[Senate Hearing 109-]
[From the U.S. Government Publishing Office]



 
       DEPARTMENT OF DEFENSE APPROPRIATIONS FOR FISCAL YEAR 2007

                              ----------                              


                        TUESDAY, MARCH 28, 2006

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:38 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Ted Stevens (chairman) presiding.
    Present: Senators Stevens, Bond, Shelby, Inouye, and 
Dorgan.

                         DEPARTMENT OF DEFENSE

                         Department of the Army

                        Office of the Secretary

STATEMENTS OF:
        HON. FRANCIS J. HARVEY, SECRETARY OF THE ARMY
        GENERAL PETER J. SCHOOMAKER, CHIEF OF STAFF, UNITED STATES ARMY

                OPENING STATEMENT OF SENATOR TED STEVENS

    Senator Stevens. Good afternoon, Mr. Secretary, General. We 
appreciate you bringing these young heroes to meet with us. 
We're happy to see them back, and pleased to see all of you 
here today.
    Our subcommittee today will receive testimony from the 
Secretary of the Army and the Army Chief of Staff. Secretary 
Harvey and General Schoomaker, we do welcome you back to our 
subcommittee, and I look forward to your testimony.
    As we meet today, we're still a Nation at war. Over 110,000 
Army soldiers are serving in harm's way in Afghanistan and 
Iraq. Our men and women in uniform are performing superbly 
under your challenging circumstances. And we're proud of our 
Army and are grateful for their service to the country, as I'm 
sure you are, Mr. Secretary and Commanding General.
    This appropriations cycle poses a number of important 
budgetary issues that will receive considerable debate and 
attention over the next few months. The budgetary challenges 
facing the Army include sustaining current operations, 
recruiting and retaining an All Volunteer Force, recapitalizing 
damaged and destroyed equipment, restructuring into a modular 
force, reposturing our forces around the globe, and fielding 
new technologies to the warfighter. I am told we have men and 
women in uniform in 146 nations as we speak today.
    A critical tool for addressing these issues is the Army's 
fiscal year 2007 budget proposal, which totals $111.8 billion. 
This represents a $12.7 billion increase over last year's 
enacted level. In addition, supplementals continue to increase 
Army spending accounts to pay for operations in Iraq and 
Afghanistan, as well as emerging equipment and soldier 
protection needs. The bridge supplement enacted just 3 months 
ago provided $31.1 billion for the Army. The current 
supplemental under consideration includes $34.5 billion for the 
service, and we're anticipating another supplemental request in 
the near future to help pay for operations during the first few 
months of fiscal year 2007.
    The large question is, Can we sustain this level of 
spending? History tells us we may not be able to do so.
    Mr. Secretary, General Schoomaker, the Army's going to be 
faced with many difficult choices in the near future. This 
afternoon, we're looking forward to hearing about your budget 
priorities and how you're positioning our forces for success 
today, as well as tomorrow.
    Let me turn to our co-chairman for his statement. We're 
proud and honored to have you with us.

                 STATEMENT OF SENATOR DANIEL K. INOUYE

    Senator Inouye. I thank you very much, Mr. Chairman. And I 
join you in welcoming our Secretary, as well as the Chief of 
Staff, General Schoomaker. And I wish to join my chairman in 
welcoming our heroes. Thank you very much for your service.
    Last year, we noted that the Army was in the midst of a 
period of dramatic change while simultaneously sustaining a 
high level of combat operations. We continue on this path as 
you transform the Army with new brigades, including the 
Stryker, while maintaining a large force in Iraq and 
Afghanistan. And as the chairman noted, the cost of these 
efforts, both in stress on the force and monetary resources, is 
understandably higher. One might even question whether it 
remains affordable.
    There is great concern that the pace of overseas 
operations, coupled with the upheaval of transforming the Army, 
is placing a very heavy burden on our volunteer force. We are 
concerned how these two changes will impact recruiting and 
retention, and impact the cost of maintaining this force.
    In the supplemental request presently before the 
subcommittee, we find a request for $3.4 billion to support the 
modular brigades, and an additional $5 billion requested for 
fiscal year 2007. And we have been advised that there are 
shortfalls in your fiscal year 2007 request for recruiting and 
retention activities. At the same time, there has been much 
discussion about how the National Guard fits into the Army 
plans, and whether changes in the force structure or force 
totals are advisable. So, I believe it is obvious that the 
request before the subcommittee contains controversial matters 
which require our attention.
    I'm equally positive that this subcommittee will maintain 
its strong support of the Army and the men and women in 
uniform, especially during these trying times. So, Mr. 
Chairman, I look forward to listening to our witnesses discuss 
the many challenges facing the Army.
    Thank you very much, sir.
    Senator Stevens. Well, thank you.
    Senator Bond, you have a statement?

                STATEMENT OF SENATOR CHRISTOPHER S. BOND

    Senator Bond. Mr. Chairman, I have a lengthy statement that 
I will not give. I'll give a few highlights of it, and anybody 
who wants to, we'll have it in the record, where it can be 
read.
    [The statement follows:]

           Prepared Statement of Senator Christopher S. Bond

    Secretary Harvey, General Schoomaker, I join with Chairman Stevens 
and Senator Inouye in recognizing the tremendous responsibilities you 
have been given in leading our soldiers in a time of intense conflict 
where the stakes could not be higher for our troops or our Nation.
    I want to comment briefly on three issues that impact Army 
readiness.
    It is my understanding that the Army procurement account currently 
stands at 16 percent of the Pentagon's overall budget which is the 
lowest amount among your sister services. Resources are always scarce 
and especially so in today's environment--so tough choices remain for 
you and this committee as we sort through the Army's and the Pentagon's 
overall budget. I mention this because the Guard and reserve accounts 
are sometimes adjusted in an effort to identify savings. The problem 
arises when accounts are impacted without the full and substantive 
input of Guard and reserve leaders--your Total Force partners. I 
believe you ran into this head-on with the issue of National Guard 
force structure before the ink was even dry on the Administration's 
fiscal year 2007 budget.
    I join with my National Guard Caucus co-chair, Senator Leahy, in 
applauding you for committing to fund fully the Army National Guard at 
an end-strength of 350,000 personnel. If we learned one important 
lesson, it is that the National Guard Bureau is not the only member of 
the Total Force team. The Nation's Governors and their Adjutant's 
General also have a vital role to play in the defense of the Nation, 
both at home and abroad. If we fail to give our Guard leaders a 
substantive role in the decision making process you can rest assured 
that the Congress will hear about it and is prepared to act decisively 
when core programs are threatened.
    This morning I was advised by Lieutenant General's Blum and Vaughn 
that Army National Guard end-strength will reach 337,000 by the end of 
the month and will reach the authorized end-strength of 350,000 by this 
Christmas at the earliest and a year from now at the latest. Betting 
against the Guard's ability to achieve its fully authorized end-
strength might be akin to betting against the George Mason University 
Patriots in this year's NCAA tournament so I'd advise you to watch the 
Guard's recruiting numbers closely so that you can ensure their 
accounts are funded in a manner commensurate with their end-strength.
    Late in December, Senator Leahy and I were successful in convincing 
our Chairman and Ranking Member to add $900 million to Guard accounts 
for homeland response related equipment. You will recall that the Guard 
was in some cases hindered from responding to all the calls it received 
for assistance--not because our Guard forces were not willing but 
because they did not have the necessary equipment. I hope, and trust, 
that the $900 million in funds the Congress added specifically for 
Guard equipment will eventually reach the right Guard accounts and ask 
that you provide my staff with an update on the status of those funds 
at your earliest convenience.
    On the topic of Army Transformation and Modernization, I am 
encouraged by the Army's insistence on sustaining the funding profile 
for Future Combat Systems. As the Congress reviews the relevance of 
specific programs and defense accounts it is imperative that Army and 
its industry partners continue to provide the Congress with updates on 
the overall status of the program to include both successes, challenges 
and failures. The level of sophistication and technology challenges 
resident within Future Combat Systems development is not without 
inherent risk. Yet failure to succeed in this endeavor is not an option 
because as we ask more from our soldiers it is imperative that we 
provide them with the most relevant, reliable and efficient materials 
for waging war on our enemies as possible. Future Combat Systems will 
translate into the decisive defeat of enemies and ensure that more of 
our soldiers return home. That is a goal worth pursuing.
    Finally, I have a question about Airlift and Logistical Support. 
The reason this is an area of concern for me is because portions of the 
C-17 are made in my home state of Missouri which is why I know 
firsthand about the issue.
    As you are fully aware, the Army is heavily dependent upon Air 
Force and the C-17 for its strategic lift. I am told that on Monday of 
last week in Iraq, C-17s achieved the millionth flying hour in 
service--which is equal to a cargo jet flying every minute of every day 
nonstop for more than 114 years. Assets like the C-17 are being used at 
170 percent of what was anticipated and they are carrying 80 percent of 
the cargo in support of the war on terror. Since September 11, 2001, 
the C-17 has flown 358,000 hours, or 59 percent more than originally 
scheduled, partly because of the wars in Afghanistan and Iraq, the Air 
Force said in an article published March 6 2006.
    With the reliance upon the C-17 so apparent I am concerned that the 
Pentagon's decision to limit the size of the C-17 fleet is premature. 
Once we close the line, Army's options for airlift will be severely 
constrained because the costs for reopening the line are prohibitive. I 
cite a Commerce Department report that projects the cost for closing 
and then reopening the line at $4.46 billion. With national security 
policy, and particularly Army and Marines forces, dependant upon the 
principles of rapid deployment and force projection we cannot afford to 
cut corners and pursue logistical airlift capabilities on the cheap.
    It was reported in the November 2005 edition of National Defense 
that ``The Army did away with the C-130 transportability requirement 
and, instead, stipulated that three FCS vehicles must fit in a C-17 
heavy lift cargo aircraft. This would allow for a 24-ton FCS.''
    The article further explains that concerns over the weight of FCS 
vehicles under development precludes them from being transported 
realistically by the smaller C-130 family of aircraft because of the 
need to ``strip down'' these vehicles so they will fit into the smaller 
C-130 aircraft. I can site other articles that mirror the concern that 
the Pentagon's plan to close down C-17 production may be woefully 
premature.
    This leads me to my first question.
    Based on the Army's dependance upon airlift for rapid mobility, the 
high usage rate of the C-17, and the ability this platform has over 
other logistical aircraft to transport the FCS family of vehicles to 
remote areas not accessible by other aircraft--are you confident that 
the Army has sufficient C-17 assets to meet its future logistical 
support needs?
    I have one additional question that regards what I understand is 
the Army's desire to outsource its lodging activities but in the 
interest of time I will submit the question for the record and ask that 
you get back to me.

    Senator Bond. Mr. Secretary and General, I join with the 
chairman and Senator Inouye and recognize the tremendous 
responsibilities you've been giving, leading our soldiers. And 
we welcome those brave men and women back who have been 
overseas. I'm proud to say that my son also has just returned, 
last month, from a year in Fallujah.
    It's my understanding that the Army procurement account 
currently stands at 16 percent of the Pentagon's overall 
budget, the lowest amount among your sister services. As 
resources are scarce, especially so in today's environment, you 
have tough choices facing you, and facing this subcommittee. I 
mention this, because the Guard and Reserve accounts are 
sometimes adjusted in an effort to identify savings. And this 
causes some problems. It causes some problems with Governors, 
with adjutants general, and with, oh, about 80 of us in the 
Senate. And I was pleased to be able to join with Senator Leahy 
and applaud you for committing to full funding of the Army 
National Guard at an end strength of 350,000 personnel. And we 
look forward to working with you on Guard issues.
    On a topic of Army transformation and modernization, I am 
encouraged by the Army's insistence on sustaining the funding 
profile for future combat systems (FCS). And it's imperative 
that the Army's industry partners continue to provide Congress 
with updates, but it is certainly a very appealing and possibly 
lifesaving effect-enhancing effort.
    Finally, about the C-17, you know--we all know how heavily 
dependent the Army is upon the Air Force and the C-17 for 
strategic lift. I'm told that, on Monday of last week in Iraq, 
C-17s achieved the millionth flying hour in service, equal to a 
cargo jet flying every minute of every day nonstop for more 
than 114 years. They're being used at about 170 percent of what 
was anticipated. They are carrying 80 percent of the cargo in 
support of the war on terror.
    With the reliance upon the C-17 so apparent, and I--as an 
amateur, as an outsider, I'm very impressed with what the C-17 
can do, but I'm concerned that the Pentagon's decision to limit 
the size of the C-17 fleet is premature. If we were to close 
the line, the Army's options for airlift would be severely 
constrained, because the costs for reopening the line are 
prohibitive, and there is no other airlift that I believe gives 
you the capacity that you have there. And I will look forward 
to asking a question about that at the appropriate time.
    Thank you.
    Senator Stevens. Thank you.
    Senator Dorgan.

                  STATEMENT OF SENATOR BYRON L. DORGAN

    Senator Dorgan. Mr. Chairman, thank you very much. Let me 
thank those who are here to testify, Secretary Harvey, General 
Schoomaker, and others.
    I do want to just mention--I don't know that I'll be able 
to stay for the entire hearing, but I do want to mention one 
issue with respect to Guard and Reserves and the length of 
deployment. I think that, you know, a substantial number of 
Guard and Reserve have been deployed in and out of the Iraq/
Afghanistan theater. And it appears to me now that when active 
duty folks are deployed, it's generally a 12-month period. I 
think the marines, it's 7 months. But the Guard in our State, 
when they are deployed, in--generally speaking, they are gone 
16 months--by the time they leave, go through the original base 
they're going to be assigned to and then get some training, 
then sent overseas, it's about a 16-month deployment. And these 
are citizen soldiers who have jobs, homes, and families. And 
it's sort of a paradox that they would have the longest 
deployment, because the Guard and Reserve, you would expect, 
would have the shorter deployments. So, I think my expectation 
is, that's going to have, and has had, a significant impact on 
retention. And my hope is that you might address some of that.
    I want to thank you, who represent America's soldiers. I 
think all of us on this subcommittee are determined that 
whatever is necessary for them to carry out their mission and 
to meet their responsibilities, we want to provide. We in this 
country, do not ever want to be in a circumstance where we 
would ask soldiers to go abroad and then not provide them 
everything that is absolutely necessary for them to do what we 
ask them to do for our country.
    So, let me thank you and hope, on behalf of this 
subcommittee, you will thank the troops, as well.
    Mr. Chairman, thank you very much.
    Senator Stevens. Thank you.
    Mr. Secretary, we'd be pleased to have your statement. Both 
of your statements, we'll print in the record as though read. 
We leave it to you how long--how much time you take.
    Mr. Harvey. Mr. Chairman, Senator Inouye, and distinguished 
members of the subcommittee, General Schoomaker and I 
appreciate the opportunity to be here today and to offer 
testimony on the posture of the United States Army.
    America's Army is the world's preeminent land power with a 
quality force of over 1 million soldiers supported by nearly 
240,000 Department of the Army civilians. An Army of Active, 
Guard, and Reserve soldiers deployed, forward stationed 
overseas, are securing the homeland, soldiers from every State, 
soldiers from every corner of this country serving the people 
of the United States with incredible honor and distinction.
    We provided the subcommittee the 2006 Army posture 
statement as our written statement, and I would like to take 
this opportunity to briefly highlight some of the Army's key 
initiatives and programs.
    General Schoomaker will also make an oral statement at the 
conclusion of my remarks. I know that this subcommittee, like 
me, appreciates the insight and unique perspective that General 
Schoomaker provides from his distinguished career of service to 
the Nation as a soldier.
    The soldier remains the centerpiece of America's Army. 
General Schoomaker will introduce to you three of those 
soldiers, here with us today, during his remarks.
    The 2006 Army posture statement is a succinct summary of 
the Army plan, which addresses the challenges of today, while 
preparing us for those we will face tomorrow. The Army plan is 
a comprehensive, fully integrated, strategic and operational 
plan which provides the roadmap to, first, build a more capable 
and relevant Army for the 21st century through transformation 
and modernization, and, second, sustain the full range of the 
Army's current commitments, particularly fighting and winning 
the global war on terror (GWOT).

                           ARMY MODULAR FORCE

    On 9/11, the Army's operational capabilities lacked the 
breadth and depth for the long war. We appreciate the 
continuing support of the Congress as the Army shifts its 
center of gravity to provide a broader portfolio of operational 
capabilities to meet the complex challenges of the 21st century 
security environment, particularly irregular, asymmetric 
warfare. For example, we have already completed the first 2 
years of converting the operational Army to a modular brigade-
based combat force. Our objective is 70 brigade combat teams 
(BCTs), or, as we like to call them, BCTs, and 211 support 
brigades. This is an increase of 46 percent in the number of 
BCTs over the current force. To date, we have completed the 
conversion or activation of 19 BCTs to the modular design, or 
approximately 27 percent toward the objective of 70 BCTs. In 
addition, we started the conversion or activation of another 
18.
    Even though the modular force is not complete, it has 
already increased our operational capabilities and established 
the foundation for a rotational force generation model that is 
structured, predictable, and provides more combat-ready units, 
while reducing stress on the force.
    In order to sustain the current mission and continue to 
posture for future commitments, the Army needs the full support 
of the Congress for the Army plan and the Army's request in the 
2007 Presidential budget.

                         FUTURE COMBAT SYSTEMS

    Additionally, beyond the importance of maintaining full 
funding for the modular force transformation, we also want to 
emphasize the importance of full funding for the future combat 
systems program. This is a key modernization program for the 
Army, and is really the first major ground force modernization 
effort in over four decades. Although the word ``future'' is in 
the program title, this is not a program that only exists on 
PowerPoint slides. FCS is becoming a reality today, and 
spinouts of FCS technology to the current modular forces will 
begin in 2008.
    Simply put, the FCS program is the fastest and surest way 
to modernize the Army. Furthermore, it is the only way to 
effectively modernize the Army in an integrated manner.
    The FCS program and the modular force initiative (MFI), in 
conjunction with the full spectrum of other programs in the 
area of research and development (R&D), acquisition, training, 
leadership development, advanced tactics, techniques, and 
procedures, business transformation, as well as the growth of 
the operational Army, will ensure that our overall capability 
to conduct both traditional and nontraditional operations, 
including the global war on terrorism, will continuously and 
methodically increase and improve as we go forward in the 
uncertain and unpredictable 21st century.

                          ALL VOLUNTEER FORCE

    We also need to draw your attention to the importance of 
our efforts, with your support, to sustain an All Volunteer 
Force, including recruiting, retention, and providing a quality 
of life for our soldiers that matches the quality of their 
service. This is the first time in our modern history that the 
Nation has tested the concept of an All Volunteer Force in a 
prolonged war. Full funding and support of Army programs in 
this way is critical to sustain the finest Army in the world.
    Finally, I want to emphasize that the Army plan is a total 
plan to transform the entire Army--Active, Guard, and Reserve. 
2005 reaffirmed to the people of the United States that we are 
truly an Army of one. Simply put, the Army could not perform 
full-spectrum operations without the tremendous contributions 
of the Guard and Reserve. For example, last year the Army 
National Guard had 10 brigade combat teams and a division 
headquarters serving in Iraq, Afghanistan, and the Balkans for 
at least a portion of the year. Despite this overseas 
commitment, the National Guard was still capable of responding 
with 42,000 soldiers in a little over a week to support 
Hurricane Katrina relief operations. And, I might add, there 
were still tens of thousands more Guard and Army Reserve 
soldiers available, if needed.
    Based on the insights of 9/11, homeland defense operations, 
hurricane recovery operations, and lessons learned from the 
global war on terror, the Army plan shifts the focus of the 
Reserve component from a strategic Reserve to an operational 
force and rebalances the Reserve component's force structure to 
the operational skills they need for the 21st century security 
environment. For example, in the current plan the Army National 
Guard will continue to maintain a total of 106 brigades, which 
are beginning to be transformed to the same modular design as 
the Active Army. However, we are changing the organizational 
mix of brigade combat teams and support brigades based on the 
capabilities needed to conduct both their national defense, as 
well as their State, missions. In essence, the Army National 
Guard and the Army Reserve are transforming and modernizing 
from an underresourced standby force to fully equipped, manned, 
and trained operational-ready units.
    Let me close, and give General Schoomaker an opportunity to 
address the subcommittee, by saying that I remain confident 
that with the continued strong support of the Congress, 
America's Army can accomplish its mission and reach our 
strategic goal of being relevant and ready both today and 
tomorrow.
    Thank you.
    Senator Stevens. Thank you, sir.
    [The statement follows:]

Prepared Statement of Francis J. Harvey and General Peter J. Schoomaker
                                                 February 10, 2006.

    We have the confidence of the Nation as we continue to engage in a 
long struggle against global terrorism and the conditions that give it 
life and sustain it. Over a half-million active and reserve Soldiers 
have served overseas in the war on terrorism. More than 600,000 
Soldiers are on active duty today. Almost half of them are deployed, 
serving in 120 countries worldwide in defense of United States 
interests.
    While fighting, we are preparing Soldiers and leaders for the 
challenges that they will face. We continue to transform, to modernize, 
and to realign our global force posture. Our Army continues to evolve 
from a force dependent on divisions to deter and to wage war against 
traditional adversaries, to a force dependent on modular brigades, 
specially designed for the full range of non-traditional adversaries 
and challenges it will face.
    With the support of the President, the Congress, and the Secretary 
of Defense, we have developed and resourced a fully integrated plan to 
best serve the Nation, to deal with the challenges we will face today 
and tomorrow, and to sustain our volunteer Soldiers in this time of 
war.
    To execute this plan, we are depending upon continued Congressional 
leadership in three areas:
  --Obtaining legislative authorities to assure predictable access to 
        our Army National Guard and Army Reserve Soldiers who have 
        become, by necessity, our operational rather than our strategic 
        reserve;
  --Expediting wartime acquisition processes needed to equip and 
        protect our Soldiers; and
  --Of greatest importance, maintaining the support of the American 
        people whom we serve.
    To continue to meet the needs of the Combatant Commanders and the 
Nation, the Army will require the full support of the resources 
requested in the base budget and in supplemental appropriations.
                                         Francis J. Harvey,
                                             Secretary of the Army.
                                       Peter J. Schoomaker,
                       General, United States Army, Chief of Staff.

      PURPOSE AND ORGANIZATION OF THE 2006 ARMY POSTURE STATEMENT

    The 2006 Army Posture Statement describes how the Army is executing 
The Army Plan to meet the challenges of today and to be better prepared 
for those we will face tomorrow. Focusing on the Soldier, our 
centerpiece, the Posture Statement summarizes key implications of the 
21st century security environment. This discussion provides the context 
to examine the Army Vision to accomplish our enduring, 
constitutionally-derived mission.
    The Army Plan consists of four overarching, interrelated 
strategies, focusing on people, forces, training and infrastructure. We 
explain our initiatives, accomplishments, and compelling needs as they 
relate to each of these strategies. We describe transformation, not as 
an end in itself; but rather, how it has helped us to accomplish our 
mission and to realize our vision.
    We conclude with a discussion of risk to underscore our compelling 
needs.



    This Posture Statement is designed to serve as a primary portal to 
learn about the Army. A listing of helpful Army-related websites and a 
glossary of acronyms are also provided.
             2006 army posture statement executive summary
    Soldiers are making enormous contributions and sacrifices while 
serving at the forefront of a long struggle of continuous, evolving 
conflict. Their presence has enabled historic elections in Afghanistan 
and Iraq, and is setting the conditions for democratic institutions to 
take hold. Our Soldiers are also preventing attacks on our Nation and 
responding to natural disasters at home and abroad, while sustaining 
the full range of America's global commitments. At the same time, to be 
ready for the challenges we face today and tomorrow, we are 
accelerating our plan to transform and modernize.
    We are executing The Army Plan to accomplish our mission and to 
realize our vision: to remain the preeminent landpower on Earth--the 
ultimate instrument of national resolve--that is both ready to meet and 
relevant to the challenges of the dangerous and complex 21st century 
security environment. Our plan consists of four overarching, 
interrelated strategies (Figure 1).




    This fully integrated plan is driving change at an unprecedented 
pace. We are becoming a more powerful, more flexible, and more 
deployable force with a broad set of capabilities to deal with the full 
spectrum of challenges we will face. Our improvements will enable our 
Soldiers to sustain the full range of global commitments which extend 
beyond today's current theaters of war. We are improving our ability to 
operate with joint and coalition partners and to perform nontraditional 
operations. We are also developing better ways to manage increasing 
demands for forces and relieve stress on Soldiers, their families, and 
civilian workers to sustain our All-Volunteer force.
    Four key ideas underpin our planning:
  --First, we remain committed to producing units that are ready for 
        the challenges they will face and to overcoming years of 
        underfunding prior to the events of 9/11. We have received 
        unprecedented support to ``buy back'' much needed capability. 
        We cannot, however, fool ourselves by maintaining large numbers 
        of forces on paper that, in reality, lack the people, 
        equipment, training, and support needed to accomplish the 
        missions that they will be assigned. We are determined to 
        support our Soldiers and their families with an improved 
        quality of life that matches the high quality of service they 
        perform for America.
  --Second, we recognize that intellectual change precedes physical 
        change. For this reason, we are developing qualities in our 
        leaders, our people, and our forces to enable them to respond 
        effectively to what they will face. We describe the leaders we 
        are creating as ``pentathletes,'' whose versatility and 
        athleticism--qualities that reflect the essence of our Army--
        will enable them to learn and adapt in ambiguous situations in 
        a constantly evolving environment. We have undertaken a major 
        review of how we train, educate, assign, and develop our 
        military and civilian leaders to ensure that our Soldiers are 
        well-led and well-supported as they deal with complexity and 
        uncertainty for the foreseeable future.
  --Third, reinforced by the American military experience of the 20th 
        century, we believe that our Soldiers' effectiveness depends 
        upon a national commitment to recruit, train, and support them 
        properly. This commitment must be underwritten by consistent 
        investment in their equipment and infrastructure. We remain 
        acutely aware of fiscal constraints; however, our duty to do 
        what is right for our Soldiers, their families, and the Nation 
        remains firm and unwavering.
  --Fourth, we remember our position at the start of the long struggle 
        in which we are engaged. After years of insufficient 
        modernization investments, many of our units were underequipped 
        and not immediately ready for deployment, especially in our 
        reserve units. To meet Combatant Commanders' wartime needs, we 
        pooled equipment from across the force to equip those Soldiers 
        deploying into harm's way. This increased risk in other 
        capabilities, as seen in the Army National Guard during our 
        national response to Hurricanes Katrina and Rita. With help 
        from the President, the Congress, and the Department of Defense 
        through supplemental appropriations, we have addressed many of 
        our equipment shortfalls. We still have much to accomplish to 
        ensure force readiness and to mitigate risk.
    To sustain the current mission, posture for future commitments, and 
maintain risk at acceptable wartime levels, the Army needs:
  --Full funding of the Army request in the 2007 President's Budget and 
        special consideration, in light of wartime demands, for 
        avoiding any reductions to the Army's budget and program. In 
        addition, supplemental funding is required for combat and 
        contingency operations and to continue to reset, repair, 
        recapitalize, and replace battle losses of equipment for 
        several years beyond major deployments. Supplemental funding is 
        needed to overcome the stress on equipment resulting from 
        sustained combat operations in harsh environments. These 
        resources will ensure that the Army is fully manned, trained, 
        and equipped to achieve victory in the war on terrorism. These 
        resources will also enable the Army to maintain the momentum of 
        key programs, while accelerating transformation.
  --Funding to increase Army capabilities and overall capacity as well 
        as support for the legislative authorities and programs needed 
        to assure access to our reserve components--who, by necessity, 
        have become an operational vice a strategic reserve. We must 
        achieve a proper balance of capabilities and skills among our 
        active and reserve forces and continue to build high-quality 
        units to increase capability and ease the strain on our 
        deployed Soldiers.
  --Support and funding to achieve critical recruiting and retention 
        goals needed to grow operational forces. Meeting these goals 
        for our active and reserve Soldiers sustains the quality and 
        effectiveness of our All-Volunteer force.
  --Funding for the Future Combat Systems (FCS) program--to enhance 
        current force capabilities today with ``spin outs'' of 
        available technology--and accelerate more than 300 other 
        modernization programs. Our most critical investment program, 
        FCS will be the Army's first major modernization in over 30 
        years and will better prepare and protect Soldiers for current 
        and future threats. These capabilities will directly benefit 
        our active and reserve components, all United Statesground 
        forces, and our allies that support ground campaigns.
  --Full funding to maintain momentum in building a rotational pool of 
        70 Brigade Combat Teams (BCTs) and more than 200 modular 
        Support Brigades and headquarters. Already well under way, our 
        transformation to become a fully modular force is preparing our 
        Soldiers to conduct sustained operations of the type we see 
        today. In addition, our transformation is increasing the depth 
        and breadth of our capabilities to prepare our Soldiers for 
        tomorrow's challenges, particularly as we evolve to maintain 
        overseas presence with rotational units.
  --Full funding for Army installations and support to execute a 
        carefully synchronized plan to achieve a new global basing 
        posture, while fulfilling the requirements of the National 
        Military Strategy. This plan will make full use of the 
        resources currently apportioned and projected to be recouped 
        through consolidation and closings. Unanticipated costs 
        associated with environmental remediation, renovation, 
        construction, and other areas, may require additional resources 
        in future years (a situation that will require continuous 
        reevaluation). Full funding and continued support for Army 
        installations and quality-of-life programs is required to 
        sustain the All-Volunteer force, now being tested for the first 
        time in a prolonged war.
  --Support for funding and authorities for Army Business 
        Transformation initiatives to achieve targeted efficiencies 
        through management reform, Institutional Army adaptation, and 
        reengineered business practices. These initiatives will free 
        human and financial resources for more compelling operational 
        needs and accelerate other aspects of our transformation.
    A complete, detailed list of our Compelling Needs for 2007 is 
provided in Figure 2.



    2007 will be a pivotal year for the Army. We will continue to 
conduct operations while transforming the force, its global 
infrastructure, and all of our supporting business processes. The 
resources provided to the Army in 2007 and beyond will enable the Army 
to maintain the momentum of key programs, while accelerating aspects of 
our transformation.Moreover, this funding will determine our ability to 
continue to accomplish our mission and to be postured to meet future 
commitments.

     21ST CENTURY SECURITY ENVIRONMENT: AN ERA OF UNCERTAINTY AND 
                            UNPREDICTABILITY

    In the four years since the terrorist attacks on the Nation, the 
international security environment has changed dramatically. As a 
result, military commitments and especially the demand for Soldiers 
have increased both at home and abroad. With the support of the 
President, the Congress, and the Secretary of Defense, we have 
increased our capabilities to deal with the challenges we are facing 
today and accelerated our preparation for those we will face tomorrow.

Complex Security Challenges
    The National Defense Strategy identifies an array of traditional, 
irregular, catastrophic, and disruptive challenges that pose threats to 
the Nation (Figure 3). These threats are becoming increasingly complex. 
We no longer face only conventional armies who operate within clearly 
established political boundaries. In addition, we will face enemies 
that employ irregular tactics, terror, and asymmetric warfare. These 
enemies will be increasingly transnational and dispersed.
    Fueled by ideologies that oppose our Nation's bedrock values, al-
Qaeda and other enemies are committed to reducing American global 
presence and to destroying our society. They have publicly stated their 
goal: to gain control in the Islamic world by establishing a unified 
caliphate, stretching from North Africa to Indonesia.
    We are engaged in a long struggle against adversaries who are 
ruthless and unconstrained in achieving their ends. Our previous 
conceptions of security, deterrence, intelligence, and warning do not 
adequately address the threats we now face. To defeat our adversaries, 
who will be neither deterred by nuclear or conventional weapons nor 
defeated in battles with decisive outcomes, we must remain vigilant in 
employing all forms of national and international power--diplomatic, 
informational, military, and economic--in a concerted, integrated 
manner.



Increasing Complexity
    The security environment in which our Soldiers will operate is 
characterized by challenges and uncertainties, including:
  --Progress in the war on terrorism;
  --The pace of democratic reform in the Middle East and elsewhere, 
        especially in fledgling democracies such as Iraq, Afghanistan 
        and the emerging Palestinian State;
  --The ability of existing governments to perform traditional state 
        functions and deny safe haven to terrorist groups;
  --Progress in controlling the proliferation of weapons of mass 
        destruction to state and nonstate actors; and
  --Decisions in four major areas:
    --Defense priorities amidst growing fiscal pressures;
    --Roles and missions of the Armed Forces as defined in the 
            Quadrennial Defense Review;
    --Role of the Armed Forces in defense support to civil authorities; 
            and
    --Pace of implementation of Base Realignment and Closure (BRAC) 
            legislation and Integrated Global Presence and Basing 
            Strategy (IGPBS) plans.

Competing Fiscal Priorities
    The Army will remain engaged around the globe, while operating in a 
constrained fiscal environment. This will continue to limit the 
resources available to accomplish our missions.
            National Budget Trends
    The Office of the Secretary of Defense, Comptroller, projects 2007 
Defense spending will be 3.9 percent of Gross Domestic Product (GDP), 
continuing a downward trend (Figure 4). Defense resources have not kept 
pace with growth in GDP.



            Defense Budget Trends
    The allocation of Defense resources has changed over time (Figure 
5) in response to the focus and demands of the National Military 
Strategy. Today, despite providing the bulk of the forces for the war 
on terrorism, the Army receives the smallest share of programmed 
resources. Increasing pressure to reduce the federal deficit, coupled 
with rising fuel, health care, and other costs, may impact the 
resources appropriated to accomplish Army missions.



            Army Investment Trends
    The bulk of the Army's funds are committed to sustaining people, 
maintaining vital infrastructure, and preparing equipment for combat 
deployment. As a result, our ability to fund investment accounts is 
extremely limited (Figure 6). This creates a perennial tension between 
current and future demands.



Investment Trends
    Since 1990, the Army's share of investment dollars has been 
considerably smaller than that of the other Departments (Figure 7). 
Consequently, the Army has been unable to invest in the capabilities to 
sustain a rising operational tempo and to prepare for emerging threats. 
Supplemental authority has enabled the Army to ``buy back'' crucial 
capability to meet the operational demands of the war on terrorism and 
to improve our ability to sustain the full scope of our global 
commitments.



Implications for the Army
    The implications of the evolving security environment are clear.
  --The Nation will continue to be engaged in a long struggle of 
        continuous, evolving conflict that, as in Afghanistan and Iraq 
        today, will manifest itself in complex, traditional, and 
        irregular challenges to include cyberspace attack. These 
        struggles will be waged by Soldiers who will be expected to 
        perform difficult tasks and create decisive outcomes to 
        accomplish the objectives of the National Military Strategy.
  --Our Soldiers must be prepared to deal with the full spectrum of 
        threats. As described in the Army's capstone concept for the 
        future force, they must be able to operate effectively as part 
        of joint, interagency, and coalition teams.
      Therefore, we must continue to improve the strategic 
        responsiveness of our forces and our generating base through 
        improvements in:
    --strategic agility;
    --joint interdependence;
    --speed;
    --survivability;
    --lethality;
    --sustainability;
    --networks to improve situational awareness and command of forces; 
            and
    --information assurance and network security
  --Our Soldiers and units must be prepared to operate with little to 
        no warning. We will no longer have the luxury of partially 
        manning, equipping, or training a unit and relying on 
        significant warning time to mobilize, train, and prepare to 
        deploy. Rather, the units we have designated to be available 
        for deployment will need their full complement of Soldiers, 
        equipment, and training to be ready for immediate deployment 
        from our power projection infrastructure.
    Failure to invest in Soldiers to build the right capabilities--by 
improving our doctrine, organizations, training, materiel, leaders, 
people, and facilities--will increase risk for the Army, the Joint 
Team, and our Nation. Building the capabilities required to hedge 
against the uncertainty of tomorrow will require prudent investments 
today. These investments must be sustained at predictable, consistent 
levels over time. Investing in defense capabilities in this manner 
would reflect a significant departure from historic patterns of 
spending, which have increased America's vulnerability prior to each of 
the major conflicts of the 20th century.

 THE ARMY VISION: RELEVANT AND READY LANDPOWER IN SERVICE TO THE NATION

    The challenges posed by the 21st century security environment drive 
our vision of the force we must become to continue to accomplish our 
mission. The Nation has entrusted us to preserve peace, maintain 
freedom, and defend democracy. We have performed this role for more 
than 230 years. Today, because of the actions of our Soldiers and our 
record of accomplishment, the American people regard the Army as one of 
the Nation's most respected institutions. We will maintain this trust.



               mission: providing forces and capabilities
    The Army exists to serve the American people, to protect vital 
national interests, and to fulfill national military responsibilities. 
Our mission is enduring: to provide necessary forces and capabilities 
to the Combatant Commanders in support of the National Security and 
Defense Strategies. The Army is also charged with providing logistics 
and support to enable the other Services to accomplish their missions. 
The Army organizes, trains, and equips Soldiers who, as vital members 
of their units, conduct prompt, sustained combat on land as well as 
stability operations, when required.

Accomplishing the Mission Today: Sustaining Global Commitments
    The Army continues to provide Combatant Commanders with a wide 
range of capabilities to prevail in the war on terrorism and to sustain 
our global commitments. These capabilities include support to civil 
authorities in response to threats and crises at home. Our worldwide 
commitments extend far beyond Iraq and Afghanistan. Today, 
approximately 600,000 Soldiers are on active duty (currently 487,000 
active component, 72,000 Army National Guard and 41,000 Army Reserve), 
with 245,000 Soldiers serving worldwide in 120 countries (Figure 8). 
More than 1,700 Army civilians serve side-by-side with them in the 
field. Our Soldiers and civilians perform a variety of missions vital 
to America's national defense. Here at home, more than 13,000 Soldiers 
are on duty specifically fulfilling critical missions to support the 
Global War on Terrorism.
    The Army's operational pace remains high, sustaining obligations 
and continuing trends established during the post-Cold War era. In 
addition to Iraq and Afghanistan, our forward presence continues to 
preserve peace on the Korean Peninsula, the Sinai, the Balkans, and 
numerous other places of strategic importance.
    Whenever and wherever needed, Soldiers continue to answer the Call 
to Duty. During this past year, Soldiers supported civil authorities 
during a variety of disaster relief and recovery missions. More than 
42,000 National Guard Soldiers; 7,300 active component Soldiers; and 
3,500 Army civilians assisted citizens in Louisiana, Mississippi, 
Texas, and Florida after Hurricanes Katrina and Rita. Active and 
reserve aviation units flew thousands of helicopter sorties. These 
pilots and crews saved countless lives while distributing food, water, 
and other supplies. Working closely with state and federal agencies, 
the Army Corps of Engineers provided emergency support and is now 
executing more than $4 billion worth of projects to support recovery. 
Soldiers also provided relief for earthquake survivors in Pakistan. At 
home and abroad, on a daily basis, our Soldiers and civilians are doing 
critical work in service to our country.




    In the four years since September 11, our National Guard has 
mobilized more than 329,000 Soldiers for both state and federal 
missions. On any given day, the Army National Guard provides vital 
capabilities in virtually every mission area. As of January 2006, more 
than 72,000 Soldiers from the National Guard are mobilized. Besides 
their commitments in Iraq and Afghanistan, National Guard Soldiers are 
protecting the homeland by securing borders, protecting key 
infrastructure, and securing special events such as the Super Bowl. 
They also support other missions of U.S. Northern Command. They are 
preserving peace in the Sinai and in the Balkans. They are also 
establishing the conditions for continued progress in Iraq and 
Afghanistan.
    Since September 11, the Army Reserve has mobilized over 143,000 
Soldiers who, together with their fellow active and National Guard 
Soldiers, have enabled the Army to accomplish its mission at home and 
abroad. The Army Reserve provides vital capabilities across a diverse 
range of mission areas. As of January 2006, more than 41,000 Army 
Reserve Soldiers serve on active duty. The Army Reserve's 98th and 80th 
Divisions (Institutional Training) deployed to Iraq and Afghanistan to 
support U.S. Central Command's training of security forces.

Major Decisions in 2005
    During 2005, the Army made four key decisions to accelerate change 
needed to win today and to continue to prepare for tomorrow's 
challenges.
  --Accelerated the Fielding of the Future Force.--In April 2005, the 
        Army announced refinements of its plan--The Army Plan--to 
        transition continuously from the current force to the future 
        force to realize the Army Vision. This plan guides our efforts 
        to transform the Army into a modular force, while continuing to 
        modernize by fielding Future Combat Systems (FCS) and other 
        technologies. We are leveraging recent combat experiences to 
        train and educate our Soldiers and leaders and provide the 
        campaign and expeditionary capabilities needed to deal with 
        future challenges.
  --Restructured the FCS Program.--In April 2005, the Army restructured 
        the FCS program for two reasons: (1) to improve contractual 
        arrangements with industry and provide a better framework to 
        manage the cost and schedule aspects of this vital program; and 
        (2) to further leverage FCS technologies as quickly as feasible 
        to improve our Soldiers' ability to fight and to protect 
        themselves. By improving control and oversight, these new 
        arrangements are paying dividends now.
  --Established the Business Transformation Initiatives.--In February 
        2005, the Army decided to implement an Army-wide Business 
        Transformation initiative. (We are reviewing all of our 
        business, resourcing, management, and acquisition processes to 
        become more effective, improve quality, reduce cycle time, and 
        achieve cost reductions.) To do so, we are applying the Lean 
        Six Sigma methodology. Just as we are leveraging the lessons of 
        war to improve fighting effectiveness, we are applying relevant 
        corporate best practices to improve our business processes and 
        make best use of our financial, human, and materiel resources. 
        Other key aspects of Business Transformation include: 
        Information Management Systems Portfolio Management, 
        Institutional Army Adaptation, and Business Initiative 
        Councils.
  --Adopted the Army Force Generation (ARFORGEN) Model.--The Army began 
        to implement the ARFORGEN model to ensure all units are fully 
        ready for deployment. This model will establish and coordinate 
        cycles of readiness and training for all active and reserve 
        units. To sustain our ability to execute the National Military 
        Strategy, this model schedules deployment windows for our units 
        while balancing the requirements associated with transforming, 
        modernizing, implementing a new global stationing plan, and 
        other mission demands.

             THE ARMY PLAN TO ENABLE MISSION ACCOMPLISHMENT

    We are executing The Army Plan, consisting of four overarching, 
interrelated strategies, to enable mission accomplishment and to 
achieve the Army Vision over time. This plan accelerates the redesign 
of the forces, support structures, and headquarters that are 
accomplishing our mission today. This plan also guides our initiatives 
to provide the Combatant Commanders the assets to protect the Nation 
today and tomorrow.
    The Army is:
  --Providing relevant and ready landpower for the 21st century 
        security environment;
  --Training and equipping Soldiers to serve as warriors and growing 
        adaptive leaders;
  --Sustaining an All-Volunteer force composed of highly competent 
        Soldiers that are provided an equally high quality of life; and
  --Providing infrastructure and support to enable the force to fulfill 
        its strategic roles and missions.
    We are transforming to create a future force with a broad set of 
capabilities to enable our Soldiers to address strategic problems the 
Nation will face (See Figure 9).
    The benefits of our approach are clearly evident in the attitudes 
and levels of commitment we see in our Soldiers, as well as the 
attributes of our combat formations, the forces that sustain them, and 
the facilities and business processes that generate them from their 
home stations. The combined effects of transformation, modernization, 
innovation, and improvement--reinforced by positive change in the 
attitudes and behaviors that create the culture of our service--are 
helping us to become the force the Nation will need to safeguard its 
peace and freedom in the 21st century.

    ----------------------------------------------------------------

 Examples of Unique Army Capabilities to Support Joint, Combined, and 
                         Interagency Operations
Countering Terrorism
    Assist friends, allies, or partners to conduct military operations 
by providing logistics, command and control, intelligence, protection, 
and other support to the Joint Force.
    Train military and security forces to counter extremist, radical, 
or insurgent elements.
    Provide ground forces (conventional and special operations) to 
sustain large-scale counter-terror and counter-insurgency operations.
    Rapidly deploy substantial numbers of ground forces from strategic 
distances to meet Combatant Commanders' requirements for counter-terror 
or combat operations.
    Conduct extended stability operations.
Defending the Homeland
    Detect and prevent hostile actions against the homeland through the 
presence of the National Guard and the Army Reserve within states and 
communities.
    Support civil authorities in consequence management, disaster 
relief, and other roles including: reinforcing public safety and 
providing logistics, transportation, communications, utilities 
management, engineering, and other services.
Shaping Choices of Countries at Crossroads
    In support of Combatant Commanders, establish relationships with 
foreign leaders, forces, and people through: security cooperation, 
training, humanitarian and civil assistance, medical, engineering, 
exercises, and other national and international programs.
    Seize control and defend key facilities or terrain to preclude 
actions by potential adversaries.
    Conduct expeditionary operations to deter, destroy, or defeat 
potential adversaries.
    Conduct extended campaigns to deter or prevent potential 
adversaries from engaging in protracted conflict with joint or U.S.-led 
coalitions of forces.
Preventing Acquisition of Weapons of Mass Destruction by State and Non-
        State Actors
    Conduct irregular or unconventional warfare in support of the Joint 
Force.
    Deny sanctuary and safe haven for terrorist groups.
    Assist the forces of other nations to conduct operations against 
adversaries seeking to possess or transfer control of weapons of mass 
destruction.

    While the problems we face will evolve, Soldiers' ``boots on the 
ground'' will remain vital to our solutions.

    Source: Strategic Problems drawn from 2006 Quadrennial Defense 
Review, Office of the Secretary of Defense, February 2006.

                                Figure 9

    ----------------------------------------------------------------

    The Army Plan is continuously improving our ability to operate as 
part of the Joint Team, while ensuring our ability to dominate in any 
environment against current, emerging, and unforeseen threats. We 
believe that every dollar spent to build capability for our current 
force is an investment in our future force. Our initiatives are guiding 
our efforts to:
  --Grow innovative, adaptive Soldiers and leaders through training and 
        education programs that build on recent combat experiences and 
        leverage the Training Transformation Program;
  --Adapt the doctrine which guides how we fight, how we sustain our 
        forces, and how we train Soldiers;
  --Create far more capable, strategically deployable brigades that are 
        designed to receive new technologies and equipment as soon as 
        they become available;
  --Increase Soldier and unit effectiveness and protection; and
  --Apply better business practices to free resources to use for our 
        most pressing operational requirements.
    Our ongoing intellectual and cultural transformation is 
dramatically improving how our leaders, Soldiers, civilian workforce, 
and families are adapting to the reality of protracted conflict. This 
transformation is reinforcing the commitment to continuous improvement 
that has taken hold across the Army.

  PROVIDE RELEVANT AND READY LANDPOWER FOR THE 21ST CENTURY SECURITY 
                              ENVIRONMENT

    To support current global operations and prevail in the war on 
terrorism, we are increasing the quality and the effectiveness of our 
essential fighting units, the Brigade Combat Teams (BCTs). We are 
forming a rotational pool of 70 BCTs that will allow us to sustain 
global commitments, surge forces for unforeseen contingencies, and 
reduce stress on Soldiers and equipment. We are also creating the right 
mix of Support Brigades to ensure that our Soldiers receive the 
logistical, engineering, intelligence, protection, aviation, and 
communications capabilities they will need to support the Combatant 
Commanders.
    We are rebalancing the force by placing the right Soldiers with the 
right skills into our jobs and organizations in greatest demand. At the 
same time, we are stabilizing Soldiers, to keep them with their units 
longer, to improve teamwork and reduce stress on families caused by 
frequent moves between posts. We are maintaining momentum in 
transforming and modernizing our formations--through modular 
conversion, pursuit of future combat systems, and fielding other 
advanced technologies. These complementary initiatives will ensure that 
our Soldiers are well prepared to operate in campaign and expeditionary 
settings with our joint and coalition partners.

Support Current Global Operations with Relevant and Ready Landpower
    To sustain a steadily increasing demand for military forces, we are 
building a modular force centered on BCTs. Our modular conversion 
across the active and reserve components is designed to meet the 
demands of the current war, sustain other global commitments, establish 
the organizational structure needed to accelerate modernization, and 
support a new global basing posture that will rely more heavily on 
rotational presence.
    Our plan will create a rotational pool of 70 BCTs: 42 in the active 
component and 28 in the Army National Guard. These BCTs will be 
organized into one of three standard designs: Infantry, Heavy, or 
Stryker. We will support these BCTs with more than 200 active and 
reserve Support Brigades. These Support Brigades will enable the BCTs 
to accomplish a broad range of missions. They will also provide 
essential capabilities to support civil authorities in homeland defense 
missions, including consequence management and disaster relief.
    Our Support Brigades are organized into two categories: Multi-
functional Support Brigades and Functional Support Brigades. The 
multifunctional brigades will perform operational roles including: 
Combat Aviation, Combat Support (Maneuver Enhancement), Sustainment, 
Fires, and Battlefield Surveillance. The functional brigades will 
perform broad support roles on a theater-wide basis including: Air 
Defense, Engineer, Explosive Ordnance Disposal, Military Police, 
Signal, and others.

    ----------------------------------------------------------------

                            Accomplishments
Since 9-11
    Soldiers helped to overthrow two terrorist regimes, rescue two 
nations from oppression, and to liberate over 50 million people.
    More than 144,000 Army Reserve Soldiers, 329,000 National Guard 
Soldiers, and 498,000 active component Soldiers supported Combatant 
Commanders in Iraq, Afghanistan, Guantanamo Bay, the Balkans, the 
Sinai, and elsewhere.
    120,000 National Guard Soldiers and 31,000 Army Reserve Soldiers, 
along with active component Soldiers, helped secure the homeland 
through key asset security, special events security such as the Super 
Bowl, airport security, and Air Force Base security augmentation.
    Began 37 of the 70 planned Brigade Combat Team modular conversions; 
18 of these 37 conversions completed.
    Doubled depot output in just three years to refurbish and reset 
vehicles and equipment for future deployments.
    Extended the life of more than 4,000 HMMWVs and 1,200 aircraft 
through the reset program.
2005
    Soldiers and coalition forces secured vital elections in Iraq and 
Afghanistan where millions voted.
    Two training divisions plus 4th Brigade Combat Teams worth of 
officer and noncommissioned officer leadership trained Iraqi and Afghan 
security forces.
    Soldiers trained and equipped 88,000 Iraqi Security Forces during 
2005, increasing their ranks to 224,000 in 136 battalions.
    Soldiers deployed to South Asia and Southwest Asia to provide 
tsunami and earthquake relief.
    More than 42,000 National Guard Soldiers; 7,300 active component 
Soldiers; and 3,500 Army civilians; complemented with Army Reserve 
aviation and transportation units, provided hurricane relief support 
(including Katrina and Rita).
    Deployed advanced systems to share information and improve 
situational understanding and command of forces for four divisions and 
three Brigade Combat Teams in Iraq and Afghanistan.
    Equipped most deploying units with the Joint Network Node to 
enhance command of forces.
    Advanced $2.2 billion contract for production of 368 Armed 
Reconnaissance Helicopters--the Army's first new manned helicopter 
acquisition since 1983.

    ----------------------------------------------------------------

    Like our theater commands, our corps and division level operational 
command posts and headquarters, Support Brigades will also be converted 
to modular designs. They will be trained, manned, and equipped to work 
directly for each of these headquarters without augmentation of people 
or equipment.
    We are also improving the readiness of our reserve forces that are 
making vital contributions on a daily basis--and have transitioned from 
a strategic to an operational reserve as our global commitments have 
increased. We are working to improve our access to these forces to 
support our strategic requirements. Access will be enabled by reducing 
reserve component overstructure and managing reserve Soldiers in ways 
that will improve assigned strength in each of our units, while 
increasing opportunities for education and special skills training. 
These improvements, coupled with modular conversion, will improve the 
Army's overall ability to provide ready forces and capabilities to the 
Combatant Commanders and to civil authorities in a timely manner.
    In addition, to make best use of our resources, we are both 
rebalancing and redistributing our forces. We are rebalancing to create 
the right mix of units in high demand, and Soldiers with critical and 
high demand skills in each of our active and reserve components. At the 
same time, we are redistributing Soldiers to create the right mix 
between our operational forces and our institutional structures.
  --To assure timely access to the right types of units and Soldiers, 
        we are rebalancing skills within our three components. We have 
        determined the types of units and skills that are in greatest 
        demand in today's environment--including infantry, engineer, 
        military police, military intelligence, Special Forces, 
        chemical, civil affairs, and psychological operations units--
        and have identified over 100,000 positions to rebalance. We 
        have accomplished more than half of this rebalancing and 
        project to be completed by 2011.
  --To sustain increased global commitments, we are also increasing, or 
        ``growing,'' the Operational Army in the active component. Our 
        goal is to grow the Operational Army by 40,000 Soldiers by 2008 
        (from the 2004 baseline of 315,000) to bring our active 
        component operational force total to 355,000 Soldiers. This 
        change will be enabled by military-to-civilian conversions and 
        better management of our Individuals Account.
    The combined effect of rebalancing, redistributing, and growing the 
Operational Army is increasing our overall effectiveness. We are 
improving our ability to provide trained Soldiers in cohesive 
formations to the Combatant Commanders and to support civil 
authorities, while reducing stress on Soldiers and families.
    To support global operations while transforming, we are preparing 
our forces for war--or resetting them--as quickly and efficiently as we 
can. Our reset program is restoring units returning from war to 
required levels of readiness to prepare them for future missions. As we 
reset our units, we are simultaneously converting them to their new 
modular designs. We have reset more than 20 major units. Many of these 
units have already returned to theaters of war in their new 
configurations.
    The Army Plan introduces a new readiness model, ARFORGEN, to manage 
the force and ensure the ability to support demands for Army forces. 
ARFORGEN sequences activities for all active and reserve Army units to 
include: Reset; Modular conversion; Modernization; Manning adjustments; 
Soldier and leader training and education programs; Unit training; 
Employment; and Stationing decisions.
    To sustain global commitments, we will transition units through a 
progression of three sequential readiness pools: Reset and Train, Ready 
(eligible for deployment and exercises), and Available (immediately 
available for world-wide employment). This model establishes a plan for 
scheduled deployment on an Army-wide basis. Through semi-annual 
synchronization conferences, we will organize our forces into three 
Expeditionary Force Packages: Ready Expeditionary Forces that are 
training and preparing for potential future missions; Contingency 
Expeditionary Forces that are ready for employment or exercises but not 
yet deployed; and Deployment Expeditionary Forces executing assigned 
missions.
    Our goal is to be able to generate a continuous output of trained 
and ready forces that will support one operational deployment in three 
years for the active component, and one operational deployment in six 
years for the reserve component. At lower levels of demand, this model 
may allow the Army to support one operational deployment in four years 
for active forces. This new model establishes the basis to bring all 
units to a full state of readiness--with people, equipment, and 
training--before they are scheduled to deploy. It allows the Army to 
accomplish the following critical objectives: Reduce uncertainty for 
Soldiers, families, and the communities that support installations; 
Improve availability of forces for Combatant Commanders; Generate a 
continuous force of 18-19 BCTs, along with all required Support 
Brigades; and Surge up to an additional 15-19 BCTs in response to 
crises.

Build a Campaign-Quality Modular Force with Joint and Expeditionary 
        Capabilities for Today and Tomorrow
    The war on terrorism and the changing paradigm for maintaining 
forward presence have created both the necessity and the opportunity to 
accelerate change from the current to the future force. Our conversion 
to a modular force--one that is carefully balanced between active and 
reserve component BCTs, Support Brigades, and division and corps level 
operational command posts--is well under way. This conversion is 
transforming the Army into a more lethal, flexible, deployable, and 
sustainable force. It is enabling us to shift the center of gravity of 
our capabilities (previously focused primarily on traditional 
challenges) to better address the full spectrum of traditional, 
irregular, disruptive, and catastrophic challenges.
    The combination of transformation to build a modular Army and 
continuous modernization, to field Future Combat Systems (FCS) and 
other advanced technologies, is methodically producing the future 
force.
    FCS is our primary modernization program and most critical 
investment. This program will pioneer the next generation of 
warfighting capabilities which will improve Soldiers' ability to find 
and fight their enemies. FCS includes a new class of manned and 
unmanned air and ground vehicles, interconnected by a modern network to 
better support and sustain Soldiers.
    The program is currently in the developmental phase. The first unit 
fully equipped with manned ground vehicles is projected to achieve 
initial capability by 2014 (and will be able to fight by 2017). When we 
complete our intended fielding plan in 2025, new manned ground vehicles 
will replace 40 to 50-year old tactical vehicles designed in the 1970s 
to defeat Cold War enemies.



    A significant contribution of FCS is that it will immediately place 
advanced technologies into the hands of our Soldiers that will increase 
their capability and provide greater protection. By integrating 
advanced technologies into our formations in four ``spin outs'' that 
will occur in roughly two-year increments, we will strengthen our 
current forces in distinct ways:
  --The first ``spin out,'' on track for delivery in 2008, will 
        introduce Unattended Ground Sensors, Non-Line-of-Sight Launch 
        Systems, the Intelligent Munitions System, and the Network. 
        These capabilities will enhance Soldiers' understanding of 
        their situation in dynamic, battlefield conditions by promoting 
        a common perspective of enemy and friendly locations on digital 
        maps. This improvement will greatly increase the area that 
        Soldiers can influence and control. The Network will also 
        provide Soldiers with more timely Actionable Intelligence.
  --The second and third ``spin outs,'' are currently on track for 2010 
        and 2012 respectively and will introduce new types of unmanned 
        aircraft systems and ground vehicles for our Soldiers. These 
        technologies will enable Soldiers to employ greater numbers of 
        sensors to see and find their enemies first. These ``spin 
        outs'' will also enable robotic reconnaissance of dangerous 
        areas, mines, and booby traps. Together, they will increase 
        Soldier protection and enhance the precision of their weapons.
  --The fourth ``spin out'' will complete the Network, currently on 
        track for 2014. When completed, this improvement will reinforce 
        the comprehensive efforts now under way to improve the accuracy 
        and responsiveness of the joint weapons systems designed to 
        support Soldiers.
    When whole BCTs are fielded with the full complement of FCS 
systems, these units will be able to generate significantly more 
capability. These FCS-equipped BCTs will contain more fighting vehicles 
and more infantry squads than the units we field today. They will be 
able to generate more capability and control more area with 
significantly fewer Soldiers than today. They will require less fuel, 
supplies, and other logistical support.
    These new capabilities will directly benefit all U.S. ground 
forces, including the Marine Corps and the Special Operations Forces 
from all Services. They will fundamentally alter how we deploy, employ, 
and sustain our ground forces. These capabilities will improve our 
capability to put ``boots on the ground,'' to stabilize contested 
zones, and to support joint and interagency teams.
    The future force comprises more than just FCS-equipped, modular 
BCTs. It includes all of the improvements in strategic agility and 
efficiencies that will result from implementing BRAC and IGPBS 
decisions. These decisions will enable the repositioning of forces to 
better respond to emerging challenges. We will also be able to execute 
much of our enduring overseas presence mission with units that deploy 
from the United States for overseas duty, during rotational windows 
scheduled and managed as part of the ARFORGEN model.
    For both rotational duties and for contingencies, our units will 
rely on pre-positioned equipment. To increase both strategic agility 
and efficiency, we are modernizing our pre-positioned equipment sets. 
We are also reducing the number of variants of our heavy combat vehicle 
fleet from four to two. This initiative will promote standardization, 
reduce the number of systems that we must train active and reserve 
Soldiers to operate, and reduce maintenance costs.

    ----------------------------------------------------------------

                            Compelling Needs

    Full funding of the Army request in the 2007 President's Budget, 
plus the requisite supplemental funding for combat operations to ensure 
Soldiers are fully trained and equipped in the most expeditious manner 
to enhance current force readiness and to achieve victory in the long 
war.
    Resource the Army's requirements for resetting over 50 brigades 
consisting of over 350,000 pieces of equipment including: 615 aircraft; 
7,000 combat vehicles; and 30,000 wheeled vehicles.
    Support the Army's effort in 2007 to grow our operational forces to 
355,000 Soldiers (increase of 40,000 Soldiers), and restructure both 
the Institutional and Operational Army across the active and reserve 
components to meet global commitments now and in the future.
    Fully fund continuous modernization of the current force through 
the Future Combat Systems Program and key supporting programs, 
including increasing Soldier protection, sustaining development of 
advanced technologies, developing the Joint Network Node, LandWarNet, 
and rebalancing active and reserve component units and skills to ensure 
the Army remains the preeminent landpower on earth.
    Sustain momentum in force transformation through modular 
conversions planned in 2007--three active component and seven reserve 
component Brigade Combat Teams, 13 active component and five reserve 
component supporting brigades, headquarters and support units--to 
ensure the Operational Army has relevant combat power for the 21st 
century.

    ----------------------------------------------------------------

    Our commitment to being a learning, adaptive organization is 
evident in our efforts to apply lessons learned from our operations 
both at home and abroad. We are working to develop a future force that 
is better able to fight as part of joint and coalition formations in 
either protracted campaigns or in expeditionary operations and to serve 
the Nation--by examining how to best accomplish traditional and 
nontraditional missions through five major areas of focus:
  --Sustain the Force enables modular Army logistics units to better 
        anticipate requirements and provide rapid and precise 
        capability to Army, joint, and multinational partners. We are 
        improving theater-wide distribution systems and visibility of 
        all of the assets and resources, both deployed and in-transit, 
        needed to support military operations.
  --Actionable Intelligence is providing Soldiers and leaders with 
        expanded situational understanding by distributing intelligence 
        with more speed and accuracy, while providing the means to 
        improve understanding of different languages and cultures.
  --Improve Capabilities for Stability Operations is improving our 
        understanding of how to stabilize areas of operation and 
        support security, transition, and reconstruction operations 
        while continuing to conduct combat operations.
  --Improve Contributions to Homeland Defense is focusing on balancing 
        capabilities in the Active and Reserve Components to ensure the 
        right capabilities are available to address expanded homeland 
        defense requirements and broadening the options available to 
        civil authorities.
  --Increase Army Capabilities to Dominate in Complex Environments is 
        focusing on finding innovative solutions to challenges posed by 
        operations in urban, mountainous, cavernous, and jungle 
        environments while expanding Soldier ability and protection, 
        and enhancing cultural awareness, regional familiarity, and 
        language skills.
    The combination of transformation and modernization, reinforced by 
initiatives of this type, and continued improvements in training 
Soldiers, developing leaders, and improving facilities is producing 
relevant and ready landpower for the 21st century.
    Supporting Initiatives (Addendum C): The areas of focus discussed 
above are reinforced by six initiatives: Develop Operational 
Capabilities in LandWarNet; Execute Major Acquisition Programs; 
Restructure Army Aviation; Enhance Joint Interdependence; Stabilize 
Soldiers and Units to Enhance Cohesion and Predictability; and Leverage 
Science and Technology.
train and equip soldiers to serve as warriors and grow adaptive leaders
    The Army Vision centers on producing Soldiers armed with the 
values, combat skills, and mindset that enable them to serve as 
competent, disciplined warriors who reflect our shared ethos. Our 
training programs, at our home stations, our Combat Training Centers, 
and across our institutional training base are leveraging our combat 
experiences to grow adaptive leaders who are highly skilled, resilient, 
able to thrive in rapidly changing environments, and ready to operate 
with our joint, interagency, and multinational partners. We are 
committed to continuing to equip our Soldiers with the best 
capabilities, weapons, and protection our Nation can provide--
leveraging our national strength to reduce risk to our Soldiers.
Reinforce our Centerpiece: Soldiers as Warriors
    Our Soldiers continue to serve magnificently as we enter the fourth 
year of the war on terrorism. They believe in their mission, the 
Soldier's Creed, and the Warrior Ethos. As evidenced by their service, 
they remain committed to something far bigger than themselves.
    In Iraq and Afghanistan, our Soldiers are consistently defeating 
the enemies of freedom.

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                            Accomplishments
Since 9-11
    Adapted Combat Training Center training scenarios to match expected 
threats and provided enhanced training challenges to develop adaptive 
leaders.
    More than half of the observer/controllers at our Combat Training 
Centers have experience in Iraq or Afghanistan.
    Greatly improved individual Soldier protection. Today every Soldier 
in Iraq and Afghanistan is issued improved body armor.
    Continued to meet Combatant Commander requirements to up-armor the 
vehicle fleet. To date, over 37,000 light, medium and heavy tactical 
wheeled vehicles have been fielded.
    Equipped 49 Brigade Combat Teams and nearly 500,000 Soldiers with 
state-of-the-art equipment through the Rapid Fielding Initiative.
2005
    Instituted the Combat Action Badge to recognize those Soldiers who 
directly engage or who are engaged by the enemy.
    Implemented standard 39 Warrior Tasks and Nine Battle Drills to 
initial military training for Soldiers of all military occupational 
specialties.
    Expanded training base capacity from 405,000 to 454,000 seats to 
enable growth in combat forces.
    Began implementation of new Officer Education System, including 
Basic Officer Leader Course and Intermediate Level Education.
    Used our experience gained in Iraq and Afghanistan to adapt our 
training bases and Combat Training Centers to provide enhanced training 
on marksmanship, fighting in urban areas, live fire convoy training, 
IED awareness, and working with non-English speaking allies.
    Increased ammunition production more than 400 percent to 1.5 
billion small arms rounds per year to adequately train Soldiers and 
meet operational needs.
    Participated in the Joint Task Force that developed technical 
solutions and provided critical training for ground forces to detect 
and defeat Improvised Explosive Devices.
    Began development of a new Civilian Education System.

    ----------------------------------------------------------------

    They have created the conditions to permit free, democratic 
elections and to reconstruct vital infrastructure and institutions. 
Like the American Soldiers of generations past, today's warriors are 
distinguishing themselves with tremendous acts of courage and valor in 
places such as Baghdad, Samarra, An Najaf, Fallujah, Tal Afar, Mosul, 
and Khandahar.
    Our Soldiers understand the Army's values and personify our ethos, 
demonstrated most poignantly by their willingness to sacrifice all so 
that others may live in peace and freedom. Our Nation must remain 
equally committed to them by providing the capabilities and support 
they need to succeed in their mission.
Train Soldiers
    Our continued commitment to innovative training and education led 
us to enhance the rigor and relevance of Initial Military Training for 
new enlisted Soldiers and officers. Today, every Soldier, regardless of 
specialty, becomes a warrior first. To be better prepared for combat, 
all recruits receive advanced training in marksmanship and livefire 
convoy procedures. Current training draws from recent combat experience 
and emphasizes 39 Warrior Tasks and Nine Battle Drills previously 
required only of infantry Soldiers.
    Our commitment to medical training and readiness has resulted in 
the highest survivability rate in military history. Every Soldier in 
combat carries a new blood-clotting bandage and a new onehanded 
tourniquet. Many are certified as combat lifesavers through extensive 
training. These capabilities combine with highly-trained combat medics, 
tremendous improvements in medical evacuation, and world-class field 
medicine to save lives every day.
    We are strong believers in life-long learning. We are using 
information technology to enhance Soldier and leader education in a 
time of war. Soldiers participate in more than 1,500 online courses to 
improve job proficiency and to work toward civilian degrees. Our Army 
Knowledge Online websites average more than one million visits per day, 
allowing Soldiers and leaders to collaborate and to share information 
regarding the lessons learned from combat and from training.
Enhance the Combat Training Centers
    Just as we have transformed individual Soldier training, our unit 
training has evolved to better reflect the complexity of modern 
battlefields. We have invested in our Combat Training Centers to 
replicate the complex environments--terrain, social, language, and 
culture--in which our Soldiers are fighting. Using these world-class 
training facilities, every unit conducts a Mission Rehearsal Exercise 
before deploying to combat. These exercises feature nongovernmental 
organizations, contractors, media, coalition role players, and hundreds 
of civilians on the battlefield. Similarly, our Battle Command Training 
Program uses state-of-the-art simulation techniques to replicate the 
realities of combat. This program trains deploying division, corps, and 
task force staffs who will serve as joint or coalition task force 
operational headquarters and includes information operations and other 
joint missions they might support or execute in the future.
    We are continuously improving training by providing a mix of live, 
virtual, and constructive training events. This cost-effective 
approach, which uses state-of-the-art simulation tools, improves 
Soldier and unit capabilities and links home station training to the 
joint team. The rigor that we are adding to our Soldier, unit, and 
joint-level training, is reducing risk for our Soldiers by improving 
our predeployment preparation.

Grow Adaptive Leaders
    The complexity of the 21st century security environment requires 
more of Army leaders at all levels. As we have seen in Iraq, 
Afghanistan, Korea, Europe, across the Americas, and in peace 
enforcement operations around the world, the actions of individual 
Soldiers and leaders can have strategic consequences. To be effective 
today and tomorrow, we are growing a new breed of leader--one more akin 
to a pentathlete who is able to rapidly transition between complex 
tasks with relative ease.
    The future environment will demand that Army leaders at all levels 
be multi-skilled, innovative, agile, and versatile. Therefore, we are 
continuing to evolve our training and education systems to grow 
adaptive civilian and military leaders who are comfortable in leading 
during times of change and uncertainty.



    Recognizing that intellectual change precedes physical change, we 
chartered a task force to Review Education, Training and Assignments 
for Leaders. This task force, now six months under way, is drawing upon 
the ideas and experiences of the finest leaders inside and outside of 
the Army. The task force will recommend changes to assess and improve 
all Army education, training, and assignment processes to produce 
pentathletes.
    Unlike World War I and World War II, when the Army closed the Army 
War College, we have improved our leader education programs while at 
war. At the Army War College and in all of our schools, training 
centers, and doctrine development positions, we are placing recently 
returned veterans into key positions to enhance the relevance of the 
education and training we provide. We are also moving to fully 
implement a new Basic Officer Leader Course (BOLC). Consistent with our 
warrior first approach, this tough, standardized, small-unit leadership 
experience is ensuring that all junior officers, in all of our 
branches, master the skills they will need to lead in combat. We are 
executing similar improvements in all of our officer and 
noncommissioned officer education programs. Our civilian development 
program is enhanced through our Civilian Education System.

Equip Our Soldiers
    Protecting our Soldiers continues to be our highest priority. With 
great support from the Congress, the Department of Defense, and the 
President, we have delivered more than 37,000 up-armored vehicles to 
meet Combatant Commander requirements. Additionally, we continue to 
contribute to the Joint Organization established to defeat our 
adversaries' use of improvised explosive devices. (Figure 10)



    We are also exploiting the value of the Rapid Equipping Force (REF) 
to better protect our Soldiers. REF works in partnership with industry, 
academic, and military leaders to support Soldier needs as quickly as 
possible. It provides field commanders with readily employable 
solutions to enhance lethality and survivability. Often using off-the-
shelf and developmental technologies, REF is enabling us to remain 
ahead of an adaptive enemy and to save Soldiers' lives. Examples of 
last year's successes include the deployment of digital translators, 
vehicle scanning systems, and robots able to inspect possible 
improvised explosive devices.
    A similar program to increase Soldier capabilities is the Rapid 
Fielding Initiative (RFI). RFI has equipped nearly 500,000 Soldiers 
since its inception. RFI accelerates the fielding of commercial, off-
the-shelf systems to produce state-of-the-art capabilities. RFI 
provides a specific set of equipment to every Soldier, and a set of 
additional items to Soldiers assigned to BCTs. The Training and 
Doctrine Command is using combat lessons learned to maintain the 
currency of the items we supply. We plan to complete fielding these 
items to all operational forces by September 2007.

    ----------------------------------------------------------------

                            Compelling Needs
    Support and funding to implement the findings of the Review of 
Education, Training, and Assignments for Leaders, examining all 
pertinent policies and programs with a view to creating military and 
civilian ``pentathletes'' able to lead effectively amidst the 
complexity and uncertainty of the 21st century security environment.
    Continue to support Army initiatives to sustain Soldier, leader, 
and unit training development and provide stability for Soldiers and 
their families.
    Continue to support the Rapid Fielding Initiative to complete the 
goal of equipping all operational forces (active and reserve component) 
by September 2007.
    Maintain funding support for equipment modernization programs that 
speed state-of-the-art force protection systems and weapons to our 
Soldiers in the field.

    ----------------------------------------------------------------

    Supporting Initiatives (Addendum C): The areas of focus described 
above are reinforced by three supporting initiatives: Support Joint 
Improvised Explosive Device Defeat Organization (JIEDDO); Expand 
Cultural Awareness and Language Capabilities; and Develop Joint 
Training Capabilities.

 SUSTAIN AN ALL-VOLUNTEER FORCE COMPOSED OF HIGHLY COMPETENT SOLDIERS 
           THAT ARE PROVIDED AN EQUALLY HIGH QUALITY OF LIFE

    We owe our success to the versatile young Americans who answer the 
Call to Duty. This is the first time in our modern history that the 
Nation has tested the concept of an All-Volunteer force during a 
prolonged war. We are executing a full range of initiatives and 
incentives to recruit and retain high caliber citizens to man our 
active, reserve and civilian ranks. Caring for Soldiers and Army 
families through tangible quality of life programs provides a sense of 
belonging and sustains motivation for continued service. Improving 
Soldier and family housing reflects our commitment to providing a 
quality of life that matches the quality of our Soldiers' service to 
the Nation.

Recruit and Retain the All-Volunteer Force
    We have maintained our All-Volunteer Army by recruiting dedicated, 
high-quality Soldiers and then retaining them well beyond their initial 
obligations. While the recruiting environment for America's young men 
and women is competitive, we will not compromise standards as we 
temporarily increase the size of the Army by 30,000 Soldiers. Our 
recruiting goal this year exceeds 186,000 Soldiers for all three 
components. This annual goal compares to about 140,000 recruits for all 
of the other Services combined.

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                            Accomplishments
Since 9-11
    Exceeded combined active and reserve retention goal each year.
    Built over 24,000 barracks spaces and modernized over 9,000 
existing spaces through the Barracks Modernization Program.
    Privatized 59,500 sets of quarters at 26 different installations 
through the Residential Communities Initiative to improve family 
housing.
    Continued to state-of-the-art health care as they return from 
theater.
    Established a Well-Being framework to integrate, resource, and 
measure quality-of-life programs for Soldiers and families.
2005
    Achieved 106 percent of the combined active and reserve retention 
goal.
    Increased recruiting and retention incentives programs.
    Assisted Family Support and Readiness Groups from company to 
division-level. Developed Virtual Family Readiness Groups.
    Implemented the U.S. Army Wounded Warrior Program (formerly 
Disabled Soldier Support System) to synchronize Army programs that care 
for severely disabled Soldiers.
    Established a community-based Child and Youth Services Program for 
child care, youth development, and school transition to support 160,000 
Army Reserve youths.
    Implemented a $250 million Barracks Improvement Program to upgrade 
substandard Soldier barracks.

    ----------------------------------------------------------------

    Last year was a challenging recruiting year. However, we finished 
strongly, exceeding the monthly goals for the last four months by more 
than 400 Soldiers per month in the active component. This trend 
continued into the new recruiting year in all three components. To 
achieve success this year, we have expanded advertising, increased the 
number of recruiters, and augmented numerous incentive programs. We 
recently initiated a new program, Unity of Effort, to recruit former 
members of the Armed Forces. This program features enlistment bonuses 
and, in many cases, reinstatement of previous rank. We are optimistic 
that our efforts, reinforced by Congress and the Nation's support, will 
result in meeting our recruiting goals for this year.
    The Army is retaining Soldiers at tremendously high levels. Since 
2002, while fighting the war on terrorism, we have surpassed our 
combined Army retention goals each year. In 2005, we exceeded our goal 
by more than six percent. We reenlist two out of every three eligible 
Soldiers who reach the end of their term of service during a given 
year. We are particularly proud that one out of every two first-term 
Soldiers decide to reenlist. In a time of war and a high operational 
pace, we believe this achievement is indicative of the high quality of 
leadership that our Soldiers experience in their units. Our Soldiers 
value the tradition of service to the Nation and appreciate the 
opportunity to contribute in a meaningful way.
    The continued support of spouses, parents, veterans, and the 
employers of our reserve component Soldiers plays a huge role in 
recruiting and retaining the All-Volunteer force. This support has a 
direct effect on the pride and morale of each of our Soldiers. In May 
2005, to recognize the role and contributions of key influencers in our 
society, we established the Freedom Team Salute Program. To date, we 
have received requests to commend almost one million spouses, parents, 
veterans, and civilian employers.

Care for Soldiers and Army Families
    We continue to work to assure Soldiers and their families that they 
will be taken care of and all their needs will be met. Caring for 
families plays a vital role in sustaining a national commitment to 
serve and requires both the attention of leaders and the application of 
resources.
    Army Well-Being programs provide leaders a variety of ways to care 
for Soldiers and their families. We have integrated numerous quality-
of-life functions into a comprehensive well-being framework that 
enables us to focus resources, measure success, and address the needs 
of an Army at war. Our objective is to sustain the fighting strength of 
our Army while providing for the individual needs of Soldiers and 
families.
    To assist Family Support and Readiness Groups at all levels, we 
have developed Virtual Family Readiness Groups. We have expanded child 
care programs on installations and in communities that have deployed 
Army National Guard and Army Reserve units. The Army Reserve 
established a Child and Youth Services Program to facilitate access to 
child care, youth development, and student support. The new Deployment 
Cycle Support Program helps families to understand and cope with the 
stress of deployments. Our Army Spouse Employment Partnership program 
has placed over 11,000 spouses in positions with major corporations and 
State and Federal agencies. We are currently working on a school 
transition program to help families and communities affected by BRAC 
decisions. These are just a few of the many ways that we care for 
Soldiers and families.
    Health care is another critical aspect of caring for our Soldiers 
and their families. The Army provides world-class health care for 3.5 
million beneficiaries, on the battlefield and at hospitals and clinics 
worldwide. To honor our obligation to care for Soldiers and families, 
we continually look for ways to improve health and well-being. The U.S. 
Army Wounded Warrior Program, formerly known as the Disabled Soldier 
Support System, provides sustained care for our severely wounded 
Soldiers. This program provides continuous and comprehensive transition 
and support services for our Soldiers until they are returned to duty 
or for up to five years after medical retirement. This program 
exemplifies our commitment to honor the Soldier's Creed by ``never 
leaving a fallen comrade.''

Improve Soldier and Family Housing
    We are committed to providing quality housing for our Soldiers. 
Housing for single and married Soldiers has been improved significantly 
as a result of the Barracks Modernization Program and Residential 
Communities Initiative (RCI).
    To improve substandard living conditions across our installations, 
we committed $250 million to an immediate Barracks Improvement Program. 
As part of a longer-term Barracks Modernization Program, we will have 
funded 85 percent of our barracks modernization by the end of this 
year. We have programmed funding through 2009 to modernize our 
remaining barracks spaces. In addition, 45 percent of barracks for our 
recruits at our training centers will be modernized by 2011. Using 
vital supplemental funding, we also initiated a program to modernize 
the barracks used by Army Reserve and Army National Guard Soldiers 
during their annual training.
    Through RCI, we are providing better family housing for our 
Soldiers by privatizing 82,000 homes at 42 installations. This program 
leverages private investment capital to improve housing at a much 
faster rate than traditional methods of financing and contracting for 
military construction. When completed in 2010, over 90 percent of Army 
housing in the United States will have been privatized. We have also 
constructed more than 3,600 family homes and renovated 6,300 existing 
homes using traditional military construction.
    Improved housing, in barracks and quarters, provides Soldiers and 
families with a quality of life that recognizes their service to the 
Nation. These programs have a positive, enduring effect on Soldiers' 
morale, and contribute immeasurably to our ability to sustain our 
volunteer force.
    Supporting Initiatives (Addendum C): The above areas of focus are 
reinforced by the following three supporting initiatives: Continue Army 
One Source; Establish Multi-Component Family Network; and Execute Child 
and Youth Services School Transition Support.

    ----------------------------------------------------------------

                            Compelling Needs
    Support and funding to achieve critical recruiting and retention 
goals. Meeting these goals for all components will ensure the quality 
of our All-Volunteer force.
  --Achieve an active component recruiting goal of 80,000 and retention 
        goal of 64,200; an Army National Guard recruiting goal of 
        70,000 and retention goal of 34,900; and an Army Reserve 
        recruiting goal of 36,500 and retention goal of 16,900.
  --Continue support of Army initiatives to provide predictability and 
        stability for Soldiers and their families in both the active 
        and reserve components.
  --Full funding and support for quality-of-life programs to sustain 
        the All-Volunteer force, now being tested for the first time in 
        a prolonged war.
  --Support housing initiatives to provide quality housing for Soldiers 
        and families at installations impacted by Base Realignment and 
        Closure and the Integrated Global Presence and Basing Strategy.

    ----------------------------------------------------------------

 PROVIDE INFRASTRUCTURE AND SUPPORT TO ENABLE THE FORCE TO FULFILL ITS 
                      STRATEGIC ROLES AND MISSIONS

    The infrastructure that the Army maintains plays a vital role in 
supporting the Joint Force. We are adjusting our global footprint to 
improve readiness at each of our installations. To free resources for 
more compelling operational needs, we are reengineering every one of 
our business processes. At the same time, we are completely 
transforming our infrastructure, consisting of installations, depots, 
and arsenals--and the information network that connects them--to 
reflect the deployment requirements and global commitments of the 21st 
century security environment, while becoming dramatically more 
efficient.

    ----------------------------------------------------------------

                            Accomplishments
Since 9-11
    Created the Installation Management Agency to unify the business 
structure of Army installations and to create uniformly high standards 
of quality for Soldiers and their families.
    Developed a strategic stationing plan that synchronizes decisions 
of Base Realignment and Closure, Integrated Global Presence and Basing 
Strategy, Army Modular Force initiative, and the demands and realities 
of the Global War on Terrorism.
    Optimized Power Projection Platforms to mobilize and deploy over 
500,000 Soldiers to support the Global War on Terrorism.
2005 \1\
    Awarded the General Fund Enterprise Business System contract to 
enhance the management of financial resources.
    Planned and implemented an Army-wide Business Transformation 
initiative based on the Lean Six Sigma methodology to reduce the cost 
of the business side of the Army.
    Identified and began initial implementation of substantial 
structural changes to the institutional base of the Army.
    Implemented a strategic management system to measure Army 
performance and ensure optimum allocation of resources.

    \1\ Several continue into 2006.

    ----------------------------------------------------------------

Adjust Global Footprint to Create ``Flagships of Readiness''
    The Army is moving units and transforming posts through an effort 
that we call ``Stationing.'' In 2007, we will reposition major elements 
of our operational force (Figure 11). At the same time, we will 
establish the environmental foundation and initiate the renovation and 
construction needed to reposition schoolhouses, headquarters, and other 
support activities. Our stationing effort will posture our forces, 
logistics activities, and power projection infrastructure to respond to 
the demands of a complex, uncertain future as efficiently and 
effectively as possible.
    We have produced a plan that integrates BRAC decisions, the IGPBS 
plan, and the Modular Force initiative. This plan allows us to divest 
Cold War era infrastructure and create the infrastructure required for 
the foreseeable future. We are consolidating activities by leveraging 
information technology and advances in supply chain management. We are 
also completely reengineering our business processes to eliminate 
waste.
    This consolidation will yield tremendous savings over time. Our 
plan reduces overhead costs by streamlining the installation staffs, 
contract support, and infrastructure that will support units and 
activities at their new locations. We are exploiting this opportunity 
to become more efficient and more effective as we implement our 
stationing plan.
    Stationing involves more than merely opening, closing, or 
realigning functions. It requires balancing military, economic, and 
strategic necessities to determine the scope and timing of closures, 
consolidations, construction, renovation, unit activations, and unit 
deactivations. We have scheduled all of these activities to occur in 
ways that will enhance the flow of forces to and from current global 
commitments.

    ----------------------------------------------------------------

                     Major Stationing Moves in 2007
    1st Brigade, 1st Armored Division moves from Germany to Fort Bliss.
    212th Fires Brigade moves from Fort Sill to Fort Bliss.
    17th Fires Brigade moves from Fort Sill to Fort Lewis.
    Stryker Brigade Combat Team 7 activates at Fort Lewis.
    Battlefield Surveillance Brigades activate at Fort Hood and at Fort 
Bragg.
    Support Brigades (Maneuver Enhancement) activate at Fort Irwin and 
Fort Polk.

                               Figure 11

    ----------------------------------------------------------------

    Our stationing plan and requirements for funding, construction, 
renovation, and environmental remediation are guided by a set of key 
goals: Use existing infrastructure to reduce cost and excess capacity; 
Minimize use of temporary facilities; and Place priority on barracks, 
housing, motor pools, ranges, and training facilities to ensure that 
our Soldiers are properly prepared for the challenges they will face.
    While positioning the Army to better respond to the 21st century 
security environment, we are simultaneously working to ensure that our 
Soldiers and families enjoy the benefits of installations that are 
truly ``Flagships of Readiness.''
    The quality of our installations remains critical to accomplishing 
our mission. Our depots, training bases, and home stations enable the 
Army to: Build, train, deploy, and sustain our operational forces; 
Reset and regenerate combat power of returning forces for future 
missions; Provide homes, health care, essential support, and much of 
the quality of life that our Soldiers and families enjoy; and Provide 
the workplace for our civilian workforce of more than 230,000 people 
that is performing an increasingly important role in accomplishing the 
Army's wartime mission.
    Since 2001, the Army has made tremendous progress in enhancing 
training and generating combat power in time of war. Despite 
improvements, the Army still requires significant resources to overcome 
years of insufficient investments in its installations and 
infrastructure. We are committed to reducing our facilities 
recapitalization rate to meet the Department of Defense 67-year goal. 
If resourced, our stationing plan will produce installations better 
able to train and prepare our forces for future missions. Our plan will 
also provide a quality of life that our Soldiers and families deserve, 
and help to sustain the All-Volunteer force.
Implement Business Transformation Initiatives
    We are fundamentally changing how the Army conducts business. Our 
goal is to streamline or eliminate redundant operations to free 
financial and human resources to redirect to our core warfighting 
missions. We are: Improving our processes to repair equipment and reset 
our forces; Reengineering our manufacturing and administrative 
processes; Outsourcing, where it makes sense; Seeking to make best use 
of economies of scale in all of our contracted services; Applying 
information technology to improve support and eliminate functions where 
possible; and Achieving cost savings in software and hardware while 
pursuing enterprise-level solutions in our networking practices.

    ----------------------------------------------------------------

                            Compelling Needs
    Support to execute a carefully synchronized plan to achieve a new 
global basing posture while fulfilling the requirements of the National 
Military Strategy. The requirements of this plan (for renovation, 
construction, environmental remediation and other costs) will exceed 
the resources currently apportioned for base realignment and projected 
to be recouped through consolidation and closure.
  --Support Army efforts to synchronize Integrated Global Presence and 
        Basing Strategy, Base Realignment and Closure, and stationing 
        of modular units.
  --Support funding to achieve a 67-year facilities recapitalization 
        rate.
  --Maintain support for 2007 military construction requirements in 
        accordance with the Army Modular Force initiative, Base 
        Realignment and Closure, Integrated Global Presence and Basing 
        Strategy, and other Department of Defense guidance.
    Support for funding and authorities for Army Business 
Transformation initiatives to achieve targeted efficiencies through 
management reform, Institutional Army adaptation, and reengineered 
business practices. These initiatives will free human and financial 
resources for more compelling operational needs.

    ----------------------------------------------------------------

    Across the Army, we are reengineering all of our business processes 
to achieve greater efficiency, improve quality, decrease cycle time, 
and reduce cost. The method we are using, Lean Six Sigma, has already 
produced a marked improvement in manufacturing and repair processes at 
all of our depots within the Army Materiel Command. Once fully 
implemented across the Army, with full adherence to labor laws and 
other administrative requirements, we will replicate these successes 
across the Army in all our activities.
Develop the LandWarNet Institutional Infrastructure
    We are investing in information technology at our installations and 
reserve component facilities to lay the foundation for fielding 
LandWarNet. The Army's portion of the Global Information Grid, 
LandWarNet compromises both infrastructure and services. It moves 
information through a seamless network to better support our combat 
forces and the institutional structures that generate them. Our 
information technology infrastructure will enable operational forces to 
``reach back'' for data, such as repair part visibility, intelligence 
and other support, and innovations such as telemedicine. This same 
technology is improving our ability to manage business.
    Supporting Initiatives (Addendum C): The areas of focus discussed 
above are reinforced by three supporting initiatives: Execute Base 
Realignment and Closure; Improve Global Force Posture; and Improve 
Medical Infrastructure.
     balancing risk: the tension between current and future demands
    The Army has always experienced a tension between current and 
future demands, perhaps more now than ever before. Consistent 
investment in current and future readiness is needed to: Ensure that 
the size and mix of our components and capabilities are in balance; 
Enhance our global posture, agility, and readiness to conduct 
expeditionary operations on short-notice; and Organize, man, train, and 
equip our Soldiers to win today and tomorrow.
Meeting Today's Demands While Preparing for Tomorrow
    The Army has adapted to fight the war on terrorism following a 
decade of insufficient modernization investments. At the start of 
combat operations, many of our units were under-equipped and not 
immediately ready for deployment, especially in our reserve components.
    To meet Combatant Commander requirements, we had to aggregate 
equipment from across the force to fully equip those Soldiers deploying 
into harm's way. As a result, we significantly reduced the readiness of 
many units to prepare others for combat.
    This readiness decision was especially evident in the Army National 
Guard during our national response to hurricanes Katrina and Rita. With 
help from the President, the Congress, and the Department of Defense 
via supplemental appropriations, we have been provided the means to 
address many of our equipment shortfalls and readiness requirements, 
yet we still have much to accomplish.

    ----------------------------------------------------------------

                 Army Actions to Mitigate Risk in 2005
Operational Risk
    Funded our reset program to repair over 7,000 tracked and wheeled 
vehicles and over 550 helicopters;
    Completed the modular conversion of 11 Brigade Combat Teams, 
including one Stryker brigade that will deploy this year; and
    Implemented the ARFORGEN model to allow the Army to sustain a 
commitment of up to 18-19 Brigade Combat Teams with the ability to 
surge an additional 15-19 Brigade Combat Teams on short notice.
Future Challenges Risk
    All tactical vehicles in Iraq and Afghanistan that operate away 
from forward operating bases have up-armored or add-on armor 
protection. Nearly 2,400 tactical wheeled vehicles do not have missions 
off of forward operating bases and are not armored; and
    Restructured the Future Combat Systems program to ``spin out'' 
advanced technologies to Soldiers as they become available, rather than 
waiting for total system fielding.
Force Management Risk
    Continued modular force conversions, enlarging the pool of 
available units to reduce the stress on the force;
    Continued military-to-civilian conversion to free up Soldier 
positions from the Institutional Army to the Operational Army;
    As a component of the ARFORGEN, initiated lifecycle management of 
11 Brigade Combat Teams to keep Soldiers in units longer, improve unit 
readiness and cohesion, and provide greater predictability for Soldiers 
and their families; and
    Created a stationing plan to better posture the force for 
deployments and other global commitments.
Institutional Risk
    Implemented business transformation initiatives to improve how the 
Army does business and consequently reduce cost;
    Awarded the General Fund Enterprise Business System contract to 
allow better financial management;
    Created a stationing plan to improve strategic responsiveness and 
invest in our most critical installations; and
    Invested in LandWarNet to improve each installation's ability to 
manage information and better support operational forces.

    ----------------------------------------------------------------

    To manage risk within acceptable levels during wartime, the Army 
requires:
  --Full funding of the Army request in the 2007 President's Budget and 
        special consideration, in light of wartime demands, for 
        avoiding any reductions to the Army's budget and program. In 
        addition, supplemental funding is required for combat and 
        contingency operations and to continue to reset, repair, 
        recapitalize, and replace battle losses of equipment for 
        several years beyond major deployments. Supplemental funding is 
        needed to overcome the stress on equipment resulting from 
        sustained combat operations in harsh environments. These 
        resources will ensure that the Army is fully manned, trained, 
        and equipped to achieve victory in the war on terrorism. These 
        resources will also enable the Army to maintain the momentum of 
        key programs, while accelerating transformation.
  --Funding to increase Army capabilities and overall capacity as well 
        as support for the legislative authorities and programs needed 
        to assure access to our reserve components--who, by necessity, 
        have become an operational vice a strategic reserve. We must 
        achieve a proper balance of capabilities and skills among our 
        active and reserve forces and continue to build high-quality 
        units to increase capability and ease the strain on our 
        deployed Soldiers.
  --Support and funding to achieve critical recruiting and retention 
        goals needed to grow our operational forces. Meeting these 
        goals for our active and reserve Soldiers sustains the quality 
        and effectiveness of our All-Volunteer force.
  --Funding for the FCS program--to enhance current force capabilities 
        today with ``spin outs'' of available technology--and 
        accelerate more than 300 other modernization programs. Our most 
        critical investment program, FCS will be the Army's first major 
        modernization in over 30 years and will better prepare and 
        protect Soldiers for current and future threats. These 
        capabilities will directly benefit our active and reserve 
        components, all U.S. ground forces, and our allies that support 
        ground campaigns.
  --Full funding to maintain momentum in building a rotational pool of 
        70 BCTs and more than 200 modular Support Brigades and 
        headquarters. Already well under way, our transformation to 
        become a fully modular force is preparing our Soldiers to 
        conduct sustained operations of the type we see today. In 
        addition, our transformation is increasing the depth and 
        breadth of our capabilities to prepare our Soldiers for 
        tomorrow's challenges, particularly as we evolve to maintain 
        overseas presence with rotational units.
  --Full funding for Army installations and support to execute a 
        carefully synchronized plan to achieve a new global basing 
        posture, while fulfilling the requirements of the National 
        Military Strategy. This plan will make full use of the 
        resources currently apportioned and projected to be recouped 
        through consolidation and closings. Unanticipated costs 
        associated with environmental remediation, renovation, 
        construction, and other areas, may require additional resources 
        in future years (a situation that will require continuous 
        reevaluation). Full funding and continued support for Army 
        installations and quality-of-life programs is required to 
        sustain the All-Volunteer force, now being tested for the first 
        time in a prolonged war.
  --Support for funding and authorities for Army Business 
        Transformation initiatives to achieve targeted efficiencies 
        through management reform, Institutional Army adaptation and 
        reengineered business practices. These initiatives will free 
        human and financial resources for more compelling operational 
        needs and accelerate other aspects of our transformation.
    The Army is committed to producing units that are ready for the 
challenges they will face tomorrow and to overcoming years of 
underfunding prior to the events of 9-11. We have received 
unprecedented support to ``buy back'' much needed capability. We 
cannot, however, fool ourselves by maintaining large numbers of forces 
on paper that, in reality, lack the people, equipment, training, and 
support needed to accomplish the missions they will be assigned. We are 
determined to support our Soldiers and their families with an improved 
quality of life that matches the quality of the service they perform 
for America.
    Building the capabilities required to hedge against the uncertainty 
of tomorrow will require prudent investments today. These investments 
must be sustained at predictable, consistent levels over time--a 
departure from historic patterns of spending which have increased our 
Nation's vulnerability at the outset of each of the major conflicts of 
the 20th century. As George Washington stated, ``To be prepared for war 
is one of the most effective means of preserving peace.'' Consistency 
in funding, even as the war on terrorism ebbs and flows, is absolutely 
essential to the Army's ability to preserve peace and freedom for the 
Nation.
              preserving peace and freedom for the nation
    Guided by the Army Vision, we are accomplishing our mission today 
while building the future force--of Soldiers, leaders, modular forces 
and institutional support structures--to do so tomorrow.
    We remain resolute in our determination to preserve peace and 
freedom for America. To identify, learn, and adapt to new challenges, 
we continue to focus on tough questions that will remain at the center 
of the defense debate:
  --What are the strategic requirements of the 21st century? What 
        decisions must we make now to fulfill our Title 10 obligation 
        to ensure the Army, as part of the Nation's Armed Forces, is 
        best prepared to defend U.S. interests in the face of 
        traditional, irregular, catastrophic and disruptive challenges?
  --How can we best prepare our leaders to become multi-skilled 
        ``pentathletes'' able to operate confidently and successfully 
        amidst the challenges and uncertainties we will face?
  --Are joint land forces (Army, Marines, and Special Operations 
        Forces) properly sized, structured, trained, and oriented to 
        provide the capabilities needed to perform the missions that 
        the Nation will require?
  --What additional actions are required to ensure that our forces are 
        organized, trained, manned, and equipped to be relevant to, and 
        ready for, the challenges they will face?
  --How do we ensure that our physical infrastructure (installations, 
        depots, arsenals, and the network that connects them) best 
        support our mission? How do we balance our resources to: 
        Provide quality of life to sustain our volunteer force; 
        maintain deployment facilities (air, ground, sea, rail, cargo, 
        and other facilities) to support Combatant Commanders' 
        timelines; and establish a training base to prepare our 
        Soldiers and units for the challenges they will face?
  --How can we best leverage the human and financial resources we have 
        been provided to ensure that we remain the world's preeminent 
        landpower--ready to meet and relevant to, in capabilities and 
        mindset, the challenges we will face?
  --What will be the impact of protracted conflict on the All-Volunteer 
        force? What combination of quality of life, compensation, 
        incentives, service options, and other tools will be required 
        to recruit, retain, and sustain the concept of the All-
        Volunteer force for the future?
    With the support of the President, the Congress, and the Department 
of Defense, we are developing the capabilities and the capacity to 
sustain our global commitments and to prevail in the war on terrorism. 
We need your continued support to meet the needs of the Combatant 
Commanders and our Soldiers, who answer the Call to Duty by 
volunteering to serve the Nation in this time of war.
                                Acronyms
    AC--Active Component
    ARFORGEN--Army Force Generation
    ARNG--Army National Guard
    ASEP--Army Spouse Employment Partnership
    AW2--U.S. Army Wounded Warrior Program
    BCT--Brigade Combat Team
    BOLC--Basic Officer Leader Course
    BRAC--Base Realignment and Closure
    CBRNE--Chemical, Biological, Radiological, Nuclear and High Yield 
Explosives
    CTC--Combat Training Center
    DOD--Department of Defense
    FCS--Future Combat Systems
    FTS--Full Time Support
    FY--Fiscal Year
    GBIAD--Ground Based Integrated Air Defense
    GDP--Gross Domestic Product
    HMMWV--High Mobility Multipurpose Wheeled Vehicle
    IED--Improvised Explosive Device
    IGPBS--Integrated Global Presence and Basing Strategy
    JIEDDO--Joint Improvised Explosive Device Defeat Organization
    JTF--Joint Task Force
    MFO--Multinational Force and Observers
    NDAA--National Defense Authorization Act
    OEF--Operation Enduring Freedom
    OIF--Operation Iraqi Freedom
    O&M--Operations and Maintenance
    QDR--Quadrennial Defense Review
    RC--Reserve Component
    RCI--Residential Communities Initiative
    RDA--Research, Development, and Acquisition
    REF--Rapid Equipping Force
    RFI--Rapid Fielding Initiative
    SAPI--Small Arms Protective Inserts
    SBCT--Stryker Brigade Combat Team
    TOA--Total Obligation Authority
    UAS--Unmanned Aerial Systems
    USAR--United States Army Reserve
    WMD--Weapons of Mass Destruction
                   Addendum I (Helpful Army Websites)
    The following websites provide greater information on various 
topics:
    The Army Website: This site is the most visited military website in 
the world, averaging about 7 million visitors per month or 250 hits per 
second. It provides news, features, imagery, and references.
        http://www.army.mil
    The Army National Guard: Provides information about the Army 
National Guard.
        http://www.arng.army.mil
    The United States Army Reserve: Provides information about the Army 
Reserve.
        http://www.armyreserve.army.mil/usar/home
    Army Families Online: This site provides information and links to 
other support programs that support our Soldiers and their families.
        http://www.armyfamiliesonline.org
    Wounded Warrior Program: This site provides information on the 
Army's Wounded Warrior Program which provides support for severely 
wounded Soldiers and their families. It can be found through the Army 
Families Online website at
        http://www.armyfamiliesonline.org
    Deputy Chief of Staff for Personnel, G-1: For information on 
personnel issues.
        http://www.armyg1.army.mil
    Deputy Chief of Staff for Logistics, G-4: For information on Army 
logistics.
        http://www.hqda.army.mil/logweb
    Chief Information Officer, G-6: For information on Army Information 
Management.
        http://www.army.mil/ciog6
    Deputy Chief of Staff for Programs, G-8: For information on 
materiel integration.
        http://www.g8.army.mil
    Future Combat Systems: For information on the Future Combat Systems 
program.
        http://www.army.mil/fcs
    Army Logistics Transformation Agency: For information on Army 
logistics transformation.
        http://www.lta.army.mil
    Army Medicine: For information on Army medical programs.
        http://www.armymedicine.army.mil
    Army Posture Statement: For the web-based version of this year's 
Army Posture Statement and previous years versions.
        http://www.army.mil/aps
    Army Modernization Plan: Provides a detailed overview of the Army's 
organizational and materiel modernization efforts.
        http://www.army.mil/features/MODPlan/2005
       Addendum J: Additional Information on Army Related Topics
    We have provided additional information on the following topics in 
the CD-ROM and web-based versions of the 2006 Army Posture Statement. 
They are available as in-text links and may be accessed through this 
addendum either on the CD-ROM or the Web.

    Actionable Intelligence
    Active Component/Reserve Component Rebalance
    Adapting the Major Army Command Structure
    Add-on Armor for Tactical Wheeled Vehicles
    Army Barracks Modernization Program
    Army Capabilities to Dominate in Complex Environments
    Army Career Intern Program
    Army Community Service
    Army Energy Strategy for Installations
    Army Environmental Programs
    Army One Source
    Army Prepositioned Stocks
    Army Reserve
  --All-Volunteer Force and the Army Reserve
  --Army Reserve Child and Youth Services Program
  --Army Reserve Education Services
  --Army Reserve Employer Relations
  --Army Reserve Facility Management Transformation
  --Full-Time Support Revalidation
  --Regional Personnel Service Centers
  --Reserve Components Separate Competitive Categories for Officer 
        Promotions
  --Selected Reserve Incentive Program
  --Sexual Assault Prevention and Response Program
  --Trainees, Transients, Holdees and Students Account
  --Voluntary Selective Continuation of Alerted and Mobilized Selected 
        Reserve Lieutenant Colonels and Colonels
    Army Retention Program
    Army Spouse Employment Partnership
    Army Well-Being
    Army's Capstone Concept for the Future Force
    Base Realignment and Closure Decisions for the Army in 2005
    Basic Officer Leader Course
    Battle Command
    Business Transformation
    Campaign Quality Force
    Child and Youth Services School Transition Support
    Civilian Aides to the Secretary of the Army Program
    Combating Weapons of Mass Destruction
    Combined Force Interoperability through Security Cooperation
    Concept Development and Experimentation
    Cultural Awareness and Language Capabilities
    Defense Integrated Military Human Resources System
    Defense Support to Civil Authorities
  --Avian Flu Pandemic Preparation
  --Establishment of Army Forces North
  --Hurricane Katrina Response
  --Special Events for 2005
    Deployment Cycle Support Program
    Expeditionary Capabilities
    Freedom Team Salute
    Future Combat Systems
    Future Combat Systems Manned Ground Vehicle Development
    Global Force Posture
    Information Assurance and Network Security
    Installation Design Standards
    Integrated Global Presence and Basing Strategy
    Interceptor Body Armor
    Joint Improvised Explosive Device Defeat Organization
    Joint Interdependency
    Joint National Training Capabilities
    Joint Tactical Radio System
    LandWarNet and the Global Information Grid
    Life Cycle Management Initiative
    Live, Virtual, Constructive Training Environment Integration
    Major Acquisition Programs
  --Future Combat Systems
  --Black Hawk Utility Helicopter
  --Medium Extended Air Defense System
  --Chinook Cargo Helicopter
  --Longbow Apache Attack Helicopter
    Medical and Dental Readiness
    Medical Infrastructure Requirements for Army Transformation
    Military-to-Civilian Conversions
    Modular Conversion
    Modular Force
    Multi-Component Family Network
    Naming Convention Decisions
    National Security Personnel System
    Rapid Equipping Force
    Rapid Fielding Initiative
    Recruiting an All-Volunteer Force
    Red Team Education and Training
    Reset
    Residential Communities Initiative
    Restructuring Army Aviation
    Review of Education, Training, and Assignments for Leaders
    Science and Technology
    Soldier's Creed
    Spiraling Technology into the Current Force
    Stability Operations Capabilities
    Stabilizing Soldiers and Units to Enhance Cohesion and 
Predictability
    Sustainable Range Program
    Sustaining the Force
    U.S. Army Combat Training Center Program
    U.S. Army Wounded Warrior Program
    Unity of Effort
    Up-Armored Vehicle Program
    Utilities Privatization
    Virtual Family Readiness Group
    Warfighter Information Network--Tactical
    Warrior Tasks and Battle Drills

    Senator Stevens. General Schoomaker, we'd be happy to have 
your statement.

                STATEMENT OF GENERAL PETER J. SCHOOMAKER

    General Schoomaker. Chairman Stevens and Senator Inouye and 
other distinguished members of the subcommittee, it's a 
pleasure to be with you today.
    I'm going to limit my opening statements to some 
introductions, if I might. But I would like to start out by 
telling you, again, how proud I am to be able to serve with 
these great soldiers and their family members that we have 
today.
    And, in direct answer to Senator Dorgan, which I'd be glad 
to expound upon later, if you want, we now, after 4 years at 
war, which is, by the way, longer than World War II--we now 
have deployed approximately 52 percent of our regular force. 
And we are doing a study to look at the Reserve forces, as 
well, to figure it out.

                               RETENTION

    Of those soldiers that we have deployed overseas on either 
Operation Iraqi Freedom (OIF) or Operation Enduring Freedom 
(OEF), 75 percent--in excess of 75 percent of those soldiers 
that have deployed have re-enlisted and are remaining in the 
current Army. As you look at the deployments increasing--yeah, 
this sounds counterintuitive, but as they increase, so does the 
percentage of those that remain, all the way up to--I have 
charts here that--from the study that indicates that we have 
soldiers--for instance, soldiers on their fifth deployment, 93 
percent of them have remained in the Army. So, there is a 
dynamic taking place here that's extraordinary, in my view, 
that speaks very well to the dedication of these soldiers and 
their professionalism.
    I also believe it talks to the effect of our 
transformational efforts to balance the Army and to achieve 
some predictability and increased readiness in the force as we 
go forward. So, I'd be glad to talk more to that later.
    I would like to introduce those that are present with us 
today that I think we should recognize for your situational 
awareness. First of all, we have Lieutenant General Clyde 
Vaughn, all the way to the right, who is the Director of the 
Army National Guard, and Lieutenant General Steve Blum, who is 
the Chief of the National Guard Bureau. Next to Steve is 
Lieutenant General Ron Helmly, who is the Chief of the Army 
Reserve. You all recognize yourself there, so that--then 
directly behind me--I know they're posted all over all the post 
offices around the country, so you probably recognize them--
somebody not in the post office, but they should be, is 
Lieutenant General Jerry Sinn, who is directly behind me. He is 
the military deputy for the Army Budget, who is very, very 
important to us.
    I would--it's with a great deal of pleasure that I now 
introduce three soldiers, one Active, one Guard, one Reserve. 
And these soldiers are typical and representative of those 
soldiers that we've got serving in our great Army. And I'd like 
to start with Sergeant Billie Grimes, who is sitting here. Some 
of you may have seen her on the cover of Time magazine. She's 
the center soldier. She is a combat medic. And she served, 
previously, 4 years in the Army Reserve. She's now on active 
duty, serving at the Army--U.S. Army Medical Research Institute 
of Infectious Diseases (USAMRIID) up at Fort Detrick, up where 
we have USAMRIID.
    Now, Sergeant Grimes was serving on OIF with the 1st Armor 
Division, and is the young combat medic that saved the life of 
the Time reporter who lost a portion of his arm and his hand to 
a grenade attack, where she responded very quickly. She was 
part of the 501st Forward Support Battalion who was supporting 
a field artillery unit there that was doing duties in Baghdad. 
And as Senator Inouye pointed out, not only is she the proud 
recipient and wearer of the Combat Medical Badge, which is like 
the Combat Infantry Badge. I mean, it's a very, very highly 
respected badge. She also has three Army commendation medals 
(ARCOMs). And you'll notice, as Senator Inouye pointed out, she 
also has a Good Conduct Medal, which most of us don't get to 
earn, because we're not enlisted solders--but, anyway, we're 
very proud of Sergeant Grimes and her service.
    Next to her is Staff Sergeant Sean M. Boiko. And Sergeant 
Boiko is from Van Nuys, California, a member of the Army 
Reserve. And he is an MP, a 31 Bravo, one of the most deployed 
Military Occupational Specialty (MOS), just like Sergeant 
Grimes' MOS, 91 Whiskey. Currently, he is in the community-
based healthcare system program at Fort Meade, Maryland, where 
he is working to overcome his wounds so that he can remain in 
the Army.
    You'll notice he wears the Purple Heart, the ARCOM, and the 
Combat Action Badge. Sergeant Boiko was a member of an eight-
man Military Transition Team (MiTT), which is our military 
transition teams that are training the Iraqi army. And he was 
stationed between Fallujah and Ramadi in some tough country in 
al Anbar Province, where he came under attack by an improvised 
explosive device (IED) and ended up being evacuated for his 
injuries. He had injuries to his left arm, hearing loss, and 
very severely herniated disks in his back. And he's now been 
through about 6 months of rehabilitation, and they feel that, 
within the next several months, that he will be able to achieve 
the standards to remain in the Army, which is his desire to do. 
We're very proud of him, as well.
    You'll notice he wears a 2nd Marine Division patch on his 
right shoulder because that's who he was supporting out there.
    Thank you, Sergeant Boiko.
    Now, this last fellow is Specialist Jason Mike, and he's 
from Radcliff, Kentucky. He's in the Kentucky Army National 
Guard. He also is a medic. Notice he's wearing the Combat 
Action Badge. And he was with a Military Police (MP) Company 
that was on Route Tampa during OIF3, where he ended up in an 
action that has become well known. This was a convoy of about 
30 trucks that was ambushed by over 50 insurgents. And his MP 
platoon responded, and they got into about a 45-minute 
firefight.
    Now, what's interesting is, you'll notice he's kind of 
built like a football player, and that's because he was. He was 
a fullback. And so, in the middle of this action, Specialist 
Mike ends up with a squad automatic weapon in one arm, and a M-
4 carbine in the other hand, fighting in both directions at the 
same time in his trench line, where, after having killed 27 
anti-Iraqi-force insurgents, wounding six, capturing one, and 
after firing an anti-tank weapon at one of the strongholds that 
they had, he then turned to treating the wounded there, and, as 
a result, was awarded the Silver Star for his actions.
    So, again, we're very, very proud of him and what he 
represents.
    I will wrap up, saying that we have submitted a posture 
statement for the record, which is our formal statement. I 
stand behind the Secretary and his statement, and, again, stand 
prepared to answer your questions.
    Thank you.
    Senator Stevens. Well, thank you very much, General.
    Without objection, we'll set our time limit at about 7 
minutes.
    Mr. Secretary and General, I'm going to have to go back and 
make a statement on the floor here before the hour is out, so 
the co-chairman will conduct the hearing.

                  ARMY NATIONAL GUARD FORCE STRUCTURE

    Mr. Secretary, the budget for the Army now reflects an Army 
National Guard strength at 333,000 soldiers. We were told, the 
press reported, that we're going to be 350,000 soldiers. And 
then there was reduction. And 75 Senators, including ourselves, 
signed a letter to Secretary Rumsfeld about the importance of 
the National Guard. And I understand there's now been a 
decision to keep the 350,000. But we haven't had a budget 
amendment to cover them. How are we going to pay for them?
    Mr. Harvey. Our original plan, as you noted, Senator, was 
to fund the National Guard at whatever level they could recruit 
and retain. So, for the last 14 or 15 months, that's been on 
the average of 333,000, with the proviso that if they recruited 
and retained to a higher number, we would fund to that number. 
Now, in order to go--the basic soldier cost to go from 333,000 
to 350,000 is approximately $300 million, including the basic 
complement of soldier, equipment, and--their pay, and their 
benefits, and their training. So, we would submit a--if 
required, a change to the budget in order to fund that.
    Senator Stevens. You're not now over the 333,000.
    Mr. Harvey. We're slightly over it. I believe we're between 
335,000 and 336,000 right now. So, the Guard, for the last 5 
months, unlike the preceding 13 or 14, is meeting their 
recruitment goals. So, it's all good news right now. They are 
starting to turn the corner. They had leveled off in the high 
20s. They were down to 328,000 to 329,000, and stabilized about 
333,000. And now they're growing--again growing. So, whatever 
number that they can recruit and retain, we will fund to that 
number. And if reprogramming is necessary, we'll submit the 
request to the appropriate committees to do that. For fiscal 
year 2006 they are funded at 350,000.
    Senator Stevens. General, what changes have been made in 
the Army National Guard that are structural? And can you really 
tell us, is your concept still the total force Army--Active, 
Guard, and Reserve? Is that still the concept we're working on?

                 ARMY FORCE GENERATION MODEL (ARFORGEN)

    General Schoomaker. Sir, that is still the concept. We're 
talking about a single force. Where the Guard and Reserve in 
the past have been considered a strategic reserve to be called 
up, for instance, in the cold war sense, with an awful lot of 
forewarning, what we are now doing is organizing, training, and 
equipping a total force--Active, Guard, and Reserve--on a 
common modular basis, where all of the brigades, by type, are 
the same. And our intent is to man and equip all of the 
brigades at 100 percent of requirement, placing them in a force 
rotation model that gives all of the forces predictability, in 
terms of when they are susceptible for deployment--
fundamentally, the Active Force, on a one-and-three rotation; 
the Guard, on a one-and-six rotation--in other words, at about 
half the speed; and the Army Reserve, on a one-and-five 
rotation.
    Senator Stevens. This modularity concept, then, the Active 
and Guard are equipped and trained the same, right?
    General Schoomaker. Exactly the same, sir.
    Senator Stevens. Are they interchangeable, the brigades?
    General Schoomaker. Totally. I might also add that if you 
take a look at the 2005 to 2011 program for the Army, there is 
approximately $21 billion worth of equipment investment in 
there, which is more than four times the previous program's 
investment in the National Guard. And that does not count the 
approximately $2 billion worth of investment in new aviation 
going into the Guard and Reserve.
    Senator Stevens. Well, Mr. Secretary, last year we were 
talking about converting to 34 brigade combat teams. Now our 
staff tells us recent briefings have indicated there's 28 
units. Is that the top number now, 28?
    Mr. Harvey. The fundamental change from last year, which, I 
might note, was driven by the Army's best estimate of what the 
steady-state deployment requirements would be. And based on the 
Department of the Army's best estimate in anticipation that the 
Quadrennial Defense Review (QDR) would give us a better number, 
we chose 20 brigade combat teams, which then, if you put that 
into the rotational models that the chief talked about, you 
would come up with 43 brigades in the Active, and 34 in the 
Guard. And that's how we got to those numbers.

                       QUADRENNIAL DEFENSE REVIEW

    Coming out of the QDR, the QDR said the strategic window 
for steady-state deployment coming out of operational 
assessments and other judgments was--between 18 and 19 was 
sufficient strategically to meet the needs of the 21st century 
security environment.
    Using that as a steady-state, we decided that we could do 
that with 42 in the Active and 28 in the Guard. So, that's 
where those two numbers came from. That was demand-driven, 
where the previous numbers were really an estimate, a supply-
driven estimate, in anticipation of the QDR.
    We have a number that is determined by a strategic 
assessment. We feel good about that number.
    In conjunction with the 28, however, we also looked at the 
Guard structure and decided we did not have enough support 
brigades for their State mission. So, we increased the number 
of support brigades by six. When you add it all up, they 
started out with 106. They ended up with 106. And, as I 
mentioned in my opening remarks, the mix is different. And we 
believe that mix is consistent with their dual mission, their 
State mission, as well as their national defense mission.
    Senator Stevens. Well, this is going to have to be my last 
question, but we've got the future combat system now, costs are 
up from $92 billion, as estimated, to now $160 billion. We're 
having modularity, the global posture review, future combat 
systems. These are all budgetary challenges. And are they all 
financed within the amount that's been requested here?
    Mr. Harvey. Yes, the Army modular force and the future 
combat system are in the base budget for fiscal year 2007.
    Senator Stevens. Thank you very much.
    Gentlemen, I hope you'll excuse me. There's--I've got to 
debate an amendment on the floor.
    Senator Inouye [presiding]. Thank you very much.

                                TRICARE

    General Schoomaker, when I had the privilege of serving in 
the military, only 4 percent of the personnel in my regimental 
combat team had dependents--they were married and had children; 
96 percent had no dependents whatsoever. Today, I believe, in 
the United States Army, it's somewhere between 70 and 75 with 
dependents. Whenever I visit an Army base, I ask for the 
privilege and opportunity to chat with enlisted personnel. No 
officers around. It never fails, the first question asked is on 
health benefits for the dependents. And now, the DOD is talking 
about copayments for benefits, for pharmaceutical items. My 
question to you, will this have any impact on recruiting, and 
especially retention?
    General Schoomaker. Sir, I don't believe so, because the 
copayment issue does not affect the Active Force. The Active 
Force is covered totally. And I'm talking about those soldiers 
that are serving. The issue that you're describing affects 
those that have retired from Active duty----
    Senator Inouye. But not for pharmacy. The copayment affects 
Active personnel also, in the hospital.
    General Schoomaker. Sir, I'd have to check on that.
    Mr. Harvey. We'd have to check on that. But they do have--
the option is that you don't have to pay anything if you use 
the national service.
    General Schoomaker. I don't believe there's any change in 
the current----
    Mr. Harvey. No.
    General Schoomaker [continuing]. Practice of--what we are 
trying to encourage people to do is use the mail pharmacy 
program.
    Mr. Harvey. Yes.
    General Schoomaker. I will check and provide it for the 
record.
    [The information follows:]

    The proposed changes do not increase pharmaceutical costs 
for Active duty Soldiers and do not increase costs for active 
duty families or retirees if the prescription is filled at a 
military treatment facility or through the TRICASE mail-order 
system. However, the proposal would increase prescription drug 
co-payments for dependents and retirees who use a retail 
pharmacy. I have attached a slide outlining these proposed co-
payment changes for fiscal year 2007.

                                                TRICARE PHARMACY
----------------------------------------------------------------------------------------------------------------
                                                     Active Duty      Active Duty Families        Retirees
                                               -----------------------------------------------------------------
                                                            Proposed              Proposed              Proposed
                                                            (fiscal               (fiscal               (fiscal
                                                 Current      year     Current      year     Current      year
                                                             2007)                 2007)                 2007)
----------------------------------------------------------------------------------------------------------------
MTF:
    Generic...................................  .........  .........  .........  .........  .........  .........
    Brand Name................................  .........  .........  .........  .........  .........  .........
    Non-formulary.............................  .........  .........  .........  .........  .........  .........
Mail Order:
    Generic...................................  .........  .........         $3  .........         $3  .........
    Brand Name................................  .........  .........          9         $9          9         $9
    Non-formulary.............................  .........  .........         22         22         22         22
Retail:
    Generic...................................  .........  .........          3          5          3          5
    Brand Name................................  .........  .........          9         15          9         15
    Non-formulary.............................  .........  .........         22         22         22         22
----------------------------------------------------------------------------------------------------------------

    General Schoomaker. But the main emphasis of the 
recommendation that we've made is to capture or to help control 
the costs of those--of retired persons, up to the age of 65, 
before Medicare kicks in. So, what we are trying to do is 
arrest this excessive growth, and to normalize the copays back 
to the time in which they were started. There's never been an 
adjustment to this.

                        EQUIPMENT MODERNIZATION

    Senator Inouye. Twenty-five years ago, when Chairman 
Stevens and I began our service on this subcommittee, the Army 
had so-called big five systems, the M1 tank, the Bradley, the 
Blackhawk, Apache, and the Patriot missiles. Today, you're 
still buying these systems. Do we have any new ones?
    Mr. Harvey. Yes, we do, Senator. The future combat systems 
is that ground-based modernization that will provide the next-
generation man-ground systems, as well as a number of other 
supporting systems that will make both the current force and 
that future force more effective. In terms of--we also have, in 
parallel with that, a very large aviation modernization 
program, which consists of two new helicopters, the light 
utility helicopter, which is mainly for the National Guard, and 
the armed reconnaissance helicopter, which is a replacement for 
the OH58 Kiowa Warrior. We're also modernizing the fleet, in 
terms of the next model of the Blackhawk, conversion of the 
Apaches from the A to D model, and the upgrade of the Chinook. 
We have a very broad-based helicopter program and a very broad-
based program to upgrade the ground based, and also developing 
the next-generation theater air defense, the PAC3 MEAD system. 
So, across the board, we're modernizing.
    General Schoomaker. Sir, if I could add to that. If we do 
not pursue the future combat system, we will not have a new 
start in over 40 years of a major system like the Bradley tank, 
the things that you mentioned. We are not building new tanks, 
and we're not building new Bradleys. We are refurbishing them 
with the reset money and the rebuild money that we have asked 
for. The power of the future combat system is in the spinouts, 
the four technology spinouts that we are taking to put over the 
top of the existing reset force. And the manned ground 
vehicles, which are the final piece of this, that bring in the 
new systems that are beyond 2014. I think it's important to 
recognize that the restructuring we did on flight control 
systems (FCS) last year--or the year before, is an important 
piece of how we're modernizing the force. And the business 
transformation of FCS the Secretary brought in is working on 
the affordability.

                      STRYKER BRIGADE COMBAT TEAMS

    Senator Inouye. I note that we were very enthusiastic about 
the Stryker. But now, in the fiscal year 2007 budget, you're 
asking for less. I think you've cut it in half.
    Mr. Harvey. Well, Senator, in the mix of the 42 brigade 
combat teams and of the 28 I talked about, 7 are Stryker 
brigade combat teams. And we're very high on the Stryker 
system, and we view that as a bridge between the heavy units 
that we have today and the future combat system of the future. 
The eight manned ground vehicles that the Chief mentioned. It's 
an excellent force. There are going to six in the Active, and 
one in the Guard. But I think what you saw, the decrease, is 
because we're getting to the end of that program. We've fielded 
three to four already. We're going to complete the remaining 
three.

                  RECRUITING AND RETENTION INCENTIVES

    Senator Inouye. I have one last question, Mr. Secretary. 
The Army faces a $1 billion shortfall in bonuses and incentives 
for recruiting and retention; the Reserve, $360 million; and 
the National Guard, $250 million. My question is, Why doesn't 
your fiscal year 2007 fully fund these requirements?
    Mr. Harvey. Senator, the numbers I'm looking at, in terms 
of recruiting and retention incentives, show increases in the 
base budget between all the years. We'll submit these for the 
record.
    But I'm looking, for example, that last year recruiting and 
retention incentives are about $300 million. This year, 2006, 
we requested $341 million, and then, 2007, an increase. But 
we'll get you those numbers for the record.
    And the other thing is that we also include incentives and 
advertising in the supplemental. Unfortunately, this is just 
the way it's proposed. We'll provide, for the record, the total 
between base budget and supplemental fiscal year 2006 to 2007 
so you can see the total package.
    Senator Inouye. Well----
    Mr. Harvey. And I think you're going to see that there's an 
increase.
    Senator Inouye. I ask the question, because we want to be 
helpful to you.
    Mr. Harvey. I know you do. And we appreciate the past 
support. And you've been very, very generous. And, by the way, 
I think that is a key ingredient in the fact that for the last 
9 months we have made our recruiting goals in the Active. And 
we're kicking in some additional incentives because of what you 
passed in the 2006 budget. And I think they're having a very 
beneficial effect.
    For the record, we'll get you the entire package, because 
you've got to look at the two components together.
    Senator Inouye. Thank you, sir.
    [The information follows:]

          Recruiting and Retention Budget for Fiscal Year 2007

    Fiscal year 2007 recruiting and retention budget request 
support a peacetime base force of 482,400 Army. Our current 
planning assumes continued recruiting and retention challenges. 
We continue to evaluate the Army's recruiting and retention 
requirements, and to work with OSD and the Administration to 
refine our total requirements during our nation's time at war.

                ENLISTED RECRUITING AND RETENTION BUDGET
                        [In millions of dollars]
------------------------------------------------------------------------
                                             Fiscal year--
                             -------------------------------------------
                                 2004       2005       2006       2007
------------------------------------------------------------------------
AC:
    PB/Appropriated.........        322        305        305        392
    Title IX/Supplemental...  .........        257        575  .........
    Reprogramming...........         24        190  .........  .........
    Executed................        346        752        505  .........
USAR:
    PB/Appropriated.........        129        135        189        178
    Title IX/Supplemental...  .........          9        217  .........
    Reprogramming...........  .........  .........  .........  .........
    Executed................        112        130        133  .........
ARNG:
    PB/Appropriated.........        216        244        376        383
    Title IX/Supplemental...  .........         54        195  .........
    Reprogramming...........  .........        196  .........  .........
    Executed................        215        494        353  .........
------------------------------------------------------------------------

    Senator Inouye. Senator Shelby.
    Senator Shelby. Thank you.

                             DEPOT FUNDING

    Secretary Harvey, it's my understanding--and you correct me 
if I'm wrong--that the Army's intent is to, what you call, 
``pure fleet'' its active duty armor brigades with M1A2 SEP 
tanks by procuring at least one brigade, or 60 tanks, at every 
budget opportunity. Would it not make sense--assuming that's 
true, would it make sense to ensure that both the 2006 
supplemental and the 2007 appropriations bill fund these 60 SEP 
tanks?
    Mr. Harvey. As you know--you may be referring to the 
supplemental that we proposed and the supplemental that was----
    Senator Shelby. Right.
    Mr. Harvey [continuing]. That made it through the system. 
Our position is that, provided that the supplemental request 
that was not included in the 2006 supplemental, it will be 
included in the 2007. So, we have a master plan to, as you say, 
``pure fleet'' both the Active and the Guard, and we've got, of 
course, the industrial organic capability to do that at our 
depots. And so, we view, over the next 2 years, if those are 
funded per our request--so, what wasn't funded in 2006 is 
funded in 2007 bridge, we're okay. We've got detailed plans of 
loading the depots. And, provided that's timely, I think we 
feel like we have sufficient funding to do that. And it's very 
important that we do that, because that's all part of having a 
fully resourced Army.
    Senator Shelby. Got to have it, hadn't you?
    Mr. Harvey. Got to have it.

                    UNMANNED AERIAL VEHICLES (UAVS)

    Senator Shelby. General, unmanned aerial vehicles, some of 
us are concerned that the Air Force is considering options 
which would effectively give them procurement authority and 
operational control of the extended-range multiple-purpose 
unmanned aerial vehicle program. What steps has the Army taken 
to ensure that this does not happen, if that's going down that 
road? I mean, the Army's got a big role to play here, I 
believe. And you're playing it.
    General Schoomaker. Well, I would agree. And I do not 
foresee the situation that you described.
    Senator Shelby. I hope not.
    General Schoomaker. Because we are working hand-in-glove 
with the Air Force, as you know, on a Center of Excellence----
    Senator Shelby. Absolutely.
    General Schoomaker [continuing]. At Indian Springs, which 
primarily has to do with the whole notion of how we have common 
tactics, techniques, and procedures, and how we maintain 
command and control, so that we can share the----
    Senator Shelby. Absolutely.
    General Schoomaker [continuing]. The take from these. But 
the extended range multi-purpose (ERMP) UAV program is a purely 
Army program that is tied to our force structure and is 
organic----
    Senator Shelby. And your needs, right?
    General Schoomaker. Excuse me?
    Senator Shelby. Your needs in the Army.
    General Schoomaker. Exactly. I do not see this as an issue 
at all. And it certainly has never risen as an issue between 
the Chief of Staff of the Air Force and myself. We have a very 
good----
    Mr. Harvey. Let me say, Senator, also, that----
    Senator Shelby. Okay.
    Mr. Harvey [continuing]. That we continue to explore ways 
that we can jointly develop----
    Senator Shelby. Absolutely.
    Mr. Harvey [continuing]. Components so that we can minimize 
the cost. I think a good example of----
    Senator Shelby. Well, we've encouraged you to do this in a 
lot of areas.
    Mr. Harvey. Yes. A good example of our close cooperation 
with the Air Force is the joint cargo aircraft----
    Senator Shelby. Right.
    Mr. Harvey [continuing]. Which we are now developing 
together. So, we continue to explore that, but, at the same 
time, we have unique needs that we need to develop on our own.
    General Schoomaker. I'd like to add, too----
    Senator Shelby. Yes, sir.
    General Schoomaker [continuing]. Before we leave this. If 
you remember, when we restructured and canceled Comanche----
    Senator Shelby. Absolutely.
    General Schoomaker [continuing]. And we restructured Army 
aviation, we gave up the buy of a considerable amount of manned 
rotary-wing aircraft----
    Senator Shelby. Yes.
    General Schoomaker [continuing]. For the ERMP capability. 
This is inherent to our Army aviation structure, to our 
intelligence, surveillance, reconnaissance (ISR) structure in 
the Army, and it is not something that, in my view, can be 
farmed out. This is a level below what it is that the Air Force 
brings in on----
    Senator Shelby. Thank you.
    General Schoomaker [continuing]. Their systems.

                       JOINT CARGO AIRCRAFT (JCA)

    Senator Shelby. Secretary Harvey, if I can go back, you 
mentioned the joint cargo aircraft. And when you develop 
something jointly, there are costs involved. If the Air Force 
is going to use it as a single platform, the Army's going to 
use it, is it more than you need for the Army, or will the 
jointness take care of everything?
    Mr. Harvey. You mean the basic----
    Senator Shelby. Sometimes we'll--are the needs for the Air 
Force more than you need in the joint cargo aircraft?
    Mr. Harvey. This----
    Senator Shelby. Would it cost----
    Mr. Harvey. The least--the design is----
    Senator Shelby. Do you see what I'm getting at?
    Mr. Harvey. Yes, I do. The basic design of the aircraft, I 
think, is a convergence of the needs of both services.
    Senator Shelby. Right.
    Mr. Harvey. Then you get a common platform, and then you 
make modifications to that platform, depending on what specific 
needs you have. If you added up A plus B, which is we go our 
way, they go their way, but we go together, C is less than A 
plus B. So, I think, overall, it's a savings. And both services 
know that to be successful, both needs----
    Senator Shelby. Sure.
    Mr. Harvey [continuing]. Have to be met. So, I'm very 
optimistic that we'll do it, and we'll also save the taxpayers 
money.
    Senator Shelby. That's what we want to do. But, first, the 
mission.
    Mr. Harvey. That's right.

                       JOINT COMMON MISSILE (JCM)

    Senator Shelby. The joint common missile, I bring that up 
again. You know, it was terminated in December 2004 in the 
budget decision 753, even though a lot of us thought it had a 
healthy low-risk program. It was on schedule, it was on budget, 
and successfully demonstrating important new capability for the 
warfighter.
    In 2006, Congress appropriated $30 million, General, you 
will recall, for the JCM. What's the plan for 2007? And why was 
funding not included for the JCM in the 2007's--President's 
budget? Mr. Secretary, you want to----
    Mr. Harvey. There's a joint study ongoing----
    Senator Shelby. It is.
    Mr. Harvey [continuing]. In the joint staff, an analysis of 
alternatives. And my understanding is, there's going to be a 
decision made by the Joint Chiefs of Staff Requirement 
Oversight Council (JROC) in April----
    Senator Shelby. Yes.
    Mr. Harvey [continuing]. And a recommendation made to the 
Deputy Secretary in May, and a decision. So, the decisionmaking 
process is fully engaged right now. Depending on what course of 
action they decide, then we will certainly request funding for 
that program, either by reprogramming or--internally--or 
externally, ask the committee to reprogram.
    So, I think a thoughtful program is going on. I think it's 
been established that there is a capability gap in both Navy 
and Army. And so, it's not ``if,'' it's ``how'' to best meet 
that gap. We may----
    Senator Shelby. Thank you.
    Mr. Harvey [continuing]. Be back for some reprogramming 
action.
    Senator Shelby. Mr. Secretary, General, we thank you--I 
do--for serving. Again, we are proud of these soldiers you 
brought us here. We all are. And we should all acknowledge 
that.
    Thank you, Mr. Chairman.
    Senator Inouye. Thank you very much.
    One last question, sir. Your 2007 budget request calls for 
$111 billion.
    Mr. Harvey. Right.

                         UNFUNDED REQUIREMENTS

    Senator Inouye. Your supplemental is $35 billion. And 
there's another item, called the ``Unfunded List,'' of $7.4 
billion. Some of my colleagues have been asking me, ``Are these 
requirements?''
    Mr. Harvey. I think the Chief is best prepared to answer 
that.
    General Schoomaker. I'm not sure which unfunded list you're 
asking for. We traditionally have been asked, from the House, 
for an unfunded requirements list. In general, with more 
dollars, what we would do is accelerate our plan. That's what 
we want to do, is accelerate the plan that we're on. It's a 
very tightly knit plan, the Army campaign plan that pulls all 
this together. My view is, the faster we can execute it, the 
cheaper it will be and the smarter we will be by getting it 
accomplished in anticipation of budgetary pressures in the out-
years. That would be my answer to you.
    Senator Inouye. In other words, in order to make your 
fiscal year 2007 budget request really work, the unfunded list 
is necessary.
    Mr. Harvey. Let me just state as follows. The end state, 
Senator, in terms of force structure, in terms of our 
modernization programs that we've talked about, the end state 
being the 70 brigade combat teams, the 211 support--that will 
not change. We believe that that force structure and our 
modernization programs and the other funding that you provide 
in--for recruiting and retention, it's just a matter if we want 
to accelerate that and reduce institutional risks or--not 
operational risks. This would be running the factories, running 
the depots. You know, if you got the big momentum going, we 
want to keep it going. So, it just--it would accelerate us 
getting to the end state that we--the Chief and I--which is a 
fully resourced--that is, a fully equipped, trained, and manned 
Army across all components--to the numbers we talked about. 
That's what we would do.
    General Schoomaker. Sir, if I could just add. I just want 
to make sure I'm very clear in the answer that I gave to you. 
In the past, you might have seen an unfinanced requirement list 
that would have said, ``Look, we had to make decisions, and we 
had to leave things out.''
    Mr. Harvey. Yes.
    General Schoomaker. In this case, we are funding our plan 
totally at the speed at which we get funding. If we were to 
achieve more funding, we would go faster on exactly the same 
program.
    Mr. Harvey. Right.
    General Schoomaker. And that was what I was trying to say 
there. And I think----
    Mr. Harvey. Right. We're not----
    General Schoomaker [continuing]. It supports what----
    Mr. Harvey [continuing]. Leaving anything out.
    General Schoomaker. Right.
    Mr. Harvey. It's a matter of timing. The quicker, the 
better, I think, because of the risk involved. And so, I think 
we would reduce risk if we get there faster. But, this is very 
acceptable.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Inouye. Mr. Secretary, General Schoomaker, on 
behalf of the chairman, I thank you for your service and for 
your testimony today. And I'd like to thank the three heroes 
here with us, and their comrades who are now serving us. Thank 
you very much.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
           Questions Submitted to General Peter J. Schoomaker
              Questions Submitted by Senator Thad Cochran

                          HYPERBARIC TREATMENT

    Question. General Schoomaker, I have been informed that hyperbaric 
treatment helps reduce tissue loss from wounds and could mean the 
difference between amputation above or below the knee, elbow or other 
major joint. Funds were appropriated in the fiscal year 2006 budget for 
the Army to purchase and emplace a hyperbaric chamber for the Walter 
Reed Army Medical Center to help treat wounded veterans returning from 
Iraq and Afghanistan. Would you agree we should provide these veterans 
with quality care and the best chance for recovery? Could you provide 
this Subcommittee with an update on the status of this project?
    Answer. The Army is committed to providing the best possible 
healthcare to wounded Soldiers. The medical benefit of hyperbaric 
treatment for most of the Soldiers treated at Walter Reed Army Medical 
Center is very limited. Most of these patients had amputations 
performed prior to reaching Walter Reed, so hyperbaric capability at 
Walter Reed would not have prevented these amputations. In fiscal year 
2005, 10 patients from Walter Reed, including six retirees, three 
Soldiers, and one family member, were provided hyperbaric therapy at 
local civilian hospitals at a total cost of $73,049. Additionally, 
funds were appropriated for the Navy to purchase and emplace a 
hyperbaric chamber for the National Naval Medical Center at Bethesda. 
For the very small number of patients at WRAMC who would benefit from 
this therapy, it is much more cost effective to buy hyperbaric therapy 
from civilian hospitals. The Army does not have a clinical need for a 
chamber at Walter Reed and does not have the necessary staff to use a 
chamber as intended. Given the Base Realignment and Closure decision to 
close the existing Walter Reed campus, it is not in the Army's best 
interest to put a chamber at Walter Reed that will not generate a 
return on investment in terms of purchased care savings or research 
capabilities. The Army has asked the Subcommittee to reconsider this 
project and to allow us to use the appropriated funds to upgrade the 
Magnetic Resonance Imaging machine which will benefit many of the 
combat casualties, Soldiers, families, and retirees cared for at Walter 
Reed.

                         INTRA-THEATER AIRLIFT

    Question. General Schoomaker, I know the Army has budgeted to 
procure a new intra-theater light cargo aircraft to replace the C-23 
Sherpa aircraft and the CH-47 Chinook heavy-lift helicopters. Under 
Secretary Kenneth Krieg directed the Army and the Air Force to complete 
an acquisition strategy for a new Joint Cargo Aircraft program, and I 
have been informed that earlier this month a joint program office 
charter, with the Army as lead agency, was announced. General, will the 
Army's intra-theater cargo lift requirements be fully met by the joint 
cargo aircraft procurement?
    Answer. The Joint Cargo Aircraft (JCA) program will meet the Army's 
organic intra-theater fixed wing cargo aircraft lift requirements by 
providing the capability to transport time-sensitive, mission-critical 
resupply, and key personnel transport at the tactical level. The Army's 
approved Aviation modernization plan and fixed wing Organization & 
Operations (O&O) plan calls for the replacement of the existing Army 
utility and cargo fixed wing aircraft with two aircraft variants; the 
Future Cargo Aircraft (FCA) and the Future Utility Aircraft (FUA). The 
Army initiated the fixed wing modernization with the FCA program. The 
FCA is scheduled to replace the Army's aging and less capable C-23 
(Sherpa) fleet, its C-26 (Metroliner) fleet, and a portion of the C-12 
(King Air) fleet. The FCA is not a replacement for the CH-47 (Chinook); 
the FCA system provides a complementary capability to the CH-47 
helicopter. The Army plans to begin development of the FUA Critical 
Capabilities Document (CDD) in fiscal year 2009.
    On December 20, 2005, the Office of the Secretary of Defense (OSD) 
issued a Program Decision Memorandum (PDM) that directed the Services 
to develop and brief a FCA/Light Cargo Aircraft (LCA) Joint Program 
Office Plan to the Defense Acquisition Executive (DAE), Mr. Krieg, no 
later than February 28, 2006. The Services initiated the process of 
folding the Air Force's LCA emerging capabilities into the Army's FCA 
program in January 2006. Between January 12 and March 17, 2006, the 
Services developed a Joint FCA Acquisition Strategy Report (ASR), a 
draft Joint Program Office Charter, and a draft Memorandum of 
Agreement, which together detail the way ahead for convergence of the 
two programs into a single JCA program. These agreements state that the 
Army will be the initial lead for the JCA program and that the JCA 
Program Office will be located in Huntsville, Alabama. On March 17, 
2006, Mr. Krieg approved the Joint FCA ASR and the JCA request for 
proposal was subsequently released.
    Question. General Schoomaker, can you update the committee on the 
timeline making the selection for the new Joint Future Cargo Aircraft?
    Answer. The JCA request for proposal was released on March 17, 2006 
and are due no later than May 17, 2006. The Services' JCA source 
selection process will begin in May 2006 and proceed through December 
2006. The Services anticipate Milestone C and contract award in January 
2007.
    Question. General Schoomaker, has the merging of the Air Force's 
requirements with the Army's on this program affected the Army's target 
date for deployment of the aircraft?
    Answer. The Army's FCA ASR was forwarded for the DAE's approval on 
November 15, 2005. At that time, the Army anticipated releasing the FCA 
request for proposal on December 15, 2005. On December 20, 2005, the 
Office of the Secretary of Defense issued a PDM that provided initial 
funding to the Air Force to initiate development of a LCA program. The 
same PDM directed the Services to develop and brief a FCA/LCA Joint 
Program Office plan to the DAE, Mr. Krieg, no later than February 28, 
2006. On December 22, 2005, Mr. Krieg withheld his approval of the 
Army's FCA ASR pending completion of a Joint (Army/Air Force) FCA ASR. 
The joint Future Cargo Aircraft ASR was subsequently approved by the 
DAE on March 17, 2006 resulting in a three month slip in the Army 
portion of the JCA program. The Army still anticipates the first unit 
being equipped in fiscal year 2009.
    Question. General Schoomaker, will the Army explore having U.S. 
allies join the program in the developmental phase--as a number have 
done with the Joint Strike Fighter program--or do you know if coalition 
nations have expressed an interest to purchase this new cargo aircraft?
    Answer. The JCA is a commercially available aircraft, currently 
offered on the open market, and to date no U.S. coalition partners have 
requested to participate in the JCA program. While it is possible for 
coalition nations or NATO partners to procure JCA directly from the 
original equipment manufacturer, once the vendor is selected some 
coalition partners may seek to participate in the U.S. sponsored 
program.

                           ARMY MODULAR FORCE

    Question. General Schoomaker, I continue to watch the Army's 
transformation efforts with interest. As I understand it, instead of 
divisions being the centerpiece of the Army, brigade combat teams will 
be a strategically agile force that can ``plug into'' joint and 
coalition forces in an expeditionary manner. Could you describe what 
the Army will look like at the end of fiscal year 2007 and the rate at 
which the remainder of the Army to include the National Guard will 
become a modular force?
    Answer. Modular transformation is the most dramatic restructuring 
of forces since World War II. The centerpiece is the building of 
brigade combat teams (BCT) and associated multi-functional and 
functional support brigades. The Army also is rebalancing our forces to 
create the right mix of units, develop critical Soldier skills, and 
build effective operational and institutional forces across all three 
components. The Army is building toward 70 BCTs and 211 multi-
functional and functional support brigades. By the end of fiscal year 
2007, the active component will have converted 29 modular BCTs and 
activated nine new modular BCTs. Additionally, the active component 
will have built 32 multi-functional and functional support brigades. 
Active component modular transformation will be completed by fiscal 
year 2010. The Army National Guard is building toward 28 BCTs in a 
total of 106 brigades by the end of fiscal year 2011. By the end of 
fiscal year 2007, the Army National Guard will have converted 25 BCTs 
and built 50 multi-functional and functional support brigades. However, 
the BCT conversion primarily addresses changes in unit designs and 
manning to facilitate recruiting and individual training. The equipping 
upgrades to complete the conversions of these brigades will extend 
through fiscal year 2011. The Army Reserve will have 65 support 
brigades by fiscal year 2007. However, with completion of modular 
transformation in fiscal year 2011, the Army Reserve will re-size to a 
total of 58 multi-functional and functional support brigades. The Army 
is currently conducting a collaborative effort with the Army National 
Guard Adjutants General to address warfighting requirements, current 
operational demands and potential Homeland Defense missions. The 
results of this effort may change the number and type of BCTs and 
support brigades in the Army National Guard beginning in fiscal year 
2008.
                                 ______
                                 
            Questions Submitted by Senator Dianne Feinstein

                   TRAINING OF IRAQI SECURITY FORCES

    Question. The Administration and the Pentagon continue to repeat 
the mantra, ``When the Iraqis standup, we will stand down.'' However, 
here in the Congress, we continue to receive mixed reports on the 
progress of training a capable Iraqi Army. While it is my understanding 
that the number of Iraqi battalions able to function ``in the lead'' 
(or at Level 2) has increased to over 50 today, I have also heard that 
the number of Iraqi battalions at Level 1, or able to operate fully 
independently, has recently dropped from one to zero.
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. Will you please explain why we have had such difficulty 
transitioning Iraqi forces from Level 2 to Level 1? How is it that not 
one Iraqi battalion is able to function independently of coalition 
forces?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. Are you confident the U.S. military in Iraq has enough 
qualified trainers to adequately train the Iraqi forces? Should U.S. 
commanders on the ground shift additional forces from security duties 
to training?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. What percentage of the Iraqi Army controlled by the 
Ministry of Defense is Sunni? To what extent are former officers and 
soldiers--disbanded through our ``Debaathification'' policy--returning 
to serve in the Army? What incentives are being provided to lure Sunni 
recruits?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. What is the ethnic makeup of the Iraqi battalions in an 
advanced state of readiness? What percentage of these battalions are 
made up of Kurdish and Shiite recruits?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. What steps are being taken to integrate units to create 
an ethnically and religiously diverse Iraqi force? From a security 
standpoint, is diversity even desirable?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. Will the emerging Iraqi forces have enough independent 
technical capabilities (communication networks, air power, heavy armor, 
weaponry, and intelligence logistics) to operate on their own without 
U.S. assistance in the near future?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. What is the timeframe for creating an Iraqi Army which is 
superior in force and skill to the Sunni insurgency or any of the 
Shiite or Kurdish militias?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. This year was labeled the ``Year of the Police'' by the 
Pentagon--a phrase clearly intending to indicate a renewed effort to 
train Iraqi security forces under the control of the Iraqi Interior 
Ministry. Please describe current U.S. oversight activities vis-a-vis 
the Iraqi police forces, particularly the paramilitary units under 
control of the Interior Ministry? How can the United States and Iraq 
further prevent Shiite militias from dominating local police forces?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. How would you assess the progress over the past 3 months 
in the training of Iraqi police units?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. To what degree do you remain concerned about the 
infiltration of police forces by: the insurgency? local militias? Iran?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
    Question. What are the greatest barriers that coalition troops 
currently face in their efforts to train an effective police force in 
Iraq?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.

           ARMY TRANSFORMATION AND THE C-17 AIRCRAFT PROGRAM

    Question. Reports suggest that the Mobility Capabilities Study 
(MCS)--which was supposed to provide the Pentagon an accurate 
projection of future strategic airlift requirements--neither takes into 
account (1) the Army's transition to a modular brigade force structure 
nor (2) the Future Combat Systems (FCS) program. Consequently it is my 
understanding that DOD has commissioned a new study (MCS-06) to address 
these and other areas that the previous MCS study failed to account for 
in considering the military's future air mobility needs. With this 
being the case, has the Army ever articulated or estimated the airlift 
requirements that will be connected to the mobilization of the 15 
Future Combat Systems (FCS) brigade combat teams (BCTs)?
    Answer. The Army is in the process of establishing the airlift 
options available to Joint Forces Commanders to support the deployment 
of Future Combat Systems (FCS) Brigade Combat Teams (BCTs). The 2005 
Mobility Capability Study (MCS 05) focused on the strategic lift 
requirements for the 2012 timeframe. The study did not consider 
deployment of FCS equipped forces. MCS 05 examined the strategic 
mobility capabilities provided by the current pre-positioning, sealift 
and airlift programs of record and found them to provide sufficient 
lift. The strategic airlift modeled in the MCS 05 study consisted of 
current programmed fleet of 180 C-17s, 112 C-5s and the Civil Reserve 
Air Fleet (CRAF), and found it to sufficient to meet lift requirements. 
We realize that now and in the future, deployment and sustainment of 
heavy Army forces in support of the combatant commanders (COCOMs) will 
employ a mix of airlift, sealift, and pre-positioned stocks. 
Maintaining this balance provides multiple options for deployment and 
employment of force. The Army requested a Joint analysis of 
requirements for global airlift, sealift, and pre-positioned stocks 
extending through 2024 and will support the MCS-06 study.
    Question. If not, when does the Army anticipate it will be able to 
provide the Air Force a realistic projection of its airlift 
requirements based on its transition from a division-centric to 
brigade-centric force?
    Answer. Developing strategic lift requirements is a Joint process 
which has to consider the type, amount, and location of forces to be 
moved. MCS 06 will capture the modular mobility requirements for 
sealift, airlift and associated pre-positioning. COCOMs dictate the 
timing and location for the delivery of Army forces within the context 
of a Joint Force flow. Personnel and equipment required during the 
first 30 days of a conflict will be given the highest priority for 
movement by airlift. The heavy units that are needed in less than 30 
days may be pre-positioned rather than have them compete for strategic 
airlift. Finally, the equipment and sustainment items not required in 
the first 30-45 days will likely be delivered by sealift. The Army 
provides input to the development of these requirements by providing 
Joint Staff and COCOM planners with Army Future Force concepts of 
employment and capabilities. COCOM and Joint planners will then develop 
the Joint Force flow requirements that will be used to development 
total Joint lift (sea and air) requirements. Pre-positioned stocks will 
also be used to fill shortfalls in either sealift or airlift due to 
wither speed of delivery of sealift or physical capacity (amount of 
lift) of the aircraft.
    Question. Under the Global Posture Review, 38 of the Army's 42 
active-duty brigade combat teams (BCTs) will eventually be stationed in 
the Continental United States, Alaska, and Hawaii. At any one time, the 
Army hopes to have up to 19 of these BCTs (14 active and 4-5 reserve) 
PLUS associated operational headquarters and support brigades--ready 
for operations world-wide. Given this force reconfiguration--based on 
operational requirements--are you confident there will be sufficient 
military airlift to transport up to 15 of these brigade combat teams 
(BCTs), along with the associated headquarters and support units, from 
bases in the United States to a crisis area?
    Answer. Airlift is only one portion of strategic lift capability to 
deploy Army forces. The bulk of Army combat power will be projected by 
sea. Airlift, coupled with sealift and globally pre-positioned stocks, 
provides for both rapid employment and long-term sustainment of Army 
forces. The 2005 Mobility Capability Study (MCS 05) which modeled 
strategic airlift requirements based on the current programmed fleet of 
180 C-17s, 112 C-5s and the Civil Reserve Air Fleet (CRAF) indicates 
that DOD has sufficient strategic airlift available through the 2012 
timeframe. Both the Army transformation to modular brigades and 
restationing in response to the Global Posture Review will be completed 
within the timeframe considered.

                           CIVIL WAR IN IRAQ

    Question. We have seen a significant increase in the number of 
Iraqis killed in sectarian violence over the past 3 months. Reports 
suggest that over 1,000 have died since the February 22nd bombing of 
the Golden Mosque in Samarra and over the weekend we discovered more 
evidence of revenge killings in a mass grave that included 30 beheaded 
bodies. Former Iraqi Prime Minister Ayad Allawi has stated his belief 
that Iraq is already experiencing a civil war. However, Pentagon 
officials and the Administration have taken great pains to dispute the 
idea that we have entered into a period of civil war in Iraq.
    For the record, do you believe Iraq is now enmeshed in a ``civil 
war?''
    If not, how would you define a ``civil war?''
    Finally, assuming that Iraq is now (or does) face a full-blown 
civil war, how does this affect U.S. military strategy and the status 
of U.S. troops deployed in the region?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.

                            TROOP REDUCTIONS

    Question. Does the Army plan to reduce its endstrength in Iraq this 
year? Next year?
    Answer. In accordance with title 10, U.S. Code, the Army is charged 
with organizing, manning, training and equipping a force capable of 
fulfilling current and future Secretary of Defense-approved 
requirements of combatant commanders. Thus, the Army force scheduled to 
deploy in future rotations to Iraq is conditional upon periodic 
strategic and operational assessments from the Commander, U.S. Central 
Command (CENTCOM). The number and type of forces requested by the 
CENTCOM commander may fluctuate as the political, economic and security 
conditions in Iraq and Afghanistan evolve over time.

           TROOP REDUCTIONS/TRAINING OF IRAQI SECURITY FORCES

    Question. Do you agree with General Casey that a drawdown in U.S. 
troops might ease some of the enthusiasm for the ongoing insurgency in 
Iraq?
    Answer. The President's National Strategy for Victory in Iraq is 
very clear in that we will help the Iraqi people build a new Iraq with 
a constitutional, representative government that respects civil rights 
and has security forces sufficient to maintain domestic order and keep 
Iraq from becoming a safe haven for terrorists. To this end, the Army 
is committed to providing General Casey with the required Army 
capabilities for success on the ground in Iraq.

                            TROOP REDUCTIONS

    Question. Secretary of State Rice and Chairman of the Joint Chiefs 
of Staff General Pace have both suggested in recent days that it is 
likely that the military will drawdown troop levels sometime this year. 
Last fall General Casey, the top commander in Iraq, stated that a 
reduction in American troops would take ``away an element that fuels 
the insurgency.''
    How do you think that a reduction in the number of American forces 
would affect the rise in sectarian violence in Iraq?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.

                        IRAQ'S INFLUENCE IN IRAQ

    Question. Earlier this month, Secretary Rumsfeld said in a press 
conference that Iran is ``currently putting people into Iraq to do 
things that are harmful to the future of Iraq. They're putting Iranian 
Qods Force-type people into the country.''
    Can you provide more information on this statement--how many 
Iranian nationals have you found in Iraq, what are they doing, and are 
they collaborating with the Iraqi SCIRI party?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.
                                 ______
                                 
                Questions Submitted to Francis J. Harvey
               Questions Submitted by Senator Ted Stevens

                               MODULARITY

    Question. What is the estimated total cost of the Army's modularity 
initiative? How much funding has been provided to date to implement the 
modularity initiative? What is the estimated amount of future funding 
needed to complete the modularity initiative?
    Answer. The Army estimates the total cost of the modularity 
initiative at $52.5 billion through fiscal year 2011. To date, the Army 
has received $6.5 billion: $5 billion in the fiscal year 2005 
supplemental and $1.5 billion programmed in the base budget in fiscal 
year 2006. The estimated amount needed to complete the Army modularity 
initiative is $46 billion.

                       FUTURE COMBAT SYSTEM (FCS)

    Question. What is the estimated total cost of the FCS program? How 
much funding has been provided to date for the FCS program? What is the 
estimated amount of future funding needed to complete the FCS program?
    Answer. As reported in the Program Manager, Future Combat Systems 
(Brigade Combat Team) (PM FCS (BCT)) Selected Acquisition Report, dated 
December 31, 2005, the estimated total cost is $119.9 billion (fiscal 
year 2003 Base Year dollars) or $164.6 billion (then year dollars). 
From fiscal year 2003 through fiscal year 2006, the FCS program has 
been appropriated in the amount of $8 billion (then year dollars) while 
only receiving actual funds of $7.6 billion. With the current funding 
schedule, the estimated funding requirement is approximately $157 
billion (then year dollars).

                          RESETTING THE FORCE

    Question. To date, how many units has the Army reset? How much 
funding has been provided to date to reset Army units? Based on current 
information, how much future funding is needed to reset Army units?
    Answer. The Army has reset or will have reset a total of 95 
brigade-sized or brigade combat team elements from fiscal years 2004-
2006. The break-out of brigade-size elements by year is shown below:

                            TOTAL ARMY BCT'S
------------------------------------------------------------------------
                                                              No. BCT's
                       Component/Unit                          or units
------------------------------------------------------------------------
Active:
    3ID....................................................            5
    4ID....................................................            5
    2/82...................................................            1
    3/1 ID.................................................            1
    3ACR...................................................            2
    101st..................................................            6
    2ACR...................................................            1
    1/10...................................................            1
    2/10...................................................            1
    Various................................................            3
NG:
    45th Inf...............................................            1
    Various (no BDE sized elements all various (CS/CSS)....            4
USAR: Various (no BDE sized elements all various CS/CSS)...            5
                                                            ------------
      Total Army BCT's Supported in Fiscal Year 2004.......           36
                                                            ============
Active:
    101 ID.................................................            6
    4 ID...................................................            6
    172 ID.................................................            1
    1 AD...................................................            1
    10 MNT.................................................            3
    Various (no BDE sized elements all various CS/CSS).....            3
NG: Various................................................            4
USAR: Various..............................................            2
                                                            ------------
      Total Army BCT's Supported in Fiscal Year 2005.......           26
                                                            ============
Active:
    3ID....................................................            5
    1/82d..................................................            2
    1/25th.................................................            1
    2/2ID..................................................            1
    3/1 AD.................................................            1
    3 ACR..................................................            2
    2/10th 2 (1 BCT, plus DISCOM slice)....................            2
    1st COSCOM.............................................            1
    Various (no BDE sized elements all various CS/CSS).....            3
NG: Various................................................           12
USAR: Various..............................................            3
                                                            ------------
      Total Army BCT's Being Reset in Fiscal Year 2006.....           33
------------------------------------------------------------------------

                        BUSINESS TRANSFORMATION

    Question. Please describe how the Army is accelerating Business 
Transformation efforts in the fiscal year 2007 budget request. What is 
the estimated total cost to implement Army Business Transformation 
efforts? What is the estimated total savings the Army expects to 
achieve as a result of Business Transformation efforts?
    Answer. To explain how the Army is accelerating Business 
Transformation efforts in the fiscal year 2007 budget request, the 
scope of Army Business Transformation needs to be understood, then how 
specific budget requests accelerate this transformation and associated 
total cost and savings can be explored.
    Our business transformation initiatives include Continuous Process 
Improvement (CPI) using the Lean Six Sigma (LSS) methodology, Business 
Situational Awareness, Organizational Analysis and Design (OAD), and 
Professional Development.
    We have started the largest deployment of Lean Six Sigma ever 
attempted. This effort is underway with training, education, and 
project selection. Projects will be both centrally sponsored for 
crosscutting initiatives as well as command specific; a combined top-
down and bottom-up approach to accelerate the transformational effect. 
The result will be reduced cost and cycle time while increasing 
quality, production, reliability, and safety.
    Business situational awareness is the product of timely and 
accurate information to support policy and resource allocation systems. 
These enterprise information solutions will provide Army leaders 
clarity on systems and processes where today it is difficult to 
observe.
    Organizational Analysis and Design examines functions and structure 
of organizations, then redesigns and realigns organizational elements 
as necessary to accomplish the mission/work assigned. This analysis, 
design, and alignment will reduce redundancies and ensure organizations 
can effectively and efficiently fulfill the needs of our warfighters.
    Professional Development of Army Leaders is critical to successful 
business transformation and the Army is examining ways to broaden the 
education, training, and experience of our officers and civilians to 
meet the complex challenges of leading the Army business enterprise. 
This initiative area will help educate and develop leaders of Army 
enterprises so that they are fully prepared for the challenges of 
leading the Army's complex business organizations.
    To ensure these efforts are successful and to highlight their 
importance, we created the Office of the Deputy Under Secretary of the 
Army for Business Transformation, headed by Mr. Michael Kirby.
    The scope of the efforts just reviewed is immense, literally 
touching or impacting every facet of the Army. The fiscal year 2007 
budget request accelerates these efforts by: funding the initial wave 
of projects and certification for lean six sigma (LSS) deployment ($7.8 
million in fiscal year 2007); with opportunities to all subordinate 
organizations to reallocate their training budgets to invest in this 
primary effort.
    The answer to the question of total cost is elusive for several 
reasons. Since business transformation includes efforts that will 
become embedded in the fabric of the Army, these efforts will not end; 
instead, they will become a self-sustaining Army capability, changing 
the way we do business. For example, the LSS deployment is using 
industry experts, where the Army lacks them, to train, create, and 
certify Army experts who will soon be able to do the training, and 
certification of future Army experts. Thus a better understanding of 
the relevant cost for the Continuous Process Improvement and 
Organizational Analysis and Design efforts is likely startup costs--the 
lean six sigma certification and initial project costs identified 
above.
    The cost of providing business situational awareness in most cases 
will be embedded within the technology that we are obtaining to help 
manage the Army enterprise. The transformational aspect is how we use 
the data that enterprise resource planning (ERP) programs provide not 
necessarily the program itself. While it might be technically correct 
to include the cost of all ERPs in the total cost of business 
transformation, I think it is more appropriate to attribute these costs 
to the functions each ERP is being designed to produce and that is the 
way they are shown in the fiscal year 2007 budget request.
    No cost estimate currently exists for professional development 
since it is still under intense study and no specific course of action 
has been determined.
    The answer to the question of total savings is as elusive as total 
costs not only in an accounting perspective but also due to replication 
and economies of scale. The benefits generated from business 
transformation in many cases are not directly pecuniary--LSS and OAD 
will increase responsiveness and quality; SA will increase the quality 
of decision making; and professional development will help create more 
capable leaders. Likewise some of the savings are impossible to 
estimate at this point--LSS and OAD projects are still being scoped; SA 
will identify redundancies that are currently unknown; and professional 
development impacts cannot be estimated until the path forward is 
decided.
    The answer to this set of questions may lack the specificity 
desired. This highlights one of compelling reasons that we need to 
transform the way we do business. As we move forward to the Army will 
share the results of these initiatives with you.

                RESTRUCTURING THE FORCE--AC/RC REBALANCE

    Question. When does the Army expect to complete the AC/RC 
rebalancing effort? What costs are associated with implementing the AC/
RC rebalancing initiative? How is the AC/RC rebalancing effort 
synchronized with the Army modular force effort?
    Answer. Active component/Reserve Component (AC/RC) rebalance is 
always an on-going part of force re-structuring as the Army addresses 
the right mix of capabilities to meet strategic and operational 
requirements. Beginning with the Program Objective Memorandum (POM) for 
2004-2009, the Army formally identified restructuring initiatives 
affecting the mix of capabilities across all three components. 
Subsequent initiatives were generated by the Secretary of Defense 
guidance in July 2003, concerning the reduction of involuntary 
mobilization of the RC in the first 15 days of a rapid response 
operation, and limiting involuntary mobilization to not more than one 
year every six years. Additionally, the Chief of Staff, Army, focus 
area in early 2004, addressed manning issues, high demand/low density 
capabilities and the establishment of training overhead accounts 
(Transient, Trainees, Holdees and Students--TTHS) for the RC. Under 
these three phases of force re-structuring, the Army program identified 
over 125,000 spaces of change between fiscal years 2004-2009. At the 
end of 2005, the Army had completed re-structuring efforts affecting 
over 30,000 spaces--approximately 21,000 in the rebalance of 
capabilities across the three components and over 9,000 affecting the 
elimination of over structure and the establishment of TTHS accounts in 
the RC. Costs for phase one and phase two initiatives were reflected as 
offsets across existing programs to capture the changes in equipment, 
facilities, and operational tempo as force capabilities were rebalanced 
across the components. The costs for phase three have been reflected in 
the re-investment of existing programs and improved readiness as RC 
overstructure is eliminated. With implementation of modular 
transformation beginning in fiscal year 2004, additional re-structuring 
initiatives will occur through fiscal year 2011. Based on the results 
of Total Army Analysis (TAA) 2008-2013, and the efforts underway with 
POM 2008-2013, the Army will update its AC/RC rebalancing program in a 
report to the Office of the Secretary of Defense in June 2006. The 
update will synchronize AC/RC rebalance initiatives with the Army 
Campaign Plan and will ensure all re-structure and rebalance efforts 
are linked to modular transformation.

                  BASE REALIGNMENT AND CLOSURE (BRAC)

    Question. What is the Army total cost estimate for implementing the 
BRAC recommendations?
    Answer. The current Army BRAC estimates are in the range of $15 to 
$18 billion. The fiscal year 2007 President's budget request funded 
$9.5 billion for Army BRAC through the BRAC implementation period 
(fiscal year 2006-2011). For fiscal years 2006 and 2007, the 
requirements of $4.4 billion fully fund the program. The Army continues 
to refine the remaining BRAC implementation requirements to be 
resourced and these will be documented in the 2008/2009 BRAC 
President's budget request.

         INTEGRATED GLOBAL PRESENCE AND BASING STRATEGY (IGPBS)

    Question. What is the Army's estimated total cost to implement 
IGPBS decisions? How much funding has been provided to date to 
implement IGPBS decisions? What is the estimated amount of future 
funding needed to implement IGPBS decisions?
    Answer. The Army estimates the total cost of IGPBS at $2.9 billion 
through fiscal year 2013. This includes Base Realignment and Closure 
IGPBS stationing actions included in the 2005 BRAC Commission Report. 
In fiscal year 2006 the Army has funded $460.8 million; $337.6 million 
for BRAC and $123.2 million base budget (MCA--$12 million; MPA--$33 
million; OMA--$66.7 million and OPA--$11.5 million). The remaining 
estimated amount needed to complete IGPBS is $2.4 billion.

            WARFIGHTER INFORMATION NETWORK--TACTICAL (WIN-T)

    Question. What is the Army plan for transitioning from Joint 
Network Node to WIN-T? Please explain how the WIN-T program has been 
rebaselined to support the FCS program? What is the estimated total 
cost of the WIN-T program? How much funding has been provided to date 
for the WIN-T program? What is the estimated amount of future funding 
needed to complete the WIN-T program?
    Answer. Currently, the Army is assessing how to optimize transition 
from the procurement and fielding of the Joint Network Node to 
Warfighter Information Network--Tactical (WIN-T). The WIN-T program's 
re-baselining supports Future Combat Systems (FCS) by aligning the 
availability of configuration items to support FCS integration and lab 
testing. Afterward, WIN-T will provide form fit and function products 
that meet prescribed space, weight, and power dimensions and liquid-
cooling technology for integration into FCS platforms. The total 
acquisition cost for the WIN-T program per the December 2005 Selected 
Acquisition Report (SAR) is estimated in fiscal year 2003 constant 
(base year) dollars at $10.6 million for Research, Development, Testing 
and Evaluation (RDTE) and procurement costs. The total acquisition cost 
in then year dollars is $14.2 million. The total amount of funding 
provided to date in fiscal year 2003 constant (base year) dollars 
(2002-2006) for WIN-T is $322.6 million. Adjusted for inflation, this 
amount is $335.7 million (then year dollars). The estimated amount of 
future funding needed to complete the WIN-T program estimated in fiscal 
year 2003 constant (base year) dollars is $10.2 million. Adjusted for 
inflation, this amount is $13.8 million (then year dollars) for RDT&E 
and procurement.

                   JOINT TACTICAL RADIO SYSTEM (JTRS)

    Question. Prior to the JTRS program restructure, what was the Army 
total cost estimate to develop and field JTRS Cluster 1 and JTRS 
Cluster 5 radios? What is the Army's current total cost estimate to 
develop and field JTRS radios? How has the Army JTRS fielding plan 
changed as a result of the program restructuring?
    Answer. The JTRS Program had programmed approximately $3 billion in 
the Future Years Defense Plan (FYDP) prior to the restructuring. After 
the restructuring, the current estimate to develop the total JTRS 
Increment 1 program, which includes the air, ground, and maritime 
domains is now approximately $4 billion in the FYDP. The Army portion 
of this DOD enterprise-wide estimate is approximately one-third of the 
$4 billion. This estimate was approved by the Department in November 
2005 at the Defense Acquisition Board (DAB). The Increment 1 
development is designed to deliver critical networking capabilities to 
the warfighter. Future incremental developments will add additional 
capabilities as technology matures and funding becomes available.
    Since the program has been restructured, the Army's fielding plan 
has changed to accommodate the revised funding and program timelines 
approved by the DAB. In general, the JTRS program restructuring delayed 
the fielding of JTRS capabilities about two years. The FCS program, as 
well as other Army fielding plans, has been synchronized to achieve 
JTRS capabilities as soon as the JTRS begins to field its systems 
(fiscal year 2009/10).

           ARMY TRANSFORMATION AND THE C-17 AIRCRAFT PROGRAM

    Question. What is the estimated total cost to implement the 
recommendations of the Army Aviation Task Force? How much funding has 
been provided to date to implement Army Aviation Task Force 
recommendations? What is the estimated amount of future funding needed 
to complete implementations of Army Aviation Task Force 
recommendations? Please describe how Army Aviation Modernization 
efforts have changed since completion of the Army Aviation Task Force 
review?
    Answer. In 2003, the Chief of the Staff, Army (CSA) directed Army 
aviation to become a ``capabilities based maneuver arm optimized for 
the joint fight with a shortened logistics tail.'' The desired outcome 
is aviation units in modular configuration that are agile, flexible, 
deployable, and sustainable.
    The Acting Secretary of the Army and CSA recommendation to 
terminate the Comanche program was supported by the Secretary of 
Defense and approved by the President on February 20, 2004. It was 
subsequently briefed to Congress the week of February 23-27, 2004.
    In order to implement the aviation focus group recommendations and 
CSA-approved decisions, all funding resulting from the termination of 
the Comanche program and all funding within aviation programs will 
remain with the Aviation Battlefield Operating System for the 
resourcing of aviation programs.
    Army aviation funding, from both the aviation base budget and 
Comanche reprogramming, totals $12.2 billion (fiscal year 2005-2007) 
and is applied in accordance with the aviation investment strategy. 
Retention of funding within Army aviation, combined with the commitment 
from senior Army leadership, the Secretary of Defense, Congress, and 
the President, creates the opportunity to ``fix'' Army aviation. The 
challenge is in maintaining the long term fiscal discipline necessary 
to fully implement the strategy.
    The aviation investment strategy supports the Army Aviation 
Modernization Plan, included in the Army Modernization Plan, which 
describes the changes intended to improve Army capabilities to meet 
current and future full-spectrum aviation requirements. The Aviation 
Modernization Plan was developed based on a full Doctrine, 
Organization, Training, Leadership and Education, Materiel, Personnel, 
and Facilities analysis that included the integration of lessons 
learned from recent operations.
    Army aviation is moving aggressively to (1) Satisfy current and 
future operational capabilities; (2) Modernize the entire fleet while 
supporting current deployments; (3) Rapidly acquire best materiel 
solutions by facilitating correct and comprehensive policies; and (4) 
Achieve Joint interoperability, modularity and deployability through 
transformation.

                     RECEIPT OF SUPPLEMENTAL FUNDS

    Question. Secretary Harvey, it would be helpful if you could 
explain how soon you will need the Supplemental funds requested for the 
Global War on Terror which were requested in mid-February. Also, could 
you share with the committee what impact there would be from any delay 
in receipt of the requested funds?
    Answer. We will need the Supplemental enacted in May in order to 
receive the funding by early June. After this date we risk exhausting 
all funds from both Title IX and base programs and could face 
insolvency in some appropriations.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran

                    ARMY NATIONAL GUARD END STRENGTH

    Question. Secretary Harvey, the fiscal year 2007 budget funds the 
Army National Guard at 333,000 and not the congressionally mandated 
350,000. I understand this is part of the Army's plan to transform and 
to modernize.
    A positive aspect of your plan is that National Guards units would, 
for the first time, be resourced equivalent to active forces. I also 
understand there is a commitment from the Department to fund the Army 
National Guard to the strength they are able to recruit, up to 350,000.
    Based on current indicators, the National Guard will exceed 
retention goals. In Mississippi for example, the Guard achieved 101 
percent of their retention mission during a very difficult time that 
they were supporting the Global War on Terror and trying to deal with 
the terrible effects of Hurricane Katrina.
    My question to you is how will the Department fund the increase in 
personnel when Guard recruiting and retention goals are achieved?
    Answer. The Army is committed to funding the Army National Guard to 
350,000 in fiscal year 2007. Cost per 1,000 National Guard Soldiers is 
difficult to capture based on each Soldier's varied status in the 
National Guard. For example, Soldiers mobilized for Operation Iraqi 
Freedom costs differ dramatically from a Soldier performing weekend 
drill on inactive duty for training. Efforts are ongoing regarding the 
equipment/investment (procurement) restoral, and the total amount 
depends on the final outcome of force structure adjustments.

                          EQUIPMENT READINESS

    Question. Secretary Harvey, I understand that high utilization 
rates and extreme conditions in Iraq and Afghanistan continue to take a 
toll on military equipment. I have also been informed that 
traditionally, units returning from combat operations bring their 
equipment back with them. However, in order to minimize transportation 
costs and keep key items in the combat zone, this has not been the case 
relative to Iraq and Afghanistan. For example, the 155th Separate Armor 
Brigade from Mississippi left 370 trucks, 14 wreckers, and 20 
ambulances in Iraq which impacts readiness and its ability to conduct 
training and homeland security missions along with responding to the 
Governor's call.
    Are funds requested in this budget request and in the fiscal year 
2006 Supplemental adequate to finance the repair and replacement of 
equipment damaged or destroyed during combat operations in Iraq and 
Afghanistan?
    And do they ensure the Guard, Reserve and active units have the 
equipment at their home stations necessary to maintain readiness 
ratings, conduct training and respond to homeland security missions or 
natural disasters?
    Answer. The key to our ability to sustain our long-term commitments 
at home and abroad is to reset our equipment and make near and long-
term investments in a better equipped, more capable force. To achieve 
this, we need Congress to support our reset and investment strategies 
specified in our program and supplemental requests for fiscal years 
2006 and 2007.
    As you know, years of under-funding for the Army prior to 9/11 
resulted in a $56 billion ``hole'' in readiness across all three 
components due to insufficient modernization to fill existing 
shortfalls and emerging needs. That ``hole'' deepens due to battle 
damage and operational wear and tear. We maintain sustainment stocks in 
theater to rapidly replace battle losses in the short-term to mitigate 
risk to Soldiers and operations. We also prioritize dollars and 
equipment to deployed units, sustainment stocks, and next-deployers to 
ensure deployed Soldiers have what they need to accomplish assigned 
missions. All of this results in lower resource levels among units 
across the Army that are resetting and training for homeland or global 
operations.
    Resetting equipment through repair, recapitalization, and 
replacement is a wise and critical investment that provides Soldiers 
the equipment they need and enables the Army to accelerate its 
transformation to more capable units. However, reset requirement costs 
are over and above the normal costs to sustain the Army, and we expect 
the total reset bill for fiscal year 2006 to be nearly $13.5 billion. 
In accordance with DOD policy and intent, we rely on Supplemental 
funding to pay for our reset program.
    With previous Congressional help, we increased our depot production 
capacity for repair and recapitalization by 250 percent from where it 
was before the war, and we reset 37 brigade combat teams in the last 
two years. Many of those brigades have already returned to theater in 
their more capable, modular configuration. We have also increased and 
fenced our investment accounts for the Reserve Component to more than 
$24 billion in fiscal year 2005-11.
    Fiscal year 2007 will be pivotal for the Army. While the Office of 
the Secretary of Defense has not yet submitted a request for 
supplemental funding in fiscal year 2007, the anticipated funding in 
fiscal year 2006 and fiscal year 2007 will enable us to address reset 
while protecting our investment accounts. Resetting and investing will 
enable us to transform and provide better manned, trained, and equipped 
Army units for full spectrum operations in defense of the nation at 
home and abroad.

                  BASE REALIGNMENT AND CLOSURE (BRAC)

    Question. Secretary Harvey, included in last year's BRAC was the 
decision to close the Mississippi Army Ammunition Plant (MSAAP) on 
Stennis Space Center. Since the facility was located on land leased 
from NASA, I understand the facility will be turned over to NASA. I 
understand NASA and the Army are in discussion concerning this 
transfer; however, it seems the two parties are at an impasse. I am 
hopeful the Ammunition Plant can be the first property transferred off 
the Army's rolls. Could you provide the subcommittee with an update on 
where the Army is in the BRAC process, to include the status of the 
Mississippi Army Ammunition Plant?
    Answer The Army is in discussions with NASA and plans are 
continuing to move the Mississippi Army Ammunition Plant back to NASA 
by the end of calendar year 2006.

                     LIGHT UTILITY HELICOPTER (LUH)

    Question. Secretary Harvey, I understand the Army is in the process 
of selecting a commercial helicopter to fill the role of your Light 
Utility Helicopter to be used for non-combat missions. I congratulate 
you for deciding to use a helicopter that is already in production and 
which does not require any research and design funding. It would seem 
to me that this approach will save the taxpayers money and provide the 
Army with the needed platform in a very short period of time. Can you 
please highlight how that process is going?
    Answer. Given that the Army chose to fulfill the LUH requirements 
through the acquisition of an existing commercial available FAA 
certified aircraft the Army was able to reduce the timeline from 
concept development/refinement to acquisition to less than 36 months. 
This enables us to fulfill our commitment to modernizing the Army 
National Guard with a new light utility helicopter within the next five 
to seven years. The LUH request for proposal was released on July 26, 
2005, and the source selection activity began October 20, 2005. The 
competitive source selection is currently underway and the Army 
anticipates Milestone C and a contract award in early summer 2006.
                                 ______
                                 
              Questions Submitted by Senator Arlen Specter

                   ARMY HERITAGE AND EDUCATION CENTER

    Question. In 2001, the Army decided to incorporate a facility at 
Carlisle that would support the Army Heritage and Education Center. The 
facility would serve as both as a storage and conservation facility for 
the Army Heritage Museum collection and would serve as a conservation 
facility for the collection of historic documents and photographs Army-
wide. This facility was initially programmed for funding in fiscal year 
2006 and according to my information is now programmed in fiscal year 
2009. Could you update me on the status of the project and explain why 
the project keeps slipping though the design of the facility is 
complete and the need for the facility remains?
    Answer. The Museum Support Facility was initially programmed for 
funding in the fiscal year 2005 Future Years Defense Program (FYDP) for 
fiscal year 2009 and remains in fiscal year 2009 in the current FYDP. 
The design is currently 95 percent complete and could be ready to 
advertise in approximately three months.

 NATIONAL MUSEUM OF THE UNITED STATES ARMY/ARMY HERITAGE AND EDUCATION 
                     CENTER--COMPLEMENTARY PROJECTS

    Question. In November 2001, Assistant Secretary Fiori indicated 
that the National Museum of the United States Army and the United 
States Army Heritage and Education Center (AHEC) were complementary 
projects, not competitive and that they have different, but equally 
important missions. Since then, the Army has provide $5 million to 
contract with the Army Historical Foundation to raise funds for the 
National Museum of the United States Army facility while the Army 
Heritage Center Foundation which is raising funds for the AHEC has 
received no Army funding support. In supporting the Army Historical 
Foundation's fundraising effort, it appears that the Army does not 
consider that the AHEC is equally important. You have legislative 
authority to enter into agreements with the Army Heritage Center 
foundation to support the design, construction and operation of the 
AHEC. The Army Heritage Center Foundation has $10 million in matching 
funds from the Commonwealth of Pennsylvania to continue this project 
and the Foundation is ready to begin construction of the next phase of 
their project later this year subject to obtaining additional funds and 
grants. Does the Army support the mission of the Army Heritage and 
Education Center? Are the two facilities complimentary? What level of 
funding does the Army plan provide to contract with the Army Heritage 
Center Foundation for the continued development and expansion of the 
AHEC?
    Answer. The Army remains totally committed to both the National 
Museum of the United States Army (NMUSA) at Fort Belvoir, Virginia, and 
the United States Army Heritage and Education Center (AHEC) at Carlisle 
Barracks, Pennsylvania, as equally invaluable complimentary 
institutions. The first round of construction on the AHEC, building an 
expansive, superbly designed state of the art archive, was altogether 
funded by the Army, ample testimony to the importance of the project to 
the Army. Federal funds have been identified for other aspects of the 
overall AHEC project, although much that remains to be built is to be 
built with private funds--as is also the case with the NMUSA. It is not 
true that the Army unilaterally distributed funds to the Army 
Historical Foundation to help them raise money for the Fort Belvoir 
site. Congress identified money for the Army Historical Foundation, and 
directed the Army to administer its distribution on the behalf of the 
federal government. We are happy to do so and would like to see a 
similar arrangement made for the Army Heritage Center Foundation. The 
Army is by law limited in the help it can offer private foundations 
without Congressional intervention. Both the NMUSA at Fort Belvoir and 
the AHEC at Carlisle Barracks are complex projects with multiple 
facilities to be built over time, with various mixes of federal and 
private funding. Those facilities to be built with federal funding are 
on track and reflect the Army's unwavering commitment to both the NMUSA 
and the AHEC. We would welcome whatever support Congress extends to 
both the Army Historical Foundation and the Army Heritage Center 
Foundation--or whatever direct support Congress allows the Army to 
extend.
                                 ______
                                 
            Questions Submitted by Senator Pete V. Domenici

                      IMPROVISED EXPLOSIVE DEVICES

    Question. One of the biggest dangers facing our troops in Iraq has 
been roadside explosives known as IEDs. They have disrupted our convoys 
and patrols, and they will likely continue to threaten the on-going 
rotation of troops in Iraq. The Army leads the Joint IED Defeat Task 
Force, which is working to find and destroy these home-made bombs.
    Does the Army have the authorities it needs to get existing 
technologies in the hands of our troops to better detect these bombs?
    If not, what authorities do you need?
    What successes have you had with this task force?
    How is the task force finding, testing, and deploying new 
technologies?
    Answer. Mr. Chairman, I have asked the Director, Joint IED Defeat 
Organization (JIEDDO) to respond to your concerns.

                SCIENCE AND TECHNOLOGY (S&T) INVESTMENTS

    Question. Would you please comment on the importance of basic S&T 
investments for transformation?
    Answer. The goal of the Army Science and Technology (S&T) program 
is to achieve transformational capabilities that will enable the future 
force while pursuing opportunities to enhance current force 
capabilities. The U.S. Army's single largest S&T investment focuses on 
enabling technologies to field the initial Future Combat Systems 
Brigade Combat Team and follow-on technology insertions.
    Question. Does the Army have the funding it needs to invest in 
basic science and technology?
    Answer. With the Army fully engaged in the Global War on Terror, we 
are challenged to satisfy the resource demands to sustain current 
operations while simultaneously maintaining our S&T investments in the 
most important technologies to enable capabilities for the future 
modular force. However, the Army S&T program is funded consistent with 
the ability to mature technologies synchronized with funding resources 
we are provided to execute our acquisition programs.

                       FUTURE COMBAT SYSTEM (FCS)

    Question. Can you comment on what types of project will be tested 
at White Sands?
    Answer. The currently approved FCS test and evaluation master plan 
details the categories of testing currently planned to be conducted at 
the U.S. Army White Sands Missile Range (WSMR). All categories of 
equipment and systems in the FCS program will be tested at White Sands, 
to include manned combat and support vehicles, unmanned ground and 
aerial vehicles, sensors, and networking components. Within these 
categories, all of the FCS Platforms/systems will be tested as 
individual systems and in a system of systems environment. There are 
also 52 complimentary programs which will also participate in FCS 
system of system level testing at WSMR. These include weapon systems, 
vehicles, sensors, and communication systems. The specific categories 
of testing includes: component level specialty testing utilizing WSMR 
unique test capabilities; field experiments, which serve as program 
risk reduction efforts; Spin-Out Capability Testing for the Current 
Forces, which will begin to integrate FCS technologies into the current 
force; System of System Testing for the FCS BCT; and finally, system 
level Integrated Qualification Testing.
    Question. Do you know how much FCS testing will be conducted at 
White Sands?
    Answer. Due to the unique size and location of White Sands, the 
Army envisions conducting almost all of the system-of-systems or unit 
level testing at White Sands ranges and the adjacent Fort Bliss ranges. 
This allows experimentation and testing in an environment that provides 
an operational setting close to that envisioned for some key 
employments of the FCS Brigade Combat Team (BCT). The FCS systems, 
system-of-systems, and BCT will be experimented with, and tested at all 
unit levels up to the brigade level at White Sands. Technical component 
system level testing will be conducted at White Sands within the 
construct of their capabilities, to include electromagnetics, software, 
and unmanned systems. This technical testing will be augmented by that 
conducted throughout the Army major range and test facility base 
infrastructure as appropriate, based on unique expertise and 
facilities. This testing will be conducted on a two-year integration 
phase cycle with increasing complexity as the FCS program matures.
    Question. What does the Army need to coordinate work between Fort 
Bliss and White Sands Missile Range?
    Answer. The development, training and testing of a FCS-equipped 
force is a significant task, but from a test/training event 
coordination perspective, it is one that is not dissimilar from other 
major Army exercises such as Roving Sands. These large-scale events 
were successful only as a result of the close communication and 
coordination between Fort Bliss and WSMR. With the large area of 
operations and its doctrinal employment, it is anticipated the fully 
capable FCS-equipped brigade in the SO4/initial operational test and 
evaluation timeframe will require the use of essentially 100 percent of 
the WSMR and Fort Bliss airspace and approximately 80 percent of the 
Fort Bliss land-space and 75 percent of the WSMR land space (in area 
and 100 percent in distance). Of course these are a function of the 
scenarios and development objectives, including disparately operating 
the FCS System of Systems across the required area of operations. 
Additionally, the FCS development will require integrated frequency 
management, scheduling, and ranges across WSMR and Fort Bliss, as well 
as portability of instrumentation test assets from WSMR and 
Developmental Test Center (DTC). The WSMR and Fort Bliss have conducted 
regular interchanges in the past and continue to coordinate on emerging 
detailed requirements with an objective of establishing processes for 
integrated asset and operations support to the Army and the FCS 
development. This is simply an expansion of historical and on-going 
coordination and use of the combined capabilities. As an example, plans 
are being formulated to integrate airspace management and scheduling 
into the tri-service air traffic control center at WSMR to provide a 
regional airspace utilization operations capability for the Army 
(inducing FCS), Navy and Air Force RDT&E and training. Given all of 
this information and the associated coordination required, much work 
has already occurred between the two installations and the PM FCS (BCT) 
leadership. At this time, the Army does not anticipate any assistance 
required with coordination between the two installations and their 
respective organizations.
    Question. What can White Sands Missile Range, Holloman Air Force 
Base, and New Mexico do to help the Army with FCS testing?
    Answer. White Sands Missile Range can continue to support the 
Program Manager, FCS in the planning process and the execution of the 
FCS Testing in accordance with the current test and evaluation master 
plan. As the detailed test plans are developed, a more complete request 
for assistance may be provided.
    Question. On a related note, what will the Army's decision to 
expand its presence at Fort Bliss mean in terms of growth and increased 
activity in New Mexico?
    Answer. From a test perspective there will be a permanent presence 
established to support planning and resource development and 
coordination. The exact numbers of personnel are yet to be determined, 
but as indicated above, there will be personnel at WSMR by the summer 
of 2006. As each program test event is executed there will be a surge 
of effort to support, namely in personnel. These events will take place 
as discussed in the preceding paragraphs. Lastly, given the complexity 
of the FCS program and the magnitude of the test events, the surge in 
personnel supporting the test events will number in the 100s. With the 
central test control residing on WSMR and an aggressive test schedule 
over the next three years, it is likely this increase in personnel will 
provide a positive economic impact/growth to New Mexico.
                                 ______
                                 
              Questions Submitted by Senator Conrad Burns

                             NATIONAL GUARD

    Question. I fully support your goal of having a fully equipped and 
fully manned National Guard that is every bit as capable as its active 
component. Can you highlight your plan to transform the National Guard?
    Answer. The Army National Guard (ARNG) is simultaneously 
transforming with the active component into the modular force design. 
This is important as it is the first step along the way to ensuring 
that all three components, active, Guard, and Reserve, are 
interoperable on the battlefield. It started with the acceleration of 
the ARNG's modular force conversion as approved by the Vice Chief of 
Staff of the Army on June 9, 2005. As approved, all brigade combat 
teams will complete organizational conversion by fiscal year 2008. But 
this action only addresses unit design and manning; it does not 
complete the equipping for those brigades. To make the ARNG as capable 
as the active component, a serious investment into its equipment 
modernization is required. To address longstanding equipment shortages, 
the Army has programmed $21 billion from fiscal year 2005 through 
fiscal year 2011 for ARNG procurement to ensure that the ARNG is 
properly equipped to perform effectively as the Army's operational 
reserve. Additionally, the Army will leverage the Army Force Generation 
model to provide ARNG units a predictable time sequence for potential 
mobilization. This initiative has the benefit of focusing resources and 
training to ensure the readiness of those units that are scheduled for 
mobilization. Lastly, the restructuring of the ARNG is an important 
step to ensuring that the ARNG is properly manned. In the last couple 
of years, the Army, working with the ARNG, has eliminated its 
historical over-structure in order to align structure and manning 
within its authorized end strength of 350,000. These significant force 
structure adjustments and resource investments advance the Army's 
intent of ensuring every ARNG unit is fully equipped, fully trained, 
and fully manned.

                                SOLDIERS

    Question. As I already mentioned, our troops on the ground are our 
focus. Can you discuss how your spiral development and fielding plan is 
getting new equipment and technologies to our soldiers as quickly as 
possible?
    Answer. Nothing is more important than ensuring our Soldiers have 
the best equipment to accomplish their mission. The Army is adapting 
processes to rapidly enhance the capabilities of our units and Soldiers 
in the complex operational environments of Operations Iraqi Freedom and 
Enduring Freedom. This has the emphasis of all senior leaders and is an 
Army-wide, enterprise level effort.
    We rapidly respond to capability requirements from the field and 
constantly assess and improve fielded equipment. Effective capability 
development is more than just inserting materiel solutions, and 
requires a holistic approach that includes the integration of training, 
sustainment, organizational, and doctrinal changes.
    Army organizations have partnered to rapidly develop, assess and 
field capability to the force. Organizations such as the Army G3's 
Rapid Equipping Force, U.S. Army Training and Doctrine Command's Spiral 
Developments Division, U.S. Army Army Materiel Command's Research, 
Development and Engineering Command and the U.S. Army Test and 
Evaluation Command, have developed processes that support accelerated 
capability development. Other partners in this effort are the Assistant 
Secretary of the Army for Acquisition, Logistics and Technology; the 
Joint community; and Industry.
    We have had successes in a number of areas particularly in the area 
of force protection. This has been done through the development and 
fielding of systems through route clearance companies consisting of 
vehicles such as the Buffalo and RG31, Counter-Remote-Controlled-IED 
Electronic Warfare systems (CREW), small robots such as PACKBOT, an 
Improved First Aid Kit (IFAK), an unmanned aerial vehicles and other 
Intelligence, Surveillance and Reconnaissance and command and control 
systems.
    The efforts of these organizations have also produced a Counter 
Rocket, Artillery, Mortar (C-RAM) capability currently in use in 
theater, and training enhancements that ensure our Soldiers are better 
prepared for the asymmetric challenges in the current operational 
environment.
    To better address the asymmetric challenges, the Army recently 
organized the Asymmetric Warfare Office, under the Army G3, to lead the 
effort in developing the necessary policy, programs, and resources to 
stay in front of these types of threats.
    Our organizational and process changes are paying off. We are 
better able to quickly react to the changing battlefield, ensuring our 
Soldiers have the best equipment our nation can provide.
                                 ______
                                 
            Questions Submitted by Senator Dianne Feinstein

                               WAR COSTS

    Question. Prior to the U.S. invasion of Iraq, Pentagon officials, 
including Secretary Rumsfeld, estimated that the total cost of the Iraq 
War would not surpass $50 to $60 billion. As you know, to date, the 
cost of combat operations in Iraq has reached about $250 billion, and 
that number could well surpass $300 billion by the end of the year. 
Unfortunately, the Pentagon has not provided Congress any war funding 
estimates past fiscal year 2007.
    First, in this age of rising budget deficits, can you provide this 
Committee any type of estimate of what level of future funding will be 
necessary from the Congress to appropriately pay for the costs of this 
ongoing war?
    Answer. In the short term, we anticipate the costs of this ongoing 
war to remain at current levels. I cannot estimate future costs, which 
will be driven by the size of the coalition force in Iraq and the level 
and duration of the conflict. As the Iraqi forces accept increasing 
responsibility for the security of their country, our forces will 
withdraw and costs for military operations will decline accordingly. 
However, the Army will require funding to reset our force for an 
estimated two years beyond that timeframe.
    Question. Why does the Administration continue to rely almost 
entirely on emergency supplementals to fund the war?
    Answer. From the Army perspective, base budgeting requires a 
generally stable operational environment with predictable costs. That 
is not the case with our operations in Iraq. In addition, we anticipate 
significant changes in future funding requirements as we shift from an 
operational presence to resetting the force.
    Question. Wouldn't you agree that the American taxpayers deserve to 
know upfront--through the regular base budget--the amount of money that 
is going to the war effort? Or do you believe it is fair to continue 
the reliance on this budget gimmickry?
    Answer. The regular base budget provides comprehensive information 
on the costs to sustain America's Army across a generally stable 
period. The war effort is not part of that base, but represents the 
added costs to fulfill our role in supporting the combatant commanders.

                   TRAINING OF IRAQI SECURITY FORCES

    Question. Secretary of State Rice and Chairman of the Joint Chief 
of Joint Chiefs of Staff, General Pace, have both suggested in recent 
days that it is likely that the military will drawdown troop levels 
sometime this year. Last fall General Casey, the top commander in Iraq, 
stated that a reduction in American troops would take ``away an element 
that fuels the insurgency.'' Does the Army plan to reduce its 
endstrength in Iraq this year? Next year?
    Answer. In accordance with title 10 U.S. Code, the Army is charged 
with organizing, manning, training, and equipping a force capable of 
fulfilling current and future Secretary of Defense approved 
requirements of combatant commanders. Thus, the Army force scheduled to 
deploy in future rotations to Iraq is conditional upon periodic 
strategic and operational assessments from the Commander, U.S. Central 
Command (CENTCOM). The number and type of forces requested by the 
CENTCOM commander may fluctuate as the political, economic, and 
security conditions in Iraq and Afghanistan evolve over time.
    Question. How do you think that a reduction in the number of 
American forces would affect the rise in sectarian violence in Iraq?
    Answer. Senator, this question should be referred to the Commander, 
U.S. Central Command for response.

                          SUBCOMMITTEE RECESS

    Senator Inouye. The subcommittee will reconvene tomorrow at 
10 o'clock in the morning, when we will hear from the 
Department of the Air Force. And, until then, we'll stand in 
recess. And I thank you very much.
    [Whereupon, at 3:33 p.m., Tuesday, March 28, the 
subcommittee was recessed, to reconvene at 10 a.m., Wednesday, 
March 29.]
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