
    point of failure for the training strategy as a whole.

        68. Senator Inhofe. Secretary Johnson, at Camp Lejeune, North
    Carolina, the community has already reacted very negatively to the
    possibility of serving as a training alternative to Vieques. How does
    the Navy propose to deal with such inevitable community reactions?
        Secretary Johnson. The Navy is, and will continue to be, a good
    environmental steward of the properties entrusted to us. The
    appropriate level of analysis will be prepared pursuant to the National
    Environmental Policy Act (NEPA) to ensure that Navy decision makers and
    the public are fully informed about potential environmental impacts
    associated with training alternatives.

                   GENERAL ENVIRONMENTAL ENCROACHMENT ISSUES

        69. Senator Inhofe. Mr. DuBois, Secretary Fiori, Secretary Johnson,
    and Secretary Gibbs, the military departments have primarily responded
    to environmental encroachment issues through the development of ``work-
    arounds'' or training constraints imposed as a result of legal
    requirements. Other than ``work-arounds,'' what specifically is each of
    the military departments doing to resolve these issues to ensure
    realistic training now and in the future? How is the Department of
    Defense facilitating the services' efforts in this area?
        Mr. DuBois. Last December, the Deputy Secretary of Defense directed
    the Under Secretary of Defense for Personnel and Readiness and myself
    to form an Integrated Product Team (IPT) to act as the Department's
    coordinating body for all encroachment issues on ranges, operating
    areas, and other training locations. The IPT is formally working these
    issues. It has formed two groups, an Overall Integrated Product Team
    (OIPT), which Dr. Mayberry and I chair with Department principals, and
    a working IPT, which includes staff members from both OSD and the
    military departments. Although we have many initiatives underway, they
    can be categorized under five broad headings: leadership and
    organization, policy and plans, programs and funding, outreach, and
    legislation and regulation. The IPT is working under the broad guidance
    of the Department's Senior Readiness Oversight Council, which is
    chaired by the Deputy Secretary. The IPT has begun work on key elements
    of the problem, and we have significant initiatives planned and
    underway.
        Secretary Fiori. The Army is working internally and with other
    agencies with environmental regulatory responsibilities to mitigate the
    effects and potential effects that encroachment has on our training and
    readiness. Our principal internal effort is the Sustainable Range
    Program (SRP). The objective of SRP is to maximize the capability,
    availability, and accessibility of ranges and training land to support
    doctrinal training and testing requirements. SRP is based on three
    tenets:
        (1) Scientifically defensible information. Develop and maintain
    complete data on all aspects of ranges--operational characteristics of
    training facilities, physical characteristics of real property, and
    data on the range as part of the natural and cultural environment.
        (2) Integrated management. Integrate across the four disciplines
    that directly affect ranges: range operations and modernization;
    facilities and installation management; explosives safety; and
    environmental management.
        (3) Outreach. Inform political leadership, regulators, and
    communities and improve understanding of the Army's need for training
    and testing and the Army's more sophisticated range management
    approach. The Office of the Secretary of Defense is working with the
    services to develop overarching Department policy for sustainment of
    ranges and operating areas. This policy will support the long-term
    planning and programming necessary to ensure our ranges and training
    areas meet mission needs now and into the future.
        Secretary Johnson. DOD and the military services are pursuing
    programmatic solutions, administrative fixes, and regulatory changes.
    We have developed a comprehensive range sustainment approach to manage
    encroachment issues. The approach includes the development of
    comprehensive Range Complex Management Plans, efforts to establish
    regulatory clarifications, public outreach and education, dialogue and
    negotiations with regulatory agencies, and regional and national
    initiatives. The SROC established an Encroachment IPT to coordinate all
    issues of encroachment within the services. The IPT developed action
    plans to address specific encroachment issues, and oversees their
    implementation. Another work group has developed the DOD Munitions
    Action Plan (MAP) addressing life-cycle management of munitions from
    acquisition through demilitarization. DOD is also working on an
    encroachment strategy for the Southern California/Arizona region. The
    strategy will engage stakeholders and range managers to identify issues
    and develop solutions to regional encroachment that will be applied
    nationally if successful. DON is budgeting for comprehensive range
    sustainability studies at Navy and Marine Corps ranges. These studies
    will include Range Complex Management Plans, regulatory compliance
    evaluations, on-site contaminant assessments, and encroachment
    vulnerability analyses.
        We have engaged OMB, CEQ, EPA, DOI, and DOC in discussions
    regarding encroachment issues. In some instances, however, legislative
    changes may be required. In some cases, the requirements that must be
    amended or clarified are in existing legislation so legislation
    provides the best vehicle to address the issue.
        Secretary Gibbs. Several policies and initiatives ongoing in the
    Air Force will be of assistance to avoiding readiness impacts in the
    future. First, the Air Force is working to develop effective metrics to
    better define readiness requirements and vulnerabilities. A better
    understanding of the problem will allow better solutions. Second, the
    Air Force will continue the practice of investing in scientific
    research and analysis to better inform regulatory decision makers and
    avoid unnecessary readiness limitations.
        The military departments also participate continually in
    legislative and regulatory processes to craft solutions for readiness
    and the environment. The Air Force has developed standardized language
    for proposed wilderness bills to preserve access and overflight of the
    lands proposed as wilderness in support of our military mission, while
    training in a manner compatible with the wilderness designation.
        Finally, the Air Force is working closely with the Federal Aviation
    Agency (FAA) on the National Airspace redesign efforts, and is
    emphasizing pollution prevention initiatives in operational activities.

        70. Senator Inhofe. Mr. DuBois, Secretary Fiori, Secretary Johnson,
    and Secretary Gibbs, the ability to conduct live-fire training at
    military ranges is at risk because of a broad spectrum of environmental
    encroachment issues. I am aware of the training restrictions imposed at
    Massachusetts Military Reservation and the threats to live-fire
    training at Makua Military Reservation and other ranges throughout the
    Department of Defense. In light of these issues, what macro resolutions
    are being sought to preserve quality training throughout the Department
    of Defense?
        Mr. DuBois. Draft legislation will be provided to Congress to
    clarify and amend existing legislation that will contribute toward
    preserving quality training throughout the Department of Defense.
    Because maintaining the readiness of our forces is one of the
    Department's highest priorities, it is critical that we strive to
    maintain a ``measured balance'' between our test and training
    requirements and sound environmental stewardship. We aim to seek this
    balance in a way that considers the concerns of the neighboring
    communities near our ranges and operating areas. Some of the issues may
    be amenable to regulatory fixes or even to administrative policy
    solutions. As the administration pursues statutory clarification, we
    are ready to work closely with appropriate congressional committees to
    fully apprise these committees of the basis for and objectives of any
    necessary clarifications. I am convinced that the goals of
    environmental stewardship and realistic military training are not
    mutually exclusive.
        Secretary Fiori. As I stated in response to your previous question,
    the Army is working internally and with other agencies with
    environmental regulatory responsibilities to mitigate the effects and
    potential effects that encroachment has on our training and readiness.
    Our principal internal effort is the Sustainable Range Program (SRP).
    The Office of the Secretary of Defense is working with the services to
    implement a Department wide policy for the sustainment of ranges and
    operating areas.
        Although we believe that our efforts will minimize the impacts of
    encroachment on our ranges and training lands, we also recognize the
    need to clarify the application of several environmental laws to
    military testing and training. The Army has been working with our
    sister services and the Office of the Secretary of Defense to develop
    initiatives that clarify our responsibilities under a variety of
    environmental statutes. These initiatives focus on supporting our
    training activities and allow flexibility to consider impacts to
    military readiness in the implementation of environmental statutes.
        Secretary Johnson. The Department of Defense is subject to a great
    number of environmental requirements, and is looking toward both micro
    and macro resolutions. Micro resolutions are typically done at specific
    sites or throughout a region. The Department is also working with OMB
    and other Federal agencies on macro, or nation-wide solutions. Where
    specific issues cannot be resolved through policy or regulatory
    actions, the Department will seek the support of Congress for
    legislative clarifications.
        Secretary Gibbs. The Air Force is implementing a variety of
    solutions to preserve quality of training on its ranges. These include
    effective readiness metrics; good science; legislative and regulatory
    interface; and investment in pollution prevention. Other macro level
    efforts include using the Integrated Natural Resource Management Plan
    (INRMP) process to engage local, State, and Federal wildlife officials
    to resolve many of the management issues at Air Force ranges. The Air
    Force is also working to ensure its weapon system acquisition processes
    address encroachment issues such as noise in the design and production
    phases to limit impacts when aircraft or ordnance are deployed.

                           ENVIRONMENTAL LEGISLATION

        71. Senator Inhofe. Mr. DuBois, growing urbanization has
    transformed many military training ranges into ``islands of
    biodiversity'' that contain endangered species and critical habitats.
    Fleet operations have also been effected by concerns related to marine
    species and the sustainability of the maritime environment. During the
    hearing, it was noted that there are some legislative proposals that
    under consideration within the Department. Could you describe the
    nature and status of these proposals in more detail?
        Mr. DuBois. Yes, the Department intends to submit draft legislation
    to Congress. The major elements are:
        Endangered Species Act (ESA): Confirm an existing policy (under
    court challenge) that provides that DOD cooperation with the U.S. Fish
    and Wildlife Service on natural resource management may make the
    designation of critical habitat on DOD lands unnecessary.

             This legislation confirms existing policies of the
            last two administrations.
             The legislation explicitly requires that the Defense
            Department continue to consult with the Fish and Wildlife
            Service and the National Marine Fisheries Service under Section
            7 of the ESA; the provisions of the ESA, as well as other
            environmental statues such as the National Environmental Policy
            Act, would continue to apply.

        Marine Mammal Protection Act (MMPA): Follow the National Research
    Council's recommendation that the current, ambiguous definition of
    ``harassment,'' of marine mammals, which includes ``annoyance'' and
    ``potential to disturb,'' be focused on more biologically significant
    effects.

             The legislation confirms existing practices of the
            last two administrations, endorsed by the National Research
            Council.
             Although excluding transitory, biologically
            insignificant effects from regulation, the MMPA would remain in
            full effect for biologically significant effects--not only
            death or injury but disruption of biologically significant
            activities.
             DOD currently funds much of the most significant
            research on marine mammals, and will continue this research in
            the future.

        Migratory Bird Treaty Act (MBTA): Reverse a March 2002 court
    decision interpreting the MBTA to prohibit training at the Farallon de
    Medinilla (FDM) range in the Western Pacific due to concerns about even
    low numbers of bird deaths.

             The legislation restores the legal and regulatory
            status quo as it existed for over 80 years, until the FDM
            decision in March 2002.
             The FDM case was brought in the DC Circuit, which has
            jurisdiction over all DOD activities. As a result, the FDM case
            puts at risk military aviation, military telecommunications,
            and live-fire training nationwide.

        Clean Air Act (CAA): Maintain DOD's commitment to CAA standards
    while providing flexibility to meet State air quality policies and
    training and readiness requirements.

             The CAA currently prevents DOD from beginning
            readiness activities involving even relatively minor increases
            in emissions until it can demonstrate immediate compliance with
            State clean air plans.
             Without greater flexibility, the conformity
            requirement could be a significant obstacle to basing military
            aircraft in any Southern California location, as well as a
            potentially serious factor in siting the Joint Strike Fighter
            and the Advanced Amphibious Assault Vehicle.
             The legislative proposal reaffirms DOD's obligation to
            meet State air requirements but allows DOD and State regulators
            more time to ensure full compliance.

        Resource Conservation and Recovery Act (RCRA) and Comprehensive
    Environmental Response, Compensation, and Liability Act (CERCLA),
    commonly known as Superfund: Confirm that the cleanup of military
    munitions is not required so long as munitions remain on the
    operational ranges. DOD's obligation to cleanup off-range munitions and
    munitions causing imminent danger on-range would remain unchanged.

             The legislation does not modify DOD's cleanup
            responsibilities under CERCLA or RCRA at Formerly Used Defense
            Sites; closed, closing, or transferring ranges; or currently
            operational bases that close in the future.

        Cooperative buffer zone acquisition authority: Allows military
    departments to enter into agreements with third parties--such as
    private land preservation organizations--to prevent urban development
    that threatens testing and training. The proposal would assist DOD with
    preserving ``buffer zones'' between ranges/bases and urban areas.
    Buffer zones provide critical habitat for endangered and threatened
    species.
        Conveyance of surplus property for conservation purposes: Allows
    DOD to convey surplus property to a State or local government, or to a
    nonprofit conservation organization. The proposal allows the transfer
    of land only if it is used for conservation purposes in perpetuity.

        72. Senator Inhofe. Secretary Fiori, Secretary Johnson, and
    Secretary Gibbs, growing urbanization has transformed many military
    training ranges into ``islands of biodiversity'' that contain
    endangered species and critical habitats. Fleet operations have also
    been effected by concerns related to marine species and the
    sustainability of the maritime environment. During the hearing, it was
    noted that there are some legislative proposals that under
    consideration within the Department. What, if any, impediments are each
    of you experiencing regarding these proposals?
        Secretary Fiori. I would not characterize the efforts to develop
    our legislative clarification proposals as ``impediments.'' Rather, the
    Department is working internally and with other agencies within the
    administration to refine and focus the proposals to just those needed
    to preserve military readiness without reducing the level of protection
    to human health and the environment. When the Department provides the
    legislative clarification proposal to Congress it will be a fully
    coordinated administration position that serves both military readiness
    and environmental protection requirements.
        Secretary Johnson. We have worked closely within the Department of
    Defense and other federal agencies, including the Department of
    Transportation, the Department of Commerce, the Environmental
    Protection Agency, and the President's council on environmental quality
    to craft a carefully tailored legislative package that provides us with
    the flexibility and balance we need to meet mission requirements while
    still protecting the environmental values that we as a nation cherish.
    This debate has taken more time than expected, but we feel that
    important to present a fully vetted administration proposal to
    Congress.
        Secretary Gibbs. Several proposals to clarify the implementation of
    environmental laws to military readiness activities were developed by
    the Department of Defense and are currently under consideration by
    Congress as the Readiness and Range Preservation Initiative.

        73. Senator Inhofe. Mr. DuBois, Secretary Fiori, Secretary Johnson,
    and Secretary Gibbs, during this session of Congress the Senate is
    expected to resume debate on comprehensive energy legislation.
    Apparently, the Department of Defense and the services have concerns
    regarding both the House and Senate versions of this legislation. Could
    you explain those concerns and how you propose to address them with
    Congress?
        Mr. DuBois. The attached Statement of Administration Policy from
    the Secretary of Energy reflects the Department of Defense's position
    as well.

        Secretary Fiori. The Army concurs with the views expressed by Mr.
    DuBois. The Army is committed to reducing its energy consumption since
    lower energy costs free up resources for more critical items, it
    reduces our reliance on foreign energy sources, and it benefits the
    environment.
        While the Army supports comprehensive energy legislation, we
    believe that there are provisions in the proposed legislation that will
    adversely affect national security, and our ability to meet energy
    reduction goals.
        The proposed legislation changes the performance standards for
    energy reduction goals and the baseline from 1985 to 2000. This creates
    different baseline performance standards than those used in Executive
    Order 13123 and Fiscal Year 2002 National Defense Authorization Act,
    doubling the Army's tracking and reporting requirements. The new
    performance goals also penalize the Army for pursuing energy
    conservation aggressively since 1985. The Army has achieved a 27.1
    percent reduction since 1985, and is on track to meet the current
    fiscal year 2010 goal.
        The proposed legislation requires that all Federal buildings be
    metered or sub-metered by October 2002. All Army installations are
    metered, but few buildings are separately metered. Initial cost to
    meter every building is estimated at $500 million, with continuing
    costs to read and maintain. Metering buildings will divert resources
    from readiness, quality of life, and facilities sustainment, and weaken
    efforts to make the most effective use of our energy conservation
    dollars. Metering can be useful in energy conservation, but does not
    save energy by itself.
        The Army is also interested in protecting its ability to develop
    geothermal energy resources on Army land. The pending amendment to the
    Senate bill threatens the Army's ability to manage and control
    geothermal energy production on its lands. Such provisions will also
    restrict the Army's ability to ensure continuous and effective use of
    its lands for their primary functions: testing of weapons systems and
    mission essential training of soldiers.
        Secretary Johnson. While the Department of the Navy supports
    comprehensive energy legislation, there are several provisions that we
    believe will affect national security adversely, while other provisions
    could be modified to better support our energy efforts. This bill would
    require the Department to expend fiscal resources needed for more
    critical programs. Some examples of specific issues are:
        The House version of the energy bill, and a pending amendment to
    the Senate bill, threaten the Department's ability to manage and
    control geothermal energy production on its lands. Such provisions will
    also restrict the Department's ability to ensure continuous and
    effective use of its lands for their primary functions: testing of
    weapons systems and mission essential training of pilots. Also, the
    revenues from the geothermal energy programs are used by the military
    departments to offset the costs of managing the programs and are re-
    invested in various renewable energy programs (e.g., solar and wind
    energy). Provisions impacting the Department of Defense's geothermal
    program will adversely impact the development of additional geothermal
    energy at Naval installations.
        Both bills propose that all Federal buildings be metered or sub-
    metered. Metering for the Department is done at the installations
    level. However, only some of the Department's individual buildings are
    metered. The cost to meter all buildings is estimated at $500 million
    and is cost prohibitive. Metering buildings would divert resources from
    readiness, quality of life, and facilities sustainment, while
    undermining efforts to ensure the most effective use of our energy
    conservation dollars. Metering can play a useful role in energy
    conservation, but is not a universal solution. Recommend continuing
    metering decisions based on life cycle cost.
        Proposed legislation would change the performance standards for
    energy reduction goals and the baseline from 1985 to 2000. This creates
    a different baseline and performance standards than used in Executive
    Order 13123 and fiscal year 2002 Defense Authorization Act (PL 107-
    107), effectively doubling the Department of Defense's tracking and
    reporting requirements. The new performance goals are a 20 percent
    reduction by 2011 from a 2000 baseline, as compared to the existing 30
    percent reduction by 2005 and 35 percent reduction by 2010 from a 1985
    baseline. The section also penalizes the Department for pursuing energy
    conservation aggressively since 1985. Agencies with less aggressive
    programs, which consumed more energy in 2000, will find it easier to
    meet the new standards. Recommend retention of current Executive Order
    13123 and fiscal year 2002 Defense Authorization Act (Public Law 107-
    107) goals and retention of fiscal year 1985 baseline.
        The proposed legislation will require the Federal government to
    purchase at least 3 percent of its electricity from renewable sources
    by fiscal year 2003, 5 percent by fiscal year 2005, and 7.5 percent by
    fiscal year 2010. The Department of Defense currently purchases less
    than 1 percent of its electricity from renewable sources, primarily
    because purchasing renewable energy usually requires a premium over
    standard rates. Increasing demand ahead of the available supply will
    only exacerbate this problem and force the Department to divert
    resources from readiness, facilities sustainment, and quality of life
    to meet this requirement. Essentially, the Department of Defense will
    be indirectly subsidizing the renewable electrical energy industry.
        Secretary Gibbs. The Air Force has prepared position papers
    addressing key provisions of concern. All the services coordinated on
    the papers, which were also provided to OSD. The Navy and Air Force
    Secretariats will be communicating the concerns via respective
    legislative liaison functions.

                         BASE REALIGNMENTS AND CLOSURES

        74. Senator Inhofe. Mr. DuBois, Secretary Fiori, Secretary Johnson,
    and Secretary Gibbs, the National Defense Authorization Act for Fiscal
    Year 2002 authorized an additional round of base realignments and
    closures (BRAC). Previous congressional opposition to BRAC was
    influenced by many factors, including the Department of Defense's
    inability to accurately quantify cost savings, the lack of
    accountability for unexpended cleanup funds, inadequate funding for
    environmental cleanup, criticism regarding delayed property transfers,
    concerns regarding political intervention in the 1995 BRAC round, and,
    more recently, questions related to the infrastructure necessary to
    support the war on terrorism. How are the services addressing these
    concerns, particularly as an additional round of BRAC is considered
    within the Department of Defense?
        Mr. DuBois. The Department estimates that, through 2001, the four
    BRAC rounds have generated almost $17 billion in net savings, with over
    $6 billion in annual recurring savings thereafter. The General
    Accounting Office has consistently stated that BRAC generates
    significant savings. Their latest report validates these costs and
    savings estimates. The Department recognizes, as has the GAO, that
    these savings, while significant, are difficult to track with
    precision. To improve the process for estimating savings for a BRAC
    round in 2005, the Department will develop a Defense-wide systematic
    approach for the periodic updating of initial base closure savings
    estimates.
        Regarding the management of unexpended cleanup funds, the
    Department is taking steps to ensure all BRAC funds are both obligated
    and expended in a timely manner. The military services are recovering
    prior year funds that are no longer required and are applying these
    funds to current requirements. Over 90 percent of the Department's
    fiscal year 2001 appropriation was obligated during the first year.
    Through February 2002, the military services have expended or
    liquidated 99 percent of all obligations of fiscal year 1996 and prior
    year BRAC appropriations, as reported by the Defense Finance and
    Accounting Service. The Department will be closely monitoring these
    resource management issues in the future and applying lessons learned
    to the management of BRAC 2005 resources.
        Regarding the perception of inadequate funds for environmental
    cleanup of BRAC properties, the fiscal year 2003 BRAC environmental
    President's budget request is $29 million higher than the fiscal year
    2002 request. The funding request is based on current requirements and
    capacity to execute and ensures funding to meet legal obligations.
        To improve performance in transferring these properties, I have
    directed the military services to identify impediments to transfer, and
    to propose solutions for all BRAC sites at which property awaits
    transfer. I will routinely review the progress we are making in the
    transfer of these properties with the military services and seek
    solutions to impediments as they are encountered. This review will
    include the development of an updated transfer schedule for each
    installation and validation of budgets to ensure adequate resources are
    dedicated to these efforts. Each military service is responsible for
    the disposition of this property and it is within each service that the
    preponderance of resources is being expended to facilitate the
    remaining transfers.
        The BRAC process has proven to be a fair and open process.
    Specifically, the selection criteria will be open to public comment; an
    independent commission will review the Secretary's recommendations,
    conduct their own analyses and hold public hearings to maintain
    fairness throughout the process; finally, Congress will have the
    opportunity to act on the President's recommendations for base
    realignments and closure. In response to BRAC 1995 implementation
    concerns regarding privatization, Public Law 107-107 specifies
    conditions under which privatization-in-place may be used.
        A future BRAC round will enable the Department to eliminate excess
    base infrastructure, currently estimated at 23 percent, and to
    rationalize base structure to better support the force structure. The
    BRAC statute requires the Department to develop a Force Structure Plan
    based on probable threats to national security over the next 20 years,
    which includes the threats posed by terrorism. Based on that Force
    Structure Plan and other statutory requirements, the Department
    develops selection criteria with military value as the primary
    consideration. In this way the needs of the Department to support the
    war on terrorism (and to address other probable threats to national
    security) are considered in the BRAC analysis.
        Secretary Fiori. The Army's inability to accurately quantify
    savings: The savings achieved through BRAC are significant and have
    been verified by the Congressional Budget Office, the General
    Accounting Office, and the Army Audit Agency. The Army has closed 112
    installations and realigned an additional 26, which has generated
    annual savings of $945 million for other Army priorities such as
    readiness and transformation.
        The Army's lack of accountability for unexpended cleanup funds:
    Regarding the management of unexpended cleanup funds, the Army is
    taking steps to ensure all BRAC funds are both obligated and disbursed
    in a timely manner. The Army is recovering prior year funds that are no
    longer required and applying these funds to current requirements. Over
    94 percent of the Army's appropriation was obligated during the first
    year. Through March 2002, the Army disbursed 99 percent of all
    obligations of fiscal year 1996 and prior year BRAC appropriations, as
    reported by Defense Finance and Accounting Service. The Army will be
    closely monitoring these resource management issues in the future and
    apply lessons learned to the management of BRAC 2005 resources.
        The Army's inadequate funding for environmental cleanup: In the
    first four rounds, the Army has spent more than 40 percent of all BRAC
    funds on environmental cleanup. This significant commitment of funds
    represents total spending of $2.3 billion for environmental restoration
    through fiscal year 2003. These funds have allowed the Army to complete
    environmental restoration efforts at 90 of the 116 installations in the
    BRAC program through fiscal year 2001. The Army is also programming
    funds to support the remaining (cost to complete) environmental
    requirements, which are now estimated at $889 million. These funds will
    support cleanup efforts at the remaining 26 installations and the
    continued environmental monitoring and operation of engineered remedial
    systems. This aspect of the program presents the most challenges and
    has delayed reuse of some BRAC properties. Recent successes are
    steering efforts towards privatized cleanup efforts, use of
    environmental insurance, and forming cooperative agreements with the
    local communities to complete environmental cleanup. We remain
    adaptable to innovative methods of cleanup and redevelopment.
        The criticism regarding delayed Army property transfers: BRAC
    property transfers have been delayed for many reasons, and each
    property has a unique story. The Army has successfully transferred more
    than 117,000 acres, which is about 47 percent of the total acres made
    excess through the BRAC program. The Army is currently working with
    several local communities to move additional property into local reuse.
    The Army expects to transfer an additional 18,000 acres during fiscal
    year 2002, which includes the transfer of Oakland Army Base in
    California, Bayonne Military Ocean Terminal in New Jersey, and
    Fitzsimons Army Medical Center in Colorado. The Army will continue to
    support all authorized options for transferring property as early as
    possible to the affected local communities.
        The concerns regarding political intervention in the 1995 BRAC
    round: The Department of Defense has not yet established the criteria
    for selecting additional BRAC installations in the round authorized to
    begin in fiscal year 2005. According to the National Defense
    Authorization Act for Fiscal Year 2002, Congress has required the
    Secretary of Defense to publish the proposed criteria in the Federal
    Register by December 31, 2003. The selection criteria ensures that
    military value is the primary consideration in making recommendations
    for the closure or realignment of military installations.
        The concerns related to the infrastructure necessary to support the
    war on terrorism: The Army continues to reassess our CONUS based
    infrastructure requirements in terms of present and future threats and
    mission requirements. We will need to update the 20-25 percent excess
    capacity that was published in the 1998 report to Congress and take
    into consideration: ongoing stationing decisions, which include unit
    transformations; surge requirements and threat scenarios; and forces
    returning from overseas. BRAC 2005 is a new opportunity; it provides us
    the opportunity to analyze future Army stationing requirements and
    determine excess capacity.
        Secretary Johnson. Studies by the General Accounting Office and
    other federal agencies have consistently confirmed that BRAC savings
    are real and substantial. The most recent GAO report of April 5, 2002
    validates this conclusion. The Department of the Navy estimates that
    savings began to exceed costs to close and realign in 2001, and will
    result in approximately $2.5 billion in annual recurring savings. The
    Department of the Navy will be working with the Department of Defense
    to more precisely track and update base closure saving estimates, with
    a view toward more accurately projecting costs and savings in the BRAC
    round in 2005.
        Regarding the management of unexpended cleanup funds, the Naval
    Audit Service recently completed an audit of prior year BRAC
    unobligatated and unexpended funds. The Department of the Navy is
    recovering prior year funds that are no longer required and have
    applied the funding to fiscal year 2001 and fiscal year 2002
    environmental cleanup needs. These prior year funds, along with
    additional BRAC cleanup funds provided in the fiscal year 2002 Military
    Construction Appropriations Act, have resolved the fiscal year 2002
    BRAC cleanup funding shortfall. The fiscal year 2003 BRAC request meets
    all current regulator and community expectations for cleanup.
        The Department of the Navy has completely transferred 60 of the 90
    bases that were closed and were to be transferred to new owners from
    the first rounds of BRAC. Almost 50 percent of the parcels on the
    remaining 30 bases have been transferred, and as noted above, we have
    increased BRAC environmental funding to accelerate cleanup of the
    remaining parcels. We plan to reach a point where a cleanup remedy is
    in place and operating properly at seven additional bases in fiscal
    year 2002 and five in fiscal year 2003, which will allow transfer of
    those properties. We also have successfully used the early transfer
    authority to convey property at Mare Island, CA and Oakland, CA, and
    are actively seeking to move as much property as possible off the
    federal rolls and quickly as possible.
        The Department of the Navy expects that base infrastructure that
    may be necessary to support the war on terrorism will be fully
    considered as part of BRAC 2005. The fiscal year 2002 Authorization Act
    amendment to the 1990 Base Closure and Realignment Act contains a
    number of provisions to ensure that all bases are considered fairly and
    equally, with military value as the primary consideration in making
    closure or realignment recommendations, and with independent checks and
    balances in place throughout the process. Congress specifically
    provided minimum criteria that DOD must consider. Those minimum
    criteria include preservation of military installations in the United
    States as staging areas for homeland defense missions. The Department
    of the Navy is working with the Department of Defense and the other
    Military Departments on specific guidance for conducting BRAC 2005.
        Secretary Gibbs. The Air Force will conduct an analysis in
    accordance with the provisions of the Base Closure and Realignment law,
    selection criteria that Department of Defense is mandated by the law to
    promulgate, and the Secretary of Defense's policies and procedures. The
    Air Force will initiate its analysis when directed to do so by the
    Secretary of Defense.

                  UNIFORM NATIONAL DISCHARGE STANDARDS PROGRAM

        75. Senator Inhofe. Secretary Johnson, the Uniform National
    Discharge Standards (UNDS) Program is an effort to provide a
    comprehensive set of standards for controlling the incidental discharge
    from Navy vessels. Phase I of this program identified 25 discharges
    that will require control based upon the potential for adverse
    environmental impacts. There are indications, however, that only a few
    of these 25 discharges have been, or are programmed to be, explored in
    the Navy's research and development program, which should determine the
    most operationally effective and cost effective solutions. What is the
    present schedule for completion of Phases II and III of the UNDS
    Program?
        Secretary. Johnson. Phase I of the program was completed in June
    1999. This phase took longer than expected because about 7,000 Armed
    Forces vessels had to be divided into vessel classes and then the
    discharges characterized. The characterization included determining
    flow rates, constituents, concentrations, and some sampling. Thirty-
    nine discharged were characterized and it was determined that 25
    discharges were of sufficient environmental consequence that control
    may be warranted. Phase II has proven to be even more complex. Each
    potential pollution control device passing an initial screening must
    undergo detailed feasibility and environmental effects analyses. The
    term feasibility analysis is in itself complex, requiring combined
    analyses of operational impact, practicability, and cost. Finally, all
    information from these analyses is summarized in a discharge assessment
    report that leads to the development of recommended pollution control
    devices. We came to the conclusion that conducting these analyses for
    all 25 discharges at once is not possible with available resources and
    staffing. Navy and EPA are discussing a ``batch'' rulemaking whereby
    the top four or five priority discharges would be handled first. Our
    current estimate is September 2005 to complete the Phase II rule for
    these discharges. We are working with EPA to expedite the rule
    development process. However, the process could take longer depending
    on the resolution of issues such as cumulative impact analysis,
    endangered species consultation, and peer review. If phased and
    developed in batches of about 4-5, Phase II would be completed for all
    discharges in February 2011. Phase III could be completed approximately
    1 year after each ``batch'' of discharges completes Phase II.

        76. Senator Inhofe. Secretary Johnson, is there a detailed Phase II
    Program Objective and Milestone (POAM) for each of the discharges
    requiring control?
        Secretary Johnson. Not Yet. We have a preliminary schedule showing
    September 2005 for the first four discharges. A detailed POAM will be
    developed pending resolution of a number of rulemaking issues.

        77. Senator Inhofe. Secretary Johnson, what is the Navy's preferred
    pollution control device for each of the 25 discharges?
        Secretary Johnson. The Navy and EPA have identified numerous
    potential marine pollution control devices (MPCDs). The ``preferred''
    MPCD for each discharge will not be known until the environmental and
    feasibility analyses are completed.

        78. Senator Inhofe. Secretary Johnson, what are the adverse
    consequences of potential Phase II candidate pollution control devices
    with respect to ship impact, shipboard operations, procurement and
    installation costs, and other compliance costs?
        Secretary Johnson. The Navy and EPA have identified numerous
    potential MPCDs for evaluation in Phase II. Any adverse consequences of
    employing particular MPCDs will be determined as part of the
    feasibility analysis associated with each discharge. However, some
    devices with obvious adverse consequences (e.g., too large for a war
    ship) are screened out initially. Only devices passing the initial
    screening are fully analyzed.

        79. Senator Inhofe. Secretary Johnson, what tests or demonstrations
    have been performed by the Navy to ensure that proposed pollution
    control devices are effective, do not unduly hamper the mission, and
    are affordable from an acquisition, installation, life-cycle cost, and
    manning perspective?
        Secretary Johnson. The UNDS legislation mandates consideration of
    operational impact, feasibility, and cost in identifying potential
    MPCDs. While tests and demonstrations of all potential MPCDs are not
    required by the UNDS legislation, or currently planned, the Navy and
    EPA consider all available performance data from commercial and
    government sources during their analyses and deliberations.

        80. Senator Inhofe. Secretary Johnson, what data has been gathered
    or presented to the Environmental Protection Agency to justify the
    Navy's current status regarding UNDS?
        Secretary Johnson. The Navy and EPA are working jointly on UNDS.
    Substantial detailed data on the nature of discharges was reviewed in
    Phase I. In Phase II, the Navy and EPA have completed some technical
    and feasibility analyses for priority discharges and have developed a
    draft performance standard for one discharge. In addition, data on
    numerous MPCDs has been reviewed.

        81. Senator Inhofe. Secretary Johnson, is there a POAM for Phase
    III of the rulemaking?
        Secretary Johnson. Not at present. A POAM will be developed to
    support Phase III once the Navy and EPA promulgate performance
    standards for the Phase II discharges.

        82. Senator Inhofe. Secretary Johnson, what transitions have been
    planned for systems that have been developed for the treatment of gray
    water discharges?
        Secretary Johnson. The Navy constantly keeps abreast of existing
    and developing technologies in the area of gray water treatment. The
    selection of a treatment technology and the transition of related
    systems to the fleet will be contingent on the completion of UNDS
    rulemaking for gray water.

                           SHIPBOARD WASTE MANAGEMENT

        83. Senator Inhofe. Secretary Johnson, the Navy research and
    development (R&D) program has identified a membrane filtration
    polishing technology that can be added to meet oil discharge
    requirements. However, it is only being implemented on new
    construction. While the cost of this particular technology may be
    prohibitively expensive to back-fit into the entire fleet, there is
    still a need to upgrade the existing systems so that they meet the
    present discharge requirements. Is the Navy's R&D program developing
    alternative, cost-effective ``add-on'' polishing technologies that can
    meet performance standards? If not, why?
        Secretary Johnson. The Navy is not currently developing alternative
    polishing technologies. Additional expenditures of RDT&E program funds
    to develop and test more polishing technologies are not required for
    the following reasons: (1) Navy vessels are currently in compliance
    with domestic discharge regulations for bilge water; (2) Navy has
    already identified the best polishing technology that meets the Navy's
    requirements for new construction ships; and (3) a joint EPA-Navy
    rulemaking process, called Uniform National Discharge Standards (UNDS),
    is currently evaluating all bilge water treatment technologies.

        84. Senator Inhofe. Secretary Johnson, the Compensated Fuel Ballast
    program is being terminated without developing the necessary design
    guidance that would eliminate oil discharges when refueling. Why has
    the program been terminated? How will the need for design guidance be
    addressed?
        Secretary Johnson. The Navy has completed RDT&E for implementing
    Compensated Fuel Ballast System improvements. Modeling tools and basic
    design guidance for compensated fuel ballast systems to reduce
    inadvertent fuel discharges and reduce water intrusion have been
    transitioned to new ship construction programs from the Shipboard
    Environmental Protection Program. Additionally, the fleet has
    implemented stringent fuel transfer requirements on existing ships with
    compensated fuel ballast systems to minimize the risk of oil discharges
    during refueling operations. Finally, the UNDS rule-making process will
    determine future standards of performance for military compensated fuel
    ballast system discharges.

        85. Senator Inhofe. Secretary Johnson, the Plasma Arc Waste
    Destruction program is not being transitioned to the Advanced
    Development Program in spite of the potential interest of future
    aircraft carrier programs. Why is the Plasma Arc Waste Destruction
    program not being transitioned?
        Secretary Johnson. There is no legal or regulatory requirement for
    development, test, and installation of a Plasma Arc Waste Destruction
    System (PAWDS) on a Navy vessel. The present fleet is in compliance
    with applicable solid and plastic waste discharge regulations. New
    construction ships will also be in compliance. Although the Shipboard
    Environmental Protection Program is not funding development of plasma
    arc systems for ships, the future aircraft carrier program office is
    supporting development of PAWDS for the CVN(X).

        86. Senator Inhofe. Secretary Johnson, the Navy has existing
    shipboard waste management systems and equipment used for addressing
    solid waste, sewage, gray water, and bilge water. What is the condition
    of the Navy's shipboard waste management systems and equipment with
    respect to compliance, functionality, maintainability, supportability,
    and affordability?
        Secretary Johnson. The present fleet is in compliance with existing
    domestic discharge regulations on solid waste, sewage, gray water, and
    bilge water utilizing installed equipment that is fully functional
    maintainable and supportable. Affordability issues are fully reviewed
    during the developmental stage of all shipboard waste management
    equipment to ensure procurement of the most cost effective equipment,
    having the least operational impact, and requiring minimal staffing.

        87. Senator Inhofe. Secretary Johnson, have the total actual
    ownership costs of existing shipboard waste management systems and
    equipment been tracked to determine the cost and affordability of
    future solutions? If not, why?
        Secretary Johnson. Total actual ownership cost studies for
    individual shipboard waste management systems and equipment have not
    been done nor are they required. However, procurement, installation,
    and developmental costs are tracked. Affordability issues are always
    considered early in the acquisition process, along with operational
    impacts. The goal is to select equipment with the optimal combination
    of factors such as acquisition costs, maintenance costs, environmental
    impact, staffing requirements, and operational impact.
                                     ______

                  Questions Submitted by Senator Wayne Allard

                       FORMERLY USED DEFENSE SITES BUDGET

        88. Senator Allard. Mr. DuBois and Secretary Fiori, there are at
    least 60 formerly used defense sites in Colorado with environmental
    contamination that have been identified by the Corps of Engineers for
    restoration under the Formerly Used Defense Site (FUDS) program. The
    Corps has been working on FUDS for almost 20 years, yet has failed to
    clean up any of the high priority sites in Colorado--sites with
    uncontrolled environmental toxins threatening drinking water sources
    and hazardous unexploded ordnance contamination. Over the last few
    years, the FUDS cleanup budget has been under funded in Colorado and
    nationally to complete even high risk and high priority sites. What are
    your plans and schedule for funding FUDS cleanup in Colorado and
    nationally?
        Mr. DuBois. There are approximately 60 properties on the Corps of
    Engineers' FUDS Inventory List for the State of Colorado. The Corps
    estimates that fewer than half of those sites are contaminated or
    potentially contaminated, and necessitate cleanup under the FUDS
    program. The Corps has completed the following FUDS projects in the
    State of Colorado: AF Finance and Accounting Center; Denver Ordnance
    Plant; F.E. Warren AFB Sites 9 through 12; Fort Logan; Granada
    Relocation Center; La Junta Army Airfield; Lowry S-1 Complexes 1A and
    1B; and Pueblo Army Air Field. The Corps of Engineers is currently
    working with the State of Colorado to develop a schedule for cleanup,
    or statewide management action plan (MAP), for FUDS in Colorado. The
    MAP will identify cleanup, projected schedules, and overall project
    funding requirements for each FUDS within the State.
        Secretary Fiori. There are approximately 60 properties on the Corps
    of Engineers' FUDS Inventory List for the State of Colorado. The Corps
    estimates that less than half of those sites are contaminated or
    potentially contaminated and eligible for cleanup under the FUDS
    program. The Corps has completed the following FUDS projects in the
    State of Colorado: AF Finance and Accounting Center; Camp Hale; Denver
    Ordnance Plant; F.E. Warren AFB Sites 9 through 12; Fort Logan; Granada
    Relocation Center; La Junta Army Airfield; Lowry S-1 Complexes 1A and
    1B; and Pueblo Army Air Field. The Corps of Engineers is currently
    working with the State of Colorado to develop a schedule for cleanup,
    or a statewide management action plan (MAP), for FUDS in Colorado. The
    MAP will identify cleanup, projected schedules, and overall project
    funding requirements for each FUDS site within the State. Nationally,
    the President's Budget request provides funding for all legal
    requirements and includes an increase over last year's budget request
    specifically targeted to address unexploded ordnance requirements.

        89. Senator Allard. Mr. DuBois and Secretary Fiori, how much
    funding would you expect to need annually to be able to complete the
    FUDS cleanup in the next 20 years?
        Mr. DuBois. The cost to complete estimate for the FUDS program has
    increased dramatically in the last 3 years. The increase is largely
    attributable to conservative assumptions concerning possible future
    actions that may be required to address potential UXO-related problems,
    and is generally based on preliminary information. We currently do not
    know the extent of the requirement, but are in the process of
    developing estimates and potential remedies. The President's budget
    request provides funding to meet all currently established cleanup
    schedules and includes an increase over last year's budget request
    specifically targeted to address known UXO requirements.
        Secretary Fiori. FUDS program requirements have increased
    dramatically in the last 3 years primarily as the result of the
    addition of new FUDS sites and munitions response requirements. Long-
    term cost estimates for FUDS cleanup are generally based on preliminary
    information and largely attributable to conservative assumptions about
    possible future actions that may be required to address potential UXO-
    related problems. Thus, the UXO-related cost estimates, in particular,
    are not robust enough to be reflective of funding requirements.
    Additionally, regardless of the cost, the Department does not believe
    it is technically feasible to complete required munitions responses in
    20 years. The Department is working diligently to determine the full
    extent of munitions response requirements, assess the technology for
    such, and then to move forward as expeditiously as possible to complete
    required munitions responses. In recognition of this, the President's
    fiscal year 2003 budget request provides funding to meet current
    schedules. It also includes an increase of $22 million, over last
    year's budget request, that is specifically targeted for munitions
    responses.

        90. Senator Allard. Mr. DuBois and Secretary Fiori, how do you
    propose to maintain stable and consistent funding for the life of these
    projects without delaying costs into the out years?
        Mr. DuBois. We believe strongly in the concept of stable funding
    for the environmental restoration program. By stable funding, we mean
    manageable increases or decreases consistent with project requirements.
    Execution capabilities dependent upon staffing, contracting, and other
    resource considerations can be severely affected, both by wide
    fluctuations in funding and by the inability to predict future funding
    levels. DOD continues to seek stable funding and will work within the
    bounds of such funding from year-to-year. The President's budget
    request is in line with the concept of stable funding.
        Secretary Fiori. We believe strongly in the concept of stable
    funding for the environmental restoration prograrn. By stable funding,
    we mean manageable increases or decreases consistent with project
    requirements. Execution capabilities depend on staffing, contracting,
    and other resource considerations and are severely and adversely
    affected, both by wide fluctuations in funding and by the inability to
    forecast and rely on future funding levels. DOD continues to seek
    stable funding and will work within the bounds of such funding from
    year to year. The President's budget request is in line with the
    concept of stable funding.

                     FORMER LOWRY BOMBING AND GUNNERY RANGE

        91. Senator Allard. Mr. DuBois and Secretary Fiori, the Department
    of Defense has been working on the cleanup of unexploded ordnance at
    the Former Lowry Bombing and Gunnery Range (FLBGR) for several years.
    The cleanup is way behind, the budget has been cut in half, and the
    cleanup schedule extended almost 30 years. Under the settlement
    agreement reached with Colorado in 1998, cleanup of the site was
    expected to be complete in about 5 years. Several new subdivisions,
    6,000 new homes, and a high school are being built adjacent to a site
    on the range where simulant filled and inert chemical warfare munitions
    have been recovered. Budget cuts and cleanup schedule delays have
    already delayed construction at several new subdivisions. The high
    school is scheduled to open in August 2003. How much is in your budget
    this year to address cleanup at FLBGR?
        Mr. DuBois. The Corps of Engineers initially discussed a fiscal
    year 2002 budget of $4 million with the State of Colorado. A fiscal
    year 2002 plus-up allowed the Army to increase the FUDS budget for
    Colorado to $6 million. The Corps will add an additional $2 million in
    fiscal year 2002. Extending the cleanup schedule to almost 30 years
    would be necessary if the project were funded at only $4 million per
    year. At $8 million annually, cleanup can be completed in approximately
    10 years.
        Secretary Fiori. The Corps of Engineers initially discussed a
    fiscal year 2002 budget of $4 million with the State of Colorado. A
    fiscal year 2002 plus-up allowed the Army to increase the FUDS budget
    for Colorado to $6 million. The Army will add an additional $2 million
    in fiscal year 2002, restoring the original budget of $8 million.
    Extending the cleanup schedule to almost 30 years would be necessary if
    the project is funded at only $4 million per year. At $8 million
    annually, cleanup can be completed in approximately 10 years.

        92. Senator Allard. Mr. DuBois and Secretary Fiori, can you assure
    us that cleanup will be completed in time for the new high school
    opening?
        Mr. DuBois. No, the cleanup of the Jeep and Demolition Range site
    is not expected to be completed by August 2003 due to the recent
    discovery of potential munitions at the site, and the possibility that
    the area may be designated as a chemical warfare material site. In
    2001, the Corps of Engineers discussed ordnance hazards with the local
    school and the Colorado Department of Public Health and the
    Environment. The Corps notified the school that in the event of an
    incident the evacuation distance could extend to the entrance of
    school. The co-chair of the Corps-sponsored citizen Restoration
    Advisory Board recommended that the school consider delaying
    construction. Notwithstanding this information, the school board
    announced its plan to continue with construction and to open the school
    on schedule, noting bond issues and current overcrowding of existing
    facilities.
        Secretary Fiori. No, the cleanup of the Jeep and Demolition Range
    site is not expected to be completed by August 2003 due to the recent
    discovery of potential munitions at the site and the possibility that
    the area may be designated as a chemical warfare materiel site. In
    2001, the Army discussed ordnance hazards with the school and the
    Colorado Department of Public Health and the Environment. The Army
    notified the school that in the event of an incident the evacuation
    distance could extend to the entrance of the school. Notwithstanding
    this information, the school board announced its plan to continue with
    construction and to open the school on schedule, noting bond issues and
    current overcrowding of existing facilities.

        93. Senator Allard. Mr. DuBois and Secretary Fiori, what are your
    plans and schedule for funding completion of the FLBGR cleanup?
        Mr. DuBois. Details of the schedule for completion of the cleanup
    are provided in the Management Plan, dated March 2001. At a funding
    level of $8-$10 million per year, we expect to complete the
    conventional ordnance clearance activities by 2010. Chemical warfare
    material issues, however, may increase both the cost and time required
    to complete the cleanup.
        Secretary Fiori. Details of the schedule for completion of the
    cleanup are provided in the Management Plan, dated March 2001. At a
    funding level of $8-$10 million per year, we expect to complete the
    munitions response activities for sites containing conventional
    munitions by 2010. However, chemical warfare materiel issues may
    increase the cost-to-complete the cleanup.

                                   CAMP HALE

        94. Senator Allard. Mr. DuBois and Secretary Fiori, a news article
    from last week's Denver Post quotes state officials as saying it will
    take the Corps of Engineers 10 years or longer to clean up Camp Hale,
    Colorado. Hikers, hunters, and recreational forest users are finding
    dangerous live unexploded ordnance in the National Forest at Camp Hale.
    The Camp Hale area is one of the must heavily used national forest
    areas in the country. The Forest Service had to close 1,400 acres of
    the forest 2 years ago, including a popular group campground and a
    segment of the Continental Divide National Scenic Trail because of
    unexploded ordnance contamination. The State was informed that there is
    not enough funding in the FUDS budget to address the site. How long do
    you expect the investigation and cleanup of Camp Hale to take?
    Specifically, what are your plans and schedule funding for the
    investigation and cleanup?
        Mr. DuBois. The Corps is currently budgeting approximately $1
    million per year for Camp Hale cleanup. At this time, there is not
    enough information available about the nature and extent of the hazards
    at the site to accurately estimate the cost to complete the cleanup.
    The Corps is currently working in partnership with the Colorado
    Department of Public Health and Environment (CDPHE) and the USDA Forest
    Service (USFS) to characterize the site. Once the Corps completes the
    characterization, it will undertake the appropriate response action at
    the site.
        Camp Hale is a very large site (up to 247,000 acres), with varying
    terrain (mountainous, forest, etc.) and multiple uses. The Corps plans
    to focus characterization efforts in areas known to have hosted
    ordnance related activities, which will help reduce the time required
    to complete cleanup. The Corps anticipates that characterization will
    be completed by fiscal year 2004.
        Secretary Fiori. The Corps is currently budgeting approximately $1
    million per year for the Camp Hale cleanup. At this time, there is not
    enough information available about the nature and extent of the hazards
    at the site to accurately estimate the cost-to-complete the cleanup.
    The Army is currently working in partnership with the Colorado
    Department of Public Health and Environment and the Forest Service to
    characterize the site. Once the Army completes the characterization,
    they will undertake the appropriate response action at the site. Camp
    Hale is a very large site (up to 247,000 acres) with varying terrain
    (mountainous, forest, etc) and multiple uses. The Army plans to focus
    characterization efforts in areas known to have hosted munitions
    related activities, which will help reduce the time required to
    complete response activities. The Army anticipates that
    characterization will be completed by fiscal year 2004.

        [Whereupon, at 4:35 p.m., the subcommittee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2003

                                  ----------

                            THURSDAY, MARCH 21, 2002

                               U.S. Senate,
                      Subcommittee on Readiness
                                and Management Support,
                                   Committee on Armed Services,
                                                        Washington, DC.

            READINESS OF U.S. ARMED FORCES FOR ALL ASSIGNED MISSIONS

        The subcommittee met, pursuant to notice, at 10:07 a.m. in
    room SR-232A, Russell Senate Office Building, Senator Daniel K.
    Akaka (chairman of the subcommittee) presiding.
        Committee members present: Senators Akaka, E. Benjamin
    Nelson, and Inhofe.
        Majority staff members present: Richard D. DeBobes,
    counsel; Maren Leed, professional staff member; and Michael J.
    McCord, professional staff member.
        Minority staff members present: William C. Greenwalt,
    professional staff member; Ambrose R. Hock, professional staff
    member; George W. Lauffer, professional staff member; Thomas L.
    MacKenzie, professional staff member; Ann M. Mittermeyer,
    minority counsel; and Joseph T. Sixeas, professional staff
    member.
        Staff assistants present: Leah C. Brewer and Daniel K.
    Goldsmith.
        Committee members' assistants present: Erik Raven,
    assistant to Senator Byrd; Davelyn Noelani Kalipi, assistant to
    Senator Akaka; Richard Kessler, assistant to Senator Akaka;
    Eric Pierce, assistant to Senator Ben Nelson; John A. Bonsell,
    assistant to Senator Inhofe; and Michele Traficante, assistant
    to Senator Hutchinson.

              OPENING STATEMENT OF SENATOR JAMES M. INHOFE

        Senator Inhofe. Our hearing will come to order. Our
    chairman, Senator Akaka, is going to be a little bit late, so
    we thought we would go ahead and start our first panel. First
    of all, I have been honored to visit with each one of you in my
    office, except for my good friend General Wald because I was
    unable to be there. I still cannot believe that it was 5 years
    ago that we were together in Aviano, Italy.
        I would like to go ahead and try to abbreviate the witness
    statements and move into a closed session, so we will try to
    expedite this.
        We appreciate everybody being here. I have to say that when
    the control of the Senate went from the Republicans to
    Democrats it really did not change much of what we are doing.
    It happens that Danny Akaka and I are very close friends. We
    were in the same Bible study for 15 years. We have a spirit of
    cooperation that I think exceeds that in any other committee.
        Let me begin by expressing my sympathies and condolences to
    the families, units, and friends of our service men and women
    who were killed or injured yesterday morning during military
    training at Fort Drum, New York. This accident is a vivid
    reminder of the dangers involved in military training. I
    understand that representatives of the Army's Safety Center
    have begun an investigation into the cause of this tragedy. I
    will ask the Army to update the subcommittee during the course
    of the investigation and immediately forward the results to
    this subcommittee when it is completed.
        The Subcommittee on Readiness and Management Support meets
    this morning to discuss the readiness of our Armed Services. It
    is our goal to specifically examine the impact of Operations
    Enduring Freedom and Noble Eagle on the readiness of the total
    force and their ability to conduct their missions. The
    subcommittee will also review the Department's risk assessments
    associated with the revised defense strategy, the status of
    Department's efforts to improve readiness measurements and
    reporting, and the adequacy of the Department's budget request
    for fiscal year 2003 to support both the immediate and the
    long-term readiness goals.
        Along those lines, I would ask, as I did of all of you in
    my office, to be very straightforward. My personal feeling is
    that the budget is inadequate. I think it is probably the best
    that we could get through at this time, but I would like to
    have you talk about those areas that you feel are inadequate or
    not funded properly.
        Let me welcome our witnesses and thank them for
    participating in this hearing this morning. Dr. Paul Mayberry
    has had a distinguished and diverse career in the Defense
    Department and is well prepared for his current
    responsibilities.
        Also, each of the flag officers testifying this morning
    brings a wealth of personal and professional experience with
    them. Collectively, they represent our ability to defend our
    interests in the air and on the land and sea. They have also
    participated in important aspects of military training, an
    integral component of readiness, and I hope they will be able
    to share their perspectives on that as well.
        Like few other times in recent history, our Nation is
    united with the President in our resolve in the war on
    terrorists. In only 6 months, we have destroyed and disrupted
    terrorist networks and liberated a nation held hostage by a
    fanatical regime of terrorists. None of this would have been
    possible without the professionalism and the skill of our
    soldiers, sailors, airmen, and marines.
        I am concerned, however, that the level of readiness and
    the capabilities that have led to the successes in Operation
    Enduring Freedom and Operation Noble Eagle may not be
    sustainable. In fact, the capabilities that the services are
    using today may only represent a limited surge capacity of the
    forces and not the readiness required to sustain a long-term
    war on terrorism and prepare for other challenges to our vital
    national interests.
        We need to do both. Inaction against terrorists is no
    longer an option. We must address the readiness deficiencies
    that we created during the last decade. Our goal was clear
    before September 11: to restore the readiness and vitality of
    the military services to defend all vital U.S. security
    interests. The Clinton administration significantly stressed
    the readiness of the services for nearly a decade. They cut the
    funding while at the same time increasing the deployments of
    our troops and sailors. They virtually stopped funding
    modernization, and this is something that we are going to have
    to overcome.
        Then, of course, along came the war. As the war on
    terrorism continues, restoring readiness and sustaining the war
    is becoming more and more difficult. According to the Commander
    of the National Training Center at Fort Irwin, Air Force
    strategic transport has been unavailable for rotational unit
    support due to war deployments. Two training rotations have not
    deployed their AH-64 attack helicopter units due to the
    nonavailability of the C-17 and C-5 airlift.
        We are really wearing out our airlift capacity, and this is
    something that we hear in every hearing that we have. It is
    going to have to affect where we go from here. I am strongly
    supporting increasing our C-17 fleet. The C-17 was criticized
    during its development, but it has now proved its worth as an
    effective lift vehicle.
        The administration has requested approximately $98 billion
    in funding for fiscal year 2003 for operations and maintenance
    of the services. This averages an approximate increase of over
    9 percent over the amount appropriated in fiscal year 2002.
    With the multitude of tasks the American people are requiring
    of our military, we have to ask ourselves, is this truly
    enough? Can we do more to support the men and women in uniform?
        Lastly, President Bush is right on the mark when he
    encourages Congress, as he did last week, to make funding for
    the military services our highest priority. I agree. I will
    work with Senator Akaka to forward the recommendations of this
    subcommittee with all due haste and diligence. The degree to
    which we can expedite this funding is just one more way we can
    demonstrate our strong support for the men and women in
    uniform.
        This morning the witnesses will testify in two panels: Dr.
    Paul Mayberry, the Deputy Under Secretary of Defense
    (Readiness), and Lt. Gen. Gregory Newbold, the Director of
    Operations (J-3) Joint Staff, will comprise the first panel.
    The second panel will be comprised of the directors of
    Operations for each of the services. Due to the substance of
    the testimony and the subsequent questions, it may be necessary
    for a portion of this hearing to be held in closed session. We
    will have to make that determination after the chairman gets
    here.
        It is important for us to understand that there was a
    wakeup call to the American people. I felt very good about the
    changes in attitude after that horrible tragedy of September 11
    took place. I think there exists the recognition, as tragic as
    it was in New York City and at the Pentagon, that if the
    terrorists had had their weapon of choice, a nuclear warhead on
    a missile, the TV screen that showed the tragedy of the two
    towers would show nothing but a piece of charcoal.
        While this is something that we have faced since the early
    1990s, it is something that the American people did not really
    appreciate. I know because I went out and tried to explain this
    problem. General Wald, you can remember because we talked about
    this in Aviano. I now think that we are in a position to do a
    better job for the American people, but we must do so with all
    haste.
        Dr. Mayberry, we will start with your statement. As is
    always the case, your entire statements will be made a part of
    the record. Dr. Mayberry.

        STATEMENT OF DR. PAUL W. MAYBERRY, Ph.D., DEPUTY UNDER
                    SECRETARY OF DEFENSE (READINESS)

        Dr. Mayberry. Good morning. Thank you very much, Senator. I
    am privileged to be here before you today to address the issues
    of military readiness and the Department of Defense.
        Let me start by saying that our Armed Forces are ready to
    meet the challenges facing our Nation. Our forces, as you said,
    are agile, capable, and well led. From prosecuting the global
    war on terrorism to protecting our Nation's airways, the
    uniformed men and women of our Nation, reinforced by the
    Department's civilians, stand ready to execute the missions
    assigned to them by our Commander in Chief. This readiness is
    not possible without your continued support for our critical
    defense needs.
        You asked us to discuss several issues, and I would
    respectfully request that we do defer some specific discussions
    in terms of the impact of current operations on our readiness
    to conduct other missions to a closed session.
        Senator Inhofe. Let me just interrupt at that point. I
    think it is important on that subject to do as much as you can
    in open session. America needs to know our deficiencies, where
    we are, where we are going to be, and where we have to
    concentrate our efforts and our scarce dollars. So while I know
    there are some sensitive topics, I would hope that as much as
    possible could be handled in open session.
        Dr. Mayberry. I understand and we will do that.
        You also asked that we take a look at the way that we are
    going about revising our readiness reporting system, as well as
    both the Department's budget request for immediate- and long-
    term readiness issues. Let me begin by highlighting some of our
    ongoing efforts in the readiness assessment and reporting
    process.
        One of the most essential elements of our reporting system
    in the Department has been the active involvement of our senior
    DOD leadership in resolving these types of readiness issues.
    The Department's Senior Readiness Oversight Council (SROC),
    which is chaired by the Deputy Secretary of Defense, meets
    routinely to review and discuss the most pressing readiness
    needs. Recently, this council met to focus on actions to
    address the growing threats of encroachment on our air, land,
    and sea training ranges.
        A second issue that the SROC addressed has been the
    modernization and transformation of our major combat training
    centers. Finally, it recently met to evaluate the stresses on
    our forces resulting from the global war on terrorism and the
    unique training, personnel, and equipment demands that that
    campaign imposes on our forces.
        With respect to the improvements that we seek to address in
    the current readiness reporting process, the Secretary has
    asked me to specifically focus upon the ability of our Armed
    Forces to execute fully the missions that they have been
    assigned. We are working closely with the Services, Joint
    Staff, and with the combatant commands to identify these needed
    improvements.
        Our study has basically been completed and concludes that
    the Department should implement a new capabilities-based
    readiness system that would provide timely and accurate
    information on the readiness of our forces, as well as their
    supporting infrastructure. This information would be readily
    available in the deliberate planning process, in responding to
    emerging crises, and also in aiding decisionmaking even during
    hostilities.
        A broad spectrum of real-time information provided by a
    variety of sources, including the combatant commanders, the
    Services, and the defense agencies--will be available to aid
    both defense planners and decisionmakers. The system would be a
    source of valuable information on the readiness of our forces
    to execute their joint mission essential tasks, as well as to
    address the issue of sustainability of our forces over time.
    That is something that we do not do completely well now.
        We believe that this improved readiness system can be
    achieved using existing personnel, training, and logistics
    databases, and that it would reduce or even eliminate some of
    the workload and errors associated with the manual input
    systems that we have today. The system would also provide
    information that reveals broad readiness trend information in
    the resource areas of personnel, unit training, equipment,
    supply, and ordnance. It will capture the military judgments of
    unit leaders as well, which is a critical piece of readiness
    reporting as well.
        Senator Inhofe. Our chairman is here now, and we agree that
    you should go ahead and finish before his opening statement so
    we will not lose your train of thought. Not that you will, but
    we might.
        Dr. Mayberry. Thank you.
        Our plans are to publish guidance from the Secretary in the
    next couple of months, field the initial readiness system for
    operational use in the 2004 time period, and have a full
    operational capability achieved in 2007.
        Maintaining the readiness of our Armed Forces and ensuring
    the well-being of our men and women in uniform are the top
    priorities of the leadership in the Department. These
    priorities are reflected in our fiscal year 2003 budget
    request. Our Armed Forces are the best trained, best equipped,
    and most effective military force in the world and we intend to
    keep them that way.
        The President has emphasized the importance of reversing
    past declining trends in readiness and the 2003 budget is a
    beginning step in that direction. This budget improves military
    readiness by increasing the top line by some $48 billion over
    fiscal year 2002 levels, accelerates critical transformation
    programs, funds the war on terror, and also provides for
    critical programs related to the war.
        But perhaps most importantly, it invests in the
    Department's greatest assets: our people. We are seeking
    across-the-board pay raises and 4.1 percent targeted pay raises
    in the range of $300 million for mid-grade officers and
    noncommissioned officers. It improves military housing and puts
    the Department on track to eliminate substandard housing by the
    2007 timeframe.
        The request also puts us on track to eliminate average out-
    of-pocket expenses for individuals living off base by 2005. The
    budget also requests nearly $23 billion, an astounding amount,
    to cover realistic military health care costs. These
    investments are critical to ensuring the quality of our forces
    and their families as well as the environments in which they
    live and work.
        The budget also provides for the training of our forces. We
    included $140 billion for the operation and maintenance
    accounts (O&M). This includes substantial funding for our unit
    training, as well as operational readiness accounts to cover
    tank miles, steaming days, and flying hours for the services.
    We have increased funding for critical Army training enablers,
    providing resources to ensure the operations of training ranges
    and simulation centers are covered in the management of ground
    maneuver and live-fire training ranges.
        In the Air Force, we are seeing some positive readiness
    trends that indicate that we may have turned the corner on
    chronic problems associated with parts shortages.
        The budget also improves maintenance and sustainment of
    equipment and facilities and increases the availability of
    spare parts. In conclusion, I want to emphasize that our total
    forces, Active, Reserve, and civilians, are ready to meet the
    challenges facing this Nation. We robustly fund the readiness
    of our forces, as well as transforming to meet future
    challenges. We are improving the ways that we measure our
    readiness and transforming our training to meet new strategy.
        We appreciate the continued support of this subcommittee
    for our Armed Forces that ensures that they remain the best
    manned, equipped, and trained military in the world.
        Thank you very much for the opportunity to appear before
    you today and I look forward to addressing your questions.
        [The prepared statement of Dr. Mayberry follows:]

               Prepared Statement by Dr. Paul W. Mayberry, Ph.D.

        Good morning, Chairman Akaka, Senator Inhofe, and distinguished
    members of this subcommittee. On behalf of the Under Secretary of
    Defense for Personnel and Readiness, Dr. David S.C. Chu, I am
    privileged to speak before this subcommittee on the state of military
    readiness in the Department of Defense. With me today is the Director
    of Operations for the Joint Staff, Lt. Gen. Gregory Newbold of the
    United States Marine Corps.
        Let me start by saying that your Armed Forces are ready to meet the
    challenges facing this Nation. Our forces are agile, capable, and well
    led. From prosecuting a Global War on Terror to protecting our Nation's
    airways, the uniformed men and women of this Nation, reinforced by the
    Department's civilian staff, stand ready to execute the missions
    assigned to them by our Commander in Chief. This readiness would not be
    possible without the continued support of this subcommittee for our
    critical Defense needs.
        For this testimony, you asked that I discuss the risk assessed
    against our new defense strategy and the impact of current operations
    on our readiness to conduct other missions. Today's strategic setting
    presents a number of new challenges that we must be ready to address.
    The 2001 Quadrennial Defense Review provided a new risk framework for
    the Department to assess these challenges in four dimensions--
    operational, force management, institutional, and future or
    transformational challenges. I respectfully request we move our
    discussion of these points to a closed session.
        You also asked that I discuss our progress in revising the
    Department's readiness reporting system and the adequacy of the
    Department's fiscal year 2003 budget request in supporting immediate
    and long-term readiness needs. I will focus on these two issues--
    readiness reporting and the fiscal year 2003 budget request--in open
    session.

                              READINESS REPORTING

        I would like to begin by highlighting the status of our ongoing
    efforts to enhance the Department's readiness assessment and reporting
    system.
        One of the most essential elements of our readiness reporting
    system is the active involvement of the senior DOD leaders in resolving
    readiness issues. The Department's Senior Readiness Oversight Council,
    which is chaired by the Deputy Secretary of Defense, meets routinely to
    review and discuss the most pressing readiness issues. Recently, the
    council met to focus on actions to address growing threats of
    encroachment on our air, land, and sea training centers and ranges. I
    believe the Service operations deputies panel will echo the importance
    of this issue later today.
        I am convinced that our success in future military operations will
    depend on having a modernized joint training infrastructure that
    supports realistic, combined arms, force-on-force training for our
    military. Unlike Operation Desert Storm, where we had many months to
    prepare, deploy, and stage forces for an overwhelming attack against
    Iraqi forces in Kuwait--tomorrow's conflicts are likely to be short-
    notice, ``come-as-you-are'' events. A lesson clearly emerging from
    Operation Enduring Freedom is that we must fight joint. This is the
    current reality and the future of warfare--we must train that way. To
    this end, we have recently completed a strategic plan for transforming
    our training that will serve to guide the Department in ensuring our
    forces remain the best trained and most capable in the world.
        The Senior Readiness Oversight Council has also evaluated the
    stresses on our forces resulting from the global war on terrorism. This
    campaign imposes some unique training, personnel, and equipment demands
    upon our forces--particularly so as we continue to provide for homeland
    defense and work to preserve our readiness for other missions. For
    example, to date, we have mobilized over 93,000 Reserve and National
    Guard members. These soldiers, sailors, airmen, and marines are
    integrated into nearly every aspect of Operation Noble Eagle and
    Operation Enduring Freedom.
        In terms of the system we use to report unit readiness, we
    undertook a project last year, at the direction of the Secretary, to
    improve the way we both assess and report unit readiness. The Secretary
    asked us to specifically focus upon the readiness of our Armed Forces
    to execute fully their assigned missions. Over the last few months, we
    have been working closely with the services and the combatant commands
    to identify possible improvements to the current system. We expect our
    study will be completed in the next several weeks, and anticipate
    publishing implementing instructions for a revised system soon after.
        Our study results suggest that the Department should implement a
    new ``capabilities-based'' readiness system to provide timely and
    accurate information on the readiness of our forces and supporting
    infrastructure. This information would be readily available for our use
    in deliberate planning, responding to emerging crises, and to aid
    decision-making during hostilities.
        In our charter for the study, we envisioned a system capable of
    providing real-time readiness information on the Department's ability
    to execute strategic missions and respond to crises. A broad spectrum
    of relevant information--provided by the combatant commands, Services,
    and defense agencies--will be available to aid both defense planners
    and decision-makers. The system will include valuable information on
    the readiness of forces to execute assigned joint mission essential
    tasks as well as the sustainability of the force over time.
        Given the uncertainties in the strategic environment, we are
    planning for a flexible and adaptive readiness reporting system that
    will reduce the likelihood of the Department being surprised by
    unforeseen readiness challenges in the early stages of crisis planning.
        The system will support assessments of force management and
    operational risk as outlined in the Quadrennial Defense Review. We
    believe that this improved reporting and assessment can be achieved by
    using existing personnel, training, and logistics databases. By
    incorporating information from existing transactional databases, we can
    reduce or eliminate workload and errors associated with manual input of
    data. This will further aid our goals of reducing the reporting burden
    and responding more quickly to requests for readiness information.
        The system will also provide information that reveals broad
    readiness trend information in the resource areas of personnel, unit
    training, equipment, supply, and ordnance, and will capture the
    military judgement of the unit commander in his assessment of his
    unit's readiness.
        Our plan is to field the initial readiness system for operational
    use in fiscal year 2004, with full operational capability achieved by
    fiscal year 2007.

                                   RESOURCES

        I will now turn to the fiscal year 2003 budget. Maintaining the
    readiness of our Armed Forces to defend the nation's interests, and
    ensuring the well-being of our men and women in uniform, are the
    highest priorities of the leadership in the Department of Defense.
    America's Armed Forces are the best-trained, best-equipped, and most
    effective military force in the world, and we intend to keep them that
    way.
        The President emphasized the importance of reversing our Armed
    Forces' decline in readiness. The fiscal year 2003 budget helps to
    improve our military readiness by increasing the defense topline by $48
    billion over fiscal year 2002 levels. It accelerates critical
    transformational programs, funds the war on terror, and provides for
    critical programs related to the war. Perhaps most importantly, it
    invests in the Department's greatest asset: its men and women in
    uniform.
        The President's fiscal year 2003 budget requests over $94 billion
    for military pay and allowances, including an across-the-board 4.1
    percent pay raise, and $300 million for the option of targeted pay
    raises for mid-grade officers and non-commissioned officers. It
    improves military housing and puts the Department on track to eliminate
    most substandard housing by 2007--years sooner than previously planned.
    The request also lowers average out-of-pocket housing costs for those
    living off-base from over 11 percent to 7.5 percent in 2003--putting us
    on track to eliminate all out-of-pocket housing costs for the average
    person in uniform by 2005. The budget also includes $10 billion for
    education, training, and recruiting, and nearly $23 billion to cover
    the most realistic cost estimates of military healthcare. These
    investments are critical to ensuring that the smart weapons we develop
    are placed in the hands of smart, well-trained soldiers, sailors,
    airmen, and marines.
        We must maintain the training readiness of our forces to fight the
    wars of today and tomorrow. The fiscal year 2003 budget also provides
    for the training of our forces, and of the equipment with which they
    will train and fight. We requested $140 billion for operation and
    maintenance accounts in fiscal year 2003. This includes substantial
    funding for our unit training and operations readiness accounts.
        This budget funds the services' training and operations accounts--
    tank miles, steaming days, and flying hours for the services. It
    preserves crucial training and operating activities essential to the
    safety and well being of our troops, and their ability to successfully
    accomplish their missions. As outlined by the Secretary of Defense in
    his recent budget hearings, the Department increased the funding for
    these readiness accounts, to include:

             Aircraft operations/flying hours: $11.8 billion, up
            from $11.3 billion in fiscal year 2002;
             Army OPTEMPO: $3.7 billion, up from $3.3 in fiscal
            year 2002;
             Ship operations: $2.4 billion, up from $2.3 in fiscal
            year 2002;
             Depot maintenance: $4.8, up from $4.5 billion in
            fiscal year 2002; and
             Training: $10.0 billion, up from $9.4 billion in
            fiscal year 2002.

        We have increased funding for critical Army ``training enablers''--
    providing resources to sustain the operation of training ranges,
    simulation centers, and the management of ground maneuver and live-fire
    ranges. Adequately funding these enablers reduces unit-training funds
    to pay these infrastructure bills. In the Air Force, we are seeing some
    positive readiness trends that indicate that we may have turned the
    corner on chronic parts problems and shortages.
        In conjunction with the DOD Comptroller, we have also initiated an
    effort to improve our ability to resource and manage unit training and
    readiness. The Operations Readiness working group, co-chaired by my
    office and the comptroller, with representatives from each Service, the
    Joint Staff, and defense agencies, is a new forum to address unit
    training needs. This initiative was chartered to develop a more
    comprehensive approach to ensuring our budgets and programs adequately
    address unit-training requirements. The group has just finished its
    first quarterly review of flying hours, steaming days, and tank mileage
    including dollar execution, and promises to tighten the linkage between
    funding and unit readiness goals.
        The Department has also added resources in fiscal year 2003 budget
    to address other pressing readiness issues, such as those in support of
    homeland defense and the Global War on Terror. This budget enhances our
    abilities to protect our forces against biological and missile attack.
    The budget also improves maintenance and sustainment of equipment and
    facilities. It increases the availability of spare parts and engines--
    keeping ahead of the increasing costs due to equipment age and heavy
    use in current operations.
        In conclusion, I want to emphasize that our forces--our total
    forces--are ready to meet the challenges facing this nation. We are
    robustly funding the readiness of forces and transforming to meet
    future challenges. We are improving the ways we measure our readiness
    and transforming our training to meet the new strategy. We appreciate
    this subcommittee's continued support of our Armed Forces, and of the
    programs that ensure they remain the best manned, equipped and trained
    forces in the world. This concludes my statement. I look forward to
    discussion and any questions you may have.

                  STATEMENT OF SENATOR DANIEL K. AKAKA

        Senator Akaka [presiding]. I want to thank my friend and
    colleague, Senator Inhofe, for beginning this hearing. I want
    to welcome the witnesses this morning, and offer my condolences
    to the families at Fort Drum.
        Senator Nelson, do you have a statement to make?
        Senator Ben Nelson. Mr. Chairman, I would be happy to make
    comments in the process of asking questions rather than start
    with an opening statement. Thank you.
        Senator Akaka. I also want to state that I will place my
    full statement in the record in the interest of time.
        [The prepared statement of Senator Akaka follows:]

                 Prepared Statement by Senator Daniel K. Akaka

        The Readiness and Management Support Subcommittee meets this
    morning to hold a hearing on the readiness of United States forces to
    meet all of their current missions. Of course, the topic in the news
    and on everyone's mind is our current war on terrorism, and especially
    our operations in Afghanistan. Forces from all four of our military
    services have performed magnificently in these operations, and have
    clearly demonstrated at least two important facts.
        First, our Armed Forces are capable and powerful, but even more so
    when they act in concert with each other and complement each other's
    strengths. Their collaboration and creativity has been astounding, and
    has inspired awe not only here at home, but in the capitals of our
    allies, and perhaps even more importantly, those of our potential
    enemies.
        Second, the collaboration that exists between the services has been
    paralleled by cooperative relationships with other countries that are
    pushing new bounds. Seven months ago, it would have been hard to
    imagine that our government would be working, on many levels, with some
    of the countries who have joined us in our fight against a common
    enemy, terrorism. It is my sincere hope that we can continue to build
    upon these relationships in the future.
        Our military members and those of our allies are fighting valiantly
    on our behalf against the scourge of terrorism, and we are grateful.
    But while our attention is focused on those efforts, it is sometimes
    easy to forget that many other military members are conducting other
    important national missions, and there are still others who support the
    forces we have deployed or are preparing to relieve them.
        These men and women are the topic of today's hearing. We have asked
    our witnesses here today to review our other ongoing military
    commitments, and to make us aware of some of the strains that our
    current war is placing on all of our forces' ability to train for and
    carry out the full range of their assigned missions. Further, we ask
    our witnesses to help us take a longer perspective and alert us to
    future readiness challenges, so that we can better prepare for them.
    Our military is proving how years of the best training and leadership
    have made them ready to take on our enemies of today, but we must
    sustain these capabilities to help protect us against our enemies of
    tomorrow. Finally, we look forward to testimony on how DOD is improving
    our ability to measure readiness and identify future challenges.
        I believe this is the first time that any of our six witnesses are
    testifying before our subcommittee, and I want to extend a warm welcome
    to all of you. We greatly appreciate your insights and expertise, which
    add so much to our efforts here in Congress.

        Senator Akaka. General Newbold, we look forward to your
    statement. I had hoped to see a more substantive written
    statement from you, given the importance of the issues we are
    addressing in today's hearing, and would appreciate your other
    witnesses providing additional detail in answers to questions
    this morning.
        I will also be submitting questions for the record for you
    to address and look forward to your prompt response to them.
    General, will you please proceed with your statement.

     STATEMENT OF LT. GEN. GREGORY S. NEWBOLD, USMC, DIRECTOR FOR
                   OPERATIONS (J-3), THE JOINT STAFF

        General Newbold. Mr. Chairman, I would like to also thank
    the subcommittee for having a hearing on a critical topic. I
    would like to submit my written statement for the record. In
    deference to the important subject, what I would like to do is
    preserve the time for questions and answers and go into depth
    on them. Thank you, sir.
        [The prepared statement of General Newbold follows:]

            Prepared Statement by Lt. Gen. Gregory S. Newbold, USMC

        Members of the subcommittee, I am pleased to provide this written
    statement with my views on the readiness of America's Armed Forces and
    their ability to execute our national military strategy. I look forward
    to the opportunity to appear before you.
        I must first acknowledge and thank Congress for its sustained and
    significant support to the men and women of our Armed Forces. We have
    made considerable progress these past several years in several key
    readiness areas: increasing pay and allowances for the force; efforts
    to reform TRICARE; providing adequate military housing; and, most
    importantly, arresting and turning around the decline in near-term
    readiness. I would like to commend this subcommittee, in particular, as
    your support for our soldiers, sailors, airmen, and marines has been
    instrumental in our forces' impressive performance over the past few
    months.
        On September 10, tens of thousands of U.S. forces were deployed
    around the world engaged in operations such as Northern Watch, Southern
    Watch, and the Balkans. As had been the case for years, they provided a
    deterrent effect against crisis in virtually every corner of the globe.
    The nondeployed forces were focused on being prepared to respond to any
    other emerging threats to our national interest. Then, on September 11,
    our Nation was subjected to a terrorist attack that changed our notion
    of security. Your Armed Forces reacted and refocused remarkably well.
    Within minutes we had aircraft in the air to protect our nation's
    skies. Thousands of Active and Reserve Forces deployed throughout the
    country to provide protection to air travel and critical
    infrastructure. In the days following September 11, our adaptability
    and flexibility effort was evident, and a testimony to the training,
    readiness, and quality of our force.
        Today, we are engaged in wide-spread operations against terrorists
    and tyrants as well as defending the homeland. These operations have
    validated our previous readiness assessments provided to this
    subcommittee through the Quarterly Readiness Reports to Congress. Our
    ``first-to-fight'' forces are ready and clearly executing well.
    Moreover, our forces have shown they are not only ready for major
    combat operations, but also demonstrated flexibility to meet emerging
    and unusual mission requirements. In truth, though, if confronted with
    another simultaneous major crisis, we will face challenges in several
    areas, including both traditional readiness issues voiced by the
    services, and joint readiness issues reported by the combatant
    commanders. Furthermore, we have concerns with the potential readiness
    impacts of sustaining, for extended periods, our current pace of
    operations. Aging equipment, spare parts, disrupted maintenance cycles,
    shortages of analysts and linguists, increased demand for radio-
    frequency bandwidth and spectrum, and the stress on our individual
    soldiers are but a few of the areas we are monitoring closely. Lastly,
    as the Department's Homeland Defense roles and responsibilities are
    fully defined, the readiness implications of this growing mission must
    be better assessed.
        While these concerns are focused largely on near-term readiness and
    near-term solutions, we are also pursuing long-term remedies. The
    Department is working the details of a new National Military Strategy
    to implement the vision of the Quadrennial Defense Review, which will
    help better articulate the capabilities the Department must have and
    missions we need to be ready to undertake. At the same time,
    modernization and transformation efforts are expected to achieve
    increased military effects without necessarily increasing the size of
    the force. New concepts, new ideas, and new equipment may mitigate many
    of our readiness concerns over the longer term.
        The period since September 11 has re-validated the requirement that
    our forces will be regularly called upon to operate across a wide
    spectrum of operations--from peace enforcement and homeland security to
    major, intense combat operations. You, the President, the Secretary of
    Defense, and the Chairman of the Joint Chiefs of Staff must know how
    ready are we to undertake different tasks; therefore, we are examining
    better ways to assess the department's readiness. In turn, an improved
    readiness reporting and assessment tool will help us determine where we
    can best utilize the resources provided by Congress, and better
    articulate the risks we are assuming in executing our national military
    strategy. Our goal is to provide commanders an effective means to
    report their readiness and allow rapid, accurate assessments that
    support both operational and resourcing decisions. While there is
    confidence that we can derive accurate assessments from our current
    readiness reporting, improvements are necessary in order to add to the
    system's efficiency and effectiveness.
        Finally, experience has proved that readiness can be a fragile
    commodity. If not maintained it can quickly erode. Congress' support
    over the past years has made dramatic, positive impact on the readiness
    of the force, and our ability to effectively ``meet the call.'' Key to
    maintaining readiness is this continued commitment and the timely
    reimbursement for contingency operations. I look forward to your
    questions.

        Senator Akaka. Thank you very much.
        Dr. Mayberry, on page 5 of your statement you recommend a
    capabilities-based readiness reporting system. How will this
    differ from the current system? For example, would units report
    their capabilities to perform both their most stressful wartime
    missions for major theater wars as well as their ability to do
    peacekeeping and other missions? How would that differ from the
    current readiness reporting system where the training element
    is measured against specific wartime tasks?
        Dr. Mayberry. Our military strategy is now transitioning
    from a threat-based approach to being more capabilities-based.
    This offers unique challenges, as you have highlighted here, to
    overall readiness assessment. Our forces must be able to
    respond in this new strategic environment of uncertainty and
    surprise, and this means that we must be trained and ready with
    our forces to be able to respond with specific competencies and
    capabilities that are not tied to specific exact geographical
    locations or against an explicit enemy.
        As the global war on terrorism clearly illustrates, we do
    not necessarily know who our next enemy will be or where we
    will engage them. The basis for this capabilities-based
    assessment will be on the ability of our units to conduct their
    assigned mission-essential tasks. This contrasts to our current
    readiness approach that is focused more on inputs of people,
    equipment, and training, but does not necessarily focus on the
    outputs or the quality of those measures.
        The focus will be on assessing the ability of the unit to
    conduct its assigned mission-essential tasks related to, for
    example, intelligence, surveillance, and reconnaissance (ISR).
    We have a way to go as we transition to this new military
    strategy, and we have already begun thinking through and
    working through what the implications will be for our readiness
    assessment as well.
        Senator Akaka. An additional question on that: why will it
    take until 2007 before this new readiness reporting system will
    become operational?
        Dr. Mayberry. What we are doing now is going through and
    determining the characteristics that we and the Secretary will
    put forward, working with the Joint Staff and the services as
    well as the combatant commands, to put this type of structure
    in place. Within the next several months, we will publish
    guidance from the Secretary that will then allow the services
    to work through their particular plans.
        Our office will be developing operational prototypes that
    get at more of the real-time nature of working with the
    transactions databases that currently exist, to bring these all
    together as a proof of principle even within this year. What we
    see is that by 2004 we will be again carrying this process
    along to be able to make incremental improvements, because a
    lot of what we do today is building upon and not starting anew.
        It is going to take a while as we bring a more
    comprehensive readiness assessment process together.
        Senator Akaka. Thank you very much, Dr. Mayberry.
        General Newbold, when you and your staff were coordinating
    forces to supply to General Franks, what role did Status of
    Resources and Training System (SORTS) reports or other
    readiness reporting data play in your decisions? If you did not
    rely primarily on these reports for indications of unit
    preparedness, what does this imply about their utility?
        General Newbold. Sir, the SORTS and other readiness
    reporting systems apply differently at a variety of different
    levels of command. At the lowest unit level, they have an
    immediate assessment value and importance.
        In the case of sourcing units for General Franks, the Joint
    Forces Command receives the requests for forces from us and
    distributes them based on information that would come out of
    SORTS. They would derive which units are the most ready and
    which units need more time to get ready, so readiness reporting
    systems like SORTS would be of value to them.
        On the Joint Staff, we use the same reporting systems in a
    supplemental way to that. We use it, for example, to make
    decisions on future procurement and the development of budgets.
    We also use it to identify specific weaknesses and stress
    against war plans and use that information to in make
    adjustments. In sourcing specific units, though, we rely on
    Joint Forces Command and the services to make sure that the
    units they send out are the most ready to fight.
        Senator Akaka. Thank you.
        Dr. Mayberry, your testimony notes the creation of a new
    working group to help clarify the relationship between funding
    and unit readiness, which just finished its first quarterly
    review of OPTEMPO funding. What were the results of that review
    and what milestones have been set for future actions by the
    working group?
        Dr. Mayberry. The Operations Readiness Working Group, or
    OPTEMPO working group, is something that we are working on in
    conjunction with the DOD Comptroller. We have initiated this
    effort to really improve our ability to resource as well as
    manage unit training and readiness.
        Each of the services have representatives on this group, as
    well as the Joint Staff and the defense agencies, as we all
    play a role in addressing training needs. The initiative has
    been chartered to develop a comprehensive approach to ensuring
    that our budgets and our programs adequately address the unit
    training requirements. We have just finished, as you said, our
    first quarterly review of the flying hours, steaming days, and
    tank mileage, including the dollars and execution. This
    promises to tighten the linkage between readiness and funding.
        That truly is an ongoing effort to make sure that we
    monitor the execution of dollars that we invest in unit
    training, as well as making sure that those result in the types
    of readinesses that we funded within those existing programs.
    So this is an ongoing and continuing effort, but we also will
    be addressing the metrics of OPTEMPO, seeking to make
    improvements by the end of this fiscal year as well.
        Senator Akaka. Thank you very much, Dr. Mayberry.
        Senator Inhofe.
        Senator Inhofe. Thank you, Mr. Chairman.
        One year ago, nobody believed anything like this could be
    happening today. We are in a different kind of war than we ever
    anticipated. It is very difficult to anticipate what is going
    to happen a year from now, 2 years from now, or 3 years from
    now.
        I would like to have you discuss the lessons you have
    learned, now that we are into something that nobody ever
    dreamed we would be in a year ago. I would also like you to
    address the capabilities needed to meet the challenges that
    come with this new war, specifically in terms of equipment,
    modernization, and endstrength.
        Dr. Mayberry.
        Dr. Mayberry. This is truly the first war of the 21st
    century, and I believe that this validates the past investments
    that this country has made in high-quality people and
    equipment. It also demonstrates our ability to adapt, create on
    the fly, and to operate in a strategic environment of
    uncertainty and surprise in Afghanistan.
        In my opinion, I think one of the primary lessons learned
    is that combat effectiveness is truly a result of our
    jointness. It brings capabilities and uniquenesses of each of
    the services together, and allows us to be greater than our
    individual parts.
        To be able to achieve the degree of jointness we have now
    in wartime requires that we build upon it in peacetime. We need
    to train the way we will fight.
        Afghanistan also represented, I think, a very expanded
    definition of jointness, not just the traditional notion of
    services working among themselves. It also reflects that this
    is a multinational coalitional type of fight. This will again
    be the wave of the future, the inter-agency piece, and the
    dynamic with other government organizations, as well as the
    interoperability continuing piece that we need to focus on
    within our military services. We saw soldiers on horseback
    calling in precision munitions. We have seen maritime forces
    operating hundreds of miles inland. We have seen old bombers
    delivering new weapons. We have seen unmanned vehicles not only
    delivering and gathering intelligence, but delivering a punch
    as well.
        All of those are the types of new concepts I think we are
    going to have to train to in the future. I think that we are
    going to have to build upon these concepts of jointness to be a
    critical part of individuals' careers throughout their service
    experiences as well as their joint assignments.
        Senator Inhofe. General Newbold, any comments on lessons
    learned from your perspective?
        General Newbold. Yes, Senator. Some of the lessons were
    relearned and some of them were predictable. The quantity of
    forces we had to fly to the Afghan theater required the same
    stresses and strains we would have used in another theater, and
    they came up with some of the same issues you have articulated:
    the strain on airlift; strain on ISR platforms; and the strain
    on some of the assets we knew that were in short supply, like
    intelligence analysts.
        These were predictable beforehand, and certainly were
    validated by what we have done over there. There were some
    surprises in my view, because the mission is truly global, and
    because of the requirements for the use of our military here in
    the United States. Our fundamental responsibility is protecting
    the United States and the Combat Air Patrols we have flown over
    the United States were essential, but were not as predictable
    in scope or scale as we are having right now.
        The assignment of National Guard and Reserve Forces has
    been critical, but not always as predictable. So there have
    been missions that were required which caused us to think in
    new ways. The use of unmanned aerial reconnaissance vehicles
    has played a critical role in what we have achieved.
        Dr. Mayberry has talked about individuals as well, like
    Special Forces, that have had a wonderful part to play, and did
    not achieve the same visibility as others, but have been
    critical to the success in Afghanistan. Frankly, the agility of
    the individual soldier, sailor, airman, and marine has been
    something we expected and has proven to be the decisive factor.
        Senator Inhofe. Secretary Rumsfeld said our priorities were
    wrong and we did not buy enough of what we needed. I think
    there is no way to predict in the future what our needs are
    going to be. When you talk about platforms, the V-22 technology
    comes to mind. I have worked on the V-22 issue since 1987, and
    I think of the tragedy that took place in a tough battle at
    high altitudes with the CH-47 helicopter and the loss of eight
    people.
        Would that have been a good place for that technology? If
    we had had that available, would that have been used in that
    environment?
        General Newbold. Sir, the V-22 fully developed and fielded
    would have been a wonderful platform because of what it brings.
    That is my view. We do not currently have the capabilities to
    operate at certain distances, and this would have benefited not
    only the marines, obviously, but also the United States Special
    Operations Command.
        Sir, a lot of the equipment of all the services has aged,
    and having a newly fielded system would have provided some
    sustainment that would have been good.
        Senator Inhofe. I think that is right. We could be talking
    about other platforms, too, and of course, the other services.
    We go through such a difficult time when we are trying to build
    new platforms. There is always criticism out there. We all
    lived through the C-17 and B-2 development criticisms, and both
    of them have performed well.
        Dr. Mayberry, my concern is about your statement that we
    are the best trained and equipped. I question if we are really
    the best equipped, because there are some things that we have
    that are not the best. For example, there are five countries
    that make a better artillery piece than our Paladin in terms of
    range and rapid fire.
        What I am hoping is that you and the service people on the
    next panel take those lessons learned and do as much as
    possible to make sure that 5-10 years from now, as well as
    today, service members going out to do the job have the very
    best. This goes for strike vehicles in the air, as well as
    artillery and such things as the V-22.
        Thank you very much.
        Senator Akaka. Thank you very much, Senator Inhofe.
        Senator Nelson.
        Senator Ben Nelson. Thank you very much, Mr. Chairman.
        I would like to thank both of the panels of witnesses for
    being here today. I appreciate your preparation to visit with
    us on the readiness of our Armed Forces. I appreciate very
    much, General Newbold, your comment about lessons learned and
    relearned, because that is clearly the important point that
    needs to be made. For us to be ready, we certainly have to have
    learned lessons from the past to project for the future.
        I think it is also important for us to recognize that for
    our services to be ready, they obviously need to have the
    resources necessary to meet the standards in personnel and
    equipment that are required. In order to continue to fight
    battles that we are faced with today, battles that 6 or 7
    months ago we could not have predicted exactly how they would
    play out, we have to be prepared.
        Based on the testimony that I heard yesterday, we have
    flown over 19,000 domestic sorties since September 11 and over
    20,000 sorties in Afghanistan. I think these are astounding
    statistics, given the fact that the airframes being flown are
    19 years old. Many are way beyond their retirement years, but
    they certainly stood up. I would also like to commend the
    quality of the soldiers, sailors, airmen, and marines who were
    engaged in these activities. I certainly want to stress that it
    appears from all indications we were ready.
        In February, I had the privilege of visiting our troops in
    Afghanistan, Uzbekistan, and Pakistan. Clearly, our troops have
    done a significant amount of work in a short period of time. I
    am pleased to point out that from my experience troop morale
    was high. They believe that what they are engaged in is the
    right action and that they are very strongly supportive and
    appreciate the American people's support and the friends that
    we have developed worldwide in this process.
        Given the significant effort of troop deployment in such a
    short period of time, it seems that we should say we were
    ready. There is no hook in this worm. I am not building up to
    let you down.
        There was a concern raised regarding rotation, certainly
    among those who are there on a temporary basis coming from
    Reserve or from Guard units. While I understand that the
    Central Command has a 179-day rotation period for nearly all
    the troops in the region, the question is, has that policy been
    adequately communicated to our troops there? There seemed to be
    some question as to whether or not there was a policy and while
    they had heard about a policy, it had not been communicated
    directly to them.
        The only question about readiness I think is about the
    ability to rotate troops in order to continue to have the
    freshest troops available for the battles that are ongoing and
    that may be in the future. We recognize that the war is not
    over in Afghanistan, it is certainly not over against al Qaeda,
    and it is not over against terrorism at large.
        Can we do a better job of communicating with our troops
    about readiness and are we able to redeploy fresh troops? Are
    we going to have to rely on troops that are there 12 hours on,
    12 hours off, 7 days a week?
        General Newbold. Yes, sir. It is a good question. The
    soldiers, sailors, airmen, and marines can sustain almost
    anything as long as they know what the policy is and that there
    is predictability. It really is an excellent point. Central
    Command does not have a formal rotation policy that they impose
    on their components. Three of the components have a 179-day
    policy, one of them has a 90-day policy. Some of the forces are
    rotating out--I could get into specifics if you like, sir--
    because they are pushed very hard.
        It applies in Afghanistan. It applies elsewhere in the
    Central Command area of operation. It applies to the Military
    Police guarding places around Washington, DC, who work long
    shifts. All of them deserve to know how long they will be doing
    it so they can adjust mentally to a predictable life pattern.
    That has been communicated, sir, and it will be done. They all
    need to know that and they will, sir.
        Senator Ben Nelson. I think you also made the point that if
    we know something we can almost always adjust to it. If there
    is certainty in their minds, that is better than the
    uncertainty of something that just seems to be the indefinite
    game, sort of like the movie ``Groundhog Day.'' There was no
    low morale related to it, but there was a question, and
    questions unanswered can ultimately affect morale. So that was
    why I was concerned.
        I appreciate very much your attention. I have raised it on
    previous occasions, but I think it is important to be able to
    stress to the troops there is a plan and we are going to try to
    meet it.
        Thank you.
        Thank you, Mr. Chairman.
        Senator Akaka. I want to thank Dr. Mayberry and General
    Newbold for your statements. We will talk to you later in a
    closed session today.
        Let us move to our second panel.
        Dr. Mayberry. Thank you very much, Mr. Chairman.
        Senator Akaka. This panel includes operations deputies from
    each of the four services: Lieutenant General McKiernan, the
    Deputy Chief of Staff, G-3/5, for the Army; Lieutenant General
    Emil Bedard, the Deputy Commandant of the Marine Corps for
    Plans, Policies, and Operations; Lieutenant General Wald, the
    Deputy Chief of Staff of the Air Force for Air and Space
    Operations; and Rear Admiral Krol, Assistant Deputy Chief of
    Naval Operations for Plans, Policies, and Operations. I would
    like to welcome them, as well as students from Oklahoma and
    from the island of Molokai, Hawaii, who are in our audience
    today.
        Thank you all for being here today. As the senior
    representatives from each of your services who are tasked with
    delivering trained and ready forces to our regional commanders,
    you all are uniquely suited to give us some insight into
    current and future readiness challenges. We look forward to
    your testimony.
        Let me say that we will include all of your statements in
    the record, but because we are pressed for time please be as
    brief as you can to summarize your remarks.
        General McKiernan.

    STATEMENT OF LT. GEN. DAVID D. McKIERNAN, USA, DEPUTY CHIEF OF
                  STAFF, G-3/5 (OPERATIONS AND PLANS)

        General McKiernan. Thank you, sir. Mr. Chairman and Senator
    Inhofe, I am honored to be here today and be able to report to
    you that our Army is trained and ready.
        Let me first thank you for your sentiments on the tragic
    artillery incident yesterday at Fort Drum, New York, where
    several soldiers were injured and two have deceased at this
    point. I would tell you that our Army Safety Center is on the
    ground up there conducting a thorough investigation into the
    cause of that incident, and we will report back to you once we
    find out that information.
        On behalf of our soldiers and civilians, I would also like
    to express our deep appreciation for everything that you have
    done this past year. You have improved pay and benefits,
    enhanced quality of life, and provided the resources to ensure
    a trained and ready force that is second to none.
        As our fighting men and women continue to make incredible
    sacrifices, they look to us to demonstrate the Nation's
    appreciation and commitment to them and their families. It is a
    commitment that you have honored well, and they are grateful.
        There is no doubt that we are an Army at war. As we sit
    here today, over 200,000 soldiers are forward stationed or
    deployed around the world on contingency operations defending
    freedom and American ideals. Even before September 11, the Army
    was very much engaged in doing the Nation's business on a full
    spectrum of missions around the globe. Sometimes it is easy to
    forget that our soldiers have been on the ground keeping the
    peace in the Balkans for 6 years, in Saudi Arabia and Kuwait
    for 11 years, and in the Sinai for 19 years. Our soldiers have
    been in Europe and Korea for over 50 years, ensuring peace and
    stability, while at the same time providing the Nation with a
    rapid deployment capability to potential trouble spots near
    those theaters of operation.
        Since the attacks, the Army's mission profile has expanded
    even further. Over 27,000 Guard and Reserve soldiers have been
    mobilized for Federal service. At home, the Army has continued
    its long tradition of support to homeland security. Almost
    11,000 soldiers are on duty, patrolling our borders, securing
    our critical infrastructure sites, and serving at Ground Zero
    in New York City alongside U.S. Army Corps of Engineers.
        We have now certified 27 weapons of mass destruction civil
    support teams, which have trained over 28,000 civilian first
    responders in 105 cities. Throughout the anthrax crisis, the
    Army has provided critical expertise and deployed chemical and
    biological defense elements to protect key assets.
    Additionally, the Army has responded to dozens of requests for
    support from civilian authorities with unique capabilities and
    thousands of soldiers.
        Abroad, our Army has been at the forefront of the global
    war on terrorism. Today, there are over 17,000 soldiers in the
    U.S. Central Command area of operations. In Afghanistan, Army
    special operators teamed with anti-Taliban conventional forces
    to compel the enemy to mass so that the significant
    capabilities of our air-delivered munitions could be brought to
    bear.
        More recently, in the harsh Shahikot region Operation
    Anaconda has demonstrated the enduring value of land power in a
    tough, close-in fight. These victories were not accidental, nor
    were they easily won. They represent a commitment to high
    standards, hard work, and superior training, honed by real-
    world experience in places like Bosnia, Kosovo, Kuwait, our
    combat training centers, and many other mission sets.
        Mr. Chairman, we are winning a conflict that few foresaw or
    predicted a year ago. But it should be recognized that this
    places a certain degree of stress on the force. Our new century
    is marked by uncertainty and it is difficult to predict where
    and when we will be needed next. All we know is that it will
    happen, and our Army will need to maintain full spectrum
    capabilities.
        In the past decade, the number of Army deployments has
    increased by 500 percent. Our soldiers, civilians, and families
    willingly accept this challenge. That is why we are here, to do
    America's heavy lifting so that we as a Nation can continue to
    enjoy the freedoms we all hold so dear.
        Because the Army operates in the domain of human conflict,
    it is no surprise that people are our centerpiece in our
    formations. Every day they represent America to people around
    the world. Whether deployed or training, supporting or
    shooting, Active component or Reserve, they demonstrate the
    best that America has to offer on a daily basis.
        They take on our risks and go into harm's way. Some shed
    their blood, and some that we have recently buried at Arlington
    Cemetery have made the ultimate sacrifice. Through all this,
    their determination and resolve is not only unbowed, but
    strengthened. Allow me to quote Sergeant Michael Ericson of the
    101st Air Assault Division, whose message to the enemy was
    clear and succinct, and I think probably echoes our feelings
    here today: ``Don't sneak into my back yard and bomb me and
    then expect me not to come after you, because we're coming.
    We're coming.''
        I am here today to answer your questions concerning the
    Army's readiness. The fiscal year 2003 budget you are
    considering supports the Army's critical needs in the near-
    term. Our priorities remain unchanged. First, we are dedicated
    to winning the current fight; in this we shall not fail.
    Second, we must continue to prepare for the next fight,
    whenever and wherever that occurs. This means maintaining the
    momentum of transformation and making the tough choices between
    current and future readiness. Third, we are committed to being
    effective stewards of the resources provided by you that are
    required to accomplish the first two priorities.
        Thank you very much for having me here today and I look
    forward to your questions.
        [The prepared statement of General McKiernan follows:]

             Prepared Statement by Lt. Gen. David D. McKiernan, USA

        Mr. Chairman and distinguished members of the subcommittee, thank
    you for this opportunity to report to you on the United States Army's
    readiness to provide for our Nation's security today and in the future.
    Our Nation and the Army have a great and common heritage. Throughout
    our Nation's history, the Army has continually demonstrated that it is
    America's decisive ground combat force able to perform full spectrum
    operations anytime, anywhere, under any condition, and as we have
    recently shown in Afghanistan, against any enemy.
        We are a Nation at war. Nowhere has the Army's ability to conduct
    full spectrum operations been more evident than in Operations Enduring
    Freedom and Noble Eagle. Today, as I appear before you to discuss Army
    operations and readiness, soldiers--Active and Reserve component--are
    forward stationed and deployed around the globe, performing
    magnificently as they fight the war on terrorism and defend our
    homeland. In the months since the attacks of September 11, Army Special
    Forces working in conjunction with other special operations forces, our
    joint partners, and forces of the Northern Alliance, ran Taliban and al
    Qaeda forces from power in Afghanistan. Most recently, during Operation
    Anaconda, soldiers from the 101st Air Assault Division and the 10th
    Mountain Division, along with Afghan forces and air support from our
    sister services, closed with and destroyed Taliban and al Qaeda forces
    in close combat.
        At home, our support for Operation Noble Eagle has enhanced the
    safety and security of millions of Americans. From chemical and
    biological detection teams working in Washington, DC, to the Corps of
    Engineer's tremendous efforts at Ground Zero in New York, to the
    thousands of soldiers protecting critical infrastructure and providing
    peace-of-mind to passengers at America's airports, the Army--Active,
    National Guard, Reserve, and civilians--has been, and will continue to
    be, present for duty.
        Although filled with pride at our ability to serve the Nation, the
    Army harbors no illusion about the challenges it faces. To help win the
    global war on terrorism and prepare for future wars and conflicts, the
    Army must effectively use the resources you provide us to transform.
    With the continued support of Congress and the Administration, our
    soldiers will continue to do their part to help America win the current
    war, protect the homeland, support our friends and allies, rapidly
    transform the Army to fight and win future conflicts, and maintain our
    readiness for the unexpected and unpredictable challenges that lie
    ahead.
        The attacks of September 11 demonstrate that the world remains a
    very dangerous and unpredictable place. One thing, however, is clear:
    America and her interests are now and will continue to be under attack
    from a myriad of threats for the foreseeable future. Moreover, our
    soldiers will continue to be involved in smaller-scale contingencies
    around the globe, but will never be far removed from the potential for
    large-scale conventional combat operations.
        Recent operations at home and abroad reaffirm with absolute clarity
    and certainty the enduring value of ground forces. Specifically, the
    value of soldiers, operating in a joint and usually combined
    environment, capable of creating an imposing physical and materiel
    presence, ready to search a cave or destroy an armor column, willing to
    guard an outpost or provide humanitarian assistance, has never been
    more apparent than it is today. To ensure decisive victory across the
    spectrum of conflict, our soldiers must be capable of prompt and
    sustained land operations against any and all enemies in any and all
    environments. We are fighting today, and through the transformation of
    our force we will be prepared to fight on different battlefields
    against new and different enemies in the future.

                               A NEW ENVIRONMENT

        The 2001 Quadrennial Defense Review (QDR) established a new
    strategic framework for the defense of the Nation that struck a balance
    between near-term readiness and the Army's ability to transform to meet
    the requirements of current and future conflicts. The report delineated
    a balanced assessment of our near-term warfighting needs. It moved away
    from the need to fight and win in two major theaters of war nearly
    simultaneously and articulated a new operational concept that gives
    continued priority to homeland defense, promotes deterrence through
    forward presence, and asks that we maintain the ability to conduct both
    smaller-scale contingencies and large scale high-intensity combat
    operations simultaneously. As the Army works with the Department of
    Defense and the other services to further define the emerging
    requirements outlined in the 2001 QDR, we anticipate that some elements
    of current operations will become part of our new posture and emerge as
    additional force structure requirements for which we may need more
    resources. We expect that other elements, such as airport security and
    support to the Border Patrol, Immigration and Naturalization Service,
    and Customs Agency will eventually conclude.
        As we have demonstrated previously in Panama, the Gulf, Haiti,
    Bosnia, Kosovo, and more recently in Afghanistan, soldiers can defeat
    enemy armies, seize and control terrain, and control populations and
    resources with minimal collateral casualties and damage. They can
    operate across the spectrum of military operations, from full-scale
    conventional conflicts to asymmetric conditions, from fighting
    terrorists to setting the conditions for humanitarian assistance. In an
    era of precision weapons, nothing is more precise and discriminating
    than the U.S. Army soldier.
        It is important to note that wherever the Army goes, it usually
    stays. Theater support to regional Commanders in Chief, major combat
    operations, smaller-scale contingencies, and post-hostilities
    activities all take their toll. The U.S. Army has been in Europe for
    almost 58 years, in Korea for 52 years, in the Sinai for 19 years, in
    the Persian Gulf for 12 years, in Bosnia for 6 years, and in Kosovo for
    nearly 3 years. Despite 10 years of downsizing, that saw a 33 percent
    reduction in military personnel including the loss of 37 percent of the
    Active-Duty Force and a 44 percent decrease in civilian personnel, the
    Army has accomplished all missions to the highest standards. Even
    before September 11, 2001, we were doing more with less, and the strain
    on the force was real. Since then, our mission profile has grown.
    Thankfully, our soldiers, imbued with an ethos of service to the
    Nation, continue to give us more in operational readiness than we have
    resourced.
        The Army has plans to alleviate some of this strain as we continue
    to prosecute the war on terrorism at home and abroad. To address the
    disparity between our mission profile and our resources, we will grow
    our endstrength by no more than a modest 1 to 2 percent this year. This
    number, something approaching 4,000 to 5,000, is well within
    congressional authorizations. Moreover, given our strong performance in
    recruiting the last 2 years, it represents an achievable objective to
    relieve some of the strain on our force.

                       SOLDIERS--ON POINT FOR THE NATION

        Around the world, Army soldiers reassure our allies, build trust
    and confidence, restore and promote regional stability, encourage
    democratic reforms, and deter conflict. Operating as part of a joint
    military team, the Army provides our leaders and commanders with a wide
    range of capabilities. Our core competency of deliberate and crisis
    action planning, that begins with the five paragraph field order we
    teach to junior officers and non-commissioned officers and culminates
    with the theater campaign planning process we teach our senior leaders,
    provides the Army, various CINCs, and the Joint Staff with a nearly
    unique ability to match warfighting resources to objectives. Our
    unparalleled theater-opening capability sets the conditions for the
    rest of the joint force to follow and provides theater-level support to
    the commander. In the conflict in Afghanistan, Army expertise in long-
    range communications and theater logistics, as well as force protection
    for airfields and other assets, established the proper foundation upon
    which to build our joint forces. Ultimately, the Army, with both
    conventional and unconventional capabilities, closed with and destroyed
    a very determined enemy. It is important to remember that neither
    weather, altitude, nor terrain dissuades those capabilities that the
    Army brings to the fight. As we have seen in today's conflict, we
    cannot win without the human dimension on the battlefield. Be it
    gathering intelligence, challenging an adversary's ability to hide,
    protecting innocent civilians, searching a cave, or battling the enemy,
    it is the inherent flexibility of the soldier on the ground that
    provides commanders the ability to decisively defeat our foes. During
    combat operations, the American soldier remains the ultimate arbiter of
    victory.

                            ON DUTY AROUND THE GLOBE

        Today, the Army--active, ARNG, and USAR--has over 124,000 soldiers
    and 38,000 civilians forward stationed in 110 countries around the
    world. On any given day last year, over 27,500 soldiers were deployed
    to 60 countries for operations and training missions. Currently, as the
    war on terrorism expands, there are more than 58,000 soldiers deployed
    around the globe serving America's interests.

                           OPERATION ENDURING FREEDOM

        The Army fully embraces its role in the global war on terrorism. As
    part of Operation Enduring Freedom, there are over 16,000 soldiers
    deployed to the CENTCOM AOR from Egypt to Pakistan, Kenya to
    Kazakhstan, including nearly 5,000 in Afghanistan. These conventional
    and special operations soldiers from all three components--Active, Army
    National Guard, and the Army Reserve--are conducting a myriad of
    critical tasks. From advising local tribal leaders to designating
    targets, from securing airfields to providing logistics, from calling
    in fire to flying transport helicopters at night under adverse
    conditions to climbing mountains to attack enemy positions and
    providing close air support with Apache helicopters time and time again
    while under heavy fire, our soldiers, fighting alongside members of the
    other services and our allies, have seized the initiative, met every
    challenge head on, and vanquished every foe.
        Similarly, in the Philippines, Army forces have joined with other
    joint forces in advising the Armed Forces of the Philippines (AFP) on
    their efforts to root-out terrorism in their country. In addition to
    logistical support elements, Army Special Operations Forces are working
    alongside special operators from other services in their work with the
    AFP. Due to our unique training program that aligns regional expertise
    with training and warfighting skills, our Special Forces are
    particularly well positioned to support JTF-510 and, in fact, make up
    over a third of that joint force.

                             OPERATION NOBLE EAGLE

        At home, in addition to the nearly 12,000 Reserve component
    personnel that are supporting Operation Enduring Freedom, the Army is
    providing 25,000 soldiers to support Operation Noble Eagle, the war on
    terrorism in the United States. The vast majority of those soldiers are
    also from the Reserve component. A great many of those soldiers are
    guarding critical elements of our Nation's infrastructure--power
    plants, dams, tunnels, bridges, water sources, command and control
    facilities, and even the Capitol building. Perhaps most noticeable and
    familiar are the 6,500 soldiers providing security and assisting local
    officials at 441 airports across the country.
        Not counted in that number are the 4,000 soldiers that provided
    force protection, explosive ordnance expertise, personnel and equipment
    screening, and helicopter support to the Winter Olympics. Soldiers are
    still in Utah providing similar support to the Paraolympic Games.
    Soldiers ensured that this National Security Special Event (NSSE)--like
    the Super Bowl and many others before it--occurred without incident.
        Most recently, the Army has provided over 1,500 soldiers to the
    Border Patrol, Immigration and Naturalization Service, and Customs
    Service to assist them in their duties in 13 border states. Less
    noticeable, but no less important, are the other smaller groups of
    soldiers and civilians, many with specialized expertise, that provided
    linguistics support, chemical and biological forensics analysis, HAZMAT
    training and assistance, biological detection capability, weapons of
    mass destruction civil support team training for 26 teams in 25 States,
    and technical escort services to several key facilities including the
    Capitol complex.

                                 ARMY READINESS

        The Army has demonstrated its high state of readiness. This is
    largely due to the sustained support from the Nation, Congress, and the
    administration. We have a non-negotiable contract with you and the
    American people to fight and win our Nation's wars--decisively. As our
    mission profile expands, we will require your strong support to ensure
    our continued readiness and ability to meet the terms of that contract.
    The fiscal year 2003 budget request supports our readiness and provides
    funding to maintain our current facilities at an acceptable level.
    Fiscal year 2003 funding improves on fiscal year 2002 levels in terms
    of maintaining a stable training base to develop quality leaders and
    soldiers. The Army has funded its top priorities. Resources have been
    aligned to ensure our forces are trained, equipped, and ready to fight.
    In addition, funding is provided to enhance unit training and
    deployability, another positive element of overall readiness. Finally,
    while this budget advances the Army's campaign plan to transform the
    force for the future, concerns remain in some areas, including
    recapitalization, depot level maintenance, munitions, Active and
    Reserve component manning, acceleration of transformation, and
    destruction of our chemical stockpiles.

                          IMPACT OF CURRENT OPERATIONS

        Our current operations in Afghanistan and elsewhere have provided
    the Army with several lessons. The first lesson is that our training
    program works and we must continue to fund training and training
    resources, to include the expansion of our range capacity. The Army
    OPTEMPO budget is a top priority. Although currently funded at
    approximately 97 percent, the Army plans to execute a full ground
    OPTEMPO program of 800 M1 Abrams Tank miles at home station and a
    complete Flying Hour Program of an average of 14.5 live flying hours
    per aircrew per month for the Active component, and nine live aircrew
    hours for Reserve components. As the skill of our Apache pilots in
    battle in Afghanistan attests, the quality of our pilot training
    program, not to mention the quality of our airframes, is one of the
    jewels in our crown. We must ensure we continue to train to standard.
        We have scheduled 10 brigade rotations (9 Active component and 1
    Army National Guard) through the National Training Center at Fort
    Irwin, California, and 10 brigade rotations (9 Active component and 1
    Army National Guard) through the Joint Readiness Training Center at
    Fort Polk, Louisiana. The Battle Command Training Program headquartered
    at Fort Leavenworth, Kansas, will conduct two corps warfighter
    exercises and train six division command and staff groups, an increase
    of one divisional staff training exercise in fiscal year 2003.
    Additionally, funding for training enabler support has been increased
    20 percent from fiscal year 2002 levels.
        Tough, demanding training supported by an infrastructure that
    allows us to train, sustain, and deploy is essential to readiness.
    History has shown that the higher the quality of training, the better
    the leaders and warfighters we produce. We must fully modernize
    training ranges, combat training centers, and training aids, devices,
    simulators, and simulations to provide adequate and challenging
    training. In addition to live field training, the Army has funded the
    integration of virtual and constructive training capabilities. Yet,
    despite all the advantages of virtual and constructive training we
    expect to gain, there is no substitute for training in the field. As
    the quality of our forces, our equipment, and our network-centric
    command and control operations continue to advance our forces will
    operate with ever-greater dispersion. Maintaining sufficient maneuver
    areas for training these extended formations will become even more
    critical. Those areas are increasingly being encroached upon,
    intensifying environmental constraints and operational limitations that
    place unnecessary limits on testing and training facilities. The Army
    is one of the best stewards of the environment. To improve on our
    stewardship, we are implementing a sustainable program that integrates
    operational needs, land management, explosives safety, and
    environmental concerns into the lifecycle management of our ranges.
        The second lesson from Operations Enduring Freedom and Noble Eagle
    is that we have outstanding Reserve component forces, but our
    mobilization of those forces is still cumbersome and takes too long
    despite advances since Operation Desert Storm. Our goal is to rapidly
    transition soldiers to Active Duty while ensuring that they have
    sufficient time to prepare at home station for extended absences.
    Adequate Full-Time Manning and Military Occupational Skill (MOS)-
    qualified Reserve component soldiers are key to setting the right pre-
    mobilization conditions.
        The third lesson, and one we have learned before, is that our
    forces are ready to fight when they arrive, but we must continue to
    work with the Air Force and Navy as well as the Joint Staff and
    TRANSCOM to ensure that they arrive in theater faster. The Army fully
    supports continued purchase of C-17 aircraft and fast sealift to ensure
    the joint force can get us to where the Nation needs us, when it needs
    us.
        The fourth lesson is that the war in Afghanistan reinforces the
    Army's transformation efforts and demonstrates a clear need to
    accelerate both the fielding of the Interim Brigade Combat Teams
    (IBCTs) and the Objective Force. These capabilities are needed on
    today's battlefield and would have had a significant impact on the
    conduct of the battles fought to date. Fielding the lighter and more
    lethal IBCT and Objective Force also reduces the requirement for lift.
        The extent, duration, and variety of current and potential future
    operations, however, have presented us with some challenges. As
    necessary and beneficial as it is to have soldiers on the ground
    creating a presence and furthering the Nation's interests in a variety
    of combat and non-combat operations, there comes a point where the
    force is stretched beyond what seems prudent. The Secretary of Defense
    is examining the Nation's role on the multinational observer force in
    the Sinai. We support his efforts, but will stand our post until
    properly relieved.
        Others have questioned why American ground forces remain in the
    Balkans. Perhaps at some point, it will be prudent to turn that mission
    over completely to our European friends and allies. However, today and
    for the foreseeable future, it is the American flag and the presence of
    American soldiers that in large measure brings stability to the region.
    Moreover, those same forces are performing several critical tasks in
    support of our global war on terrorism. Specifically, they are
    conducting surveillance and collecting intelligence on suspected
    terrorists who are known to be active in the area and when directed are
    supporting the interdiction and arrest of these individuals. To
    withdraw completely and immediately would not only risk a return to
    instability, but also significantly reduce our counter-terrorism
    efforts.
        Finally, the Army does not think short-term. As this century has
    shown, the Army not only wins wars, but it also bears the preponderance
    of the responsibility for post-hostility operations. We fully
    anticipate that beyond the destruction or surrender of our enemies, the
    Army will be present to conduct a series of post-hostilities and non-
    combat operations that solidify the hard-fought gains of battle.
        Another area in which the extent, duration, and variety of
    operations may pose a challenge is the service and support of our
    combat forces. The likelihood for multiple, non-linear, distributed,
    and possibly overlapping operations around the globe has the potential
    to further exacerbate existing shortfalls in our combat service support
    forces. With 70 percent of our combat service support coming from a
    Reserve component that is already beginning to feel the strain of
    supporting the war on terrorism, it may be necessary to develop a way
    to bridge the gap. Additional support for Full Time Manning, enhanced
    recruiting and retention, and purchase of necessary equipment and
    repair parts would help to improve readiness in those units.
        The Army is ready, and one element of readiness we have been
    working hard to improve is our reporting system. Our current system is
    based on lagging indicators, and while satisfactory, it does not
    provide senior leaders with the ability to influence readiness in a
    proactive manner. Our new Strategic Readiness System (SRS) will
    leverage information available through existing reporting systems while
    providing a more objective, scalable, and timely measure of the Army
    across all its domains (operating force, institutional force, and
    infrastructure). Initial prototyping was completed last year, and we
    are currently finalizing our measures of merit with field testing and
    initial integration at selected installations scheduled for this year.

                                 TRANSFORMATION

        Transformation is about changing the way the Army thinks, trains,
    and fights in order to win the Nation's wars in a dominating and
    decisive manner. It is inextricably linked to the readiness of our
    forces. The emerging character of 21st century warfare clearly
    highlights the need for Army transformation; the strategic environment
    demands that we accelerate it. The goal of transformation is to see
    first, understand first, act first, and finish decisively by leveraging
    technology to gain greater situational awareness of the battlefield
    than our opponents. With superior awareness, soldiers and leaders can
    understand first and devise appropriate strategies for dealing with the
    enemy. Through the advent of information dominance and network-centric
    operations, the Army will act first to seize and retain the initiative,
    attacking the enemy where he is weak while protecting our
    vulnerabilities, and using rapid maneuver and precision fires to defeat
    our adversaries decisively.
        Military institutions are often criticized for looking backward and
    preparing for the last war instead of looking forward and preparing for
    new and emerging dangers. With the Army's transformation, nothing could
    be further from the truth. Our transformation is based on a decade's
    worth of self-study and examination that began in the early 1990s with
    simulation studies at our battle labs that were field-tested in
    Advanced Warfighting Experiments at Fort Hood, Texas, as well as at the
    National Training and the Joint Readiness Training Centers.
        To understand Transformation is to understand that the Army is
    undertaking a holistic and monumental change while simultaneously never
    wavering from its mission to be ready to fight and win the Nation's
    wars. We are changing our doctrine, training, leader development,
    organization, materiel, and soldier systems across the Active
    component, the Army National Guard, and the Army Reserve.
    Transformation will result in a different Army, not just a modernized
    version of the Army that won the last war. Combining the best
    characteristics of each element in our current force, the transformed
    Army will possess the rapid deployment mentality and toughness of our
    light forces, the lethality and speed of our heavy forces, and the
    unmatched precision and combat capabilities of our special operations
    forces. Transformation will field the best, most combat effective, most
    lethal soldier and organization in the world.
        The Army, like all of our joint partners and the Department of
    Defense, is a large enterprise. Change on the magnitude envisioned with
    Army transformation does not happen quickly, nor is it safe to change
    everything at once. This is particularly so when the Army and the
    Nation are fully engaged protecting citizens at home and fighting
    terrorism on multiple fronts abroad. In order to facilitate change,
    while simultaneously remaining ready to defend America's interests, the
    Army designed its transformation plan with three interrelated
    elements--the Objective Force, our main effort this decade; the Interim
    Force, our near-term operational bridge between our existing heavy and
    light forces; and the Legacy Force, our immediate warfighting
    capability to ensure the continued safety of the American people and
    the continued security of American interests.

                              THE OBJECTIVE FORCE

        The Objective Force breaks the mold. Instead of the linear,
    sequential operations of the past designed to overpower an enemy with
    sheer weight and volume, the Objective Force will fight in a
    distributed, non-contiguous, and network-centric manner oriented on
    physically and psychologically disorienting, disarming, and decisively
    defeating any foe in any environment. The speed, stealth, and advanced
    sensor-to-shooter technology planned for the Comanche helicopter
    characterize the capabilities necessary for this new form of combat.
    Reduced platform weight and a smaller logistical footprint will permit
    Objective Force units to deploy more rapidly than today's Legacy Force.
    Able to conduct vertical maneuver and execute anti-access operations,
    these forces will descend upon multiple enemy points of vulnerability
    and through superior situational awareness, identify and attack
    critical enemy capabilities throughout the depth of the battlefield. To
    ensure we have maximized our opportunity for success in fielding the
    Objective Force as quickly as possible, the Army invested 97 percent of
    our fiscal year 2003 science and technology budget toward the design
    and development of the Objective Force and enabling technologies. We
    have recently selected our Future Combat System Lead Systems Integrator
    and with your continued support will begin fielding the Objective Force
    before the end of the decade.

                                 INTERIM FORCE

        The Interim Force is the Army's transition force designed to bridge
    the near-term gap between the capabilities of our heavy and light
    forces. It blends the best characteristics of our heavy, light, and
    special operations forces into a medium weight, full spectrum force
    with increased operational and tactical flexibility. Organized into
    Interim Brigade Combat Teams (IBCTs), it leverages today's technology
    with selected Legacy Force capabilities to serve as a link to the
    Objective Force. A combat ready force, the Interim Force will allow
    exploration of new concepts relevant to the Objective Force. The Army
    currently plans to field six of these new, more agile and responsive
    combat teams. The first two IBCTs are organized at Fort Lewis,
    Washington and are undergoing extensive training in all environments,
    including urban and restrictive terrain. The first of these brigades
    will attain its first incremental warfighting capability--an infantry
    company--in August 2002 with its full initial operational capability
    shortly thereafter in May 2003. Follow-on fieldings are planned for
    Alaska, Louisiana, Hawaii, and Pennsylvania. Moreover, the Department
    of Defense has asked us to examine stationing an IBCT in Europe. Very
    soon, the IBCT will be an immensely responsive, highly deployable, and
    increasingly lethal operational reality ready for combat operations in
    support of our joint commanders worldwide.

                                  LEGACY FORCE

        The Legacy Force is the guarantor of the Army's immediate
    warfighting readiness. Through selective recapitalization and
    modernization, the Legacy Force enables the Army to meet today's
    challenges, while providing the time and flexibility to complete our
    Transformation--effectively managing risk without sacrificing
    readiness. Through our Prioritized Recapitalization Program, the Army
    has identified and fully funded the refurbishment of 17 systems in
    selected units. These systems include the AH-64 Apache, UH-60 Black
    Hawk, and CH-47 Chinook helicopters that were so important during
    Operation Anaconda; the M1 Abrams tank and M2 Bradley fighting vehicle
    that dominated the deserts of Iraq a decade ago and that combine the
    best of shock and firepower today; and the Patriot Advanced Capability-
    3 missile defense system, a significant upgrade from the system that
    saved many a soldier in Operation Desert Storm and that is guarding the
    frontiers of freedom in Korea and Kuwait today.
        Modernization of this force links it to the Interim and Objective
    Forces. The Crusader self-propelled howitzer will solve a current
    shortfall in fire support and provide our soldiers the ability to call
    for the best fire support available anywhere. Additionally, Crusader
    robotics and other advanced technologies will inform the continued
    development of the Objective Force. Although after fiscal year 2003 the
    Army will not buy another heavy tank, the modernization of our M1/A2
    SEP tanks and M2/A3 Bradley fighting vehicles retains our present
    ability to defeat any adversary while training soldiers on the same
    network-centric situational awareness skills necessary in the Interim
    Force. Army Aviation modernization will further enhance our current
    readiness by reducing our helicopter inventory by 25 percent while
    returning savings in training and logistics that will be used to
    recapitalize the remainder of the fleet. To support these and other
    priorities, the Army terminated 18 systems and restructured another 12
    in this budget cycle.

                THE ARMY--PERSUASIVE IN PEACE, INVINCIBLE IN WAR

        The Army is trained and ready and wholly dedicated to preserving
    freedom and defending American interests at home and abroad. As we have
    done many times over the last two centuries, and are doing today in
    Afghanistan, the Philippines, the Balkans, the Middle East, and
    countless other places around the globe, the Army will continue to win
    the Nation's wars and serve its interests. The United States Army--
    Active, Army National Guard, and Reserve--is the most respected ground
    combat force in the world. Our current training and readiness programs
    along with the Army's transformation will ensure we remain the world's
    most respected force now and in the future. Today's emerging security
    requirements, particularly since the attacks of September 11 have
    intensified the demands we place on the backs of our young men and
    women. Defending freedom abroad and securing the homeland, while
    preparing for potential near-term contingencies has increased the
    competition for scarce resources and reduced our ability to invest in
    people, systems, platforms, and research and development. Unless
    redressed, risks incurred from this resource shortfall could undermine
    the Army's ability to adequately satisfy evolving national security
    requirements. These same requirements call evermore loudly and urgently
    for an acceleration of the Army's transformation. No one can predict
    what the future holds, but what is certain is that our Nation must have
    the best trained, best led, and best equipped soldiers on the ground,
    capable of deploying rapidly at precisely the right time to the right
    place and with the right support structure to influence conditions and
    achieve victory as part of the joint military team.
        Mr. Chairman and distinguished members of the subcommittee, thank
    you for your continued support of the Army, transformation, and most
    importantly, our soldiers. Over 2 years ago, we joined together and
    began this effort committed to ensuring that the Army remains dominant
    today and prepares for combat in the future. The magnitude of what we
    have accomplished together is staggering. Our actions in Afghanistan
    and elsewhere have demonstrated with absolute clarity the enduring
    value of Army ground forces. Your continued support will ensure those
    forces remain the most valued and most respected in the world. Thank
    you again for this opportunity to report to you on the readiness of
    your Army. I look forward to discussing these issues with you.

        Senator Akaka. Thank you very much for being brief. I just
    want to remind you again that your full statements will be
    placed in the record, and ask you to continue to summarize your
    statements.
        Admiral Krol.

      STATEMENT OF REAR ADM. JOSEPH J. KROL, JR., USN, ASSISTANT
        DEPUTY CHIEF OF NAVAL OPERATIONS FOR PLANS, POLICY, AND
                 OPERATIONS, CHIEF OF NAVAL OPERATIONS

        Admiral Krol. Mr. Chairman, Senator Inhofe, and Senator
    Nelson, I want to thank you for the opportunity to be with you
    today. It is certainly a privilege to report on the status of
    our great Navy. I thank you for your continuing support of our
    fleet and sailors.
        Because readiness is at the top of our agenda, September 11
    found the Navy well-equipped, superbly trained, and forward
    deployed to conduct prompt and sustained combat operations. The
    day after the attacks on our Nation, 2 carrier battle groups,
    25 ships, 177 aircraft, and 18,000 members of the Navy-Marine
    Corps team were on station in the northern Arabian Sea.
        The Navy's contributions to the global war on terrorism
    have highlighted the value of projecting force deep inland from
    the sovereign and secure operational base provided by naval
    combatants. The Navy's response at home to the attacks on New
    York City and the Pentagon were uniquely indicative of our
    culture of readiness.
        The tempo of deployed surface ships has increased 50
    percent during Operation Enduring Freedom, and flying hours
    have been up over 100 percent at their peak. However, thanks to
    strong Navy leadership and the support of this subcommittee,
    the high operational pace has not significantly degraded
    readiness. Key metrics such as aircraft cannibalization rates,
    material casualty reports, and personnel readiness are stable,
    and number of deployed units reporting the highest rating for
    overall readiness has actually increased slightly.
        However, we have significantly depleted our inventories of
    precision guided munitions and aircraft engines. This
    subcommittee's support will be vital as we address these
    readiness shortfalls.
        Finally, the wear and tear associated with more frequent
    operations may not be fully apparent until deployed units are
    available for thorough inspection after deployments. The Navy
    is assessing its ability to sustain various levels of war
    effort and developing innovative options to provide combat
    power more effectively, efficiently, and responsibly to the
    regional combatant commanders. This includes alternative
    manning and task force organizations as well as initiatives to
    compress the inter-deployment training cycle.
        The Navy is ready to sustain the recent operational tempo,
    which is similar to a routine peacetime force posture, as the
    global war on terrorism continues. Maintaining this pace will,
    however, imply greater costs for operating and maintaining our
    ships and aircraft, require us to carefully manage our
    deployments, and could place our future readiness programs,
    including modernization and transformation, at greater risk.
        Should the operational tempo increase above recent levels,
    we might eventually need to purchase more aircraft, modify the
    way we crew our ships, and expand our military, industrial, and
    maintenance infrastructures. The Navy remains capable of
    surging several carrier battle groups, as it did during the
    first months of Operation Enduring Freedom. However, a level of
    effort significantly above our current commitment cannot be
    sustained and would require a period of reconstitution after
    the surge operations were completed.
        The Navy's response to September 11 is a testament to the
    agility, lethality, and reach of maritime forces, and to the
    dedication and professionalism of our sailors. The Navy can
    sustain the recent pace of operations for several years and is
    developing and implementing ways to cope with higher
    operational tempos should they be required as the war
    continues. The Navy will, with the continued support of this
    subcommittee, meet whatever challenges lie ahead in the defense
    of America.
        On behalf of our sailors and their families who proudly
    serve our Nation, thank you very much for your support.
        [The prepared statement of Admiral Krol follows:]

              Prepared Statement by Rear Adm. Joseph J. Krol, USN

                                  INTRODUCTION

        Chairman Akaka, Senator Inhofe, and other distinguished members of
    this subcommittee, thank you for the opportunity to be with you today.
    It is a privilege to report to you on the status of our great Navy. I
    thank you for your continuing support of our fleet and sailors.
    Operation Enduring Freedom has demonstrated that America has the most
    responsive and combat capable Navy in the world. Because we place
    readiness at the top of our agenda, September 11 found the Navy well
    equipped, superbly trained, forward deployed, and ready to conduct
    prompt and sustained combat operations in defense of America. The day
    after the attacks on New York City and the Pentagon, two carrier battle
    groups (CVBGs), 25 ships, 177 aircraft, and 18,000 members of the Navy-
    Marine Corps team were on station. The Navy's contributions to the
    global war on terrorism (GWOT) have highlighted the value of projecting
    force deep inland from the sovereign and secure operational base
    provided by aircraft carriers and other naval combatants. This
    autonomous capability is increasingly important in an era of precarious
    access to terrestrial military bases.
        The Navy has been at the forefront in taking the fight to America's
    adversaries. On day one of Operation Enduring Freedom, submarines and
    surface ships crippled enemy air defenses with Tomahawk cruise
    missiles, while carrier strike forces launched long-range attacks
    against al Qaeda terrorists and the Taliban regime. Flying 80 strike
    sorties a day at the peak of Operation Enduring Freedom, carrier-based
    F-14 and F/A-18 aircraft accounted for more than 70 percent of all U.S.
    strike missions. We were able to disrupt terrorist organizations,
    destroy critical enemy infrastructure, and prevent further attacks on
    America and her allies. Operation Enduring Freedom has illustrated that
    we have clearly moved into a new era of effects-based warfare, in which
    military success is best measured by the timeliness and value of
    targets destroyed and not by the mass of ordnance expended.
        While naval strike forces were projecting U.S. power hundreds of
    miles into Afghanistan, other combatants were controlling the seas and
    performing vital operations around the globe. An unprecedented number
    of interceptions and inspections were conducted to interdict the
    maritime avenue of flight for terrorist leaders and restrict the flow
    of terrorist materials. Naval aircraft have conducted the vast majority
    of manned airborne reconnaissance flights in the Afghan theater and
    Navy SEALS have provided approximately half of our SOF capabilities on
    the ground. All of these operations are being well supported by our
    hard-working replenishment ships.
        The Navy's response at home to the attacks on New York City and the
    Pentagon was equally indicative of our culture of readiness. Off
    America's coasts, aircraft carriers, cruisers, and destroyers rapidly
    took station to protect the maritime and air approaches to the United
    States in the wake of September 11, 2001. Within view of ``ground
    zero'' in New York, the hospital ship USNS Comfort and the auxiliary
    USNS Denebola provided food, berthing, and medical care for the heroic
    first responders ashore.
        While protecting America's interests overseas and providing
    additional security at home, the Navy has also implemented more
    stringent Anti-Terrorism/Force Protection measures to safeguard our
    people and infrastructure. More than 5,000 reservists are reinforcing
    the security of our ships, naval bases, and other military
    installations. The Navy's response to the events of September 11 is
    testimony to the dedicated service of our sailors and to the agility,
    lethality, and reach of our naval forces.
        Thanks to our Navy's civilian and military leadership and the
    strong support of the American people and Congress, we have made solid
    progress over the last few years in addressing long-standing readiness
    issues. As a result of our priorities and this subcommittee's support,
    fiscal year 2002 was the best readiness budget in a decade. The fiscal
    year 2003 budget will likewise flow more resources where they are most
    needed: to warfighters in the fleet. However, the ongoing global war on
    terrorism has the potential to stress our fleet considerably and there
    is little elasticity in our force structure to permit growth in the
    naval missions required to take the fight to the enemy while protecting
    the maritime approaches to the United States.
        In my testimony, I intend to describe the impact of recent and on-
    going operations on Navy readiness, provide a qualitative assessment of
    the Navy's ability to continue the conflict, and discuss how the Navy
    is planning to manage its resources and risks to maintain a high state
    of readiness as the global war on terrorism continues.

                      IMPACT OF THE GWOT ON NAVY READINESS

        The Navy routinely maintains a forward-deployed expeditionary
    posture. This posture, combined with the fact that we have added nearly
    $5 billion to our key readiness accounts over the past 2 years, has
    minimized the impact of the war on current readiness. Since September
    11, approximately one-third of the fleet has been deployed on any given
    day. This percentage of deployed units is similar to our historic
    peacetime profile, with 40-50 percent of our fleet underway, and
    approximately 30 percent of our forces forward deployed to support the
    requirements of regional combatant commanders in areas such as the
    Persian Gulf, Europe, and the Pacific Rim. In order to meet these
    commitments, we have a rotational force in which ships, air wings, and
    personnel are either on deployment or in the process of preparing
    themselves for the next deployment.
        Although the number of ships underway and deployed has not
    dramatically increased during Operations Enduring Freedom and Noble
    Eagle, the OPTEMPO of deployed front-line units has. For example,
    U.S.S. Theodore Roosevelt recently completed a record-setting 159
    consecutive days at sea and U.S. surface combatants, in general, are
    steaming 50 percent more days per quarter than they would during a
    normal deployment. The increased amount of time at sea translates into
    fewer port calls and maintenance availability periods. The greater
    operational demands have been felt even more acutely by carrier air
    wings that were flying 250 hours per day at the peak of operations, and
    are still flying approximately 190 hours per day compared to an average
    of about 115 hours during a typical peacetime deployment.
        Despite this high operational tempo, we have not yet observed a
    significant degradation in readiness. Since September 11, we have
    actually witnessed a slight increase in the percentage of units
    reporting the highest level (C1) for overall readiness. Most key
    metrics of current readiness have remained stable since the GWOT began.
    The Mission Capable rates of naval strike aircraft remain comparable to
    historic averages, at around 70 percent. The cannibalization rate of
    naval aircraft in fiscal year 2001 was the lowest in 5 years; this
    trend does not appear to be reversed. The rates that our deployed units
    are reporting mission-critical material failures (CASREPs) have also
    not increased appreciably. However, the pools of spare aircraft engines
    and our inventories of precision-guided munitions have been depleted
    significantly. We are taking steps to address these negative readiness
    trends.
        It is too soon, however, to have a complete grasp of the total
    impact that higher OPTEMPO will have on readiness. More frequent
    operation of ships and aircraft entails additional wear and tear. For
    example, the F/A-18 has been flown well in excess of planned rates, and
    more than 300 of these aircraft will require service life extensions
    earlier than planned. The consequences of greater usage may not be
    fully apparent until these units are available for more thorough
    material inspections and assessment. In summary, there is no
    overwhelming evidence that the higher OPTEMPO required by the GWOT has
    significantly degraded material readiness, but we must closely monitor
    our key readiness metrics as the war continues.
        Personnel readiness has improved significantly over the last few
    years and this trend has not been reversed by the war. These gains are
    largely attributable to recent increases in base pay, housing
    allowances, and career sea pay. Last year's retention of first-term
    sailors was the best in more than 30 years and the first months of
    fiscal year 2002 were on a similar pace. Although we have not observed
    an increase in recruiting success since September 11, neither have we
    seen a downturn. However, sailors are spending a greater percentage of
    their time at sea, especially on deployment and this could eventually
    have a negative impact on manpower. We continue to manage personnel
    tempo carefully while meeting war exigencies.

                     SUSTAINING THE GLOBAL WAR ON TERRORISM

        It is quite probable that the global war on terrorism will continue
    for several years at a pace similar to, and perhaps periodically
    greater than, that required to date for Operation Enduring Freedom.
    Based on this probability, we are in the process of assessing our
    ability to continue the war at various levels of effort, as well as
    studying what change would be required to sustain those levels. The
    Navy would be able to sustain the recent pace of operations for the
    next few years with greater funding for operation and maintenance (O&M)
    and a few adjustments to how we normally maintain, train, and operate
    the fleet. O&M requirements will grow commensurately with increased
    steaming days, flying hours, and a higher demand for parts and depot
    maintenance. Mission Capable/Full Mission Capable Rates for aircraft
    will probably decline slightly and fewer aircraft will be available for
    the training of non-deployed carrier wings during the Inter-Deployment
    Training Cycle (IDTC). From a geo-political standpoint, focusing
    available carrier battle groups and amphibious ready groups (ARGs) on
    one or two regions will often mean that other key areas, not directly
    implicated in the GWOT, will have fewer forces available for presence
    and engagement missions.
        Operating slightly above our current level of effort is
    sustainable, even with periodic surge requirements. Sustaining this
    OPTEMPO would require additional increases in O&M funding for labor and
    for higher costs required to reduce the wait time for parts.
    Deployments would likely be extended, in some instances, beyond the
    Navy peacetime goal of 6 months, and turn-around times shortened
    between the deployments of certain combat units. Although additional
    surface combatants would not necessarily be required to sustain this
    operational pace, we might have to increase the inventory of aircraft
    to concurrently meet the demands of forward-deployed units and those of
    air wings in the IDTC. Finally, it is likely that the increased OPTEMPO
    of our ships and aircraft would result in less frequent non-operational
    periods, which would increase the already large and growing amount of
    deferred maintenance and retard key modernization plans to equip our
    ships and aircraft with improved sensors, avionics, information
    systems, and weaponry.
        Operating the Navy at a pace slightly above that required so far in
    the GWOT may also have personnel implications. Special care and
    management will likely be necessary to ensure that civilian workers
    with special skills, a group already in short supply, are recruited,
    trained, and retained in our shipyards and intermediate maintenance
    activities. We are currently analyzing our civilian and military
    manpower needs for the war.
        Expanding the commitment of naval forces significantly beyond our
    current level is possible for short periods of time, but not
    sustainable without changes to our force structure, manpower, and
    infrastructure. As we demonstrated during the first months of Operation
    Enduring Freedom, the Navy can surge its forces to place four aircraft
    carrier battle groups on station. While this peak level of effort would
    again be achievable in the future, it requires a significant period of
    reconstitution and cannot be sustained on a routine basis with our
    current fleet. Sustaining this high OPTEMPO would require more
    resources and, more importantly, might require an expansion of our
    industrial infrastructure.

                 MANAGING RESOURCES AND RISK IN A WAR TIME NAVY

        The events of September 11 have proven that we live in a new
    security environment that demands a reassessment of how the United
    States trains, equips, organizes, and operates its military. The Navy
    is conducting that review, and exploring the best methods to manage
    resources to sustain the global war on terrorism while minimizing
    risks.
    Manpower
        Manpower remains the Chief of Naval Operation's top priority.
    Although gains have been made in improving recruiting, retention, and
    attrition, these advances are perishable and we must continue to
    provide the best possible quality of service to our sailors and
    civilian workforce. Since the attacks on the Pentagon and New York
    City, we have mobilized more than 10,000 Reservists to ease the burden
    on our active duty personnel. About half of these sailors are helping
    implement more stringent Anti-Terrorism/Force Protection measures. The
    other half brings key expertise to the fleet and major staffs in the
    areas of intelligence, logistics, construction, meteorology, and base
    support. However, paying Reservists to remain on active duty is costly
    and may require additional funding as the war continues. In order to
    minimize this impact, we are currently validating the jobs being filled
    by Reservists with an eye toward demobilizing those who are not
    essential.
        We are also studying several options to provide alternative manning
    to the fleet. These possibilities include rotational crewing that would
    allow ships to spend more of their time in forward areas without
    reducing the quality of service of our sailors. The Navy has a
    successful history of providing rotational crewing to ballistic missile
    submarines. These models should help us develop the right plans to
    provide more ships-days to our regional CINCs.
    Compressing the Inter-Deployment Training Cycle (IDTC)
        Meeting a higher demand for deployed naval assets may require a
    compression of the Inter-Deployment Training Cycle. The typical 24-
    month deployment cycle consists of the following:

             6 month deployment overseas;
             1 month post-deployment leave and upkeep period;
             6 month intensive maintenance period;
             10 month training period; and
             1 month of leave, upkeep, and stores load-outs prior
            to deployment.

        The nominal cycle provides 18 months between 6-month deployments
    for a turn-around ratio of 3. Although that number can be reduced, the
    CNO has established a minimum turn-around ratio of 2.0. Two major
    activities comprise the period between deployments: training and
    maintenance.
        Our Navy is the best largely because of our most important
    asymmetric advantage: highly trained sailors. Developing the range of
    skills required to operate safely at sea and conduct combat operations
    entails training at sea and in port. In order to improve quality of
    life, the at-sea training required during the IDTC has already been
    reduced by about one-fourth over the last 5 years. Simulators and other
    applications of information technologies are being speeded to the
    fleet, but can only replicate and replace a portion of the real-world
    drills and exercises that give us an edge in combat. Our recently
    established Fleet Forces Command, located in Norfolk, is working with
    our operational forces to develop ways to decrease the training periods
    required in IDTC as well as to tailor them more closely for missions
    demanded by the GWOT. However, we do not expect to achieve a
    significant compression of the training requirements. We must also
    remember that reductions in the training of our air and ship crews may
    imply a risk to safety and combat effectiveness, especially in
    scenarios more challenging than the GWOT.
        As we consider compressing training between deployments, the need
    to ``train as we fight'' will increase. However, some environmental
    laws and urbanization increasingly impact this warfighting imperative.
    When urban encroachment and environmental concerns restrict our use of
    training ranges, our sailors miss out on valuable training
    opportunities that can improve combat effectiveness and reduce risks on
    the battlefield. In order to guarantee that in the future we'll be
    ready for the first day of combat, we must all recognize the value of
    our training ranges and provide for their continued use, including the
    use of live-fire training. We are analyzing the feasibility of relying
    more upon simulators that should reduce costs and training time, as
    well as decrease wear and tear on ships and aircraft. Although
    simulators and non-live-fire exercises are an important part of
    military training, there simply is no adequate substitute for live-fire
    training.
        Maintenance is the second component of the IDTC. There are two
    major options for reducing the time required to perform maintenance
    between deployments. The first involves deferring maintenance that is
    not absolutely essential to ship operations and combat effectiveness.
    However, we already have deferred maintenance amounts whose growth we
    have recently slowed, but not stopped, with increased funding. Although
    we are developing options to increase the capability to conduct
    forward-deployed repairs, all maintenance availabilities, whether
    conducted stateside or overseas, reduce the number of days that our
    combat platforms can operate and fight at sea.
        Another option is to speed up the pace of maintenance performed
    between deployments. It is, however, an expensive proposition to
    provide the around-the-clock shifts necessary to shorten maintenance
    periods. Additionally, the pool of qualified laborers, especially
    regarding the skills required to maintain nuclear propulsion plants,
    has little over-capacity and is fairly inelastic. The acceleration of
    maintenance is also often constrained by the limited availability of
    suitable shipyards, dry-docks, and other key components of our
    maintenance infrastructure. Finally, our sailors accomplish much of our
    ship and aircraft maintenance and retesting themselves, and increasing
    the pace of repairs could degrade their quality of service and training
    opportunities during the IDTC.
        Much of our ship maintenance revolves around our propulsion plants.
    Reducing or accelerating the maintenance on propulsion systems is often
    simply not prudent due to stringent, time-tested procedures and
    retesting requirements. In all cases, the deferment of maintenance or
    the taking of shortcuts can put readiness at risk at critical moments
    during combat operations.
    Changing the Way We Organize and Deploy Our Forces
        We are also studying alternatives on how we provide combat-ready
    ships and naval aircraft to the regional CINCs. Although the carrier
    battle group will remain the preeminent naval task force, we are
    looking at options to provide responsive, sustainable, and long-range
    strike forces composed of fewer and different units than those in our
    CVBGs. One construct is to complement ARGs with cruise missile capable
    surface combatants and submarines, producing ``Expeditionary Strike
    Forces'' tailored and equipped to destroy terrorist elements. These
    forces would provide distributed firepower when and where they are
    required by the regional CINCs.
    Replenishing Inventories of Precision-Guided Munitions
        Precision-guided munitions represented a fairly small fraction of
    the air-dropped weapons employed during the Persian Gulf War. Over the
    last decade, they have developed into the weapon of choice. The high
    demand for these weapons during Operation Enduring Freedom has depleted
    our inventories. To address this issue, we have added $973 million to
    procure more PGMs. However, our ability to replenish our inventories
    will depend primarily upon the ability of industry to meet the growing
    demand as well as upon usage rates in the future. Increasing the
    production rate will take time and there is no quick fix to this
    challenge. The Navy is committed to working through these challenges
    and obtaining the full wartime requirement for precision-guided
    munitions.
    Managing Long-Term Risks
        As this committee well understands, there always exists a tension
    between funding current readiness today and investing in future
    readiness for tomorrow. This tension is likely to increase as the GWOT
    continues. In fiscal year 2003, the Navy plans to purchase 83 new
    aircraft, build 5 new ships, and reconfigure 2 ballistic submarines as
    SOF-capable SSGNs. This procurement pace is well below what would be
    required later in the FYDP in order to maintain the fleet's present
    strength above, on, and beneath the world's oceans. We will need to be
    careful, and maintain the appropriate balance between the funding of
    current readiness and investing in tomorrow's fleet.
        The modernization of our ships and aircraft is vital to maintaining
    our edge in combat since about 60 percent of the ships steaming today
    will still be in the fleet in 2020. The Navy's modernization plan could
    be placed at risk by two factors as we continue to protect America and
    its allies from terrorism. Similar to recapitalization, we must guard
    against under-funding modernization in preference to funding the GWOT.
    Additionally, and perhaps more importantly, the higher expected OPTEMPO
    of our combat platforms means that there will be fewer opportunities to
    upgrade them with advanced sensors, avionics, offensive and defensive
    weapons systems, and information technology.
        Meeting the imperatives associated with our near-term security
    needs could put the Navy's transformation plans at greater risk. The
    events of September 11 and the lessons learned during Operations
    Enduring Freedom and Noble Eagle demonstrate that we clearly are faced
    with a new security environment that demands fundamental changes in our
    military cultures, doctrine and tactics, and combat systems. As with
    the other key components of future readiness, we must make every effort
    to ensure that we can operate in defense of America's freedoms today
    while concurrently preparing the Navy for an uncertain and extremely
    challenging future.
        Finally, we must ensure that funds remain available for the
    recapitalization of the Navy's infrastructure. Quality infrastructure
    is a vital part of ensuring both current and future readiness.
    Unfortunately, the Navy's shore infrastructure condition is less than
    satisfactory. While the fiscal year 2003 budget makes modest increases
    in sustainment, restoration, and modernization and military
    construction accounts, there remains much to be done. We are studying
    this problem and working on a plan to provide out-year funding to help
    mitigate these significant challenges. While funding the war, we must
    not forget about the infrastructure that sustains our sailors and
    ships.

                                   CONCLUSION

        The global war on terrorism has clearly demonstrated that the U.S.
    Navy is the world's best, and that our focus must remain on current
    readiness. The Navy's response since September 11 is a testament to the
    agility, lethality, and reach of maritime forces and to the dedication
    and sacrifice of our sailors. Because the Navy operates as a rotational
    expeditionary force, makes current readiness a top priority, and has
    had the strong support of this subcommittee, we can sustain the current
    pace of operations for the foreseeable future. The Navy can also surge
    forces quickly and maintain that level of effort for a few months.
    However, should the pace of the GWOT accelerate, we would be required
    to modify our deployment cycles and reexamine many of our plans and
    programs in light of the changing security environment. If we increase
    the war effort at sea, we would need to make some hard choices that
    might put the fleet's recapitalization, modernization, and
    transformation programs at greater risk. While not ignoring the future,
    a Navy at war must focus on maintaining current readiness. The Navy
    will, with the continued support of this committee, meet whatever
    challenges lie ahead in defense of America. On behalf of our sailors
    and their families who proudly serve our Nation, thank you for your
    support.

        Senator Akaka. Thank you very much, Admiral.
        Lieutenant General Bedard.

     STATEMENT OF LT. GEN. EMIL R. BEDARD, USMC, DEPUTY COMMANDANT
       FOR PLANS, POLICIES, AND OPERATIONS, HEADQUARTERS, UNITED
                          STATES MARINE CORPS

        General Bedard. Mr. Chairman, Senator Inhofe, and Senator
    Nelson, it is my privilege today to report on the state of
    readiness of America's Marine Corps. The theme that runs
    through all of our core competencies is readiness. If I may
    recall some language from the 82nd Congress, ``Your Marine
    Corps is designated and designed to be the most ready when the
    Nation is least ready.''
        With the continuing help of Congress and certainly this
    subcommittee, the United States Marine Corps and our Navy
    partners have always been ready to do just that. We were ready
    on September 10th; we were ready in November when we secured
    Rhino in southern Afghanistan; we were ready when we moved in
    to secure Kandahar in a long-range air and ground maneuver; and
    we were ready to move elements of the Fourth MEB Anti-Terrorism
    Brigade into Kabul, as well as into our Nation's capital. We
    are ready today and we will remain ready tomorrow.
        Readiness is comprised of training, equipment, and people.
    Training must produce combat-ready organizations. Our unique
    Marine air-ground task forces that are prepared to deploy
    quickly into austere environments, sustain themselves
    effectively over time, and as the culmination of this process,
    fight and win.
        Our service in Afghanistan attests to the capabilities of
    our forces better than any words could ever attempt to do. When
    the President called, our Marines provided themselves well,
    showed they were trained, adequately equipped, and up to any
    challenge. Our equipment, though aging, was superbly maintained
    and accomplished the mission. Our doctrine of maneuvering from
    the sea base to objectives well inland has been evolving for a
    decade and showed itself to be extraordinarily effective over
    the depth of the battlefield.
        The last and most important element of readiness in both
    peace and war is our people: marines, sailors, civilians, and
    their families. We must ensure they are properly equipped in
    accordance with our focus of expeditionary maneuver warfare,
    and ensure they will be treated fairly and compassionately by
    this country that they so eloquently serve.
        On behalf of the Commandant, I express my appreciation to
    this committee for your consistent support to the Corps. I also
    express our appreciation through you to the American people for
    their unflagging support. The small business people and
    corporations that have provided an opportunity for our
    Reservists to serve in this time of national crisis provide a
    valuable example that we all serve, both in uniform and out.
        I will close by observing that in combat sustaining is
    critical to winning. The same is true for the continued
    financial and readiness well-being of the Marine Corps. We
    depend on that sustainment provided by this subcommittee and
    Congress as a whole. This is a good time to be a United States
    Marine. My written statement addresses the issues of the Corps
    where your continued support is required to maintain our
    readiness and effectiveness.
        I welcome the opportunity of your questions and I
    appreciate being here today.
        [The prepared statement of General Bedard follows:]

              Prepared Statement by Lt. Gen. Emil R. Bedard, USMC

                                  INTRODUCTION

        Chairman Akaka, Senator Inhofe, and distinguished members of the
    subcommittee, it is my privilege to report on the state of readiness of
    America's Marine Corps.
        September 11 was a tragedy unlike any this Nation has faced. Never
    before have our citizens been so maliciously targeted, and with such
    catastrophic effects. We've been attacked before, but never have we
    faced an enemy who operates without a homeland. We've been attacked by
    pirates and terrorists before, but never by ones who intentionally
    target civilians with weapons of mass effects.
        The world is, now more than ever, uncertain and dangerous. Now,
    more than ever, the Marine Corps seeks to be a certain force in an
    uncertain world. For generations, the Marine Corps has trained and
    prepared to be ready to defeat America's enemies on short notice. When
    the trumpet sounded on September 11, the Nation's force in readiness
    answered the call.
        There are times when our devotion to readiness puts the U.S. Marine
    Corps at a disadvantage in the continuing transformation and
    modernization dialogue inside the Beltway. Being ready at a moment's
    notice requires focus, dedication, and flexibility. Being ready across
    the full range of conflict requires organizational scalability. Our
    enemies, as we have seen, are unpredictable and deadly. Providing a
    full range of options to the combatant commander has tremendous utility
    in today's environment. What we are, and will always be with your help,
    is ``ready.'' Prior to September 11, it may have been difficult for
    America to understand the value of forward deployed ready forces. I
    know that the distinguished members of this subcommittee understand the
    value of ready forces today, and have always understood; we've seen
    that through the strong support you've always provided. I believe that
    everyone outside this committee, and outside this city now understands.

                     READINESS--WHY THE MARINE CORPS EXISTS

        Let me describe for you the state of Marine Corps readiness as I
    see it from my position.
        Our first priority is, and will continue to be, readiness. Our
    sequence of priorities is ``mission first, marines always.'' Our
    service in Afghanistan attests to the state of that readiness better
    than my words could ever attempt to do. When the President called, our
    marines proved themselves to be well-trained, adequately equipped, and
    up to any challenge. Our equipment, though aging, was superbly
    maintained and accomplished the job. Our doctrine of maneuvering from a
    seabase to objectives well inland has been evolving for a decade, and
    has shown itself to be extraordinarily effective on the modern
    battlefield.

                        VALUE OF FORWARD DEPLOYED FORCES

        We have once again shown the value of forward deployed forces. In
    this era of renewed focus on defense of the American homeland, it is
    perhaps important to reemphasize that defense of that homeland begins
    not on our shores, but on the far shore. Our forward deployed role is
    comparable to a fire warden in a national forest. It is far easier to
    have a fire warden already on scene, see the lightning-caused brush
    fire, and put it out while still small and manageable than it is to
    mobilize national assets once the initial flames become an inferno.
        At times, we will be forced to act in ways that don't impact the
    sovereignty of those in the vicinity of our intended action. Forward
    deploying those ready forces at sea frees us from dependence on access
    to bases in theater or on the permission of a host government. The
    flexibility of a true seabase (as contrasted to units simply embarked
    on shipping) offers immense advantages. A U.S. Navy warship in
    international waters is sovereign U.S. territory. We need ask no one's
    permission or acquiescence in the use of facilities to position and
    employ U.S. forces. When combined with the force protection advantages
    inherent in being underway at sea, forward deployed forces operating
    from a seabase in international waters provides an invaluable option
    for the Joint Force Commander.
     operations in afghanistan--employing operational maneuver from the sea
        In operations in Afghanistan, the Navy-Marine Corps team, and as
    full members of the joint force, conducted the longest amphibious
    assault in the history of warfare. This proved our concepts of
    operational maneuver from the sea and ship-to-objective maneuver and
    was quite unlike the historic amphibious assaults at Tarawa or Inchon.
    We operated from a seabase, reducing our footprint ashore and thereby
    minimizing our force protection requirements and allowing us to operate
    with minimal basing in theater. We supported Special Operations Forces,
    we established bases, we seized and secured facilities. When called
    upon, we did our part to engage and defeat America's enemies.

        The Marine Corps, like everyone else, was surprised by the
    September 11 attacks, but we were not surprised by the nature of the
    threat. Over the past decade we have defined a world more chaotic and a
    future strategic environment of increasing uncertainty. We saw the
    premium that would be placed on speed, precision, and lethality; speed
    not only in movement, but also in the ability to respond--to be truly
    expeditionary. We published a new operational concept in January 1996,
    Operational Maneuver from the Sea, and the tactical implementation of
    that concept, Ship to Objective Maneuver later in the same year. In
    November 2001, we published Expeditionary Maneuver Warfare, a capstone
    concept that melded our expeditionary culture, warfighting ethos, and
    organizational concepts within the context of seabasing and our support
    to the Joint Warfighter. Instead of the traditional amphibious assault
    which essentially required seizing a forward operating base on the
    beach and then building up supplies and reorganizing from landing teams
    to combat formations, decisive operations across the entire spectrum of
    military operations from humanitarian assistance to amphibious assaults
    can now be launched directly from the seabase. The seabase will
    transform the way we project power and influence. The integrated
    seabase provides a sanctuary from which fires, command and control, and
    sustainment can flow when and where required without the threats
    presented by land-based forward operating bases.

                          NEW SYSTEMS FOR NEW CONCEPTS

        The new systems we have pursued in measured fashion since the 1980s
    are the keys to executing these concepts in the future. Several of the
    key systems and platforms, production of which has been delayed by the
    procurement holiday, are very close to coming on line and they will
    revolutionize how both the Marine Corps and the Joint Force Commander
    do business.
        In Afghanistan, using our new operational concepts executed with
    aging equipment, marines conducted an operational maneuver from the
    seabase, at distances previously thought to be unattainable. We were
    able to sustain the force primarily from the seabase, freeing us from
    the requirements of force protection in a large rear area. With your
    help, as new systems come on line, we will be free of the need for
    intermediate staging bases that are now required because of the short
    legs of our aging helicopter fleet. In effect, we will have created the
    ``maritime'' staging base. With the V-22 Osprey, the Short Takeoff and
    Vertical Landing variant Joint Strike Fighter (STOVL JSF), Advanced
    Amphibious Assault Vehicle (AAAV), and the Expeditionary Fire Support
    System (EFSS), we would have been able to move directly from the
    seabase to Khandahar airport and have a full range of expeditionary
    fires to organically conduct the full range of military operations.
    This will be a revolutionary leap in capability for the Joint Force
    Commander, combining the freedom and sustainment of coming from the sea
    with the long ranges of tilt-rotor and STOVL aviation. Combine our
    traditionally flexible organization, the Marine Air Ground Task Force
    (MAGTF), with these new systems and platforms and you will see a fully
    transformed Marine Corps. This transformation didn't start as a result
    of the QDR, but rather two decades ago, and these systems and platforms
    will soon be ready for fielding through transformational business
    practices in support of our changing concepts, organizations, and
    doctrine.

                    SUSTAINING THE CURRENT OPERATIONAL TEMPO

        Because we consistently deploy forces forward to various theaters,
    the Marine Corps has not had to radically change how we operate in
    order to support the global war on terrorism. The cost of employing
    these ready forces that you fund is minimal when compared to other
    options for achieving like capability. We have slightly adjusted
    deployment departure and return dates in order to maintain the current
    Marine Expeditionary Unit (Special Operations Capable) [MEU (SOC)]
    presence in the Afghanistan area of operations, but we have not had to
    deploy units out of their normal sequence or without critical training
    time. There have not been significant PERSTEMPO increases for our
    marines. Of the almost 5,600 marines participating in Operation
    Enduring Freedom, fully 90 percent were already forward deployed or
    scheduled to deploy.
        The Marine Corps can sustain this level of operations indefinitely.
    The real issue for us, as I will address shortly, is the amount of wear
    and tear we are putting on our aging equipment, and ultimately, the
    potential for reduced time between deployments that could impact
    training.
        Our operational commanders are working on contingency plans to
    increase, if necessary, the number of forward deployed units, and to
    support larger contingencies. When needed, our Reserve establishment
    can, as we have already done, assist the Active Marine Corps component
    in supporting ongoing operations. We have seamlessly integrated both
    Marine Expeditionary Force Augmentation Command Elements, two infantry
    battalions, two heavy helicopter squadrons, two aerial refueler
    detachments, and critical skill individuals.

                                HOW YOU CAN HELP

        Having said how well prepared we are, your natural question is
    where, if anywhere, do we need your help? In a phrase, ``modernization
    and transformation,'' and in terms of platforms, amphibious shipping
    and aircraft.
        The Marine Expeditionary Brigade (MEB) is the Nation's premier,
    medium weight, combat credible, sustainable, forcible entry capability.
    Today's amphibious MEB possesses capabilities that no other combat
    force in the world (either on-call today or envisioned for the future)
    has. The ability to prevail in an anti-access environment with a
    forcible entry, then conduct high tempo, full spectrum operations in
    support of U.S. national policy is unique to the MEB.

                              AMPHIBIOUS SHIPPING

        Our amphibious lift requirement has been consistently validated at
    3.0 MEB assault echelons that, in terms of today's ships, equates to
    approximately 45 amphibious ships. We understand the fiscal realities
    we operate within, and have thus adapted to a fiscally constrained
    amphibious lift capability of 2.5 MEB assault echelon equivalents.
    While we cannot achieve 2.5 MEB AE equivalents with current Active Duty
    shipping, use of reserve shipping in the Amphibious Lift Enhancement
    Plan (ALEP) gives the 2.5 MEB AE within 180 days of ALEP activation.
    Unfortunately, as the events of September 11 have shown, we don't
    anticipate the luxury of having a 180-day response time.

        We will be able to achieve our 2.5 MEB lift requirement with an
    all-active force upon delivery of the 12th LPD-17 amphibious ship.
    Ultimately, we see the amphibious fleet consisting of 12 LHDs/LHAs or
    their replacements, 12 LSDs, and 12 LPD-17s in the 2015 time frame.
    While currently short of the 3.0 MEB AE goal, this is a force that will
    provide us, at some risk, the necessary capability to project power in
    an anti-access environment in the near- and mid-term.
        Delivery of the 12 LPD-17 San Antonio-class ships is currently
    scheduled to be completed in 2015. We are concerned about potential
    further slippage in the LPD-17 program. Such slippage could cause us to
    fall well below the 2.5 MEB lift level and leave us without the lift
    required to meet the Nation's needs. We are also concerned with
    replacing the LHA-1 Tarawa-class ships. They will begin to reach the
    end of their 35-year service life in 2011, and considering the time to
    design and build a replacement ship, we need to begin the process now.
    The overall age of the amphibious fleet is also a concern. The average
    fleet age of an amphibious ship is 25 percent older than the average of
    all other Navy ships.

                                      AMPHIBIOUS SHIPPING AVERAGE AGE/SERVICE LIFE
    ----------------------------------------------------------------------------------------------------------------
                                                                Service life                        Latest scheduled
                    Type                   Number in class    (Including SLEP)   Oldest/Youngest    decommissioning
    ----------------------------------------------------------------------------------------------------------------
    LPD.................................                 11                 40            37/32.6               2012
    LSD 36..............................                  3                 35            33/29.9               2005
    LSD 41/49...........................                 12                 40           17.1/3.9               2038
    LHA.................................                  5                 35          25.7/21.9               2015
    LHD.................................                  7                 40           12.8/0.6               2041
    ----------------------------------------------------------------------------------------------------------------

                      MARITIME PREPOSITIONING FORCE (MPF)

        Another equal but unique partner in seabasing that will help us
    project power and influence, and counter an adversary's anti-access
    strategy and the persistent shortage of strategic sea and airlift is
    the Marine Corps Maritime Prepositioning Force (MPF). Today, this
    force, loads leased commercial shipping with a MEB's worth of ground
    equipment and 30 days of supplies and prepositions the shipping in
    strategically located ports around the world. The forces flow into
    theater through a mix of strategic airlift and sealift. The forces
    ``marry up'' with the prepositioned equipment and provide the CINC with
    a sustainable, combat capable force. By minimizing the requirement to
    use strategic airlift to flow marine units to theater, utilizing MPS
    saves thousands of sorties of strategic lift. The CINC is thus able to
    employ those sorties elsewhere to speed the deployment of other vital
    members of the joint force.
        Unfortunately, the leases on our ships expire in fiscal years 2009,
    2010, and 2011. We need National Defense Sealift Resources to replace
    this most flexible and cost effective asset. We have developed the
    concept of MPF Future and with your help we will replace the existing
    program. Meeting MPF Future requirements will allow at-sea arrival and
    assembly of forces, selective offload of equipment and supplies, and
    relieve us of the need for ports and airfields, revolutionizing joint
    force deployment and employment. We request your support in continuing
    the MPF Future program and truly transforming the seabase and the
    capabilities for joint force power projection.

                     V-22 OSPREY--OUR TOP AVIATION PRIORITY

        The V-22 remains the Marine Corps' number one aviation priority.
    With it, marine forces operating from the seabase will be able to take
    the best of long-range maneuver and strategic surprise, and marry it
    with the best of the sustainable forcible entry capability.
        We are certainly aware of the challenges associated with the V-22,
    but are pleased that the Under Secretary of Defense for Acquisition,
    Technology, and Logistics has announced that a new comprehensive flight
    test program for the Osprey will commence this spring. This flight test
    effort will be ``event driven,'' as opposed to being ``time driven.''
    Both the Secretary of the Navy and the Under Secretary of Defense for
    Acquisition, Technology, and Logistics will periodically review flight
    test results to assess the progress of this program. Of this we are
    certain: the V-22 will revolutionize expeditionary aviation and
    represents a mature technology ready for today's environment.

                     STOVL JSF--A NEW WAY OF DOING BUSINESS

        In late October 2001, the contract was awarded for the Joint Strike
    Fighter, signaling a new era in fielding naval aviation. The advantages
    of a stealthy strike-fighter capable of taking off from an
    expeditionary base on land or sea, flying in supersonic cruise,
    accomplishing its mission with advanced sensors and weapons, and
    returning to its expeditionary site are truly revolutionary. This
    aircraft will transform the very foundations of tactical airpower. The
    Short Takeoff and Vertical Landing Joint Strike Fighter (STOVL) variant
    provides operational access to over three to five times the number of
    airfields currently available worldwide capable of supporting our
    legacy aircraft. The STOVL JSF can operate from both conventional
    carriers and amphibious assault ship decks. This effectively doubles
    the number of shipborne platforms available for operations. As these
    highly capable aircraft shift from seabased platforms to expeditionary
    airfields, they can effectively decrease response time for missions by
    75 percent and increase time on station by 50 percent.

                        MODERNIZATION AND TRANSFORMATION

        The Marine Corps has always prided itself on taking care of the
    equipment and property with which we are entrusted. We think we've been
    good stewards of both. We are now at the point with some of our
    equipment and some of our property where it must be replaced.
        Most of the equipment and weapons systems in our command elements,
    ground combat forces, and combat service support units have reached or
    exceeded their programmed service lives. The procurement holiday of the
    past decade was based on the assumption of a strategic pause coincident
    with the end of the Cold War in which we could skip a generation of
    procurement and recapitalize with modern, transformational equipment.
    The global war on terrorism has marked the end of any strategic pause
    and has caused us to operate our equipment at an even higher rate than
    anticipated, as the overall tempo of operations increases.
        The cost of maintaining old equipment is often much higher than
    maintaining a similar piece of more modern equipment. Spares are harder
    to find and manufacturers are less willing to produce components based
    on old technology. The result is much higher costs both in dollars and
    man-hours.
        The majority of our key aviation equipment is older than the
    marines who use it. Our KC-130s are 19 years past their scheduled
    retirement. President Kennedy was in office when our first KC-130F
    rolled off of the assembly line. Our CH-46Es and CH-53Ds are over 30
    years old.
        This is expensive equipment to maintain. For example, on our CH-46
    aircraft, replacement airframe parts do not exist. Every airworthy
    airframe is still in service; there are no retired airframes to use for
    parts. Airframe parts have to be hand-made by a master artisan. Once
    crafted, because the Naval Aviation Depot has never previously
    fabricated the part, it must go through a test procedure. We have the
    same problem with our UH-1N and AH-1 aircraft. One small panel from the
    UH-1 tail costs as much as $5,000 to fabricate and stubwings for AH-1s
    cost $4,700 apiece for temporary repairs.
        The man-hour requirements are even more striking. While our
    maintenance numbers have held fairly constant, it has been on the backs
    of our young marines. The marines who keep our CH-46s flying have had
    to spend as many as 37 maintenance man-hours per flight hour to keep
    them mission ready. Hours spent maintaining aging aircraft are hours
    that are not spent in training or valuable off-duty time. The quality
    of life implications are significant.
        The fiscal year 2003 budget allows the Marine Corps to begin to
    make more robust levels of investment in ground and aviation
    modernization and transformational programs that we have outlined as
    vital to future readiness. However, until this new equipment is
    fielded, we will continue to ensure the readiness of our legacy
    systems. We will continue to take maximum advantage of Service Life
    Extension Programs (SLEPs) that enable us to improve the reliability
    and availability of our legacy systems, as we will be forced to
    continue to invest increasing levels of resources--manpower and
    dollars--in the maintenance of our aging equipment. We ask for your
    support of the increases in our fiscal year 2003 budget request for
    spares, corrosion control and depot maintenance.

                            FISCAL YEAR 2003 BUDGET

        The fiscal year 2003 budget request will, with your help, allow us
    to increase levels of investment in modernization of command and
    control, aviation, and ground equipment such as:
                              command and control
        Exploiting the capabilities offered by long-range aircraft, long
    range fires, operating from a seabase and with full connectivity to our
    Joint and coalition partners poses enormous command and control
    challenges.

             The Unit Operations Center (UOC) is comprised of
            Combat Centers and Combat Operation Centers and will provide a
            centralized facility to host command and control functionality
            for the Command Element, the Ground Combat Element, the Air
            Combat Element, and the Combat Service Support Element. The COC
            is scalable and supports command echelons for battalion and
            above.
             The Common Aviation Command and Control System (CAC2S)
            will provide a capability that allows operators to integrate
            marine aviation into joint and combined air/ground operations
            in support of Expeditionary Maneuver Warfare, Ship-to-Objective
            Maneuver, and other operations. It will specifically provide a
            common suite of tactical facilities, equipment, and interfaces
            for a system that will replace the legacy command and control
            equipment currently associated with the Tactical Air Command
            Center, the Tactical Air Operations Center, Air Traffic
            Control, Direct Air Support Center, Direct Air Support Center
            (Airborne), and the Low Altitude Air Defense Battalion.

                          INCREASED TACTICAL MOBILITY

             V-22 Program

              The MV-22 Osprey tilt-rotor is a revolutionary, advanced
            technology vertical/short takeoff and landing, multi-purpose
            tactical aircraft being procured to replace the current fleet
            of Vietnam era CH-46E and CH-53D aircraft. The MV-22's design
            incorporates the advanced, but mature, technologies of
            composite materials, fly-by-wire flight controls, digital
            cockpits, airfoil design, and manufacturing. The Osprey is
            capable of carrying 24 combat-equipped marines or a 10,000
            pound external load. It has strategic self-deployability with a
            2,100 mile range with a single aerial refueling. Procurement of
            the MV-22 remains the Marine Corps' number one aviation
            acquisition priority.

             Advanced Amphibious Assault Vehicle (AAAV)

              The AAAV remains the Marine Corps' number one ground
            acquisition priority. The AAAV will allow marines to eliminate
            the battlefield mobility gap and, for the first time in the
            history of naval warfare, maneuver ashore in a single, seamless
            stroke giving both the ships and landing forces sufficient sea
            space for maneuver, surprise, and protection.

                                     FIRES

        With the increased range and speed of the AAAV and the V-22, the
    breadth and depth of the battlefield are increased immensely. We must
    have weapons systems with greater range, lethality, and tactical
    mobility. The LW 155 is one key piece of this new family of fire
    support systems and in conjunction with increased range of the High
    Mobility Artillery Rocket System (HIMARS), we will have full spectrum,
    all weather fires across the depth of the expanding battlefield.
    HIMARS, a very lightweight and mobile system, has the capability of
    delivering very high volumes of rocket artillery in support of the
    ground scheme of maneuver. The family of improved mortars, including a
    new 120mm mortar for the infantry battalion, greatly extends the reach
    and punch of the infantry. Naval Surface Fire Support (NSFS) systems
    such as the Extended Range Guided Munition (ERGM), the 5''/62 gun, the
    Advanced Gun System, and the Naval Fires Control System will provide
    essential fire support during the early phases of the expeditionary
    operation and long-range all-weather fire support during operations
    ashore. Naval Surface Fire Support can spell the difference between
    success and failure in the early phases of expeditionary operations.
    Filling the gap between organic and aviation delivered fires, NSFS is
    vital to all-weather, day and night, precision application of naval
    fires. With enhanced Naval Surface Fire Support and with the
    implementation of the Expeditionary Fire Support System now in initial
    research and development, we will have a truly expeditionary range of
    all weather, day, and night fires. The Ground Weapon Locating Radar is
    necessary to protect our forces from our adversaries' counter-battery
    fires. Again, using Afghanistan as an illustration, mobile operations
    in mountainous terrain place a premium on indirect fires. We, more than
    any of the other services, place great emphasis on the power of close
    air support. Because of our familiarity with close air support, we also
    understand what it can't do. Surface based, indirect fires, whether
    from the land or the sea, are irreplaceable when forces are joined in
    close combat, particularly in the early phases of a seabased operation.
    Nothing else is as responsive to the commander's needs, or as reliable.
    They are not weather or facility dependent. As such, they are a key
    component in continuing to extend the reach and lethality of our ground
    forces. These new ground-based systems, and the seabased fires under
    development by the Navy in combination with STOVL JSF and the upgraded
    Cobra and Huey helicopter provide the Marine Corps a complete family of
    integrated sea, air, and land based fires.

             HIMARS

              High on our priority list is to marry precision maneuver with
            precision fires. We require ground-based fire support which is
            lethal, mobile, and with long range. HIMARS, the High Mobility
            Artillery Rocket System, fills this need. The HIMARS will
            provide ground-based, responsive, General Support, and General
            Support Reinforcing indirect fires that accurately engage
            targets at long range, with high volumes of lethal fire, under
            all weather conditions and throughout all phases of combat
            operations ashore. It will fire both precision and area
            munitions and has a maximum range of 60 kilometers.

             LW 155

              The Lightweight 155mm towed howitzer is needed to replace the
            M-198 howitzer that is at the end of its service life. It is a
            joint USMC/U.S. Army system that will meet or exceed all the
            requirements of the current M-198 system while reducing the
            weight from 16,000 to 9,000 pounds. The maximum range using
            unassisted projectiles is 15 miles and 18 miles using assisted
            projectiles.

             Naval Surface Fire Support

              Expeditionary Maneuver Warfare places unprecedented
            requirements for long-range, accurate, timely fires in support
            of the maneuver force. Systems such as the Extended Range
            Guided Munition (ERGM) will ensure the continuous availability
            of surface based fires firing during an expeditionary
            operation. ERGM is a guided projectile fired from cruiser and
            destroyer guns out to a maximum range of 63 miles. Development
            of land attack missile technologies will provide a supersonic
            surface-to-surface missile that will have a range far in excess
            of naval guns. Combined, they will provide a highly responsive,
            accurate, all-weather means of attacking critical targets and
            providing support to deployed marines beyond the range of naval
            guns.

             Fixed Wing Aircraft

              The STOVL JSF will be a single engine, stealthy, supersonic
            strike-fighter aircraft capable of short takeoffs and vertical
            landings. It will combine the basing flexibility of the AV-8
            with the multi-role capabilities, speed, and maneuverability of
            the F/A-18 to fulfill both the air-to-ground and air-to-air
            requirements of the Marine Corps.
              KC-130J will bring increased capability and mission
            flexibility to the planning table with its satellite
            communications system, survivability enhancements, night
            systems, enhanced rapid ground refueling, and improved aircraft
            systems. The KC-130J has 21 percent increased speed and 35
            percent increased range over current versions of the KC-130.
            The KC-130J will replace our aging fleet of KC-130Fs, Rs, and
            Ts.

                        EQUIPPING THE INDIVIDUAL MARINE

        We believe the deadliest weapon on the battlefield is a well-
    trained, well-led, and motivated U.S. marine equipped with the finest
    service rifle available. We are seeking to upgrade our service rifle to
    better ensure ``every marine a rifleman'' remains more than an
    institutional belief. Despite my testimony on expensive programs and
    futuristic systems, we remain committed to ``equipping the marine'' not
    manning the equipment, especially in a weapon system, as fundamental as
    the service rifle.

                                    TRAINING

        We can have the best, most modern equipment in the world, but
    without highly trained marines to operate and maintain it, we'll have a
    parking lot full of expensive gear. The key to the Marine Corps'
    success is no secret; it's our marines. They are fit, smart, well-
    trained, and motivated. They are devoted to their training, their
    country, and their Corps. For over 200 years, they have achieved
    victory over our foes.
        Ensuring these marines' skills are honed to a razor's edge is an
    enduring mission of the Marine Corps. We train hard and efficiently,
    trying to achieve as much combat training as possible at home station
    in order to be efficient with our time and money. Time spent in transit
    to distant training areas is lost training time. A lost training minute
    is never regained. With our forward deployed posture, there is no time,
    nor are there training areas, to retrain and refresh marines prior to
    committing them to either contingency or combat. They leave their home
    stations ready, and we seek to ensure they maintain that readiness
    during their forward deployments through an aggressive exercise
    schedule. These exercises, conducted while forward deployed, hone
    coalition building skills and enhance interoperability with allies and
    coalition partners.

                 TRAINING--ENSURING SUCCESS ON THE BATTLEFIELD

        There are few things regarding battle of which I'm certain, but I
    know that combat is chaotic and confusing. I'm also confident that the
    weapons systems and equipment you provide are the best and most lethal
    in the history of warfare. It is essential that we conduct rigorous,
    realistic training to ensure the safety of our marines and ensure we
    impose our will on our enemies. This rigorous training demands we place
    our marines, as closely as possible, under the same stresses, chaos,
    and confusion we envision they will face in combat.
         Rigorous, realistic training can be accomplished in a variety of
    ways, but the best method we've found simulates the way we fight and
    combines live-fire and maneuver. We accomplish this most effectively
    for our service combat training at the MAGTF Training Center at
    Twentynine Palms, California. We must retain the areas where we train,
    particularly those where we train in combined arms in conjunction with
    our Navy teammates. If we can't retain the areas we currently use, we
    must replace them with like or better facilities.
        Realistic, challenging joint exercises are equally important to
    ensure marine forces are fully capable of integrated joint operations.
    As a combined arms force of both ground and air forces, and with our
    close relationship to the U.S. Navy, the Marine Corps fully appreciates
    the synergy inherent in the joint fight and is an active participant in
    these challenging exercise programs. Providing well-trained, service
    unique capabilities is the greatest contribution to joint warfighting
    capabilities and is our Nation's truly asymmetric advantage.
        One of the most important things we can provide our forward
    deployed Navy-Marine Corps teams is confidence in their ability to
    employ all weapons systems at their disposal. Confidence that the
    forward air controller is going to coordinate an effective and safe
    mission, that the ground forces will suppress enemy air defenses and
    direct the trajectories of their projectiles in directions which don't
    hazard the aircraft and that the strike aircraft, will hit the target.
    We can learn the elements of this training in parts, and in multiple
    sites, but that works on the skills and techniques in piecemeal
    fashion, and does not necessarily engender the critical level of
    integration essential for combat readiness. It is absolutely critical
    that the Navy and Marine Corps maintain areas where they can combine
    naval gunfire, artillery, air, and ground maneuver forces
    simultaneously.

        ENCROACHMENT--THE DOMINANT READINESS PROBLEM IN THE 21ST CENTURY

        We note with appreciation the subcommittee's interest in the
    degrading effects of encroachment on combat readiness. Marine Corps
    Base Camp Pendleton is cataloging the combined effects of multiple and
    overlapping regulations and restrictions and how they impact our use of
    our training areas. The United States Marine Corps is proud of our
    record as good stewards of the environment.
        We are prepared to work through the Secretary of the Navy to
    exploit all available measures to ensure our continued access to our
    training areas. We do have concern about two areas. The first is the
    ever-increasing number of regulations based upon the Endangered Species
    Act, the Safe Drinking Water Act, and the Clean Air Act. Subsequent
    designation of Marine Corps training areas as ``critical habitat''
    poses a great potential for loss of accessible training areas and could
    potentially reduce readiness and increase the cost, in lost time and
    money, for training. The second area of concern is urbanization,
    further limiting the four dimensions essential for training: ground
    areas, air and sea space, and access to the electro-magnetic spectrum.
    Encroachment issues are emerging as one of the dominant readiness
    problems in the 21st century.

                 TAKING CARE OF OUR MARINES AND THEIR FAMILIES

        The greatest single contributor to Marine Corps readiness is the
    motivation and desire of our young marines to be the very best in the
    world. We have 212,000 marines today, 172,600 in the Active Forces and
    39,400 in the Reserve. With your help, we have made significant
    progress in taking care of these young men and women and their
    families. Increases in military pay and benefits, especially basic
    allowance for housing increases, improvements in health care, and
    improvements in on-base housing are key enhancements you have made
    reality. While we recruit marines, we retain families. The young men
    and women we don't retain return to society as solid American citizens.
    They will uphold their responsibilities, and their families are as much
    their responsibilities as their military duties. Medical care for sick
    children, good schools, a chance to save for a child's college
    education are as vital to ensuring our marines' readiness as ensuring
    there is adequate ammunition. A focused marine elicits the best from
    his training, and knowing that his family is well taken care of allows
    a marine to focus.

                        THE MARINE CORPS--A TOTAL FORCE

        It is important to note that the Marine Corps operates as a total
    force, including elements of both Active and Reserve components and
    depends on total force readiness. Our Reserve component is organized on
    exactly the same lines as our Active Force; we have not transferred a
    horizontal capability from the Active to the Reserve Forces. Our
    posture as forward deployed, forces in readiness does not allow us to
    have combat support or combat service support functions primarily in
    the Reserve structure. Accordingly, we strive to ensure our Reserve
    Forces are as well-trained and ready as our Active force. We integrate
    the Marine Corps Reserve Forces into ongoing exercises and training.
    Two Combined Arms Exercises per year are conducted entirely by Reserve
    Forces today. In support of the global war on terrorism, we have
    activated both Marine Expeditionary Force Augmentation Command
    Elements, two infantry battalions, two heavy helicopter squadrons, two
    aerial refueler transport detachments, as well as other staff
    augmentation individuals and units. I would personally like to express
    my gratitude and appreciation for the business owners, companies and
    government offices at all levels who have made it possible for our
    Reserve marines to train and to mobilize in support of our efforts
    against terrorism.

                                     SAFETY

        I personally believe deeply in the concept of the Marine Corps
    family. Just as any parent is concerned with his family's safety, our
    Commandant and every marine leader are focused on safety. As our 13th
    Commandant General John Lejeune stated, ``In the Marine Corps, the role
    of senior to subordinate is not one of master to servant, but rather
    one of teacher to student, father to son.'' I believe that deeply. It
    therefore pains me every time one of our marines is hurt or killed. It
    is especially painful when that injury or death was the result of a
    preventable accident.
        One of our greatest challenges in this area of safety is the basic
    composition of the Marine Corps. Two of three marines are under the age
    of 25, roughly 6 to 8 years younger than the average age of the members
    of the other services. We are a young force, and this is part of the
    culture of the Corps. Our unique force structure has fully 68 percent
    of our marines on the first enlistment at any one time. While 2001 was
    a banner year for safety for the Marine Corps, I cannot say we have
    done as well recently. I am personally focused on this issue, as are
    all marine leaders. We have not found a common thread or pattern in our
    ongoing analyses. Please rest assured that the Marine Corps as an
    institution, and I personally, will not rest until we reduce the level
    of preventable accidents to zero.

                                   CONCLUSION

        Marines were the first conventional ground combat forces in
    Afghanistan. We accomplished that feat with superbly trained marines
    and impeccably maintained equipment. While well maintained, that gear
    is old and aging fast due to the higher usage rates caused by the
    ongoing war. We were able to defeat our enemies in Afghanistan because
    we were ready when called. This remains our focus, and our number one
    mission. We need your help in keeping up our old gear, modernizing
    where we can, and taking care of our marines and their families.
        What you saw in Afghanistan is just the beginning of what America
    and the world will see from a fully modernized and transformed Marine
    Corps. Marines moved 600 miles inland with 30-year-old helicopters and
    35-year-old cargo aircraft C-130s. Our marines are ready, our doctrine
    works, and with the new hardware ready to come on line, you're going to
    get a Marine Corps that's leaner, more lethal, and even more ready,
    just like you've expected for 226 years. Only then, it will come with a
    1,000 mile reach. We know that we're really just beginning the hard
    work of the global war on terrorism; the tough targets are in our
    windshield, not our rearview mirror. We need your help to be ready for
    the tough fights ahead. We think we've proved worthy of your continued
    support and ask that you continue to support your Marine Corps as you
    always have. Thank you for giving me the opportunity to address
    readiness--an issue critical to marines and our Nation.

        Senator Akaka. Thank you very much, General.
        General Wald.

     STATEMENT OF LT. GEN. CHARLES F. WALD, USAF, DEPUTY CHIEF OF
            STAFF FOR AIR AND SPACE OPERATIONS, HEADQUARTERS

        General Wald. Mr. Chairman, Senator Inhofe, Senator Nelson:
    Thank you. In the interest of time, I will defer my prepared
    comments, but I would like to make just a couple personal
    observations. First of all, I would like to thank you and the
    members of the subcommittee for the continued support we have
    in our readiness in the United States Air Force. As the
    commander in Afghanistan for the air war for the first 2
    months, I was a recipient of tremendous readiness of our forces
    and can tell you that we were ready on September 25 to start
    the operation in Afghanistan, which I think is probably
    unprecedented in the history of our military.
        I attribute that to the great support you have given us and
    to the great joint effort that our services have made in both
    this effort and our training in the past.
        I would like to tell you on behalf of the men and women of
    the United States Air Force that we thank you very much for
    your continued support and, now that I am a force provider, I
    look forward to working with the subcommittee in the future to
    sustain our readiness as it is today.
        Thank you.
        [The prepared statement of General Wald follows:]

              Prepared Statement by Lt. Gen. Charles F. Wald, USAF

        Mr. Chairman, members of the subcommittee, thank you for this
    opportunity to provide you with the status of Air Force readiness. As
    the Air Force's Deputy Chief of Staff, Air and Space Operations, I want
    to thank you for your continued focus on the readiness challenges
    facing the men and women in our great Air Force today. We have the most
    respected air and space force in the world, and we are transforming our
    service into the new century while maintaining global readiness and
    warfighting capabilities to support America's National Security
    Strategy.

                                    OVERALL

        From the Korean Peninsula to Kabul, across every continent and over
    all bodies of water, Air Force civilian, Active Duty, Guard, and
    Reserve Forces continue to execute their global missions. We had a busy
    year. The Air Force flew over 1,000 sorties over the former Yugoslavia,
    enforcing no-fly zones. In Southwest Asia, a continuous steady-force
    presence of more than 8,000 airmen supported Operations Northern Watch
    and Southern Watch, flying 70 percent of all coalition sorties. The Air
    Force continued support in the ongoing war on drugs over the Caribbean
    and South America, contributing to the seizure of over 75,000 kilos of
    narcotics. Natural disasters in India, Central America, South America,
    and the United States saw Air Force personnel and equipment
    transporting relief supplies, providing medical support and assisting
    in engineering projects.
        The Total Air Force Team was one of the very first to respond to
    the attacks of September 11, and that response continues unabated. Both
    Operations Noble Eagle and Enduring Freedom have seen airmen along with
    our sister services successfully providing humanitarian, combat, and
    support operations.
        Operational demands on the Air Force before September 11 were
    significant. Although we reached significant milestones in terms of
    reducing the effects of high tempo operations, the advent of war
    impacted many of those gains.
        Our situation is more complicated since our aircraft fleet is older
    and more expensive to maintain. Recapitalization of our airframes and
    weapons systems is a partial solution. The Air Force is hoping to
    upgrade our infrastructure and physical plant, which includes
    sustainment, restoration, modernization, transportation, support
    equipment, and communications systems. With the help of Congress, we
    have made considerable progress in addressing pay, benefits, and
    quality of life issues--improved investments for our people.
        We are hopeful that our readiness rates bottomed out in February
    2001 at 65 percent. Fortunately, we've improved to 71 percent this
    year. While this is a marked increase, there's more to do. Whether it's
    well-stocked bins, improved depot maintenance, or available state-of-
    the-art equipment, improvements are needed. The Air Force is pursuing
    improvements across all core competencies, for our equipment,
    organizations, and personnel. A readied force is the key to meeting the
    threats and challenges of the future.

                           AIR AND SPACE SUPERIORITY

        The Air Force is investing in a range of systems encompassed in the
    entire Find-Fix-Track-Target-Engage-Assess (F2T2EA) kill chain. Our
    legacy air-to-air platforms continue to be key to this process. We
    continue to pursue modernization of F-15 and F-16 radars, engines, and
    enhanced combat capability to ensure near-term fleet maintenance and
    air superiority in the air-to-air combat environment. We have made
    advances with the Joint Helmet Mounted Sight and the AIM-9X and AIM-120
    next-generation air-to-air missiles. Our greatest advantage with
    current systems is our robust training and exercise program and access
    to 41 combat ranges, essential to our airmen for effective training,
    equipment development, and experience building.
        Several electronic warfare programs support self-defense against
    enemy air defense systems. For example, the Comet Pod infrared (IR)
    countermeasures system will provide pre-emptive protection for the A-10
    against IR surface-to-air missiles (SAMs), enhancing survivability in
    the A-10's low-altitude close air support role. The Air Force is also
    addressing multiple Combat Mission Needs Statements and accelerating
    ramp-up for production of an IR flare, responding to today's air war
    threat in Afghanistan, and providing protection to special operations
    aircraft in combat zones. The Air Force is putting much emphasis on
    countermeasures to protect fighters and bombers from advanced SAM
    threats while increasing the viability and lethality of current
    platforms to conduct operations in the modern radio frequency (RF)
    threat arena. We have numerous, much-needed enhancements on the horizon
    for the critical Combat Search and Rescue (CSAR) mission.
        The Air Force is the designated Executive Agent for Space and has
    begun integrating systems acquisition with operations. To aid in this,
    the Air Force realigned the Space and Missile Systems Center from Air
    Force Materiel Command to Air Force Space Command. The Air Force
    accomplished the first National Security Space Program Assessment and
    will use it to draft our first National Security Space Plan later this
    year.
        The Spacelift Range System modernization program is replacing aging
    and non-supportable equipment, improving reliability and efficiency,
    and reducing the cost of operations at the eastern and western launch
    ranges. Coupled with the Evolved Expendable Launch Vehicle (EELV)
    program, the Air Force will meet the future launch demands of national
    security, civil, and commercial payloads.

                            INFORMATION SUPERIORITY

        Success in achieving information superiority requires an effects-
    based approach, superior battlespace awareness, well-integrated
    planning and execution, and properly trained and equipped information
    operations (IO) organization. These ensure our information systems are
    free from attack while retaining the freedom to attack an adversary's
    systems. In coordination with joint forces, the Air Force engages in
    the daily conduct of IO functions across the spectrum of military
    operations, providing security to our Air Force commanders, joint
    forces CINCs, and multinational forces.
        Our operational and tactical command and control (C2) airborne
    platforms and ground assets are in great demand and are in various
    upgrade stages. Our Air and space Operations Centers (AOC), with their
    decentralized component Control Reporting Centers (CRC) and Theater
    Battle Management Core Systems (TBMCS), create a comprehensive
    awareness of the battlespace so that the Joint Forces Air and Space
    Component Commander (JFACC) can task and execute the most complex air
    and space operations across the entire spectrum of conflict. During
    Operations Noble Eagle (ONE) and Enduring Freedom (OEF), TBMCS was
    rapidly deployed to support both CENTCOM and NORAD operations centers.
    TBMCS will evolve into an open-ended architecture capable of
    interfacing with a variety of joint and coalition databases, displays,
    and links.
        Throughout 2001, the Air Force aggressively addressed the need to
    standardize C2 of air and space forces. Our focus is to refine the AOC
    into a standardized weapon system with properly trained operators,
    improving its ability to meet worldwide requirements. Supporting ONE
    and OEF validated our strategic vision for C2 systems. We will continue
    to develop the AOC, keeping it on course to revolutionize the
    operational level of warfare.
        The Airborne Warning and Control System (AWACS) remains our premier
    air battle management and wide-area surveillance platform. Several
    upgrade programs are necessary to address aging aircraft issues,
    obsolete technologies, and the proliferation of advanced adversary
    systems. This year, one third of the AWACS fleet completed an improved
    radar system upgrade, which will reach full operational capability in
    fiscal year 2005. The next upgrade will replace 1970-vintage processors
    and a satellite communications access program will improve connectivity
    with regional and national C2 centers.
        Our limited numbers of airborne intelligence, surveillance, and
    reconnaissance (ISR) systems are in high demand. The RC-135 Rivet
    Joint, U-2, Distributed Common Ground System (DCGS), and Predator and
    Global Hawk unmanned aerial vehicles (UAVs) have proven indispensable
    during OEF and the expanding war on terrorism by providing real-time
    target data, threat warning, and battle damage assessment. The Joint
    Surveillance Target Attack Radar System (JSTARS) will see significant
    upgrades to its computer systems by 2005, while recapitalization and
    modernization efforts promise to keep the RC-135 Rivet Joint and U-2
    viable well into the 21st century.
        We are committed to the production and fielding of Global Hawk as
    the next-generation high altitude airborne ISR platform. In the spring
    of 2001, Global Hawk successfully completed a deployment to Australia,
    supporting maritime reconnaissance and achieving the first trans-
    Pacific crossing. Global Hawk was also deployed in support of OEF and
    with advanced sensor development underway, will be able to better
    support the time-critical targeting mission. Demands for the older
    Predator UAV remain high. In fiscal year 2002, the Air Force will
    double Predator aircraft production, accelerating to two aircraft per
    month, adding 40 additional aircraft to the current inventory. The Air
    Force will also stand up a third Predator squadron and begin
    weaponizing the fleet.
        The Multi-Platform Radar Technology Insertion Program (MP-RTIP)
    will allow larger and enhanced air-to-ground surveillance capabilities
    on a variety of platforms, to include Global Hawk, and potentially a
    NATO-manned platform variant.
        Achieving information superiority depends considerably on the
    availability of a robust worldwide communications capability.
    Tremendous efforts are underway to modernize Military Satellite
    Communications (MILSATCOM) systems to keep up with demands. The scope
    and speed of joint operations, including OEF, simply would not be
    possible without MILSATCOM systems such as the Defense Satellite
    Communications System (DSCS) and the Military Strategic and Tactical
    Relay System (MILSTAR). The Air Force awarded a System Development and
    Demonstration contract in November 2001 to design the Advanced
    Extremely High Frequency (AEHF) satellite system, an eventual
    replacement for the MILSTAR constellation beginning in 2006.
        The Air Force is combining efforts with the other services to form
    the joint Global Information Grid (GIG), allowing warfighters,
    policymakers, and support personnel access to information on demand.
    During OEF operations, deployable communications packages were
    successfully connected to the GIG to support combat operations.

                                 GLOBAL ATTACK

        The Air Force creates desired effects within hours of tasking,
    anywhere on the globe, including locations deep within an adversary's
    territory. Our B-1, B-2, and B-52 bombers provide the global rapid
    response, precision and standoff strike capability, 24/7 battlespace
    persistence, and a time-critical targeting capability. These platforms
    now carry the highly accurate 2000-pound Joint Direct Attack Munition
    (JDAM) and are being fitted to carry new standoff precision guided
    weapons. Future integration will see inclusion of smaller precision
    weapons. Until the F-22, Joint Strike Fighter (JSF), and Unmanned
    Combat Aerial Vehicle (UCAV) become an operational part of the
    inventory, the Air Force continues to rely on its legacy fighters (F-
    15, F-16, F-117, and A-10) to provide the air-to-air and air-to-ground
    capability.
        Consistent with recent DOD Nuclear Posture Review (NPR) direction,
    the Air Force is providing for long-term sustainment of
    Intercontinental Ballistic Missile (ICBM) capabilities. Minuteman III
    (MMIII) ICBMs will be deployed through 2020 and supported by on-going
    life-extension programs, while Peacekeeper (PK) ICBMs will be retired
    beginning this year. As the PK system is deactivated, the Air Force
    intends to transfer some warheads currently on PK to the MMIII, thereby
    avoiding a costly life-extension program on certain MMIII warheads.

                              PRECISION ENGAGEMENT

        The Air Force made significant progress in developing and fielding
    a new generation of weapons that can attack and destroy pinpoint,
    hardened, and relocatable targets at night and in most weather
    conditions while greatly reducing the risk to operators. By rapidly
    adapting new technology employed under actual combat conditions in
    Operations Allied Force and Enduring Freedom, we now have an array of
    precision weapons that can be employed from nearly all our combat
    aircraft. These programs include the Joint Standoff Weapon (JSOW),
    Joint Direct Attack Munition (JDAM), and Wind Corrected Munitions
    Dispenser (WCMD).
        From the Balkans to Kabul, combatant commanders required precision
    capability, not large-scale conventional operations. However, this
    demand reduced our large Cold War reserve munitions stockpiles. OEF
    requirements have depleted preferred precision munitions stockpiles.
    The President's budget for fiscal year 2002 together with supplemental
    requests provided over $1 billion to increase the industrial capacity
    to produce precision weapons and to procure additional weapons. The
    fiscal year 2003 program/budget review also added funding to ensure
    that this increased production would be sustained. It is unlikely that
    we will be forced to source assets from other theaters, which would
    increase the risk to potential operations elsewhere. The Air Force is
    working to increase precision-guided munitions (PGM) capabilities over
    the next several years.
        Precision strike, however, is more than simply very accurate
    munitions. It is also the ability to generate precise effects other
    than destruction. The Air Force is investing in various non-lethal
    weapons, offensive information warfare capabilities, and directed
    energy weapons to enable our military to affect targets without having
    to destroy them.

                             RAPID GLOBAL MOBILITY

        Airlift and tanker aircraft give the United States the ability to
    swiftly reach out and influence events around the world. OEF and ONE
    have again shown the utility of rapid global mobility. We witnessed the
    potential need to provide critical tactical lift capability for
    immediate response at home. Air Mobility Command is undergoing
    comprehensive review of the air mobility force structure as part of an
    on-going effort to assess airlift requirements.
        The procurement of additional C-17s will ensure the Air Force's
    ability to support its 54.5 million-ton miles per day airlift
    requirement. The Air Force needs at least 180 C-17s and will award a
    follow-on multiyear procurement contract to reach that number. Beddown
    plans will be conducted by Active, Reserve, and Guard forces.
        The average age of our KC-135 tankers is now over 41 years and
    operations and support costs are escalating due to a variety of
    factors. Pacer CRAG (compass, radar, and global positioning system) is
    a major overhaul project underway for all Air Force KC-135s, meeting
    the congressionally mandated requirement to install GPS in all Defense
    Department aircraft. The ongoing war on terrorism is further stretching
    the tanker fleet, motivating consideration of accelerating replacement
    options. The Air Force is focused on acquiring the world's newest and
    most capable tanker while increasing availability, fuel load, and
    reliability all with far lower cost.
        Modernization of the C-5 and C-130 fleets is a top priority.
    Avionics modernization, re-engining programs, and multiyear testing
    will bring the fleet up to an improved standard while determining the
    need for additional C-17s or alternatives. New C-130Js will replace EC-
    130Es, the most worn-out C-130E combat delivery aircraft, Commando Solo
    platforms, and several WC-130H aircraft throughout the Active Duty,
    Guard, and Reserve units.
        Additional upgrades and improvements to counter-measure defenses,
    CV-22, and VIP Special Air Mission/Operational Support Airlift are also
    planned.

                              AGILE COMBAT SUPPORT

        Much of the deployment strain in support of Operation Enduring
    Freedom has fallen on our expeditionary combat support forces. Some
    high-demand support areas have exceeded their on-call capabilities in
    current AEF rotation cycles as a result of our surge mode activities,
    which are likely to continue for some time. Some Expeditionary Combat
    Support career fields, particularly Security Forces, Combat
    Communications, and Fire Fighters, are highly stressed. Consequently,
    we are continuing to make gains in right-sizing deployment teams so
    that they are postured efficiently and effectively for expeditionary
    needs.
        The fielding of the Integrated Deployment System at all wings has
    improved the readiness of the wing deployment process. The CSAF's
    Logistics Review (CLR) and ongoing logistics transformation are
    reengineering our logistics processes to achieve an agile, effective,
    and well-integrated logistics chain responsive to AEF requirements.
    Other initiatives within the nuclear-biological-chemical and medical
    units are producing meaningful results.

                                     PEOPLE

        People are the most critical component of readiness and our most
    vital resource. As they perform Air Force missions around the world,
    the demands we place on them require highly motivated, highly skilled,
    professional airmen. Continued positive momentum in areas of
    compensation, benefits, recruiting and retention ensure the investment
    in our people.
        The Air Force has enhanced responsive force packaging and provided
    a more stable and predictable deployment and home station scheduling
    environment through implementation of the Expeditionary Air and Space
    Force (EAF). Air National Guard and Air Force Reserve participation has
    steadily increased since Desert Storm, which has created challenges for
    Guardsmen and Reservists balancing civilian careers with increased
    military requirements. Trends show demand for air power will only
    increase; EAF holds promise by giving airmen predictability and
    stability.
        The increased operations tempo resulting from OEF and ONE are also
    reducing necessary training opportunities for the force and are raising
    long-term readiness challenges. Many of our low density/high demand
    assets have limited flying training capacity. For example, operational
    demands have diminished RC-135 Rivet Joint, CSAR, and E-3 AWACS
    airframe, simulator, and instructor availability. The increased number
    of fighters and mobility assets now on alert and unavailable for
    continuation/readiness training could have a serious impact on long-
    term readiness.
        Retention will continue to be a priority and a challenge. Stop loss
    and the increased tempo of ONE and OEF may have a negative effect on
    retention--offsets are already being explored. Aggressive campaigns are
    being worked to ``re-recruit'' the force, addressing especially Battle
    Managers and other critical skills. While cockpits are now fully
    manned, rated pilot staff manning has fallen to 51 percent. The USAF
    pilot shortage is expected to continue for at least the next eight
    years until the effects of the 10-year Active Duty service commitment
    for undergraduate flying training are fully realized. ``Re-recruiting''
    efforts should also help alleviate the shortage sooner.
        The Air Force Reserve exceeded command retention goals for their
    enlisted airmen during fiscal year 2001. Seventy-eight percent of the
    enlisted skills are now receiving re-enlistment bonuses. The
    authorization to pay officer and enlisted critical skills retention
    bonuses should help retain individuals in high demand by the civilian
    sector. The Air National Guard's number one priority is to increase the
    traditional pilot force, which has held steady at 90 percent. Through
    various incentive pay programs, the Guard and Reserve continue to
    pursue substantial enhancements to increase retention in the aviation
    community as well as attracting and retaining individuals to aviation.
        Today, less than 10 percent of Air Force civilians are in their
    first 5 years of service. In the next 5 years, more than 40 percent
    will be eligible for optional or early retirement. In addition,
    downsizing over the past decade skewed the mix of civilian workforce
    skills, compounding the loss of corporate memory and lack of breadth
    and depth of experience. It's critical to maintain the right mix of
    civilian skills to meet tomorrow's challenges. Several initiatives are
    underway to do just that.

                                    SUMMARY

        Air Force capabilities provide America with a unique set of
    strengths--asymmetric advantages. However, today's technological
    advantage is no guarantee of future success. Maintaining the current
    leadership position requires addressing aging infrastructure,
    modernizing outdated weapon systems and harnessing technology to
    achieve our vision.
        In closing, today more than 725,000 highly skilled, professional,
    Air Force men and women are proudly supporting freedom's cause. We
    appreciate all this committee has done in helping to address these
    critical issues and look forward to working with you in the future.

        Senator Akaka. Thank you very much for your statement.
        General Wald, your fiscal year 2003 unfunded priority list
    includes $163 million for critical maintenance repairs for the
    B-1B, the B-2, and the F-15. Your justification states that if
    funding is not provided some aircraft will be grounded and
    suggests that there may be serious safety concerns as well.
    What higher priority does the Air Force have than ensuring the
    safety of its pilots and maintaining the ability of its
    aircraft to fly? Why was this funding not included in the
    budget? If additional funding is not provided, what will the
    Air Force do about these problems?
        General Wald. As you stated, there is no higher priority
    than the safety of our people in combat. But in the incidents
    that you stated, the B-1, the B-2, and the F-15, all three of
    those problem areas have arisen since September 11. The B-1 has
    been flying in heavy combat since October 7. There has been a
    structural problem material-wise with the pivot bolt in the
    wing that has been identified since last year's budget.
        On the B-2 in October, an area of cracking has once again
    been identified behind the engine exhaust as something that
    needs to be replaced. We are working on a fix for that as we
    speak.
        On the F-15 flight control problem, the stabilator
    delamination once again has exacerbated itself in recent months
    and, due to the OPTEMPO of that aircraft for homeland defense,
    it is critical for us to maintain the mission-capable rate on
    that particular aircraft as well.
        So we will put money into those three systems based on our
    operational tempo and the need for those three systems in the
    near-term. But ironically, most of those problems have been
    identified just recently.
        Senator Akaka. Thank you.
        General McKiernan, you mentioned the Army's new Strategic
    Readiness System (SRS), which is intended the improve the
    Army's ability to proactively address readiness concerns. Can
    you provide additional details about the system and how
    specifically it will achieve those ends?
        General McKiernan. Yes, sir. We are very excited about
    Strategic Readiness System, because it addresses a challenge
    that the Army has had in assessing readiness of our units. We
    have historically looked backwards at previous time frames to
    assess readiness and only for that specific unit. With SRS,
    which will be a network system, commanders at all levels will
    be able to go into existing databases to look at readiness
    metrics, not only in that unit, but in effect take it from the
    foxhole back to industrial base or recruiting base.
        It allows commanders to look much more holistically at
    current readiness and predictive readiness of those units.
        Senator Akaka. General McKiernan, your testimony discusses
    the shift in the most recent Quadrennial Defense Review away
    from the requirement to fight and win two nearly simultaneous
    major theater wars to the new requirement to conduct small
    scale contingency and high intensity operations simultaneously.
    I would like each of you to describe what impact this shift has
    had, if any, on your service's requirements, and in particular,
    on what you tell your forces to be ready for and how you assess
    readiness against the new strategy.
        General McKiernan.
        General McKiernan. Yes, sir. In the strategic guidance
    provided to us by OSD, it does go away from the old paradigm of
    two near-simultaneous major theaters of war to a much more
    flexible strategy that talks in terms of swiftly defeating an
    enemy, as well as several smaller-scale contingencies.
         First of all, what that means to the Army as we look at
    the adequacy of our structure is that, we, like everybody, have
    to go to a capabilities-based approach, so that forces are
    globally capable of responding to the strategy; and second, as
    we look at the adequacy of our structure, in some cases we find
    we have to either move some capabilities in terms of structure
    elsewhere. It certainly does not decrease our need for forces.
        Senator Akaka. Admiral Krol.
        Admiral Krol. Yes, sir. In general, the major forces that
    we have are capable of supporting the new strategy. The biggest
    difference that the Navy has is that we are a rotational force,
    and as long as we maintain our 12 carrier battle groups with
    the associated support ships and the 12 amphibious ready
    groups, our rotational force can support the new strategy.
        Senator Akaka. General Bedard.
        General Bedard. Sir, from a standpoint of the Marine Corps,
    we believe that our forces have to be capable of fighting
    across the spectrum of conflict. So from a standpoint of change
    to the new strategy and how that affects our forces, we do not
    believe it does.
        The other comment that I would like to make goes back to
    the earlier testimony on readiness: the forces that the Marine
    Corps employed in Afghanistan left the United States before
    September 11, and were certified and trained to carry out 23
    different missions. They were trained and certified to do these
    missions in any place that we might commit them to around the
    world.
        We feel our expeditionary forces have to be capable of
    worldwide deployment and that is the way we train.
        Senator Akaka. Thank you.
        General Wald.
        General Wald. I agree with General Bedard. The Air Force
    maintains a high state of readiness for all of our forces,
    whether they are Active Duty, Guard, or Reserve. I think the
    new strategy and what we have witnessed since September 11 has
    proven out the fact that our forces will be called upon,
    sometimes unannounced, rapidly around the world.
        As we go through this high OPTEMPO based on the September
    11 change in the world situation, the issue we will have to
    watch closely will be how do we continue to train our forces
    for the various missions we will do around the world, not just
    the ones they are committed to now? I think we can fulfil the
    strategy with our readiness levels that we demand for our
    forces. We will have to look closely at how we continue to
    train those forces under the current OPTEMPO.
        Senator Akaka. Thank you.
        Senator Inhofe.
        Senator Inhofe. Thank you, Mr. Chairman. There are so many
    things to talk about, and I know we are not going to be able to
    get to all of them, but I do not want to overlook this one.
    While we are all talking about the war that is going on that is
    so visible to the public, there is another war that has been
    going on for 3 years. I refer to that as the battle of Vieques.
        Admiral Krol and General Bedard, you are very familiar with
    this. First of all, I have spent a lot of time recently going
    to the U.S.S. JFK and the battle group that was deployed from
    the east coast. I was interested in the type of revised
    training they had since they were not able to do live-fire.
    They were able to initially do some training on Vieques, but
    not the integrated training that they wanted to.
        I talked to Commander Rothingham and Colonel LeFebure on
    the U.S.S. Wasp. In fact, they were kind enough to meet with us
    late at night and to go over some of the problems that they
    might have in training. I asked the question, if live-fire is a
    10 in terms of quality of training, what is inert? The response
    was fairly consistent that it is a five.
        We have a commitment to do the very best job of training
    our troops when they deploy. General Bedard, most of your time
    has been on the west coast, except, of course, when you were at
    Camp LeJeune when I was down there. But in terms of this
    training, I would like to have you tell us in each of your
    perspectives what you think about the quality of training that
    we have now as opposed to what we would have if we had the
    live-fire training that we should be having on that range that
    we own. Admiral Krol.
        Admiral Krol. Yes, sir. First, I agree with you completely
    about live-fire training, and I agree with what you were told
    from the ARG-MEU perspective, that live-fire training is,
    without a doubt, a 10 on a scale of 10. We have been prohibited
    from doing live-fire since we had the tragic accident in 1999.
    We continue with that prohibition on live-fire.
        In the recent months, discussion of live-fire has again
    come up. Of course, the CNO and the Commandant have been
    committed to returning to live-fire training. The real issue
    that we have been wrestling with post-September 11 is the
    accelerated deployment of the U.S.S. John F. Kennedy and the
    upcoming U.S.S. George Washington battle groups. These have
    really curtailed our ability to fully utilize Vieques because
    of the steaming time and the need to get those battle groups
    and their associated ARG-MEU on their way.
        The other aspect that makes things difficult is the
    bureaucratic requirements, if you will, that it would take to
    reinstitute live-fire training.
        Senator Inhofe. Admiral, I did not want to get into that,
    because I am fully aware of all of that. I am just talking
    about the quality of training. That is the question.
        Admiral Krol. There is no question that for the air wing
    and naval surface gunfire support, and I will let General
    Bedard answer for the Marines, that the live-fire training is a
    10 out of 10.
        Senator Inhofe. Unified?
        Admiral Krol. Unified, yes, sir.
        Senator Inhofe. That is what your air guys tell me. I was
    on the carriers and they said, ``We can have the best-trained
    men and women in all these different areas, but if they do not
    scrimmage together it is not going to be the team that we need
    to be able to deploy.''
        Admiral Krol. Integrated Joint Taskforce Exercises (JTFX)
    training in Vieques is the best training we can offer.
        Senator Inhofe. Thank you very much.
        General Bedard. Senator, as we discussed, I ran our live-
    fire maneuver training site at Twentynine Palms, California. I
    will just unequivocally say that nothing replaces live-fire.
    Our ability as a combined arms team to be able to train and
    integrate all of the fires that are capable of being produced
    by our naval expeditionary forces and to be able to integrate
    them with maneuver is something that is tied inextricably to
    the readiness of the force. It is something that needs to be
    done before our forces deploy anywhere from the continental
    United States, because we cannot assume they are going to have
    an opportunity to train somewhere else. They could be committed
    from the day they leave here.
        Senator Inhofe. I appreciate that, because I have gone to
    other places, such as Cappo del Lata in southern Sardinia and
    Cape Rath in northern Scotland. They are watching what is going
    on. I want to bring the Air Force and the Army in on this,
    because encroachment is a huge problem right now. We have
    talked about this, and certainly you are all aware of that.
        If we allow a bunch of law-breaking terrorists to close
    down a range that we own, that is going to have a domino effect
    on all ranges, domestic and foreign. I would ask both of you
    for your thoughts about your current situation with ranges and
    the deterioration from encroachment of all kinds and how you
    see this in the future.
        General McKiernan. I will begin by echoing everything that
    has been said about live-fire training. There is probably not a
    skill in my mind that is more important than a soldier being
    able to expertly fire his weapon individually and up through
    all the collective levels.
        In the Army, we feel that we have been good stewards of the
    environment. We are concerned about encroachment.
        Senator Inhofe. See, and that is the problem. You have been
    too good stewards. In Camp LeJeune, you do such a good job
    protecting the red cockaded woodpecker that there are more and
    we have more areas that are off limits now. Is that not
    correct?
        General McKiernan. Yes, sir, that is true.
        Senator Inhofe. Maybe you should not do such a good job.
        General McKiernan. Sir, in my most recent experience as a
    division commander at Fort Hood, Texas, we have a bird down
    there, the Vireo, not a particularly attractive bird, but it
    takes up about 33 percent of the maneuver and live-fire space
    at Fort Hood. This space cannot be used. We are not in favor of
    that, and we will really follow the OSD lead in working with
    Congress on encroachment issues. We are fully supportive of
    some of the initiatives that are being worked.
        General Wald. I agree with my colleagues. We have 41 ranges
    that we use in the United States Air Force today, and we are
    working closely with government agencies to ensure that those
    ranges remain open. They will be even more critical in the
    future in areas that we had not really thought of before.
        The frequency spectrum area becomes critical as well in the
    future because of high technology weapons. Some of the
    unintended consequences of a shrinking frequency spectrum
    become issues for the Air Force as well. But I could not agree
    more that without our people trained up in live-fire before
    they go to combat we are going to be not ready to go.
        As we start going back to September 11, we are expected to
    be ready within hours. The United States Air Force has most of
    its force ready to deploy within 72 hours of a crisis. The
    maintenance of a high state of readiness on a day to day basis
    is critical to us and those ranges are critical to us.
        Senator Inhofe. Thank you, General.
        Since we are going to be going into a closed session, let
    me just ask a question of each of you to be answered for the
    record at a later time. But it is very critical right now that
    each of you address this in one way or another. With the
    exception of you, General Bedard, the new budget does not
    really enhance the force structure. I was concerned just after
    the Balkans that the OPTEMPO of the Guard and Reserve meant we
    might be losing critical military occupational specialties
    (MOSs). Now, of course, they are great people and they are
    willing to serve, but there is going to become a time when the
    employers and these people are not going to be able to handle
    the OPTEMPO that the Reserve component is handling right now.
        There was a statement in the from an unidentified senior
    Air Force official who said that the Air Force needs an
    additional 30,000 people. It was broken down between 22,000
    Active, 6,000 Guard, and 2,000 Reservists to meet the future
    requirements. I would like to have each of you respond for the
    record. In the Air Force's case, you might just see whether or
    not you agree with those figures, because this is something we
    are going to have to be dealing with.
        I know we are doing the best we can, but the budget is
    inadequate in two major areas: endstrength and MILCON. If you
    could address that for the record for me, I would appreciate it
    very much.
        Thank you, Mr. Chairman.
        [The information referred to follows:]

        General McKiernan. The current operational environment places
    additional demands on the Army that were previously unrealized. Post-
    September 11 events have only increased demands placed on the force and
    the Army will likely require an endstrength increase to fully meet
    these demands.
        The Total Army Analysis (TAA) process will determine the size and
    composition of the Army within a constrained budget. The current
    effort, TAA 09, is not complete, but will account for the additional
    emerging requirements in the area of homeland security and the GWOT.
        To address the immediate need, the National Defense Authorization
    Act for Fiscal Year 2002 permits the Department of Defense to allow the
    services to exceed their endstrength by 2 percent in any fiscal year in
    which there is a war or national emergency. Taking full allowance of
    this provision would allow the Army to increase its Active component
    endstrength to 489,600.
        The Army can realistically increase recruiting by an additional
    4,000 soldiers per year in fiscal years 2003 and 2004 and address the
    most immediate needs of the GWOT and homeland security, provide relief
    for Reserve component soldiers, and allow more time to analyze enduring
    requirements.
        The global war on terrorism has validated many of our past
    investments, which are now paying dividends in terms of a trained and
    ready force. But it has also identified some shortfalls where
    additional resources will be needed to sustain a long-term effort and
    guarantee the safety and security of future generations. From that
    perspective, the Army's immediate military construction (MILCON)
    requirements to support current and future operations total about $735
    million. These projects span a range of areas from force protection to
    enhanced training facilities.
        We continue to review and validate force protection MILCON
    requirements, but the current list of qualifying projects totals about
    $110 million. Those projects are comprised of perimeter security,
    access control points, and facilities upgrades to meet specific force
    protection standards for blast mitigation and standoff distance. The
    projects reside in all three MILCON appropriations, with about $45.4
    million in military construction, Army (MCA), $51.6 million in military
    construction, Army Reserve (MCAR), and $13 million military
    construction, National Guard (MCNG).
        Current force protection requirements also include about $113
    million worth of unfunded projects that the Army had intended to fund
    with the fiscal year 2002 Defense Emergency Response Fund (DERF). These
    projects are predominantly cantonment area perimeter fencing which
    complement the upgrade and construction of new access control point
    facilities.
        The global war on terrorism has also intensified the importance of
    other projects that are necessary to insure the readiness of
    operational forces and permit rapid and efficient projection of those
    forces into the fight. Range operations and training enablers such as
    urban assault courses, close quarters combat facilities, and infantry
    squad battle courses are extremely important to the readiness of our
    forces. Current requirements for these training enablers total about
    $114 million.
        Projects necessary for force projection, such as deployment
    facilities, currently total about $88 million. In addition, other
    specific projects that are needed are projects to comply with
    environmental mitigation requirements at Kwajalein Atoll. These
    projects total about $14 million.
        Finally, in order to be able to react swiftly and decisively in all
    future operations, several projects totaling about $276.4 million are
    required to support Interim Brigade Combat Team (IBCT) fielding. These
    requirements continue to be revised in light of emerging operations and
    training issues and the refinement of the various scopes of work, but
    are accurate as of the date of this hearing.
        Admiral Krol. The Navy is deeply committed to providing adequate
    funding to (1) sustain our facilities in a current state of acceptable
    readiness and (2) replace and modernize those facilities, which have
    outlived their useful life and function. This year's budget request
    focuses on providing funding for sustaining facilities in a C1/C2
    condition readiness. Although the fiscal year 2003 MILCON budget
    request is lower than last year's budget, it is the second largest
    MILCON budget request in 6 years. The Navy is developing its future
    year's MILCON program such that the Navy can achieve the DOD goal of a
    67-year recapitalization rate by fiscal year 2007.

        Senator Akaka. Thank you. I thank you very much for rapidly
    moving on this. Let me ask this question and then we will move
    into the next part of our discussions.
        I have appreciated the concerns you have expressed about
    encroachment. As you have noted, a number of factors contribute
    to the problem, including noise, air space, frequency,
    environmental, cultural artifacts, birds, and other
    constraints. What steps are your services and the Department
    taking to identify a comprehensive solution to the issue of
    encroachment that attempts to address all of these concerns?
        How will all of these elements be reflected in the
    legislative proposal that you will be submitting later this
    year?
        General McKiernan.
        General McKiernan. Sir, first of all, we are working with
    OSD, who has the particular group that is approaching the
    issues of encroachment. We support all the initiatives that
    they will bring forward to Congress to ease some of those
    restrictions on our training, not only our live-fire training,
    but also our maneuver training. I am sure that it will come
    shortly.
        In the meantime, in my opinion, we have to maintain our
    effective stewardship of our resources or we will run the risk
    of not being able to train in several of these locations at
    all. But this is really a team effort with all the services and
    OSD.
        Senator Akaka. Admiral.
        Admiral Krol. Mr. Chairman, the General Counsel of the Navy
    is spearheading an effort to identify areas of concern and
    encroachment and put together a legislative package in
    conjunction with OSD. That is the long-term effort. The short-
    term effort is that the Navy has a large number of people that
    are working on a daily basis with organizations like the
    National Oceanic and Atmospheric Administration (NOAA), the
    National Marine Fisheries Service, and others. It is a constant
    give and take, and we are trying to show those organizations
    our good stewardship and interests in this area.
        But I think it is going to take legislative relief to
    establish some boundaries.
        Senator Akaka. General Bedard.
        General Bedard. Sir, we have a task group together at this
    time that is doing a number of things. First and foremost, we
    are trying to come up with a very valid assessment of what
    encroachment is doing to our training across the Marine Corps
    at our various installations. Of course, we are working with
    OSD to bring our facts to the table.
        Also, we have developed an outreach program at each of our
    facilities and installations showing what we are doing to, in
    fact, enforce those regulations that are placed upon us and are
    trying to be as forthcoming as we can as to the impact of these
    regulations on our forces.
        Senator Akaka. General Wald.
        General Wald. We, too, are working with local communities
    to ensure that they understand the mission and our effect on
    the environment. Along with OSD, we have a task force to work
    on ensuring that the range encroachment issue does not affect
    our training.
        We have been working with the Department of the Interior,
    as well as the Federal Communications Commission, to ensure
    that spectrum encroachment, which is more subtle, is well
    understood. We appreciate the subcommittee's support as we go
    forward with legislation through our General Counsel this year
    to ensure that spectrum is not encroached upon in our training.
        Senator Akaka. Thank you all for your testimony. Your
    insights today have helped to give us a better understanding of
    the challenges we face in ensuring the readiness of our
    military forces now and in the future.
        While the world focuses on Afghanistan, we have a
    responsibility to take both a broader and deeper view, broader
    in the sense that we must be mindful of the full range of our
    current commitments and deeper in the sense that we must
    balance what we do now against what we want to be able to do
    over the long-term.
        The tragedy on September 11 shifted our national priorities
    and added missions to responsibilities which were already
    demanding for our service men and women. The situation forces
    difficult choices, and we all must grapple with the tradeoffs
    and make responsible decisions to ensure that our forces have
    what they need to do what their country asks them to do today,
    tomorrow, and beyond. We appreciate your sharing your expertise
    with us.
        We are now going to move into closed session, which will
    begin in SR-222 in about 3 or 4 minutes.
        Thank you very much.
        [Questions for the record with answers supplied follow:]

                 Questions Submitted by Senator Daniel K. Akaka

                           PLAN TO TRANSFORM TRAINING

        1. Senator Akaka. Dr. Mayberry, your written statement says that
    the DOD has ``recently completed a strategic plan for transforming our
    training that will serve to guide the Department in ensuring our forces
    remain the best trained and most capable in the world.'' I am
    interested in what this strategy entails, how it might differ from
    current training methods, and whether any additional resources are
    required to support this strategy. What is the new strategy, what is
    required to make it work, what training problems is it intended to
    address, and how will it improve our training?
        Dr. Mayberry. What is the new strategy? The Training Transformation
    (T2) Strategic Plan identifies the high-level goals and broad steps
    needed to transform DOD training to meet the needs of the 21st century
    military. The Department's vision for T2 is to provide dynamic,
    capabilities-based training for the Department of Defense in support of
    national security requirements across the full spectrum of service,
    joint, interagency, intergovernmental, and multinational operations.
    The strategic goals are to:

             Provide comprehensive and systematic ``joint''
            training focused on the operational requirements of the
            combatant commanders (CINCs) and linked to readiness
            assessment.
             Develop a robust, networked, live, virtual, and
            constructive training and mission rehearsal environment that
            enables the Department of Defense to build unparalleled
            military capabilities that are knowledge-superior, adaptable,
            and lethal, and predicated upon service, interoperability, and
            CINC training requirements.
             Revise acquisition and other supporting processes to
            identify interfaces between training systems and acquisition,
            logistics, personnel, military education, and command and
            control processes, and ensure that these processes and systems
            are integrated.

        The training concepts outlined in the Training Transformation
    Strategic Plan are significantly different from those used to conduct
    training today. The approach emphasizes the mission requirements of the
    combatant commanders--the CINC is the customer. The intent is to be
    more output-focused in terms of the training needed to support the
    CINCs' requirements, missions, and capabilities, while preserving the
    ability of services to train on their core competencies. The focus of
    training transformation is to better enable joint operations in the
    future, where ``joint'' has a broader context than the traditional
    military definition of the term.
        What is required to make it work? Significant change often requires
    top down leadership and incentives to reward innovation and proactive
    realignment of resources. The Under Secretary of Defense for Personnel
    and Readiness [USD(P&R)] will organize and chair a T2 Implementation
    forum that will: (1) identify and track the progress of the specific
    tasks, responsibilities, resources, and timelines needed to carry out
    the near-, mid-, and long-term actions listed in the T2 Strategic Plan;
    and (2) establish a T2 Investment Strategy and oversee an Incentive
    Fund that encourages joint innovation, initiative, and substantive
    change. Specific costs of implementing T2 will be defined in greater
    depth in the next 12 months and incorporated into the defense budget.
        What training problems will it address? Joint training must be able
    to support a broad range of roles and responsibilities in military,
    multinational, interagency, and intergovernmental contexts, and the
    Department of Defense must provide such training to be truly flexible
    and operationally effective. Training readiness will be assessed and
    reported, not only in the traditional joint context, but also in view
    of this broader range of ``joint'' operations. Today, the Department
    does not formally plan, assess, and report joint and interoperability
    (service-to-service) training on a broad scale. Joint training and
    education will be recast as components of lifelong learning and made
    available to the Total Force--Active, Reserve, and DOD civilian. The
    Department will expand efforts to develop officers well versed in joint
    operational art. The interfaces between training systems and the
    acquisition process will be strengthened, so that training is not
    considered an afterthought or a bill payer. A forcing function will be
    established to cause explicit consideration of training throughout the
    acquisition cycle.
        How will it improve our training? The Strategic Plan establishes
    the Department's vision, strategic goals, and major steps needed to
    launch and implement the overarching training transformation. The
    lessons from combat teach us that if we are to be joint in wartime, we
    must be joint in our preparation for war. To do so effectively, we must
    transform the way we educate and train the men and women of the Armed
    Forces to ensure they have the knowledge and skills needed for 21st
    century military operations. Transforming training will require a
    higher-level focus--one that is driven by the CINC's operational needs.
    It will also require a different type of education and training
    environment--one that is highly adaptable, globally distributed, and
    synchronized with C\4\ISR [Command, Control, Communications, and
    Computers (C\4\), Intelligence, Surveillance, and Reconnaissance
    (ISR)]. The goal of transforming training won't happen over night, but
    we can do some things in the near-term that will amount to a quantum
    leap in warfighting capability. Additional benefits of investing in
    training transformation will also be far reaching, since training
    provides the foundation for attaining the Department's broader
    transformation objectives.

                     CAPABILITIES-BASED READINESS REPORTING

        2. Senator Akaka. Dr. Mayberry, on page 5 of your statement you
    recommend a ``capabilities-based'' readiness reporting system. How,
    specifically, will this differ from the current system? For example,
    would units report their capabilities to perform both their most
    stressful wartime missions for major theater wars as well as their
    ability to do peacekeeping and other missions? How would that differ
    from the current readiness reporting system where the training element
    is measured against specific wartime tasks? Please give specific
    examples of how capabilities would be both identified and then
    measured.
        Dr. Mayberry. The new Defense Readiness Reporting System (DRRS) is
    based on all DOD components reporting their readiness to meet mission
    essential tasks (METs) or like indicators. This construct requires all
    units to report readiness for their assigned missions, from the
    combatant commander down to the supporting Defense components. Once
    implemented, this approach will allow the Department to review specific
    force readiness to execute a given mission. These missions range from
    high intensity warfighting to peacekeeping operations. For example, a
    unit may be training on 6-to-12 mission essential tasks to support its
    assigned missions. Under DRRS, units are required to report their
    training readiness for each of these essential tasks. A unit could
    report they are not trained in METs supporting a high intensity war
    fight, but are fully trained in those essential tasks required for
    peacekeeping. That information will be visible to the combatant
    commander, who may be depending on that specific unit to execute
    elements of his war plan. The combatant commander could then adjust his
    war plans or call for a substitute unit that is fully trained and
    ready. As such, the DRRS can use this information to identify specific
    risks in executing assigned missions. This differs from the current
    system in a number of ways. Perhaps most significantly, the new DRRS
    covers all DOD components, meaning that readiness to meet mission
    assignments is reported not only by the Military Departments, but also
    by the combatant commanders and the defense agencies. Furthermore, DRRS
    enables a clean trace of METs to missions, and a near real time
    capability for readiness assessment. For the DRRS, ``capabilities'' are
    defined by collections of units and METs.

                             READINESS INITIATIVES

        3. Senator Akaka Dr. Mayberry, your testimony notes the creation of
    a new working group to help clarify the relationship between funding
    and unit readiness. You state that it just finished its first quarterly
    review of OPTEMPO funding. What were the results of that review?
        Dr. Mayberry. The results of the first quarter review of OPTEMPO
    execution did not show any major OPTEMPO execution or unit training
    issues.

        4. Senator Akaka. Dr. Mayberry, what milestones have been set for
    future actions by the new working group?
        Dr. Mayberry. We are in the process of redefining the group
    memebership to include more senior representation (General Officer/
    SES). With the new membership, we expect to facilitate the task of
    standardizing the OPTEMPO program and vetting potential new training
    metrics.

                             READINESS EVALUATIONS

        5. Senator Akaka. General Newbold, you testified that you are
    providing your views on the readiness of our Armed Forces to meet the
    national military strategy. Yet the current strategy was issued in
    1997--although it is, as you noted, under revision. Are you, in fact,
    evaluating readiness against a 1997 military strategy, or against some
    other yardstick, or both?
        General Newbold We began last fall to adjust our readiness
    assessment processes to the Secretary of Defense's direction on
    national military strategy as it was unfolding, even though we did not
    have an approved new strategy. The most current readiness assessment
    cycle assessed the readiness of our Armed Forces to meet the strategy
    outlined in the Secretary of Defense's final draft Contingency Planning
    Guidance and the Chairman's draft Joint Strategic Capabilities Plan. As
    the strategy is further refined, I fully expect that our readiness
    assessment process will make appropriate adjustments.

                             SPARE PARTS SHORTAGES

        6. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, please provide the latest information you have about
    shortages in critical spare parts, including engines and engine
    components, batteries, etc., as well as your assessment of how the
    funding in the fiscal year 2002 supplemental (if approved as requested)
    and the fiscal year 2003 budget request will address any shortfalls.
        General McKiernan. Critical spare parts shortages continue to
    threaten the readiness of soldiers and equipment. Spare and repair
    parts issues are beginning to show up in the Unit Status Reports. Of
    greater concern is the long lead-time associated with repairing and
    acquiring new spare parts. We began this year with a $1.3 billion spare
    parts shortfall, which we are working with Department of Defense (DOD)
    to fund. We have obtained a $300 million Obligation Authority since
    then and expect an additional $200 million in April 2002. However, we
    currently have a $215 million unfunded requirement (UFR) for the top
    100 aviation spares and $100 million UFR for the top 54 non-aviation
    spares. In addition, we have a $450 million UFR for other readiness
    requirements, $300 million for critical long lead-time parts for the
    fiscal year 2003, and $200 million for future readiness requirements.
    The $300 million provided to date has financed the fiscal year 2003
    recapitalization efforts, and the additional $200 million will be spent
    on aviation parts. We have a resourcing plan for the remaining $800
    million, which will cover the UFR for the non-aviation critical spares
    and other readiness spares, to include funding to increase and
    accelerate production for a critical battery shortage.
        We do not use the term ``readiness'' lightly. A recent Logistics
    Management Institute (LMI) study commissioned by the Army indicates a
    decline in readiness of our aviation fleet and significant increases in
    non-mission capable rates. Demand is growing beyond the anticipated
    rate of sales. There has been a $350 million growth in backorders from
    1997 to present. At the same time, Army Working Capitol Fund buying
    power is eroding. We are working internally and with Office of the
    Secretary of Defense to resolve our shortfall in a number of different
    ways in fiscal year 2002. Whatever part of our fiscal year 2002
    readiness spares requirement is left unsatisfied will carry over to
    fiscal year 2003. The Office of the Secretary of Defense (OSD) has
    plussed up the fiscal year 2003 budget by $100 million through a
    Program Budget Decision; however, it does not go far enough to address
    the significant spares funding shortfall or build essential inventory.
        General Bedard. For fixed wing assets, radar and targeting systems
    have provided the greatest challenge for sustainment of spare parts.
    For our rotary wing assets, transmissions, rotor heads, and hub
    assemblies have been the most challenging to sustain. All of these
    components are critical readiness degraders. Their availability
    requires a combination of a consistent funding stream along with a
    responsive system to meet fleet demands.
        With regard to aircraft engines, parts shortages continue to affect
    various engine programs. In addition, an insufficient inventory of
    engines has affected some of our communities, in particular our F/A-
    18As, F/A-18Ds, EA-6Bs, AV-8Bs, and CH-46Es. We are focusing on
    improving our methods of forecasting demands to ensure timely receipt
    of spare parts. Continued investments in engineering, logistics, and
    spare components/modules in fiscal year 2002 and fiscal year 2003, with
    out-year continuances, should yield significant paybacks in improved
    engine availability in fiscal year 2005 through fiscal year 2008, with
    reduction in required repair dollars in fiscal year 2008 beyond.
        Marine Aviation funds the replenishment of spare parts from Flight
    Hour Program (FHP) account. In both fiscal year 2002 and fiscal year
    2003, the FHP was funded to the stated CNO goal of 89 percent. Our APN-
    6 account, which provides funding for new allowances and increases in
    spare parts, is funded at 98.5 percent in the fiscal year 2003
    President's budget. We expect this level of APN-6 funding to provide
    more robust support for our deployable units. CONUS units have suffered
    from recent spare shortfalls, as we direct spare allowances to forward
    deployed units.
        The combination of additional fiscal year 2002 funding and
    requested fiscal year 2003 President's budget funding will enable
    Marine Aviation to improve the spare deficiencies and lead to improved
    readiness rates.
        Regarding our inventory of ground equipment, the Marine Corps does
    not currently have a shortfall with regard to funding of depot level
    repairables at the wholesale inventory level. Additionally, the retail
    inventory level should not experience significant shortfalls based on
    their current inventory level and financial resources due to the
    recently completed Integrated Logistics Capability Centralized
    Management of Secondary Repairables initiative, which established
    required retail stock levels. The Marine Corps has experienced
    difficulty in obtaining certain repairables, primarily in the
    communications and electronics commodity, due to diminishing
    manufacturing and/or repair sources. Additional funding may be required
    to alleviate shortages in critical repair parts until new replacements
    are in stock and fully integrated into the supply pipeline. If
    additional funding is needed, it will be identified through our
    resource requirement processes.
        General Wald. Improved spares funding is making a positive
    operational impact in the Air Force. The Air Force requested an
    additional $222 million in the fiscal year 2002 supplemental to
    reimburse the Air Reserve Forces for incremental flying hours flown to
    support the war on terrorism. Flying hour spares requirements received
    substantial funding for fiscal year 2003, to include $450 million to
    address both consumables and depot level repairable spares issues
    associated with supporting aging aircraft. In addition, the fiscal year
    2003 budget includes additional dollars for 11 spare engines for the C-
    17, and 4 spare fighter engines, 2 each for the F-15 and F-16. This
    funding will allow the Air Force to see continued improvements in
    readiness indicators.
        Admiral Krol. The most pressing need for Navy spares falls into two
    categories: spares to support equipment installed on Navy ships and
    spares to support Navy aircraft. Projected spares requirements
    following September 11 were approximately $435 million. $150 million
    was received in DERF funds, leaving a balance of $285 million which
    remains unfunded. Requirements reflected in the $34 million
    supplemental request are considered ``must funds.'' These must funds,
    if received, will be used primarily for incremental requirements driven
    by the war on terrorism. Whatever remains as an unfunded after the
    supplemental is received, the Navy will need to assess the criticality
    of each requirement against other competing requirements and may need
    to reprogram funds accordingly.
        Spares are placed aboard ship to support installed equipment. This
    is done so that repairs may be initiated and completed immediately.
    Without these spares, requisitions must be sent off-ship. Every time a
    requisition is sent off-ship and/or off site, the warfighter
    experiences some degree of customer wait time. This waiting means that
    the weapon system in question is either down or degraded to some
    extent. Simply put, readiness is degraded when waiting for a part.
    Supporting the range and depth of shipboard allowances improves
    readiness, surge capability, and sustainability.
        Supplemental funding would also be used to purchase aviation spare
    parts. This includes spares for such aircraft as the E-2C Hawkeye and
    F/A-18 Hornet. Both aircraft are flying longer hours and experiencing
    higher demand for spares. Ensuring we provide the warfighter sufficient
    spares to sustain deployed forces, as well as non-deployed, is
    paramount to Navy's readiness and surge capabilities.
        Without sufficient funding, readiness degradation will first occur
    among non-deployed forces since protecting our deployed units is our
    first priority. Consequently, protecting deployed readiness when
    insufficient funds are available has historically resulted in fewer
    parts to support the inter-deployment training cycle for future
    scheduled deployments.

                         COMPREHENSIVE LESSONS LEARNED

        7. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, our military operations in the post-Cold War world
    have proven to be diverse and challenging in many ways. What lessons
    have you begun to derive from our ongoing operations in the global war
    against terrorism, and perhaps more importantly, how do these relate to
    the lessons that we have learned from other major operations in the
    last 10 years?
        General McKiernan. Our review of the war on terrorism--and the
    diverse set of real challenges faced over the past decade--underscores
    our analysis that complex and compelling threats to our national
    security remain on the strategic horizon. These threats take a variety
    of forms and possess a diverse array of dangerous capabilities. Threats
    range from irresponsible state actors armed with potent conventional
    forces and Weapons of Mass Destruction (WMD) to more amorphous but no
    less threatening non-state entities pursuing their objectives outside
    the boundaries that long govern state behavior. The most recent
    undertaking indicates that the Nation will likely confront a multitude
    of stacked challenges occurring in rapid succession in discrete, often
    isolated, theaters. Each successive event will compound the complexity
    of the strategic choices facing civilian and military decision makers.
        Our lessons from operating in this environment over the past decade
    brings five valuable strategic lessons to the forefront: (1) The world
    looks to the United States for leadership in a crisis even to the point
    of hazarding inaction without our participation; (2) Only the U.S.
    possesses the requisite capabilities to undertake sustained, large-
    scale military operations worldwide to affect decisive resolutions; (3)
    U.S. interests will increasingly be threatened by complex state and
    non-state challenges leveraging asymmetry, ungoverned sanctuary and
    finally, unconventional methods, capabilities, and command structures;
    (4) Securing interests, influence, continued prosperity, and the safety
    of the American population requires dominant, robust, and responsive
    full-spectrum forces; and (5) The U.S. gains significant advantages by
    working closely with allies and friends to build strong relationships
    and common approaches to complex problems.
        Our recent past and current circumstances confirm the conclusions
    arrived at in the most recent joint vision. Today, ``fighting and
    winning the Nation's wars'' implies far more than a large-scale joint
    combat operations against capable conventional military opponents.
    While this remains the most compelling and challenging joint
    requirement, it only represents a single point on a broader spectrum of
    conflict. In an increasingly complex security environment, populated by
    a diverse range of opponents, ``fighting and winning'' more accurately
    implies dominating the full-spectrum of threats and challenges-from
    peace to war. Full-Spectrum Dominance seeks to prevail decisively over
    every possible opponent, mastering every step an adversary might
    attempt in escalation. Doing so requires the capability to operate
    under a variety of challenging conditions and in a number of complex
    competitive arenas. A full-spectrum dominant force must be as capable
    of replacing an irresponsible and aggressive regime, as it is
    comprehensively destroying a complex non-state entity or assisting in
    the decisive reduction of ungoverned sanctuary. Not only must the joint
    force be capable of swiftly defeating the initial efforts of
    irresponsible actors but further, it must retain the capability to
    undertake sustained, combat operations to decisively defeat full-
    spectrum opponents and establish and maintain the security conditions
    necessary for enduring crisis resolution.
        Recent experience--with its increasingly apparent demand for full-
    spectrum forces--confirms the imperative to transform. Transformation,
    however, must be undertaken not with a view of prevailing against those
    opponents we would prefer to confront but rather, to defeat those
    adversaries we will certainly be required to confront to secure the
    Nation's interests into the future. The Army is 3 years into a
    transformation focused on optimizing land forces for decisive action
    across the range of military operations. This transformation is driven
    by the demands of a complex environment and is enabled by leveraging
    innovation, leadership, the power of each individual, and advanced
    technology to create a deployable, versatile, lethal, survivable,
    agile, and supportable land force--dominant across the full-spectrum.
    Army transformation is underpinned by cultural changes as well-changes
    in the way we fight, in the way we are organized, and in the way we
    conduct our business practices--in short, changes that will
    institutionalize Army transformation as a continuous process.
        Our most recent experiences in Afghanistan, Pakistan, Yemen, the
    Balkans, the Philippines, and our own homeland prove unequivocally that
    the nature of war remains unchanged--fundamentally, a contest of human
    will, waged in pursuit of power and control over territory,
    populations, resoures, and ideas. Further, it is clear that today's war
    on terrorism is not an aberration but rather a clear indication of the
    persistent conflict that will increasingly encroach on the security of
    the United States and its interests. The Nation and its Armed Forces
    are discovering that while it is imperative that we remain prepared to
    defeat those threats applying decidedly conventional approaches to
    warfare, our responsibilities further demand that we optimize to
    confront threats across a broader spectrum. The Army understands that
    our first priority is winning large-scale combat operations against
    capable state opponents. However, the war against terrorism has proven
    unambiguously that paramilitaries, factions, sects, and tribes vice
    traditional armies are just as likely to threaten American interests in
    strategically significant ways. Therefore, the Nation demands a joint
    force comprised of versatile units capable of sustained operations to
    affect their decisive defeat as well. While there is an allure to
    leveraging platforms over people, a decade of experience has shown that
    the vast majority of antagonists leverage people as their comparative
    advantage. Therefore, only robust full-spectrum forces, properly
    trained and equipped, are likely to master the wide variety of
    challenges the Nation is likely to face.
        General Bedard. Lesson 1: Our plans for transformation are on
    track, based on the feedback we have gathered from Marines throughout
    the Marine Air-Ground Task Force (MAGTF). We were previously asked if
    our transformation plans had been altered by what we had learned to
    date in the global war on terrorism, and our response there applies
    aptly to this question as well. Operation Enduring Freedom (OEF) has
    solidified our view that Marine forces are uniquely suited for the type
    of enemy encountered during Operation Enduring Freedom. Our
    expeditionary warfare capability gave the Nation the ability to
    immediately meet the enemy, operate from his terrain, and defeat him.
    Marines relied heavily on our expeditionary ethos, maneuver warfare
    philosophy, and naval heritage, resulting in an ability to operate
    miles from the battlefield, deep inland, without the reliance on static
    land bases. Sea-basing Marines and their assets gave commanders a
    secure platform from which to operate and a reliable source of support.
    Our planned transformation, identified a decade ago and adjusted from
    operational experiences since then, improves dramatically the
    capabilities showed during OEF.
        Lesson 2: Marine forces are a genuine joint force enabler,
    providing the joint force commander a wide variety of service-unique
    assets for immediate tasking. During OEF, the Marine Corps arrived in
    theater quickly with a capable force, fully prepared for integration
    into the joint environment. Marine units provided helicopter support
    for U.S. Army units and Special Operations Forces (SOF), and Marine
    fixed-wing aviation operated jointly with carrier-based Navy aircraft.
    Marine Expeditionary Units (MEUs), containing elements from all
    warfighting areas--command and control, aviation, ground combat, and
    combat service support--provided combat forces for operations,
    logistical support for other service forces on the ground, and command
    and control functions for a joint task force. The Commandant of the
    Marine Corps (CMC) has thoroughly addressed this issue in a recent
    article entitled ``Strength in Diversity,'' published in the April 2002
    issue of the Armed Forces Journal, saying that the services must
    continue to provide unique and complimentary capabilities to preserve
    the Nation's warfighting advantage. As pointed out by the CMC, CINCs
    will continue to look to employ Marine forces when the joint force is
    faced with an objective area with limited infrastructure, lack of fixed
    ports and bases, and austere conditions.
        Lesson 3: Joint commanders need a rapidly deployable and dedicated
    anti-terrorism force. In response to this requirement, the Marine Corps
    established the Fourth Marine Expeditionary Brigade (Anti-Terrorism)
    [4th MEB (AT)], a powerful combined-arms team prepared for worldwide
    anti-terrorism operations. The 4th MEB (AT) provides dedicated
    personnel with the requisite expertise to deter, detect, defend, and
    conduct initial incident response to combat the threat of worldwide
    terrorism. The 4th MEB (AT) merged the existing capabilities of the
    Marine Security Guard Battalion, Marine Corps Security Forces
    Battalion, and Chemical Biological Incident Response Force, and added
    an organic air component, combat service support element, and an
    infantry battalion, as well as a command element with dedicated
    planners, coordinators, and liaison officers. The 4th MEB (AT) is
    capable of conducting missions worldwide and is intimately woven into
    the ongoing homeland defense effort.
        Lesson 4: USMC support of Special Forces was limited due to
    insufficient training with one another prior to OEF. The Aviation
    Combat Element (ACE) of the MEUs had not trained with SOF units prior
    to arriving in theater. The ``workarounds'' to this situation included
    the units briefing their capabilities and limitations to each other and
    the use of individuals functioning as liaison officers. To fully
    develop the relationship between the ACE and SOF units, deploying MEUs
    may introduce SOF integration training as part of the MEU (SOC) pre-
    deployment training package (PTP).
        Lesson 5: Precision Guided Weapons/Munitions were the weapons of
    choice for Operation Enduring Freedom, specifically the novel use of
    JDAM as a close air support (CAS) weapon. Although generally effective,
    the use of Joint Direct Attack Munition (JDAM) had a number of
    limitations that will require immediate attention. There were several
    fatal friendly fire incidents, most involving JDAM CAS. Many Tactical
    Air Control Parties (TACP) did not expect to use JDAM for CAS, let
    alone CAS at ranges considered ``danger close,'' and TACPs were not
    thoroughly familiar with the procedures used by other services to
    report friendly locations, enemy locations, and direct the final
    approach of bomb-laden aircraft. Additionally, Marine TACPs have
    reported a requirement for an improved, lighter-weight device for
    designating targets for precision-guided munitions. The Marine Corps
    will continue to work with the other services on a joint tactics,
    techniques, and procedures manual that addresses the lessons learned
    from OEF. Finally, the Marine Corps will continue to work to improve
    live opportunities for close air support with all services and
    aircraft, using combat munitions, tactics, and procedures.
        General Wald. We have learned that unprecedented persistence and
    speed of execution can deny sanctuary to terrorists. In this particular
    environment and against this enemy, we also acknowledge the challenge
    will be more difficult against a more modern and sophisticated air
    defense and in jungle or urban terrain. But, our success addresses one
    of the six key Quadrennial Defense Review Transformation initiatives:
    ``Deny enemies sanctuary by providing persistent surveillance,
    tracking, and rapid engagement.''
        This persistence of air and space power in Afghanistan is
    unprecedented. Since the earliest aerial engagements, airmen have
    always sought to attain air superiority as the enabler for the freedom
    to maneuver and the freedom from attack from above. In the Afghanistan
    area of operations, coalition air forces quickly achieved air
    superiority--literally within the first few hours. Once the coalition
    destroyed enemy fighter aircraft and ground-based radars and related
    air defense threats, the Combined/Joint Force Air Component Commander
    (C/JFACC) began to exploit the advantage. He optimized ingress and
    egress routes for fighters and bombers, allowed aerial refueling
    aircraft and other high-value aircraft to orbit much closer to the
    action than otherwise, and extracted leverage from technological
    advances that expedite the sensor-to-shooter ``kill chain.'' The
    results are unprecedented persistence over the battlespace and speed of
    execution as reflected in the nearly constant presence of overhead
    platforms capable of sensing enemy actions and reacting within minutes
    to produce an intended effect. There are intelligence, surveillance,
    and reconnaissance platforms overhead, some manned and others unmanned,
    as well as fighters or bombers loaded with precision-guided weapons and
    fully capable of loitering or maneuvering-literally with impunity. This
    unprecedented persistence enables the C/JFACC to make targeting or
    attack decisions, or when necessary, to make recommendations to
    appropriate authorities, within minutes. As stages of the familiar OODA
    loop (observe--orient--decide--act) are compressed to permit faster,
    more agile decision-making, the C/JFACC is a direct beneficiary. Just
    as importantly, various other attributes contribute to success under
    persistent air superiority.
        Air and space superiority remains the key enabler for persistent
    ISR and precision strike capabilities. Key to a sanctuary denial
    strategy was our ability to loiter high-value assets, like AWACS, Rivet
    Joints, Joint Stars, U-2s, and UAVs, as well as tankers, bombers, and
    fighters persistently over the battlespace. We were also able to
    infiltrate, support, and exfiltrate entirely by air. Our special
    operations forces behind enemy lines conducted strategic
    reconnaissance, direct attack, and unconventional warfare missions
    directly supporting the larger ISR and precision strike efforts. Air
    and space superiority enabled not only that strategy, but also those
    missions.
        Near seamless integration of targeting-quality information sharply
    reduces the ``kill chain.'' Our investment strategies for ISR,
    communications, ground- and air-based sensors, coupled with efforts to
    organize, train, and equip the combined air operations center (CAOC) as
    a ``weapon system'' have resulted in unprecedented speed of execution.
    Our ability to find, fix, track, target, engage, and assess (F2T2EA)
    emerging targets is vastly improved . . . enhanced even more by special
    operations forces. We expect further improvement by relying more on
    machine-to-machine horizontal integration of sensors and shooters.
        A combination of ``eyes on the ground'' and all-weather weapons at
    their command enables rapid and precise surveillance, tracking, and
    target engagement. Air Force combat controllers working with Army
    special forces and other personnel proved to be an important enabler.
    Enhanced bombing effectiveness, demonstrated resolve, compliance with
    rules of engagement (ROE), immediate battle damage assessment (BDA),
    and airspace control were some of the key benefits ultimately resulting
    in a regime change. Versatile all-weather global positioning system
    (GPS) satellite-guided 2,000-pound class JDAMs greatly reduced weather
    and underground sanctuaries. Moreover, we had ``airmen'' on the ground
    empowered to execute and command other ``airmen'' in support of
    counterland missions to achieve specific effects.
        A versatile, flexible, and expeditionary force can rapidly deploy,
    seize the initiative, defeat a regime, disrupt key terrorist activity,
    and deny sanctuary. By relying upon the Air Force's expeditionary
    aerospace force (EAF) concept, and by pursuing effective recruiting and
    retention initiatives, the expeditionary forces are postured for
    success.
        In comparison to other major operations of the last 10 years, such
    as Operation Allied Force, we fought these operations with a different
    U.S. Air Force--in terms of strength, equipment, force deployment, and
    other factors. We underscored the success of these operations with
    modernization and extraordinary acquisitions in new weapon systems. The
    Global Hawk, extended tether to U-2s, Predator's streaming video feeds
    to AC-130s and elsewhere, ability to exploit Blue Force Tracker and
    other capabilities made a substantial difference in our ability to
    prosecute this exceptional operation. Cross-cueing between several
    intelligence, surveillance, and reconnaissance sensors and weapon
    system platforms has widened perspectives and enhanced operational
    decision-making. The C-17 has again confirmed its exceptional
    contribution to air mobility by relying upon its capabilities of reach,
    airlift capacity, and flexibility. Delivered by long-range bombers and
    tactical fighter aircraft, the joint direct attack munition, guided by
    global positioning satellites, provided uncanny accuracy and enough
    precision to deny sanctuary to the Taliban and al Qaeda--despite caves,
    weather, dirt cover, or difficult locations in urban centers. Over the
    last decade, the favorable trend continues; we have developed greater
    and greater capability to deny the enemy sanctuary--regardless of his
    location or cover and in any kind of weather.
        We have stood up Task Force Enduring Look to gather data and
    information and to learn lessons that will apply in future operations.
    But, our Air Force Chief of Staff often quotes the U.S. Navy Chief of
    Naval Operations, who said, ``This war is like this war. It ain't like
    the last one, and it ain't like the next one. It is like this one.''
        Admiral Krol. While we continue to study and analyze the lessons
    from OEF, early analysis indicates that this is a war where the Navy
    was crucial to every facet of operations, all in this land-locked
    country, far from the sea.

    Lessons learned from Operation Enduring Freedom have highlighted that
    this was:

             A strike war where carrier-based airpower was the lead
            player in tactical strike.
             A SOF war where Naval Special Warfare (NSW) forces at
            times constituted the majority of U.S. Armed Forces in country;
             A coalition war where the Navy led the maritime
            coalition of 11 nations, and the Naval Special Warfare Group
            led coalition SOF in Afghanistan as Task Force K-Bar.
             An expeditionary war where the Navy's immediately
            deployable and employable nature was a major factor in the
            ground war in this land-locked country. For example, for a
            period of time there were more sailors in Afghanistan, a land-
            locked country hundreds of miles from the sea, than there were
            soldiers, airmen, or marines. Besides Naval Special Warfare,
            other Navy forces contributed significantly to operations
            ashore:

                     Carrier-based HH-60s were deployed ashore to
                    provide Combat Search and Rescue capabilities to joint
                    forces;
                     The Navy's rapidly deployable and full-mission
                    capable Explosive Ordnance Disposal were the EOD force
                    of choice;
                     The Navy provided the first significant
                    medical capability in Bagram and Kandahar;
                     Navy Construction Battalions (SEABEEs) built
                    up the runway at Bagram and repaired the runway at
                    Kandahar to facilitate the ingress of forces from the
                    other services, and built the detainee facility at
                    Kandahar;
                     Mobile Communications Teams supported Naval
                    units around the country; and
                     For a significant period in the war, the Navy
                    provided tactical weather services for all in-country
                    forces.

             Hence, like the ``Sand Pebbles'' days of old, this war
            marked the return of the ``Expeditionary Sailor.''

    The Navy was also a critical player in several turning points of the
    war, including:

             Navy TACAIR supporting Dostam's taking of Mazar e
            Sharif and motivates other warlords to move out.
             The Navy/Marine Corps team (Task Force 58) inserting
            into Camp Rhino, breaking the Kandahar stronghold stalemate.

    In the first 6 months, the Navy contribution has been enormous. As of
    early April 2002:

             More than half the active carrier force (6 of 11) has
            deployed and been engaged in combat operations (Enterprise,
            Vinson, Kitty Hawk, Theodore Roosevelt, Stennis, and Kennedy);
             4 of 12 Amphibious Ready Groups have been engaged
            (Peleliu, Bataan, Bonhomme Richard, and Wasp);
             60,000 sailors and marines have deployed to CENTCOM
            cumulatively (with about 31,000 present today);
             13,000 Navy and Marine reservists have been mobilized;
             The Navy has flown 7,000 strike sorties (and has flown
            11,000 total sorties);
             The Navy dropped 5,000 PGMs, 600 unguided munitions,
            and shot 88 Tomahawks;
             The Navy conducted more than 6,900 Maritime
            Interdiction Operations and Leadership Interdiction Operations
            ``queries''; and
             The senior U.S. military official on the ground in
            Afghanistan for almost a month was a Navy admiral.

    But the war also brought its share of challenges:

             Although the percentage of naval forces underway and
            deployed have remained near historic averages, with 40-50
            percent underway and about 30-35 percent deployed, the
            operating tempo (OPTEMPO) of deployed units is up sharply, with
            steaming days up about 50 percent (from 54 days/quarter to over
            80), and flying hours of deployed units peaking at about 250
            hours/day, and averaging about 115 hours/day; and
             The strike effort has stressed our precision-guided
            munitions (PGM) inventories and aircraft engine pools.
    Comparing Lessons Learned From Operation Enduring Freedom and Operation
            Allied Force
        The Navy comparison of OEF lessons learned with Operation Allied
    Force (OAF) lessons learned indicates that the Navy has effectively
    implemented most of the lessons from the earlier conflict.

    Areas where the Navy has improved significantly since OAF:

             Navy forces leveraged TACAIR responsiveness inside the
            Air Tasking Order planning cycle;
             The Navy contributed significantly to airborne
            surveillance and reconnaissance in Afghanistan; and
             The Navy developed several TACAIR doctrine
            modifications to allow us to use carrier-based air in ways
            never before envisioned, including through-the-weather weapons
            delivery, Navy fighters passing target coordinates to Air Force
            bombers, and coordinated remote lasing tactics.

        However, there are still some lessons from Operation Allied Force
    that have not yet been adequately addressed. Some will require years of
    effort to fix, while others can be improved upon in the near-term:

             The United States still does not possess enough UAVs,
            and the Navy does not possess organic UAVs. Even if the number
            of UAVs is increased, the U.S. military does not have
            sufficient bandwidth to take advantage of the number of UAVs we
            would need to replace even a modest number of manned aircraft;
             We need to improve interoperability with allies for
            networking, particularly aboard ship;
             There is still a shortage of GPS munitions;
             There is still a shortage of linguists, targeteers,
            and analysts;
             There continues to be a competition between conflict
            and war-time reserve munitions; and
             The single significant limiting factor to conducting
            operations in both wars was a lack of timely intelligence of
            sufficient granularity to identify and seize key leaders or
            make informed operational decisions. This kind of action
            requires people on the ground--national systems do little to
            provide the kind of information needed to apprehend bright
            people who don't want to be caught.

        As I said earlier, the Navy continues to analyze lessons learned
    from OEF. Although this work is expected to continue for some time,
    some early themes are emerging:

             We need to improve ISR to both theater decision-makers
            and trigger-puller;
             We need to establish Maritime Interdiction Operations
            as a core competency, to better prepare crews for conducting
            these vital operations;
             We need to continue to improve the integration of
            joint Special Operations Forces with Navy conventional forces;
             We need to continue to improve coalition
            interoperability;
             We need to adjust training somewhat for emerging
            missions;
             We need to improve the expeditionary sailor's
            deployability, uniforms, and equipment;
             We need to continue to work with the Joint Staff and
            the Office of the Secretary of Defense to improve joint command
            and control capability;
             We need to improve the sustainability of Naval forces;
            and
             We may need to make organizational alignments to
            better support the warrior forward.

                           STRATEGIC READINESS SYSTEM

        8. Senator Akaka. General McKiernan, please provide additional
    details on how the Strategic Readiness System (SRS) differs from
    current readiness assessment metrics, what costs are associated with
    implementing the new system, and how, specifically, it will improve
    visibility into readiness.
        General McKiernan. The current readiness reporting system provides
    an incomplete picture of readiness because it covers only the combat
    units at a snapshot in time. Our current system is based on the ability
    of our operational or combat units to perform their wartime missions;
    it provides a lagging measure of the status of resources and
    performance; and the information is limited to specific resource and
    training indicators of these units. The SRS will revolutionize the way
    we view readiness across the entire Army, both operational and
    institutional, by operating on two levels. The first level identifies
    the strategic objectives and key processes in a unit. It is based on a
    ``balanced scorecard,'' a tool that requires each Army unit at the
    division/separate brigade level and higher to enumerate its strategic
    objectives and performance measures and align them with the Army
    scorecard. Each unit will then monitor its readiness against the Army
    scorecard. The second level of SRS is data collection. After units from
    across the Army identify what is important, software collects the data
    that indicates the level of an organization's readiness toward
    achieving the Army's strategic goals. The cost for this year is set at
    $6.756 million to develop and implement SRS across the Army. Within
    industry, the sound business practice of a ``balanced scorecard'' has
    strategically focused the organization and data collection on what is
    important, in near real-time, in a leading or predictive manner that
    allows leaders to make policy and resource decisions before an issue
    becomes a crisis.

        9. Senator Akaka. General Wald, the Joint Staff reports that the
    DOD will reduce combat air patrols (CAPs) over the United States from
    post-September 11 levels. Can you please discuss how these reductions
    will be implemented? Also, the fiscal year 2003 budget request included
    $1.2 billion to continue to fly CAPs at the higher levels. What will
    the fiscal year 2003 costs be now that CAPs are to be reduced?
        General Wald. In April 2002, Commander, NORAD, in conjunction with
    the Joint Staff and approved by the Secretary of Defense, established a
    tiered response system for aerospace defense of the United States. Each
    tier in the system specifies the number of intercept, tanker, and
    airborne early warning aircraft. Additionally, each tier identifies the
    response time of alert aircraft, number of locations, and timing to
    achieve a higher level of response. As the assessed threat decreases,
    the corresponding tier employed by NORAD changes accordingly and the
    number of tasked bases, aircraft, and personnel decreases. From post-
    September 11, 2001, until April 2002, NORAD had a single level of
    response. The current NORAD response posture and the specific number of
    bases, aircraft, and personnel tasked are classified. Based on the
    approved concept of operations supporting a reduced level of combat air
    patrols over the United States, the Air Force has revised its $1.2
    billion fiscal year 2003 budget request for CAP to $522 million.

        10. Senator Akaka. General Wald, your testimony notes the major
    role the Air Force has played in Operation Noble Eagle by flying CAP
    missions. What has been the impact of flying those missions on the Air
    Force's normal rotational deployment plans for Expeditionary Air
    Forces? What have been the effects on the ability of the pilots to
    conduct combat training, on the aircraft themselves, and on the Reserve
    components?
        General Wald. The leading indicators of overall readiness are
    showing signs of decline. As of June 1, 2002, overall Air Force
    readiness declined 5 percentage points since September 1, 2001.
    However, major combat unit readiness decreased 1 percentage point over
    this same period. Regarding how this effects the Air Expeditionary
    Force (AEF) rotation, the combination of multiple crisis operations and
    our ongoing steady state commitments has placed extraordinary stress on
    the Expeditionary Air Force and our resources. In some stressed
    functional areas, requirements exceed available AEF cycle forces. The
    Air Force is committed to finding solutions to relieve the stress on
    these career fields. However, at this time, not all of the Air Force
    personnel in these stressed career fields can rotate to fill all
    current requirements
        Although the number of Operation Noble Eagle (ONE) taskings is
    decreasing, the long-term impacts are now beginning to manifest
    themselves in the total force, primarily affecting our Air Reserve
    component. These units continue to bear the majority of the burden for
    CAP taskings and are experiencing decreased training opportunities for
    major weapon systems involved. Our Air National Guard commanders are
    prorating training requirements in order to maintain combat mission
    ready status for aircrews. These units are placing priority on
    maintaining currency and employing a back-to-basics approach to
    preserve mission ready status. For the aircraft, additional spare parts
    funding had a positive impact; however, the increased OPTEMPO is
    working against readiness. The OPTEMPO increased support requirements
    resulting in significant utilization rate increases on high-demand
    Mission Design Series. Likewise, it has strained and overtasked a
    workforce that was short in S-level manning (and over-manned three
    levels) across critical maintenance Air Force Specialty Codes (AFSCs).
    Nevertheless, our maintainers accomplished their mission. Additionally,
    CAP taskings are also affecting retention rates within the Reserves.
    The longer the Reserve Forces remain activated, the lower the retention
    rate. A lower retention rate will require more training to reconstitute
    the unit. The Air Force is aggressively examining ways to use the AEF
    construct, DOD directed training transformation, and the accompanying
    budgeting process to mitigate the effect of high OPTEMPO on readiness.
    Sufficient and sustained congressional support would facilitate the
    essential readiness and other improvements the Air Force needs to
    continue to train quality combat pilots, and remain the world's
    preeminent air and space force.

                               BALANCING MISSIONS

        11. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, one of the main objectives of this hearing was to
    learn more about how you are managing the task of performing the new
    missions of the war on terrorism on top of all your existing missions.
    We have discussed the resulting short-term strains you encounter today.
    As we look out over the longer term, I see three possible ways forward:
    cutting back on other missions or activities; increasing our
    capabilities; or some mix of the two. What are your thoughts about the
    direction in which we should head?
        General McKiernan. It is probably a mix of the two. Successful
    prosecution of the war on terrorism requires the capabilities the Army
    contributes to the joint force. Executing the national security and
    military strategies over the previous decade of the 1990s required a
    greater number and type of deployments for the Army. The emerging
    defense strategy seeks to focus our efforts and resources on those
    activities that best support our national interests, especially as they
    contribute to the war on terrorism. Threats today range from
    potentially dangerous state actors armed with potent conventional
    forces and Weapons of Mass Destruction (WMD), to non-state entities
    pursuing their objectives outside the boundaries that govern state
    behavior. In the Balkans, the mission has scaled back in size to more
    manageable and predictable rotations with some decrease in operations
    tempo (OPTEMPO), and we anticipate this trend may continue. The
    Multinational Force and Observer mission in the Sinai has been at
    steady state for quite some time and not all of the force requirements
    for this mission are rotational. Deployments to Central Asia in support
    of Operation Enduring Freedom have begun to stabilize, as have security
    missions in the homeland. As the war continues, if and when we are
    called upon to execute other missions, we will ensure the Army is
    capable of meeting those requirements. The Army is closely managing its
    deployments and rotations to support the combatant commanders. As we
    proceed over time in this campaign to defeat terrorism on a global
    scale, the Army will incorporate the lessons learned into our processes
    in building and sustaining the total force. Likewise, we are already
    taking actions to increase our special operating force capabilities,
    intelligence assets, and conventional force capabilities required for
    securing the homeland, and will continue to do so. The Army's ability
    to increase capabilities to dominate across the spectrum of operations
    over the long-term will be accomplished through a comprehensive Army
    transformation.
        General Bedard. Currently, we have over 32,000 marines forward
    based, stationed, or deployed throughout the world. Each one of these
    marines is employed in direct support of either the combatant
    commander's immediate requirements (to include the war on terrorism) or
    his regional engagement program that contributes to the maintenance of
    long-term security within the Area of Responsibility. The Marine Corps
    is not reducing our current commitments, and with our forward deployed
    Marine Expeditionary Units, we are fully supporting the war on
    terrorism.
        The Marine Corps has and will continue to pursue programs which we
    feel will allow us to increase our capability to maintain a robust
    forward presence, operate in a joint or multinational environment, and
    act as a force multiplier for the combatant commanders. It is important
    that we maintain our forward engagement strategy with our Marine
    Expeditionary Units and our forward deployed marines. Coupled with
    future innovations, this will allow the Marine Corps to perform our
    current missions as well as new missions which will surface in the war
    on terrorism.
        General Wald. Prior to the attacks of September 11, the USAF
    maintained a number of worldwide steady-state responsibilities,
    including enforcing the no-fly zones over Iraq, patrolling the skies
    over the Balkans, supporting counterdrug efforts, and conducting
    humanitarian operations worldwide. After the attacks, the war on
    terrorism has added a new series of demands, including stateside combat
    air patrol, combat operations and related support, and
    counterterrorism-related missions worldwide. This high OPTEMPO is being
    inflicted on a force structure that was not built to handle this level
    of worldwide tasking, which may adversely affect recent gains made in
    readiness, and will certainly have an impact on both hardware and
    people. Unprecedented demands are being placed on our aircraft and
    people, necessitating the use of stop loss and increased reliance on
    the Reserve component. In order to handle a new ``steady-state'' demand
    level, the Air Force will either have to cut back on the number and
    types of missions that we do worldwide, or increase our force structure
    to accommodate the new demand. A determination will have to be made
    with respect to the new steady state or long-term demand on the USAF,
    and then we will have to examine the force structure in the context of
    the Defense Planning Guidance (DPG), Air Force transformation roadmap
    and modernization plans, and national security strategy.
        Admiral Krol. We need to seek a mix of increased capabilities,
    while closely examining our current missions and activities for
    possible efficiencies. Recognizing that resources are limited and we
    can't afford everything, we must continue to seek new technology to
    improve our capabilities while making some hard choices on missions and
    activities we no longer can support at current levels.
        First and foremost is the Navy and Marine Corps team's unique
    position as a forward deployed force. We were already forward deployed
    when the war on terrorism commenced and as a result had forces in
    theater ready to respond immediately. We initially refocused those
    assets on the CINC's tasking, while at the same time readying
    additional assets for deployment. Our intention is to remain a forward
    deployed force in the future.
        Our current global war on terrorism planning effort in support of
    CINC requirements includes numerous scenarios and contingencies,
    including how to sustain the war effort. This has resulted in a mix of
    prioritizing military efforts around the globe due to finite resources
    and analyzing how to improve our capability to support potential future
    additional tasking. Some CINC plans, if executed, would require a
    cutback on current missions to divert additional resources.

        12. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, General McKiernan's testimony suggests that we might
    cut back our support for the multinational observer force in the Sinai,
    or in the Balkans. Are there other activities that we might reduce?
    Conversely, what additional capabilities might be required?
        General McKiernan. As mentioned, the Army's requirements in the
    Balkans continue to be reduced. These reductions are a result of
    periodic mission requirement reviews in which we and our allies and
    partners have determined that the current situation requires less force
    to successfully execute the military missions. As the war on terrorism
    progresses, the Army in concert with other services, allies, and
    partners will continue to assess the situation within our operating
    areas to determine the feasibility for reducing force requirements
    without risking our ability to successfully execute our assigned
    missions. These assessments may reveal that reductions are not feasible
    and increases are required. It is difficult to identify these
    adjustments without a clear understanding of new missions. But, the
    Army's ability to tailor for diverse missions across force capabilities
    and to employ a mix of Active and Reserve component forces remains an
    inherent strength of this service.
        General Bedard. In my statement, I commented on the value of
    forward deployed forces. The expeditionary nature of forward deployed
    marine forces provides combatant commanders with a focused, versatile,
    and responsive capability during crisis situations. While certain
    situations may require marine forces to conduct sustained land
    operations, these operations are traditionally conducted by our
    Nation's war-winning Army. Since marines have had limited, short
    duration involvement in multinational and United Nations missions, it
    would be more appropriate for others to comment on the types of
    activities that could be reduced.
        With respect to additional capabilities, we created our 4th Marine
    Expeditionary Brigade (Anti-Terrorism) to address the requirement for a
    rapidly deployable and employable anti-terrorism capability both within
    the United States and overseas. By combining our State Department-
    focused Marine Security Guard Battalion, our Marine Security Force
    Battalion, which is under the operational control of the Chief of Naval
    Operations, the Chemical and Biological Incident Response Force, and by
    converting an infantry battalion to an anti-terrorism battalion, the
    Marine Corps is realizing a synergy of capabilities that provides a
    bonafide anti-terrorism capability to our Nation. So pressing was this
    need, in fact, that the Marine Corps asked for an endstrength addition
    of 2,400 marines for fiscal year 2003. This was one capability where we
    identified that additional support was required to meet an emerging
    requirement.
        General Wald. The United States must beware of open-ended
    deployments that continue to stress the force when combined with
    emerging contingencies. The presence of the observer force is an
    example of a deployment that has lasted for more than two decades and
    may have outlived its usefulness. U.S. deployments in both Kosovo and
    Bosnia may also be examined to see if their size and nature is
    appropriate. Consideration should also be given to the stake held in
    certain regions by our allies: NATO support has been critical to the
    stabilization missions in the Former Yugoslavia, and given the
    increased global demands on U.S. forces it might be reasonable to ask
    allies to shoulder more of the burden for peacekeeping-like duties. It
    is also important to exercise caution with respect to ``activities''
    suitable for cutting--it would be dangerous to cut training and
    exercise activity.
        Admiral Krol. Neither the multinational observer forces in the
    Sinai nor the Balkans are heavy draws upon naval forces. Other
    requirements for naval forces have to be evaluated in a global context.
    By design, the Navy is a forward deployed force and as such is prepared
    and on scene to respond when required by CINCs worldwide. The aggregate
    of global requirements has to be continually prioritized and evaluated
    against finite resources. During this continuous process the tasking
    with the least priority is at risk to not be supported. Decisions are
    routinely vetted with the Joint Staff. Additional ships and aircraft
    would relieve stress and provide additional capabilities to support
    CINC requirements.

                           FLYING HOURS REQUIREMENTS

        13. Senator Akaka. General Wald, a March 4 article in the Air Force
    Times describes Air Combat Command standards for how many training
    sorties pilots of various skill levels must fly annually to retain
    their mission capable (MC) status--for example, that junior pilots must
    fly 120 training sorties each year to be MC. Does your budget request
    fully support all of the training sorties that your current mix of
    pilots, both experienced and inexperienced, need to fly in order to
    meet the Air Force's MC goals in fiscal year 2003?
        General Wald. The Air Force fiscal year 2003 flying hour submission
    for combat coded training hours includes the appropriate hours per crew
    per month required to train line pilots to the level that will meet Air
    Force combat mission ready goals and fully support the warfighting
    CINCs.

                            AIRCRAFT CANNIBALIZATION

        14. Senator Akaka. General Wald, Admiral Blair recently testified
    before this committee about the continuing challenges facing aircraft,
    in particular in Pacific Command. He specifically cited shortages in
    repair parts and stated that 80 percent of Pacific Air Forces' aircraft
    did not meet standards for cannibalization rates in 2001. Do you share
    Admiral Blair's concerns? Does the fiscal year 2003 budget take steps
    that will improve this situation, or is something more required to
    increase our air readiness?
        General Wald. Analysis reveals Pacific Air Force (PACAF) aircraft
    indeed have cannibalization rates higher than the Air Force average.
    However, in all but one weapons system (F-15E) there were reductions in
    the fiscal year 2002 cannibalization rate for Pacific Air Force
    aircraft. The improvements in PACAF cannibalization rates follow a
    similar trend in Air Force aggregate cannibalization and supply rates.
    The Air Force aggregate cannibalization rate reached its zenith in 1997
    at 12.7 cannibalizations per 100 sorties and has consistently improved
    to 10.1 cannibalizations per 100 sorties in 2002--a 20 percent
    reduction in cannibalizations. Likewise, the Air Force supply metric,
    Total Not Mission Capable for Supply (TNMCS), has improved from a 14.3
    percent high in 2000 to 11.8 percent in 2002. It is important to
    emphasize that there are other factors in addition to spares
    availability that influence cannibalization rates. Ultimately,
    cannibalization actions are just the symptoms of much larger concerns
    such as aging aircraft, spares shortages, system reliability
    shortfalls, and retaining experienced mechanics. Consequently, the Air
    Force has implemented a multi-faceted strategy of increased spares
    funding, policy, and organizational initiatives, which continue to
    reduce cannibalizations:

             Beginning in fiscal year 2000, depot reparable spare
            parts funding at 100 percent of the known requirement;
             Increased Direct Support Objective (DSO) authorization
            levels in Readiness Spares Packages (RSP) to a surge of 83
            percent for deployed fighter units;
             Implemented the Air Expeditionary Force (AEF),
            providing stability and planning to units preparing to deploy;
            and
             Created theater Regional Supply Squadrons to track
            assets further reducing cannibalization actions.

        All indications are that the Pacific Air Forces will continue to
    follow the positive Air Force aggregate trend in cannibalization and
    supply rates, further extending their positive fiscal year
    cannibalization trend.

                                  ENCROACHMENT

        15. Senator Akaka. Dr. Mayberry, you noted in your testimony on
    March 14, 2002, before the House Armed Services' Military Readiness
    Subcommittee that finding work-arounds to encroachment challenges
    drains dollars from operations and maintenance accounts, further
    degrading readiness. Please provide the Department's best estimate of
    how much money has been directed in those accounts (by service and
    agency) to pay for training work-arounds. Please further delineate
    these expenses by the causes of encroachment for which they were
    compensating, e.g., environmental, noise, airspace, spectrum, etc.
        Dr. Mayberry. As I have testified in other hearings on the subject
    of encroachment, work-arounds associated with encroachment are a
    serious issue for the Department, but the costs involved are not well
    understood. The services have been able to identify costs incurred to
    modify training in certain specific instances. For example,
    restrictions on the use of Vieques for training Naval Gunfire Spot
    Teams create a need to send 3-man teams to Norway to accomplish this
    same training, costing over $36,000 per team trip. On a larger scale,
    prior to 1991, II MEF stationed at Camp Lejeune, North Carolina, spent
    approximately $1.2 million annually to transport tank and Light Armored
    Reconnaissance units to Fort Pickett, Virginia and Fort Knox, Kentucky
    for live training unavailable at Camp Lejeune. However, the costs for
    such examples are not readily obtained, and DOD does not presently have
    a good tracking and reporting system for aggregating encroachment
    problems and impacts and isolating their costs. As you observe, work-
    around costs are typically covered within an installation's or
    service's overall operations and maintenance accounts, making them very
    difficult to track or delineate. DOD understands the importance of
    better work-around cost estimation, and we plan to address this
    deficiency as part of our ongoing range sustainment initiative.

        16. Senator Akaka. General Bedard, General Wald, and Admiral Krol,
    there has been a long-standing concern that readiness levels do not
    have a very direct relationship to budget requests. The Army has the
    most straightforward justification, with a training strategy tied to
    tank miles driven and flying hours per crew per month. What are other
    services doing to improve visibility into the relationship between
    readiness and funding?
        General Bedard. Field commanders cost out their training
    requirements, submit these costs to Headquarters, Marine Corps for
    submission via the Program Objective Memorandum (POM)  process.
    Training programs are executed according to approved operating budgets.
    While specific non-monetary training metrics have yet to be developed,
    we extensively scrutinize all USMC requirements based on cost benefit
    using a committee-based process of subject matter experts from
    throughout the USMC. The Marine Corps is exploring different means of
    connecting funding and readiness. We are looking into development of
    various types of metrics that can be used in both the readiness
    reporting process and in the budgeting process.
        General Wald. The Air Force's readiness levels do, in fact, have a
    direct relationship to our budget requests. Our readiness picture is
    much more complex than focusing on one or two service metrics to
    reverse downward readiness trends of the 1990s. Some examples of
    metric-type indicators used to measure our readiness are aircraft
    mission capability rates, recruiting, and retention rates of our
    military and civilian workforce, and a facility investment metric for
    our infrastructure. These and other metrics provide the Air Force
    senior leadership tools that influence the decision process during
    programming and budgeting cycles. For instance, we budget for spares,
    supplies, and fuel to support a requirements-based flying hour program
    for aircrew training, which ultimately translates to readiness.
    Likewise, the investment in spare parts during the past 3-4 years has
    paid off through higher aircraft mission capability rates. Our budgets
    also factor quality of training into readiness requirements. As an
    example, aircrews derive the greatest training benefit from sorties/
    events that encompass the right mix of day/night, variable terrain,
    electronic warfare, etc. We continuously evaluate and adjust our
    resources to meet Air Force readiness requirements.
        Admiral Krol. The Navy Flying Hour Program is also directly linked
    to readiness levels. The flying hour requirements are derived from the
    training requirement in hours per crew per month over the course of the
    Inter-Deployment Training Cycle (IDTC). This training matrix is used to
    evaluate the training rating that is reported in the Status of
    Resources and Training System (SORTS). Training, along with equipment,
    supply, and manpower, are the elements that drive our overall SORTS
    rating. Over the course of the past few years, Navy and Congress have
    placed more money in this O&MN account, and between fiscal year 2000
    and fiscal year 2001, our average overall SORTS rating improved by
    approximately 8 percent across the IDTC. The ships and submarine
    operations account requirement is under review to establish a similar
    linkage between the training and operational steaming requirement and
    the subsequent SORTS ratings achieved by those units.

                   IMPACT OF CURRENT OPERATIONS ON EQUIPMENT

        17. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, one of the longer-term impacts of Operation Enduring
    Freedom and Operation Noble Eagle is increased wear and tear on
    equipment. In your opinion, do your fiscal year 2003 budget requests
    take these effects, including equipment reaching the end of its service
    life earlier than anticipated and higher than usual maintenance needs,
    into account in ways that will not harm the readiness of our forces?
        General McKiernan. The Department of Defense has budgeted Defense
    Emergency Response Funding (DERF) as supplemental funding for fiscal
    year 2003 in support of the global war on terrorism. The Army is
    pursuing this source of additional funding for the war's incremental
    costs beyond our 2003 budget. DERF funds are designed to cover
    incremental repair and maintenance costs, and costs for replacement of
    crash or battle damaged equipment resulting from increased operating
    tempo. As the war continues, we will continue to identify incremental
    repair and maintenance costs as well as additional equipment costs to
    the Office of the Secretary of Defense for DERF reimbursement. Should
    DERF reimbursement not be available in the fiscal year 2003 defense
    appropriation, we will request supplemental funding to ensure the
    continued readiness of our forces.
        General Bedard Fiscal year 2003 budget requests do not currently
    account for all the increased wear and tear of equipment reaching the
    end of its service life earlier than anticipated and/or due to higher
    than usual maintenance needs resulting from OEF/NE. Additional funding
    may be required and, if needed, will be identified via our resource
    requirement processes to ensure maintainability of older equipment
    until new replacements are online and fully integrated into the supply
    pipeline. The foremost problem impacting Marine Corps aging ground
    equipment in theater has been the harsh environment. Sand, dust, and
    wind along with the cold weather conditions have caused scheduled
    preventive maintenance to be expedited. Rolling stock, such as the
    HMMWVs, have suffered more mechanical failures than expected. Fuel
    system problems have also been experienced. However, due to experience
    and service interoperability, Marine Corps maintenance personnel at
    Forward Operating Base Rhino were able to overcome equipment failures
    and even assisted the Navy with their mechanical problems.
    Survivability of equipment in harsh environments continues to be a
    major area of concern when conducting operations. Additional analysis
    is required on equipment as it returns, since operations are ongoing.
        General Wald.  Yes, flying hour spares requirements received
    substantial funding for fiscal year 2003, including approximately $380
    million to address spare parts issues associated with aging aircraft
    support. In the event that required maintenance is not funded we will
    be forced to resort to extraordinary measures to be borne by the
    maintainers in order to keep the system in operation. Cannibalization
    rates will increase. Delayed entrance into Program Depot Maintenance
    (PDM) has the added negative effect of driving significant inspections
    and maintenance in the field. The Special Inspections designed to keep
    aircraft airworthy beyond their scheduled PDM input dates serve only to
    provide temporary relief from a grounding condition. These inspections
    increase in complexity and become significantly more labor-intensive,
    ultimately resulting in the weapon system being grounded. When the
    aircraft do come into PDM the cost will be higher and the flow time
    longer. Operating systems beyond their planned service interval have
    the added risk and potential to increase the failure rates which may
    result in Emergency Action Time Compliance Technical Order Inspections/
    repairs. Ultimately we will keep the equipment operating, but it will
    come at the expense of the men and women who must accomplish this
    additional work with fewer resources. This in turn will also have a
    negative impact on our ability to retain skilled technicians.
        Admiral Krol. The Navy's fiscal year 2003 budget does not take into
    account the wear and tear on equipment (i.e., reconstitution costs)
    that has occurred because of Operation Enduring Freedom (OEF) and
    Operation Noble Eagle (ONE) contingency operations. The fiscal year
    2002 executable equipment reconstitution costs for aircraft, ships,
    deployed expeditionary medical facilities, and mobile construction
    battalions deployed in support of ONE and OEF are included in the
    Department's fiscal year 2002 Supplemental request. The OSD-submitted
    fiscal year 2003 DERF Budget includes $10 billion in additional funding
    for ONE/OEF operations without specific definition of costs to be
    covered. The intention is for this funding to be executed as a transfer
    fund based on actual service execution costs. The level of operations
    in fiscal year 2003 has not yet been conveyed to the services, so
    projecting reconstitution costs using forecasting methods is
    inappropriate. However, the Department intends to seek reconstitution
    cost reimbursement from this $10 billion transfer fund as these costs
    are incurred or expected.

                         COST OF CONTINGENCY OPERATIONS

        18. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, please provide the amount in the fiscal year 2003
    budget request for contingency operations (e.g., Bosnia, Kosovo,
    Northern Watch, etc)
        General McKiernan. The Army budgeted $574 million for Bosnia, $919
    million for Kosovo, and $279 million for Desert Spring in the fiscal
    year 2003 budget request.
        General Bedard.

                                                [In millions of dolloars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                              Military
                     Operation                             Location               Total      Personnel       O&M
    ----------------------------------------------------------------------------------------------------------------
    Joint Forge...............................  Bosnia.......................         $1.6          $.4         $1.2
    Joint Guardian............................  Kosovo.......................          4.7          3.4         11.3
    Northern Watch............................  SW Asia......................          0.5          0.2          0.3
    Southern Watch............................  SW Asia......................          0.8          0.2          0.6
    ----------------------------------------------------------------------------------------------------------------

        General Wald. The fiscal year 2003 budget requests the following
    amounts to execute Air Force contingency operations:

                            [In thousands of dollars]
    ------------------------------------------------------------------------
                                   Military Personnel            O&M
    ------------------------------------------------------------------------
    Bosnia......................              $ 32,999              $120,537
    Kosovo......................                 1,782                53,491
    Northern Watch..............                26,700               122,474
    Southern Watch..............                95,042               582,734
                                 -------------------------------------------
      Total.....................               156,523               879,236
    ------------------------------------------------------------------------

        Admiral Krol. The funding in the Navy's budget request for
    contingency operations in fiscal year 2003 is as follows:

    Bosnia
        Joint Forge--$12.3 million
        Deliberate Forge--$20.6 million

    Kosovo
        Joint Guardian--$13.3 million

    Southwest Asia
        Northern Watch--$21.9 million
        Southern Watch--$248.3 million

                                ARMY AMMUNITION

        19. Senator Akaka. General McKiernan, a recent study by the
    Association of the United States Army stated that the Army has
    projected an $820 million shortfall in funding for training ammunition
    over the next 5 years. Is this report accurate? If not, what is the
    current shortfall, if any, in training munitions? If so, what are the
    readiness implications of this shortfall, and what actions does the
    Army expect to take to correct it?
        General McKiernan. The Association of the United States Army study
    was accurate at the time the information was gathered for publication.
    The Army has placed additional funds into the training account and the
    fiscal year 2003 Defense Emergency Response request contains $27
    million for the Army. Additionally, sufficient funds have been
    programmed through fiscal year 2007 to eliminate the projected
    shortfall over the next 5 years. In the light of recent events, new
    training strategies are being developed and staffed. These new training
    strategies are producing new requirements that will be addressed in the
    fiscal year 2004 budget. The Army continues to place the highest
    priority on training ammunition and will make the maximum effort to
    fully resource these requirements. However, current world events may
    unexpectedly deplete stocks and training funding requirements can
    increase.

                            105MM AMMUNITION FOR MGS

        20. Senator Akaka. General McKiernan, does the Army currently have
    sufficient stocks, or have resources planned to acquire sufficient
    stocks, of 105mm tank ammunition in order to supply the Interim Brigade
    Combat Teams' Mobile Gun System when it comes on line in 2004? If not,
    what actions are planned to make up for any shortfalls?
        General McKiernan. The U.S. Army currently has sufficient stocks in
    four of seven required Mobile Gun System (MGS) ammunition cartridges.
    We are in the process of procuring three cartridge types by 2004 to
    meet MGS requirements. First, we are re-procuring high explosive and
    companion training cartridges (M393A3 and M467A1) to meet the MGS's Key
    Performance Parameter. The new service cartridge will replace the aging
    M393A2 High Explosive Plastic cartridge. Second, we will develop and
    procure the M1040 Canister cartridge to meet the Mobile Gun System's
    anti-personnel requirement. The U.S. Army has sufficient stocks of M900
    Armor-Piercing, Fin-Stabilized, Discarding Sabot anti-tank cartridges,
    and m456a2 high explosive anti-tank cartridges to meet mobile gun
    System self-defense requirements, along with appropriate training
    ammunition (M724A 1 and M490A 1).

                               AIRLIFT SHORTFALLS

        21. Senator Akaka. General Newbold, in his testimony earlier this
    month, Admiral Blair stated that Pacific Command forces ``are beginning
    to face regular shortages of airlift and aerial tankage,'' and that
    these shortages are both increasing costs as they contract for civilian
    airlift and complicating training efforts. Are other commands
    experiencing similar shortfalls?
        General Newbold. PACOM, like the other commands, is experiencing
    reduced levels of organic air-refueling and airlift support for those
    requirements not directly supporting the GWOT. The JCS priority system
    is used to adjudicate who gets organic support when requirements exceed
    capacity. (GWOT air-refueling and airlift requirements are currently
    validated at JCS priority one.) In an attempt to support worldwide air-
    refueling requirements, air mobility command (AMC) has nearly tripled
    daily tanker aircraft/aircrew taskings. Commercial passenger and cargo
    aircraft are used to supplement the organic fleet when loads are
    compatible. For this reason, the use of commercial aircraft more than
    doubled during the first quarter of current year 2002.

        22. Senator Akaka. General Newbold, can you provide the additional
    costs that our regional commands are incurring because of airlift
    shortages?
        General Newbold The significant commitment of military aircraft in
    support of the ongoing contingency means that they are not available to
    fly all support, exercise, and training missions. When military
    aircraft are not available, support flights and exercise missions are
    being flown using commercial aircraft. The channel customer is not
    affected by the change in aircraft type. The support flights customer
    pays for the person or cargo being moved, regardless of the type of
    airlift provided. The exercise customer, however, pays for airlift by
    flying hours used to support the mission. The only instance that a
    customer would incur increased cost due to commercial augmentation
    (contract for civilian airlift) would be if there was a need to
    contract for more capacity than is required to move the customer's
    requirement. In today's environment, this is sometimes the case as
    additional force protection personnel and equipment are added to the
    planned event. Also, in the case of training, there are training
    missions that cannot be supported and training can be lost.

        23. Senator Akaka. General Newbold, are there mechanisms available
    either to improve airlift management and/or mitigate training impacts
    that we could take right now to reduce the negative short-term effects
    of current operations?
        General Newbold. The very dynamic nature of the war on terrorism
    has placed unanticipated demands on mobility assets. However, AMC has a
    very specific set of procedures by which organic airlift shortfalls are
    identified. This triggers a request to purchase commercial airlift
    augmentation to support warfighting CINCs whose lower priority missions
    would otherwise be nonsupported. Users can/should be advised that
    commercial aircraft will likely be used, and they should plan
    accordingly to minimize impact to their operations. If commercial
    aircraft are filled to capacity, the charges incurred (which are based
    on weight, not aircraft type) would be the same as when organic lift is
    provided. This would eliminate additional expense during this long-term
    shortage of organic lift capacity. If military or commercial air is not
    available, training options available to the user in the short-term
    include reducing the scope of the exercise, using virtual, computer-
    based training, where feasible, or conducting training at locations
    that minimize the need for airlift support. While these are not the
    preferred solutions, they do allow the user to conduct needed training.

                        INTER-DEPLOYMENT TRAINING CYCLE

        24. Senator Akaka. Admiral Krol, if the Navy decides to extend its
    deployments beyond the 6 months that is typical, what impact will this
    have on the maintenance and training that takes place in between
    deployments?
        Admiral Krol. Maintenance impact: In both short-term and long-term,
    the effect of extended deployments on maintenance will be felt mostly
    on the ship's hull, mechanical, and electrical systems that have a
    historically defined limit of operating hours before requiring an
    overhaul or repair. Many of these systems, like gas turbine and diesel
    engines, high and low pressure air compressors, and pumps of all types
    already display high downtime, and high operating cost trends. These
    systems operate almost continuously when the ship is deployed,
    resulting in predictable wear and tear and eventual failure in
    operation. In the long-term, the maintenance capabilities of the ships
    crew must be upgraded. Navy Afloat Maintenance Training System and the
    Battle Force Intermediate Maintenance Activity (NAMTS/BFIMA) programs
    support this.
        Training impact: The CNO has established two baselines for
    deployment of naval forces. First, prior to deploying again, each unit
    should spend twice the time in a non-deployed status as time deployed.
    This is known as Turnaround Ratio (TAR). Two-to-one is the minimum
    established goal. With adequate TAR, the proper mix of maintenance and
    individual, unit and coordinated training can be achieved. Second, the
    CNO has established the policy that sailors should be in their
    homeports 50 percent of the time over any 3-year period. Adequate TAR
    and underway training supports this personnel tempo goal. Shortened TAR
    can be accommodated over the short-term if required to support
    increased presence; however, maintenance and training will not be at
    the same ideal tempo and will suffer over the long-term. Increased
    deployment length may have no impact on TAR. However, with a given
    (constant) presence or TAR, increasing the deployment length will
    increase the IDTC length, which would be additional IDTC time for
    training and maintenance.

        25. Senator Akaka. Admiral Krol, how much ``flex'' currently exists
    that will allow for additional compression of these already tight
    timelines?
        Admiral Krol. Flexibility remains in the Inter-Deployment Training
    Cycle (IDTC) as timelines become compressed, but it comes at a cost.
    Compressing the IDTC requires reductions in maintenance, and negatively
    impacts training and crew quality of life. Maintenance scheduling is
    frequently the driver in IDTC scheduling. Changing or compressing long-
    lead time maintenance periods increases cost and adversely impacts
    other planned maintenance.
        Compressing schedules also results in reductions in the amount of
    time allotted to training as well as the quality of that training for
    the sailors involved. Shorter training periods force more qualification
    and certification events to occur at an increased pace to insure units
    are ready to deploy.
        The true cost of compressing schedules and reducing maintenance and
    training periods is the negative effect on quality of life and the
    long-term negative effects on ship and aircraft readiness as a result
    of not conducting required maintenance. The Navy is also forced to
    compromise or postpone modernization that is conducted during
    maintenance periods and provides the basis for transformation for the
    force of the 21st century.

        26. Senator Akaka. Admiral Krol, do you have any concerns, in
    either the short- or the longer-term, about the impact of such
    compression on the fleet, both from an equipment and a personnel
    perspective?
        Admiral Krol. Equipment impact: By extending deployments and
    compressing the IDTC, the scheduling of required maintenance becomes
    more compressed. To get the same (or higher) number of manhours
    accomplished in a shorter amount of time, either the maintenance
    infrastructure must grow or the existing infrastructure must work
    longer hours. Either option will add to maintenance costs. Additional
    wear and tear on the ships distributed systems due to lengthened
    operating time will also drive the maintenance requirement up while the
    ship is in port. There are other periodic requirements such as
    preventive maintenance, calibration, inspections, and assessments that
    will either be deferred or waived due to ships operations. Finally,
    ships' modernization must be more strictly controlled, as there is
    minimal time to install and train on new equipment and systems.
    Incomplete upgrades and equipment alterations will be even more
    intolerable with less time to groom between deployments.
        Personnel impact: In the short-term, gains in retention, attrition,
    and recruiting have improved overall fleet sea duty manning from 89.5
    percent some 2 years ago to 97 percent at present. This makes it
    feasible to satisfactorily man our ships and squadrons for deployment
    with only minor personnel actions necessary to replace unplanned losses
    or satisfy other critical skill shortfalls.
        For the long-term, continued commitment to fund quality of life and
    compensation initiatives is essential to offset the negative impact
    higher OPTEMPO/ITEMPO will have upon retention, attrition, and
    recruiting. It is also important that efforts to establish firm
    employment schedules as early as possible. This enables the Navy
    personnel system to conduct advanced planning for timely replacements;
    it also supports the personal planning of our sailors.

                   REGIONALIZATION OF INSTALLATION MANAGEMENT

        27. Senator Akaka. General McKiernan, General Abrams testified
    before the House Armed Services Committee on March 8, 2002, that
    regionalization of installation management will pose challenges for
    U.S. Army Training and Doctrine Command (TRADOC) mission commanders. He
    stated that the loss of flexibility to move funds from base operations
    to more urgent training needs increases the importance of fully funding
    training requirements, beginning in fiscal year 2003. Are TRADOC's
    training needs fully funded in the fiscal year 2003 budget request?
    What is your assessment of the impact of this regionalization on
    training and readiness, not just in TRADOC but for all of the Army's
    warfighting units?
        General McKiernan. TRADOCs current training needs are adequately
    funded in the fiscal year 2003 budget request, with acceptable risk. We
    support base operations regionalization, now termed Transformation of
    Installations Management (TIM), as a means to improve standard base
    operations services across all Army installations, and thus improve
    quality of life for soldiers and their families. Although we have
    concerns, it is difficult to fully assess training and readiness
    impacts before implementation. The Army is committed to ensuring that
    certain mission activities, i.e., training enablers, force protection,
    and airfield operations, are fully supported under the TIM
    organization. These include our range and training land operations and
    modernization programs, and our battle simulation centers, which
    directly support training and operational tempo. My office is currently
    developing an Organization and Operations Plan for those programs for
    which I am the functional proponent, which will lay out how these
    programs will be executed. We will work closely with the Assistant
    Chief of Staff for Installation Management to ensure that mission
    commanders are directly involved in the prioritization, implementation,
    and control of these functions at all levels.

            IMPACT OF CURRENT OPERATIONS ON PILOT EXPERIENCE LEVELS

        28. Senator Akaka. General Wald, General Johnston testified before
    the House Armed Services Committee on March 8, 2002, that Operation
    Noble Eagle will have the same long-term effect on pilot experience
    that operations in Southwest Asia have had. Specifically, he stated
    that ``flying time'' instead of ``range time'' has reduced the amount
    of time available for realistic training and that, as a result, pilot
    experience has been degrading over the 1990s. Is the Air Force
    examining or planning any efforts to try to remediate these effects and
    if so, what are the likely costs of any alternatives that are being
    considered?
        General Wald. The Air Force is aggressively examining ways to use
    the Air Expeditionary Force (AEF) construct, DOD-directed training
    transformation, and the accompanying budgeting process to mitigate the
    effect of high OPTEMPO on readiness. In the fiscal year 2003 budget and
    beyond, a balanced and integrated approach that focuses on four
    fundamentals--transformation, readiness, retention, and re-
    capitalization--is key to the Air Force maintaining a quality aircrew
    force whose size and readiness enable it to accomplish the mission
    today and tomorrow. An increased training bill in the form of training
    backlogs coupled with the need to maintain an aging fleet of aircraft
    is inevitable but is difficult to quantify until OPTEMPO reduces and
    total training shortfalls are reported. Sufficient and sustained
    congressional support would facilitate the essential readiness and
    other improvements the Air Force needs to continue to train quality
    combat pilots, and remain the world's preeminent air and space force.

                          INCREASED MAINTENANCE COSTS

        29. Senator Akaka. General Wald, your written testimony states that
    your aging aircraft fleet is becoming more expensive to maintain.
    Please provide any data you may have to illuminate trends in cost
    increases, by airframe and model.
        General Wald. The Air Force Total Ownership Cost (AFlOC) database
    with its integral On-Line Analysis Processing (OLAP) tool illustrates
    trends in USAF aircraft maintenance from fiscal year 1996-2001. The
    OLAP tool captures the gamut of aircraft maintenance cost elements,
    i.e., maintenance personnel (organizational, intermediate, and
    ordnance); consumable supplies; depot level repairables; intermediate
    maintenance; depot maintenance; contractor logistics support; and other
    maintenance. The following weapon systems are principal cost drivers:

                    IMPACT OF CURRENT OPERATIONS ON TRAINING

        30. Senator Akaka. General Wald, your testimony describes decreased
    training opportunities as a result of current operations, especially
    for crews of low density/high demand aircraft. What solutions is the
    Air Force exploring for this problem, which you note could have a
    ``serious impact on long-term readiness?''
        General Wald. Currently, decreased training opportunities for
    highly-utilized major weapon systems have resulted in a shift toward a
    back-to-basics approach to ensure aircrews continue to receive the most
    essential training. The Air Force has also ``fenced'' aircraft into the
    training role to make them more available and rotated crews to maintain
    proficiency. In the future, when training is impacted by limited
    aircraft availability, distributed mission training simulator
    technology promises to be a means to enhance readiness by simulating
    large force employment via multiple simulator data-links.

                   IMPACT OF CURRENT OPERATIONS ON RETENTION

        31. Senator Akaka. General Wald, you state in your testimony that
    the implementation of stop loss policies and higher tempo associated
    with Operations Noble Eagle and Enduring Freedom may negatively affect
    retention, and that ``offsets are . . . being explored.'' What are
    those offsets, and what factors are being used to evaluate options?
        General Wald. We are still in the exploration stage as we look at
    ways to reshape our force based on the new steady state requirements of
    OEF/ONE. This will maximize the effective use of our limited military
    resources and should free up military endstrength to crosstrain into
    our stressed career fields (e.g. Security Forces, OSI, etc.) to
    increase their manning and capability, thereby positively affecting
    retention.

                              ARMY OPTEMPO FUNDING

        32. Senator Akaka. General McKiernan, the Army's training strategy
    for fiscal year 2003 is based on 901 live, virtual, and combat training
    center tank miles, and 14.5 flying hours per crew per month for
    aircraft. Yet the fiscal year 2003 budget request does not fully
    support this strategy. At the same time, the Chief of Staff of the Army
    has directed units to fully execute the strategy, irrespective of
    funding shortfalls. Where does the Army plan to obtain additional
    resources to fully execute the training strategy? What do you think the
    impact will be if additional training funds are not made available in
    2003 and training is reduced?
        General McKiernan. Yes, the Chief of Staff, Army has directed
    commanders to execute the full training strategy. The funding reduction
    was a disappointment. The Army's fiscal year 2003 requirement, as
    submitted, included 754 ``live'' miles, 46 ``virtual'' miles (800 mile
    total), and 103 ``National Training Center'' miles for a total tank
    mile requirement of 903. The funding reduction was based upon
    historical execution. The Army believes it was not given sufficient
    credit for instituting effective management controls in fiscal year
    2001 that restricted migration from OPTEMPO or for executing the
    highest level of tank miles since Operation Desert Storm. These same
    controls are in effect for fiscal year 2002 and will be continued into
    fiscal year 2003.
        Since our training strategy and guidance to the field has not
    changed, the challenge is to identify sources of funding that will
    enable us to execute that strategy. We are currently working with
    departmental leadership to restore critical training funding. Should
    the funding not be restored, we will closely scrutinize year of
    execution obligation rates for our Major Commands and make program
    adjustments as required. Training is critical for Army readiness. We
    are committed to providing the resources required to meet our strategy
    and the associated level of readiness.

                               HIGH SPEED VESSEL

        33. Senator Akaka. General McKiernan, the Army has solicited a
    second high-speed catamaran, reportedly to support Operation Enduring
    Freedom. Marine Corps forces on Okinawa are currently leasing a similar
    vessel but have decided to use it only for training purposes, because
    it lacks force protection. Is it the Army's intent to use this vessel
    in current operations? If so, what steps will be taken to protect it,
    the troops, and equipment that might be embarked? What are the expected
    costs of this protection, and how confident are you that the security
    will be adequate?
        General McKiernan. The Army published an intent to solicit a second
    high-speed catamaran. However, this requirement is currently under
    review by Central Command (CENTCOM). The high-speed catamaran, also
    known as the High Speed Vessel (HSV) HSV-X1, ``Joint Venture,'' is
    under a joint Army and Navy lease and will deploy to the CENTCOM area
    of operations to provide a high-speed shallow draft vessel capability
    in support of Operation Enduring Freedom.
        To ensure the protection of the vessel, troops, and equipment, the
    HSV-X1 will have individual and crew served weapons on-board. The
    weapons package reflects the normal weapons found on the U.S. Army's
    Logistics Support Vessels, which are currently deployed in the CENTCOM
    area of operations. The crew will also train on force protection battle
    drills while in theater, maintain a 24-hour vessel watch and maintain
    communications with the port facility. The port facility is fenced, and
    has entry control points and host nation speed boats with small arms
    weapons. Navy vessels under Naval Central Command will provide
    additional levels of area force protection support to the HSV-X1 within
    the area of operations. The costs associated with these force
    protection measures do not exceed the normal daily operating costs of
    the vessel because of the requisitioning offset of the individual and
    crew-served weapons laterally transferred from units currently
    inactivating. The Army is confident that these force protection
    measures are adequate to protect the HSV-X1.

                                JOINT READINESS

        34. Senator Akaka. General Newbold, Dr. Mayberry testified that one
    of the clear lessons from Afghanistan ``is that we must fight joint.''
    How well does our current readiness system capture units' readiness for
    joint operations? Are there any efforts ongoing or under consideration
    to improve visibility into joint capabilities?
        General Newbold. Our current system does not capture a specific
    unit's readiness for joint operations, it captures combatant commands
    and service readiness to support and conduct the joint fight across
    eight functional areas (personnel, intelligence, surveillance, and
    reconnaissance (ISR), special operations, mobility, logistics, and
    sustainment, infrastructure, C\4\ and joint planning, and training).
    The Chairman's readiness system is built upon two pillars. The first is
    assessing the traditional readiness indicators: personnel, equipment
    availability, supply, and training. The second is assessing the
    combatant commander's ability to integrate and synchronize joint forces
    to accomplish assigned mission. Inherent in that second pillar are
    readiness indicators that shed light on our ability to execute joint
    operations across the eight functional areas. The Chairman's system
    takes these two pillars and massages them together into an overall
    understanding of the Armed Forces' ability to execute the National
    Military Strategy.
        In the future, we are moving to a readiness assessment system that
    will capture specific unit readiness for the joint fight through the
    use of METs. The units will report their readiness to perform its
    mission essential task. Those tasks correspond directly to combatant
    commanders Joint Mission Essential Tasks (JMETs), the tasks that the
    combatant commander must accomplish to be successful in the joint
    fight. These tasks are identified as the result of understanding the
    specific mission a unit is assigned and articulated using the common
    language of the Universal Joint Task List, which is a comprehensive
    listing of joint tasks units may have to perform. Once that system is
    in place, I believe we will be in an even greater position to
    understand the impact of unit level readiness on the readiness of our
    Armed Forces to conduct joint operations.

                          INTERIM BRIGADE COMBAT TEAMS

        35. Senator Akaka. General McKiernan, your prepared statement says
    the Army is looking at basing an Interim Brigade Combat Team (IBCT) in
    Europe. If the IBCT is a central part of the Army's transformation and,
    as you say on page 11 of your statement, ``would have had a significant
    impact on the conduct of the battles fought to date'' in Afghanistan,
    why is the Army merely planning to ``examine'' forward stationing an
    IBCT in Europe? Why isn't forward stationing an IBCT in both the
    European and Pacific theaters a high priority? Wouldn't that get your
    forces to the fight sooner, while requiring less strategic lift?
        General McKiernan. In July 2001, the Army announced the location of
    the six IBCTs. This was based upon operational and strategic
    considerations. These locations balance a need to forward deploy and
    tightly manage a new and dynamic transformation process, provide an
    upgrade to the capabilities of XVIII Airborne Corps, and make the
    appropriate investment in a Reserve component brigade to guarantee the
    successful transformation of the Army Reserve component to the
    Objective Force.
        The Army feels that its current stationing plan, which has a
    Pacific focus but emphasizes global deployability, exploits the
    advantages of forward deployment for the Pacific theater of operations
    while maintaining the Army's flexibility to meet other requirements in
    other critical and non-critical regions.
        Defense planners tasked the Army to plan to station an IBCT in
    Europe by the end of 2007. The Army leadership has presented a plan to
    Office of the Secretary of Defense and is awaiting guidance.

                                   AC/RC MIX

        36. Senator Akaka. General McKiernan, you testified that current
    demands for combat service support (CSS) units are straining the
    Reserve Component. Is the Army evaluating whether some CSS units ought
    to be moved into the active component, and/or whether there are some
    capabilities in the active force that might be moved to the Reserves?
        General McKiernan. Yes. Today's evolving National Military Strategy
    (NMS), the QDR, and other defense plans call for a somewhat different
    force capability than that of the 1990s, which was designed to fight
    and win two major theater wars (MTWs) nearly simultaneously. Under the
    previous strategy the Reserve component (RC) was assigned an increased
    priority for Combat Support (CS) and Combat Service Support (CSS)
    missions.
        The shift in the defense strategy dictates a detailed evaluation of
    the force mix. The Army uses Total Army Analysis, an analytical process
    that guides our force development within the constraints provided in
    the military strategy and budget, to determine new force structure
    requirements. We are completing our latest analysis that includes a
    look at Army force structure requirements based on the new strategic
    guidance. For the most part, the Army has the right composition of
    forces to execute the assigned missions. However, there are a number of
    CS and CSS capabilities that may need to be increased in the Active
    component (AC) to carry out the defense strategy and emerging missions.
    The Army is assisting the Department of Defense to identify a range of
    innovative force capability options to address new challenges and
    opportunities as part of a QDR and other defense plans DPG-directed
    review of the AC/RC mix.

                              PERSONNEL READINESS

        37. Senator Akaka. Admiral Krol, your written statement asserts
    that personnel readiness has improved due to pay raises, increased
    housing allowances, and higher levels of career sea pay. What evidence
    exists to demonstrate the contributions of each of these factors to
    higher personnel readiness levels?
        Admiral Krol. Tables 1 and 2 show how Navy has, since fiscal year
    1999, made impressive gains in both increasing enlisted retention
    (i.e., sailors deciding to remain in the Navy at the end of an
    enlistment) and lowering enlisted attrition (i.e., more sailors are
    successfully completing enlistments), especially among sailors with
    less than 10 years of service.

        While there may be many factors that go into an individual sailor's
    career decision, years of statistical studies have shown conclusively
    that increases in pay have a significant effect on retention. The
    results of improved retention are clearly shown in Table 3--battle
    groups are deploying better manned than ever before, and, in turn, the
    Navy is better able to prosecute the global war on terrorism.

        It is too early to do a complete statistical analysis of the
    retention/attrition impact of the 2002 boosts in pay and compensation
    (i.e., most have only been in effect since January 1, and improvements
    in Career Sea Pay went into effect only within the last 6 months).
    However, we do know that these most recent improvements put substantial
    dollars into sailors' pockets. For example, a Boatswains Mate Third
    Class (E-4) serving in a deployable Norfolk-based ship and drawing
    Basic Allowance for Housing (BAH) will make approximately $11,000 more
    in 2002 than in 2001. The increase takes into consideration hikes in
    basic pay, authorized BAH for qualified E-4 single shipboard sailors,
    and the October 2001 increases in Career Sea Pay. These initiatives
    have been met with overwhelming positive feedback from fleet sailors
    and are making a tangible financial difference for sailors and their
    families. As Gas Turbine Systems Technician (Electrical) First Class
    (E-6) Heink Reisenbichler, a 15-year sailor, put it in a recent media
    interview, ``Our most valuable assets are our people . . . the pay
    itself will motivate people to stay, and especially reduce the
    financial stress for the younger sailor.''
        We are winning the battle for people, but important challenges
    remain. Officer retention in most line communities is below required
    levels and recruiting shortfalls exist in officer specialty areas and
    critical enlisted ratings. This is the first time in history that the
    services have faced a prolonged conflict with an all-volunteer force.
    We must ensure our most valuable resource, Navy men and women, are
    provided with the tools and leadership to succeed, including a
    continued commitment to enhancements in compensation.

                           LENGTH OF WAR ON TERRORISM

        38. Senator Akaka. Admiral Krol, you state that it is ``quite
    probable that the global war on terrorism will continue for several
    years at a pace similar to, and perhaps periodically greater than, that
    required to date for Operation Enduring Freedom.'' On what basis have
    you reached this conclusion? Have you received any guidance about the
    length or level of commitment you should plan for from either your
    civilian or military leadership?
        Admiral Krol. The senior leadership in both the Defense Department
    and White House has publicly stated the global war on terrorism may go
    on for many years. Given the nature of our enemy and the very
    unconventional nature of his tactics, the duration and intensity of the
    global war on terrorism cannot be predicted with certainty. As with
    conflicts in the past, various options are being carefully analyzed for
    the continued prosecution of the global war on terrorism. Different
    options entail different levels of commitment in material, time, and
    manpower.

                           PRIMARY READINESS CONCERNS

        39. Senator Akaka. Dr. Mayberry and General Newbold, what do you
    believe is the most important future readiness challenge that is not
    sufficiently appreciated, either within the DOD or by Congress?
        Dr. Mayberry. One of our most important readiness challenges for
    the future is to preserve and protect our training ranges and major
    training centers. These assets are essential for assuring realistic
    combat training for our military forces. We need to have the means to
    protect these assets from the many forms of encroachment, and modernize
    them to support tomorrow's warfighting needs.
        General Newbold. While there are a number of programs, weapon
    systems and transformational concepts that are vital to the Department
    remaining the predominant military force on Earth, their value will be
    greatly diminished if we do not have the right blend of talent, in the
    right quantities and the right experience levels, to perform our future
    missions.
        Congress and the DOD are both aware of the importance of service
    members, but the importance of the preserving the intangibles of
    military service (camaraderie, cohesion, espirit, etc.) is often given
    insufficient credit. Compensation will never match the demands and
    risks we ask of our military members, so service must be unique and
    transcendent. This comment is not intended to diminish the importance
    of compensation. Compensation is an indication of the appreciation of
    the country to the servicemember's sacrifice and is vitally important
    both for this reason and so that our families basic needs can be met.
    We ask a lot of our soldiers, sailors, airmen, and marines--arduous
    training, sitting long hours on alert, long family separations, often
    in dangerous environments that add to the overall stress to the family.
    The vast majority of our force takes enormous pride in serving their
    country, but they also have to meet their personal obligations. If long
    separations are too frequent, if the pay differential with the
    civilians community becomes too large, if benefits are sensed to be
    eroding, we run the risk of not being able to retain--or recruit--the
    highly intelligent, skilled personnel necessary to operate those new
    weapon systems, concepts, and programs. We've made tremendous progress
    in quality-of-life initiatives recently, but we must be ever mindful of
    the needs--intangible and real--of our soldiers, sailors, airmen, and
    marines.

                                OSD ORGANIZATION

        40. Senator Akaka. Dr. Mayberry, your office is responsible for
    oversight and policy for force readiness. As we have discussed already,
    readiness is a complex equation, with many contributing elements. Key
    among them, however, is logistics support, which falls under a
    different under secretary. Do you feel that the current organization
    and division of responsibilities within the Office of the Secretary of
    Defense adequately support your efforts to coordinate and direct all
    aspects of readiness? If not, what changes have you considered and/or
    proposed?
        Dr. Mayberry. There are always challenges in ensuring adequate
    logistics support for our forces. In fact, this area presented enough
    challenges to warrant the establishment of a Deputy Under Secretary of
    Defense for Logistics and Materiel Readiness [DUSD(L&MR)]. I have met
    regularly with the DUSD(L&MR), and our staffs work closely to ensure
    the most important materiel readiness issues are addressed. I have no
    concerns with the current organization.

                                FORCE PROTECTION

        41. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, could you please quantify the additional force
    protection requirements after September 11? What options, if any, are
    you considering to alleviate the burden that meeting this requirement
    might pose?
        General McKiernan. Since September 11, the Army has mobilized
    15,668 Reserve component (RC) soldiers and detailed a further 12,478
    Active component (AC) soldiers to perform installation security duty
    requirements that are mandated by the Department of Defense (DOD) Force
    Protection Condition (FPCON) System. The majority of these soldiers are
    utilized to perform installation access control, security patrols, and
    the guarding of mission essential vulnerable areas.
        The Army is pursuing several initiatives to alleviate this burden
    upon our AC/RC soldiers. We are reducing the number of access control
    points necessary to provide the best force protection possible while
    minimizing the number of personnel required to perform installation
    access control. The Army is exploring existing and forthcoming security
    technology that would enhance our security capabilities and further
    reduce manpower required to support FPCONs. Additionally, the Army has
    recommended to Congress the modification of existing law to permit
    commanders to contract for security guards to perform the force
    protection duties currently being done by AC/RC soldiers.
        General Bedard. While force protection (FP) is not the mission of
    the Marine Corps, it is mission-essential. Our highest priority remains
    unchanged: the protection of our marines, those serving with us, their
    families, and our civilian marines. Our most advanced aircraft, ship,
    or weapons system is of no value without highly-motivated and well-
    trained people. People and leadership remain the real foundations of
    the Corps' capabilities. Since September 11, force protection
    requirements (both new and previously identified) have been addressed
    in the enhancement of our organizational structure and anti-terrorism
    capabilities.
        A leading example of this enhancement is the creation of the 4th
    Marine Expeditionary Brigade (Anti-Terrorism). The 4th MEB (AT)
    combines our Marine Security Guard Battalion, Marine Security Force
    Battalion (MCSF BN), and the Chemical Biological Incident Response
    Force (CBIRF) with a specialized anti-terrorism infantry battalion, as
    well as a command element complete with dedicated planners,
    coordinators, and liaison officers for anti-terrorism operations. The
    4th MEB (AT) has had an immediate impact, deploying marines within 60
    days to our re-opened embassy in Kabul, supporting flight line security
    in Incirlik, Turkey, as well as supporting anthrax identification at
    the Capitol.
        The fiscal year 2003 budget reflects an endstrength increase of
    approximately 2,400 marines in support of the 4th MEB(AT). This
    increase will enable the Marine Corps to maintain the operational and
    unit integrity of our 24 active infantry battalions, and regimental
    command elements. Additionally, an endstrength increase would provide
    structure and resources to form the 3rd Fleet Anti-terrorism Security
    Team (FAST) Company, thereby increasing our FAST capability from 13 to
    20 platoons. This valuable asset is operationally controlled by the
    Chief of Naval Operations and strengthens the Navy-Marine Corps Team.
        Electronic Security Systems (ESS) are the technology centerpiece of
    the Marine Corps AT/FP program. ESS core funding supports physical
    security efforts to trade technology for manpower. Installation and
    operating forces commanders have identified requirements for increased
    ESS support for AT/FP, which includes increased surveillance capability
    (closed-circut TV) and digital capture technology for access control
    points; portable sensor technologies; access control capability; and
    biometrics integration.
        Our centrally managed Physical Security Upgrade program relieves
    commanders of having to choose between physical security projects that
    support AT/FP efforts and quality of life minor construction and repair
    projects at the installation level. This program provides funding for
    blast mitigation; emergency power generation; security force facilities
    improvement; security lighting; ordnance facilities improvement;
    emergency operation center upgrades; and installation perimeter
    fencing. In addition to the above core requirements, we received
    supplemental funding via PBD 810 and the Defense Emergency Response
    Fund (DERF) to support Mass Notification/Personnel Alerting Systems,
    communication interoperability with State and local emergency response
    agencies, and emergency preparedness for installation first responders.
        In summary, our anti-terrorism/force protection program is based on
    our ability to leverage our scarce manpower resources with enhanced
    technology and training.
        General Wald. Based upon the increased terrorist threat, we
    immediately implemented a higher FPCON at all our CONUS Active,
    Reserve, and Guard bases. We mobilized Air Force Reserve and Air
    National Guard security forces and implemented stop loss to help
    sustain manning levels. It appears we will be in this situation for the
    long haul as intelligence and law enforcement reports indicate the
    terrorist threat to our operations and people are significant and
    enduring. We continuously evaluate our FPCONs and employ random
    antiterrorism measures to deter and counter the threat. We are
    exploring various ways to improve our force protection capabilities and
    reduce the manpower shortfalls and associated burden on our people.
    These methods include improved technology, training, tactics,
    techniques, and procedures.
        Admiral Krol. September 11 obligated the Navy to undertake force
    protection measures in the United States proper that had previously
    been institutionalized overseas--including robust, post-U.S.S. Cole
    waterside security measures. Given roughly two-thirds of the Navy's
    operating bases are in the U.S., this increase in posture and readiness
    precipitated a proportional increase in necessary security resources,
    particularly manpower.
        Prior to September 11, the Navy was the first service to develop,
    over the course of 4 years, a rigorous, objective staffing process to
    quantify manpower requirements for security forces. With this manpower
    metric, the Navy determined that about 4,500 additional personnel are
    required to support FPCON BRAVO staffing. Until adequate Active Duty
    security manpower becomes available, this additional security staffing
    requirement is being filled by mobilized Reservists, and Active Duty
    personnel whose normal functions do not include force protection. Given
    that FPCON BRAVO is a likely long-term domestic condition, neither
    Reservists nor these temporary augments are viable over time.
        The Navy is considering a number of options to alleviate these
    post-September 11 burdens. We are examining several options for meeting
    the increased personnel requirements: increasing our Active Duty
    numbers devoted to force protection, using a mix of Active Duty and
    civilian personnel, using contract security personnel (though this
    would require a change in public law), or a combination. We are also
    actively examining where technology could be used to reduce the number
    of security positions by creating secure enclaves around piers and
    airfields inside our bases. Solutions, tailored to each unique
    individual facility, are under review.

                          IMPACT ON RESERVE COMPONENTS

        42. Senator Akaka. General McKiernan, General Bedard, General Wald,
    and Admiral Krol, what impact has the call-up of the Reserve components
    for Operations Enduring Freedom and Noble Eagle to perform missions
    such as CAPs, airport security, and force protection at installations
    had on the ability of those Reserve components to conduct their normal
    training? Does your service plan to conduct its normal Reserve
    component training this summer? To date, has the current call-up had
    any impact on Reserve component recruiting or retention?
        General McKiernan. The call-up of the Reserve components to conduct
    airport security and force protection missions in support of Operations
    Enduring Freedom and Noble Eagle has not impacted on their ability to
    conduct scheduled training. Reserve component units that have not
    deployed will conduct their normal annual training as scheduled.
        Today, over 54 percent of the Army resides in the Reserve
    component, a significant portion of which has been mobilized to fight
    against terrorism. Over the course of the global war on terrorism, the
    Army has mobilized over 30,000 soldiers to either support individual
    states in a Title 32 or state Active Duty role or to provide Title 10
    support to the Federal Government. The challenge now facing the Army is
    to sustain this mobilization over time, as the majority of requirements
    will continue with only a portion of those being feasible to transition
    to civilian or contract support.
        In addition to doubling the number of soldiers deployed since
    fiscal year 2001, the Army has been particularly stressed in specific
    high-demand/low-density Military Occupational Specialties (MOSs) such
    as military police, military intelligence, special operations forces,
    and chemical personnel as well as specific unit capabilities that
    primarily reside in the Reserve component. Currently, almost 80 percent
    of the Army's military police force deployed around the world in places
    like Afghanistan and Guantanamo Bay, Cuba and in numerous locations
    throughout the United States is coming from the Army National Guard
    (43.4 percent) and the Army Reserve (36.2 percent). Similarly, the Army
    has mobilized 62 percent of its Reserve component military intelligence
    capability and has sought out linguists and soldiers with human
    intelligence (HUMINT) expertise. At the unit level, the Army has
    mobilized a significant logistics capability, over 70 percent of which
    resides in the Reserve component, as well as half of its existing
    Biological Detection System (BIDS) units.
        To deal with the stress on high-demand/low-density personnel and
    the shortage of specific unit capabilities, the Army enacted selective
    stop loss to hold certain soldiers with selected skill sets on Active
    Duty. The Army was also forced to mobilize large number of Reserve
    component units and individuals. While the Office of the Chief of Army
    Reserve reports that these actions have not had a negative impact on
    recruiting or retention, it is important to note that stop loss and
    mobilization may mask underlying issues in these areas. Moreover, it
    may simply be too early to tell.
        While the Army is fighting the current war on terrorism, it is also
    developing plans to mitigate the shortage of specific personnel and
    unit capabilities in the future. The Army is reexamining its Active and
    Reserve component mix of forces, conducting a review of its overall
    force structure through the Total Army Analysis process, and revisiting
    its endstrength requirements.
        The global war on terrorism, in potential scope and duration, is
    unlike any previous American war with the possible exception of the
    Cold War. During the Cold War, however, the Army had the majority of
    its capability in the Active component. Today, that is not the case.
    Given the ongoing and open-ended requirements of the war on terrorism
    and the limited size of the Active component, the Army will continually
    rely on the Reserve component and may have to revise its strategy for
    recruiting and retention in order to maintain the critical capability
    to fight and win this Nation's current and future wars.
        General Bedard There have been no impacts on units and individuals
    not activated. Activated units have been provided with greatly enhanced
    training opportunities. For example, one of the first unit activations
    sent two platoons from B Company, 1st Battalion, 23rd Marines to Naval
    Base Guantanamo Bay, Cuba to assume the installation security mission.
    To prepare for the mission the unit received extensive training in
    anti-terrorism and force protection from Marine Corps Security Forces
    Battalion. During their 4-month rotation in Cuba, they were also able
    to conduct extensive additional training, including live-fire, not
    normally available to Reserve units due to their limited training
    availability. The remaining two platoons in the company were activated
    in mid-February to provide relief for the same mission. They, too, are
    getting all of the additional training which will benefit not only the
    unit readiness, but the individual marines as well.
        Since their call to Active Duty, 2nd Battalion, 25th Marines and
    Headquarters Company, 25th Marine Regiment have been serving as part of
    2nd Marine Division and participating in all the normal training
    opportunities offered at Camp Lejeune. One recent training opportunity
    gave the Reserve Marines a chance to test and utilize new field
    equipment. The 25th Marine regiment is one of only three regiments in
    the Marine Corps (along with 6th and 8th Marines) to receive and train
    with the new Combat Operations Center Command and Control equipment.
    The opportunity to test new field equipment rarely comes to the reserve
    units.
        Marine Heavy Helicopter Squadron 772 was activated to support 2nd
    Marine Aircraft Wing and is currently at MCAS New River. This CH-53
    squadron will reinforce Marine Medium Helicopter Squadron 263 as part
    of the air combat element for the 24th Marine Expeditionary Unit, which
    deploys this summer. The squadron is undergoing extensive training to
    be designated ``special operations capable,'' a first for a Reserve
    squadron. Across the board, Marine Reserve units activated for the
    global war on terrorism are performing their designated missions and
    gaining superior training, which will enhance the versatility,
    flexibility, and adaptability of the reserves to react, reinforce, and
    augment the Active Forces.
        The Individual Mobilization Augmentees (IMAs) activated thus far
    are working in the pre-designated billets that they normally drill.
    Those IMAs not activated are expected to continue to participate in
    training with their operational sponsors. The Individual Ready Reserve
    (IRR) members who have been activated are either working in their
    Military Occupational Specialties (MOSs), thus maintaining their
    proficiency, or, for those who volunteered to fill a billet outside of
    their MOS, gaining new skills. Those working installation security have
    benefited from additional training in anti-terrorism and force
    protection.
        There have been no significant modifications to the MarForRes
    Training Exercise and Employment Plan, so all previously scheduled
    events will take place. Units not activated will continue to execute
    their training plans as previously scheduled, and units that remain
    activated will not be required to conduct annual training.
        Marine Corps Reserve recruiting and retention behavior thus far in
    fiscal year 2002 is not significantly different than we experienced in
    fiscal year 2001. The complex nature of the current conflict, coupled
    with the resulting unknowns concerning its extent and duration make it
    impossible to predict the long-term impacts on recruiting and
    retention. Long-term impact on recruiting will be tied to the role of
    the particular service involved, public perception, and overall
    progress in achieving the objectives of the conflict. Long-term impact
    on retention will be tied to two critical factors. First, the job
    satisfaction experienced by Reserve members who are mobilized will
    determine the extent of continued interest in maintaining Reserve
    affiliation once these members have met their call up responsibilities.
    The second critical retention factor will be determined by the impact
    of their post-Active Duty transition and assimilation back to their
    local communities. Those members who experience difficulty in family or
    personal life, reemployment and civilian careers, and related economic
    impacts could have a significantly decreased interest in continued
    participation in a Reserve capacity. It is important for leaders and
    policy makers at all levels to watch these areas closely and to
    evaluate any adverse impact experienced by our Reserve members, both
    during Active service and after they have resumed their pre-
    mobilization careers and family life. Because we have not demobilized a
    significant number of marines initially called to Active Duty in
    support of the current mobilization, the overall impact on retention
    for recalled members is undetermined at this point.
        General Wald. AFRC personnel proudly serve in continuing
    deployments in support of our present war on terrorism, and other
    contingency and humanitarian operations. This higher OPTEMPO has
    resulted in less training time in some areas. For example, personnel
    who deploy in support of taskings outside of their units are getting
    valuable operational experience; however, in some cases, they are not
    taking care of some of the recurring training requirements which would
    have been accomplished had they performed home station duty. The full
    scope homeland security associated requirements and mission are still
    evolving and related additional training requirements will be addressed
    concurrently. Air Force Reserve members will be expected to complete
    their statutory annual tour requirements for the fiscal year. However,
    given the current number of mobilized Reservists it's expected that the
    number of personnel available to actually perform annual tours will be
    diminished. In accordance with current policy, Inactive Duty Training
    (IDT) requirements are fulfilled and members are considered
    ``constructively present'' while on Active Duty. The member's commander
    or program manager should determine when IDT/Annual Training (AT) is
    required and may waive training requirements when appropriate.
        Admiral Krol. There has been minimal impact on the training regimen
    to date. Naval Coastal Warfare units are currently serving in both
    CONUS and OCONUS force protection roles, a mission that is closely
    aligned with their war time mission and serves to sharpen unit
    surveillance and water-borne surface ship interception skills.
    Likewise, aviation units are serving in a capacity that ultimately
    improves skills and readiness. Currently plans are being developed to
    address force sustainment, both Reserve and Active capability, to deal
    with long-term force protection needs.
        Additionally, current plans are to continue normal training and to
    meet exercise commitments. All non-mobilized Selected Reservists will
    be eligible to perform annual training.
        Since September 11, the Navy's retention rate has risen
    substantially, resulting in fewer qualified veterans leaving Active
    Duty and therefore available for Reserve affiliation. Of those
    personnel who have made the decision to leave Active service during the
    war, their awareness of Reserve mobilization has impacted their
    decision for Reserve affiliation. The result is that affiliation of
    Navy veterans appears to have decreased to some extent. Retention
    appears to have increased due to stop loss, and the inability of a
    mobilized Reservist to separate. We expect attrition to increase and
    retention to decrease as a result of demobilization. In an attempt to
    fill the gap, Naval Reserve recruiting has significantly increased the
    accessions of non-prior service personnel.
                                     ______

                 Questions submitted by Senator James M. Inhofe

                            TRAINING RANGES--VIEQUES

        43. Senator Inhofe. General Bedard, you note in your written
    testimony on page 22 that ``it is absolutely critical that the Navy and
    Marine Corps maintain areas where they can combine naval gunfire,
    artillery, air, and ground maneuver simultaneously.'' Is Vieques one of
    these areas to which you are referring?
        General Bedard. It is essential for naval forces to have access to
    a live-fire training environment that allows for simultaneous live-fire
    integration of all naval fires, including Marine direct and indirect
    fires (small arms, machine guns, mortars, and artillery), Naval Surface
    Fire Support, and aviation delivered fires. Vieques represents the only
    training location on the east coast that possesses the ability to
    accommodate the full range of naval fires. The loss of Vieques live-
    fire training will degrade the ability to adequately train and prepare
    Marine Air Ground Task Forces on the east coast for combat.

        44. Senator Inhofe. General Bedard, the Army and the Air Force
    indicate that they have unfunded requirements in support of their
    training ranges for fiscal year 2003. The Navy does not identify an
    unfunded requirement for training ranges. Is the Marine Corps fully
    resourced to support training ranges, including Vieques, in fiscal year
    2003?
        General Bedard. Our fiscal year 2003 budget allows us to meet our
    basic requirements in support of training ranges, although a number of
    deficiencies exist which we are trying to address. While our ranges are
    generally in adequate condition, we have been unable to modernize them
    to provide for advanced fire and maneuver. We must compete our training
    range enhancements in the POM process against the same funding lines
    that procure our warfighting systems and equipment and, most
    frequently, this process leaves training range modernization behind. In
    particular, the operation and maintenance (O&M) funding provided for
    range maintenance is subject to prioritization with other projects in
    the same category and frequently falls short when competing with family
    housing maintenance and other base support functions.
        Our most significant limitations and shortfalls are targetry and
    infrastructure to contribute to more advanced training. Realistic
    targets that provide feedback to the shooter, instrumentation that
    tracks positions over time, and threat emitters that stimulate aircrews
    to take appropriate action while flying training missions are examples
    of upgrades that would facilitate more advanced training. Once again,
    these programs have to compete against other critical deficiencies and
    therefore may not receive the necessary funding, or may take much
    longer than desired to field.
        Finally, we cannot comment on the level of fiscal support for
    Vieques, since operations and maintenance funding for these ranges is
    provided by the U.S. Navy, not the Marine Corps.

        45. Senator Inhofe. General McKiernan, General Bedard, General
    Wald, and Admiral Krol, in addition to the well-publicized issues
    surrounding U.S. Navy/Marine Corps use of the Vieques training range,
    the services face growing restrictions on the use of other military
    ranges throughout the United States. It is expected that the problem
    will be magnified by the introduction of faster and more lethal weapon
    systems that require larger air, surface, and subsurface training and
    operating areas. The protection of endangered species on military lands
    has been particularly challenging for the military departments. The DOD
    property supports, on a per capita basis, about four times the number
    of endangered species as the Departments of Agriculture and Interior
    lands. The DOD has about 26 million acres of land and about 300
    endangered species. Most of the acreage is in training areas. Adding to
    the challenge is the success of military environmental stewardship.
    Like most things, when you ask the military to do something, it's going
    to get done and it's going to get done right. In the case of the
    environmental stewardship program, the success of the program has
    resulted in increased encroachment--a Catch-22. Please give examples of
    specific training ranges where encroachment is particularly
    problematic. How much of the training ranges are not usable because of
    environmental or other types of encroachment?
        General McKiernan. In the vast majority of cases, encroachment at
    our training ranges is the sum of incremental restrictions to the way
    the Army would train under unconstrained conditions. There are very few
    incidents of range areas that are entirely unusable due to these
    constraints. Rather, a given area may be subject to a number of
    restrictions on things like the location, duration, and timing of
    training events or the weapons and equipment that can be used in
    training. The cumulative effects of these incremental constraints are
    sometimes subtle but unquestionably result in sub-optimal training
    conditions.
        Examples of installations experiencing encroachment issues include:

        Fort Hood, TX: The U.S. Fish and Wildlife Service's (FWS)
    biological opinion, issued under the ESA for both the Golden Cheeked
    Warbler and the Black Capped Vireo, restricts training on over 66,000
    acres (38 percent) of training land. These restrictions include no
    digging, no tree or brush cutting, and no ``habitat destruction''
    throughout the year on the entire core and non-core area. During March
    through August, vehicle and dismounted maneuver training is restricted
    to established trails, and halts are limited to two hours in designated
    endangered species ``core areas.'' (55,000 acres of the 74,000 acres
    are designated ``core areas.'') Artillery firing, smoke generation, and
    chemical (riot control) grenades are prohibited within 100 meters of
    the boundaries of the designated ``core areas.'' Use of camouflage
    netting and bivouac are prohibited across the entire ``core area''
    during these months. Unit commanders are forced to develop and
    implement work-arounds that result in sub-optimal training conditions.
    An example of such a work-around is the use of tape or ribbons to
    delineate fighting positions in lieu of digging entrenched fighting
    positions. These restrictions primarily affect Fort Hood's eastern
    training/maneuver corridor and concentrate training impacts on the
    western corridor. Concentration of training impacts, coupled with
    cattle grazing, is causing severe erosion and rapid training land
    degradation on the installation.
        Fort Richardson, Alaska: In a lawsuit against the Army at Fort
    Richardson, Alaska, plaintiffs allege that munitions used for their
    intended purpose (fired in training) are solid waste under the Resource
    Conservation and Recovery Act and are subject to corrective action
    (clean-up), a pollutant discharge under the Clean Water Act requiring a
    permit, and a discharge of hazardous substances under the Comprehensive
    Environmental Response, Compensation, and Liability Act (Superfund)
    requiring reporting and remediation. Plaintiffs have filed a motion for
    a preliminary injunction in their complaint seeking to halt live-fire
    training pending resolution of the case. At a minimum, results of this
    litigation will impact Forts Greeley and Wainwright in Alaska because
    they have similar physical conditions and conduct similar military
    range operations. A negative ruling in this case may result in the
    broad application of these statutes to all the military services' live-
    fire training.
        Hawaii (including Makua Military Reservation and Pohakuloa Training
    Area): Training at Makua Military Reservation was halted for nearly 3
    years during negotiations associated with the National Environmental
    Policy Act and endangered species issues. Under terms of a settlement
    agreement, the Army must complete an Environmental Impact Statement
    (EIS) by October 2004. The EIS must address the potential impacts of
    military training at Makua and related environmental studies. Because
    the lawsuit settlement allows less than the required 18 Combined Arms
    Live Fire Exercises (CALFEXs) per year, the 25th Infantry Division
    (Light) [ID(L)] must complete the additional requirements for Company
    CALFEXs during deployments to Continental United States (CONUS)
    training facilities. Also, it is likely that other DOD components
    (i.e., U.S. Marine Corps, Army Reserve, and National Guard) will not
    have access to Makua for live-fire training during the next 3 years,
    since the restrictions of the lawsuit settlement does not allow the
    25th ID (L) to meet its own training requirements without out-of-state
    deployments. Terms of the biological assessment and biological opinion
    for threatened and endangered plants and animals at Makua impose
    restrictions on the uses of training aids, the uses of areas, and the
    intensity of uses. The Army constructed a Multi-Purpose Range Complex
    at Pohakolua Training Area (for nearly $25 million). The Army has never
    fully utilized the range due to very restrictive, and expensive,
    environmental mitigation measures that resulted from consultation with
    U.S. Fish and Wildlife. The U.S. Fish and Wildlife Service is under
    court order to designate critical habitat for 245 plant species in
    Hawaii. These designations are in various stages of completion. Current
    data indicates that 5 critical habitat designations for animals, and 58
    upcoming designations for plants have the potential to negatively
    impact Army training lands and ranges in Hawaii. These adverse impacts
    may include training restrictions, administrative burden, and access
    limitations to certain areas. At Makua Military Reservation, under
    terms of a settlement agreement, the Army must complete an EIS by
    October 2004, or military training may suspended until the EIS is
    complete.
        General Bedard. There are a number of proposals under consideration
    to better identify, quantify, and report the impacts of encroachment at
    both the OSD and Marine Corps level. At the service level, there is a
    USMC proposal to create a range database that would link Individual
    Training Standards (ITSs) and collective training standards to specific
    ranges/range complexes. This metric would enable the USMC to articulate
    the impact of the loss or degradation of a specific range. This metric
    would by extension help identify range shortfalls and provide the
    foundation for a range management roadmap. Ultimately, the range
    management database will lend itself to a much-improved ability to
    articulate encroachment impacts in terms of readiness standards and
    costs.
        The following list is a sample of specific training ranges where
    encroachment is particularly problematic from each coast and Hawaii.
    This list does not include all of our military installations. It is,
    however, representative of the encroachment problems we face and the
    causative factors resulting in training limitations.
        Southern California--Marine Corps Air Station (MCAS) Miramar--
    Endangered Species Act (ESA): Miramar supports nine listed species.
    United States Fish and Wildlife Service (USFWS) proposed designating
    critical habitat for three species covering 65 percent of the base,
    including the containment area. USFWS decided not to designate any
    habitat on the station as the Station's Integrated Natural Resources
    Management Plan (INRMP) provided suitable species management, obviating
    the need for habitat designation. The decision to not designate
    critical habitat on Miramar was challenged by the Natural Resources
    Defense Council (NRDC) and the California Home Builders Association
    (CAHBA). In response to the CAHBA case, USFWS decided to withdraw the
    rule until a new economic analysis could be prepared. It is anticipated
    USFWS will designate habitat such that the concerns of CAHBA are
    accommodated. Finally, it is anticipated that NRDC will refile their
    complaint and seek to overturn the decision that excludes military
    installations from critical habitat designation.
        Air Quality: Miramar is located within the South Coast Air Quality
    District, which is a severe non-attainment area. Meeting air quality
    standards during basing of the MV-22 Osprey, the Marine Corps' number
    one aviation acquisition priority, will be challenging.
        Airspace: The San Diego area airspace is facing encroachment from
    Tijuana, Mexico's Rodriguez airport, affecting operations at all San
    Diego area air stations. In addition, San Diego-area military
    installations face continuing pressure to provide space for a civilian
    international airport to replace Lindbergh Field.
        Marine Corps Base (MCB) Camp Pendleton--ESA: Camp Pendleton
    supports 18 listed species. USFWS proposed designating critical habitat
    for six species covering 57 percent of the base, including all 17 miles
    of beach and a portion of the impact area. USFWS decided to not
    designate much of the base as the harm to readiness would be greater
    than the benefit to the species. Areas designated for critical habitat
    include the area leased to the State of California for use as a state
    park. The decision to not designate critical habitat on Camp Pendleton
    is being challenged in court by NRDC and CAHBA. In response to the
    CAHBA case, USFWS decided to withdraw the rule until a new economic
    analysis could be prepared. It is anticipated USFWS will designate
    habitat such that the concerns of CAHBA are accommodated. Finally, it
    is anticipated that NRDC will refile their complaint and seek to
    overturn the decision that excludes military installations from
    critical habitat designation.
        The State of California is proposing the creation of Marine
    Protected Areas, including one off the coast of Camp Pendleton. The
    Marine Corps objects to this designation as it would restrict the
    ability to conduct amphibious operations.
        Urban Development: Interstate Highway 5 and a parallel railroad
    track serve as barriers for tactical movement from the beach to inland
    fire and maneuver areas. While several underpasses exist, only one
    underpass can accommodate all tactical vehicles used by the Marine
    Corps, thereby limiting manuever throughput. A State park and nuclear
    power plant on the base remove about half of the beach area for
    training. Development up to the fence line is resulting in increased
    local populace noise complaints due to live-fire exercises conducted
    aboard the base. The base has been identified, over the objection of
    the Marine Corps, by the San Diego area governments as a potential site
    for a new international airport. Over the objection of the Marine
    Corps, the USFWS, United States Environmental Protection Agency
    (USEPA), and LA District Army Corps of Engineers (ACOE) are requiring
    the Federal Highway Administration to consider alternative highway
    route alignments through Camp Pendleton.
        Airspace Restrictions: San Onofre nuclear power plant has airspace
    restrictions.
        Air Quality: Camp Pendleton is located within the South Coast Air
    Quality District, which is a severe non-attainment area. Meeting air
    quality standards during basing of the Advanced Amphibious Assault
    Vehicle (AAAV), the Marine Corps' number one ground acquisition
    priority, will be challenging.
        Marine Corps Recruit Depot (MCRD) San Diego--Base Urban
    Encroachment: MCRD San Diego continues to experience significant urban
    development around its facilities with increasing competition for use
    of MCRD property by local airport authorities.
        Arizona--Yuma Training Range Complex (YTRC), Arizona--Chocolate
    Mountains Aerial Gunnery Range--ESA: USFWS designated about 175,000
    acres north of the ridgeline as critical habitat for the Desert
    Tortoise.
        Noise: Target arrays are prohibited from about 200,000 acres south
    of the ridgeline due to noise concerns of Niland, CA, residents. Noise
    and ESA concerns will make creation of new target arrays difficult;
    this adversely affects training for units such as the Naval Special
    Warfare Task Units (SEALs), who require new target arrays.
        Mineral Resources: Oil, mineral, and gas development options on
    Bureau of Land Management (BLM) withdrawn land, if exercised, would
    affect ability of this installation to support military training.
        Western portion of the Barry M. Goldwater Range (BMGR)--ESA: BMGR
    currently provides habitat for two species protected under the
    Endangered Species Act. Specifically, the Sonoran Pronghorn antelope
    which as been designated as endangered and the flat-tailed horned
    lizard which has been proposed to be designated a threatened species.
    The presence of these protected species places significant restrictions
    on approximately 320,000 acres (46 percent) of the BMGR West.
    Similarly, the Sonoran Pronghorn occupies 445,000 acres (42 percent) of
    the BMGR East, which is under U.S. Air Force control but is also used
    by fleet Marine units and Marine Aviation Weapons and Tactics Squadron
    One (MAWTS-1). Although civilian recreational use and the two protected
    species have not prevented required training mission accomplishment,
    they limit use of certain portions of the range. For example, when
    Pronghorn antelope are present in a target area, fighters laden with
    ordnance and fuel must either loiter until the antelope leave or cancel
    the sortie without completing their assigned mission.
        North Carolina--MCAS Cherry Point--Environmental and property issue
    with State of North Carolina over water targets: Concerns include
    unexploded ordnance (UXO), noise, and water quality.
        Frequency spectrum encroachment: The band used for Tactical Air
    Combat Training System (TACTS) range may be lost to commercial
    interests.
        MCB Camp Lejeune--Urbanization: The area around the base is
    experiencing explosive growth due to the nearby beach economy. Planning
    for development of a 2,500-acre parcel adjacent to the base's tank
    range, explosive ordnance disposal range, and rifle range as a golf
    course community supporting 4,500 units of housing is underway. The
    potential for noise complaints is staggering.
        Hawaiian Islands--MCB Hawaii--ESA and Cultural Resources/Makua
    lawsuit: Prior to October 2001, the Army and Marine Corps were enjoined
    from conducting live-fire training exercises in Makua Valley on Oahu.
    The Army has regained limited access to the range for training.
    However, sufficient access to accommodate Marine Corps training was not
    forthcoming.
        Explosive Safety Arcs: Previously compatible land use has been
    converted to commercial development, impeding ability to maintain
    explosive safety arcs.
        General Wald. The Air Force has about 79 endangered species on its
    ranges and installations. Currently, the range most seriously affected
    by restrictions due to endangered species is the Barry M. Goldwater
    Range (BMGR) in Arizona. The BMGR, the adjacent Wildlife Refuge, and
    National Monument are the last remaining habitat for the Sonoran
    Pronghorn antelope. The Air Force routinely redirects or cancels 30
    percent of our live-drop missions every year to avoid the antelope.
    Currently, at the other ranges, there are no major restrictions on
    testing or training. However, we have seen large increases in
    population around several bases that are associated with our largest
    ranges, such as Nellis AFB, Nevada, and Luke AFB, Arizona. It is this
    developing trend that has led the DOD to seek clarification on specific
    legislative and regulatory requirements. Our goal is to maintain our
    capability to test equipment, train military forces, and simultaneously
    protect the environment to the greatest extent possible.
        Admiral Krol. Nowhere is the impact of encroachment more apparent
    than in Southern California and especially with respect to Marine Corps
    bases in that locale. In February 2000, the U.S. Fish and Wildlife
    Service (USFWS) proposed designation of over one-half of the 12,000
    acres that comprise the Marine Corps Air Station, Miramar as critical
    habitat for several species. The designation included runways and other
    aviation related structures. At the same time, USFWS also proposed
    critical habitat designation on about 65 percent of Marine Corps Base,
    Camp Pendleton, an installation of 126,000 acres. At Miramar, the
    Marines were able to convince USFWS that the Integrated Natural
    Resources Management Plan provided sufficient species protections, and
    at Camp Pendleton, USFWS determined that the harm to military readiness
    was greater than the value of critical habitat designation, resulting
    in a scaled back designation. Parties unhappy with these results,
    however, are challenging USFWS's decisions in court. If the challenges
    are successful, critical habitat designation at Miramar will prevent
    the construction and use of ground support facilities, such as a rifle
    range, military family housing, and utility support facilities. The
    Marine Corps will also have to consult with USFWS for the use of
    existing runways and other aviation support facilities. At Camp
    Pendleton, a loss would require the Marine Corps to consult on training
    on 57 percent of the base. The Corps is already modifying training on
    the 10 percent of the base currently designated as critical habitat.
    For example, Marine Expeditionary Unit (MEU) amphibious landing
    exercises are seasonally restricted to only one beach at Camp
    Pendleton. In March 13, 2000, the MEU was restricted to 500 yards out
    of 17 miles of beach because of endangered species and other
    encroachment restrictions. In consequence, instead of accomplishing a
    realistic nighttime amphibious landing, units coming ashore on Landing
    Craft Air Cushion (LCACs) vehicles were off-loaded at the LCAC facility
    before moving inland to continue the exercise. They did not go through
    the full kinds of training required to prepare to take a hostile beach.
    This was a very serious degradation of training.
        About 175,000 acres of the northeastern portion of the Chocolate
    Mountains Aerial Gunnery Range has been designated as critical habitat
    for the desert tortoise. About 300,000 acres of the southwestern
    portion of the range has been designated as a no-drop area due to noise
    concerns. Accordingly, establishment of new target arrays is extremely
    difficult. The Navy SEALs would like to establish a new range, but will
    likely not be able to due to endangered species and noise concerns.
        The Navy was not as successful in avoiding the designation of
    critical habitat on the Naval Amphibious Base (NAB), Coronado, CA. The
    USFWS designated critical habitat for the Pacific population of the
    Western Snowy Plover in December 1999 on portions of the base. NAB
    Coronado has been home to Navy frogmen and SEALs since their inception
    in World War II. All of the basic skills from diving to hydrographic
    reconnaissance have been taught on the beaches and in the bays
    surrounding the base. For decades, SEALs, marines, beachmasters, and
    Amphibious Construction Battalions conducted amphibious landings on
    Coronado's beaches. Ironically, the Navy's successful conservation
    efforts at NAB Coronado have resulted in additional limits on training.
    In the early 1980s, the Navy began moving Eastern Snowy Plover and
    Least Tern nests across the highway to a more protected area in order
    to avoid any damage from tracked vehicles and foot patrols. As the bird
    populations grew in this conservation area, however, the birds extended
    their habitat back to the ocean beaches, forcing the Navy to cease most
    over-the-beach amphibious landings. Since 1996, the Navy has spent
    approximately $675,000 per year on conservation and management programs
    for the birds, increasing nesting by almost 300 percent. Navy's
    successful stewardship program, however, has resulted in the loss of
    training area, and NAB Coronado has lost substantial areas of its
    training beaches to encroachment. The response has been to
    substantially alter training activities or to conduct them elsewhere,
    which disrupts training cycles, reduces access to training areas, and
    increases costs and the already considerable time sailors must spend
    away from their families before leaving for 6-month deployments. The
    Navy has been working currently with the USFWS to alleviate the
    situation but, again, these procedural modifications are open to
    litigation from environmental groups.
        The Navy has run into similar problems on the Vieques Range in
    Puerto Rico. On Vieques, Navy implemented a turtle protection program
    that required daily patrols for endangered sea turtle nests. Under the
    program, where possible, eggs in nests that could be at risk were
    removed to a hatchery. Over 20,000 turtle eggs were saved through this
    program, with a successful hatching rate of 80 percent (far higher than
    turtles in the wild). Notwithstanding the Navy's contribution to sea
    turtle conservation, the incidental take statement in USFWS's
    biological opinion on Navy training at Vieques allowed the Navy to take
    only one turtle in the course of training. This low number of
    authorized take forced the Navy to expend more effort and funding on
    turtle surveys. On average, the Navy spends several days and $100,000
    per battle group training exercise cycle to conduct turtle surveys.
    Additionally, the low number of authorized incidental takes has forced
    the Navy to expend more time on planning training exercises that
    utilizing the beaches. In some instances, exercises have been moved to
    other parts of the beach where there are fewer turtles. At other times,
    exercises have been severely curtailed. For example, amphibious warfare
    training exercises have been moved, scaled back, or dropped only
    because of their potential to take more than one turtle.
        At Marine Corps Air Station, Miramar, California, plaintiffs filed
    suit in 1997 challenging the adequacy of Clean Air Act documentation
    supporting the Base Realignment and Closure realignment of helicopters
    and fixed-wing aircraft from Marine Corps Air Station, El Toro and
    Marine Corps Air Station, Tustin to the former Naval Air Station,
    Miramar. The Miramar realignment involved replacing 22 squadrons of
    Navy fixed-wing aircraft with 9 squadrons of Marine Corps fixed-wing
    aircraft and 8 squadrons of Marine Corps rotary-wing aircraft, totaling
    approximately 256 aircraft. The case continues to proceed under a
    settlement agreement, which includes a Marine Corps commitment to
    complete a new air quality analysis. Over 20 construction projects,
    valued at approximately $400 million, have been completed at Miramar,
    and both Marine Corps jets and helicopters are now operating there.
    Military operations and training continue to be at risk, however,
    unless conformity can be demonstrated and survive judicial scrutiny.

        46. Senator Inhofe. General Wald, recently Senator Bill Nelson of
    Florida has been speaking on the use of Eglin Test Range as a viable
    alternate to live-fire training at Vieques. What impact would moving
    the naval training to Eglin have on the ability of the Air Force to
    train? What impact would this have on the readiness of Air Force
    Special Operations Command forces?
        General Wald. The Navy is working on a strategy to delineate their
    requirements for fleet training in the future. Their Training Resource
    Strategy would validate current and future Navy requirements. For the
    east coast, the Navy is focusing on the use of existing DOD test and
    training infrastructure on the coast and in the Gulf of Mexico,
    including the Eglin range in Florida, the largest range in the east.
    The Air Force has six major commands operating in that area, including
    the Air National Guard, Air Force Reserve Command, Air Combat Command,
    Air Force Material Command and Air Force Special Operations Command,
    and Air Education and Training Command. We are committed to ensuring
    that all our units in the region continue to get the training they need
    to maintain the highest level of readiness possible.
        The subject of east coast training has been a frequent source of
    discussion between the Air Force and Navy. With many key Air Force and
    Navy missions on the east coast and the Gulf of Mexico, we are taking
    these discussions very seriously. Our goal is to establish a framework
    for a cooperative and integrated approach to joint training issues and
    effective range utilization.

        47. Senator Inhofe. General Wald, if the Navy ends live-fire
    training at Vieques, has the Air Force considered what might be the
    implications for Air Force training ranges? What might they be?
        General Wald. The Air Force operates two ranges in the southeast
    that can accommodate live weapons training--Shelby Range, Mississippi,
    and the Eglin Range, Florida, the largest range in the east. Other non-
    live-fire ranges operated by the Air Force in the east include: Dare
    County Range, North Carolina; Poinsett Range, South Carolina; Townsend
    Range, Georgia; Grand Bay Range, Georgia; and Avon Park Range, Florida.
        The Air Force is actively working with the Navy to develop a
    framework for a cooperative and integrated approach to range use. This
    framework will address equities involved in an effort to best
    accommodate the needs of all users and the local communities. We have
    opened a dialogue with the U.S. Navy and we are reviewing the training
    needs and facilities of both our services. As this review process
    matures, we will better understand how their needs can best be
    integrated with ours. We are committed to ensuring that our units
    continue to get the training they need to maintain the highest level of
    readiness possible.

        48. Senator Inhofe. General McKiernan, if the Navy ends live-fire
    training at Vieques, has the Army considered what might be the
    implications for Army training ranges? What might they be?
        General McKiernan. It is very difficult to predict the implications
    to Army ranges associated with the cessation of live-fire training at
    Vieques. The combination of conditions at Vieques makes for a complex
    social and political environment. The Navy faces issues of perceived
    public safety hazards, Clean Water Act compliance, Noise Control Act
    compliance, and very visible political activism. There are a number of
    Army installations with similar concerns stemming from potential for
    environmental enforcement and encroachment. Our concern is that if the
    Navy can not justify the use of the only range available for the
    Atlantic Fleet to conduct vital pre-deployment combined arms training,
    it will be difficult for any military service to justify the use of any
    live-fire range. This situation illustrates the power associated with
    the use of environmental laws and social activism to stop vital
    military training anywhere.

        49. Senator Inhofe. Admiral Krol, the Army and the Air Force
    indicate that they have unfunded requirements in support of their
    training ranges for fiscal year 2003. The Navy does not identify an
    unfunded requirement for training ranges. Is the Navy fully resourced
    to support training ranges, including Vieques, in fiscal year 2003?
        Admiral Krol. Fleet training, and training ranges in particular,
    can benefit from additional funding. In fiscal year 2002, $30 million
    above original programming has been provided to Commander in Chief,
    U.S. Atlantic Fleet to support increased range usage and increased
    flexibility in IDTC needed for ``surge'' CVBG deployments and the
    reduced turn-around ratio associated with Operation Enduring Freedom.
    This provides ``mission based'' pre-deployment training including
    future weapon systems employment by incorporating the best available
    technologies into Battle Force Team Training, to support current and
    anticipated missions. An additional $16 million has been requested in
    the DOD fiscal year 2002 Supplemental Request for that purpose. A
    similar effort to identify where our training infrastructure requires
    upgrade will also be done in the Pacific Fleet area of responsibility.
    Where it is appropriate, we will reprioritize our training funding to
    continue this effort in fiscal year 2003.
        Also, considerable effort is in progress to better define our fleet
    training and training range requirements Navy-wide. We are being
    careful to focus on providing the fleet with the capability, capacity,
    and flexibility to support fleet training requirements, not only for
    peacetime sustained operations, but in surge or wartime environments.
    The initial results of this work will be reflected in our fiscal year
    2004 budget inputs and will continue to mature in future years.
        Within the competing resource requirements, the fiscal year 2003
    budget provides adequate funding to support training range operations
    and meet deploying force training requirements.

        50. Senator Inhofe. Admiral Krol, in a meeting prior to the
    hearing, we discussed the problems of environmental compliance for the
    Navy to begin live-fire training at Vieques. According to Navy
    documents, the environmental issues facing the Navy are procedural,
    and, given a dedicated level of effort and proper management by the
    Navy, these issues could be resolved. Last fall, the Chief of Naval
    Operations (CNO) and the Commandant wrote a letter to the Secretary of
    the Navy requesting the use of Vieques to conduct live-fire training
    for the John F. Kennedy battle group. Was the Navy staff prepared to
    dedicate the personnel and resources necessary in the fall of 2001 to
    satisfy the environmental compliance procedural issues for the John F.
    Kennedy battle group live-fire Vieques operations requested by the CNO
    and the Commandant?
        Admiral Krol. In the fall of 2001, the Navy had defined the
    environmentally related steps needed to resume training with explosive
    ordnance while complying with pertinent environmental laws and
    regulations, and was prepared to pursue them when tasked to do so
    higher authority. A decision has not yet been made to resume explosive
    ordnance training.

        51. Senator Inhofe. Admiral Krol, according to press reports, the
    Commander in Chief of the U.S. Atlantic Fleet has initiated a Training
    Resources Strategy (TRS) to ``spread battle group training across many
    installations.'' What is the purpose of the TRS? On what date will the
    TRS be implemented?
        Admiral Krol. The purpose of the TRS is to provide the fleet a
    comprehensive and coherent program to link tactical training resources
    to readiness requirements. The program will provide multi-site training
    and multi-dimensional flexibility throughout the Navy's overseas
    deployment training process (IDTC). The TRS, as envisioned, will
    leverage existing DOD resources and will enhance training capabilities
    when and where there is greatest potential to improve combat readiness.
    Additionally, the Training Resources Strategy will permit naval and
    joint future technology enhancements to adjust the balance of live,
    virtual, and constructive (LVC) components of training as improvements
    in technology and simulation are fielded. The program is being
    implemented incrementally and is currently underway. As an example, the
    TRS plans delivery of the first Virtual At-Sea Training Deployable
    Pototype (VAST/DP) system in October 2003. With this technology, Navy
    surface ships will eventually be able to conduct NSFS qualification at
    sea, independent of a fixed land range. The TRS also proposes more
    extensive cross-service coordination of training conducted at various
    DOD range facilities, as is currently being negotiated between the Navy
    and the Air Force for ranges in Florida. Throughout the Atlantic Fleet
    area of operations, multi-site, multi-dimensional, and technology-
    enhanced training will add tactical depth and flexibility, provide
    surge capacity and share the benefits of capital investment to conduct
    concurrent CVBG/ARG-MEU operations and enhance training capabilities.
    The TRS is an evolutionary process that will provide direction to
    improve the Navy's readiness resourcing policy.

        52. Senator Inhofe. Admiral Krol, what level of funding is required
    to support the Training Resources Strategy in fiscal years 2002 and
    2003? Please itemize by fiscal year and purpose.
        Admiral Krol. The TRS will require approximately $45.452 million in
    fiscal year 2002 and $109.988 million in fiscal year 2003.
    Anticipated expenditures include the following:

    Facility construction and upgrades: $23.237 million
        NAP Key West hangars and maintenance building, inspection, and
    maintenance of Tactical Aircrew Combat Training System (TACTS) Towers,
    maintenance dredge to ship channel at Key West and Pensacola, upgrades
    to mine warfare capability at AUTEC, upgrades to Navy Dare County
    Range, Cherry Point Range, and upgrades to FACFACS Va Capes to provide
    an Exercise Control Group Cell.

    Feasibility studies for range enhancements: $920,000
        Naval Underwater Warfare Center (NUWC) studies at TACTS tower
    ranges and AUTEC for expanded fleet operations, mobile missilex
    capability study.

    Environmental studies and NEPA documentation: $6.3 million
        NEPA and site studies at Key West, Open Ocean (At-Sea
    Documentation, Virtual at Sea Training Deployable Prototype (VASTDP)
    and Avon Park Live Fire.

    Large Area Tracking Range (LATR): $1.5 million
        Upgrades the frequency tracking from 141MHZ to 433MHZ to comply
    with the remainder of the fleet's LA TR sites.

    Forward Area Combined Degaussing Acoustic Range (FACDAR) Range: $5.3
    million
        Provides a magnetic/acoustic sensing instrumented range to measure
    all ships for Mine Warfare vulnerabilities.

    Berry Island Mine Cable: $1.8 million
        Provides for the manufacture of an 8-mile cable to connect the
    instrumented tactical training mine field located at Berry Island,
    Bahamas to Little Stirrup Key, Bahamas to establish a permanent
    telemetry site for recording usage at the mine field.

    FACFACS Va Capes/Jacksonville ADSi Installation: $1.8 million
        ADSI provides LINK-16 surface picture from participating surface
    units operating in the east coast warning areas. Provides real time
    location of surface units which will enhance safety of range operations
    involving ordnance, aircraft, and ships and provide exercise control
    groups greater capability to conduct exercise injects with opposition
    forces.

    C/D Antenna for G1 Aircraft: $350,000
        Antenna will provide capability to relay control data for aerial
    drones in support mobile missile exercises for fleet training.

    Exercise Support: $1.315 million
        Provides fleet support with use of the boat Gosport which is used
    in large integrated exercises to launch BQM-74 drones, provide GPS
    suppression, act as an enemy vessel laying mines or provide a platform
    for navy and SEAL teams to practice hostile boarding of vessels. Also
    supports providing hulls for large sinking exercises (SINKEX).
    Present estimates for fiscal year 2003 TRS requirements include:
    Key West upgrades: $59 million
        Construction and additional existing building repair,
    infrastructure upgrades to fuel, electrical and water lines, and
    maintenance dredge of Key West.

    AUTEC Range upgrades: $5.894 million
        Berry Island minefield cable installation and permanent Ship Self
    Radiated Noise Measurement (SSRNM) facility installation.

    Environmental: $6.5 million
        NEPA compliance at Eglin AFB, NAS Pensacola, Avon Park Live Fire
    (only if contract cannot be awarded in fiscal year 2002), and Vieques
    clean-up.

    Exercise Support: $17.449 million
        Funds for the use of Eglin AFB, SSRNM portable until fixed site can
    be installed, mobile boat support (Gosport), mobile threats, and mobile
    at-sea missilex support.

    Instrumentation upgrades at Cherry Point: $530,000
        Provides support for coastal and ground threats and Beaufort TACTS
    tower support.

    Civilian personnel support for TRS: $381,000
        Provides for civil service and contractor support at CINCLANTFLT
    and Eglin AFB for the TRS.

    Mid Atlantic Electronic Warfare Range (MAEWR) and Cherry Point threat
    upgrades: $13.17 million
        Provides electronic threat emitters, mobile EW threat emitters,
    shipboard EW threat emitters, and communications/data links.

    Other OPN upgrades: $6.839 million
        Provides funding for the installation of hyqrophones at Beaufort
    TACTS towers for Naval Surface Gunfire Support (NSFS) systems, and
    fixed and mobile land target acquisition.

        53. Senator Inhofe. Admiral Krol, does the Training Resources
    Strategy consider the use of the Atlantic Fleet Weapons Training
    Facility (Vieques range) in Puerto Rico for Navy training in fiscal
    year 2002?
        Admiral Krol. Yes.

        54. Senator Inhofe. Admiral Krol, does the Training Resources
    Strategy consider the use of the Atlantic Fleet Weapons Training
    Facility (Vieques range) in Puerto Rico for Navy training in the first
    and second quarters of fiscal year 2003?
        Admiral Krol. Yes.

        55. Senator Inhofe. Dr. Mayberry, on page three of your written
    statement you describe the importance of having a training range
    infrastructure that ``supports realistic, combined arms, force-on-force
    training for our military,'' and that this is important because
    ``tomorrow's conflicts are likely to be short-notice, `come as you are'
    events, and we will need to fight joint and fight interoperable on a
    moment's notice.'' I couldn't agree with you more. In fact, I would
    suggest--and I know the CNO, the Commandant, and other warfighters
    agree--that Vieques fully supports joint operations under the most
    realistic conditions--the criteria that the Senior Readiness Oversight
    Council (SROC) has found deficient in other military ranges. What were
    the findings of the SROC with respect to Vieques? If the SROC did not
    evaluate Vieques, why not?
        Dr. Mayberry. The Department is committed to preserving the
    readiness and accessibility of the air, land, and sea test and training
    ranges that provide our forces with realistic, combined arms, force-on-
    force training opportunities needed to execute our defense strategy.
    The SROC has addressed Vieques repeatedly in recent years. In September
    1999, the SROC evaluated the importance of Vieques to the training
    readiness of the Atlantic Fleet. In December 1999, the SROC highlighted
    the impact of continued non-availability of Vieques on deploying
    carrier battle groups and Marine amphibious ready groups. The SROC
    reviewed and approved the Navy's implementation of temporary
    workarounds to meet minimum Atlantic Fleet training requirements--
    without access to Vieques. In May 2000, the Navy briefed the SROC on
    its experiences training the U.S.S. Eisenhower and U.S.S. George
    Washington carrier battle groups using alternate ranges. While the use
    of alternate sites achieved minimum training requirements for the Navy,
    limitations and training artificialities tremendously devalued training
    realism. Loss of the Vieques live-fire training area was addressed in
    several SROCs addressing encroachment of our test and training ranges.
    In June 2000, the SROC reviewed service readiness issues resulting from
    the encroachment of test and training ranges, and set direction for the
    development of a comprehensive, multi-faceted strategy for addressing
    these issues. The SROC approved a comprehensive strategy in November
    2000 and assigned appropriate responsibilities for its implementation.
    In January 2002, the SROC reviewed some administrative, legislative,
    and regulatory actions which would help preserve the sustainability of
    our test and training ranges.

        56. Senator Inhofe. Dr. Mayberry, if the Navy ends live-fire
    training at Vieques, have you considered what might be the implications
    for training ranges operated by the Navy and the other military
    services? What might they be?
        Dr. Mayberry. The important training opportunities that Vieques has
    provided our forces must be provided somewhere. Given Vieques' existing
    limitations and anticipated closing, the Navy and Marines have begun to
    conduct more of their training at other existing facilities. While we
    have not conducted live-fire training at Vieques for some time now, we
    continue to deploy ready battle groups and amphibious ready groups. The
    Navy and Marines are emphasizing the use of a variety of training
    ranges and operating areas in order to reduce reliance on a potential
    single point of failure during the Inter-deployment Training Cycle.
    This flexible approach should ensure access to necessary training,
    providing force readiness into the future.
        The impact at other range/operating area (OP AREA) complexes has
    been a small increase in the amount of live-fire activity they are
    being asked to support. The services and DOD will continue to evaluate
    how such changes in operations might impact the ranges and their
    surrounding communities, and will adapt accordingly. The Department's
    Sustainable Ranges Initiative is intended to ensure that, from here on
    out, we maintain needed access to important training and testing ranges
    and operating areas while sustaining the human and natural environment
    there.

                            AIR FORCE WEAPONS SCHOOL

        57. Senator Inhofe. General Wald, Major General L.D. Johnston,
    Commander of the U.S. Air Force Air Warfare Center at Nellis Air Force
    Base, testified before the House Armed Services Committee on the
    proficiency of students attending the Air Force Weapons School. He
    stated that the ``caliber of students . . . has decreased somewhat, as
    measured by student failure rates.'' General Johnston continued, ``This
    indicates a slow degradation of high quality combat training and
    experience levels over the years. Since 1991, our high deployment rates
    have reduced the amount of time aircrews have spent in realistic
    training, i.e., preparing for combat. Although per person `flying time'
    is approximately the same, a significant portion of that time has been
    spent conducting `no-fly' operations in Southwest Asia. There is an
    important distinction between flying time and range time. Operation
    Noble Eagle will have the same long-term effect.'' What are your
    thoughts on your colleague's comments? What is the relevancy of his
    comments when you are determining which units to deploy in support of
    commander in chief requirements?
        General Wald. Due to the type of flying required of aircrews in
    Southwest Asia and ONE, our crews are indeed flying at a comparatively
    slightly higher rate but with less mission-related training for a given
    sortie. In addition, less training has resulted in a shift toward a
    back-to-basics approach between deployments to ensure aviators continue
    to receive the most essential training to meet Commander in Chief
    (CINC) requirements. This has the effect of producing an aviator with
    the hours one might expect of a weapons school candidate, but not
    necessarily the experience level the school has seen in the past. When
    participating in the very demanding weapons school program these
    aviators may experience some difficulties and require additional
    training to meet standards, particularly if they attend the weapons
    school shortly after a long deployment. Nevertheless, our weapons
    instructor courses continue to produce enough graduates to meet the
    demands of the Combat Air Force (CAF) requirements. General Johnston's
    comments are relevant in determining not so much which units will
    deploy, but how the Air Force approaches the training of units to
    support CINC requirements in the face of reduced training
    opportunities. The Air Force carefully tracks pilot flying time and
    combat unit readiness and with very few exceptions our combat units are
    maintaining required readiness levels. In addition, the Air
    Expeditionary Force (AEF) construct provides the units approaching a
    deployment the opportunity to gain proficiency in the basic skills
    needed to perform the core-flying mission in support of the CINC. These
    efforts, and the provision of enablers such as flying hours and
    airspace availability, will remain critical to the Air Force's ability
    to deploy and employ weapons with unparalleled accuracy.

                  IMPLEMENTING THE QUADRENNIAL DEFENSE REVIEW

        58. Senator Inhofe. General Wald, the QDR outlined several
    decisions by the Department that impact the services. Specifically, the
    QDR stated that, for the Air Force, requirements are to increase
    contingency basing in the Pacific and Indian oceans, as well as in the
    Arabian Gulf. The Air Force will also ensure sufficient en route
    infrastructure for refueling and logistics to support operations in the
    Arabian Gulf and Western Pacific areas. What is the progress within
    your department to implement these decisions?
        General Wald. The Air Force conducted regional contingency basing
    studies, and presented the results to the Deputy Secretary of Defense
    in March 2002. These results proposed basing options to project force
    into and sustain logistics through the Pacific and Persian Gulf
    regions.
        The recommended advanced basing concept supports a range of
    operations from small humanitarian relief operations (HUMRO) through
    sustained projection of combat forces to support the Secretary of
    Defense's four defense policy goals of: assuring allies and friends;
    dissuading future military competition; deterring threats and coercion
    against U.S. interests by developing and maintaining capability to
    swiftly defeat attacks; and if deterrence fails, decisively defeating
    any adversary. The concept also supports OSDs Theater Security
    Cooperation plans.
        We are currently conducting more detailed analysis to determine the
    costs, in general terms, of implementing some of the options. Planning
    for refueling and logistics infrastructure is critical to successful
    execution of contingencies in any region, and our studies include those
    considerations.
        After we identify the costs of implementing the options under
    consideration we'll be in a better position to recommend specific
    basing arrangements, recognizing that significant additional or
    alternative basing would require significant expenditures.

        59. Senator Inhofe. General Wald, what has been the impact of the
    war on terrorism on implementing these decisions?
        General Wald. The impact of the war on terrorism has been to
    highlight the need to engage countries well in advance of contingency
    operations, ensuring expeditious deployment and operations. As an
    expeditionary force, the war on terrorism has not hampered the Air
    Force's short notice, rapid commitment capability. We continue to move
    forward in implementing QDR and defense policy goals. We remain
    committed and capable of protecting and advancing U.S. national
    interests and, if deterrence fails, swiftly and decisively defeating
    threats to those interests.

        60. Senator Inhofe. General Wald, is the Air Force adequately
    resourced in the Future Years Defense Program to implement these
    decisions?
        General Wald. Because the Air Force is in the process of building
    the fiscal year 2004 to 2009 Future Years Defense Program (FYDP), it is
    difficult to answer whether or not the Air Force is adequately
    resourced over the FYDP to increase its contingency basing in the
    Pacific, Indian Ocean, and Arabian Gulf. The Air Force is currently
    conducting a cost analysis of the various options for basing in those
    regions.
        After clarifying costs for selected contingency basing options, the
    Air Force will be able to better determine whether resources will meet
    requirements in this important area. Once specific basing and
    infrastructure requirements have been identified and validated by the
    appropriate commander in chief commands, the Air Force will fully
    assess resources to implement changes to our posture. While it is
    almost certain that a new basing posture would require significant
    resources, these new requirements will compete for funding later this
    year as part of the normal budget development process.
        Tide the on-going war against terrorism has impacted resources and
    Air Force contingency basing. The nature of the war on terrorism has
    put a new, even higher premium on the value of expeditionary forces
    that are readily employable and expeditionary basing that is readily
    available. This has been a resource challenge in terms of normal budget
    cycles, but one that with Congress' help we have been meeting
    adequately.

        61. Senator Inhofe. General McKiernan, the QDR outlined several
    decisions by the Department that impact the services. Specifically, the
    QDR stated that the Army will accelerate the introduction of the
    forward-stationed Interim Brigade Combat Teams (IBCTs) to strengthen
    deterrence and improve U.S. strategic responsiveness on a global basis.
    What is the progress within your department to implement this decision?
    What has been the impact of the war on terrorism on implementing this
    decision? Is the Army adequately resource in the Future Years Defense
    Program to implement this decision?
        General McKiernan. Defense plans for fiscal years 2003-2008 tasked
    the Army to conduct a study and develop a plan to station an IBCT in
    Europe by the end of 2007. On February 20, the Army Chief of Staff
    briefed the Deputy Secretary of Defense on the study's findings and
    provided OSD USD-P with a report on March 1, 2002. The Army fully
    funded the fielding of six IBCTs, and is currently waiting for the
    publication of the fiscal years 2004-2009 defense plans to determine if
    programming an IBCT in Europe is required. Currently, the Army has not
    funded an IBCT in Europe. With respect to the war on terrorism, the
    Army initiated several studies analyzing lessons learned from Operation
    Enduring Freedom and impacts from the global war on terrorism. It is
    too early to say what impact these lessons will have on the fielding of
    the IBCTs, but the Army will closely examine the results of these
    studies and determine what impacts, if any, there are.

        62. Senator Inhofe. Admiral Krol, the QDR outlined several
    decisions by the Department that impact the services. Specifically, the
    QDR stated that the Navy will increase aircraft carrier battlegroup
    presence in the Western Pacific and will explore options for
    homeporting an additional three to four surface combatants and guided
    cruise missile submarines in that area. What is the progress within
    your department to implement these decisions?
        Admiral Krol. Carrier Battlegroup presence: Prior to September 11,
    the Navy began building the long-range carrier schedule to meet the
    additional requirement in the Western Pacific. The global war on
    terrorism required Navy to modify the carrier battlegroup deployment
    schedule to meet the emerging operational requirements. We continue to
    develop long-range schedules that will meet the operational
    requirements.
        Homeporting three to four surface combatants in the Western
    Pacific: The Navy staff conducted an extensive study as directed by the
    fiscal year 2003-2007 Defense Planning Guidance (DPG) on homeporting
    three to four TBMD-capable surface combatants in the Western Pacific.
    The study concluded that the only feasible locations would be Japan and
    Guam. With respect to Japan, there is no excess available to increase
    the overall presence. Guam is capable of homeporting the additional
    ships. However, the cost of $750 million required to facilitate the
    additional ships may not be cost effective for the additional presence
    gained. The Navy is though in the process of home porting three attack
    submarines in Guam. The first two ships will arrive later this fall
    with the third SSN to arrive in calendar year 2003.
        Homeporting Guided Missile Submarines (SSGN) in the Western
    Pacific: The Navy also conducted a DPG-directed study on the
    homeporting of the SSGNs once they reach Initial Operating Capability
    (IOC). START I limits SSGN homeport alternatives to Bangor, Kings Bay,
    and Guam. Final homeport decision will be made prior to SSGN IOC in
    fiscal year 2007.

        63. Senator Inhofe. Admiral Krol, what has been the impact of the
    war on terrorism on implementing these decisions?
        Admiral Krol. As stated above, the decision to increase the overall
    presence in the Western Pacific has been impacted by the war on
    terrorism. The ability to homeport additional surface combatants and
    SSGN in the Western Pacific will not be directly impacted by the war.
    The decision to execute those decisions will be impacted by the other
    issues addressed above.

        64. Senator Inhofe. Admiral Krol, is the Navy adequately resourced
    in the Future Years Defense Program to implement these decisions?
        Admiral Krol. Carrier Battlegroup presence: Assuming that the
    global war on terrorism will not permanently change the carrier
    battlegroup deployment schedule, the Navy is adequately resourced in
    the FYDP to implement this decision. The Navy will be able to complete
    the development of the long-range carrier schedule begun prior to
    September 11.
        Homeporting three to four surface combatants in the Western
    Pacific: This study concluded that there were only two feasible
    locations to homeport three to four TBMD combatants--Japan and Guam.
    With respect to Japan, there is no excess availability to increase
    overall presence. Guam is capable of homeporting the additional ships,
    but there is a $750 million cost required to facilitate the additional
    ships. No decision has been made. There are no funds in the FYDP to
    implement this initiative.
        Homeporting Guided Missile Submarines (SSGN): This study is still
    ongoing. A decision will be made prior to SSGN IOC in fiscal year 2007.
    There are no funds in the FYDP to implement this initiative.

        65. Senator Inhofe. Admiral Krol, will implementing the direction
    from the Department require a modification/change to the Global Naval
    Forces Presence Policy?
        Admiral Krol. Inherent strengths of naval forces are that they are
    maneuverable, flexible, sustainable, and combat credible with little or
    no outside support. The Current GNFPP policy that identifies peacetime
    presence requirements and the apportionment of the force to meet those
    requirements has been adjusted, and GNFPP schedules will continue to be
    modified to meet the emerging operational requirements and to meet
    future operational requirements.

                               TRAINING RESOURCES

        66. Senator Inhofe. The Army has budgeted training for 10 rotations
    at the National Training Center (NTC) in fiscal year 2003. However, the
    commanding officer of the NTC has testified that the unavailability of
    strategic lift this year has had a significant impact on the quality of
    training being conducted at the NTC. He said, ``Two training rotations
    have not deployed their AH-64 attack helicopter units due to non-
    availability of C17/C5 airlift.'' Given the pace of current operations,
    will the Army be able to accommodate shortfalls in training resources,
    such as strategic lift, in order to conduct all of the planned
    rotations in fiscal year 2003 to the required standard?
        General McKiernan. The Army is closely monitoring the ability to
    conduct fiscal year 2003 Combat Training Center (CTC) rotations.
    Currently, the CTC program is funded at 84 percent of validated
    requirements but at 100 percent of requirements considered critical.
    This is sufficient to conduct rotations to standard, but will require
    deferment of some program support and CTC sustainment projects.
        Real world operations will continue to impact the availability of
    strategic lift, especially airlift. This has an impact on the ability
    to move rotary wing aviation assets, such as the AH-64, from some
    Continental United States locations (such as Fort Stewart, Fort Bragg,
    and Fort Campbell) to the NTC. Regardless of strategic lift
    availability, the training for the ground maneuver brigades will
    continue to standard, but with potential diminished fidelity for air-
    ground coordination and Army Airspace Command and Control (A2C2).

                       TRAINING AT FARALLON DE MEDINILLA

        67. Senator Inhofe. Admiral Krol, the Center for Biological
    Diversity (CBD), an environmental group based in New Mexico, filed suit
    in Federal district court in the District of Columbia on December 21,
    2000, against the Secretaries of Defense and Navy alleging that use of
    Farallon de Medinilla (FDM) by the Navy, Marine Corps, and Air Force as
    a live-fire training range violates the Migratory Bird Treaty Act
    (MBTA). The CBD asserted that the Navy never obtained a permit under
    the MBTA for the unintended killing or harming of migratory birds on
    FDM (the original permit request was denied by the Fish and Wildlife
    Service). The CBD also asserts that, pending issuance of a valid
    permit, the Navy should be enjoined from conducting future training
    exercises at FDM. Recently, the court concluded that the Navy had
    violated the MBTA and requested further briefs on whether an injunction
    is the appropriate remedy. FDM is the only air-to-ground target range
    under the control of the United States in the Western Pacific.
    According to the CINC of the U.S. Seventh Fleet, readiness would
    deteriorate to unacceptable levels within 6 months without a
    replacement for FDM. If the Department of Defense is ordered to stop
    training at FDM, how will this impact readiness? Do you agree with the
    assessment of the Seventh Fleet CINC? Is there a need for legislative
    relief?
        Admiral Krol. Both the Navy and the Air Force use Farallon de
    Medinilla (FDM), a small (about one-third square mile), uninhabited
    island in the Commonwealth of the Northern Mariana Islands (CNMI), as a
    bombing range. The island, leased from CNMI, is the only U.S.-
    controlled live-fire range in the Western Pacific and is currently in
    daily use as various units train for the war against terror. Because
    the island was inhabited by an endangered bird species, the Navy took
    extensive steps to protect that species by clearing another island of
    predators so the species could establish itself there. At the same
    time, the Navy carefully delineated the safest locations for targets
    and prohibited incendiary and carpet bombing by the Air Force on FDM,
    which principally protected migratory birds that use the island. The
    training at FDM has been further modified by reducing aircraft
    altitudes and dispersing birds with a low altitude flight before each
    sortie. To monitor the effects of military use of FDM, the CINC of the
    Pacific Fleet staff sends a biologist to the island monthly.
    Notwithstanding these costly measures, which reduce the effectiveness
    of training, the Navy has been sued by the Center For Biological
    Diversity, which demands that the Navy cease use of the island because
    the Navy does not have a permit under the Migratory Bird Treaty Act
    (MBTA) for any takes of migratory birds. The Navy sought such a permit
    from the USFWS, but was denied, because permits are not available for
    incidental (unintended) takes. Loss of use of this island would have a
    severe impact on training for Naval forces stationed in the Western
    Pacific and on Air Force long-range bomber training.

        [Whereupon, at 11:34 a.m., the subcommittee adjourned.]