    [Senate Hearing 110-201]
    [From the U.S. Government Publishing Office]

                                                     S. Hrg. 110-201, Pt. 7

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2008

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

                                    HEARINGS

                                   before the

                          COMMITTEE ON ARMED SERVICES
                              UNITED STATES SENATE

                           ONE HUNDRED TENTH CONGRESS

                                 FIRST SESSION

                                       ON

                                    S. 1547

         TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2008 FOR MILITARY
    ACTIVITIES OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND
       FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE
    PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR FOR THE ARMED FORCES, AND FOR
                                 OTHER PURPOSES

                                   ----------

                                     PART 7

                                STRATEGIC FORCES

                                   ----------

                      MARCH 28; APRIL 11, 19; MAY 2, 2007

             Printed for the use of the Committee on Armed Services
    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                         2008--Part 7  STRATEGIC FORCES

                                                      S. Hrg. 110-201 Pt. 7

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2008

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

                                    HEARINGS

                                   before the

                          COMMITTEE ON ARMED SERVICES
                              UNITED STATES SENATE

                           ONE HUNDRED TENTH CONGRESS

                                 FIRST SESSION

                                       ON

                                    S. 1547

         TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2008 FOR MILITARY
    ACTIVITIES OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND
       FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE
    PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR FOR THE ARMED FORCES, AND FOR
                                 OTHER PURPOSES

                                   __________

                                     PART 7

                                STRATEGIC FORCES

                                   __________

                      MARCH 28; APRIL 11, 19, MAY 2, 2007

             Printed for the use of the Committee on Armed Services

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                          COMMITTEE ON ARMED SERVICES

                         CARL LEVIN, Michigan, Chairman

    EDWARD M. KENNEDY, Massachusetts     JOHN McCAIN, Arizona
    ROBERT C. BYRD, West Virginia        JOHN WARNER, Virginia,
    JOSEPH I. LIEBERMAN, Connecticut     JAMES M. INHOFE, Oklahoma
    JACK REED, Rhode Island              JEFF SESSIONS, Alabama
    DANIEL K. AKAKA, Hawaii              SUSAN M. COLLINS, Maine
    BILL NELSON, Florida                 JOHN ENSIGN, Nevada
    E. BENJAMIN NELSON, Nebraska         SAXBY CHAMBLISS, Georgia
    EVAN BAYH, Indiana                   LINDSEY O. GRAHAM, South Carolina
    HILLARY RODHAM CLINTON, New York     ELIZABETH DOLE, North Carolina
    MARK L. PRYOR, Arkansas              JOHN CORNYN, Texas
    JIM WEBB, Virginia                   JOHN THUNE, South Dakota
    CLAIRE McCASKILL, Missouri           MEL MARTINEZ, Florida

                       Richard D. DeBobes, Staff Director

                 Michael V. Kostiw, Replublican Staff Director

                                     ______

                        Subcommittee on Strategic Forces

                         BILL NELSON, Florida, Chairman

    ROBERT C. BYRD, West Virginia        JEFF SESSIONS, Alabama
    JACK REED, Rhode Island              JAMES M. INHOFE, Oklahoma
    E. BENJAMIN NELSON, Nebraska         LINDSEY O. GRAHAM, South Carolina
    MARK L. PRYOR, Arkansas              JOHN THUNE, South Dakota

                                      (ii)
    ?

                                C O N T E N T S

                                  ----------

                        CHRONOLOGICAL LIST OF WITNESSES
                           Strategic Forces Programs
                                 march 28, 2007

                                                                       Page
    Cartwright, Gen. James E., USMC, Commander, U.S. Strategic
      Command........................................................     5
    D'Agostino, Hon. Thomas P., Acting Administrator, National
      Nuclear Security Administration, Department of Energy..........    38
    Burg, Maj. Gen. Roger, USAF, Director of Strategic Security in
      the Air, Space, and Information Operations, Headquarters,
      United States Air Force........................................    53
    Johnson, RADM Stephen E., USN, Director, Strategic Systems
      Programs, Naval Systems Command................................    57
    Green, Brian R., Deputy Assistant Secretary of Defense for
      Strategic Capabilities, Department of Defense..................    59

                       Ballistic Missile Defense Programs
                                 april 11, 2007

    Obering, Lt. Gen. Henry A., III, USAF, Director, Missile Defense
      Agency.........................................................    91
    Campbell, LTG Kevin T., USA, Commanding General, U.S. Army Space
      and Missile Defense Command/U.S. Army Forces Strategic Command
      and Joint Functional Component Command for Integrated Missile
      Defense........................................................   103
    McQueary, Dr. Charles E., Director, Operational Test and
      Evaluation, Office of the Secretary of Defense, Department of
      Defense........................................................   110
    Francis, Paul, Director, Acquisition and Sourcing Management,
      United States Government Accountability Office.................   113
    Green, Brian R., Deputy Assistant Secretary of Defense for
      Strategic Capabilities, Office of the Under Secretary of
      Defense for Policy Before the Subcommittee on Strategic Forces,
      Department of Defense..........................................   122

                            Military Space Programs
                                 april 19, 2007

    Sega, Hon. Ronald M., Under Secretary of the Air Force...........   176
    Chilton, Gen. Kevin P., USAF, Commander, Air Force Space Command.   184
    Shelton, Maj. Gen. William L., USAF, Commander, Joint Functional
      Component Command for Space, United States Strategic Command...   196
    McArthur, VADM James D., Jr., USN, Commander, Naval Network
      Warfare Command................................................   198
    Chaplain, Cristina T., Director, Acquisition and Sourcing
      Management, Government Accountability Office...................   201

              Department of Energy Atomic Energy Defense Programs
                                  may 2, 2007

    Rispoli, Hon. James A., Assistant Secretary of Energy for
      Environmental Management.......................................   257
    Podonsky, Glenn S., Chief Health, Safety, and Security Officer,
      Department of Energy...........................................   281

                                     (iii)

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2008

                                  ----------

                           WEDNESDAY, MARCH 28, 2007

                                   U.S. Senate,
                      Subcommittee on Strategic Forces,
                                   Committee on Armed Services,
                                                        Washington, DC.

                           STRATEGIC FORCES PROGRAMS

        The subcommittee met, pursuant to notice, at 9:37 a.m. in
    room SR-232A, Russell Senate Office Building, Senator Bill
    Nelson (chairman of the subcommittee) presiding.
        Committee members present: Senators Bill Nelson, Reed, E.
    Benjamin Nelson, Sessions, and Thune.
        Majority staff members present: Madelyn R. Creedon,
    counsel; Richard W. Fieldhouse, professional staff member;
    Creighton Greene, professional staff member; and Thomas K.
    McConnell, professional staff member.
        Minority staff members present: Michael V. Kostiw,
    Republican staff director; Gregory T. Kiley, professional staff
    member; Jill L. Simodejka, research assistant; Robert M.
    Soofer, professional staff member; and Kristina L. Svinicki,
    professional staff member.
        Staff assistants present: Kevin A. Cronin and Jessica L.
    Kingston.
        Committee members' assistants present: Christopher Caple,
    assistant to Senator Bill Nelson; Eric Pierce, assistant to
    Senator Ben Nelson; and M. Bradford Foley, assistant to Senator
    Pryor.

           OPENING STATEMENT OF SENATOR BILL NELSON, CHAIRMAN

        Senator Bill Nelson. Good morning, everybody. The group in
    the back is a school from Cape Coral, FL, who I have just
    visited with. I have invited them for the few minutes that they
    have to come in and see what this is like up here in
    Washington, DC. We are going to be getting into some pretty
    heavy stuff this morning. You students, I want you to know that
    we have--look at all the stars on his shoulders. This is
    General Cartwright and he is the head of the Strategic Command
    and he is going to be the first witness. He is going to present
    an overview of the Strategic Command and the challenges that it
    faces.
        Then on the second panel we are going to discuss various
    strategic programs. We are going to hear from Tom D'Agostino,
    Acting Deputy Administrator of the National Nuclear Security
    Administration (NNSA), and Major General Burg, Director of
    Strategic Security in the Air, Space, and Information
    Operations. We are going to hear from Rear Admiral Johnson,
    Director of the Strategic Systems Programs in the Navy, and
    Brian Green, Deputy Assistant Secretary of Defense for
    Strategic Capabilities.
        Our hearing is going to be complicated because they are
    going to call a vote at 11 o'clock. So we are going to just go
    as much as we can and then we will have to adjourn and go vote.
        We want to have a discussion today about the Reliable
    Replacement Warhead (RRW), bombers, land-based Intercontinental
    Ballistic Missiles (ICBMs), prompt global strike, and future
    nuclear weapons stockpiles. All of the witnesses have submitted
    written testimony and so what we want to do is have a
    conversation. The written testimony will be entered in the
    record and made a part of the record, and so we want to have a
    conversation interspersed by lots of questions.
        [The prepared statement of Senator Bill Nelson follows:]

                   Prepared Statement by Senator Bill Nelson

        Good morning. Welcome General Cartwright. It is a pleasure to have
    you with us on the first panel of our strategic programs hearing. We
    will have two panels today. During the first panel we will hear from
    General James Cartwright, the Commander of the Strategic Command.
    General Cartwright will present an overview of the Strategic Command
    and the challenges that it faces.
        The witnesses on the second panel will discuss the various
    strategic programs under the subcommittee's jurisdiction. On the second
    panel, we will hear from Tom D'Agostino, the Acting Deputy
    Administrator of the National Nuclear Security Administration (NNSA);
    Lieutenant General Carrol Chandler, Deputy Chief of Staff, Air Force
    Operations, Plans and Requirements; Rear Admiral Stephen Johnson,
    Director Strategic Systems Programs, Naval Sea Systems Command; and
    Brian Green, Deputy Assistant Secretary of Defense for Strategic
    Capabilities in the Office of the Under Secretary of Defense for
    Policy.
        In the event that it is necessary, we have made provision for a
    closed session following the second panel, in room SR-222.
        We look forward to a good discussion today on a wide range of
    topics including the Reliable Replacement Warhead, bomber aircraft,
    particularly the B-52, the land-based ICBMs, prompt global strike, and
    the future nuclear weapons complex.
        All of you who have submitted written statements, these statements
    will be included in the record. Also, we will keep the record open for
    3 days for members to submit questions for the record. We would
    appreciate it if each witness could promptly answer these questions.
    Thank you.
        Again, welcome.

        Senator Bill Nelson. Senator Sessions.

                   STATEMENT OF SENATOR JEFF SESSIONS

        Senator Sessions. Thank you, Mr. Chairman. I enjoyed our
    time on this committee together when I was fortunate to be
    chairman. You were a tremendous ranking member who contributed
    so much and I enjoy working with you a great deal, and I look
    forward to trying to be as helpful to you as you have been to
    me.
        This hearing is an opportunity to stress the progress our
    Nation has made toward adapting our strategic forces and
    deterrence doctrine to a new security environment characterized
    by unpredictable threats posed by terrorist groups and rogue
    nations armed with weapons of mass destruction (WMD). While
    much of the public debate on strategic forces seems to focus on
    the role of nuclear weapons and the size of our nuclear
    arsenal, I believe we need to look also at the broader question
    of whether our Nation is acquiring all the types of strategic
    forces necessary to deal with today's new and various threats.
        The 2001 Nuclear Posture Review (NPR) called on the United
    States to reduce reliance on nuclear weapons while placing
    greater emphasis on advanced conventional weapons and defenses
    to deter and defend against new threats to our security.
    Consistent with this, President Bush announced in 2001 that the
    United States is ``committed to achieving a credible deterrent
    with the lowest possible number of nuclear weapons consistent
    with our national security needs, including our obligations to
    our allies.''
        Under the NPR framework, we have begun the drawdown of our
    nuclear forces to what will be in 2012 the lowest level since
    the dawn of the nuclear age and have begun to provide limited
    protection for our Nation and forces against ballistic missiles
    of all ranges.
        So if we agree as a Nation, as I believe we do, that we
    will continue to rely on some number of nuclear weapons for our
    strategic posture, then we must also examine seriously the need
    to make sure those weapons are safe and reliable.
        Finally, if we are truly committed to reducing our nuclear
    weapons then we must reach agreement on prompt long-range
    conventional strike weapons capable of thwarting the most
    dangerous threats to our security.
        I will ask, Mr. Chairman, that the balance of my remarks be
    made a part of the record and I look forward to hearing from
    our witnesses.
        [The prepared statement of Senator Sessions follows:]

                  Prepared Statement by Senator Jeff Sessions

        We meet today to receive testimony from two panels on strategic
    forces programs in review of the National Defense Authorization Request
    for Fiscal Year 2008 and the Future Years Defense Program. For the
    first panel, we welcome General James Cartwright, who as Commander of
    U.S. Strategic Command, is responsible for tailoring U.S. strategic
    forces and policy to the new, post Cold War security environment. The
    second panel will provide an opportunity to delve more deeply into the
    various service plans and programs for strategic forces as well as
    examine plans for revitalizing our nuclear infrastructure. Witnesses on
    the second panel include: Major General Roger Burg, USAF; Rear Admiral
    Stephen Johnson, USN; the Honorable Thomas D'Agostino, Acting
    Administrator of the National Nuclear Security Administration; and
    Brian Green, Deputy Assistant Secretary of Defense for Strategic
    Capabilities.
        This hearing is an opportunity to assess the progress our Nation
    has made toward adapting our strategic forces and deterrence doctrine
    to a new security environment characterized by unpredictable and
    perhaps undeterrable threats posed by terrorist groups and rogue
    nations. While much of the public debate thus far seems to focus on the
    role of nuclear weapons and the size of our nuclear arsenal, I believe
    the focus should be on whether our Nation is building the types of
    strategic forces necessary to deal with today's new threats.
        The 2001 Nuclear Posture Review (NPR) established a conceptual
    framework for thinking about deterrence in this new strategic age, and
    serves as a useful guide for understanding the relationship between
    offensive and defensive strategic forces, as well as the relationship
    between nuclear and conventional weapons--all of which must play a role
    in deterring strategic attacks against the United States, its forces,
    and its friends and allies.
        The NPR calls on the United States to reduce reliance on nuclear
    weapons while placing greater emphasis on advanced conventional weapons
    and defenses to deter and defend against new threats to our security.
    Consistent with this reduced reliance on nuclear weapons, President
    Bush announced in 2001 that the United States is ``committed to
    achieving a credible deterrent with the lowest possible number of
    nuclear weapons consistent with our national security needs, including
    our obligations to our allies.''
        How well have we done in drawing down our nuclear forces while
    simultaneously improving our conventional strike capabilities, fielding
    missile defenses, and securing a responsive nuclear infrastructure that
    hedges against future changes? That, I believe, is the central question
    before us. My initial assessment is mixed.
        With respect to the nuclear drawdown, we appear to be well on the
    way toward meeting our commitment under the Moscow Treaty to reduce
    operationally-deployed warheads to between 1,700 and 2,200, which will
    be the lowest level of nuclear weapons deployed by the United States
    since the Eisenhower administration. By the end of 2007, we will meet
    an interim reduction milestone of 3,800 deployed warheads. In addition,
    the U.S. has decommissioned all 50 Peacekeeper ICBMs, and has removed 4
    ballistic missile submarines from strategic service--a further
    reduction of 96 missile launchers from the strategic force. The United
    States has permanently denuclearized the B-1 bomber force and the
    administration recommends a reduction in the size of the B-52 force
    from 94 aircraft to 56, a reduction in the Minuteman ICBM force from
    500 to 450, and the retirement of 460 nuclear armed Advanced Cruise
    Missiles.
        While the nuclear-drawdown appears to be proceeding in good order,
    the same cannot be said about the fielding of the advanced conventional
    strike capabilities necessary to reduce reliance on nuclear strike
    forces. The Department of Defense has made progress in developing and
    fielding short-range precision guided conventional munitions, but such
    forces may not be in position to interdict fleeting targets, such as
    mobile ballistic missile launchers or high-value terrorist targets,
    that could inflict strategic blows against the United States and its
    interests. We lack today the capability to deliver prompt, conventional
    strikes against these targets at extremely long ranges. The development
    of this capability, sometimes referred to as ``prompt global strike,''
    has lagged due to a lack of consensus between Congress and the
    administration on how best to proceed. I plan to make it a priority
    this year to find a path that will permit the Department of Defense to
    develop and field this important new strategic capability before the
    end of the decade.
        Perhaps the most impressive change in our strategic posture since
    the NPR lies in the area of missile defense. In 2001, we could count
    only upon our Patriot batteries to provide limited missile defense
    protection against short range ballistic missiles. Today, we have over
    a dozen ground-based interceptors deployed for the defense of the
    United States against long-range North Korean ballistic missiles; a
    similar number of SM-3 missiles are available for deployment on some
    seven Aegis BMD ships to defend against short- to medium-range
    ballistic missiles; and the Army deploys hundreds of improved Patriot
    PAC-3 missiles to defend our forces against short-range threats.
    Supporting these interceptors is a global system of upgraded early
    warning and tracking radars and the command and control system
    necessary to link together these multiple sensors and interceptors. In
    just a few short years, our missile defense capabilities have moved
    from purely research and development to operational fielding, such that
    we were prepared to defend our Nation and our regional allies should it
    have been necessary during the July 2006 North Korean ballistic missile
    tests.
        The NPR also called for a threat and capabilities-based approach in
    the area of nuclear weapons. Specifically, the NPR called for a
    transition from a nuclear stockpile with large numbers of deployed
    warheads to a smaller stockpile augmented with a responsive
    infrastructure which would be capable of responding to emerging threats
    and to changes in the global security environment. This smaller
    stockpile eventually was targeted at 1,700 to 2,200 weapons by 2012. It
    is important to remember, however, that the development of a responsive
    infrastructure was intended to be an essential precursor to these
    reductions, to provide the confidence that pursuing these reductions
    would not harm our security posture, no matter what possible futures
    lay ahead.
        The subcommittee is interested to learn what progress is being made
    in developing this responsive infrastructure over the past 5 years,
    since the NPR. When I became the chairman of this subcommittee 2 years
    ago, a ``responsive infrastructure'' was defined in terms of meeting
    key performance metrics for the Department of Defense, such as the
    ability to design, develop, and field new capabilities within a certain
    number of months, or to resolve technical issues regarding the
    stockpile in a timely manner. I would note that the most recent
    ``Stockpile Stewardship Plan Overview'' (November 2006) includes
    guidelines for responsive infrastructure such as the following:
    ``support the current stockpile''; ``execute the Reliable Replacement
    Warhead program''; and ``provide opportunities for a smaller
    stockpile.''
        While I don't criticize the desirability of these ``guidelines,'' I
    believe that we need to continue to drive improvements in the execution
    of the nuclear weapons program through a set of measurable performance
    goals--agreed upon between the Secretaries of Energy and Defense. The
    program should also have defined goals for budget and schedule
    performance. It has been 5 years since the NPR called for a responsive
    infrastructure. Only in the past year did the Department of Energy
    embark upon an analysis of alternatives for what is now called
    ``complex transformation''. I hope to explore why it has taken 5 years
    to get to this point; what performance objectives are we laying out in
    order to judge the various alternatives; and, what cost objectives
    might be appropriate in order to make this nuclear enterprise run more
    like a business.
        I conclude by welcoming the call by many of my colleagues in
    Congress for a debate concerning the future role of nuclear weapons.
    But I would also remind my colleagues, and the public, that for over 5
    years now, we have been operating under a new strategic framework that
    seeks to adapt our strategic capabilities and deterrence doctrine to
    address the most pressing new threats of our time: terrorists and rogue
    nations armed with weapons of mass destruction. Under that framework,
    we have begun the drawdown of our nuclear forces to the lowest levels
    since the dawn of the nuclear age, and have begun to provide limited
    protection for our Nation and forces against ballistic missiles of all
    ranges. If we agree as a Nation--as I believe we do--that we will
    continue to rely on some number of nuclear weapons for our security,
    then we must also examine seriously the need to make sure those weapons
    are safe and reliable. Finally, if we are truly committed to reducing
    our reliance on nuclear weapons, then we must reach agreement on
    alternative long-range conventional strike weapons capable of thwarting
    the most dangerous threats to our security.

        Senator Bill Nelson. General Cartwright, now we are going
    to treat this as a conversation, so you just start off, but we
    are going to interrupt and ask questions. Thank you for your
    service to our country. Thank you for the leadership that you
    are giving. You are doing an outstanding job and that is well-
    noticed and we appreciate that.
        Senator Sessions. I agree.

     STATEMENT OF GEN. JAMES E. CARTWRIGHT, USMC, COMMANDER, U.S.
                           STRATEGIC COMMAND

        General Cartwright. Mr. Chairman, I would like to make this
    a conversation. I will just take a very few minutes at the
    front end to set the context for the conversation, but there is
    no way that my remarks will cover all the mission space, and I
    would rather have you take me where you want to go and then we
    can discuss it.
        But at the front end, as Senator Sessions alluded to in his
    remarks, the change in the strategy to acknowledge the fact
    that the threat has proliferated, that it is a very different
    character than what we faced in the Cold War, and that it is
    advantaged by the information age. The access to technology,
    the access to information, has proliferated. We are dealing
    with nation states that we can consider peers, we are dealing
    with what has been termed rogue nation states. We have
    extremist groups and we have terrorists.
        When you look across that spread of threat, we have to have
    a different strategy to deter that wide range of threat. The
    intent was to build a tailored strategy, to have a balance
    between offense and defense that would allow regional combatant
    commanders the flexibility to apply the appropriate deterrence
    in a credible way to each of the nations in their area, each of
    the threats and challenges that they face.
        As was stated by Senator Sessions, in the 2001-2002
    timeframe we entered into an agreement with the Russians to
    start to drastically reduce our nuclear stockpile and to start
    to move away from mutual assured destruction as the singular
    strategy that we were pursuing. 2007 is the halfway point for
    both us and the Russians. There were goals set for the halfway
    point. We have compared notes. We are both on track, ahead of
    schedule, and moving towards that 2012 target.
        Part of what 2007 was to do for the United States was to
    review the emergence of the other capabilities that would
    replace mutual assured destruction in the nuclear stockpile as
    we understood it. The key is understanding that our intent is
    to move to the smallest number of nuclear weapons necessary to
    ensure national security.
        The emergence of missile defense over the past year,
    particularly in light of the testing that occurred from North
    Korea on the 4th of July, has lent to ballistic missile defense
    a credibility and a capability that has been demonstrated now,
    that is having an effect globally. We are starting to be able
    to devalue things like short, medium-range and ICBMs in a way
    that we were not able to do in the past. You can see that in
    the embracing that is going on with our Japanese partners, with
    our South Korean partners in that theater, the things that are
    happening in Europe and the Middle East, and the partnerships
    that are beginning to develop around this collective defense
    capability against what is emerging as a key threat, which are
    the ballistic missiles.
        So to me that piece has started to mature at a rate that is
    commensurate with the drawdown of the nuclear weapons that we
    have experienced between 2001 and 2007.
        In addition, we talked about offensive capabilities. On the
    general purpose force side of the equation, the emergence of
    the J-coded weapons, the global positioning system (GPS)-guided
    gravity bombs, the new cruise missiles that have been fielded
    both from the Navy and from the Air Force, air and sea, have
    given us a capability that we did not have before. It has
    changed how we are using the force. Regional combatant
    commanders are today using bombers to do close air support, and
    do it credibly, in a way that we never would have imagined that
    those vehicles could be used, lending a new value to their
    capability.
        Many of the targets that we have held at risk with only
    nuclear weapons in the past we can now credibly hold at risk
    with conventional weapons. The one piece that is still an
    outlier for us and a challenge is prompt global strike weapons.
    The alternative conventional capability when nuclear is
    inappropriate or we have at least a choice between nuclear and
    conventional alternatives, and we can talk more about that.
        Senator Bill Nelson. General, go back on that statement
    just before. Give me an example of what can you do now with a
    conventional weapon that you used to have to do with a nuclear
    weapon?
        General Cartwright. We used cruise missile-delivered
    nuclear weapons to hold at risk integrated air defenses
    targets/weapons. We really do not need to do that with nuclear
    weapons any more. The conventional cruise missiles that we have
    are survivable, they are precise. They can address these
    targets. So we have been able to offload some of those targets,
    and that has allowed us to stay on track in the reduction of
    operationally-deployed nuclear weapons.
        Senator Bill Nelson. Give us an example of those targets.
        General Cartwright. Integrated air defenses? In the case of
    Russia, they have those along the coastlines. They are used to
    defend the country against penetrating bombers or other
    airborne type targets. Other countries have the same
    capabilities, whether they be large countries like China or the
    rogues like North Korea or Iran.
        So integrated air defenses have now a conventional way we
    would go at them, that renders the use of a nuclear weapon
    against that target as possible, but we have a choice. It may
    be that you do not want to use a nuclear weapon in that case.
    It may be proximity to a border of a friendly nation. It could
    be just the inappropriateness, of wanting to control escalation
    driving it down rather than up. Any of those are reasons why a
    conventional warhead may be preferred in the strategy over a
    nuclear warhead.
        Senator Bill Nelson. You were starting with the RRW.
        General Cartwright. RRW. For us the nuclear strategy is not
    zero today. It is the least number necessary to ensure national
    security. If we are to have these weapons, the attributes that
    I would like to have on those weapons is that they be the
    safest they can be for the people who must handle them, both in
    the Department of Defense (DOD) and in the manufacturing of
    these weapons--the maintenance and upgrades, reviews, life
    cycle type activities.
        You also want to ensure that they are the most secure that
    they can be. In the 1950s, 1960s, and 1970s, we put these
    weapons together without the technologies that we have today
    for safety and security. We have learned a lot. We use this
    example of the 1966 Mustang. Sure, I would like to have it, but
    I am not sure I want to give it to my teenager or grandson
    without disc brakes, seat belts, air bags, et cetera.
        We have the technologies today readily available to make
    these safe and secure. The third attribute that we generally
    talk about in the RRW is reliability. The more reliable, the
    lower the number against any given target that we have to send
    to that target, number of times we have to revisit that target
    with either a manned or an unmanned presence. That helps us
    draw that stockpile down.
        But I think the fourth piece here that is often missed is
    that the RRW offers the opportunity to completely change the
    way we manage operational and technical risk. By having this
    warhead, we have the opportunity to move into the manufacturing
    processes that we have today versus the ones that we had in the
    1960s. In the 1960s we managed operational and technical
    surprise with inventory. We built more and more different kinds
    in order to ensure that if we needed it and we found a genetic
    flaw or something started to appear as a misoperating part in
    the complex, that we would just substitute another class of
    warhead.
        That led us to very large numbers of weapons in the active
    stockpile, but also, not addressed in the treaty, in the
    inactive stockpile. RRW allows us to move to component
    commonality, not to manage end items, but to manage it at the
    component level. We introduce technologies and diversity into
    the stockpile that allows us to drastically reduce the number
    of operationally deployed and inactive warheads. That probably
    will be the single greatest factor in reducing the number of
    these weapons that we have in our inventory. That attribute in
    and of itself is something worthy to consider for the
    committee.
        Senator Sessions. What was the first point you made on
    reliable?
        General Cartwright. Safe. We want to introduce those types
    of attributes, particularly in the package itself.
        Senator Sessions. I was thinking there was something before
    that.
        General Cartwright. Particularly in the package itself,
    using components that are safe to handle and if they are
    intruded upon are safe. The Navy has moved to this type of
    activity over the years. The Air Force is moving. Why not
    introduce it into the whole stockpile? We have ways of making
    these explosives safe.
        Senator Bill Nelson. By the way, I want to mention to you
    and Ben, we are going to try to put together a committee trip
    to the three labs. A good time for me is right after the 4th of
    July, when we are still in that break, July the 5th; go to
    Lawrence Livermore and then to Sandia and then to Los Alamos,
    where then we will get briefed on specifically what the General
    is talking about and where you can see it for yourself.
        Tell us, General, now, you have made a good case. Why are
    the Russians not going to think what we are doing is building
    more and powerful and therefore lessen their incentive to
    reduce?
        General Cartwright. One, we have publicly made the
    information available so that they can see what we are doing,
    and I have talks military-to-military to reinforce that
    activity. Two, we are not changing any of the delivery
    vehicles. We call this form-fit-function. It has to go into the
    same slot that it came out of, talking to the RRW. No new
    delivery vehicles, actually a great reduction in the number of
    delivery vehicles necessary for the stockpile.
        That has been relatively transparent. Too, we are really
    trying to follow the lowest risk pathway here. So one of the
    prerequisites is that we will do this without testing. So what
    we are doing has a legacy in the former test program, but it
    also has the characteristics in volume. The laws of physics are
    going to stay relatively constant for us. They understand the
    volumes we are dealing with, they understand the delivery
    vehicles. This is all stuff that we have verified in treaties
    in the past. They have a good understanding and we have a good
    understanding of each other's capabilities.
        I do not think that the issue of whether or not the physics
    package is distinctly different, is a wide variation on what we
    did, has really been an issue. We have made that transparent.
    We have done it both openly in the exchanges and privately in
    our military-to-military discussions.
        Senator Sessions. They are modernizing theirs already,
    regardless of what we do; is that not correct?
        General Cartwright. Yes, sir. They are more focused on the
    delivery platforms and how they are modernizing their delivery
    platforms. But they are working on their weapons.
        Senator Sessions. On the question of the NPR, it talked
    about responsiveness, responsive nuclear infrastructure. What
    does that mean, that we want to have a responsive nuclear
    infrastructure, and how does that affect what you are doing?
        General Cartwright. For me there are a couple of components
    here. We talked about modularity so that the infrastructure can
    produce just what it is as a module rather than an entire end
    item to solve the problem. That is point one. Point two is that
    it is an infrastructure--we learned this with the J-coded
    weapons on the conventional side, including artillery shells.
    If we could get to precision, if we could start to build these
    with a warm production line rather than building 100,000 of
    them, shutting down the factory, sending everybody home, then
    when it was time to build the next generation discarding all
    that we had and starting all over again with an infrastructure
    that was not warm, we had lost the intellectual capital and the
    manufacturing capabilities to do that.
        So what we are looking for is a warm industrial capability,
    one that takes advantage of the best practices in the civilian
    sector, one that acknowledges the fact that we are dealing with
    something that is very dangerous here. But if we keep those
    people trained and if we keep the production activity
    responsive, so that we are not doing it with inventory, we are
    doing it with the manufacturing capability to the best extent
    possible, then that becomes a responsive infrastructure.
        I think if you take the trip one of the first things that
    you will see is the attitude of the people. If you were there a
    year or 2 in the past versus what you would see today or in the
    near future, I think that Tom D'Agostino would tell you and I
    certainly will tell you as I go visit those labs, the attitude
    of those people see it and understand how to bring modern
    technology to their job, the security and the safety that that
    provides them, the environmental responsibility that is
    associated with it, you would see a very different attitude in
    those labs.
        [The prepared statement of General Cartwright follows:]

              Prepared Statement by Gen. James E. Cartwright, USMC

        Mr. Chairman and members of the subcommittee: This is my third
    opportunity to appear before you as Commander of United States
    Strategic Command. As such, let me first thank you for the time,
    attentiveness, and professionalism of your staffs as we have worked
    through some of the difficult challenges we face. The men and women of
    Strategic Command have performed superbly over the last year,
    demonstrating honor and dedication through long hours and deployments.
    We continued to transform our organization and capabilities over the
    past year, to better deal with traditional, irregular, catastrophic,
    and disruptive contingencies. As the national security environment
    continues to shift, we see other challenges on the horizon. We seek to
    adapt to the shifting national security environment by refining and
    fielding a ``New Triad'' of capabilities. Today I will outline how we
    intend to address the challenges we face and ask for your assistance.

                           CONTINUING TRANSFORMATION

        When we met a year ago, we talked of progress toward transforming
    Strategic Command in the midst of conflict. We spoke of new
    functionally aligned organizations designed to improve our operational
    speed and progress toward a New Triad of capabilities. Finally, we
    attached particular importance to the threat posed by non-state actors,
    the need to tailor deterrence and focus on effects rather than kinetic
    solutions.
        One year later, our functional components for intelligence,
    surveillance and reconnaissance (ISR), network warfare, global network
    operations, information operations, integrated missile defense and
    combating weapons of mass destruction (WMD) are each at or nearing full
    operational capability. In light of disturbing trends in the space
    domain, we further refined our components by splitting Joint Functional
    Component Command--Space and Global Strike into two individual
    components, focusing on global strike and integration, and space
    operations. These functional components are also progressing rapidly
    and producing significantly enhanced operational results. This year the
    Joint Information Operations Warfare Command completed the stand up of
    four joint centers to facilitate the planning and execution of
    Information Operations. The Joint OPSEC Support Center, Joint Mission
    Support Center, Joint Electronic Warfare Center and Joint Strategic
    Communications Support Center were established to improve Information
    Operations throughout the combatant commands. We made progress in
    restructuring our legacy nuclear deterrent force in compliance with the
    Moscow Treaty. On the less positive side, we have debated, but made
    little gain in, filling a gap in our prompt global strike capability.
    confronting traditional, irregular, catastrophic and disruptive threats
        The 21st century opened with a violent attack on American soil
    reminiscent of our experience more than six decades ago at Pearl
    Harbor. Unlike Pearl Harbor, the attack of 2001 was unique in one
    important way; military combatants were not involved. Civilians and the
    image of America were the targets of calculating and fanatical
    terrorists. Unlike the past, attribution for this attack would not be
    credited to a single state or alliance of states. Rather, it would be
    attributed to non-state actors who were empowered by their ability to
    operate and leverage technology in a flattened world and were not
    deterred by the military tools with which we deterred others for the
    last 50 years.
        As a world power, America's conventional and nuclear military
    capabilities remain second-to-none in deterring traditional threats,
    but our adversaries are predictably positioning themselves to avoid our
    strengths and exploit our vulnerabilities. Moreover, we live in a world
    in which traditional nation-states and alliances are asymmetrically
    challenged by adversaries who are unconstrained by geographic
    boundaries or internationally shared societal and legal norms.
        We are therefore preparing for immediate, potential and unexpected
    contingencies driven by these diverse adversaries who threaten America
    and its deployed forces, friends, and allies. These adversaries are
    pursuing the means for sudden and catastrophic strikes using WMD-armed
    ballistic missiles, or with little or no warning using WMD delivered by
    irregular means. They can also execute disruptive attacks in
    milliseconds using readily available, web-enabled communications and
    technologies from computers located anywhere on the globe.

                      SHIFTING NATIONAL SECURITY CHALLENGE

        While we continue to focus on the need to deter non-state actors
    through effects-based operations and remain vigilant with regard to
    those nations that possess large inventories of nuclear weapons, recent
    events in Iran, Lebanon, North Korea, and China, if unchecked,
    foreshadow future critical challenges.
        Daily cyberspace intrusions into civil, military, and commercially
    networked systems; the nuclear aspirations of Iran and North Korea, in
    open disregard of broad international opinion; the firing of rockets
    and cruise missiles from Lebanon and Gaza into Israel by Hezbollah and
    Hamas; the unannounced and irresponsible launch of North Korean
    missiles in the vicinity of Japan; and China's controversial launch of
    an anti-satellite missile, which has subsequently endangered routine
    use of space, demonstrate the range of challenges facing America.
        Today, we live in an Information Age where communication through
    cyberspace has forever changed and flattened our world. Free and open
    use of cyberspace has become an essential tool of the global economy
    and connects people throughout the world to each other. In fact, most
    Americans can no longer imagine a world without instant communications
    and the freedom to access goods, services, and information at will.
    However, not unlike the targets of pirates or train robbers of the
    past, America is under widespread attack in cyberspace. Our freedom to
    use cyberspace is threatened by the actions of criminals, terrorists,
    and nations alike. Each seeks their own form of unique advantage, be it
    financial, political, or military, but together they threaten our
    freedom to embrace the opportunity offered by a globally connected and
    flattened world. The magnitude of cost, in terms of real dollars
    dedicated to defensive measures, lost intellectual capital and fraud
    cannot be overestimated, making these attacks a matter of great
    national interest. Unlike the air, land and sea domains, we lack
    dominance in cyberspace and could grow increasingly vulnerable if we do
    not fundamentally change how we view this battlespace.
        Ballistic missile proliferation is a concern to free nations and
    will continue to pose a challenge to national security around the
    world. Introduction of nuclear weapons to the situation, particularly
    in the hands of regime leaders who openly seek to threaten or coerce
    their neighbors, presents an untenable threat to U.S. national security
    interests. It is clear that we must exhaust all possible diplomatic and
    economic avenues to solve the problem, but in the end, the DOD could be
    called upon to deter, reduce, or eliminate a critical threat to the
    security of America, its forces, friends, and Allies.
        America's defense strategy relies upon layers of capability that
    offer policymakers maximum political-military flexibility. The first
    layer is our emergent missile defense system. This system, when mature,
    will not be an impenetrable shield, but it will reduce the likelihood
    of successful attack. Successful tests have thus far demonstrated our
    ability to overcome technical challenges and we have gained
    international credibility, but more work remains as we turn our
    attention to defense of Europe and regional threats in Southwest Asia.
    Our second layer of defense is offensive strike--defeat the threat.
    Policymakers will first seek to employ forward deployed general-purpose
    forces, normally available in 3-5 days, given sufficient warning and
    range. Some conventional global strike forces are capable of reducing
    or eliminating threats within 1-2 days, but if the threat is sudden or
    fleeting our only existing prompt global strike capability employs
    nuclear ballistic missile systems. While America possesses dominant
    conventional capabilities second-to-none, we lack the capability to
    respond promptly to globally dispersed or fleeting threats without
    resorting to nuclear weapons. As good as they are, we simply cannot be
    everywhere with our general-purpose conventional forces and use of a
    nuclear weapon system in prompt response may be no choice at all.
        Intentional interference with space-based ISR, navigation, and
    communication satellites, while not routine, now occurs with some
    regularity. America's ever increasing appetite for space-based
    technical solutions for global positioning, communications, and weather
    among others, if not properly managed could become our Sword of
    Damocles--we must not become trapped in this vulnerable position. Space
    is now a contested domain where, without adjustments to our strategy,
    we may not be able to count on unfettered access to space-based systems
    should others persist in their course of developing counter-space
    weapons. Strategic Command believes that if we are to ensure our
    freedom to operate peacefully in space, we must rely upon a balanced
    acquisition strategy that employs a mix of some highly specialized
    space-based systems and other less elegant but more responsive space-
    based systems, and a global system of distributed terrestrial networks
    to help avoid this undesirable trap and properly mitigate the risk we
    currently face.
     adapting to the shifting security environment--fielding the new triad
        The diverse challenges facing America necessitate a mature strategy
    that reaches well beyond the blunt, cost-imposition approach of Cold
    War planners. This strategy must be equally adept at denying the
    benefits our adversaries might seek to gain and encouraging restraint
    even in conflict. We understand well that policy-makers will consider a
    range of options including diplomatic, military and economic. The
    Department of Defense (DOD) will in turn consider options spanning
    offense and defense, kinetic and nonkinetic, conventional and nuclear,
    as appropriate to the political-military context. Strategic Command has
    multiple roles to play in peacetime and conflict, not the least of
    which is providing sufficient intelligence, surveillance, and
    reconnaissance upon which decisionmakers will act. We must ensure U.S.
    freedom of operation in space and cyberspace, connectivity sufficient
    to exercise global command and control, integrated missile defense, and
    upon order, provide kinetic or nonkinetic global strike. Central to
    this strategy is the New Triad, which remains the foundation for our
    strategic approach to global deterrence.
        The New Triad is comprised of integrated offensive and defensive
    capabilities enabled by persistent global command and control, robust
    planning and intelligence, and a responsive defense infrastructure. The
    New Triad, when mature, will provide improved agility and flexibility
    in dealing with a wider range of contingencies. Our goals are to avoid
    undesirable competition, discourage proliferation, assure allies and
    deter aggression, particularly from WMD-armed adversaries, by
    maintaining sufficient strategic margin and flexibility vis-a-vis our
    competitors.
        While the vision of the New Triad concept is sound and we have made
    progress, the shift in the global environment threatens to outpace the
    implementation timeline. Our ability to seamlessly integrate defensive
    and offensive capabilities requires the more mature set of capabilities
    we are working toward. The remainder of this statement will outline the
    important roles of our various mission areas and highlight those needs
    we see as essential to meeting our goals.
    Intelligence, Surveillance, and Reconnaissance (ISR)
        Our Joint Functional Component Command--ISR has achieved full
    operational capability and begun adjusting our transactional model. Our
    current ISR capabilities and allocation processes were designed to
    focus on nation-states possessing traditional military capabilities and
    supporting infrastructure. Today we face adversaries who avoid our
    strengths and seek to attack through nontraditional means. Our ISR
    enterprise, designed to confront the former Soviet Union and the Warsaw
    Pact, is not optimized for either collection against, or analysis of,
    these new adversaries. Our initial assessment reveals that although we
    have increased the volume of collection, disparate sensor and
    requirement management procedures have resulted in redundant
    collections and system-wide inefficiencies, further stressing an
    overburdened ISR enterprise. These inefficiencies inundate our
    analytical teams with volumes of data, rather than providing the right
    information at the right time. As a Department, we effectively meet
    less than one third of our combatant commanders' warfighter information
    needs through these outdated systems. At the same time, the National
    Reconnaissance Office manages collection of national-level intelligence
    requirements for the Director of National Intelligence. We have
    invested significant energy in strengthening this partnership with the
    National Reconnaissance Office in an effort to streamline and better
    integrate collection management.
        Our objective is to optimize use of the Department's ISR resources
    by eliminating requirements and collection redundancy, streamlining the
    process to deploy ISR assets, and conducting genuine assessment of
    those operations. Our goal is an efficient global ISR enterprise,
    focused on achieving persistent collection capabilities against legacy
    and emerging threats through enhanced global sensor management of U.S.
    and coalition capabilities. We seek your support to improve our global
    situational awareness, and analytical capability to model and simulate
    the system of collection systems, spanning national, DOD, and coalition
    collection. Enhanced situational awareness and modeling and simulation
    capabilities will advance our ability to more effectively employ the
    assets we possess and move us closer to fully exploiting the data we
    collect.
    Integrated Missile Defense
        Because the threat posed by the proliferation of ballistic missile
    technology and cruise missiles is serious, a credible missile defense
    capability is now an essential element of America's national security
    strategy. Even at this early stage of maturation, missile defense
    systems influence our adversaries' perception of the economic and
    political cost they must incur to pursue ballistic missile
    technologies. While missile defense as a defensive shield is important,
    its value as a dissuasive force or deterrent is proving far greater.
        Our integrated ballistic missile defense program had an excellent
    year. Within a 90-day period we successfully intercepted ballistic
    missiles at low and high altitudes; in mid-course and terminal phases;
    and, in endo- and exo-atmospheric environments. We increased the
    numbers of our AEGIS tracking and engagement ships, ground-based
    interceptors in Alaska, and gained confidence through testing and
    deployment of the Forward-Based X-Band-Transportable and Sea-Based X-
    Band radars to Japan and Alaska respectively. At the same time,
    Sentinel radars and Avenger Air Defense systems participated in a
    combined Northern Command-North American Aerospace Defense training
    exercise in July 2006 to test our ability to rapidly deploy sensors and
    joint air defense systems to defend key assets against cruise missile
    attack.
        The July 4, 2006, North Korean missile launches spurred a limited
    operational activation of the Ballistic Missile Defense System (BMDS)
    and, as a result, helped us streamline our plans, tactics and
    procedures. We learned that the BMDS, procedures, and personnel
    performed well, and demonstrated a credible operational missile defense
    capability for homeland defense. An initial investment by the North
    Atlantic Treaty Organization in construction of a BMD command and
    control system along with growing interest by countries throughout the
    world in hosting both radar and interceptor bases are testaments to
    this credibility. Japan has accelerated and expanded its cooperation
    program with the United States for ballistic missile defense, and South
    Korea recently committed to developing short-range ballistic missile
    defenses. We expect discussion of forward deployment of radars and
    interceptors in Europe to continue with our Allies as attention on the
    emerging threat in Southwest Asia grows.
        As we move forward in the next year, more work remains. We must
    integrate air and cruise missile defenses with our growing ballistic
    missile defense system. Continued progress also requires further
    research, development, test and evaluation of individual components and
    end-to-end testing to validate sensor and shooter integration.
    Partnering with the Missile Defense Agency and the other DOD Service
    Components, we expect to further evolve the BMDS by adding new elements
    to the integrated sensor network. These elements will include cruise
    missile defense capabilities and extant intelligence collection sensors
    that will contribute to our situational awareness and overall
    integrated missile defense capability. In addition, the first two Space
    Tracking and Surveillance System satellites will be placed on orbit to
    demonstrate our ability to protect avenues of approach that can't be
    protected by other means. We also plan to increase the effectiveness of
    our system by improving target discrimination capability through
    integration of advanced algorithms in the Forward-Based X-Band-
    Transportable and Sea-Based X-Band radars.
    Information Operations
        We made progress in growing Information Operations Capabilities
    into core military competencies. We will continue to develop these and
    related Strategic Communications planning capabilities to ensure that
    all Joint Force Commanders gain and maintain the information advantage
    over our adversaries throughout the entire spectrum of regional and
    trans-regional engagement. As our capability centers, specifically for
    Electronic Warfare and Strategic Communications planning support, reach
    maturity, we will be able to provide trans-regional planning and
    integration support and strategic effects assessments responsive to the
    demands of the new Triad.
    Cyberspace Operations
        Earlier in this statement we noted that attacks in cyberspace are a
    matter of great national interest. Cyberspace has emerged as a
    warfighting domain not unlike land, sea, and air, and we are engaged in
    a less visible, but none-the-less critical battle against sophisticated
    cyberspace attacks. We are engaging these cyberspace attacks offshore,
    as they seek to probe military, civil, and commercial systems, and
    consistent with principles of self defense, defend the DOD portion of
    the Global Information Grid at home.
        The National Strategy to Secure Cyberspace describes cyberspace as
    the nervous system of our country and as such, essential to our economy
    and national security. It describes a role for all Federal departments
    and agencies, state and local government, private companies and
    organizations, and individual Americans in improving cyber-security.
    The National Security Strategy to Secure Cyberspace lays out a
    framework that seeks to deter our adversaries and assure our freedom of
    action in cyberspace. Fundamental to this approach is the integration
    of cyberspace capabilities across the full range of military
    operations.
        Strategic Command is charged with planning and directing cyber
    defense within DOD and conducting cyber attack in support of assigned
    missions. To date, our time and resources have focused more on network
    defenses to include firewalls, anti-virus protection, and vulnerability
    scanning. While generally effective against unsophisticated hackers,
    these measures are marginally effective against sophisticated
    adversaries. History teaches us that a purely defensive posture poses
    significant risks; the ``Maginot Line'' model of terminal defense will
    ultimately fail without a more aggressive offshore strategy, one that
    more effectively layers and integrates our cyber capabilities. If we
    apply the principles of warfare to the cyber domain, as we do to sea,
    air, and land, we realize the defense of the Nation is better served by
    capabilities enabling us to take the fight to our adversaries, when
    necessary to deter actions detrimental to our interests. Our
    adversaries seek to operate from behind technical, legal, and
    international screens as they execute their costly attacks. If we are
    to take the fight to our adversaries, we will need Congress' help to
    find solutions to penetrate these screens.
    Space Operations
        Freedom of action in space is as important to the United States as
    freedom to operate in the air and sea. In order to increase knowledge,
    discovery, economic prosperity, and enhance the national security, the
    United States must have robust, effective, and efficient space-based
    capabilities. The United States considers space systems to have the
    right to pass through and peacefully operate in space without
    interference, not unlike that of transit through international waters.
    Consistent with this principle, the United States views purposeful
    interference with its space systems as an infringement on its rights,
    and furthermore considers space capabilities, including the ground and
    space segments and supporting links, as vital to its national
    interests. Recent events make it clear others may not share these
    values. Platforms costing billions of dollars to replace and the lives
    of astronauts from many nations are now at risk from debris left by
    China's recent ill-advised anti-satellite test.
        Historically, space situational awareness (SSA) was focused on the
    cataloging, tracking, and monitoring of objects in space via the space
    surveillance network. Today it is clear we must have better space
    detection, characterization, and assessment tools. We require
    capabilities that enable rapid threat identification and attribution,
    facilitate a defensible architecture and provide fundamental shifts in
    space awareness. To this end, Strategic Command has created the Joint
    Space Operations Center (JSpOC) to ensure a more focused global command
    and control of our space operations and systems. We are in the process
    of colocating and consolidating the Space Control Center and the JSpOC
    at Vandenberg Air Force Base in California.
        We have provided, through the Secretary of Defense, a recommended
    plan for the establishment of an Operationally Responsive Space Office.
    The overall goals are to strengthen the Nation's space leadership and
    ensure that space capabilities are available in time to further U.S.
    national security, homeland security, and foreign policy objectives.
    Our recommended guidelines were to increase and strengthen interagency
    partnerships to ensure a focused and dedicated unity of effort.
    Interagency partnerships provide opportunities to jointly identify
    desired effects, capabilities, and strategies. Departments and agencies
    will capitalize on opportunities for dynamic partnerships--whether
    through collaboration, information sharing, alignment, or integration.
    To minimize the threat to our space capabilities now and in the future,
    we need continued support of programs that enhance our SSA, space
    protection capabilities, and satellite operations in order to preserve
    unfettered, reliable, and secure access to space.
    Global Strike
        The devastating attack in September 2001 made it clear that we must
    engage our enemies offshore, or suffer further damage at home. To do
    so, we require a robust mix of capabilities tailored to a wider range
    of potential adversaries and spectrum of challenges than yesterday. The
    DOD has aggressively pursued this wider range of capabilities over the
    last decade by pursuing a highly effective mix of advanced conventional
    systems designed to take the fight to our adversaries with sufficient
    precision to enhance the credibility of our warnings and effectiveness
    of our strikes.
        However, while the DOD deploys and when necessary employs these
    expeditionary forces around the globe, it is unlikely we can or will
    have forces in every place we need them at the crucial moment when we
    have an opportunity to deter or respond to an attack, be it
    conventional or otherwise. A timely response will be possible using
    these conventional forces if they are properly equipped and positioned
    in near proximity to the emerging threat. If our forces can't be in
    position to respond rapidly, it is prudent to have the ability to
    defeat attacks or eliminate high value or fleeting targets at global
    ranges rather than suffering the consequences of an attack. We have a
    prompt delivery capability on alert today, but it is configured with
    nuclear weapons, which limits the options available to our
    decisionmakers and may reduce the credibility of our deterrence.
        The capability we lack is the means to deliver prompt, precise,
    conventional kinetic effects at intercontinental ranges. Several
    analytical efforts are underway or have been completed to assess mid-
    term options. For example, Air Force Space Command is developing a
    promising concept for a continental United States-launched conventional
    strike missile, which capitalizes on the maneuverability and precision-
    to-prompt-effects offered by maneuvering flight technology to produce
    effects at global distances. Army Space and Missile Defense Command is
    actively working thermal protection and management solutions that can
    be effectively used across the range of potential advanced PGS
    solutions.
        Unfortunately, the threat we face is more virulent and arrived at
    our shores earlier than expected. Because the threat has outpaced our
    search for solutions, we have examined many plausible alternatives and
    believe a near-term solution to deploy a precision global strike
    missile within 2 years of funding is essential to adequately defend the
    Nation offshore. This near-term capability should be part of a larger
    strategy to explore, test and field other land, sea, or air-launched
    alternatives to produce effective mid (2013-2020) and long-term (2020
    and beyond) solutions.
    Combating Weapons of Mass Destruction
        For more than half a century we lived in a world in which the few
    major powers possessing nuclear weapons walked a cautious path of
    mutual deterrence. For years we have encouraged those nations retaining
    chemical and biological weapons to disavow them as the major powers did
    long ago. To its credit, Libya has raised its profile within the
    international community by divesting itself of WMD that did not and
    could not guarantee its security; it is too soon to know for North
    Korea.
        Strategic Command's role is to integrate and synchronize DOD
    efforts in support of national efforts to combat WMD, on a global
    scale. Strategic Command is therefore actively engaged with the
    national laboratories, the Director of National Intelligence, National
    Counterproliferation Center, National Nuclear Security Administration
    (NNSA), the Defense Threat Reduction Agency, the Department of Homeland
    Security, regional combatant commanders, and others to better
    coordinate, integrate, and synchronize our collective response to the
    threat. We provide support to Nonproliferation Treaty initiatives, the
    Cooperative Threat Reduction program, and the Proliferation Security
    Initiative. We recently completed a WMD Elimination Concept of
    Operations, and will soon activate a Joint Elimination Coordination
    Element to serve as the core of a Joint Task Force-Elimination, should
    such a force be required.
        We ask for your continued support in helping us build on the
    successes realized through programs like the Nunn-Lugar Cooperative
    Threat Reduction Initiative. Resources that enable us to scale the
    attributes of existing programs to a global level, will provide global
    combating WMD capabilities by building global partnerships, using a
    global perspective, with the tools and metrics to judge value, and
    allow individual or regional WMD interdiction and elimination by host
    nation-state process owners. This process focuses on enabling ``nation
    self help,'' where empowered nations are stakeholders and active
    participants in the fight to interdict and eliminate the threat of WMD.
    By participating with these nations, our actions reinforce their status
    as a sovereign state, elevate their standing, reinforce their status,
    and are a positive step forward for America as our partners develop and
    possess resident counterproliferation capabilities, providing advanced
    threat reduction and attribution forward from our shores while
    demonstrating a consolidated front to the threat.
    National Command and Coordination Capability
        The world is fundamentally more complex than it was when our
    current point-to-point nuclear command and control system was developed
    more than 50 years ago. This single-purpose aging command and control
    system, while adequate to meet our nuclear mission, is not adequate to
    meet our broader national objectives. As we seek to sustain the
    essential core nuclear command and control system, we see an
    opportunity to transform this 1950s Cold War capability into a
    government-wide national communications capability. To do so, we must
    take advantage of modern networked architectures.
        At the outset, our strategy was two-fold, first to sustain our
    legacy nuclear command and control system and second to expand its
    capability to address a broader scope of military challenges. These
    investments would better integrate all elements of national power and
    increase our ability to quickly respond across a broader spectrum of
    military threats. However, our national experience in Hurricane Katrina
    made it clear that America needed more and we expanded the scope of our
    effort to improve the Nation's ability to support civil authorities
    following disasters or other domestic events. The President has
    subsequently provided guidance to develop a robust, enduring, secure,
    survivable National Command and Coordination Capability (NCCC) that
    integrates our legacy nuclear command and control functions into a net-
    centric NCCC. In support of these objectives, we have developed
    partnerships with the Departments of Homeland Security and Justice, and
    Director of National Intelligence.
        The goal is to create a NCCC that not only meets national command
    and control requirements, but can become the versatile and stable
    backbone of a nationally distributed network to meet other important
    homeland security requirements. Through an integrated and adaptive
    approach, NCCC will enable a responsive, universally collaborative and
    virtual environment for all users. We are well on the way to realizing
    this vision. Actions to date include modernizing our airborne
    components, distributing our ground components, and increasing network
    capacity.
    Safety, Security, and Reliability of the Nuclear Stockpile
        The NNSA and the DOD share responsibility for the safety, security,
    reliability, and effectiveness of the Nation's nuclear warhead
    stockpile and for the quality and responsiveness of the enterprise
    necessary to sustain it.
        During the last decade, our Nation invested in increasing our
    scientific understanding and extending the life of weapons designed and
    produced during the Cold War. To date, these efforts have successfully
    ensured the reliability of our weapons without the need to conduct
    nuclear tests. While this strategy has served the Nation well, we
    recognize the current path of indefinitely relying on legacy nuclear
    designs refurbished through a series of life extension programs entails
    accepting significant future risks and potentially large costs, to
    reliability/performance, safety, security, and responsiveness points of
    view. For this reason, we support a Reliable Replacement Warhead (RRW)
    program as the best path forward to improve nuclear weapon safety,
    security, and reliability and advance our goal of the lowest possible
    stockpile levels consistent with national security.
        The 2001 Nuclear Posture Review described a need for a responsive
    production infrastructure, capable of responding to a strategic
    surprise, as part of its comprehensive nuclear strategy. The
    combination of the RRW program and responsive infrastructure investment
    are key elements of our overall strategy to further reduce our nuclear
    warhead stockpile to the lowest level consistent with national security
    requirements and move the Nation from an inventory-based to a
    capability-based risk management strategy. As the comprehensive
    strategy for the nuclear enterprise matures, the RRW program will
    replace extant nuclear warheads with increasingly modular and
    interoperable warheads that are safer, more secure, and highly
    reliable, as one element of a broader strategy to reduce our reliance
    upon nuclear warheads and more aggressively reduce our non-deployed
    stockpile. RRW designs will incorporate a broad suite of enhanced
    safety and security features that cannot be attained through the life
    extension process. Modularity and interoperability remain top
    warfighter priorities for the RRW concept. These attributes will
    significantly increase the operational flexibility and responsiveness
    of the nuclear weapons stockpile and improve our ability to introduce
    new technologies and respond to technological and/or geopolitical
    surprise. We ask for your continued support of the RRW program as an
    integral part of the Nation's comprehensive strategy to meet national
    security requirements and encourage Congress to continue investing in
    the transformation of our aging nuclear infrastructure; it is a key
    element in the sustainment of a credible nuclear deterrent for the 21st
    century.

                                   CONCLUSION

        United States Strategic Command is engaged in a wide-ranging
    campaign to provide support to all elements of the DOD, assure our
    allies, dissuade undesirable competition, deter our adversaries, and if
    called upon to defend our Nation and defeat our enemies. We take this
    role very seriously and today present you with carefully thought out
    recommendations. Once again, thank you for your time, insight, and
    attentiveness to our views.

        Senator Bill Nelson. To Ben and Jack: Any questions while
    we are on this RRW? Then we will move on to other topics.
        Senator Ben Nelson. Thank you.
        General Cartwright, as we realign our nuclear capabilities
    are we or are the Russians together with what we are doing
    mixing the message we are sending to Iran and North Korea? In
    other words, are we giving them an argument against what we are
    asking them to do, and that is to denuclearize at a time when
    we are realigning our nuclear capabilities?
        General Cartwright. Certainly a fair question. We have
    tried to be as transparent, and the Russians have also tried to
    be as transparent as possible. We are reducing the stockpiles
    in ways and in measures that are far greater than anything we
    have ever done in the past, moving in a direction that retains
    the minimum number possible, and demonstrates the responsible
    stewardship of safety and security of these weapons, making
    sure that they are only used for the appropriate mission.
        Senator Ben Nelson. So you think the transparency of what
    we are doing will not send a mixed message, although we know
    they will jump on anything that they can? But we are not
    sending a mixed message because of transparency and what we are
    doing with the realignment?
        General Cartwright. I believe that we have taken all steps
    that we should and could to keep from doing that. You always
    have to make sure that you go back and sample your audience: Am
    I getting through? Do you understand what we are doing? We try
    to do that regularly.
        That is why we held a 2007 review on both countries' parts,
    to make sure we were doing the right things, that the message
    we were sending was appropriate, and that people understood the
    direction we were heading.
        Senator Ben Nelson. Mr. Chairman, I have to go to the Rules
    Committee markup to make the quorum.
        I had one other question I would like to ask, General. We
    worked hard not that long ago to try to get the retrofitting of
    the Trident submarine so that we can have the non-nuclear
    capability on those submarines for what you described earlier,
    the more appropriate response or more appropriate reaction to
    what is going on. Are you still of the opinion that we ought to
    continue to do that and do you have any suggestions about what
    we might try to do?
        General Cartwright. Yes, sir. I know that we will go into
    this in more depth here later.
        Senator Ben Nelson. Senator Sessions and I teamed up on
    that.
        Senator Bill Nelson. We are going to go into that in
    detail.
        Senator Ben Nelson. Okay. I just want to continue to add my
    support for making the retrofitting of the Trident submarine
    for non-nuclear capabilities.
        General Cartwright. Thank you, sir.
        Senator Ben Nelson. Thank you. Thank you, General.
        Senator Bill Nelson. Senator Reed.
        Senator Reed. General, thank you. Just a few specific
    questions.
        Based on the reviews done to date and reviews that will be
    done by NNSA and the laboratories, you have confidence that the
    RRW design will be able to be certified without testing?
        General Cartwright. That is a priority in the activity. We
    have done the first step or the first phase in a developmental
    activity. This is kind of an exploration. To understand the
    risks, is there feasibility in moving forward? One of the key
    criteria was that we had to have high confidence that it would
    not require testing.
        This next phase that we are asking authorization for will
    get into more engineering detail to confirm that attribute.
        Senator Reed. If it becomes clear at some point that it is
    not possible to certify without testing, would you support
    terminating the effort?
        General Cartwright. I would come back to this committee and
    tell you why we got to that position and what the criteria
    were, what the detail was behind that, and then we would have
    that discussion. But it would be a criteria. We would have to
    seriously consider whether we would want to move forward at
    that point.
        Senator Reed. If successful, the RRW will be a significant
    improvement in safety, security, and reliability compared with
    the current?
        General Cartwright. Yes, sir.
        Senator Reed. Also, it will give increased confidence in
    the stockpile and enable substantial reductions in your view?
        General Cartwright. Yes, sir. If it is coupled up with the
    responsive infrastructure, then you have an opportunity here,
    particularly on the inactive side, where we have large
    inventories, to drastically reduce those inventories.
        Senator Bill Nelson. Convince us of that. For example, the
    life-extended W-76, is it going to be retired in favor of the
    RRW, what Jack asked?
        General Cartwright. The approach here is a three-phased
    approach. We have a life extension program associated with the
    76 and we have the inventory that is deployed. We will continue
    that life extension program with the intent of phasing it out
    as RRW comes on line and is deployable. So what you are trying
    to do here is not put all of your eggs in one basket that RRW
    will come on a certain date. You start the management of
    extending the life of the existing warheads. You carry that
    until you have confidence that the new weapon can replace it
    and then you phase out that life extension approach to
    business.
        The other piece that is important to understand is the way
    we tend to manage risk today. We have more than one warhead for
    each delivery vehicle. So if the 76 were to come up with some
    sort of flaw, we have other warheads that we could use instead.
    RRW allows you to do component replacement and get diversity,
    the ability to replace a component, rather than having to have
    an entire stockpile of a different weapon.
        Does that make sense?
        Senator Bill Nelson. Yes.
        Senator Reed. Just a final question, General. The Nuclear
    Weapons Council has decided to study the feasibility of the RRW
    and not to manufacture or deploy the RRW; is that correct?
        General Cartwright. That is correct. The next phase is an
    engineering level of detail on the feasibility.
        Senator Reed. Thank you.
        Thank you, sir.
        Senator Bill Nelson. Tell us about the cost. Are we going
    to actually be able to get some cost savings in here, even
    though we are going to develop the new weapon by retiring all
    of the life extension programs on the old ones?
        General Cartwright. This is always hard because what you
    add into the cost will drive this. But in the transition RRW
    from where we are, let us take the 76 as an example today, to
    the RRW, the intent was that the resources available would
    remain reasonably flat and we would just transition the
    resources from one activity to the next.
        Senator Sessions. By resources you mean money?
        General Cartwright. I do mean money, I do. I also mean
    infrastructure, people, and intellectual capital. All of those
    are in the equation. But it is the dollars and cents side of
    this equation.
        In the drawdown of several of the classes of weapons that
    we did between 2001 and 2007. We also took the savings on the
    DOD side and partnered with DOE to ensure seed money was
    available that was realized from standing down some of these
    weapons and delivery systems. That was to get this activity
    going, do the engineering work, start to understand a logical
    way forward, and present the case. So we have taken some of the
    savings from standing down weapons and delivery systems, used
    that in order to move forward here, but kept up the W-76 life
    extension program until we had a high confidence that we could
    replace it.
        So we are trying to stay within the resources that have
    been programmed and do that across the stockpile. Now, as you
    have to replace infrastructure, that is where we are trying to
    understand how quickly that can be done, and can you stay
    inside the programmed resources or do we have to come back and
    ask for additional resources.
        Senator Bill Nelson. Any more questions on RRW?
        Senator Sessions. One thing I would like to ask. In your
    position you have to think about these things. If we went to
    zero nuclear weapons, it seems to me that would encourage a lot
    of nations to the belief that they could in fact obtain
    military superiority over the United States by simply building
    a relatively modest number of nuclear weapons. Likewise, if we
    brought the number so low, even a rogue nation might see it
    within their grasp to be a peer competitor of the United
    States.
        Are those reasons why we need to be cautious about not
    going too low in our numbers and would you agree with that
    general philosophy?
        General Cartwright. I agree with the philosophy. I tend to
    look at it as how credible is your deterrent and credible to
    who. If on the conventional nonkinetic side, we are able to, as
    we have done, say with missile defense, start to be credible,
    then the level of requirement for nuclear weapons can be drawn
    down against some of the adversaries. Against adversaries, you
    may have a different equation where mutual assured destruction
    is a balance that they are comfortable with. This allows us to
    reach a point of credibility between two nations that would
    allow us to have a basis of dialogue, a basis of warning, an
    ability to know when the other has encroached and be able to
    say, hey, you are making me nervous, I am going to have to
    start posturing if you do not change.
        But what am I posturing with and is it credible? Today we
    still need nuclear weapons to balance that equation. The number
    we need is drastically less than it has been in the past.
        Senator Sessions. But a nation like Iran, when they
    consider their nuclear program, I am convinced at this point in
    history whether or not we are building a RRW, whether we have
    1,000 or 3,000 nuclear weapons, that is not the factor driving
    them to build their nuclear program. Would you agree with that?
        General Cartwright. I would agree with that.
        Senator Sessions. Thank you.
        Senator Bill Nelson. Senator Reed.
        Senator Reed. Thank you, Mr. Chairman.
        I just have a couple questions on the Moscow Treaty,
    General. Under the treaty, we have committed to have no more
    than 1,700 to 2,200 deployed nuclear missiles by 2012. But what
    are the number of reserve missiles that you are planning to
    meet that level of deployed missiles?
        General Cartwright. In the inactive or not deployed
    stockpile?
        Senator Reed. Yes.
        General Cartwright. I cannot give you the number, Senator.
    I will go find that for you. What we are hoping is that through
    RRW we can go well below that. I do not know that we were
    mandated to any level in those particular stockpiles. What I
    have been trying to say is that one of the values that you can
    get from RRW is to go after that part of the stockpile, which
    is still very large.
        Senator Reed. Do you have kind of a rough order of
    magnitude, like two to one, three to one, four to one?
        General Cartwright. Let me give you that for the record.
        [The information referred to follows:]

        The Moscow Treaty does not mandate any specific level for the
    reserve (not deployed) stockpile which consists of warheads for
    augmentation, reliability replacements, logistics spares, and
    surveillance. Today, the ratio of reserve stockpile warheads to the
    operationally deployed strategic nuclear warheads is greater than one
    to one. With planned weapon retirements and a responsive infrastructure
    facilitated by the Reliable Replacement Warhead Program, we are
    confident the ratio will be significantly less than one to one.

        Senator Reed. Okay, that is fair.
        Is it possible to reach these levels prior to 2012, the
    deployed levels, to reduce them to that?
        General Cartwright. Yes.
        Senator Reed. Is that contemplated?
        General Cartwright. We are certainly open to it. Part of it
    will depend on the engineering level work in RRW. Is 2012
    realistic for RRW to come on line, which is a challenge
    technically, but is it far enough along that we have gained
    confidence that we can start to reduce, inventories and have
    capabilities like missile defense come on board with a proven
    credibility as a deterrent factor to start to influence the
    deterrence equation?
        Those factors will all contribute to us being able to
    drawdown faster. We are ahead of schedule now. We are on a
    glide path that would put us before 2012 to make the deadlines.
    But we are watching each year and updating. 2007 is very
    important.
        Senator Reed. As I understand the treaty, the deadline
    comes in 2012 and then it expires in 2012. It is not a
    permanent treaty.
        General Cartwright. Right.
        Senator Reed. Would you be supportive of a permanent treaty
    or making Moscow permanent?
        General Cartwright. My crystal ball for 2012 is probably no
    better than anybody else's. I think we ought to go look at it
    as we approach that treaty, to look at what has emerged as
    capability, what are the threats, what are the threats to our
    Nation versus what are the threats to the Russians. The
    equation may change, but I think you want to keep a dialogue
    like this treaty going and you want to keep it, to the extent
    possible, binding and keep us on a glide slope towards the
    fewest number necessary.
        Senator Reed. We had a hearing last week which was very
    interesting. Some of the witnesses suggested that we really
    could go down to a deployed force of 500 missiles and a reserve
    of 500--warheads, rather. Others suggested 850 to 1,100
    deployed, much lower than the Moscow goal. Is that feasible or
    possible, desirable?
        General Cartwright. It is based on the assumptions. Again,
    what is the world that we are really living in, what is the
    ability of our infrastructure to say, gosh, the world was not
    what we thought it was going to be, we need to go up. I do not
    want to go in that direction, but are you comfortable that you
    could recover if you misjudged? That is the risk that you take
    as you get down to the small numbers.
        It does not mean that it is not plausible. It certainly
    does not mean that that number of warheads is not capable of
    being a deterrent. The question is how much risk do you want to
    take that you may have misjudged, and that ought to be a debate
    and a discussion.
        Senator Reed. Thank you.
        Senator Bill Nelson. Since the Moscow Treaty was more of a
    goal of 1,700 to 2,200 deployed nuclear weapons, are the
    Russians going to meet that goal by 2012?
        General Cartwright. They are certainly on a path, as we
    are, to be able to make it actually ahead of schedule if they
    judge the world the same way we are judging it right now.
        Senator Bill Nelson. Jeff, any more on this?
        Senator Sessions. A different subject.
        Senator Bill Nelson. Okay, what subject do you want to go
    to next?
        General Cartwright. I will go anyplace you want to go, sir.
        Senator Bill Nelson. Go ahead, Jeff.
        Senator Sessions. We spend a lot of money on ICBMs, on the
    aircraft capability, the triad, our basic triad of delivery of
    nuclear weapons. How do you see that as we drawdown these
    numbers? What capabilities is it wise for us to maintain and
    not weaken or not adjust much and what others may there be some
    capabilities of saving in?
        General Cartwright. I think in general the old triad of the
    nuclear forces is a sound construct.
        Senator Sessions. Explain the triad?
        General Cartwright. It is the combination of sea-based
    ballistic missiles launched from our nuclear-powered ballistic
    missile submarine, the land-based ICBMs that are launched from
    the missile fields in the United States; and then the bomber
    capability.
        Senator Sessions. The theory of that in the Cold War was
    that at least one of those capabilities would be effective to
    deter any attack on the United States.
        General Cartwright. Right. An adversary focused on one, you
    had the other two. We generally thought of the ICBMs, the
    ground-based, being the most responsive, available quickly if
    needed; the submarine-based as the type of weapon that had the
    most resilience and survivability, so if we were caught unaware
    they were survivable; and then the bombers gave us the
    flexibility of the man in the loop and the ability to go to the
    adversary and approach him from an air domain, so to speak.
        So we were approaching from three different ways, which is
    to some extent a cost-imposing strategy. It forces the
    adversary to defend in three different ways. That has been the
    philosophy as we move towards the new triad, which accepted the
    old triad but incorporated defensive capabilities and
    conventional capabilities in aggregate.
        So the question here is can we change the balance of the
    old triad as we draw down these weapons. We have reduced
    substantially the number of bombers committed to this activity,
    the number of sea-launched ballistic missiles that are
    committed to this activity, and the number of land-based
    ballistic missiles committed to the triad. Last year we took
    the last Peacekeeper out of the hole. That weapon system is no
    longer part of the inventory. We have reduced down to 500 the
    number of ICBMs and that is going lower here in the next month.
    We have made notification and we are going to drawdown there.
    The number of submarines committed and obviously then
    correspondingly the number of missiles associated with those
    submarines, the gravity bombs, the number of bombers that we
    have committed, the number of weapons associated with them,
    whether they be cruise missile in type or gravity in type, have
    all been reduced substantially.
        Senator Bill Nelson. Go ahead, Jack.
        Senator Reed. Are we going to join the debate about the
    precision global strike now?
        Senator Bill Nelson. Yes, we are going to.
        Senator Sessions. I think we should talk about that.
        Senator Bill Nelson. We are going to discuss every subject
    you want.
        Senator Reed. Despite the great efforts and enthusiasm of
    Senator Sessions and Senator Ben Nelson, at least, last
    Congress there was some concern about modifying the
    Conventional Trident Missile (CTM) to carry kinetic non-nuclear
    warheads. The Navy has $175 million in the fiscal year 2008
    budget request for CTM.
        This is a rear guard action perhaps. But anyway, rather
    than continuing this debate, does it not make some sense to
    look for alternatives to accomplish the prompt global strike
    mission other than putting conventional weapons on what is a
    nuclear platform at the moment? In that vein, would this be a
    more appropriate defense-wide account, to look at global, new
    ways to strike within your required short period of time
    without engaging in this debate about Trident? What is your
    opinion, sir?
        General Cartwright. The Trident modification was designed
    to be a hedge for a threat that we believed had emerged, to
    give us the time to develop more appropriate systems for global
    strike that could address any number of attributes that were of
    concern. In other words, one of the keys was ambiguity, being
    able to discern what the profile equated to, much as we have
    done with bombers and cruise missiles in the past and other
    types of delivery systems that had both conventional and
    nuclear capabilities.
        The intent with the CTM was to be able to emerge in 2 years
    with a hedge capability, hold that hedge capability until in
    particular Air Force and Navy were able to move forward with a
    program of record to give us the attributes with a global
    strike capability in the conventional arena that we felt were
    appropriate for that activity--speed, range, ambiguity, notice,
    all of the types of things that you would like to have, A; B,
    also be credible on the deterrence side of the equation in that
    they could hold targets at risk credibly and deter somebody
    from either pursuing a tactic such as using strategic depth to
    hide their resources or hide their offensive capabilities where
    we could not reach them with other than a missile or long-range
    prompt activity.
        The other piece here was to also start to impose on the
    adversary, just as Senator Sessions has alluded to here, a type
    of offensive capability that would force them to build a unique
    defensive capability in order to address that threat, much as
    the old triad had done with three different ways of attacking
    the problem.
        Can we move forward into the future field of options, as
    you say, to a more regularized, more appropriate global strike
    capability? We believe we can. We believe that the Navy and the
    Air Force are on a path to do that. They are working with the
    labs. They are working actually with the Army. The Army has
    some pretty interesting ideas in this area. Even though they do
    not intend to move into this area, they are helping us on the
    technical side.
        So we believe that could start to appear around the 2012 to
    2014 timeframe to replace the need for the hedge. Now, what we
    do get out of the hedge activity separate from putting the
    warhead on the missile, is the work necessary to do the
    technical research on heat management, navigation, warhead,
    design conventional warhead, development that would be placed
    on these longer-term programs. So there is a mixture in that
    $175 million between production type money which would move us
    on a path to in 2 years field the hedge and the science and
    technology or research and development necessary to field this
    next generation of capability.
        So can we split that apart? Can we do this differently? Can
    we discuss whether or not the threat has emerged and whether or
    not we need to do this with CTM or whether we can wait until
    2012? That is why we are here and in this debate.
        Senator Reed. Congress--and again, this was not an issue
    that was not without differences of opinion, but the conclusion
    was that this opens up the proverbial can of worms when you are
    putting a conventional missile on a Trident nuclear submarine.
    I do not think we dispute or debate the issue of trying to
    strike in a short time across the globe. I guess my sense is it
    would be better to try to accelerate these efforts you are
    talking about than having a hedge which could jeopardize the
    deterrence and send conflicting signals, not just to the
    terrorists who have a secret enclave someplace with weapons,
    but nation states that have missile systems that they are not
    going to put at risk or other assets they are not going to put
    at risk.
        General Cartwright. It is a judgment call. The regret
    factors associated with not having it today if a target,
    particularly a weapon of mass destruction, emerged and we
    wanted to get to it quickly and we had no other way, that is
    the extreme in the opposite direction.
        Senator Reed. I understand that. I do not want to belabor
    the point, but just to clarify in my mind. We have nation state
    adversaries with WMD which we use Trident submarines with WMD
    and other means, the triad, to deter and, if not deter, then to
    successfully retaliate. We are really talking about--and
    correct me if I am wrong--non-state actors.
        General Cartwright. No, sir.
        Senator Reed. Well then, or--give me a scenario that we
    would have to----
        General Cartwright. Let me, without going classified, there
    are many targets that are out of the reach of our bombers,
    conventional forces, strategic depth in large countries--the
    question would be, as an example, how many satellites would we
    be willing to lose before we went to a nuclear alternative
    because the only thing we have to reach those targets is
    nuclear.
        Senator Reed. But you are positing a situation where a
    nation state could engage in behavior like shooting down
    satellites deliberately.
        General Cartwright. I am only trying to say that it is not
    just the terrorists, a terrorist target, but it is a broader
    threat spectrum. This is why eventually we want to get to
    something that is easily understood and can reach out and start
    to deter those types of targets. The question is do we need a
    hedge between now and availability of a more regularized
    capability.
        Senator Reed. I know Senator Sessions wants to comment, but
    this goes to basic deterrence theory, and that is one of the
    advantages of dealing with a nation state is that you have
    other levers rather than a nuclear attack.
        General Cartwright. Yes, and you want to use all of them
    before you ever go offensive.
        Senator Reed. One of the issues and I think the context
    that this issue came up is in those cases where the adversary
    is nondeterrable. They have to be preempted.
        General Cartwright. I guess there is a class of targets
    exactly as you describe, where you would want to be preemptive
    and you do not necessarily want to escalate immediately to
    nuclear. There is also, on the other side of the equation, the
    desire to control escalation in a conflict that might have
    started, and in both cases you might add value.
        Senator Reed. Thank you.
        Thank you, Mr. Chairman.
        Senator Sessions. We had a good battle about that last
    year. First we had hearings on it, and I concluded that the
    concerns with the conventional Trident launched from an
    existing nuclear-capable submarine were not likely to be
    confusing or place us at risk. But I have to tell you, when we
    voted we did not win that vote. Senator Reed is correct.
        I had also discussed last year and over the last couple of
    years that there are alternatives that are in development and
    research today, and I know there could be a regret factor if we
    do not have this capability right now. But have you given any
    thought to accelerating and giving more emphasis to some of the
    alternatives that might allay the concerns of our colleagues
    that any launch would be misinterpreted as a nuclear attack?
    How far away? What are your thoughts about going in that
    direction? You have a good bit of money in there after last
    year's vote and after last year's election I do not think we
    are going to get any more votes this year, frankly. So what is
    the practical solution to this? There are alternatives, I
    think.
        General Cartwright. There are. First, I want to thank the
    committee for allowing us to have that debate. I think it
    informed a lot of us and a lot of those who we serve and
    allowed them to at least see and understand what the issues
    were. I may have made your life a little more difficult, but I
    think we served our constituency well by having that debate,
    and we ought to continue those kinds of debates.
        The Air Force and the Navy both have programs that they are
    embarking upon to bring us to a technical solution that is
    informed by last year's debate. They are much smarter about
    what is going to be, let us say, appropriate and what can we
    match technology with. The question now is could you make it go
    faster. I do not believe technically you could. You could throw
    more money at it, but I do not believe that you could
    accelerate the science that we need to have here. We are seeing
    steady good progress in reducing what we call technical risk as
    we move forward. But we are also opening doors in technology
    that we did not understand before and are now making themselves
    available to you, and I will let the Air Force and the Navy in
    their opportunity talk a little more about that.
        But there are opportunities now. I do not think you can
    accelerate this. I think you would be challenged to have an
    initial capability by 2012--other than CTM--and then start to
    move forward from that in a block approach to get us to where
    we want to go. I think you ought to let the programs lay out
    that technology.
        But a lot of the work that we did at the behest of this
    committee on bringing together the Army, the Air Force, the
    Navy, the national labs to start to focus on this problem,
    start to understand the technical challenges and match them up
    with what we were discovering in our dialogue has occurred over
    the last year and a half. That has started to move forward. So
    I think we have credible ways forward. We have to see, does
    that technology really mature at the rate that we think we can
    make it mature and do we have the right investment profile for
    all of the things that you will have an opportunity to take a
    look at.
        Senator Sessions. Just to sum up, I guess, I had expressed
    concern that maybe we should just try to leap ahead with the
    new technology, and politically we do not have the votes, it
    did not look like, in Congress to proceed. But I just would ask
    you, you are saying that in your opinion, based on your
    responsibilities, that you do need this before it is likely
    that this program could be completed, a new type weapons system
    that Congress would presumably accept is on line? Explain to us
    how deeply you feel about it, in short.
        General Cartwright. I believe that we ought to have a hedge
    capability until we can field a program of record, that is an
    entire program, whether it be Air Force or Navy or both, but a
    capability. I believe this threat has emerged, based on what
    you have charged me to worry about and to watch. That is why I
    was so passionate about this discussion last year. I am no less
    passionate this year. We have moved a year closer to 2012. How
    long and how quickly do you want to have this capability? It is
    a judgment call as to whether or not this threat is something
    we want to have a prompt global strike capability for now. Or
    we are willing to wait a number of years between 2007 and 2012
    to see a full-fledged capability fielded.
        Having what we would call a time to field of 2 years is
    still something you have. Even if we do not fund this year, in
    2 years if we waited a year and said, gee, we might have
    misjudged this, you say go and the Department of the Navy here
    along with us could field this in 2 years. Is that cushion, is
    that safety net, big enough or would you like it shorter or
    would you like to have the hedge fielded right now? That is the
    negotiating space--that is the wrong way to say it----
        Senator Sessions. If new technology were to come on in 2012
    and we approve this money for the Conventional Trident, when
    would the Conventional Trident be fielded?
        General Cartwright. Probably 2009-2010.
        Senator Sessions. So you have a couple years of padding
    there.
        I see targets that could occur. You could have maybe some
    sort of attack on our satellites ready to be launched; WMD, you
    could see intelligence that a nation was about to launch a
    missile that could be stopped before the launch; or terrorist
    cells and top terrorist leaders plotting an attack.
        There are a number of targets I think that are not
    academic, but could be very real, hopefully not, but could be
    very real. So that is why I supported this. But it is not
    faring very well at the moment. You need to know that.
        Senator Bill Nelson. Some of the flip side of those
    arguments are that, as Jack said, if a nation state were to
    suddenly start attacking our satellites that is an act of war,
    and that would bring into the full array of the defense
    posture. Then there are the questions that we need to
    understand the answers to about the alternatives to this as
    measured against the cost, because we do not really know the
    cost. Is it going to be $100 million a shot? Is it going to be
    $5 million a shot? What is it going to be?
        General Cartwright. For the future systems? For CT?
        Senator Bill Nelson. For the prompt global strike.
        General Cartwright. Oh, for prompt global strike.
        Senator Bill Nelson. Let me ask you on this CTM, would you
    want to locate this account in a military Service or in a
    defense-wide account?
        General Cartwright. For CTM, I would put it in a Service
    account, a Navy program. For the broader capability of prompt
    global strike, that might be more appropriate for a defense
    account.
        Senator Bill Nelson. Okay. Any more questions on this
    subject area? [No response.]
        All right. Shall we go to national missile defense? Is that
    all right with you?
        Senator Sessions. Okay.
        Senator Bill Nelson. Go ahead.
        General Cartwright. I had some opening remarks that
    addressed the missile defense capability. Let me just add a
    couple of comments to where I think we are. One, the testing
    has been very successful thus far. Two, the key issues that are
    in front of us, at least as a commander are expanding and
    bringing in the Southwest Asia threats and whether or not we
    want to have that capability, which we believe we are going to
    need, to devalue the proliferation of ballistic missiles in
    that region.
        The second, that is very important to me, is the expansion
    of the system beyond long-range ICBMs. We must address those
    threats that hold at risk our forward-deployed forces, our
    allies, and our friends. Those are the short- and medium-range
    ballistic missiles, things that Patriot, the Standard Missile
    (SM) 2 and 3 will be able to address, and Terminal High
    Altitude Area Defense (THAAD). Starting to bring and integrate
    that system together so that we do have an ability to have a
    collective defense with allies and the ability to have a global
    capability against short, medium, and the ICBMs. Those focuses
    I think are where we want to be heading as we move forward.
        We have a pretty good understanding of the science. We are
    demonstrating, particularly with the SM-3 and Patriot and
    THAAD, the broad range of capability of layered and collective
    defenses and sensor integration now on a global scale. We need
    to expand that out and bring credibility to it, allow the
    Services now to field these systems as indigenous organic
    capabilities, but allow them to mix and match without regard to
    Service lines. So an Aegis destroyer ought to be able to guide
    to terminal a Patriot and a Patriot battery radar or a land-
    based radar ought to be able to guide to conclusion a sea-
    launched missile.
        The reason you want to do that is most of our missiles far
    exceed the capability of their sensors, and so you want to take
    advantage of that range, broaden yourself out from just a point
    defense to an area capability. As an example, a THAAD battery
    can cover the entire peninsula of South Korea, one battery.
    That is the kind of area capability we need to bring to the
    equation to defend those forces against short- and medium-range
    ballistic missiles, which are the ones that are really
    proliferating out there.
        I will leave it at that.
        Senator Bill Nelson. Which one of you needs to go first? If
    you have a time problem go ahead, Jack.
        Senator Sessions. I am going to be here.
        Senator Reed. Let me just follow up on the major point you
    made, General, which is I presume it is the view of your
    combatant commanders and also you have done some joint
    capabilities force mix studies that it is these short and
    intermediate missiles, PAC-3, Aegis, BMD, that really more are
    needed than less; is that fair?
        General Cartwright. From an inventory standpoint?
        Senator Reed. Inventory standpoint.
        General Cartwright. Yes, but again SM-3 has mobility, which
    is a great attribute. Patriot has some mobility, but they are
    for terminal point defense. They have a very small footprint on
    the ground. So as you can see, whenever there is a conflict
    brewing people want more of them than exist, and you will never
    have enough to cover say the entire coast of a country or
    something. So you need an area asset. That is why THAAD is so
    important to us.
        But yes, in general short- and medium-range are the ones
    that are proliferating. They are the challenge right now.
        Senator Reed. That is what you are hearing from your
    combatant commanders?
        General Cartwright. Yes, sir. That is what they are asking
    for.
        Senator Reed. More PAC-3s.
        General Cartwright. Get us something like THAAD, that has
    this large area, because as you move to chemical munitions and
    things like that the ability to keep them away from the forces
    is critical to the commanders.
        Senator Reed. As we increase both the technology and the
    number of our missile defense capabilities, other countries
    will take notice of this. There is one area in particular, the
    Chinese, who are beginning to make improvements in their
    missiles. Do you believe that this will produce a reaction on
    the part of the Chinese? Will they feel that they have to
    increase their strategic capacities to negate our missile
    defense system? Not only our missile defense system, we are
    talking to the Japanese, we are talking to many others, where
    if it was sold in our own control they might be more sanguine.
        General Cartwright. There is generally an axiom, at least
    for the military, that you can only go so far on a defensive
    capability and you hit diminishing returns very quickly. You
    have to have it balanced with an offensive capability to be
    credible. The capability that we are fielding does not hold at
    risk a large nation state on the defensive side.
        There has been a substantial dialogue with the Russians
    about the European site. But 10 interceptors do not really
    change the calculus on the number of offensive weapons that a
    country like Russia has. But it is something that has to be
    discussed and to just sit silently is inappropriate for them.
    So we have to have this discussion, as we did in the Cold War:
    What makes you the most uncomfortable? Is it the time to react?
    Is it the proximity? We need to understand these issues and
    then adjust in a way that retains the credibility, but also
    allows them to understand what we are doing.
        Senator Reed. Let me ask a final question. You say in your
    prepared remarks we need a credible missile defense capability,
    and at what used to be called the theater missile defense area
    we certainly have made progress there in terms of the systems
    we have talked about. The national missile defense system is
    still not yet operational, I think. Is that fair?
        General Cartwright. We took it operational for the 4th of
    July when we had the Korean missile launches. The reason that
    we are not operational today in principle is that the command
    and control suite is one that is either configured for test or
    configured for operations, and we have elected until we have
    one that can do both, to bias that to test and development.
        Senator Reed. But at this point, it is not an operational
    system? It is still a testing system?
        General Cartwright. From that standpoint, yes. It has a
    certain number of hours to recall it.
        Senator Reed. The point I think is that it will become
    credible when it is fully operational; is that axiomatic?
        General Cartwright. Sir, I actually believe that it has
    become credible already, but it certainly will add to it when
    it is operational and people see that it does in fact stand the
    test of time.
        Senator Reed. Now, we went operational at the point at
    which the North Koreans--remind me, what did they do to make us
    go operational?
        General Cartwright. This was a launch. It occurred on the
    4th of July. We started to prepare for it much earlier than
    that. It was the Taepodong 2 along with some short- and medium-
    range missiles that they launched at the same time. So we had
    the system configured in an operational way based on an
    inadequate understanding of North Korea's intent and ambiguity
    in their actions.
        With the Russians and the Chinese, we generally exchange
    information about what we are going to do, we close down air
    space. So we know what is going on, and then if something
    deviates you can react. We did not have that kind of dialogue
    with the North Koreans. It left a lot of ambiguity in the
    discussion.
        Senator Reed. But we had enough intelligence that they were
    preparing for a test missile launch that the determination was
    to ``make this operational''?
        General Cartwright. Yes, sir.
        Senator Reed. But we are in a very strange world, where
    post-operational systems, once they are made operational, stay
    operational because you have done all the testing or most of
    the testing, or what you are going to do is little add-ons.
    Here we still have some significant systems to test, radars to
    deploy, to fully implement the systems.
        General Cartwright. As I testified last year, we have a
    thin line capability. In other words, we have a command and
    control, a weapon, and a sensor layer. What we are trying to do
    now is build redundancy into that system along with scale for
    both an east and a west capability. That is what we are focused
    on right now.
        At the same time, as you alluded to, the adversary is not
    sitting still. So there will always be an ongoing activity of,
    do I need to improve this? Is it justified to go in and spend
    the money to improve it because the adversary did something
    new.
        Senator Reed. Thank you.
        Thank you, Mr. Chairman. Thank you, Senator Sessions.
        Senator Bill Nelson. Jeff.
        Senator Sessions. General Cartwright, I remember recently
    we had a hearing and Senator Thune asked Admiral Keating, who
    would be the user or deployer, I guess, user of the national
    missile defense, do you have confidence in our missile system
    today, our defense system? He replied: ``I do have confidence
    in the system, Senator. We were prepared to deploy that
    system.'' That was on the Korean July 4 launch.
        He also noted about the September 1 successful test of last
    year after that, ``further reinforced my confidence in the
    system and I appear before you today as confident as I know how
    to be in the employability and efficacy of that system.''
        Do you share that view and do you believe that we have a
    system in place now that has really altered in some significant
    way our strategic capabilities?
        General Cartwright. I do. I have equal enthusiasm to this
    as Admiral Keating demonstrated. It has affected our
    adversaries. The dialogue has been in the open press, but also
    in the performance and the actions of our allies in
    contributing to and starting to develop indigenous capabilities
    and trying to find ways to integrate with our capability.
        There has to be some way to start to devalue particularly
    these short- and medium-range ballistic missiles. They are
    proliferating too quickly and they are removing the opportunity
    to have a debate because they act so quickly. There is no
    warning. You have to find some way to devalue this, and missile
    defense at least makes your adversary think twice before they
    would use those types of weapons.
        Senator Sessions. I think it is important both for our
    actual physical defense and to devalue a perceived advantage an
    adversary may have with a small number of missiles that might
    reach the United States. I think they could consider that they
    have a very substantial leverage, threat capability, and
    intimidation capability against the United States. That could
    lead them to be overconfident in what they do, to take actions
    that are reckless and could lead us into a situation of great
    peril, whereas if they have to know that there is a very
    realistic chance if they launch an attack it would be defeated
    and knocked down by a missile defense system, that they would
    be then further subject to very great attack in return, they
    can add the situation up.
        So I think that is good.
        I am very interested in and believe it is quite significant
    what is being discussed about a European site. Would you share
    with us your thoughts about that, what strategic benefit if we
    create a GMD site in Europe with, say, 10 interceptors?
        General Cartwright. The activity associated with Europe
    when you look at it in comparison to the Pacific activity, we
    prioritized the Pacific first and we built our capability in
    the Pacific. History will only tell what effect it really has
    had in the theater and how much of it was negotiation versus
    posture versus a credible defense, credible offense, but what
    is occurring in North Korea is not something that any of us
    would have predicted. What has occurred amongst our allies in
    using missile defense as a credible way to deter combat rather
    than encourage it has been significant.
        Senator Sessions. You are talking about our Pacific allies?
        General Cartwright. The Pacific. So the question is can you
    take those attributes and move them to Southwest Asia, Europe,
    and is there a need for that? I would say that, particularly as
    you look at Iran, who is fielding and testing and flying short-
    and medium-range ballistic missiles with a desire to move on to
    the ICBMs and space, et cetera, and couple that with their
    ambitions for nuclear capabilities, that we have a significant
    threat emerging there. Iran is certainly already a threat to
    their neighbors, and on a path by their own admission to be
    able to reach intercontinental ranges.
        Do we wait until a threat emerges to put this capability in
    place or do we go now and see if we can start to influence it
    before it happens? To me this is significant. We ought to be
    trying to inhibit this activity sooner rather than later.
    Missile defense is but one venue by which we ought to be trying
    to do that, and certainly the Nation is approaching this
    through all of the elements of national power. But we have to
    bring this into check and get this into a balance that is more
    appropriate than the current path that we are on, which
    threatens neighbors and eventually brings WMD into the
    equation.
        Senator Sessions. The North Koreans attempted to send us a
    message on July 4. I have expressed before I hope the Iranians
    do not attempt to do that in Europe on Bastille Day or some
    such day, but it certainly got our attention as a people, the
    American people. I also believe that the same principles will
    apply in Europe as you suggested are applying in the Pacific.
        I have one other specific question, but you can go.
        Senator Bill Nelson. Just on this very subject, NATO has
    not decided that it wants missile defense of its population and
    territory, has it?
        General Cartwright. As a body it has not.
        Senator Bill Nelson. Which would be prerequisite for us
    locating such missiles in Europe?
        General Cartwright. In NATO, in a NATO environment, that is
    incorrect.
        Senator Bill Nelson. Is that correct?
        General Cartwright. That is incorrect per OSD Policy, NATO
    permission is not required in order to proceed with missile
    defense in Europe.
        Senator Bill Nelson. Tell me, does a national missile
    defense system, does it have to be operationally effective to
    be credible?
        General Cartwright. The balance here is interesting. If you
    are on a path that is credible, and we are a relatively open
    society, so people watch tests, they watch and openly debate
    whether things work or did not work, but as you gain momentum
    and credibility in your test program, you may well start to
    influence deterrence before you are operational. That has, to
    some extent, occurred with missile defense.
        There is more than one side to this equation. We had an
    adversary in this case who is positioned in the area where we
    were developing missile defense. They, around July 4, decided
    to fire off some missiles. We had capability, that was
    discussed very openly. The dialogue went back and forth. All of
    that has lended to credibility in deterrence ahead of the
    actual operational capabilities we intend to field, but
    certainly recognizes where they are going and that there is
    credibility in the vector that missile defense is on.
        Does that help you?
        Senator Bill Nelson. That is a fair statement. Now, in
    order to be operationally effective, what point in our testing
    do we have to reach before we know it is operationally
    effective?
        General Cartwright. I will let program managers speak to
    their side of the equation. From an operational commander's
    perspective, I want to know that we have a dedicated command
    and control system that is always available, along with a
    sensor and weapon grid that is available and does not have to
    be taken off line for large periods of time in order to do R&D.
    We believe we will reach that somewhere towards the end of this
    year.
        Senator Bill Nelson. We are going to get into detail on
    this with General Obering, but from what you have observed do
    you have the confidence in the system through the testing that
    has occurred thus far?
        General Cartwright. Both for the short- and medium-range
    forward-deployed capabilities, the SM-3, the Patriot, and as
    the THAAD starts to emerge, and very definitely with the
    ground-based interceptor system that defends against the long-
    range intercontinental, I, like Admiral Keating, believe that
    the test profile is on a positive vector, that we are very
    comfortable operationalizing that capability when we have the
    redundant command and control and sensor grids, which we should
    have this year.
        Senator Bill Nelson. But looking not at the layers--we have
    lots of layers that work. Looking at the rockets in the ground
    in Alaska, you as a combatant commander, do you think when they
    fire at an incoming ICBM if one were launched from Russia today
    that we would hit it?
        General Cartwright. One, it is focused on the rogue nation,
    so it is focused on a less sophisticated threat than Russia or
    China.
        Senator Bill Nelson. You are talking about North Korea.
        General Cartwright. Right.
        Senator Bill Nelson. If it were North Korea, we could hit
    it down with those other layers.
        General Cartwright. Not necessarily. It depends on the type
    of missile that we are going after here. With TD-2 and an ICBM,
    you are not going to have those capabilities with the shorter-
    range missiles. You are going to have to have the ground-based
    interceptor. The missiles that are in the silos in Alaska and
    California are going to have to be the ones that go after that
    type of missile.
        Senator Bill Nelson. You think in a less sophisticated
    system like North Korea that we could knock it down?
        General Cartwright. Yes, sir.
        Senator Bill Nelson. Do you think we could knock down a
    Russian ICBM?
        General Cartwright. I believe there would be a lower
    probability of engagement success against a sophisticated
    threat.
        Senator Bill Nelson. We just want to get your perspective
    as a combatant commander. We are going to grill General Obering
    about this, because what we have not gotten up to this point is
    accurate information about the testing regime of this whole
    thing. We want it to be successful, but we want to know that it
    is successful, not with some just hope that it is successful.
        General Cartwright. Hope is not a good strategy. It does
    not lead to a credible defense or deterrent capability. I agree
    with you, Senator.
        Senator Bill Nelson. I have never understood how you could
    deploy something that had not been completely tested.
        General Cartwright. We have done that many times to stay on
    the cutting edge of technology against an adversary. A
    different case would be the Joint Surveillance and Target
    Attack Radar System (JSTARS).
        Senator Bill Nelson. JSTARS, that is one thing, to get up
    in a platform, in a Boeing 707, looking down at a battlefield,
    which we did very successfully in the first Gulf War. It is
    another thing to hit an incoming warhead in outer space in a
    testing program.
        General Cartwright. It is incredible what they have been
    able to do, but between myself and Admiral Keating when he was
    North Command (NORTHCOM) and is now Pacific Command (PACOM),
    and Admiral Fallon at the time, working with this program,
    working with the people that work it, we believe that it can
    work.
        Senator Bill Nelson. The Chinese have shown us that they
    can hit a less challenging target now that they have done an
    ASAT. Tell us what you think about that?
        General Cartwright. The ASAT test by the Chinese, one, was
    not a surprise. This was their third attempt. What was, for us,
    impressive was that in three attempts they made significant
    changes each time and were able to come to a successful
    intercept on their third attempt. It was impressive science and
    the engineering that went into that activity to get them to
    that level of capability.
        Having said that, direct ascent ASATs in and of themselves
    are a relatively expensive and inefficient way to address a
    space threat. We came to that conclusion. The Russians came to
    that conclusion a while back. I personally believe that the
    Chinese will come to the same conclusion. But they have
    undertaken a very disciplined and comprehensive continuum of
    capability against space, our space capabilities, all the way
    from temporary and reversible effects, examples would be GPS
    jamming, things like that, communications jamming all the way
    through direct ascent ASAT. Eventually they will probably be
    looking at co-orbital, and then the one that you really worry
    about is introducing WMD into space on a missile.
        But they have demonstrated the capability across the
    continuum. On the lower end of the spectrum, they have not only
    demonstrated it; they have fielded it into their forces. To me
    that demonstrates, one, that they have a very comprehensive
    look at what they want to be able to do as a nation in their
    region. Does that require from our standpoint that we do in
    kind the same type of activity? In other words, do we need to
    now think about weapons in space and ASAT type capabilities, et
    cetera? We have the technical capability. My belief right now
    is, knowing what we believe we know about this threat after the
    demonstration, that it is premature to start thinking about an
    arms race in space. There are, as you said earlier, many other
    ways to address a threat. We do not have to have a space
    response to that threat.
        Now, having said that, I do believe it is prudent to
    improve our posture and situation awareness in space. Who is
    doing what, why are they doing it, where are they, attribution,
    a disciplined way to know when there is an anomaly going on in
    space, and be able to then challenge as to why it is an
    anomaly, and what is the intent behind the owner of that
    particular craft?
        Those are things that we have to spend some time on. We
    have been and I believe we are on a good path in that area.
        Number two is what do we need to do about the assets that
    we have on orbit that are associated with national security?
    What kind of defensive postures do we want to have for them,
    mostly associated with being able to recognize when they are
    being threatened, be able to take rudimentary passive type
    defenses--close shutters, open gates, turn off, whatever is
    appropriate. You are not going to move a very large satellite
    which, sir, is the size of a bus out there. That is not going
    to outrun a Jaguar that is coming on a direct ascent ASAT. But
    it can tell what is happening, particularly in the lower end of
    the spectrum in jamming and RF type activities, and in
    proximity, when something is near it that we did not intend to
    be near. It can alert us. It can start to give us an
    understanding of what is going on.
        Our first activity ought to be, gee, is this something we
    planned to have happen, is this something normal in the course,
    can we explain this? If not, can we react inside of the
    decision cycle of our adversary to safe that satellite and
    engage in something other than forceful response to try to stop
    anything that would harm that asset?
        I want to get to a point where we know what is going on out
    there and we have more choices than just the kinetic option.
        Senator Bill Nelson. The initial reports are that they will
    have the capability with enough production of these ASATs by
    2010 to basically knock out most of our satellites in low earth
    orbit. So you, as a combatant commander, look at alternative
    programs. We understand that. But what are you advising us that
    you need in order that we would not go blind from low earth
    satellites?
        General Cartwright. Prompt global strike.
        Senator Bill Nelson. What else?
        General Cartwright. I need the ability to change our sensor
    capabilities, from one of cataloguing to one that is proactive.
    It does not require new sensors. It just requires thinking
    about how you use them differently so that you are predictive
    in nature and can understand threats that are emerging rather
    than reacting.
        Senator Bill Nelson. The prompt global strike would give
    you the strike in order to do what? What, knock out the launch
    vehicle that they are going to launch the ASAT on?
        General Cartwright. There are any number of nodes in the
    system in order for them to be able to knock out satellites.
    There are sensor nodes, there are command and control nodes,
    there are certainly the launch nodes. Then there is the flight
    en route. Any of those nodes should be available and we ought
    to explore alternatives to stop a conscious strike that would
    take out all of our low earth orbit satellites, and we ought to
    apply all venues of our national power to intervene on all of
    those nodes rather than setting yourself up for just one silver
    bullet, so to speak.
        Senator Bill Nelson. Jeff.
        Senator Sessions. General Cartwright, just briefly on this
    I would like you to comment on the fact that the
    Transformational Satellite Communications System (TSAT) has
    been pushed back another year. We plan three AEH satellites and
    then we need the fourth satellite, which was going to be the
    TSAT. Do you believe, since there has been a delay in the TSAT,
    that we should proceed with an Advanced Extremely High
    Frequency (AEHF) satellite to be the fourth one to complete the
    coverage, or do we need to wait on the TSAT?
        General Cartwright. AEHF provides the Nation with those
    survivable communications that we need when we are stressed,
    when we are under attack or when other communications have been
    knocked out for whatever reason. As you can imagine, our
    appetite for communications and command and control has grown
    in this information age. So that constellation of satellites is
    critical to us. We cannot afford a gap in that capability.
        If the transition between what is believed to be the next
    generation, which is based in laser communications in space,
    which is this TSAT if that is going to be delayed, then we have
    to fill that gap. Whether that is a fourth AEHF that is exactly
    like three or whether it has some of the capabilities of TSAT
    and some of the capabilities of what AEHF-3 had is something
    that we ought to talk about, or whether we are not comfortable
    with the technical risk and we just build a clone of AEHF-3.
    The program managers have to convince me of the approach. But I
    as a commander cannot stand a gap in that capability.
        Senator Sessions. I am not exactly sure what the budget
    request calls for, but we are going to need to answer that
    question. For us it is the money now.
        General Cartwright. For you it is the money. For me it is
    the capability. I would be very uncomfortable with any kind of
    gap in that satellite's capability.
        Senator Bill Nelson. We have another panel that we are
    going to have to move to. Senator Thune, do you want to ask of
    General Cartwright or you want to ask in the next panel? We
    have three votes that are coming at 11:45.
        Senator Thune. I would prefer General Cartwright.
        Senator Bill Nelson. Go ahead.
        Senator Thune. Thank you, Mr. Chairman.
        I appreciate, General Cartwright, your being here. Homeland
    security obviously is our highest priority and so it is
    important that we act in a timely and coordinated fashion to
    deter and defeat threats.
        In the National Defense Authorization Bill for Fiscal Year
    2007, it was stated that an organizational structure for
    effective management, coordination, and budgeting for the
    development and procurement of unmanned systems, including an
    assessment of the feasibility and advisability of designing a
    single department or other element of the DOD to act as
    executive agent for the Department on unmanned systems.
        At the hearing last week I asked Admiral Keating, who is
    the Commander of NORTHCOM, whether he agreed that unmanned
    systems should be established under a single department and he
    answered in the affirmative. I would like to ask you that same
    question. Do you think that establishing a single department to
    act as executive agent for unmanned aerial vehicles (UAVs)
    would enhance coordination, promote unity of effort, and reduce
    the uncertainty and the overlap of responsibilities in the
    event of a natural or manmade disaster?
        General Cartwright. I am trying to distinguish here and
    just make sure that I get the right question, but this is
    talking agency to agency, DOD, Department of Homeland Security
    (DHS)?
        Senator Thune. Correct.
        General Cartwright. Okay. Yes, I would agree with Admiral
    Keating. It would help us in moving in a direction to be able
    to provide the services to whatever agency needed them and to
    be able to provide surge capability. The advantage of DOD,
    quite frankly, is that we can plan surge, ability to have
    platforms that are multifunctional and have multiple customers.
    DOD could use it, DHS could use it, Justice could use it. That
    capability then would allow the Nation to have depth. If each
    agency bought them they would buy the best business case, there
    would be no surge. You would buy exactly the number of hours
    you desired for Border Patrol or whatever you would use it for.
        Having a single agency provide that--STRATCOM opinion--
    would allow you to have the attributes that you laid out: unity
    of command and effort and all those other things.
        Senator Thune. I also posed the following question to
    Admiral Keating at last week's hearing and he answered the
    question affirmative. On March 5 of this year the Air Force
    Chief of Staff, General Moseley, sent a memo to each of the
    Services as well as the commanders of the combatant commands,
    which recommends that the Air Force be the executive agency of
    report medium and high altitude UAVs. I guess the question I
    would ask of you is, since the existing role of the Air Force
    is to conduct joint interdependent warfare from the air and
    through space and cyberspace, and since they have a proven
    record of providing vital air space and cyberspace capabilities
    for the Services, would the Air Force be the best choice to be
    the executive agent for fielding and integrating and operating
    UAVs?
        General Cartwright. I know the people that wear this
    uniform may not agree with me, but you are exactly right.
        Senator Thune. I suspect you are probably right, too. I
    appreciate the answer to that.
        I know you are a little pressed for time here, Mr.
    Chairman. But I wanted to ask as well: You said in your
    prepared testimony that we lack the capability to respond
    promptly to globally dispersed or fleeting threats without
    resorting to nuclear weapons, but then go on to say that your
    use of a nuclear weapons system in prompt response may be no
    choice at all.
        General, what challenges do you face in establishing a
    conventional ballistic missile that can take out a globally
    dispersed or a fleeting threat within minutes, and what other
    alternatives could we explore that would allow us to have the
    capability to respond promptly to globally dispersed or
    fleeting threats without resorting to nuclear weapons?
        General Cartwright. We have gone through the conventional
    prompt global strike discussion earlier, but to cut to the
    chase, there probably is not another capability that can reach
    out and touch, say, whether we go back to the ASAT example or
    we talk about terrorist camps or someone producing WMD. Our
    first choice would be conventional forces that were near the
    problem, and that should solve a large percentage of the
    activity.
        The next issues are those targets where we are not based in
    theatre. A lot of our adversaries make sure that they do not
    attack us where we are, so to speak. They go where we are not,
    look for our seams, things like that. So how many of those
    targets are there? Of what regret would they be if we allowed
    them to just have 5 or 6 days free time, so to speak? Which
    targets can we not reach no matter what we try to do
    conventionally, deep strategic depth in large countries, places
    and things like that, where you are not going to drive a bomber
    or a tank into?
        Those are the targets you have to focus on. Which of those
    targets can we get with the prompt global strike capability
    that we have today? That was the hedge of the Trident, to
    increase the credibility of deterrence and keep people from
    developing threats because we could hold them at risk, and
    where do we want to be in the future? What did we learn out of
    the debate last year? What would be the attributes of a prompt
    global strike system that does not over fly a third party, is
    much less ambiguous about what its capability is and where it
    is going, those types of questions.
        We believe that we can take those attributes that emerged
    out of this debate over the past year and bring them into a new
    system. The Air Force and the Navy are both proposing systems
    along those lines.
        Senator Thune. I appreciate that. I know that some of the
    ground has been covered already and I have a question, Mr.
    Chairman, that you may have already had him answer regarding
    space systems, but I will submit that for the record in the
    interest of time.
        So thank you, General, for your service and continue to
    fight the good fight. Thanks.
        Senator Bill Nelson. Jeff.
        Senator Sessions. Just briefly on Senator Thune's line of
    questioning. I think you are not leading combat ground troops
    in Iraq at this very moment and I think those uniformed
    personnel may not agree with you. In Fallujah right after the
    big battle there, the marines had a private contract with a
    company to provide their UAV coverage. This was of course
    several years ago.
        I have for 4 or 5 years really been concerned that the
    ground soldier is not getting sufficient resources and
    attention. We have this magnificent Global Hawk and other
    things that the Air Force has produced that are extremely
    valuable. I have no doubt that it is. But it also is by far the
    most expensive. So right now every day we have soldiers on the
    ground that could benefit from higher resolution, more and
    cheaper UAVs, and I am frustrated that they are not there.
        So as we go through this thing, Senator Thune, we do not
    want to be bureaucratic about who gets to be the lead and all
    of that, but there is a very real concern of mine that if we
    use this fabulous technology that we have we could produce a
    better UAV to help our Army and our Marines, who are in very
    difficult circumstances right now. That is just my two cents
    worth.
        General Cartwright. My comment referenced the Air Force
    Executive Agency question for medium and high UAVs, not to take
    away the tactical systems. The Services are going to be able to
    field their tactical systems. This is for the high altitude
    systems.
        Senator Sessions. I am not sure how much they do not--the
    same technologies. I have always been frustrated. We are
    getting these stovepipes and situations in which we are not
    having a common vision. So how we achieve that, I do not know.
    I do agree that it is an important issue. We need to move
    forward with it. The Air Force has gotten the lion's share of
    the money and that is not going to change. But I do want to be
    sure that the ground soldier at this point in our Nation's
    history is getting a lot of attention and their needs are being
    met.
        General Cartwright. You will never find me advocating
    against supporting the ground soldier or marine.
        Senator Sessions. I know.
        General Cartwright. By the same token, we have the paradigm
    of trust, that the definition has been over the years I own it
    and therefore I can trust it and that is the only way that I
    can accomplish my mission. I am saying, similar to what the
    Senator is saying, that we cannot afford that. We have to think
    of better integrated systems that give the ground combatants
    the capabilities and the information they need when they need
    it, where they need it, rather than dedicating to each
    individual transaction a dedicated resource. We just cannot
    afford that any more.
        Senator Sessions. My inexpert opinion is that we have not
    had sufficient, aggressive, committed attention to providing
    that resource to the ground soldier, and I would like to see us
    do better, however we come out on the issue.
        Senator Bill Nelson. We are going to have to move on. Just
    one other question. We have an experimental satellite up there
    called TACSAT-2 and the sensor has not been turned on. What is
    going on?
        General Cartwright. The sensors are both turned on. There
    are two sensors on that package. They have had challenges. It
    probably would be easier for me to take you to a closed session
    to discuss it.
        Senator Bill Nelson. Let us do that.
        General Cartwright. But it is a wonderful asset and both
    sensors are in fact operating now. They have not operated as
    quickly as we wanted them.
        [The information referred to follows:]

        The TACSAT-2 has two sensors and they were both turned on in
    January of this year. Currently both the imager and the signals
    intelligence payload are being calibrated and fine tuned. We expect the
    imager fine tuning and the target indicator experiment (TIE-signals
    intelligence payload) calibration to last into May, with both sensors
    to be ready for use during a combatant command exercise in mid- to
    late-June.

        Senator Bill Nelson. We would like to know the answer to
    that, so if you can get with us on that, I appreciate it.
        Thank you, General Cartwright, and would the next panel
    please come up. [Pause.]
        Your full statements are, of course, included in the
    record. As you can see how we are conducting this conversation,
    we do not want you to read any testimony. We are just going to
    have a conversation, and we are going to interrupt you with
    questions as we go. We are going to have to be mindful that in
    30 minutes three votes are called. So let us see how far we get
    on this. Senator Sessions and I want to welcome all four of
    you. So, Mr. D'Agostino, would you please start.

     STATEMENT OF HON. THOMAS P. D'AGOSTINO, ACTING ADMINISTRATOR,
     NATIONAL NUCLEAR SECURITY ADMINISTRATION, DEPARTMENT OF ENERGY

        Mr. D'Agostino. Thank you very much, Mr. Chairman, and I
    appreciate the opportunity to come talk to you today about RRW
    and our Complex 2030 vision. General Cartwright talked a lot
    about the RRW and the attributes and features that it can
    provide. There is an element that we probably should talk about
    a little bit more and that is the impact on our nuclear weapons
    complex, which needs to be brought out. I think it is very
    important for you to understand that.
        Our complex is a Cold War complex. It was largely put
    together over the last 50 years. In many cases we have
    buildings that we are still using that are over 50 years old,
    using production and manufacturing techniques that we used 50
    years ago. We know a lot more today than we did in the past
    about our impact on the environment, how to make things better,
    how to use materials and clean technologies that have less of
    an impact on the workforce.
        I believe we are really at a crossroads here. In addition
    to the transformational aspects of the warhead itself, which I
    would be very happy to answer questions about, there is an
    element that does not get talked a lot about, and that is what
    I would say the hidden legacy costs of doing things the way we
    used to do them. There is, to my understanding, a fairly
    significant sized budget in the Department of Labor to pay for
    and take care of our energy employees that have become sick as
    a result of work that they have done over the last 50 years. I
    think that budget is about $1.4 billion. We do not talk a lot
    about that, but it is important when we consider that when we
    look at the nuclear weapons stockpile of the future.
        My intent is not to replicate the past with respect to how
    we have done things. I want a much smaller nuclear weapons
    complex. I want a complex that recognizes and takes account for
    and designs in less of an impact on the environment. I want a
    complex that has a reduced impact on our workforce and
    increases workforce safety. I want, of course, all the
    attributes that General Cartwright talked about, and there are
    some classified details of that and I would welcome the
    opportunity to come brief the committee on those as well.
        I think when we factor all of those things in, and
    particularly the impact on our workers, that we will recognize
    that we are really at a crossroads here because the Nation, in
    order to maintain a deterrent--it is not only about maintaining
    warheads--it is about maintaining the people, the buildings,
    the tools, the techniques, to be able to respond and provide
    future governments the opportunity to move as the Nation needs.
        I do not know what is going to happen 20 years from now,
    but I do know I want to preserve the flexibility of Congress
    and those future Presidents to be able to respond.
        So as we go from 70 million square feet, where we were at
    the end of the Cold War, to the reduction to 35 million square
    feet in our complex, and I think we can actually reduce it down
    to about 24 to 25 million square feet with RRW. I think that
    drives us in the right direction--smaller, more efficient,
    cleaner, less of an impact on our workforce, and reduce those
    hidden legacy costs that our taxpayers are paying for right now
    and that we do not spend much time talking about.
        Without reading my oral statement, I think that is one of
    the points I am passionate about and that I would like to move
    forward with.
        [The prepared statement of Mr. D'Agostino follows:]

                Prepared Statement by Hon. Thomas P. D'Agostino

                                  INTRODUCTION

        Mr. Chairman, thank you for the opportunity to appear before you
    today to discuss nuclear weapons policies and programs. My remarks
    today focus on the Reliable Replacement Warhead (RRW) program and our
    planning for the future nuclear weapons complex infrastructure--we call
    it Complex 2030. This is my first appearance before this committee as
    the acting Department of Energy (DOE) Under Secretary for Nuclear
    Security and Acting Administrator for the National Nuclear Security
    Administration (NNSA) and I want to thank all of the Members for their
    strong support for critical national security activities.
        My testimony today will focus on the broad strategic context for
    our nuclear weapons program and, more specifically, describe how the
    experiences gained and lessons learned over the past 15 years have
    shaped where we are today and where we are heading in our efforts to
    ``transform'' the nuclear weapons stockpile and supporting
    infrastructure. I will do this by addressing the following questions:

             What is the role of nuclear weapons in the post-Cold
            War era?
             What was our original strategy for sustaining the
            stockpile and supporting infrastructure?
             Why do we need to adjust that strategy and why now?
             Where do we want to be in 2030?
             How is our RRW strategy consistent with
            nonproliferation and arms control?

         WHAT IS THE ROLE OF NUCLEAR WEAPONS IN THE POST-COLD WAR ERA?

        The policies guiding our nuclear weapons programs, and our
    strategic capabilities more generally, evolve from the 2001 Nuclear
    Posture Review (NPR), the follow-on Strategic Capabilities Assessment
    (which led to the dramatic reductions in the nuclear weapons stockpile
    approved by the President and announced in May 2004), the 2006
    Quadrennial Defense Review, and the efforts of the Nuclear Weapons
    Council leading up to the RRW design selection announcement earlier
    this month.
        The totality of this work has resulted in a number of conceptual
    breakthroughs in our thinking about nuclear forces--breakthroughs that
    have enabled concrete first steps in the transformation of our nuclear
    forces and capabilities. The recognition of a more dynamic and
    uncertain geopolitical threat environment but one in which Russia does
    not pose an immediate threat, the broad reassessment of the defense
    policy goals that we want nuclear forces to serve, and the evolution
    from a threat-based to a capabilities-based strategic force posture
    have enabled dramatic reductions in the nuclear force as well as
    reductions in operationally-deployed strategic warheads that were
    codified in the Moscow Treaty. This has also led to the deep reduction
    in the total nuclear warhead stockpile required to support
    operationally-deployed forces.
        In response to the new and changing global environment, the United
    States has appropriately reduced its reliance on nuclear forces.
    Precision conventional strike and missile defenses are playing a
    relatively larger role in our overall security strategy and help
    strengthen deterrence by providing the President with a broader range
    of response options that can convince adversaries that any aggressive
    plans would not succeed. But nuclear weapons are still an important
    component of our security. Moreover, as we continue to draw down
    nuclear forces, we intend to rely more on a nuclear weapons research
    and development (R&D) and manufacturing infrastructure that can respond
    in a timely manner and decisively to any new threats that do emerge.
    The concept that in an uncertain threat environment we can achieve
    defense policy goals by relying less on ``inventory'' and more on
    ``capability to produce'' was a profound outcome of the NPR.
        What then is the role of nuclear weapons? Why, after the Cold War,
    are we retaining any nuclear weapons at all? Why are we retaining the
    number we plan to retain? All are fair questions. The last one is, of
    course, a work in progress--the President has said that he seeks the
    lowest number of weapons consistent with our Nation's security and has
    moved aggressively to that end since taking office. He has authorized a
    reduction in the stockpile by nearly a factor of two since assuming
    office. (Details about this reduction, and the rationale for the size
    and composition of the remaining stockpile were provided in the
    classified May 2004 Report to Congress on the Revised Nuclear Warhead
    Stockpile Plan.) As a result of this and earlier reductions, the
    stockpile today is one-quarter its size at the end of the Cold War.
        Several nations currently possess nuclear, chemical, and/or
    biological weapons, and the means to deliver these weapons, and have
    given no indication they are willing to give them up. But the rationale
    for our own nuclear forces is broader. Quite simply, U.S. nuclear
    weapons:

             Deter nuclear and other weapons of mass destruction
            (WMD) threats against the U.S., its forces, and its allies.
            This implies an ability to hold at risk those elements of power
            that a potential adversary values. While we should not expect
            that our nuclear weapons will deter terrorist WMD threats, they
            can deter transfer of nuclear weapons and other WMD from rogue
            states to terrorist groups.
             Deter large-scale wars of aggression against the U.S.
            or its allies.
             Dissuade potential adversaries from trying to match or
            exceed our nuclear capabilities or from engaging in strategic
            competition. This requires that we maintain a combination of
            forces and infrastructure so that a future competitor seeking
            to gain some nuclear advantage would conclude that its buildup
            could not occur more quickly than the U.S. could respond.
             Assure allies of our continuing commitment to them and
            of our ability to make good on that commitment--the implication
            is that nuclear forces must be effective and reliable. This
            strengthens our ties with allies and also serves our
            nonproliferation objectives because those allies with the
            capability to develop nuclear weapons can continue to forego
            doing so, safe in the knowledge of the reliability of the U.S.
            nuclear umbrella.

        More broadly, nuclear forces are the Nation's ``insurance policy''
    for an uncertain future and remain a key element of U.S. national
    security strategy. As a result, NNSA must continue to assure the safety
    and reliability of the U.S. nuclear stockpile and, consistent with the
    President's direction to continue a nuclear test moratorium, do so
    without nuclear testing.

        WHAT WAS OUR ORIGINAL STRATEGY FOR SUSTAINING THE STOCKPILE AND
                           SUPPORTING INFRASTRUCTURE?

        What post-Cold War, post-nuclear testing strategy did we decide
    would best sustain the stockpile and supporting infrastructure? In the
    years following the end of the Cold War, budgets for nuclear weapons
    programs were in ``free fall''--funding was simply not available to
    sustain both R&D and production capabilities. A strategic decision was
    made to sustain and strengthen weapons program scientific and technical
    activities in order to ensure a future capability to certify the
    stockpile. While this was a reasonable decision given the limited
    resources at that time, in effect we mortgaged the present to ensure
    the future.
        That future was seen as science-based stockpile stewardship and
    life extension of our Cold War legacy warheads.
        When the U.S. stopped nuclear testing in 1992, it sought to replace
    this critical tool with a Stockpile Stewardship Program (SSP) that
    emphasized science and technology coupled with a vigorous experimental
    program as a means to understand better the physics and chemistry of
    nuclear weapons and their operation, and provided enhanced warhead
    surveillance tools so that we would have a much better chance of
    detecting the onset of problems in the stockpile.
        The goal of the SSP has been to predict the effects of aging in our
    warheads so that we could replace aging components before they degraded
    overall system reliability. The end of the Cold War provided this
    opportunity--our focus was no longer on a continuous cycle of fielding
    new warheads to provide new military capabilities, but on sustaining
    existing nuclear capabilities.
        We call this ``life extension''--the process of observing the aging
    of individual components of warheads and replacing them before they
    fail. Consider this challenge. Your 1965 Ford Mustang, which you
    maintain as a collector's item, has been sitting in your garage for 40
    years. You monitor it for such items as a clogged carburetor, corrosion
    in the engine block, battery discharge, etc. and you replace parts when
    you deem it necessary. But you don't get to start the engine and take
    it for a test drive. The trick is to assure that if you do need it
    right away that it would work with certainty. That's what we have to do
    in a nuclear weapons life extension program (LEP).
        By the mid-1990s we had embarked on a program to acquire the new
    tools of stockpile stewardship--advanced computing, high energy density
    physics capabilities, modern diagnostics facilities, enhanced
    surveillance, etc.--that would provide the best available alternative
    to nuclear tests to assure continued confidence in stockpile safety and
    reliability. Since then, we have made good progress in acquiring and
    employing these new capabilities.
        In 2001 when this administration took office, it thus inherited:

             A strong science base and surveillance program.
             A safe and reliable, but aging stockpile, with serious
            questions about the future.
             A plan for warhead life extension (but no new
            development programs underway).

        But, it also inherited a deteriorating or nonfunctioning
    manufacturing complex characterized by:

             Protracted underfunding
             Idled production capabilities
             Inability to produce plutonium parts
             Inability to produce/extract tritium
             Key facilities not being maintained
             Overly risk averse culture
             Aging workforce

        To be fair, some declining production capabilities were not needed
    at that time to support the stockpile. We were able, after several
    years delay, to rebuild components for the W87 LEP which commenced in
    the 1990s and completed in 2004. While we couldn't produce tritium, we
    didn't need to then because the large reductions in the stockpile at
    the end of the Cold War ensured adequate tritium reserves for an
    extended period for remaining warheads. Nonetheless, by not maintaining
    some key production capabilities, we ran additional risks in terms of
    not being responsive to unanticipated events.
        Despite problems with the production infrastructure, follow-on
    efforts to the 2001 NPR led to a substantial reduction in the size of
    the nuclear stockpile. But, because we couldn't produce warheads when
    and if they were needed--to hedge technical problems in the stockpile
    or adverse geopolitical changes--we still had to maintain a larger
    stockpile than desired.
        As a result, and in response to the NPR's call for a more
    responsive defense R&D and manufacturing infrastructure, we began to
    restore a balance in the overall program by:

             Continuing to fund R&D and aggressive stockpile
            surveillance,
             Implementing comprehensive stockpile life extension
            programs, and
             Restoring lost production capabilities and modernizing
            others as required.

        The NPR was instrumental in our receiving additional resources to
    restore this balance. Indeed, over the past few years we have made
    substantial progress including initial steps to achieve the Complex
    2030 vision for modernizing the nuclear weapons infrastructure.
    Specifically, we

             Restored tritium production and extraction from
            irradiated assemblies in TVA reactors,
             Restored key uranium operations at Y-12 in time to
            meet demanding LEP schedules,
             Recruited/retained strong workforce with the right
            skills for the mission,
             Are recapitalizing facilities suffering from years of
            deferred maintenance,
             Are implementing plans to ramp up to an interim
            plutonium pit production capacity of 30-50 pits per year at Los
            Alamos by 2012,
             Are reducing the number of sites with Category I/II
            special nuclear materials (SNM) and consolidating such material
            within the remaining sites,
             Are dramatically accelerating dismantlement of retired
            warheads, and
             Are streamlining and improving business practices
            including managing risk more effectively (e.g., recent success
            in increasing throughput at our Pantex facility).

        But we have a ways to go including defining the right path to
    restore our ability to produce plutonium components in sufficient
    quantity to support the long-term needs of the stockpile.

              WHY DO WE NEED TO ADJUST THAT STRATEGY AND WHY NOW?

        In 2003 we ``took stock'' of 10 years of the SSP and came to some
    important conclusions. Let me first reemphasize that the SSP is
    working--today's stockpile remains safe and reliable and does not
    require nuclear testing. This assessment is based on a foundation of
    past nuclear tests augmented by cutting edge scientific and engineering
    experiments and analysis including improved warhead surveillance. Most
    importantly, it derives from the professional (and independent)
    judgment of our lab directors advised by their weapons' program staffs.
        As we continue to draw down the stockpile, however, we have become
    concerned that our current path--successive refurbishments of existing
    warheads developed during the Cold War and to stringent Cold War
    specifications--may pose an unacceptable risk to maintaining high
    confidence in system performance over the long-term.
        Specifically, the directors of our national laboratories raised
    concerns about their ability to assure the reliability of the legacy
    stockpile over the very long-term absent nuclear testing.
        The evolution away from designs certified with underground nuclear
    tests, resulting from inevitable accumulations of small changes over
    the extended lives of these highly-optimized systems, is what gives
    rise to the concerns.
        While we are confident that the stockpile stewardship program is
    working and that today's stockpile is safe and reliable, it is only
    prudent to explore alternative means to manage risk in seeking to
    ensure stockpile reliability over the long-term.
        This is, in part, the impetus for our work on RRW: to ensure
    sustainment of the military capabilities provided by the existing
    stockpile, not develop warheads for new or different military missions.
        A second major driver was the realization after September 11 that
    the security threat to our nuclear warheads had fundamentally changed.
    The security features in today's stockpile are commensurate with
    technologies that were available during the Cold War and with the
    threats from that time. Major enhancements in security are not easily
    available via retrofits in the legacy stockpile.
        Specifically, the RRW program is examining the feasibility of
    providing replacement warheads for the legacy stockpile. Relaxing Cold
    War design constraints that sought maximum yield in a minimum size/
    weight package will allow design of replacements that are easier and
    less costly to manufacture, are safer and more secure, eliminate
    environmentally dangerous materials, and increase design performance
    margins, thus ensuring long-term confidence in reliability.
        RRW, therefore, also offers a means to transform to a much more
    efficient and responsive, much smaller, and, we believe, less costly
    nuclear weapons R&D and production infrastructure.
        In 2005, an RRW design competition was initiated involving two
    independent teams from our nuclear weapons design labs--Lawrence
    Livermore and Los Alamos, both working with Sandia. A competition of
    this sort has not taken place in more than two decades, and the process
    has provided a unique opportunity to train the next generation of
    nuclear weapons designers and engineers.
        Last November, the joint DOD-DOE Nuclear Weapons Council concluded
    that RRW was a feasible strategy to sustain the nuclear stockpile over
    the long term.
        In March 2007, the NNSA and DOD jointly announced the results of
    the design competition. The Lawrence Livermore/Sandia design was
    selected, and an integrated design team led by those two labs will head
    up joint efforts to develop a replacement warhead for a portion of the
    Nation's sea-based nuclear deterrent. I want to emphasize that this
    announcement addressed selection of a baseline design for RRW in order
    to develop a detailed cost, scope and schedule; it was not a decision
    to begin engineering development of a warhead.
        The need to start RRW now is driven by two basic reasons. First,
    the introduction of the RRW system provides the benefit of additional
    diversity in the Nation's sea-based nuclear force. RRW will replace a
    portion of W76 warheads deployed on the Trident SLBM system. That
    particular warhead comprises a very high percentage of our planned
    future strategic nuclear deterrent force under the Moscow Treaty and an
    even larger fraction of the force available on a day-to-day basis.
    Although we have not uncovered any problems with the W76, it is prudent
    to hedge against a catastrophic failure of that system by introducing a
    genetically-diverse warhead design into the SLBM force. Our ability
    over the next 15 years to produce new plutonium parts for the RRW is
    very limited--the sooner we start the sooner we can achieve this
    diversity.
        Second, the RRW effort has provided a critical opportunity to
    ensure the transfer of nuclear design skills from the generation that
    honed these skills with nuclear testing to the generation that will
    replace them. In 5 years, nearly all of that older generation will be
    retired or dead. Without this opportunity coming at this time (and not
    5 years hence), we would not be able to sustain and transfer the key
    knowledge and skills necessary to maintain the nuclear stockpile.
        Finally, our decision to embark on the path to an RRW does not
    result from a failure of the stockpile stewardship program, as some
    have suggested, but is a reflection of its success. The SSP has
    revealed the need to pursue this approach. Moreover, aggressive pursuit
    of the new scientific tools currently in use and being developed under
    the SSP is essential, not only to sustain existing warheads for as long
    as they are needed, but to our efforts to design, develop and produce
    replacement warheads that are safer, more secure, more reliable, and
    cost-effective over the long-term without the need for nuclear testing.

                        WHERE DO WE WANT TO BE IN 2030?

        We seek a Complex 2030 infrastructure that can respond on needed
    timescales to technical problems in the stockpile or emerging
    geopolitical threats. Such an infrastructure will provide, sustained
    long-term confidence in stockpile reliability, enhanced stockpile
    safety and security, a smaller stockpile with reduced likelihood of
    requiring future underground nuclear tests, excellence in weapons-
    related science and R&D, a modernized, fully capable, warhead
    manufacturing facilities with a production capacity of about 100
    warheads per year (not the 2,000 warheads per year capacity we had
    during the Cold War), and periodic exercise of key nuclear design
    capabilities that have lain dormant for two decades.
        With such an infrastructure we believe that we can achieve reduced
    DOE and DOD ownership costs for nuclear forces over the long term. A
    smaller stockpile means a lower overall cost to certify, remanufacture,
    refurbish, and dismantle warheads. A complex in which we consolidate
    nuclear materials in fewer locations will help contain ever-increasing
    resources devoted, post-September 11, to physical security. Finally, we
    will continue to reduce costs by more efficient business practices,
    including better management of the safety and security risks inherent
    to our work.

       HOW IS OUR RRW STRATEGY CONSISTENT WITH NONPROLIFERATION AND ARMS
                                    CONTROL?

        The RRW strategy itself has positive implications for
    nonproliferation.
        These warheads, by design, will not provide a new role for nuclear
    weapons or new military capabilities but will help sustain the military
    capabilities of the existing nuclear arsenal.
        Because these warheads would be designed with more favorable
    performance margins, and be less sensitive to incremental aging
    effects, they would reduce the possibility that the United States would
    ever be faced with a need to conduct a nuclear test to diagnose or
    remedy a stockpile reliability problem. This supports overall U.S.
    efforts to dissuade other nations from conducting nuclear tests.
        In fielding RRWs, we will not be increasing the size of the
    stockpile. These warheads will replace existing warheads on at most a
    one-for-one basis.
        Once a transformed production complex demonstrates that it can
    produce replacement warheads on a timescale in which geopolitical
    threats could emerge or respond in a timely way to technical problems
    in the stockpile, then we can go much further in eliminating spare
    warheads--further reducing the nuclear stockpile and, along with a host
    of other activities, demonstrating our commitment to Article VI of the
    Nonproliferation Treaty (NPT).
        Our near-term strategy also includes an increased rate for
    dismantling warheads that are retired from the stockpile. Warhead
    dismantlements ensure that stockpile and infrastructure transformation
    is not misperceived by other nations as ``restarting the arms race.''
        A safe, secure and reliable U.S. nuclear deterrent, credibly
    extended to allies, supports U.S. nonproliferation policy because
    allies that are confident in U.S. extended nuclear deterrence
    guarantees will not be motivated to develop and field their own nuclear
    forces. This nonproliferation role of U.S. nuclear weapons is often
    underestimated.
        Finally, we should not forget that the human capital and technical
    expertise built up over decades to support nuclear weapons programs are
    the same resources that support nonproliferation, arms control and
    threat reduction efforts. The linkages and synergies among these
    programs enhance overall security.

                                   CONCLUSION

        Let me conclude by summarizing my basic message:

             To meet its own security needs and those of its
            allies, the United States will need a safe, secure, and
            reliable nuclear deterrent for the foreseeable future. We will
            achieve this with the smallest nuclear stockpile consistent
            with our Nation's security.
             We see increased risk, absent nuclear testing, in
            assuring the long-term reliability of today's stockpile--i.e.,
            the legacy warheads left over from the Cold War--that undergo a
            continuous process of aging, and refurbishment of aging
            components, and consequently accumulate small changes away from
            the original tested and certified designs.
             Today's nuclear weapons complex is not sufficiently
            ``responsive'' to technical problems in the stockpile or to
            possible adverse geopolitical change.
             Our task is to work to ensure that the U.S. nuclear
            weapons enterprise, including the stockpile and supporting
            infrastructure, meets long-term national security needs.
             Our approach is to develop and field replacement
            warheads for the legacy stockpile as a means to transform both
            the nuclear stockpile and supporting infrastructure.
             These warheads will have enhanced safety and security
            features.
             We intend to accomplish all of this in a manner fully
            consistent with our obligations under the NPT and without
            requiring underground nuclear tests.

        I am confident that NNSA is headed in the right direction in the
    coming fiscal year. The budget request will support continuing our
    progress in protecting and certifying our Nation's strategic deterrent,
    transforming our nuclear weapons stockpile and infrastructure, reducing
    the global danger from proliferation and WMD, and enhancing the force
    projection capabilities of the U.S. nuclear Navy. It will enable us to
    continue to maintain the safety and security of our people,
    information, materials, and infrastructure. Taken together, each aspect
    of this budget request will allow us to meet our national security
    responsibilities during the upcoming fiscal year and well into the
    future.
        Our fiscal year 2008 budget request for weapons activities follows
    along with a statistical appendix that contains the budget figures
    supporting our request. I look forward to answering any questions on
    the justification for the requested budget.

        Senator Bill Nelson. General?

    STATEMENT OF MAJ. GEN. ROGER BURG, USAF, DIRECTOR OF STRATEGIC
        SECURITY IN THE AIR, SPACE, AND INFORMATION OPERATIONS,
                 HEADQUARTERS, UNITED STATES AIR FORCE

        General Burg. Thank you, Senator. It is a pleasure to be
    here representing the Air Force.
        You can see in our budget submission this year that there
    is a lot of attention paid to strategic forces. There is
    modernization efforts in the bomber force, in the ICBM force,
    with reductions being taken in both at the same time. You will
    see a significant amount of money applied to programs that
    might lead to a conventional strike capability to support
    General Cartwright's capability gap for prompt global strike.
    You will see some very significant reductions in the overall
    nuclear force, this year principally in the cruise missile area
    of our nuclear force.
        I will open with that and I am happy to answer any
    questions or discuss any aspects of that with the committee.
        [The prepared statement of General Burg follows:]

                Prepared Statement by Maj. Gen. Roger Burg, USAF

                                I. INTRODUCTION

        Mr. Chairman and distinguished members of the subcommittee, thank
    you for the opportunity to appear before you today to discuss our
    Strategic Nuclear posture.
        Your Air Force is fully engaged around the world fighting terrorism
    and insurgents in the global war on terror and fulfilling our roles as
    airmen for the joint team. Simultaneously, we stand prepared for rapid
    response to conflict around the globe as our Nation's Strategic
    Reserve. Air forces succeed when they anticipate and are allowed to
    shape the future strategic environment and develop the capabilities for
    the next fight. Air forces succeed when they remain focused on their
    primary mission as an independent force that is part of an
    interdependent joint team. We fly, fight, and dominate in three
    warfighting domains--air, space, and cyberspace--giving our Nation
    sovereign options to employ military force like no other nation.

                               II. WE ARE AT WAR

        Supporting U.S. Central Command and the global war on terror is
    just a portion part of what your Air Force does for our Nation's
    defense. Your Air Force has responded (or been prepared to respond)
    across the entire spectrum of conflict--from rapid humanitarian aid to
    major combat operations.
        Fighting and winning the global war on terror is our number one
    priority; however, it is important that we maintain focus on protecting
    our Nation from other potential enemies, both traditional and
    nontraditional. Currently, your Air Force has over 27,000 airmen, or
    about 5 percent of the Total Force deployed in support of global
    operations. We also have approximately 213,000 personnel, or about 40
    percent of the total force, on-line supporting the combatant commands
    (COCOMs) daily. This number includes airmen supporting Intercontinental
    Ballistic Missiles (ICBMs), missile warning and space control, the
    satellite control network, strategic bombers, Special Operations, and
    combat search and rescue forces. It also includes steady-state
    rotational forces performing a global mission but not necessarily under
    the direct control of a COCOM Commander or assigned to a particular
    area of operation. Examples include Air Expeditionary Force (AEF)
    postured continental U.S. fighters and theater airlift forces, base-
    level support troops, Air Force Major Command staffs, forces outside
    the continental U.S. assigned to Pacific Air Forces and U.S. Air Forces
    in Europe, global support, and strategic forces. Clearly airmen needn't
    be deployed to be employed.
        Today's strategic forces deliver uncompromising defense to our
    Nation, no differently than they have accomplished for 60 years. Since
    the beginnings of the Cold War, airmen continue to stand silent sentry
    around the clock to protect and defend our national security, and
    respond to any adversary should deterrence fail.

                         III. STRATEGIC NUCLEAR FORCES

    Air Force Intercontinental Ballistic Missiles
        As the Secretary of the Air Force stated in his response to
    concerns regarding the Minuteman III (MMIII) force reduction, ``the
    ICBM force has provided a rapid-reaction nuclear deterrent capability
    since the 1960s. Today, the MMIII is the Nation's only operational
    ICBM.'' During the 2005 Quadrennial Defense Review (QDR), the Defense
    Department agreed with U.S. Strategic Command (USSTRATCOM)
    recommendation to reduce the ICBM force from 500 to 450.
        The National Defense Authorization Act (NDAA) for Fiscal Year 2007
    mandated that the Air Force modernize MMIII ICBMs in the United States
    inventory as required to maintain a sufficient supply of launch test
    assets and spares to sustain the deployed force of such missiles
    through 2030. The Air Force has ongoing Life Extension Programs
    designed to extend ICBM service life beyond 2020. Additionally, the Air
    Force is currently analyzing MMIII missile and ground systems to
    determine what activities are required to sustain the force through
    2030.
        The Air Force plans to use an incremental approach to field an ICBM
    follow-on system that will address aging components while supporting
    COCOM requirements. The Office of the Secretary of Defense Land-Based
    Strategic Deterrent Overarching Integrated Product Team will review an
    initial system assessment in August 2007. The USAF Land-Based Strategic
    Deterrent Initiative will be addressed in the fiscal year 2010 Program
    Objective Memorandum (POM). The AF will complete the concept refinement
    and pre-Milestone A activities this year.
    ICBM Demonstration Validation
        Responsive infrastructure is a key component of the New Triad and
    serves as a backstop that allows us to reduce the nuclear arsenal
    without compromising our strategic deterrent posture. A comprehensive
    and aggressive demonstration validation program adds to the deterrent
    value of the force. The ICBM Demonstration Validation Program is at the
    core of our efforts to preserve our ballistic missile capability. It
    allows us to respond to emerging issues in the Minuteman fleet while
    identifying methods to reduce life-cycle costs and improve nuclear
    safety and surety. The unique capabilities exercised by this Program
    are essential to keep the Minuteman weapon system operationally viable
    through 2030.
    ICBM Life Extension Programs (LEPs)
        The MMIII ICBM is undergoing major LEPs of components from the
    nozzle to the nose-tip, extending MM III service life through 2020 and
    beyond. All programs are currently on budget and on schedule.
    Modifications include:

              1. Guidance Replacement Program: Replaces guidance set
            electronics on MMIII and improves reliability on the ground and
            in flight. A total of 440 sets have been delivered and the
            program will be complete with the delivery of the final 32
            guidance sets in fiscal year 2007.
              2. Propulsion Replacement Program: Extends booster life
            through 2020 by re-pouring stages one and two, and re-
            manufacturing stage three. A total of 311 boosters have been
            delivered. The program will be complete with the delivery of
            the final 56 booster sets in fiscal year 2008.
              3. Propulsion System Rocket Engine Program: Refurbishes seven
            components and assemblies in the liquid propulsion post-boost
            vehicle. A total of 72 kits have been installed and we will
            purchase 96 additional kits in fiscal year 2008.
              4. Safety Enhanced Reentry Vehicle: Enables MMIII to carry
            the more advanced Peacekeeper MK 21 Reentry Vehicle (RV) while
            retaining the powerful MMIII MK 12A RV multiple independently
            re-targetable RV (MIRV) capability. Retirement of the older MK
            12 RV is now possible, allowing us to avoid a costly $1 billion
            LEP. A total of 20 kits have been installed and we will
            purchase an additional 120 kits in fiscal year 2008.
              5. Environmental Control System: Modernizes cooling system
            equipment in the Minuteman Launch Facilities and Missile Alert
            Facilities. Five kits have been installed and we will purchase
            112 kits in fiscal year 2008. We are not planning to modify the
            facilities assigned to the 564th Missile Squadron at Malmstrom
            Air Force Base (AFB), MT as a result of the planned reduction
            in the MMIII ICBM force.
              6. ICBM Security Modernization Program: This three-part
            program consists of concrete enhancements, a fast-rising
            secondary personnel access hatch, and a Remote Visual
            Assessment (RVA) camera. This comprehensive program began in
            fiscal year 2004. Our fiscal year 2008 program includes the
            purchase of 100 fast-rising hatches which will allow responding
            Security Forces adequate time to deny access to our launch
            facilities. Our fiscal year 2008 program also purchases 60 RVA
            units. We are not planning to modify facilities assigned to the
            564th Missile Squadron at Malmstrom AFB, MT as a result of the
            planned reduction in the MMIII ICBM force.
    Helicopters
        The primary Air Force Space Command (AFSPC) helicopter mission is
    to provide our security forces with a continuous contingency response
    capability for the national ICBM complex. However, the Bell UH-1N is
    not capable of meeting current security requirements. It does not meet
    Key Performance Parameters for speed, endurance, range, or payload. UH-
    1Ns are not armed with offensive weapons, have no defensive
    capabilities or countermeasures, and cannot operate in a chemical,
    biological, radiological, nuclear (CBRN) environment.
        Our average Air Force UH-1N airframe is 38 years old. The original
    design life for this aircraft was 2,500 flying hours, although some
    aircraft in the inventory have over 13,000 hours. The UH-1N fleet is
    showing its age with fatigue-related cracks in the tail boom and is
    currently undergoing its second tail boom replacement enabling it to
    meet flight safety standards.
        The Common Vertical Lift Support Platform (CVLSP) is an Air Force
    effort to replace the UH-1N. The CVLSP was originally envisioned as a
    variant of CSAR-X. The Joint Requirements Oversight Council directed
    that the efforts be separated and then directed AFSPC to conduct a
    separate CVLSP Analysis of Alternatives (AoA). The CVLSP AoA is now
    complete and is in coordination at the Air Staff. CVLSP is sixth on the
    Air Force's Unfunded Priority List.
        The AFSPC team is considering four CVLSP options:
              1. CSAR-X platform
              2. Rebuild Air Combat Command service life extension program-
            modified HH-60G aircraft
              3. Develop a new aircraft
              4. Continue using the UH-1N aircraft
    Nuclear Cruise Missiles
        The Air Force analyzed current and future roles for nuclear cruise
    missiles during the 2005 QDR and the fiscal year 2007 Amended POM
    (APOM). The Defense Department issued guidance on 20 December 2005
    directing USSTRATCOM and the Air Force to study the nuclear cruise
    missile force structure, including the Air-to-Ground Missile (AGM) -86
    Air Launched Cruise Missile (ALCM) and the AGM-129 Advanced Cruise
    Missile (ACM). The guidance also directed us to build a retirement
    schedule for the missiles.
        The resulting study recommended that the Air Force retire all ACMs,
    reduce the ALCM force to 528, retire all excess ALCMs, consolidate the
    ALCM force at Minot AFB, and retain ALCMs in the inventory through at
    least 2020, possibly 2030. On 12 April 2006, the Deputy Secretary of
    Defense accepted the study recommendations. On 23 June 2006, the
    Commander, USSTRATCOM sent a letter to the Secretary of Defense
    supporting the study findings and advocating adoption of the ALCM/ACM
    force structure recommendations. The Joint Chiefs of Staff and National
    Security Council endorsed most of the study recommendations. On 17
    October 2006 the Secretary of Defense directed the Air Force to retire
    the ACM and reduce the ALCM fleet to 528 missiles.
        The Air Force intends to remove from service, demilitarize and
    destroy all ACMs and the excess ALCM missile bodies. The remaining
    nuclear cruise missile force will be consolidated at Minot AFB, North
    Dakota. As of this date, the Air Force has taken no irreversible
    actions as it seeks final congressional approval to demilitarize and
    destroy these missile bodies. These cruise missile force structure
    changes are part of a balanced force reduction that supports both
    Presidential direction to reduce the active nuclear stockpile, as well
    as the United States' obligation under the 2002 Moscow Treaty to reduce
    the number of operationally deployed strategic nuclear warheads to
    1,700-2,200 warheads.
    Strategic Bombers
        We have no plans to change the current force of B-1 and B-2
    aircraft. Our strategy for the future bomber fleet includes a three-
    phased modernization plan. The first phase of the modernization
    strategy includes plans for us to divest 38 B-52s while modernizing the
    remaining legacy systems. President's budget fiscal year 2008 funded a
    B-52 force structure consisting of 56 B-52 Total Aircraft Inventory
    (TAI). This inventory included 32 Combat Coded (CC), 11 Training (TF),
    4 test, and 9 backup B-52s. Following submission of the fiscal year
    2008 POM to the Office of the Secretary of Defense, Congress mandated
    that the Air Force ``not retire more than 18 B-52s (fiscal year 2007
    retirements) and maintain 44 B-52s as Combat Coded.'' The Headquarters
    Air Force, Air Combat Command (ACC), and the Air Force Reserve Center
    are working together to abide by this restriction while meeting the Air
    Force need to recapitalize aging aircraft. ACC is finalizing a plan to
    recode 11 TF B-52s and 2 test B-52 which would result in a total of 44
    combat coded B-52s. The 20 B-52s the Air Force plans to retire in
    fiscal year 2008 will be stored on the ramps at Barksdale AFB and Minot
    AFB in XJ status, which means that the Air Force will keep these
    aircraft in a serviceable condition but not in a common configuration
    (i.e. no capability upgrades) with the other 56 aircraft.
        The fiscal year 2008 President's budget reflects the Air Force
    position. A fleet of 56 TAI B-52s with 32 coded for combat meets Air
    Force requirements while supporting the need to recapitalize. The NDAA
    for Fiscal Year 2007 mandated that no funds ``be obligated or expended
    for retiring any of the 93 B-52H bomber aircraft in service in the Air
    Force as of the date of the enactment of this act until 45 days after
    the date on which the Secretary of the Air Force submits a Bomber force
    structure report prepared by the Institute for Defense Analyses.'' The
    Air Force expects the report to be finished by the end of 2007.
        The second and third phases of the modernization strategy include
    fielding a next-generation long-range strike capability by 2018 and
    fielding an advanced technology system with increased speed, range,
    precision, connectivity and survivability by 2035.
    Reliable Replacement Warhead
        Reliable Replacement Warhead (RRW) designs incorporate a broad
    suite of enhanced safety features which increases efficiency and cost-
    effectiveness as well as improved security features to prevent
    unauthorized use by terrorists, rogue nations or criminal
    organizations. These designs will replace 1970s-era technologies with
    modern components which will help minimize future safety and security
    uncertainties and can be managed using the improved computational and
    experimental tools developed by the Stockpile Surveillance Program. An
    all-RRW force is sustainable well into the future providing our
    combatant commanders with high confidence while managing risk.
        In November 2006 the Nuclear Weapons Council commissioned an RRW-2
    Phase 1 Study. The purpose of the year-long study is to define concepts
    for a replacement warhead to existing and future air-delivered systems.
    The study group is analyzing preliminary concept assessments,
    identifying delivery systems, recommending nuclear weapon trade-offs,
    and proposing an initial program schedule.

                                  IV. CLOSING

        We are building an Air Force prepared to dominate in the 21st
    century--strategically, operationally, and tactically. Air Force
    Strategic forces, the bulwark of our strategic deterrent capability,
    give us the means to ensure Global Vigilance, Global Reach, Global
    Power, and worldwide Expeditionary Combat Support. These capabilities
    are essential to the joint fight and are a critical component of the
    future joint force. The Air Force is committed to advancing strategic
    capabilities to fully support the joint team. In order to maintain our
    strategic dominance, the Air Force must recapitalize and also be
    allowed to divest itself of outdated, excess platforms. Divesting
    excess platforms will provide the means to shift vital funds to
    recapitalization and modernization of our Air Force and to maintain a
    strategic deterrent second to none. We appreciate your continued
    support in turning our vision into an operational reality. Our nation
    must invest today to ensure tomorrow's air, space, and cyberspace
    dominance.

        Senator Bill Nelson. Thank you.
        Admiral?

    STATEMENT OF RADM STEPHEN E. JOHNSON, USN, DIRECTOR, STRATEGIC
                SYSTEMS PROGRAMS, NAVAL SYSTEMS COMMAND

        Admiral Johnson. Good morning, Senator. It is a privilege
    to be here with you today representing the sailors and the
    marines and the men and women of the Strategic Systems
    Programs. Our biggest priority in the budget that we have
    presented to you is the life extension of the Trident weapon
    system to match that of the ship, which has already been
    extended. To do that, we will refresh the electronics and
    produce the rocket motors that we need to go to 2042.
        Thank you, sir.
        [The prepared statement of Admiral Johnson follows:]

                Prepared Statement by RADM Stephen Johnson, USN

        Chairman Nelson, Senator Sessions, and distinguished members of the
    Strategic Forces Subcommittee. Thank you for the opportunity to appear
    before you to discuss the Navy's efforts to maintain the credibility of
    our strategic deterrent forces. Strategic Systems Programs is
    responsible for maintaining our currently deployed Trident II forces
    and to develop capabilities which will support future requirements of
    our combatant commanders.
        The Navy's operational strategic deterrent fleet continues to
    provide a credible and affordable deterrent against nuclear war. Our
    Trident II weapons system, comprised of 14 submarines, 6 in the
    Atlantic fleet and 8 in the Pacific fleet, is maintaining a reliable
    sea based deterrent for our National leadership. Two of our submarines
    are undergoing engineering refueling overhauls (ERO). Along with U.S.S.
    Alabama (SSBN-731), which began her overhaul last year at Puget Sound
    Naval Shipyard, U.S.S. Alaska (SSBN-732) has commenced her ERO at
    Norfolk Naval Shipyard. Three SSGNs have returned to operation, U.S.S.
    Ohio (SSGN-726), U.S.S. Florida (SSGN-728) and U.S.S. Michigan (SSGN
    727). U.S.S. Georgia (SSGN-729), the fourth SSGN, is expected to
    complete her conversion in September 2007.

                               D5 LIFE EXTENSION

        Trident II (D5) Submarine Launched Ballistic Missile Life Extension
    (LE) program will redesign and replace aging missile electronics and
    guidance systems. Under this program, 108 additional missiles will be
    procured in order to meet long-term inventory requirements associated
    with the life extension of the Ohio class SSBN. Redesign of missile
    electronics and guidance components is in progress, and procurement of
    new D5 LE missiles begins in fiscal year 2008. The Trident II (D5)
    missile has been operational since 1990, providing the backbone of
    America's strategic deterrence. The low-rate production continuity
    procurement strategy has been extensively reviewed and approved by the
    Department of Defense (DOD) and Congress, and has been in execution for
    nearly 15 years.
        This procurement strategy has been proven successful, based on the
    demonstrated performance of the Trident II D5 weapon system. The Navy
    submitted a report to Congress in December 2002 that detailed the
    impact of alternative full-funded procurement strategies and
    recommended continuation of current production. Continued production of
    critical components represents the best balance of cost and risk to
    extend the life of the D5 missile.

                            NUCLEAR WEAPONS SECURITY

        One of our most important responsibilities is maintaining security
    over the ships and missiles in the Trident Program. Our budget submit
    includes elements to improve this security posture, including sensored
    perimeter fencing, waterfront intruder detection systems, and hardened
    security force facilities and vehicles, as well as a secure command and
    control network. The roadmap to implement these nuclear weapons
    security elements over the Future Years Defense Program was recently
    briefed to the Vice Chief of Naval Operations and Joint Requirements
    Oversight Council, and execution is underway.
        The SSBN Transit Protection Program extends the security umbrella
    to cover SSBNs transiting between piers and dive points.

                          RELIABLE REPLACEMENT WARHEAD

        The Navy and the National Nuclear Security Administration (NNSA)
    have recently started a joint program to design a replacement warhead
    for a portion of the Nation's sea-based nuclear weapons used in
    submarine launched ballistic missiles. This replacement warhead will
    not require underground testing. Other key aspects of this program
    include designing replacement warheads that are more efficient to
    manufacture, are safer and more secure, elimination of environmentally
    hazardous materials, and increased design performance margins, thus
    ensuring long-term confidence in reliability. The Nuclear Weapon's
    Council, a joint body including the Department of Energy and DOD,
    endorsed NNSA's recommendation for the Lawrence Livermore/Sandia design
    as the baseline for the RRW-1 program. However, several features of the
    Los Alamos/Sandia design are of great interest and they will be
    developed in parallel to the Lawrence Livermore National Laboratory
    effort. If sufficiently mature, these design enhancements will be
    incorporated into the baseline design at the appropriate development
    step.
        The selection of the Lawrence Livermore National Laboratory's
    baseline design was the first step toward detailed design of a reliable
    replacement warhead. NNSA and the Navy will now work together to
    develop a detailed RRW project plan and cost estimate for developing
    and producing the system. The RRW Project Officer Group, led by the
    Navy, will present the results of a design definition and cost study to
    the Nuclear Weapons Council for approval later this year, at which time
    authorization to proceed to detailed design and system development will
    be requested.

                       CONVENTIONAL TRIDENT MODIFICATION

        The Conventional Trident Modification (CTM) is the only near-term
    solution which can provide prompt, precise, conventional kinetic
    effects at intercontinental ranges. Given the requested resources, we
    can deliver the initial capability early in 2010, much earlier than any
    other alternative approach.
        CTM adapts the Trident II (D5) missile system to deliver
    conventional (non-nuclear) effects at global ranges. The Trident Weapon
    System and the D5 missile are well suited for this role by virtue of
    the long-range and payload capacity of the D5 missile, and the
    responsiveness and survivability of the Trident Weapon System.
    Responsive, survivable and persistent, CTM will defeat a diverse set of
    unpredictable threats without visible presence or risk to U.S. forces,
    and with little or no warning prior to strike. CTM implements the New
    Triad envisioned by the Nuclear Posture Review and is an evolution of
    deterrence toward conventional weapons. CTM concept of operations have
    been developed by U.S. Strategic Command.
        CTM will use existing D5 missiles, MK4 reentry bodies equipped with
    aerodynamic controls, global positioning system (GPS)-aided terminal
    guidance, and a conventional warhead. Advanced error-correcting reentry
    vehicles with GPS-aided Inertial Navigation Systems have been flight
    proven in a previous D5 test program. Total time from decision to
    weapons-on-target is about 1 hour. CTM technology can be rapidly
    developed and deployed within 24 months.
        The fiscal year 2008 funding request for CTM is $175 million. We
    have frontloaded the funding profile to provide the capability to the
    warfighter as quickly as possible. The bulk of the request is $126
    million for research and development to proceed with warhead
    development efforts required to achieve initial operating capability by
    early 2010. The additional $49 million is procurement funding that is
    required for reentry body component long lead materials and shipboard
    systems and trainer modifications.

                                      SSGN

        Three of our SSGNs have already returned to service and the fourth
    will rejoin the fleet in about 7 months. Operational tests are in
    progress and the first patrol is anticipated before year's end.
        These SSGNs are already demonstrating a transformational war
    fighting capability, carrying Tomahawk cruise missiles and supporting
    special operating forces. They have enhanced communication and improved
    masts and antennae for network centric operations. We are forging new
    relationships within the Department of the Navy and DOD in order to
    ensure that these submarines be used to maximum advantage in the war on
    terror.

                                    SUMMARY

        Mr. Chairman and distinguished members of this subcommittee, I
    thank you for your continued support of Strategic Systems Programs and
    our operational fleet in particular. Our strategic force remains a
    credible and reliable deterrent today. It is our goal to ensure that
    the Nation is protected through efforts to maintain the safety,
    reliability, and surety of our deployed systems. Thank you again for
    this opportunity to appear today to speak on behalf of Navy Strategic
    Systems Programs.

        Senator Bill Nelson. Mr. Green?

      STATEMENT OF BRIAN R. GREEN, DEPUTY ASSISTANT SECRETARY OF
       DEFENSE FOR STRATEGIC CAPABILITIES, DEPARTMENT OF DEFENSE

        Mr. Green. Thank you for the opportunity to be here today.
    I appreciate it. I will keep my opening remarks very brief
    also. We are in the fifth year of trying to implement the NPR,
    the recommendations of that review in 2002. Certainly from our
    perspective the strategic vision that was offered in that
    review remains valid. It outlined a very new and different
    strategic environment, a broader range of contingencies, a
    broader range of potential adversaries that would require a
    broader range of capabilities to address them, including
    offensive strike systems, both nuclear and non-nuclear,
    defenses active and passive, and a responsive infrastructure.
        I think over the past 5 years we have made some progress in
    trying to implement that vision. We have made progress in
    deploying missile defenses. We have made progress in reducing
    our nuclear force structure. We have initiated the RRW program,
    which I think is an important step.
        I think the significant gap that we see remaining, and
    there is more than one, but the most significant gap that we
    see remaining is the prompt long-range precision global strike
    mission. We have had a substantial conversation about that
    already this morning with General Cartwright. I will not
    belabor some of the points that he has made. I will be
    available to answer your questions.
        I think the one point that I would like to make is that the
    predominant concern that Congress has expressed is the
    ambiguity about the near-term solution that the DOD has
    identified, the conventional Trident modification, that might
    be misconstrued by Russia as a nuclear attack and they would
    respond in kind. Certainly from our perspective that risk is
    extremely low. We have a very long history with Russia. We have
    launched over 1,300 ballistic missiles throughout the course of
    the Cold War and the 1990s. They have never reacted badly to
    those launches. We have had a couple of instances where there
    has been a possibility that things could have been
    misconstrued. There was a launch of a rocket in the mid-1990s
    out of an area north of Norway that the Russians saw. They were
    concerned about it. They did not overreact.
        There is very little in the history and very little in the
    Russian reactions to past events and very little in the Russian
    doctrine that leads us to believe that ambiguity poses a
    significant risk. That said, we take all risks seriously in
    this area and we have developed a comprehensive set of
    confidence-building measures that we think would drive that
    already very low risk even lower.
        Senator Bill Nelson. How about China?
        Mr. Green. Without going into classified session, I do not
    think I can address China completely. But certainly at an
    appropriate time and an appropriate place, we would take into
    account Chinese sensibilities.
        Senator Bill Nelson. Do you have the same degree of
    confidence with regard to the Chinese response as you do with
    the Russians?
        Mr. Green. Absolutely. The Chinese nuclear forces are not
    on high alert. We have no reason to believe that the Chinese
    would overreact in this kind of circumstance as well.
        [The prepared statement of Mr. Green follows:]

                      Prepared Statement by Brian R. Green

                               I. OPENING REMARKS

        Chairman Nelson, Senator Sessions, and distinguished members of the
    subcommittee: I welcome the opportunity to describe our progress in
    transforming the Nation's strategic capabilities to meet 21st century
    security challenges. You understand the importance of this undertaking,
    and recognize the need to field a New Triad better suited to the new
    security environment. I want to thank the members of the committee for
    their support. Successful transformation of our capabilities will
    require a sustained partnership between the Department of Defense (DOD)
    and Congress.

         II. THE NUCLEAR POSTURE REVIEW AND THE ROLE OF NUCLEAR WEAPONS

        The Nuclear Posture Review (NPR) of 2001 put in motion a major
    change in the role of nuclear forces in our deterrent strategy. The NPR
    emphasized the need for a broader range of deterrent options and
    capabilities and established a New Triad composed of offensive strike
    systems (nuclear, non-nuclear, and non-kinetic); defenses (both active
    and passive); and a revitalized defense infrastructure--all supported
    by adaptive planning, command and control, and Intelligence,
    Surveillance, and Reconnaissance capabilities. The New Triad is
    intended to reduce our dependence on nuclear weapons and improve our
    ability to deter attack in the face of proliferating weapons of mass
    destruction (WMD).
        The rationale behind the NPR's findings remain valid: the Cold War
    Triad of nuclear strike systems is not adequate to support the full
    range of potential challenges and threats in the new security
    environment. An array of capabilities, including prompt conventional
    Global Strike, is ultimately necessary to address the new security
    risks the United States faces.
        That said, nuclear capabilities possess unique properties and
    provide credible military options to deter a wide range of threats,
    including WMD use. Nuclear weapons will continue to play a vital role
    in assuring allies of U.S. security commitments, deterring WMD threats,
    and holding at risk adversary assets and capabilities that cannot be
    countered through non-nuclear means. The U.S. will continue to honor
    its extended deterrence commitments to allies--a critical part of our
    national security and an important tool in our non-proliferation
    efforts. Extended deterrence, in turn, requires long-term confidence in
    the reliability and safety of the U.S. nuclear stockpile, and the
    Reliable Replacement Warhead (RRW) program is essential to achieving
    that end. In short, the United States will retain a credible nuclear
    deterrent at the lowest level of weapons consistent with U.S. and
    allied security. In transitioning to a New Triad, however, these
    weapons must be integrated with new non-nuclear strategic capabilities
    to provide an appropriate range of options.

                           III. IMPLEMENTING THE NPR

        We have made some progress in implementing the NPR over the past 5
    years:

              1. We have deployed an initial missile defense capability to
            protect our Nation, deployed forces, friends and allies, and
            are expanding that capability through evolutionary development
            and international cooperation.
              2. We are on schedule to reduce U.S. nuclear forces to 1,700-
            2,200 operationally deployed strategic nuclear warheads by
            2012. In addition, we have retired the last Peacekeeper
            intercontinental ballistic missile (ICBM), and DOD plans to
            retire 50 of the 500 deployed Minuteman III ICBMs and 38 of the
            94 B-52 bombers. We will use the savings to provide for a
            robust Minuteman III test program as well as to help sustain
            and modernize the remaining bomber fleet.
              The remaining Minuteman III ICBM force is being sustained
            through a life-extension program. The program will keep this
            element of the New Triad's offensive leg operational and
            effective into the foreseeable future. DOD is also examining
            future approaches to a follow-on land-based long-range nuclear
            strike capability.
              3. We have selected a lead national lab to conduct the
            engineering and design work on a RRW to replace a portion of
            our sea-based deterrent. The RRW program is vital to assuring
            long-term confidence in our nuclear deterrent and improving our
            responsive infrastructure.
              4. We are also making improvements to our intelligence and
            planning capabilities.

                               IV. GLOBAL STRIKE

        Our progress, however, has been uneven. We have not provided the
    broader range of conventional strike options that both the NPR and the
    Quadrennial Defense Review (QDR) called for in order to engage high-
    value or fleeting enemy targets located in access-denied areas; nor
    have we closed the gap in prompt, long-range conventional (non-nuclear)
    strike capabilities that the QDR identified.
        The 2006 QDR considered the new security environment and
    underscored the need for prompt Global Strike capabilities to address a
    range of challenges. The QDR identified the following objectives for
    Global Strike's operational and enabling capabilities:

             Provide the President and the warfighter with a
            broader range of conventional response options to deter
            aggression or coercion;
             Attack fleeting enemy targets rapidly;
             Fuse intelligence and operations to exploit time-
            sensitive intelligence;
             Find and precisely target enemy capabilities in denied
            areas;
             Deter, defend against, and respond in an overwhelming
            manner to WMD attacks; and
             Shape and defend cyberspace.

        DOD has strengthened its conventional strike capabilities with the
    introduction of the Joint Air-to-Surface Standoff Missile (JASSM) and
    the Tactical Tomahawk (TACTOM) cruise missile. These missiles offer
    stealthy (in the case of JASSM), standoff capabilities that can be
    employed in substantial numbers to destroy high-value, well-defended,
    and/or relocatable targets. Testing has begun on the JASSM Extended
    Range (JASSM-ER), which will possess more than double the range of the
    JASSM (over 500 nm, vice 200 nm). JASSM-ER also will be able to loiter
    and transmit in-flight imagery to planners. TACTOM possesses many of
    the same traits as JASSM-ER but also can also be retargeted in flight.
        In addition, the DOD has nearly completed reconfiguring four
    strategic nuclear ballistic missile submarines (SSBNs) into guided-
    missile submarines (SSGNs). The first three SSGNs have completed their
    conversion with the final conversion to be completed in late fiscal
    year 2007. Two of the SSGNs will become operational in fiscal year 2007
    and two more in fiscal year 2008. Each SSGN can carry up to 154
    Tomahawk cruise missiles and deliver special operations teams.
        However, analysis conducted during the 2006 QDR also highlighted an
    important gap in prompt, long-range conventional (non-nuclear) strike
    capabilities. Specifically, the QDR found that existing conventional
    forces, such as fighter and bomber aircraft and surface ships, could
    take hours to days to deploy and strike a target. The new TACTOM and
    JASSM, although valuable additions to conventional forces, do not fully
    address this gap. Today, only nuclear-armed ballistic missiles are
    available 24 hours a day, 7 days a week, to engage distant, fleeting
    targets promptly (within about an hour from the time of an execution
    decision). Without a portfolio of prompt conventional Global Strike
    capabilities--able to generate timely effects, anywhere, anytime--
    America's adversaries will retain substantial freedom of action and
    potential safe havens from which to operate.
        Prompt Global Strike capabilities may be needed for time-sensitive
    operations such as interdicting the transfer of WMD from rogue states
    to terrorists, preventing a rogue state from launching a ballistic
    missile armed with a WMD payload, or disrupting or delaying such
    actions before other U.S. forces arrive on scene. In addition, prompt
    conventional Global Strike capabilities have the potential to suppress
    follow-on launches of ballistic missiles against the United States, its
    forces and allies, and this capability can work effectively in concert
    with ballistic missile defenses to help mitigate the growing long-range
    missile threats the United States will face in the future. In order to
    hold these types of targets at risk, the 2006 QDR called for a
    portfolio of prompt Global Strike capabilities.

                      V. CONVENTIONAL TRIDENT MODIFICATION

        The 2006 QDR determined that a program designated Conventional
    Trident Modification (CTM) was the best low-cost, low-risk, near-term
    solution to begin closing the current gap in prompt conventional global
    strike capabilities. In fiscal year 2007, DOD requested funding to
    modify two Trident II D5 missiles on each of the 12 deployed strategic
    ballistic missile submarines (SSBNs), and replace their nuclear
    warheads with non-nuclear warheads. CTM would provide a unique
    conventional capability to respond to fleeting, time-sensitive, high-
    value targets virtually anywhere in the world. The President's budget
    for fiscal year 2008 seeks $175 million for this initial Prompt Global
    Strike system.
        Although DOD determined CTM to be the best near-term option for
    conventional prompt Global Strike, the Department is considering other,
    longer-term solutions, both sea- and land-based, to broaden the
    portfolio of prompt, non-nuclear capabilities. The additional concepts
    include sea- and land-based conventional ballistic missiles and
    advanced technologies, such as hypersonic glide vehicles, employing
    precision guidance, advanced conventional weapons, and propulsion.
    While these concepts promise to provide expanded Global Strike
    capabilities, for the most part they generally lack the technological
    maturity to achieve full operational status before 2015.

                           VI. CONGRESSIONAL CONCERNS

        Congress raised concerns about CTM last year, and directed that DOD
    provide a Report to Congress in consultation with the Department of
    State. A classified report, signed by both Secretary Gates and
    Secretary Rice, was transmitted earlier this month. I commend the
    report to you; it addresses the critical need for Conventional Trident
    and the concerns. While the concerns raised were posed in terms of CTM
    they apply to many of the other prompt Global Strike capabilities that
    may be available in the mid- to long-term.
        The most frequently cited concern is that a CTM launch could be
    misinterpreted as a nuclear attack, prompting Russian retaliation. The
    CTM report states that the risk is extremely low and can be managed
    effectively. Few states have the sophisticated technology required to
    detect and track a ballistic missile launch. However, the Russian
    Federation has these detection and tracking systems and is generally
    able to evaluate quickly a ballistic missile's flight path and
    determine within tens of miles the missile's aimpoint. In that respect,
    if Russian sensors detected and tracked a CTM launch, the Russian
    command would quickly identify it as non-threatening. Moreover, the
    Russian command would readily distinguish between a CTM launch and a
    massive nuclear first strike.
        Historically, the Russian Federation has not over-reacted to an un-
    notified or unannounced U.S. or Chinese missile launch. Furthermore,
    the United States and the Russian Federation now have a more
    cooperative and less adversarial relationship than during the Cold War,
    and this new relationship provides a much-changed context in which any
    launch of a ballistic missile would be understood.
        Nevertheless, the United States takes the possibility of
    misinterpretation seriously. While the risk is extremely low, DOD has
    developed a comprehensive assurance strategy consisting of confidence-
    building and operational measures, promoting a high degree of
    transparency into CTM operations. Engagement of Russia at senior levels
    is ongoing.
        Another concern is that prompt Global Strike, and CTM in
    particular, may not be well-supported by intelligence capabilities. As
    with all military operations, CTM operations would require actionable
    intelligence that is both accurate and timely and provides a high level
    of situational awareness. Existing intelligence assets can support
    planning and operations of prompt Global Strike systems like CTM, DOD
    continues to improve its global intelligence, surveillance, and
    reconnaissance capabilities. Indeed, current efforts to achieve more
    persistent collection capabilities against both legacy and emerging
    threats would be maturing as the Conventional Trident Modification
    becomes operational. They would be available to support key decision-
    makers and planners involved with employment of future prompt Global
    Strike capabilities. During time-sensitive crises the speed and range
    attributes of prompt Global Strike systems, like CTM, actually would
    provide increased time for senior decisionmakers to evaluate and refine
    intelligence before making a decision to employ force.
        There is also some concern for CTM's status under existing arms
    control treaties. CTM is fully compliant with all U.S. treaty
    obligations. A complete analysis of this issue is available in the
    Report to Congress on Conventional Trident Modification. In summary:

             START:

                     CTM is not a new type of SLBM or new kind of
                    Strategic Offensive Arm.
                     CTM will remain accountable and subject to
                    START's many provisions for as long as START remains in
                    force. These provisions include:

                             Data updates
                             Re-Entry Vehicle On-Site Inspections
                             Transit notifications
                             Launch notifications
                             Telemetry exchange for test launches

                     CTM will have the same number of warheads
                    attributed to it as to the nuclear-armed Trident D5 (8
                    warheads).

             Ballistic Missile Launch Notification Agreement:

                     Notification of CTM flight test launches will
                    continue to be provided; and

             Moscow Treaty:

                             CTM's conventional warheads will not
                            count against the 1,700-2,200 limit on
                            operationally deployed strategic nuclear
                            warheads.

                                VII. CONCLUSION

        DOD strongly believes that conventional prompt Global Strike is
    critical to meeting evolving U.S. security needs in the 21st century.
    The joint DOD-State Department Report to Congress presents a compelling
    assessment of the need for CTM and a clear strategy for mitigating the
    already low risks associated with its use. In the report, Secretary
    Gates and Secretary Rice agreed:

             There is a critical need for CTM to respond promptly
            to potentially grave dangers with conventional means--including
            high-value or fleeting targets such as terrorists or rogue
            states armed with WMD that may be in hard-to-reach or highly
            defended areas;
             CTM is the best and only near-term, low-cost, low-risk
            option to fill an existing capability gap;
             The risk of misinterpretation is extremely low and can
            be readily managed;
             Development and deployment of a Conventional Trident
            is needed to achieve a near-term prompt conventional global
            strike capability; and
             The substantial benefits of CTM far outweigh any
            risks.

        A sustained partnership between DOD and Congress will be needed if
    we are to succeed in transforming our Nation's strategic capabilities
    to meet the uncertainties and challenges ahead. In particular, we need
    to continue the progress on missile defense, revitalize the nuclear
    infrastructure with the RRW programs, and address the need for
    conventional prompt Global Strike. The Conventional Trident is the
    near-term solution, with advanced technologies to expand the range of
    effects in the longer term. The Department will require your continued
    support to replace the legacy Cold War force posture with a New Triad
    that is better suited to the new security environment.

        Senator Bill Nelson. We will explore that further.
        Senator Sessions.
        Senator Sessions. Mr. Green, welcome to your committee.
        Mr. Green. Thank you, sir.
        Senator Sessions. I am interested that the Department
    persists in the Trident modification, the conventional Trident.
    I had suggested that perhaps we better be going forward with
    something else after our last vote. But I give you a chance.
    Can you briefly, succinctly tell us the strategic rationale for
    the prompt global strike?
        Mr. Green. Certainly. Right now we have the ability to
    reach out globally and promptly, but only with nuclear weapons.
    We have the ability to reach out promptly with conventional
    weapons, but only if you have tactical forces properly placed,
    if they are in the right place at the right time. We can also
    reach globally with conventional weapons, but it is not timely.
    That would be in the bomber force and the long-range bomber
    force can take many, many hours, days in fact, to reach its
    target.
        The gap that we see is that prompt global precision
    conventional strike. There are a collection of--we prefer
    actually in our shop not to talk about specific scenarios, but
    a set of attributes that targets have that we may well want to
    think about that kind of capability, that prompt global strike
    capability, to address. Those attributes are time-urgent, very
    distant, perhaps highly defended or in other ways access denied
    for the United States; high value targets, high regret factor
    for not striking a target; and potentially an interest in low
    collateral damage.
        It is those kinds of targets, targets with those sorts of
    attributes, that make us think that this particular kind of
    capability is very valuable.
        Senator Sessions. At our hearing we went through this in
    some detail. But would you explain for us why the cruise
    missile is not an adequate global strike?
        Mr. Green. The cruise missile, of course, flies
    subsonically. They are almost always quite a distance away from
    a target. They have to fly a long way to get there. When you
    look at a map and plot out how long it takes to get to a target
    and how responsive it can be, simply in terms of distance and
    time it does not have the same kind of responsiveness that a
    system like a long-range ballistic missile, wherever it is
    fired from, would have.
        The goal with the conventional Trident is to be able to
    strike a target within about an hour from the decision time to
    move ahead. If you use the same metric for a cruise missile,
    you would be talking many hours before you could strike the
    target.
        Senator Sessions. Who has the lead in the DOD for
    evaluating the various alternatives for prompt global strike
    and who is the advocate in the Department for this capability?
        Mr. Green. Certainly OSD-Policy, the part of the Department
    that I represent, is an advocate for this kind of capability.
    In terms of the specific systems involved, that gets into the
    technical detail and the engineering analysis, and Acquisition,
    Technology, and Logistics takes a look at that. Certainly the
    warfighter gets involved in the discussion about the kinds of
    capabilities.
        Senator Sessions. You are making me nervous. There are a
    lot of people you are mentioning.
        Mr. Green. Acquisition, Technology, and Logistics is one
    organization, I should note.
        Senator Sessions. There needs to be somebody that is
    looking at this really hard, because I think it is an important
    capability. I agree with you that there is virtually no chance
    of a misinterpretation of a single launch. But we have a lot of
    concern about that in Congress, primarily that and perhaps
    other issues.
        Mr. D'Agostino, could you briefly describe the design
    features of an RRW that is to the extent that is not
    classified, and discuss the concerns that some scientists and
    engineers have over the reliability of the existing stockpile
    and perhaps the concerns some have expressed about a new
    untested weapon and whether or not it would be reliable? That
    is three questions. You have 3 minutes.
        Mr. D'Agostino. That will be a challenge in and of itself.
        Senator Sessions. We do not have to vote yet.
        Mr. D'Agostino. I may need one of those supercomputers to
    pull that off.
        We will start off with the RRW question first, the features
    that I feel are important, which are unclassified. We will not
    discuss the classified details, of course, I would be very
    happy to come to the committee and talk to you about, because
    they do support my unclassified statements.
        One element which goes to the case material that is being
    proposed--I cannot say none of the material itself, but the
    processes and the material that are being proposed for the RRW
    will allow us to get rid of a complete processing line down at
    Y-12, a fairly significant processing line that we will not
    need any more in the future. It is a line that generates a
    tremendous amount of wastes. It is a waste that we have to deal
    with and pay for and will pay for out into the future, and it
    is a waste stream that I would like to get off the books, if
    you will, and not build it into our legacy as we move forward
    in determining what the smaller nuclear weapons complex needs
    to be.
        There is another material in the--it is called interstage
    material, also known as Fogbank, but the chemical details of
    course are classified. That is at a facility that we currently
    have right now. It is a very complicated process. I use that to
    support the Navy's program. It takes a tremendous effort to
    operate this facility. It is dealing with toxic materials
    hazardous to our workforce, but it is required. It is the way
    we did things back in the Cold War.
        The RRW will allow us to not have to develop and maintain
    that capability, and that is very important because that has a
    long-term cost and it has an impact on our workforce, just like
    the case material.
        There are some features associated with the explosive
    material that we use for the proposed RRW design, the design we
    are going to spend some more time on, and in fusing insensitive
    high explosives versus conventional high explosives. An
    insensitive high explosive, for one thing, is a type of
    material that you can hit with a hammer, throw into a
    fireplace, do a lot of things to it; it will not start to
    chemically react and explode.
        That provides a tremendous amount of flexibility in our
    manufacturing process, is one; but two, safety. Clearly it is a
    much safer way to do business, and there is a legacy cost not
    just for the Department of Energy (DOE), but for the DOD as it
    moves these warheads around in their storage facilities, on the
    submarines, or in the silos, how we do things in the Air Force.
        So this is just a sampling, if you will, in the interest of
    time.
        Senator Sessions. It really has the potential to not be
    more costly, in fact to actually save money, we hope. That
    would be your challenge.
        Second, there are some other--I see one of the things on
    your web site, NNSA web site, about safety. You are confident
    they would be considerably more safe.
        Mr. D'Agostino. I am very confident in that. We have not
    built it yet, but this is--we have systems out in our current
    stockpile that have certain attributes that we have talked
    about, insensitive high explosives and the like, but putting
    them together in this format allows us to maximize and take
    advantage of all of the features that we have tested before in
    the past. So I am very confident that as we transition the
    stockpile, as the President said, into the lowest possible
    number necessary and change the size and composition and
    character of our workforce, of our nuclear deterrent, that in
    the long run as we have an RRW stockpile it will drive costs
    down significantly.
        I know I can point to specific projects within the NNSA
    that I will not have to build, liabilities I take off the books
    right now and I will not have to program in, as a result of the
    features this proposed warhead design brings to the table.
        Senator Sessions. I think that is good. Just very briefly,
    the reliability of the aging system. Is there some question
    that is raised about that by reliable scientists, and would we
    lose deterrent effect if people thought that the new one that
    is untested could not work? How do we handle those two
    questions?
        Mr. D'Agostino. First I would like to emphasize that it is
    safe and secure. We would like to make it safer and more
    secure. I think, given how as the General described where we
    were in the Cold War and how we are in a constant mode of
    bringing on new systems as we learned about problems, we have
    the advantage now, where it has been 20-plus years as we have
    gone through this type of a design effort, to bring all those
    new features to the table.
        What we are concerned about is sustainability over the
    long-term, continuing to do life extensions, which take a Cold
    War system off the table, replace certain components and parts
    that we think are aging, and sticking it back out. Over time we
    are concerned that these changeouts will introduce small
    variabilities in manufacturing processes that have evolved
    since the last time we have done it, and that over time will
    cause some questions into our ability to certify over the long-
    term these very low-margin systems. These are very high-
    performance systems.
        We want a design and we believe we have a proposed design
    that is much more robust from the standpoint of performance
    margins. We are much further away from the need to ever conduct
    a test because of the margin on the primary associated with
    this system.
        There is a bit of a fallacy that we have always tested a
    warhead before we have introduced it into the stockpile. That
    is absolutely not true. In a closed session I could talk to you
    about specific systems that you might find interesting, or in a
    brief, I can go over specific systems that have been deployed
    without testing, and the variations. We have a very strong test
    pedigree associated with this proposed design. We know a lot
    about this primary, which is the pit. It is also known as the
    plutonium pit. This is a pit design that has been tested and it
    is a minor variation of a pit design that is currently in our
    stockpile right now. We have a lot of data on that pit and we
    have a lot of information on that secondary. So we are very
    confident.
        Senator Sessions. Thank you.
        Senator Bill Nelson. I have a number of questions for the
    record and we have about 6 minutes, so let me just go through
    these questions.
        Mr. D'Agostino, the NNSA has requested $88.8 million for
    the RRW for 2008. At the time the budget request was submitted
    to the Nuclear Weapons Council, it had not approved the
    decision to study the feasibility of the RRW. Now that it has
    approved the feasibility study, will the 2008 funding be used
    to finish the phase 2A study and begin the phase 3 study?
        Mr. D'Agostino. Yes.
        Senator Bill Nelson. All right. I posed a number of
    questions to General Cartwright and I would pose a number of
    those questions to you. The proposed RRW design would be a new
    warhead, yes or no?
        Mr. D'Agostino. The design is new. The warhead is the same.
    It is the same form, fit, and function. It is a new design to
    replace an existing weapon that we have in our stockpile.
        Senator Bill Nelson. This new warhead would fit into an
    existing delivery system, which in the case of the first RRW
    design would be the Mark 5 reentry vehicle for the D-5 missile?
        Mr. D'Agostino. Yes, sir.
        Senator Bill Nelson. The first RRW would replace the W-76
    in whole or in part and would meet the same military
    requirements met by the W-76?
        Mr. D'Agostino. Yes, Mr. Chairman.
        Senator Bill Nelson. Do we know for sure that the RRW could
    be certified and placed in the stockpile at this point and that
    the purpose of the studies that the NNSA will conduct for the
    next 3 years will determine that?
        Mr. D'Agostino. That is right, Mr. Chairman. We are working
    on that path. At this point right now I am very confident.
        Senator Bill Nelson. Based on reviews done to date by the
    NNSA laboratories, do you have the confidence that the RRW
    design will be able to be certified without testing?
        Mr. D'Agostino. Yes, sir.
        Senator Bill Nelson. If it becomes clear at some point that
    it would not be possible to certify the RRW without nuclear
    testing, would you support terminating it effort?
        Mr. D'Agostino. I would say that because it is one of the
    most significant criteria that we had to proceed down this
    path, we would have to examine that. We would have to say, why
    would we go forward in continuing with this effort without
    that.
        Senator Bill Nelson. If successful, the RRW would provide
    increased confidence in the stockpile and enable substantial
    reductions in it overall size of the stockpile?
        Mr. D'Agostino. Yes, sir.
        Senator Bill Nelson. Particularly in the size of the
    reserve?
        Mr. D'Agostino. That is right, Mr. Chairman.
        Senator Bill Nelson. The Nuclear Weapons Council decided to
    study the feasibility of the RRW and not to manufacture or
    deploy an RRW?
        Mr. D'Agostino. That is right.
        Senator Bill Nelson. Admiral Johnson, assuming that the RRW
    is a feasible replacement for the W-76, what is the right mix
    of RRWs and W-76 warheads in the inventory?
        Admiral Johnson. As General Cartwright pointed out, we
    first continue with the 76 life extension. That is the Nation's
    deterrent. Once we go into initial production and then followed
    by full production of the RRW, it becomes a one-for-one
    replacement. The 76-1, those warheads that are life extended to
    the 2040, 2045 region, I would think it would be in the
    Nation's interest then to time the production line for best
    value. So rather than give you a direct number for something
    that is 10 years away or so, it is a one-for-one replacement.
        Senator Bill Nelson. Can you give us a percentage?
        Admiral Johnson. In the early production run we expect to
    make about 50 per year. So in the first 5 years, it would be
    250 weapons. Then depending on what DOE does with their ability
    to increase production, we could stay at that rate. As the
    inventory went down, we could catch that. Or if Congress chose
    to increase the production capability, then it would be an
    accelerated one-for-one replacement.
        Senator Bill Nelson. All the rest of the ones in reserve at
    that point? What would happen?
        Admiral Johnson. The need for reserve is expected to be
    reduced, as every member of the panel has said.
        Senator Bill Nelson. What is the down side of delaying the
    W-76 life extension to see if the RRW is feasible?
        Admiral Johnson. That would be a serious error in my
    opinion. 76 is the bulk of the deployed sea-based warheads. It
    is our Nation's deterrent. We are ready to go into production
    on the life-extended warhead this year and we should proceed
    with that.
        RRW is not designed. In fact, we are only at the beginning
    of that design, laying out the baseline, coming back to you
    with a proposed cost and schedule that you will see later in
    the year.
        Senator Bill Nelson. A variation on my previous question.
    If the RRW is feasible, will the Navy be able to reduce the
    combined number of RRWs and W-76 life-extended warheads to less
    than the total of the number of W-76 warheads today? I am
    talking about the Navy only. In the stockpile.
        Admiral Johnson. With all due respect, Mr. Chairman, the
    requirement for numbers is really General Cartwright's to
    provide to me. I meet that requirement. My expectation is that
    those numbers will continue to go down.
        Senator Bill Nelson. Mr. D'Agostino, the NNSA fiscal year
    2008 pit manufacturing and certification campaign budget
    request includes funds for both the RRW pits and the W88 pits.
    How much of the $281 million for pit manufacturing is for RRW
    pits?
        Mr. D'Agostino. I would like to take that for the record,
    but provide also a response if I could. The actual number,
    percentage-wise, I will get for the record if I could. It is
    important that right now our 88 pit effort is to focus on our
    commitment on making 10 pits per year. This will be the first
    year. It is a fairly significant milestone to support the Navy.
    We will do that over the next 2 to 3 years in order to meet
    what we think jointly with the Department of the Navy we need
    to maintain.
        After that, what we want to do is shift our production
    capability to thinking towards the future, using this RRW
    process, which we feel is going to reduce the processing steps
    by 20 to 30 percent on how we used to build pits. The actual
    number, I would have to take that for the record if I could,
    please.
        [The information referred to follows:]

        The portion of the budget estimate associated with reliable
    replacement warhead (RRW) pit development planning is $13 million,
    however, other elements of the pit campaign also support our planning
    for RRW.
        The purpose of the pit campaign is to make war reserve pits for the
    stockpile (currently the requirement is focused on for pits for the W88
    and RRW) and to increase the pit manufacturing capacity (i.e., the
    number of pits/year) of the nuclear weapons complex to that needed to
    support the nuclear weapons requirements of the Department of Defense.
        The efforts in the campaign are divided into four categories: W88
    pit production; RRW pit development planning; plutonium experimentation
    to enhance certification confidence and to address stockpile issues;
    and technology development and planning to increase pit manufacturing
    capacity for whatever pit type is required. Within those four
    categories, the $281 million in the fiscal year 2008 request is
    associated as follows: W88 production $142 million; RRW pit development
    planning $13 million; plutonium experimentation to enhance
    certification confidence and address stockpile issues $34 million; and
    technology development and planning to increase pit manufacturing
    capacity $92 million.

        Senator Bill Nelson. So the 10 per year are W88 pits?
        Mr. D'Agostino. That is right, Mr. Chairman. For the next 2
    to 3 years we will be building up a reserve of pits that will
    allow us to--as part of our surveillance, what we do is every
    couple of years we take a W88 warhead pit out of the stockpile
    and we do destructive testing on that pit. What that ends up
    doing, because the Nation does not have a long-term or
    maintainable pit production capability, is that it reduces our
    W88 pits by one and it eats into the reserve warheads.
        So we want to build up a couple of years worth of
    production capability. The exact number is classified, but in
    closed session we could tell you. A couple years of production
    capability, that will give the Navy as well as the DOE
    confidence that we will be able to do surveillance work on the
    pits for the life of the expected warhead, well out on the W88
    warhead over the next 2 decades or so.
        Senator Bill Nelson. So the question you are going to
    answer for the record is, how much of the $281 million
    requested will actually go for the manufacture of RRW pits?
        Mr. D'Agostino. Yes, sir.
        Senator Bill Nelson. Okay.
        It also includes $24.9 million for the consolidated
    plutonium center. How is that going to be used?
        Mr. D'Agostino. The $24.9 million for the consolidated
    plutonium center is what we call process development steps. As
    we look forward into the future at our Nation's need to put
    together a pit manufacturing capability, whether it is 50 pits
    per year or 125 pits per year is something we will work out
    with the DOD. That is an important distinction because it
    drives us in a couple of different directions.
        What we are looking at with that money is to do the process
    steps, and to try to figure out what type of equipment we would
    need in this consolidated plutonium center. It helps us with
    those types of studies needed to continue the studies for what
    we are in the process of doing right now, which is a National
    Environmental Policy Act activity to get to a record of
    decision on a long-term pit capability. So it will allow us to
    do the analysis on the different options that we are currently
    working on right now in a very public process.
        Senator Bill Nelson. The requirement for a security force
    at the NNSA facilities has increased rather dramatically.
        Mr. D'Agostino. Yes, sir.
        Senator Bill Nelson. More physical requirements, more
    sophisticated weaponry to meet more stressing design basis
    threats. These are all contractors and are managed differently
    at each site. The guards certainly put their lives in jeopardy
    to protect thousands of nuclear weapons and tons of weapons-
    grade materials.
        So what about taking a more uniform approach to managing
    and training the guard force? Have you considered federalizing
    this force under a single contract? Have you looked at managing
    the force more like a law enforcement entity?
        Mr. D'Agostino. Studies have been done in the past which
    have looked at federalizing, consolidating into one large
    contract, or leaving things as we currently have it, which is
    largely defining the performance characteristics that we have,
    as a way to lay out essentially a bar that has to be met, and
    then going out and doing independent assessments. I have not
    reopened the past studies which once looked at federalizing
    this activity. I am aware of our efforts in essence to look at
    how do we drive consistency across our guard force and as part
    of that what we have done is we have worked with our HSS, which
    is the Office of Health, Safety, and Security, under part of
    our Department, and to simplify our security requirements and
    set up independent teams to go out and look at that.
        I do not know if this is the right time actually to relook
    at that study and to drive consistency. But I will say that one
    of the things we are trying to do is not increase the size of
    the guard force. One of the elements of our Complex 2030 vision
    is to have fewer sites with special nuclear materials and have
    fewer locations within sites for special nuclear materials. I
    expect that to drive our guard forces numbers down and shift
    quite a bit.
        It is much easier to drive things down and shift a bit with
    contracts rather than a Federal workforce. It is just something
    that is in the back of my mind as I look to try to stabilize
    and level off at the right level on our security budget,
    because it does go up significantly between 2007 and fiscal
    year 2008.
        Senator Bill Nelson. What you might do is look at a uniform
    standard among all your different contracts.
        Mr. D'Agostino. I believe we do have that uniform standard
    in our DOE orders, but what we have to do is be consistent in
    how we evaluate our different contractors. There are multiple
    contractors out there for security contracts.
        Senator Bill Nelson. This is one we cannot mess up.
        Mr. D'Agostino. Yes, sir.
        Senator Bill Nelson. General, during the deliberations on
    the 2007 year it became clear that the Air Force could not meet
    its requirements with the reductions in the B-52 bomber fleet
    first proposed in the Quadrennial Defense Review (QDR). So
    Congress approved a reduction of up to 18 bombers from the
    current fleet of 93 B-52s. The authorized reduction was
    predicated on completion of a report that would analyze all
    aspects of the overall bomber fleet, including the requirements
    and the modernization plans.
        Now it is our understanding that the report will not be
    completed and submitted to Congress until at least the end of
    this fiscal year. As a result of the reduction of the 18
    bombers--therefore, they will not be reduced until fiscal year
    2008. So does it make sense to authorize more reductions prior
    to receiving the report from last year, as the questions are
    the same?
        So what has changed since the 2007 authorized retirement of
    only 18 bombers, rejecting the request in the QDR to a
    transition to 56 bombers?
        General Burg. Yes, sir. Senator, the overall management of
    the fleet of aircraft the Air Force has been charged to be
    responsible for is a big challenge, and I think you have
    already heard from our chief in terms of managing that fleet to
    try to get the best capability for the investment that you are
    making in that bomber force. We in the Air Force believe that
    we can reduce the number of B-52s in the bomber fleet while
    retaining the B-1s and B-2s and maintain the bomber capability
    that the combatant commanders require to support their war
    plans.
        We recognize that Congress is very interested in the
    overall numbers of the B-52 remaining and that we have specific
    directions to retain the bomber force or the B-52 force at its
    current level until this study is complete and Congress gets a
    chance to review those results.
        We agree that the study completion will probably be later
    this fall and it will not be available to you in time to inform
    the 2008 budget decisions.
        Senator Bill Nelson. Would the Air Force retire all of the
    18 B-52s authorized to be retired in 2008?
        General Burg. The Air Force would like to have the
    authority to retire those bombers that are awaiting the results
    of that study, and our budget submission submits a program line
    that would retire those aircraft.
        Senator Bill Nelson. What are the changed circumstances
    that would persuade Congress to authorize the retirement of any
    additional B-52 bombers?
        General Burg. Sir, I would answer that the circumstances
    are still roughly what they were prior to this report being
    requested by Congress, that the combatant commanders have told
    us what their needs are for a bomber force, and we feel we can
    meet those needs with the B-2, B-1, and the reduced B-52 force;
    that there are still questions from Members of Congress on
    whether that is an adequate bomber force for the future. But
    the Air Force believes that it is an adequate bomber force with
    the reductions that we had programmed to take in the 2007
    submission.
        Senator Bill Nelson. General, what is the minimum number of
    B-52 bombers needed to protect all the plans and requirements?
        General Burg. We believe that the number that we have
    proposed in the 2008 budget, 56 total aircraft inventory of B-
    52s, is the adequate number for the B-52 when combined with the
    B-1 and B-2 force to provide for the combatant commanders'
    requirements. Now, we recognize that there is some risk in that
    force. If you have two major contingencies at the same time,
    you accept some risk. But if you believe that your future
    requirements will be based on a single major combat operation
    activity, that bomber force with the reduced B-52 numbers meets
    the combatant commanders' requirements.
        Senator Bill Nelson. In that authorization bill from the
    2007 year, it directed the Air Force to maintain 44 combat
    coded B-52 bomber aircraft, which would require a total of 74
    in the inventory. The 44 coded aircraft was a minimum to meet
    requirements. Does the fiscal year request mean that the 44
    combat coded aircraft can be met within the 56 B-52 bombers?
        General Burg. Sir, we recognize the same requirement that
    you have stated, 44 combat coded B-52s, and we are studying the
    ability to make 44 combat coded B-52s available with the force
    of 56 total aircraft inventory. We do not have an answer for
    you right now on whether that is easy to do or how challenging
    it is to do in terms of resources required. It becomes more
    expensive to maintain more combat coded aircraft.
        The answer is still not available to us right now.
        Senator Bill Nelson. So the answer is we do not know if you
    can maintain 44 combat coded within the 56?
        General Burg. Yes, sir, that is correct.
        Senator Bill Nelson. A review of the various modernization
    programs indicates that the Air Force could support somewhere
    between 65 and 70 B-52 bombers, but only if the outyear funding
    for the CONECT program was to be extended. How much would it
    cost to modernize all 76 B-52s?
        General Burg. Sir, I would appreciate the opportunity to
    take that question for the record and get you a very specific
    answer. We feel that we have the adequate resources in the
    modernization programs supporting the B-52 to field up to 72
    aircraft with the modernized capabilities that we are building
    into the B-52. But that uses spares that we had anticipated or
    components that we had anticipated using as spares to support a
    56-aircraft force.
        [The information referred to follows:]

        In order to modernize the current fleet of 76 B-52s, the fiscal
    year 2008 APAF funding required would be $19.02 million. Below are the
    breakout costs of modernizing the B-52s (costing in millions):

                            [In millions of dollars]
    Advanced Weapons Integration...............................      $5.51
    MLR-2020 (ILS receiver)....................................       1.41
    Electronic Countermeasure Improvement (ECMI)...............       3.80
    Avionics Midlife Improvement (AMI).........................          0
    Enhanced Data Link.........................................       1.76
    Digital Stability Augmentation Components..................       6.54

    Fiscal year 2008 funding does not complete the following two
      modification efforts:
      ECMI: Additional funding required to complete installation--fiscal
      year 2009 ($2.7 million) and
      AMI: Additional funding required to support 76 AMI configured B-52s--
      fiscal year 2010 ($3.1 million).

        Senator Bill Nelson. The Air Force already decided, did it
    not, to terminate two other modernization programs, the AMI and
    the ECMI, before they had purchased all the necessary upgrade
    kits? So you would have to restart the manufacturing line.
        General Burg. Yes, sir, we would need to restart the line
    to purchase more kits, and I can give you specific costs for
    the requirement there. We think it is about a $216 million bill
    to maintain 76 aircraft fully capable as you have described, as
    opposed to 56 aircraft.
        Senator Bill Nelson. General, let me ask you. I understand
    that the Air Force is thinking about using parts of the
    Peacekeeper to develop a conventional ICBM that would be
    launched from Vandenberg. Is this a violation of the START
    treaty?
        General Burg. Sir, if I could clarify some aspects of what
    you just asked. We do have a program that would use the first
    segment and third stage of a Peacekeeper missile, which was a
    nuclear ballistic missile. But it would use those stages in a
    way that is not a ballistic missile. The missile follows a
    trajectory that is not ballistic. The difference is very
    significant in terms of how you describe the capability and how
    other nations might view that capability.
        We recognize the concerns of Congress in terms of
    conventional ballistic missiles being confused with their
    nuclear ballistic predecessors. But this is a significantly
    different capability. It flies in a trajectory that is 90
    percent lower than a ballistic missile. It flies on a boost-
    glide trajectory. But it is a fact that we would plan to use
    the first three stages of a Peacekeeper missile to support this
    new conventional strike capability. We do not believe it is a
    violation of the treaty and the treaty is open to different
    ways to describe these kinds of capabilities not as former
    nuclear missiles.
        Senator Bill Nelson. We need a briefing on that particular
    system as to what you plan to do with it and so forth.
        General Burg. Sir, we would be very happy to bring that
    forward to you.
        Senator Bill Nelson. For the General and for the Admiral:
    The military Services each submit unfunded priority lists
    (UPLs). Can you briefly, because they just called the vote,
    discuss the items on the respective lists that fall into your
    areas? Let us go with you, Admiral.
        Admiral Johnson. I do have an item on the UPL and if my
    good associate in the Air Force will go first I might recover
    it in time.
        Senator Bill Nelson. General?
        General Burg. Sir, unfunded requirements cover a broad
    spectrum. For the specifics of how we would use your inputs on
    the UPL, I would like to answer that for the record if that is
    acceptable and give you very specific numbers and places where
    we have capabilities in my portfolio.
        [The information referred to follows:]

        Below is a listing of Air Force programs of interest to the Senate
    Armed Services Committee Strategic Forces Subcommittee that have been
    submitted on our unfunded priority list.
    ICBM Remote Visual Assessment (RVA) $13.5 million:
        Adds funds to purchase 90 additional RVA kits in fiscal year 2008.
    This completes RVA deployment at one intercontinental ballistic missile
    (ICBM) wing to improve security forces' situational awareness. The RVA
    program sends visual signals from remote, unguarded Minuteman launch
    facilities to security force control facilities. The added visual
    information allows the security controllers to prioritize and tailor
    the responding security forces. In total, the 3 ICBM wings have missile
    launch facilities scattered across 44,600 square miles.
    Common Vertical Lift Support Platform (CVLSP) $4.2 million:
        Funds Research and Development to select replacement for 50 UH-1Ns
    (25 AFSPC, 6 AETC, and 19 AFDW) with 54 CVLSPs (28 AFSPC, 6 AETC, 20
    AFDW).

        Senator Bill Nelson. Admiral?
        Admiral Johnson. Sir, on the UPL there are two 87-foot
    cutters to be used in the transit security program as we escort
    our vessels in and out of port. We would like to accelerate
    those purchases, if possible. Those ships are bought through
    the Coast Guard, right off the Coast Guard production line.
    They are identical in every respect to a Coast Guard vessel. We
    arm them slightly differently, but other than that, and those
    are easily changed, they are identical vessels.
        Senator Bill Nelson. These are not the same Coast Guard
    ships that they are suddenly having manufacturing problems
    with, are they?
        Admiral Johnson. No. Those are a different ship, no, sir.
        Senator Bill Nelson. Jeff, do you have anything?
        Senator Sessions. No. I would just say, Mr. Green, I am a
    little concerned about an article from ``The Parliamentarian''
    in the Czech Republic that was concerned about the United
    States' negotiating tactics with regard to the European site. I
    think that it is important that we stay on top of that and make
    sure that we are handling that in a way that is acceptable to
    them, because I think that is an important thing for the whole
    world and for Europe.
        I will ask you for the record, Mr. Green, about the 2006
    bill. The National Defense Authorization Act required a
    commission on the implementation of the new strategic posture
    of the United States. That has not been stood up yet, I
    understand, and I would like you to respond as to why that has
    not.
        [The information referred to follows:]

        Implementation of the Strategic Posture Commission (SPC) has faced
    several hurdles, most notably the absence of any appropriations for the
    commission. Initial estimates were that the SPC would need $4.25
    million to conduct its work, but no funds were provided by Congress in
    the fiscal year 2006 budget. The Department of Defense (DOD) sought
    funds for this purpose in its fiscal year 2006 reprogramming request,
    but Congress reduced the funds available for all DOD commissions. As a
    result, the SPC received no funding. Congress added four new unfunded
    commissions in the National Defense Authorization Act for Fiscal Year
    2007, but only $6.7 million was appropriated for all DOD commissions in
    fiscal year 2007. The President's fiscal year 2007 budget requested
    additional funds for commissions, but Congress cut most of the request,
    citing ``excessive growth'' in boards and commissions. DOD submitted a
    fiscal year 2007 reprogramming request that would shift funds to
    support statutory and discretionary commissions.
        In addition to funding issues, there is also the matter of filling
    the commission positions. Of the 12 individuals selected by the
    Secretary of Defense in consultation with Congress, only 9 accepted the
    invitation to serve. We have been working with the SPC chairman to
    develop a list of alternate candidates for the Secretary's selection
    and approval in consultation with Congress.

        Senator Bill Nelson. Thank you all for your participation
    today. You have been very kind and this hearing is adjourned.
        [Questions for the record with answers supplied follow:]

                   Questions Submitted by Senator Bill Nelson

                   RELIABLE REPLACEMENT WARHEAD AND THE W-76

        1. Senator Bill Nelson. Admiral Johnson, what modifications will
    the Navy have to make on the Mark 5 re-entry vehicle to accommodate the
    first Reliable Replacement Warhead (RRW) design?
        Admiral Johnson. Modifications to the war reserve aeroshell and
    antenna systems are expected to be minimal. Changes to Reentry Body
    (RB) and Release Assembly (RA) cable assemblies and the likely addition
    of a new RA connector are required to support the new surety options.
    That being said, however, a new warhead Arming, Fuzing, and Firing
    (AF&F) system jointly funded by National Nuclear Security
    Administration (NNSA) and Navy will have to be developed and produced
    for the RRW design.

        2. Senator Bill Nelson. Admiral Johnson, assuming that the RRW is a
    feasible replacement for the W-76, what is the right mix of RRWs and W-
    76 warheads in the inventory?
        Admiral Johnson. NNSA production capability of RRW is the limiting
    element. The minimum number needed of W-76-1 is the planned fiscal year
    2012 submarine outload. The planned RRW build, limited by available RRW
    production rate and planned production time of 10 years will produce a
    number of RRWs far short of the needed inventory. If W-76-1 is produced
    in quantities to supply the minimum submarine outload in fiscal year
    2012, then the RRW can replace the end of production of W-76-1
    production requirement with minimum risk to the deterrent.

        3. Senator Bill Nelson. Admiral Johnson, what is the downside of
    delaying the W-76 life extension to see if the RRW is feasible?
        Admiral Johnson. If the RRW is delayed or has significant problems,
    the W-76-0 will age out and Navy will have no replacement capability.
    If W-76-1 is produced in quantities to supply the minimum submarine
    outload in fiscal year 2012, then the RRW can replace the end of
    production of W-76-1 production requirement with minimum risk to the
    deterrent.

        4. Senator Bill Nelson. Admiral Johnson, would the Navy work on a
    new arming, firing, and fuzeing system for the RRW 1 take place as part
    of phase 2A or phase 3?
        Admiral Johnson. For all systems, the fuze is an integral part of
    the design and must be addressed during each phase of the development.
    Work defining top-level fuze requirements, operational modes, and
    preliminary designs occur in Phase 2. These requirements, operational
    concepts, and designs are further refined during Phase 2A in support of
    cost studies and in the development of acquisition and qualification
    strategies. Detailed design of the AF&F will take place in phase 2A
    since there was no specific Navy funding for the AF&F in fiscal year
    2007. Phase 3 begins the engineering and manufacturing development
    phase where component-level requirements and subsystem designs are
    refined, and prototype hardware is produced for qualification and
    optimization for manufacture. The beginning of Phase 3 marks the real
    commitment to an effort which will be reflected in the need for
    resources.

                                  B-52 BOMBER

        5. Senator Bill Nelson. General Burg, what has changed since the
    National Defense Authorization Act (NDAA) for Fiscal Year 2007
    authorized retirement of only 18 B-52 bombers, rejecting the request in
    the Quadrennial Defense Review (QDR) to transition to 56 B-52 bombers?
        General Burg. There has been no significant change to the combatant
    commanders' conventional strike requirements or the overall security
    environment within the last year. However, the Air Force has been
    moving forward to enhance its long-range strike capability by
    implementing a comprehensive three-phased strategy which addresses
    near-term issues and prepares for future operational needs.
        Phase I of this strategy is to modernize the remaining legacy
    bomber force. The B-1, B-2, and B-52 will undergo upgrades focused on
    sustainability, lethality, responsiveness, and survivability that
    enhance their capabilities to provide combat power for the combatant
    command (COCOM). For instance, in President's budget 2008 (fiscal year
    2008-fiscal year 2013) the B-52 has the following enhancements
    programmed: Avionics Midlife Improvement (AMI), Advanced Weapons
    Integration (AWI), Combat Network Communication Technology (CONECT),
    Electronic Countermeasures Improvement (ECMI), and Miniature Air
    Launched Decoys (MALD). These upgrades will allow the B-52 to carry and
    employ the LITENING II advanced targeting pod, rapidly re-target J-
    series weapons in-flight, increase communications capability and
    connectivity, and provide enhanced capability against enemy threat
    systems. As well, the B-1 and B-2 are programmed to receive similar
    upgrades that will result in increasingly capable aircraft. In the
    near-term, the Air Force will present a more capable bomber force to
    the combatant commanders for their employment.
        This modernized legacy bomber force will serve to mitigate the risk
    until Phase II of our long-range strike strategy fields the next
    generation bomber in 2018. Additionally, the Bomber Force Structure
    Study directed by Congress to be accomplished by the Institute for
    Defense Analyses is underway and we expect initial findings to be
    available by August 2007.

        6. Senator Bill Nelson. General Burg, what are the changed
    circumstances or new information that would persuade Congress to
    authorize retirement of any additional B-52 bombers?
        General Burg. There has been no significant change to the combatant
    commanders' conventional strike requirements or the overall security
    environment within the last year. However, the Air Force has been
    moving forward to enhance its long-range strike capability by
    implementing a comprehensive three-phased strategy which addresses
    near-term issues and prepares for future operational needs.
        Phase I of this strategy is to modernize the remaining legacy
    bomber force. The B-1, B-2, and B-52 will undergo upgrades focused on
    sustainability, lethality, responsiveness, and survivability that
    enhance their capabilities to provide combat power for the COCOM. For
    instance, in President's budget 2008 (fiscal year 2008-fiscal year
    2013) the B-52 has the following enhancements programmed: AMI, AWI,
    CONECT, ECMI, and MALD. These upgrades will allow the B-52 to carry and
    employ the LITENING II advanced targeting pod, rapidly re-target J-
    series weapons in-flight, increase communications capability and
    connectivity, and provide enhanced capability against enemy threat
    systems. As well, the B-1 and B-2 are programmed to receive similar
    upgrades that will result in increasingly capable aircraft. In the
    near-term, the Air Force will present a more capable bomber force to
    the combatant commanders for their employment.
        This modernized legacy bomber force will serve to mitigate the risk
    until Phase II of our long-range strike strategy fields the next
    generation bomber in 2018. Additionally, the Bomber Force Structure
    Study directed by Congress to be accomplished by the Institute for
    Defense Analyses is underway and we expect initial findings to be
    available by August 2007

        7. Senator Bill Nelson. General Burg, would the Air Force retire
    all 18 B-52s authorized to be retired in fiscal year 2008?
        General Burg. The fiscal year 2007 program of record retired 18 B-
    52s, including 1 aircraft on loan to the National Aeronautics and Space
    Administration (NASA). In the NDAA for Fiscal Year 2007, Congress
    restricted the retirement of 17 of these aircraft until 45 days after
    the Secretary of the Air Force submits a bomber force structure study
    conducted by the Institute for Defense Analyses (IDA) to Congress. Only
    the aircraft on loan to NASA has not been restricted from retirement
    pending the IDA study. The IDA study should be briefed to the Air Force
    in August 2007, with formal report delivery to Congress by the end of
    fiscal year 2007. The 45-day waiting period pushes the earliest B-52
    retirement into fiscal year 2008. As a result, the Air Force intends to
    retire all 17 aircraft during fiscal year 2008 following submission of
    the IDA study to Congress and the subsequent 45-day waiting period.

        8. Senator Bill Nelson. General Burg, the B-52 draw down is part of
    a broader effort to reposition the B-52 aircraft between the two bases,
    one in Louisiana and one in North Dakota, and consolidate bomber
    delivered nuclear weapons. This is a long-term project. What is the
    likelihood that reductions and repositioning beyond the 18 would occur
    in fiscal year 2008, even if authorized?
        General Burg. The NDAA for Fiscal Year 2007 language limited the
    Air Force to retiring not more than 18 B-52s and maintaining 44 B-52s
    as Combat Coded.
        The Air Force has requested to divest 20 B-52s in the fiscal year
    2008 President's budget, reducing the Total Active Inventory (TAI) to
    56 B-52s. This program is based first on the ability of 56 TAI to meet
    any single COCOM requirement; second on the assessment that the
    operational risk associated with the retirements is acceptable; and
    third the need to recapitalize as a part of the Air Force's three-phase
    long-range strike (LRS) plan.
        If Congress authorizes the divestiture of 20 B-52s in fiscal year
    2008, the Air Force plans to reposition the aircraft as expeditiously
    as possible per the program of record. To remain in compliance with
    NDAA 2007 language while maintaining 56 aircraft TAI, the Air Force
    will place the 20 aircraft in ``Excess to Command'' status.

        9. Senator Bill Nelson. General Burg, what is the minimum number of
    B-52 bombers needed to meet all plans and requirements?
        General Burg. The B-52 program of record as presented in the fiscal
    year 2008 President's budget, retires 18 excess-to-need attrition
    reserve aircraft in fiscal year 2007 and another 20 aircraft in fiscal
    year 2008 for a Total Aircraft Inventory (TAI) of 56. The B-52 force
    structure of 56 TAI satisfies any single COCOM requirement, meets
    requirements for two near-simultaneous Major Combat Operations with
    swing of forces and enables recapitalization as part of the Air Force's
    three-phase LRS plan.

        10. Senator Bill Nelson. General Burg, what is the utilization rate
    for the 74 non-attrition reserve B-52 bomber aircraft?
        General Burg. The standard utilization (UTE) rate for the B-52 is
    5.8 for the Active-Duty and 5.0 for the Reserves. UTE is calculated
    using programmed Primary Aircraft Inventory (PAI) and not Backup
    Aircraft Inventory (BAI). The Active Duty has 37 PAI and the Reserves 8
    for a total of 45 aircraft; two other aircraft (also PAI) are with Air
    Force Materiel Command for test purposes. PAI and BAI total 54
    aircraft. Fiscal year 2006 and fiscal year 2007 standard UTE rates are
    identical.

    ACC
      PAI.....................................  37
      BAI.....................................   6
      AR (Attrition Reserve)..................   2
    Reserve
      PAI.....................................   8
      BAI.....................................   1
    AFMC
      PAI.....................................   2
    Totals
      PAI.....................................  47
      BAI.....................................   7
      AR......................................   2
                                               -----------------------------
                                                56

        The figure of 74 aircraft is based on the fiscal year 2006
    President's budget force structure; an Air Force corporate decision,
    PBD 720, reduced that number to 56 as of the fiscal year 2007
    President's budget.

        11. Senator Bill Nelson. General Burg, what requirement for LRS
    aircraft is not being met by the current fleet of B-52, B-1, and B-2
    bombers?
        General Burg. Proliferation of advanced threat systems such as the
    SU-27, SU-30, SA-20, and S-400 are presenting survivability challenges
    for our legacy platforms and will eventually limit their capability to
    respond and persist in the high threat battle space of the future. The
    Next Generation Long-Range Strike (NGLRS) aircraft, which will be
    fielded in 2018, will provide a stealthy, persistent, responsive
    capability that can attack deep, heavily defended, fixed and mobile,
    high-value targets.

        12. Senator Bill Nelson. General Burg, the NDAA for Fiscal Year
    2007 directed the Air Force to maintain 44 combat coded B-52 bomber
    aircraft, which would require 74 total B-52 aircraft in inventory. The
    44 combat coded aircraft was the minimum to meet requirements. Does the
    fiscal year request mean that the 44 combat coded aircraft can be met
    with only 56 B-52 bombers? What happened in the past 6 months to make
    this possible?
        General Burg. The Air Force is requesting to reduce the number of
    B-52 aircraft in order to divest legacy aircraft for the purpose of
    modernization and recapitalization. The Air Force's Air Combat Command
    (ACC) has stated that they can provide 44 Combat Coded (CC) aircraft
    with 56 TAI. There has been no significant change to the combatant
    commanders' conventional strike requirements or the overall security
    environment within the last year. With a reduced B-52 force, the Air
    Force will still retain the ability to meet any COCOM requirement from
    a total force perspective. The bomber's ability to swing from one AOR
    to another and the ability to introduce different force structures to
    provide the same effect will allow the Air Force to provide the forces
    to the COCOM to meet their requirements.
        The fiscal year 2008 President's budget includes the planned
    retirement of 20 B-52s in fiscal year 2008. The NDAA for Fiscal Year
    2007 language limited the Air Force to retiring not more than 18 B-52s
    and maintaining 44 B-52s as CC. To remain in compliance with NDAA for
    Fiscal Year 2007 language while maintaining 56 aircraft TAI, the Air
    Force will place the 20 aircraft in ``Excess to Command Status.''

        13. Senator Bill Nelson. General Burg, a review of the various B-52
    modernization programs indicates that the Air Force could support
    somewhere between 65 and 70 B-52 bombers with the current modernization
    funding and then only if the out-year funding for the Connect program
    were to be extended. How much would it cost to modernize all 76 B-52s?
        General Burg. In order to modernize the current fleet of 76 B-52s,
    the fiscal year 2008 APAF funding required would be $19.02 million.
    Below are the breakout costs of modernizing the B-52s (cost in
    millions):

                            [In millions of dollars]
    Advanced Weapons Integration...............................        $5.51
    MLR-2020 (ILS receiver)....................................         1.41
    Electronic Counter Measure Improvement (ECMI)..............         3.80
    Avionics Midlife Improvement (AMI).........................            0
    Enhanced Data Link.........................................         1.76
    Digital Stability Augmentation Components..................        6.54

    Fiscal year 2008 funding does not complete the following two
      modification efforts:
      ECMI: Additional funding required to complete installation--fiscal
      year 2009 ($2.7 million) and
      AMI: Additional funding required to support 76 AMI configured B-52s--
      fiscal year 2010 ($3.1 million).

                          HELICOPTERS FOR ICBM FIELDS

        14. Senator Bill Nelson. General Burg, the helicopters that the Air
    Force uses to support the vast expanse of intercontinental ballistic
    missile (ICBM) fields are Vietnam-era and need to be replaced. What are
    the requirements for new helicopters and what are the plans to replace
    the old helicopters, including the estimated cost of the replacement?
        General Burg. The UH-1N does not meet requirements directed in
    Nuclear Weapon Security Manual (Department of Defense (DOD) S-5210.41-M
    dated 22 November 2004), and it cannot be modified to meet Key
    Performance Parameters in speed, lift, range, and capacity. The Air
    Force safely maintains and operates the UH-1N and plans to continue to
    do so until a replacement program is fielded. The Air Force is pursuing
    the Common Vertical Lift Support Platform (CVLSP) as a replacement
    effort. CVLSP is currently unfunded; it is currently number six on the
    Air Force Chief of Staff's Unfunded Priority List (UPL). The Air Force
    has conducted a CVLSP Analysis of Alternatives (AoA) to study
    replacement options. The AoA Final Report is currently with OSD (PA&E)
    for sufficiency review. No reliable cost data is available because the
    replacement platform(s) have not been selected.

        15. Senator Bill Nelson. General Burg, has the Air Force selected a
    replacement helicopter for the ICBM fields?
        General Burg. The Air Force has not selected a replacement for the
    UH-1N. The CVLSP is an unfunded effort to replace the UH-1N. It is
    currently number six on the Air Force Chief of Staff's UPL. Air Force
    Space Command completed an AoA for the CVLSP. The AoA team evaluated 12
    different material solutions and mixed fleet possibilities. The CVLSP
    AoA Final Report is currently with OSD (PA&E) for a sufficiency review.
                                     ______

               Questions Submitted by Senator E. Benjamin Nelson

                     GLOBAL INNOVATION AND STRATEGY CENTER

        16. Senator Ben Nelson. General Cartwright, the Global Innovation
    and Strategy Center (GISC) is a facility to bring together, in a
    cooperative effort, members of the public and private sector and to
    leverage the expertise of the participating members to provide global
    strategies, timely courses of action, and new operational tools and
    analyses in support of the Strategic Command (STRATCOM) mission. What
    is the current status of the GISC and are there accomplishments yet?
        General Cartwright. The GISC became operational in September 2006
    and has completed over 38 diverse projects. For example, the GISC
    successfully teamed with the State of Nebraska and the University of
    Nebraska in the development of a pandemic influenza predictive modeling
    and vaccine distribution program. The program was adopted by Nebraska
    and is under review by the Centers for Disease Control for
    applicability nationwide. Additionally, the GISC teamed with Johns
    Hopkins University Applied Physics Lab to develop software that
    leverages the national satellite systems to produce actionable
    intelligence that previously may have gone unnoticed. This information
    was supplied to the Commander, Pacific Air Forces and successfully
    transitioned to the Air Force for integration into the Distributed
    Common Ground System. The GISC is also working on projects to help
    redefine global deterrence in the 21st century that have already proven
    useful. We view these example projects and more as accomplishments.

        17. Senator Ben Nelson. General Cartwright, can you describe the
    collaborations with the university community in Nebraska as well as the
    private sector?
        General Cartwright. In addition to collaborating with the
    University of Nebraska community on pandemic influenza modeling, the
    GISC implemented an intern study program. This USSTRATCOM ``first''
    leverages the academic rigor of a small, cross-disciplinary University
    of Nebraska academic team to take a fresh, unclassified look at tough
    issues confronting the Command and the Nation. The GISC recently
    completed its first intern study project, which looked at
    communications transmission in the Pan Sahel of Africa. Furthermore two
    intern study groups will begin in the fall, leveraging academic teams
    from the University of Nebraska Omaha and the Peter Kiewit Institute.
    Eventually the GISC will leverage national and international academic
    teams to evaluate similar timely issues. The GISC recently hosted a
    first of its kind Global Leadership Conference bringing private sector
    CEOs together with the military to gain a perspective on collaborating
    and working future issues. Our objective is to utilize cross
    organization and disipline collaboration to develop new strategies for
    our most difficult problems. This peering, self-organized effort
    bypasses vertical closed approaches, and physical and regional
    artificial boundaries to generate innovation.

        18. Senator Ben Nelson. General Cartwright, obviously, GISC is
    still evolving; what do you foresee for the future?
        General Cartwright. Globalization has given us unique challenges
    but it has also given us opportunities to access information that will
    enable us to have new knowledge discovery by using the latest
    technologies, large network bandwidth, and a global approach. This
    structure allows the GISC to think and act globally; break down
    artifical closed, vertical, physical, regional boundaries; create
    peering relations; and foster self-organized functional activites. The
    GISC is an organization where Government, industry, and academia can
    come together and tackle the Nation's toughest problems in an
    environment that is conducive to information sharing with an innovative
    global perspective.

        19. Senator Ben Nelson. General Cartwright, the February 6, 2006,
    QDR assigned STRATCOM lead responsibility to operate and protect the
    Department's Global Information Grid (GIG). That's a part of STRATCOM's
    Information Operations (IO) mission. Can you describe what that means--
    ``operate and protect'' the GIG?
        General Cartwright. Defending the GIG implies only defending the
    DOD. We defend the Nation by layered defense off shore in partnership
    with Homeland Security on shore. Operating and defending the GIG means
    providing the framework, policy, guidance, and supervision to all users
    on the DOD's networks to ensure we are protecting our greatest
    resource: information. Employing an overall strategy of defending the
    GIG and the information it contains, USSTRATCOM employs a proactive
    preventive capability and flexible, rapid, and aggressive response
    actions. Our concept of Computer Network Defense (CND) depends upon
    situational awareness of the network environment, predictive warning of
    impending attacks, defensive tools, and measures to defeat attacks when
    they occur. Out intent is to assure timely and secure net-centric
    capabilities in support of DOD's full spectrum of warfighting,
    intelligence, and business missions. Operating and defending the GIG
    means employing a defense-in-depth approach that is routinely validated
    and enhanced through rigorous full-dimensional exercises across the
    DOD. Over the last 2 years, we've made tremendous headway in deterring
    and reducing the number of intrusions.

        20. Senator Ben Nelson. General Cartwright, Barksdale Air Force
    Base has a brand new Global Cyberspace Innovation Center. What is the
    relationship between the GIG and those activities?
        General Cartwright. Eighth Air Force, headquartered at Barksdale
    Air Force Base, is the Numbered Air Force Component assigned to provide
    Air Force cyber and global strike capabilities to USSTRATCOM. Barksdale
    Air Force Base hosts the Air Force Network Operations Center and
    STRATCOM's Air Operations Center. The local Shreveport-Bossier
    community established a ``Cyberspace Innovation Center'' to organize
    local industry and academia cyberspace efforts and integrate them into
    the nationwide network of innovation centers of excellence. The focus
    areas of the Cyberspace Innovation Center are cyber research and
    development, public law and policy, and training and education. The
    Center will take advantage of existing state-of-the-art resources such
    as the Louisiana Consortium for Education, Research, and Technology and
    the Louisiana Optical Network Initiative to provide very high
    bandwidth, virtual collaboration between partners.
                                     ______

                   Questions Submitted by Senator Mark Pryor

                              NUCLEAR CAPABILITIES

        21. Senator Pryor. General Cartwright, our missile defense system
    is an important response to the challenges of ballistic missile
    proliferation. How do we extend deterrence or enhance defenses against
    the ballistic missile threat for our deployed forces and allies?
        General Cartwright. Global integration of regional missile defense
    capabilities with our allies is crucial to enhancing and extending
    global deterrence. We continue to rely on the Patriot missile system
    for defense of deployed forces while we work to build additional
    capabilities. The Missile Defense Agency, with essential warfighter
    input, is developing and testing additional ground- and sea-based
    systems that complement this system and will provide the robustness and
    redundancy we require to defend our allies and deployed forces. Allies
    are also active participants in providing protection against ballistic
    missile threats as they continue to expand cooperative programs with
    the U.S. Government. Japan's purchase and fielding of missile defense
    systems and the desire of European countries to host forward deployed
    radars and interceptors provide evidence of ally aspirations to protect
    their homeland. Active defense forces are but one piece of the
    solution; we also look to attack operations, passive defense, and
    nonkinetic options to meet the threat.

        22. Senator Pryor. Mr. D'Agostino, it is imperative to national
    security to ensure the safety, security, and effectiveness of our
    nuclear stockpile. How do we validate the reliability of new modular
    and interoperable nuclear warheads under the RRW program?
        Mr. D'Agostino. The NNSA design laboratories (with Lawrence
    Livermore as the lead laboratory) will employ the same broad approach
    used to verify the continued performance of existing warheads. The
    laboratories will conduct integrated experiments, develop models, and
    use computational analysis to quantify performance margins and assess
    uncertainties.
        The designers have identified and understand the key performance
    parameters for RRW would be designed utilizing archived nuclear test
    data. The RRW will be designed so that these key performance parameters
    arc farther away from failure points (have greater margin) than the
    current Cold War warheads designed for high yield to weight. This
    approach would give designers higher confidence in their ability to
    certify the design without underground nuclear tests. Years of
    experience studying materials and manufacturing processes, and with
    capabilities developed as part of the Stockpile Stewardship Program,
    combined with past nuclear test data, provide a basis for designers to
    address known areas of uncertainty. Improved warhead performance
    margins that would be incorporated into the replacement warhead design
    will reduce uncertainty due to aging, and reduce the likelihood that
    underground nuclear testing will be required in the future to resolve a
    technical problem in the stockpile. The quantification of margins and
    uncertainties (QMU). for key performance parameters would aid in
    understanding the limits of the performance and be the basis for the
    laboratory directors' certification of a RRW design.

        23. Senator Pryor. Mr. D'Agostino, the NNSA has said that the
    acquisition of nuclear weapons, weapons of mass destruction (WMD)
    capabilities, technologies, and expertise by rogue states or terrorists
    stands as one of the most potent threats to the United States and
    international security. What is your plan to address these threats?
        Mr. D'Agostino. The overall strategy to protect the United States
    from rogue state and terrorist nuclear weapons threats has seven
    components:

             Determine intentions, capabilities, and plans to
            develop or acquire nuclear weapons;
             Deny access to nuclear materials, expertise, and
            technologies required to develop nukes;
             Detect and disrupt attempted movement of nuclear
            materials, weapons, personnel;
             Deter nuclear attack;
             Prepare for and respond to nuclear attack;
             Define the nature and source of a terrorist-employed
            nuclear device; and
             Disarm and dispose of a terrorist nuclear device.

        Prevention is the key to an effective strategy. The NNSA is working
    intensively to assist overall U.S. efforts to prevent acquisition of
    nuclear devices and fissile materials by rogue states and terrorists
    by:

             Strengthening physical security of U.S. nuclear
            weapons and weapons usable materials;
             Providing assistance to Russia to strengthen
            protection, control, and accounting of its nuclear weapons and
            materials;
             Working with friends and allies to secure weapons-
            usable nuclear materials worldwide, and to strengthen security
            at civil nuclear facilities; and
             Taking more aggressive steps to interdict illicit
            trafficking in weapons-usable nuclear materials and related
            technologies via strengthened export controls, cooperation with
            other countries through Second Line of Defense and MegaPorts
            programs, and the Proliferation Security Initiative.

        Attribution, or the capability to rapidly characterize and identify
    the source of a nuclear warhead or weapons usable nuclear materials
    either before or after an attack, is a vital component of our overall
    strategy to deter nuclear terrorism. This is for the reason that it is
    far less likely that a stale will provide nuclear weapons to terrorists
    if it knows that there is a strong likelihood that we will attribute
    the weapon to that state, and that we are fully able to retaliate on
    the source. During the period of nuclear testing NNSA developed a
    national capability for technical nuclear forensics to support its own
    test program and to understand the nature of non-U.S. nuclear tests.
    This capability, developed over a period of decades during the Cold
    War, is critical to attribution of terrorist nuclear threats. Among
    other things, the NNSA is developing a concept of operations to assess
    origin of an interdicted nuclear device; and is also working to ensure
    that the capabilities exist at our national laboratories for pre- and
    post-detonation forensics assessments.
        Through its national laboratory system the Department of Energy
    (DOE) deploys highly-trained learns of experts to search for
    clandestine nuclear materials or warheads and to disarm and dispose of
    a terrorist nuclear device. These teams work in concert with elements
    of the DOD, DHS, and the FBI to provide the total national response to
    nuclear terrorism.

        24. Senator Pryor. General Burg, how do we reduce our ICBM nuclear
    arsenal without compromising our strategic deterrent posture?
        General Burg. On 16 March 07, the Air Force provided a detailed
    report on ICBM force modernization in response the guidance contained
    in section 139 of the NDAA for Fiscal Year 2007 (P.L. 109-364). We are
    forwarding through classified channels an excerpt from this report that
    addresses the United States' strategic deterrent posture.

        25. Senator Pryor. Admiral Johnson, nuclear propulsion plays a
    vital role in our Navy's effective forward presence throughout the
    world. How can we ensure their continued safe, reliable, and long-lived
    operation?
        Admiral Johnson. The Director, Naval Nuclear Propulsion Program,
    has statutory authority for oversight and direction of all aspects of
    naval nuclear propulsion. U.S. nuclear-powered warships have safely
    operated for more than half a century without experiencing any reactor
    accident or any release of radioactivity that had an adverse effect on
    human health or the quality of the environment. The program has
    consistently limited personnel radiation exposure more stringently than
    the civilian nuclear power industry or other Government nuclear
    programs. No civilian or military personnel in the Naval Nuclear
    Propulsion Program have ever exceeded the Federal lifetime radiation
    exposure limit or the Federal annual limit in effect at the time.
        Naval reactors' safety standards are mainstreamed across all
    organizations in the Naval Nuclear Propulsion Program, from
    headquarters to equipment suppliers, contractors, laboratories,
    shipyards, training facilities, and the fleet. Continued safe and
    reliable operation is ensured through the long-term, deliberate
    investment in the material, design, and operational standards that
    characterize the Naval Nuclear Propulsion Program.
                                     ______

                  Questions Submitted by Senator Jeff Sessions

                       RESPONSIVE NUCLEAR INFRASTRUCTURE

        26. Senator Sessions. General Cartwright, the Nuclear Posture
    Review (NPR) called for the development of a ``responsive nuclear
    infrastructure.'' Have the DOD and the DOE ever formalized a definition
    of ``responsive''?
        General Cartwright. The June 2004, Report to Congress, A Revised
    Nuclear Weapons Stockpile Plan for 2012, submitted by the Secretary of
    Defense and Secretary of Energy defines ``responsive'' as, ``. . . the
    resilience of the nuclear weapons enterprise to unanticipated events or
    emerging threats, and the ability to anticipate innovations by an
    adversary and to counter them before our deterrent is degraded all the
    while continuing to carry out day-to-day activities in support of the
    stockpile.'' The DOD continues to work with the DOE on quantitative
    metrics.

        27. Senator Sessions. General Cartwright, what performance metrics
    are used to measure ``responsiveness''?
        General Cartwright. The June 2004, Report to Congress, A Revised
    Nuclear Weapons Stockpile Plan for 2012, submitted by the Secretary of
    Defense and Secretary of Energy defines responsive nuclear
    infrastructure. The DOD continues to work with the DOE on quantitative
    metrics to include:

              1) Time to fix stockpile problems;
              2) Time to adapt weapons by modifying or repackaging existing
            warheads;
              3) Time to design, develop, and begin production of a new
            warhead;
              4) Production capacity levels;
              5) Force augmentation service levels; and
              6) Test readiness posture.

        28. Senator Sessions. General Cartwright, how often is the
    performance of the nuclear weapons complex assessed against these
    metrics and by whom? To whom is the performance reported?
        General Cartwright. Through the Nuclear Weapons Council, DOD and
    NNSA constantly and jointly monitor progress toward meeting
    responsiveness objectives. In fact, NNSA provides quarterly reports to
    the Nuclear Weapons Council.

        29. Senator Sessions. General Cartwright, is cost effectiveness, or
    delivering products for a predicted cost target, one of the measures of
    performance?
        General Cartwright. Cost is a measure of performance for program
    execution. Infrastructure responsiveness impacts cost and schedule. One
    of the responsiveness objectives is to ensure an economically
    sustainable nuclear weapons enterprise.

        30. Senator Sessions. General Cartwright, in your view, what
    progress has been made in the last 5 years on the development of a
    ``responsive'' infrastructure?
        General Cartwright. The NNSA has begun to transform the nuclear
    weapons complex. In 2006, NNSA developed the Complex 2030
    Transformation Plan and established the Office of Transformation to
    transform the nuclear weapons complex. Recent accomplishments include:
    initiating tritium extraction operations, increasing throughput at
    Pantex and Y12 plants, starting modernization and construction projects
    for critical scientific and production facilities, and creating a
    systems integration structure to improve efficiency and responsiveness.
    The completion of the detailed cost and design study for the first RRW
    is another critical milestone for transformation. We support NNSA's
    nuclear complex transformation efforts but recognize much work remains
    to be done.

          COST OF RELIABLE REPLACEMENT WARHEAD VERSUS THE CURRENT PATH

        31. Senator Sessions. Mr. D'Agostino, is the DOE preparing a
    detailed analysis of the cost differential between the development and
    deployment of a stockpile based on the RRW versus the cost of
    continuing with life extension programs into the foreseeable future?
        Mr. D'Agostino. Yes. We are using computer models of the nuclear
    weapons complex enterprise to bound probable costs for a variety of
    different scenarios that include a comparison of Life Extension Program
    (LEP) and RRW stockpiles. The models indicate long-term economic
    benefits for an RRW-based stockpile. However, because we are in the
    early stages of finalizing the RRW and facility designs the detailed
    costs associated with RRW development and deployment. Utilization of
    the RRW design enables the elimination of certain hazardous operations
    and a reduced suite of production capabilities that would have to be
    retained and refurbished to support an LEP stockpile strategy. The RRW
    Phase 2A will provide the baseline cost of a first design but it will
    not be completed before the end of fiscal year 2008.

        32. Senator Sessions. Mr. D'Agostino, when will this analysis be
    completed and presented to Congress?
        Mr. D'Agostino. Assuming we are authorized and appropriated by
    Congress to continue design definition and detailed RRW cost analysis,
    Phase 2A, we should be able to present the detailed cost differential
    between the different stockpile scenarios in late 2008.

        33. Senator Sessions. Mr. D'Agostino, do you think pursuit of the
    RRW might be the less expensive option and, if so, why?
        Mr. D'Agostino. Based upon the enterprise modeling results we have
    now, we expect a stockpile option based on RRW concepts to be less
    expensive than a LEP stockpile option over the next several decades.
    Since a primary objective of RRW development is to increase design
    margins in order to ensure warhead reliability while reducing the
    potential need for an underground nuclear test, we intend to pursue
    RRWs in a manner that makes them easier to manufacture, certify, and
    maintain, as well as decrease the need for large numbers of
    augmentation warheads. The RRW strategy is also intended to take
    intrinsic safety and warhead security to a level that is not possible
    to incorporate into an existing Cold-War design. All of these are
    expected to reduce long-term costs.

                           COMPLEX 2030 ALTERNATIVES

        34. Senator Sessions. Mr. D'Agostino, how confident are you that
    the range of alternatives being considered under the Complex 2030 plan
    encompasses the full range of downsizing or facility consolidation that
    will be appropriate for the nuclear weapons complex of the future--one
    which supports a much smaller stockpile?
        Mr. D'Agostino. I am quite confident that we are considering the
    full range of reasonable downsizing or facility consolidation
    alternatives as part of our complex transformation planning. For
    example, we are evaluating alternatives ranging from no action to a
    consolidated nuclear production center (CNPC) in our Complex
    Transformation Supplemental Programmatic Environmental Impact Statement
    and supporting business case analyses. A CNPC would consolidate all
    nuclear component manufacturing and weapon assembly/disassembly
    operations to one site. In addition, we are considering intermediate
    nuclear production alternatives that range from downsizing-in-place at
    three sites to consolidating to two sites. We are also analyzing the
    impacts of a smaller stockpile in the event that national security
    requirements are revised.

        35. Senator Sessions. Mr. D'Agostino, do you think the ``tough''
    decisions about the future of some of these facilities can really be
    made without an external body, such as a Base Realignment and Closure
    (BRAC) Commission, doing an evaluation?
        Mr. D'Agostino. Yes, I believe that we will be able to make the
    tough decisions. NNSA is evaluating all reasonable alternatives and
    using external groups that include officials who have BRAC experience.
    With the support of Congress, I anticipate making a number of tough
    decisions. Given the age of the NNSA production complex, and the
    associated high maintenance and security costs, we need to transform
    expeditiously. Our analyses show that delay is costly. It does not seem
    likely that a BRAC could be authorized, organized, and complete its
    evaluations in sufficient time to provide benefits that outweigh the
    cost and risk of delays.

               BUSINESS PRACTICES OF THE NUCLEAR WEAPONS COMPLEX

        36. Senator Sessions. Mr. D'Agostino, do you think there would be
    value in having an independent group or commission review the business
    practices of the nuclear weapons complex to search for efficiencies and
    other improvements to the way business is conducted in the complex?
        Mr. D'Agostino. Several independent groups have already conducted
    reviews of various operations within the nuclear weapons complex to
    include the business practices. These groups include the Secretary of
    Energy Advisory Board's Recommendation for the Nuclear Weapons Complex
    of the Future, the National Research Council, the DOE Inspector General
    and the Government Accountability Office. From these reviews, we have
    identified certain business areas to focus on for further efficiencies
    and improvements. As an example, NNSA has implemented the Supply Chain
    Management Center to consolidate and streamline procurement actions
    across the complex. Improvements in program and project management and
    cost estimating practices are also of particular interest. Further
    external, independent reviews of these practices may be beneficial
    after implementation, when results have been achieved.

        37. Senator Sessions. Mr. D'Agostino, many corporations have been
    able to improve their operations through such reviews--such as Lean Six
    Sigma, quality process improvement, and other corporate initiatives. Do
    you have any such reviews currently ongoing? If so, do you have any
    results that you can share with the committee?
        Mr. D'Agostino. In the Nuclear Weapons Complex, several reviews and
    initiatives have been conducted to improve processes and business
    practices. Examples of some major improvement initiatives are the
    Pantex Throughput Improvement Plan (PTIP) and the Y-12 Throughput
    Improvement Plan (YTIP). Both quality process improvement plans takes a
    fresh look at nuclear production operations and then changes those
    practices that are considered unnecessary and inefficient. Specific
    accomplishments have enabled increasing the weapon dismantlement rates
    more than 146 percent over previous year's rate. Quality improvement
    methods have also been applied in other areas such as non-nuclear
    production at the Kansas City Plant, warhead disassembly and inspection
    at Pantex, and neutron generator production at Sandia National
    Laboratories (SNL). By applying Lean Six Sigma techniques, SNL has
    increased capacity by 67 percent, reduced inventory by 55 percent, and
    realized cycle time reductions of up to 75 percent. In the business
    area, NNSA has optimized its procurement and spend management by
    implementing corporate initiative of the Supply Chain Management Center
    in fiscal year 2007. By applying industry best business practices of
    strategic sourcing and eProcurement, NNSA will deliver procurement
    process efficiencies and cost avoidances (estimated at 1 percent of
    annual contractor spend or $30 million annually).

      ADMINISTRATIVE COSTS OF THE NATIONAL NUCLEAR SECURITY ADMINISTRATION

        38. Senator Sessions. Mr. D'Agostino, the fiscal year 2008 budget
    request seeks $395 million for the salaries, benefits, and other
    administrative costs of the Federal operations of the NNSA, an increase
    of $54 million over fiscal year 2007. Could you please describe the
    justification and purpose of this increase?
        Mr. D'Agostino. The $54 million increase is the difference between
    the fiscal year 2008 President's budget and the initial fiscal year
    2007 appropriation of $341 million under the fiscal year 2007 year-long
    Continuing Resolution. The current fiscal year 2007 level in this
    account has been increased by an appropriation transfer of $17 million,
    to a total of $358 million, so the increase to the fiscal year 2008
    President's budget request is actually $37 million.
        Receiving the full fiscal year 2008 budget request level of $395
    million is essential for NNSA to recover a viable operations level
    following the severe funding constraints during fiscal year 2007. Over
    70 percent of the total request is for Federal salaries and benefits,
    and over half of the fiscal year 2008 increase is in this area to cover
    increase in benefits costs, including the Federal Cost-of-Living
    adjustment. The President's budget request will allow NNSA to lift the
    hiring freeze and begin to again acquire critical skill personnel to
    support rapidly expanding mission programs, including Defense Nuclear
    Nonproliferation. Achieving this increase is vital at this time so that
    NNSA can expand hiring to position the overall organization to replace
    large numbers of managers and senior staff expected to begin NNSA's
    retirement ``bow wave'' in the next 18 months.
        The remaining 30 percent of the President's request is for ``non-
    payroll'' costs. This would restore a prudent level--about 5 percent
    growth--in travel needed to support expanding international program
    work. Funding for support services contracting would stay essentially
    flat with the levels achieved in fiscal year 2007, with internal
    reprioritization to meet emerging mission program needs. Funding at the
    President's request level will allow us to fully fund departmental
    assessments for space, occupancy, and corporate systems, meet increased
    requirements and costs for Federal information technology equipment and
    systems, and continue to fund our commitments to the Historically Black
    Colleges and Universities programs that had to be ``gapped'' because of
    funding shortages during fiscal year 2007.
        Because of the severe funding constraints in this account in fiscal
    year 2007, Federal employment levels are currently slightly below
    projections, and with funding at the President's request and aggressive
    hiring, NNSA can return to the hiring curve needed to address the
    current and future needs of the national security enterprise.

                      NATIONAL TECHNICAL NUCLEAR FORENSICS

        39. Senator Sessions. Mr. D'Agostino, the fiscal year 2008 budget
    requests funding for a new initiative called National Technical Nuclear
    Forensics (NTNF). This funding will establish a capability to support
    post-detonation activities in the event of a nuclear WMD attack and
    will enhance technical nuclear forensics capabilities. What
    capabilities would be developed with this funding that do not already
    exist at the nuclear weapons labs?
        Mr. D'Agostino. NTNF provides information that is critical to the
    larger issue of attribution. Post-detonation nuclear forensics is
    directed by National Security and Homeland Security Presidential
    Directives: ``Maintain nuclear materials and weapons expertise and
    nuclear forensics capabilities including nuclear device, IND, and RDD
    concept and design information through appropriate restricted data
    nuclear weapon data controls as appropriate.'' With the additional
    funding requested for fiscal year 2008, NNSA will enhance its
    radiochemistry analytical capabilities to be able to provide more
    quickly the information that is essential for determining a device's
    design and the source of the materials used. These capabilities include
    expanding laboratory capacity (to handle more samples more quickly),
    improving laboratory processes (to achieve, for example, streamlined
    analyses), enhancing device modeling capabilities, improving knowledge
    management of the technical information contained in materials
    databases, and providing better attribution tools.

                              PROMPT GLOBAL STRIKE

        40. Senator Sessions. Admiral Johnson, you note in your prepared
    statement the $175 million request to provide an initial capability for
    the Conventional Trident in 2010. Is the Navy examining other long-
    range conventional strike capabilities that could be employed on a
    surface ship or submarine?
        Admiral Johnson. Yes, the Navy is examining other conventional
    strike solutions to provide CDRSTRATCOM with Prompt Global Strike
    capability. Congress provided funds in fiscal year 2005 and fiscal year
    2006 which allowed the Navy to demonstrate new low-cost solid rocket
    motor technology for a smaller scale ``intermediate'' range ballistic
    missile. Leveraging this work, the Navy has been studying a concept for
    a longer range (3500 nm) Global Strike Missile that could be deployed
    initially on the four SSGN submarines, and considered for later
    deployment in the SSBN fleet alongside the D5 system. The conceptual
    Submarine Launched Global Strike Missile (SL-GSM) is one of several
    alternatives currently being assessed under the Air Force lead Prompt
    Global Strike (PGS) Analysis of Alternatives. Both the intermediate
    range (1500 nm) and global range (3500 nm) missile concepts are only
    being assessed for employment from submarines. Other surface ship
    strike options are available for shorter `tactical' ranges (<1000 nm).
    The Conventional Trident Modification is the only `long-range' (>4000
    nm) conventional strike capability that could be rapidly developed and
    deployed to deliver Prompt Global Strike.

        41. Senator Sessions. Admiral Johnson, I understand these options
    cannot be fielded as quickly as the conventional trident missile (CTM).
    What other options might be available?
        Admiral Johnson. The Conventional Trident Modification is the only
    conventional strike system that could be rapidly developed and deployed
    to deliver Prompt Global Strike capability. The Submarine Launched
    Global Strike Missile (SL-GSM) concept could not be developed and
    fielded as quickly as the CTM capability. Initial studies indicate a
    SL-GSM system could be developed, tested, and deployed on the SSGN in
    approximately 5 years from initial funding. The SL-GSM concept delivers
    a terminally-guided large single warhead to 3500 nm with a range of
    kinetic effects including penetrating capability to defeat hard and
    deeply buried targets. While formal budget quality numbers are still
    being developed, an SSGN only capability is estimated to cost
    approximately $2.5-3.0 billion to develop, test, procure, and deploy
    SL-GSM on all SSGN submarines.

                      UNITED KINGDOM NUCLEAR MODERNIZATION

        42. Senator Sessions. Admiral Johnson, the United Kingdom plans to
    spend $40 billion to modernize its nuclear deterrent by creating a new
    generation of nuclear submarines to carry American-supplied Trident
    missiles. The current force of 4 Vanguard-class submarines each carry
    16 Trident long-range ballistic missiles with British nuclear warheads.
    What role, if any, will the United States play in the United Kingdom's
    modernization effort?
        Admiral Johnson. The 7 December 2006 exchange of letters between
    President Bush and Prime Minister Blair reaffirmed the United States
    commitment to support the missile system and associated equipment
    deployed by the United Kingdom. President Bush confirmed the United
    States will support the United Kingdom participation in the life-
    extension program for the Trident II D5 missile and associated
    equipment, under the continuing framework of the Polaris Sales
    Agreement and the 1982 Exchange of Letters.

        [Whereupon, at 12:07 p.m., the subcommittee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2008

                                  ----------

                           WEDNESDAY, APRIL 11, 2007

                                   U.S. Senate,
                      Subcommittee on Strategic Forces,
                                   Committee on Armed Services,
                                                        Washington, DC.

                       BALLISTIC MISSILE DEFENSE PROGRAMS

        The subcommittee met, pursuant to notice, at 3:12 p.m. in
    room SR-232A, Russell Senate Office Building, Senator Bill
    Nelson (chairman of the subcommittee) presiding.
        Committee members present: Senators Bill Nelson, Reed,
    Inhofe, Sessions, and Thune.
        Majority staff members present: Madelyn R. Creedon,
    counsel; Richard W. Fieldhouse, professional staff member; and
    William G.P. Monahan, counsel.
        Minority staff members present: Gregory T. Kiley,
    professional staff member; and Robert M. Soofer, professional
    staff member.
        Staff assistants present: Kevin A. Cronin and Benjamin L.
    Rubin.
        Committee members' assistants present: David E. Bonine,
    assistant to Senator Byrd; Elizabeth King, assistant to Senator
    Reed; Christopher Caple, assistant to Senator Bill Nelson; M.
    Bradford Foley, assistant to Senator Pryor; and Stuart C.
    Mallory, assistant to Senator Thune.

           OPENING STATEMENT OF SENATOR BILL NELSON, CHAIRMAN

        Senator Bill Nelson. This Subcommittee meets to hear from a
    very distinguished panel. Our witnesses are Lieutenant General
    Obering, Lieutenant General Campbell, Dr. Charles McQueary,
    Brian Green, and Paul Francis.
        All of you have prepared statements. They will be entered
    in the record and we will keep the hearing record open for 3
    days to allow members to submit statements or questions for the
    records.
        We're going to discuss several key issues. The Government
    Accountability Office (GAO) has raised a number of important
    acquisition issues related to improved oversight and
    accountability of our missile defense programs and we want to
    see how we can improve these programs.
        Last year, Congress enacted a provision of law that
    requires the Department of Defense to place a priority on the
    development, testing, fielding, and improvement of effective
    near-term missile defenses. We want to learn how the Department
    has implemented that requirement.
        There are many questions about a proposed deployment in
    Europe of long-range interceptors and associated radars and we
    need to explore those questions. Since we all want our missile
    defense systems to work in an operationally-effective and cost-
    effective, and suitable manner, we need to discuss some of the
    important testing issues.
        So, we're going to dig into this in detail. My preference
    is that since we have your prepared statements already entered
    into the record, there's no sense for you to sit there and re-
    read it to us. So, we want you to talk to us.
        I turn to our ranking member, Senator Sessions.
        [The prepared statement of Senator Bill Nelson follows:]

                   Prepared Statement by Senator Bill Nelson

        Good afternoon. The subcommittee meets this afternoon to consider
    the ballistic missile defense programs of the Department of Defense.
        Our witnesses today are:

             Lieutenant General Henry Obering, U.S. Air Force,
            Director of the Missile Defense Agency;
             Lieutenant General Kevin Campbell, U.S. Army,
            Commander of the Army Space and Missile Defense Command, and
            Commander of the U.S. Strategic Command Joint Force Component
            Command for Integrated Missile Defense;
             The Honorable Dr. Charles McQueary, Director of
            Operational Test and Evaluation, an independent organization at
            the Pentagon;
             Brian Green, Deputy Assistant Secretary of Defense for
            Strategic Capabilities, within the Office of the Under
            Secretary of Defense for Policy; and
             Paul Francis, Director of Acquisition and Sourcing
            Management at the Government Accountability Office (GAO), who
            directed the recent GAO report on missile defense acquisition
            strategy.

        All the witnesses have submitted prepared statements and, without
    objection, your prepared testimony will be entered into the record in
    full. We will keep the hearing record open for 3 days to allow members
    to submit statements or questions for the record.
        There are several key issues we want to discuss today:
        The GAO has raised a number of important acquisition issues related
    to improved oversight and accountability of our missile defense
    programs, and we want to see how we can improve those programs.
        Last year, Congress enacted a provision of law that requires the
    Department of Defense to place a priority on the development, testing,
    fielding, and improvement of effective, near-term missile defenses. We
    want to learn how the Department has implemented that requirement.
        There are many questions about a proposed deployment in Europe of
    long-range interceptors and associated radars, and we need to explore
    those questions.
        Since we all want our missile defense systems to work in an
    operationally-effective, cost-effective, and suitable manner, we need
    to discuss some important testing issues.
        We want to have a good discussion today about missile defense, so I
    would ask the witnesses to provide very brief oral summaries,
    highlighting just a few key points of their testimony. There is a
    possibility of a closed session, if we need to discuss classified
    matters.

                   STATEMENT OF SENATOR JEFF SESSIONS

        Senator Sessions. Thank you, Senator Nelson, and for your
    leadership. I've enjoyed working with you on this subcommittee
    and you understand these issues and care about them, committing
    the kind of time and efforts necessary for us to fulfill our
    responsibilities.
        I want to welcome our witnesses and thank them for their
    service to our country. We've come a long way on missile
    defense over the past few years and we have these gentlemen and
    others ahead of you and working under you now, to thank for the
    progress that's been made.
        If you look back just 3 years ago, we only had the Patriot
    anti-missile system to provide defense, only against short-
    range missile threats like we utilized that Patriot system in
    Israel against SCUDs. Today, our homeland, deployed forces, and
    allies enjoy a limited measure of protection against the full
    range of short and long-range ballistic missile threats. We're
    making some good progress indeed, in a few years. Many thought
    it could never be done.
        Mr. Chairman, in reviewing the press that's leading up to
    this year's deliberations, I get the sense that there may be
    three significant issues that we will need to discuss this
    year.
        First, how much are we going to spend on overall missile
    defense programs? Second, what is the proper balance between
    testing and fielding additional capabilities? Third, whether to
    proceed with plans to field a ground-based interceptor (GBI)
    site in Central Europe?
        On the issue of spending, the budget, as submitted by the
    administration, is already tight. I would point out that the
    fiscal year 2008 request of $8.9 billion for the full panoply
    of missile defense programs is almost $500 million below last
    year's appropriated level. It also represents the development,
    testing, fielding, and sustainment of not just our single
    Ground-Based Midcourse Defense (GMD) System that we talked a
    lot about and gets the most publicity, but a number of systems
    based on land, on our ships at sea, and in the air, which are
    capable of defending against a broad spectrum of short-,
    medium-, and long-range ballistic missile threats.
        Seen in this light, the budget request compares I think,
    favorably with the full suite of aircraft, for example, being
    acquired by the Department of Defense. There is some concern
    expressed that missile defense undergo adequate testing before
    deployment, particularly the GBI.
        While I support rigorous testing, we must remember why
    Congress approved close to simultaneous fielding and testing
    GBIs. It was because of our total vulnerability to long-range
    ballistic missiles. The North Korean ballistic missile test
    last July, coupled with Iran's ballistic missile development,
    and a launch of a sounding rocket in November, confirmed the
    wisdom, I think, of that approach.
        Furthermore the successful intercept test on the GMD system
    last September, in addition to similar successful tests of the
    Patriot, SM-3, and Terminal High Altitude Area Defense (THAAD)
    systems--all in this, included in this funding request--suggest
    there's no reason to curtail planned fielding efforts even
    while we rigorously operationally test these systems.
        Finally, some in Congress have questioned--I don't know on
    this side--but have questioned strategic rational for a GBD
    site in Europe, which will provide protection for most of
    Europe and the United States against the growing long-range
    ballistic missile threat by Iran. I ask my colleagues to
    consider this initiative in the broader context of our defense
    strategy, and would note that just last month, Iran held 15
    British citizens hostage. With ballistic missiles armed with
    weapons of mass destruction, Iran could hold entire cities,
    even nations hostage. A European continent vulnerable to
    Iranian ballistic missile threats could weaken the west's
    resolve in what is shaping up to be a clash of wills with Iran.
        So, Mr. Chairman, thank you again for your leadership, your
    courtesy to me, and all of us on this subcommittee, and I look
    forward to the hearing.
        [The prepared statement of Senator Sessions follows:]

                  Prepared Statement by Senator Jeff Sessions

        Thank you, Mr. Chairman. I also welcome today's witnesses and thank
    them for their service on behalf of the country. We have come a long
    way on missile defense over the past few years and we have these
    gentlemen and the men and women whom they represent to thank. If we
    look back just three years ago, we had only the Patriot anti-missile
    system to provide defense against short-range missile threats. Today,
    our homeland, deployed forces, and allies enjoy a limited measure of
    protection against the full range of short- to long-range ballistic
    missile threats. We are making very good progress, indeed.
        Mr. Chairman, in reviewing the press leading up to this year's
    deliberations, I get the sense there may be three significant issues to
    address this year: First, how much are we going to spend overall on
    missile defense programs; second, what is the proper balance between
    testing and fielding additional capabilities; and third, whether to
    proceed with plans to field a ground-based interceptor site in Central
    Europe?
        On  the  issue  of  spending,  I  would  point  out  that  the
    fiscal  year  2008  request  of  $8.9  billion  is  almost  $500
    million  below  last  year's  appropriated  level  and  represents  the
    development,  testing,  fielding,  and  sustainment  of  not  just  a
    single  missile  defense  weapon  system,  but  a  number  of  systems
    based  on  land,  at  sea,  and  in  the  air--and  capable  of
    defending  against  the  broad  spectrum  of  short-, medium-, and
    long-range ballistic missile threats. Seen in this light, the budget
    request is not unreasonable and compares favorably with, say, the full
    suite of aircraft being acquired by the Department of Defense.
        Some of my colleagues insist that missile defenses undergo adequate
    testing before deployment, particularly the ground-based interceptor.
    While no one argues against rigorous testing, we must remember why the
    Administration, with Congressional approval, chose to simultaneously
    field and test ground-based interceptors--it was because of our total
    vulnerability to long-range ballistic missiles. The North Korean
    ballistic missile tests last July, coupled with Iranian ballistic
    missile development and the launch of a sounding rocket in November,
    confirm the wisdom of this approach.
        Furthermore, the successful intercept test of the ground-based mid-
    course defense system last September, in addition to similar successful
    tests of the Patriot, SM-3, and THAAD systems, suggests there is no
    reason to curtail planned fielding efforts even while rigorous
    operationally realistic testing continues.
        Finally, some in Congress are beginning to question the strategic
    rationale for a ground-based interceptor site in Europe to provide
    protection for most of Europe and the United States against the growing
    long-range ballistic missile threat posed by Iran. I ask my colleagues
    to consider this initiative in the broader context of NATO's diplomatic
    and military strategy for dealing with Iran. Last month, Iran held 15
    British citizens hostage; with ballistic missiles armed with weapons of
    mass destruction, Iran could hold entire cities hostage. A European
    continent vulnerable to Iranian ballistic missile threats could weaken
    the West's resolve in what is shaping up to be a clash of wills with
    Iran.
        Mr. Chairman, I look forward to hearing from the witnesses and
    working through these issues with you as we approach mark-up.

        Senator Bill Nelson. General Obering?

     STATEMENT OF LT. GEN. HENRY A. OBERING, III, USAF, DIRECTOR,
                         MISSILE DEFENSE AGENCY

        General Obering. Good afternoon, Mr. Chairman, Senator
    Sessions, and distinguished members of the subcommittee. I'm
    honored to have this opportunity. I ask that my written
    statement be entered into the record and this afternoon I would
    like to summarize very briefly four key points.
        First, ballistic missile threats are real and growing. Now
    is not the time to cut back America's efforts to defend our
    homeland, our deployed forces, our allies, and friends from
    these threats.
        Second, the integrated layered missile defense system that
    thousands of Americans have been developing, fielding, and
    deploying, works, and is having an operational impact.
        Third, we are developing and fielding missile defense
    capability at an unprecedented pace within our budget
    constraints.
        Fourth, we are gaining widespread international support and
    cooperation. In the last year we have seen aggressive ballistic
    missile development and test efforts in North Korea and Iran,
    as well as the terrorist use of ballistic rockets in attacks
    against Israel. So far this year the pace of foreign ballistic
    missile testing is about twice that of last year. This reflects
    a determination to acquire these valuable weapons, a value
    that's generated by historic lack of deployed forces against
    them.
        Therefore, it is critical that we continue to develop,
    produce, and deploy missile defenses to devalue these weapons.
    Last summer when the North Koreans launched several missiles
    capable of striking our allies and deployed forces in the
    Pacific and an intercontinental ballistic missile (ICBM)
    believed to be capable of striking the United States, we were
    able to provide the President an option. An option to activate
    an integrated missile defense system, a system that I am
    confident would have worked. This confidence is borne in our
    test program, which accounts for almost $2 billion per year,
    now.
        We have taken on the challenge of realistically testing a
    complex system that covers 10 time zones and that intercepts
    warheads in the atmosphere, and in space. The Director of
    Operational Test and Evaluation (DOT&E) and I have approved an
    Integrated Master Test Plan, which includes criteria for
    operational realism.
        In particular, this past September we conducted a long-
    range interceptor flight test that involved the use of
    operational crews, operational fire control, and fielded
    software. We used operational sensors and an operational
    interceptor launched from an operational missile field.
        Over the past year the Missile Defense Agency (MDA) has
    conducted more than 35 major tests and successfully met our
    primary test objectives in 15 of 16 flight tests. Overall since
    2001 we have built a record of 26 successful hit-to-kill
    engagements in 34 attempts. Our test schedule remains very
    aggressive and for the remainder of this year we plan to
    conduct two long-range intercept flight tests, four Aegis
    flight tests, three more THAAD flight tests, one Israeli Arrow
    test, and dozens of ground tests.
        We've also been successful in the unprecedented fielding
    and deployment of capability to the warfighter thanks to an
    underlying acquisition approach that gives us the flexibility
    to manage risk, while continuing to upgrade the system. As a
    result, in just over 30 months, since June 2004, we have in
    place 17 long-range interceptors in Alaska and California.
    We've modified 16 Aegis ships for missile tracking with 7 able
    to launch the 20 sea-based interceptors that we've fielded.
    We've upgraded three land-based early warning radars, delivered
    two transportable radars, and one massive Sea-Based X-Band
    (SBX) radar, and fielded command and control capabilities in
    Hawaii, Alaska, Colorado, Nebraska, Washington, DC, and the
    United Kingdom.
        Using our approach, we have achieved in 2\1/2\ years what
    would have taken two or three times longer with a standard
    process.
        Our acquisition flexibility has allowed us to implement
    numerous cost-saving measures. We have reduced unneeded
    overhead by approximately $1.8 billion from fiscal years 2006
    to 2011. More specifically, we saved enough money in the GMD
    program alone, to purchase four more GBIs.
        The inclusion of U.S. Strategic Command (USSTRATCOM) and
    other combatant commands in our development, test, training,
    and fielding activities has been another key to this success.
    We've worked with them and the Services from defining and
    prioritizing new requirements, to transition and transfer plans
    for operations and support.
        Based on this solid foundation, we are now requesting $8.9
    billion for fiscal year 2008 with more than 75 percent of these
    funds, or $7.1 billion, going to near-term capabilities and the
    remainder, or $1.8 billion allocated to develop defenses
    against the threats that may loom tomorrow. This budget
    reflects a three-part strategy.
        First, we seek $5.9 billion to maintain and sustain an
    additional capability that includes the fielding of up to 44
    long-range interceptors in Alaska and California, deployment of
    up to 132 sea-based interceptors on 18 ships, and deployment of
    2 mobile THAAD fire units with 48 interceptors and, expanding
    our critical command, control, battle management, and
    communications (C2BMC) element. Sustaining this overall
    capability is approaching $1 billion per year.
        Second, we seek $1.6 billion to close gaps and improve our
    capability to keep pace with the growing threats. This
    objective includes the fielding of 10 long-range interceptors
    and a mid-course radar in Europe to defend our deployed forces
    and our allies in that theater, as well as providing additional
    protection to the United States. We have entered into
    discussions with Poland and the Czech Republic to host these
    assets and we've been engaged with our North Atlantic Treaty
    Organization (NATO) partners and the Russians.
        Finally, we request $1.4 billion for the third component of
    our strategy, to develop options for future threats. Options
    which include boost phase defenses and the ability to provide
    persistent, space-based, global detection and tracking.
        Missile defense is global in nature, and we have an
    increasing number of allies and friends joining us in our
    efforts. Japan remains one of our closest partners in missile
    defense. Together, we have successfully flight-tested new nose-
    cone technologies, and agreed to co-develop a larger version of
    the Standard Missile-3 (SM-3).
        We are working closely with the United Kingdom and Denmark
    to upgrade existing early-warning radars. We have also signed
    cooperative agreements with Australia and Italy, and continue
    to work with Israel on both medium- and short-range missile
    defenses. We have begun collaborating our missile defense with
    many, many other nations.
        In closing, I want to emphasize that the threat we are
    facing from ballistic missiles is real and growing. We have
    overcome setbacks and technical hurdles, but thanks to the
    support from Congress, we are succeeding at our mission, and we
    have absolutely no reason to slow down. As we look to the
    gathering clouds of threat on the horizon, now is not the time
    to cut back on support for missile defense, but we think, to
    advance it.
        Thank you for the opportunity to appear before you today,
    and I look forward to your questions.
        [The prepared statement of General Obering follows:]

           Prepared Statement by Lt. Gen. Henry A. Obering III, USAF

        Good afternoon, Mr. Chairman and distinguished members of the
    subcommittee. It is an honor to present the Department of Defense's
    fiscal year 2008 missile defense program and budget.
        I am pleased to report that 2006 was a year of significant
    accomplishment for all aspects of our missile defense program. We made
    substantial progress in developing, testing and fielding an integrated,
    layered Ballistic Missile Defense System (BMDS) to defend the United
    States, our deployed forces, and our allies and friends against
    ballistic missiles of all ranges in all phases of their flight.
        Of the $8.9 billion we are requesting in fiscal year 2008, we will
    allocate $7.1 billion for near-term efforts and $1.8 billion for
    longer-term programs. In the near-term, we seek to build on, and
    sustain, our current capability to defend the homeland against limited
    long-range ballistic missile threats and protect allies, friends and
    deployed forces against short- to medium-range threats. To achieve this
    goal, we intend to complete the fielding of up to 44 Ground-based
    Interceptors (GBIs) in Alaska and California; enhance our early warning
    radars in Alaska, California and the United Kingdom; integrate the Sea-
    based X-band (SBX) radar into the BMD system; deploy up to 132 sea-
    based Standard Missile-3 (SM-3) interceptors on 18 Aegis engagement
    ships; and expand our command, control and battle-management network by
    establishing three new command and control suites at U.S. Strategic
    Command, U.S. Pacific Command, and U.S. Northern Command.
        In the near-term we also seek to close gaps and improve our
    capability to defend against a growing Iranian threat. We will continue
    the initiative we began this year to field 10 long-range interceptors
    and a midcourse radar in Europe. This initiative is essential for a
    robust, layered defense of the homeland against long-range threats from
    the Middle East. It will also extend this defense to our deployed
    forces, allies and friends in the region who currently have no defense
    against longer-range ballistic missiles. To improve our capabilities to
    defeat more complex threat suites, our Multiple Kill Vehicle (MKV)
    program will allow us to engage multiple warheads and countermeasures
    with a single interceptor launch. Delivering this volume kill
    capability is important to the warfighter and is one of our top
    priorities.
        For the longer-term, we are developing the Space Tracking and
    Surveillance System to provide a persistent, near-real-time global
    detection, tracking and fire control capability. This system will
    significantly increase the BMD system's agility and flexibility to
    respond to future worldwide emerging threats. We also continue to
    pursue boost-phase intercept capabilities in order to increase the
    ``depth'' of our integrated, layered system. Boost-phase defenses
    promise to increase our intercept opportunities and destroy enemy
    ballistic missiles when they are most vulnerable. The Airborne Laser
    (ABL) remains our primary boost-phase program. Based on the Defense
    Science Board's recommendation, we're continuing the high-acceleration
    Kinetic Energy Interceptor (KEI) booster development effort as an
    option in the event ABL does not meet critical knowledge points in its
    test program. The U.S.-Japanese cooperative development of a follow-on
    SM-3 interceptor to give the Aegis system an intercontinental ballistic
    missile (ICBM) intercept capability, a robust Sea-Based Terminal
    capability to defeat shorter-range threats, a modest experimental Space
    Test Bed, and our continuing advanced technology efforts all support
    the goal of closing capability gaps in the system.

                       THE EVOLVING SECURITY ENVIRONMENT

        This past 4th of July, millions of Americans were made aware of
    just how real the threat from ballistic missiles is and how vital the
    missile defense program is to our national security. With the launches
    of the short-, medium- and long-range missiles by North Korea, missile
    defense became an urgent matter overnight. Because of the efforts of
    thousands of Americans dedicated to this program, we were able to
    activate a missile defense system to protect the United States had a
    threat emerged.
        In November 2006 and January 2007 Tehran conducted several short-
    and medium-range ballistic missile and rocket launches. In the November
    exercises Iran demonstrated for the world its offensive capabilities
    via televised broadcasts.
        North Korea and Iran dedicate significant resources to acquiring
    ballistic missiles, to include new medium- and intermediate-range
    systems capable of reaching forward-deployed United States forces and
    our allies and friends. North Korea continues to work on
    intercontinental-range systems capable of reaching the United States.
    In addition, our intelligence community assesses that Iran would be
    able to develop an ICBM before 2015 if it chose to do so. With the
    missile firings over the past year, they have also demonstrated the
    ability to conduct coordinated launch operations. But they are not
    alone.
        In 2006 there were about 100 foreign ballistic missile launches
    around the world. This year to date, the pace of testing is about twice
    that of last year--a trend reflecting the determination of many
    countries to acquire these capabilities.
        The actions of North Korea and Iran this past year demonstrate the
    determination of these rogue regimes to achieve this capability and
    potentially weapons of mass destruction to further aggressive ends.
    With the proliferation of ballistic missile technology, we expect to be
    surprised by unexpected and more robust threats. The missile defense
    development program recognizes that we must stay a step ahead of a
    dynamic threat.

                 U.S. BALLISTIC MISSILE DEFENSES--A REPORT CARD

        In January 2002, just a little more than 5 short years ago, the
    Secretary of Defense directed the agency to restructure the missile
    defense program to deal with the urgency, enormity, and complexity of
    developing, testing, and building a missile defense system. This bold
    initiative required the adoption of an evolutionary acquisition
    strategy to be executed by a single agency, a strategy that relies on
    continual assessments of the threat, available technology, and what can
    be built and fielded to provide a militarily useful capability in an
    urgent manner.
        Having capitalized on our steady progress since the 1980s, the
    dedicated men and women of the Missile Defense Agency (MDA) and our
    industrial partners delivered to the combatant commanders in 2004 an
    initial missile defense capability to defeat the near-term long-range
    missile threat. Supported by an extensive command, control, battle
    management, and communications (C2BMC) infrastructure, we connected
    additional system elements to the fire control system and put in place
    trained system operators, the logistics support infrastructure and
    support centers required for this limited operational system.
        To date, we have made significant, and in many ways, unprecedented
    strides to deliver a capability where none existed before. Since 2002
    we have fielded and completed the initial integration of land- and sea-
    based interceptors, mobile and fixed sensors and C2BMC suites to
    deliver one of the most complex and comprehensive defensive
    capabilities ever envisioned. We did so while sustaining an aggressive
    development program that continues to feed new technologies into the
    system.
        Mr. Chairman, the missile defense investments of 4 administrations
    and 11 Congresses are paying off. With the initial deployment of a
    limited missile defense capability, the era of absolute vulnerability
    of our country to a long-range missile attack came to a close. This is
    important, because I believe a capability against even a single reentry
    vehicle has significant military utility. The modest long-, medium-,
    and short-range defensive capabilities we have today can help reduce
    the more immediate threats to our security and enhance our ability to
    defend our interests abroad.
    Long-Range Defenses
        As part of our strategy to protect the United States from ballistic
    missiles launched from North Korea or Iran, we have emplaced high-
    performance interceptors in missile fields at two sites and integrated
    them into the system. The system's GBIs use hit-to-kill technologies to
    destroy intermediate- and long-range ballistic missile warheads in
    space, in the midcourse phase of flight. These are the only weapons we
    have available today to defeat longer-range threats once they have been
    launched. By the end of April, we expect to have 16 GBIs in silos at
    Fort Greely, Alaska, and 2 more at Vandenberg Air Force Base in
    California. We plan to increase interceptor inventories at these sites
    to up to 24 by the end of this year.
        The system today will receive a cue from Defense Support Program
    satellites or from 1 of 16 long-range surveillance and track Aegis
    destroyers that could be stationed near the threat region. These
    satellites and ships can pass detection or cueing data across
    communications lines into BMD system communication and battle manager
    nodes located in Fort Greely and Colorado Springs. Today we stand ready
    to locate and track threats coming out of East Asia using the Cobra
    Dane radar in the Aleutians and the upgraded early warning radar at
    Beale Air Force Base, California.
        Powerful X-band radars located on a mobile platform in the Pacific
    Ocean and at Shariki, Japan can provide precise tracking and
    discrimination to increase the probability we will destroy any lethal
    target. A 2006 independent assessment concluded that the SBX radar,
    which deployed to the Pacific at the end of 2005, is sufficiently
    rugged to operate in the rough seas of the northern Pacific. These
    conditions were validated this past winter when the SBX experienced
    extremely hazardous weather with negligible impact. Also in 2006, we
    deployed the first forward-based X band radar to Japan, accelerating
    its deployment and supporting C2BMC equipment to its operational
    location in Shariki Japan, achieving partial mission capability in
    October 2006.
    Short- to Medium-Range Defenses
        Since 2004 we have expanded and improved terminal and midcourse
    defenses to defeat short- and medium-range threats from land and sea.
    Aegis ships have been periodically put on station in the Sea of Japan
    to provide long-range surveillance and tracking data to our battle
    management system. We began fielding SM-3 interceptors in 2004,
    evolving to a more capable interceptor. With our growing inventory of
    SM-3 interceptors on Aegis ships, we can provide a flexible sea-mobile
    capability to defeat short- to intermediate-range ballistic missiles in
    their midcourse phase. In 2005 we upgraded the first Aegis cruisers for
    the engagement mission. Today we have available three Aegis BMD
    engagement cruisers and four engagement destroyers.
        Having successfully transitioned the Patriot Advanced Capability-3
    (PAC-3) to the U.S. Army in March 2003, we continue to maintain
    configuration control and work with that Service to improve and upgrade
    PAC-3 and Medium Extended Air Defense System performance. Today, PAC-3
    fire units are being integrated into the forces of our allies and
    friends, many of whom face immediate short- and medium-range threats.
    Integrating the System
        For the BMDS to work effectively, all of its separate elements must
    be integrated across several combatant commands. This capability allows
    us to mix and match sensors, weapons, and command centers to
    dramatically expand detection and engagement capabilities over what can
    be achieved by the system's elements operating individually. Combatant
    commanders can use the C2BMC infrastructure to enhance planning,
    synchronize globally dispersed missile defense assets, and manage
    weapon inventories. These capabilities also can provide our senior
    government leadership situational awareness of ballistic missile
    launches and defense activities. Today we have in-place a planning
    capability within U.S. Strategic, Northern, and Pacific Commands.
    Supporting the Warfighter
        This past year we continued work with U.S. Strategic Command and
    other combatant commands to train missile defense crews at all
    echelons, ensuring that they can operate the BMDS if called upon to do
    so. We established a BMD Operations Watch Officer to provide real-time
    BMD situational awareness, operational status, and coordinate the
    configuration of the system and have executed a series of exercises,
    which involve temporarily putting the system in a launch-ready state.
        We have set up a process to collaborate with the combatant
    commanders and the military Services to define and prioritize
    requirements as the system evolves. For example, we did not have a sea-
    based terminal layer planned for the program until the Commander of
    U.S. Strategic Command identified this as a desired capability. Once
    this need was identified, we worked with the Navy to define and budget
    for near- and far-term programs for a Sea-Based Terminal defense. We
    also have worked closely with the Services and the Office of Secretary
    of Defense on transition and transfer activities to address operations
    and support of the system elements. The Deputy Secretary of Defense
    identified lead military departments for eight elements of the BMDS,
    and the Navy has just agreed to take on lead service responsibility for
    the SBX Radar. We have developed Transition and Transfer Plans with the
    Services and the combatant commands. These plans capture both
    agreements and the roles and responsibilities associated with evolving
    operations and support activities. This collaboration with the
    warfighter includes training, testing, wargaming, and conducting
    exercises and simulations, all of which help demonstrate and improve
    the capability and reliability of the missile defense system.
    BMD System On Alert
        As I stated earlier, when the North Koreans conducted their
    launches last summer, for the first time in the history of the United
    States, we had the capability to defend our people against a long-range
    missile had it been necessary. Working closely with U.S. Strategic
    Command's Joint Functional Component Commander for Integrated Missile
    Defense, we successfully took the system out of the development mode
    and handed it over to the warfighter for operation. This activation of
    the system last June helped us to refine procedures and taught us
    invaluable lessons about system operations.
        Alert activities included activation of the Ground-based Midcourse
    Defense and the deployment of a missile defense capability to the Sea
    of Japan. We had Aegis long-range surveillance and track ships
    stationed east and west of Japan during the missile firings. Data
    collected from these sensors would have helped identify whether the
    long-range launch was a ballistic missile or a space launch vehicle and
    would have provided tracking data to the system. The C2BMC situational
    awareness displays were operational and being monitored at the various
    commands.
        We also accelerated the capability of the forward-based X-band
    radar in Japan for data collection. The SBX radar was stationed off
    Hawaii and similarly standing by for data collection. At the time, the
    forward-based radar and the sea-based radar were not integrated into
    the system. Given these events from last summer and our ability to
    bring the system on line and prepare it for emergency use, I am very
    confident that the system would have operated as designed had the Taepo
    Dong-2 threatened the United States.
        We have an operational system today because of the capability-based
    acquisition approach we have followed since 2002. This approach
    leverages collaboration with the warfighter community throughout
    development and testing to the point where we transition or transfer
    capabilities to the operators. Some have asserted that our
    nontraditional approach lacks discipline, transparency, and/or
    accountability. I do not agree. I think the progress we have made to
    date in fielding a missile defense capability speaks for itself and
    justifies the continuation of this approach. Had we followed the
    traditional acquisition approach, we would not have had an operational
    capability to respond to the potential threat from North Korea. Had we
    followed the traditional approach, I believe we truly would have
    ``delivered less at a higher cost.''
        The missile defense program is highly scrutinized by the Department
    of Defense, the Congressional Budget Office, the Government
    Accountability Office, and Congress. In 2004, Congress required the MDA
    to submit a cost, schedule and performance baseline for each block
    configuration of the BMDS being fielded. We have complied with this law
    every year, describing our baseline in terms of 2-year increments of
    capability called fielding blocks. From an acquisition process
    perspective, I understand that we are blazing new trails, and the
    information we provide is therefore different from what people are used
    to seeing. I understand the onus is on us to clearly convey to Congress
    that we are fielding ballistic missile defense capability in a
    responsible and transparent manner, and I am committed to doing that. I
    have therefore directed my staff to complete a review of our current
    approach and look at ways to better describe our baseline program.

                   BUILDING CONFIDENCE THROUGH SPIRAL TESTING

        Testing under operationally realistic conditions is an important
    part of maturing the system. We have been fielding test assets in
    operational configurations in order to conduct increasingly complex and
    end-to-end tests of the system. While the BMD system is a developmental
    system, it is available today to our leadership for activation to meet
    real world threats. Given this dual function of the test bed, the
    Operational Test Agencies and the warfighting community are very active
    in all phases of our test planning, execution, and post-test analysis.
        Using criteria established by the Agency's system engineers and our
    warfighters, all system ground and flight tests provide data that we
    and the operational test community use to verify the system's
    functionality and operational effectiveness. Our flight tests are
    increasing in operational realism, limited only by environmental and
    safety concerns. Each system test builds on the knowledge gained from
    previous tests and adds increasingly challenging objectives, with the
    downstream goal of devising scenarios that test elements of the system
    from end-to-end. This spiral test approach increases knowledge of, and
    confidence in, the system performance while maintaining safety and
    minimizing artificiality.
        Last year I explained that we had several concerns with quality
    control and reliability that led to two successive Ground-based
    Midcourse Defense test aborts, problems that we have since
    comprehensively addressed. The independent review team concluded that
    the deficiencies in systems engineering, ground qualification testing,
    flight test readiness certification, contractor process control and
    program scheduling were not systemic and did not compromise initial
    defensive capabilities. I testified last year that I did not view the
    failures as major technical setbacks.
        Coming off the very successful fly-out of the operational
    configuration long-range interceptor in December 2005, we conducted a
    long-range intercept flight test last September that exceeded our
    objectives. That complex test involved an operational interceptor
    launched from an operational silo at Vandenberg Air Force Base,
    operational sensors, and operationally trained crews manning
    operational fire control consoles. The test demonstrated the
    functionality of the Exo-atmospheric Kill Vehicle and the ability to
    engage a threat-representative target using the Upgraded Early Warning
    Radar at Beale Air Force Base in California. After the kill vehicle
    acquired the target launched out of the Kodiak Launch Complex in Alaska
    nearly 3,000 km away from the engagement zone, it successfully
    intercepted it. While it was not hooked into the system, we also
    demonstrated the powerful contributions the SBX radar can make in the
    areas of tracking and discrimination. This was our most operationally
    realistic, end-to-end test of the system involving the Ground-based
    Midcourse Defense element to date.
        Over this past year the MDA conducted more than 35 major tests and
    successfully met our primary test objectives in 14 out of 15 flight
    tests. In fact, during a 90-day period last summer, we achieved
    successful hit-to-kill intercepts in the lower atmosphere with the PAC-
    3, in the upper reaches of the atmosphere with the Terminal High
    Altitude Area Defense element, and in space with the Aegis SM-3 and the
    Ground-Based Midcourse Defense elements. Including tests of the PAC-3,
    we achieved seven hit-to-kill intercepts of ballistic missile targets
    in eight attempts in 2006. Since 2001, we have built a record of 26
    successful hit-to-kill engagements in 34 attempts. Our test plans for
    2007 and 2008 will continue to use more complex and realistic scenarios
    for system-level flight tests.
        We plan three more long-range interceptor flight tests by the end
    of this year that continue to push the edge of the envelope in testing
    complexity. All tests will continue to use operationally trained crews
    and the operational launch site at Vandenberg. We plan to integrate the
    SBX radar into the system for the intercept test in late summer as we
    continue to expand the number of sensors available to us to cue the
    system and engage targets.
        On June 22 of last year, we successfully used a U.S. Navy Aegis
    cruiser to engage a separating target carried on a threat-
    representative medium-range ballistic missile. As we had done in the
    past three flight tests, we did not notify the operational ship's crew
    of the target launch time, and they were forced to react to a dynamic
    situation. The role of the crew is an important part of our ability to
    engage hostile missiles, and last December we increased test complexity
    by attempting a simultaneous engagement of aerial and ballistic targets
    and by using operator-selectable parameters to allow for automatic
    identification of targets. A crew member changed the ship's doctrine
    parameters just prior to target launch. This modification prevented the
    ship's fire control system from conducting the planned ballistic
    missile and aerial target engagements. The primary target was a very
    short-range ballistic missile, and thus there was insufficient time for
    manual engagement. When the SM-3 interceptor failed to launch, we
    aborted the launch of the SM-2 interceptor. This is another example of
    why we conduct tests--to expose flaws in the system and wring out
    operational procedures. We are working to resolve the problem we
    experienced in the test last December and expect to conduct it again
    this spring.
        We plan four more Aegis intercept flight tests in 2007. We will
    again demonstrate the integration of the Aegis BMD weapon system into
    the overall BMD system and evaluate the ship crew's performance in
    executing an operationally realistic BMD mission. Early this summer, we
    will attempt an intercept of a separating, medium-range target using
    the SM-3 Block IA interceptor. Later this year, we will demonstrate the
    ability to engage two near-simultaneous short-range unitary targets.
    Also late in 2007, as part of our growing partnership with Japan, a
    Japanese Maritime Self Defense Force Kongo-class ship will attempt to
    engage a medium-range ballistic missile separating target using the
    Block IA SM-3 interceptor. This will be the first such firing by a
    maritime ally. In 2008 we will engage a separating intermediate-range
    ballistic missile target using off-board sensor information to launch
    the interceptor. We will also attempt a second sea-based intercept test
    with our Japanese partners.
        As I mentioned earlier, flight-testing involving the redesigned
    Terminal High Altitude Area Defense (THAAD) interceptor continued last
    July with a successful engagement of a unitary target high in the
    atmosphere. In September we again sought to demonstrate the performance
    of the new missile and the ability to integrate it into the BMD system,
    but we were unable to do so following the failure of the target
    missile. This past January and earlier this month, we again
    successfully destroyed short-range targets. These endo-atmospheric
    engagements were the first such tests of the THAAD interceptor at the
    Pacific Missile Range Facility. To demonstrate the capability of the
    THAAD fire unit to intercept at different altitudes in the atmosphere
    and in low exo-atmosphere, we plan one more intercept test in space
    later this year against a unitary target. In 2008 we plan to
    demonstrate interceptor capabilities against more stressing targets. We
    will conduct two intercept tests involving the THAAD interceptor, one
    against a separating target in space, and the other against a
    separating target high in the atmosphere. Further, the first test in
    2008 will include the launch of two THAAD interceptors. The MDA will
    also participate in Patriot combined developmental/operational tests as
    well as Air Force Glory Trip flight tests.
        In 2007 we will continue with our successful ground testing, which
    involves warfighter personnel and test hardware and software in the
    integrated system configuration to demonstrate system connectivity and
    interoperability. Upcoming tests will verify integration of the sea-
    based, forward-based, and Fylingdales radars. The funds we are
    requesting will support additional capability demonstrations and
    readiness demonstrations led by the warfighting community. We currently
    cannot test and train on the system while it is in full operational
    mode. To address this problem, we are developing a capability to
    support continued research, development, test, evaluation, and
    maintenance while concurrently sustaining operational readiness.
        Based on the many tests we have conducted to date, we maintain our
    confidence in the BMD system's basic design, its hit-to-kill
    effectiveness, and its inherent operational capability. We continue to
    work closely with the Director, Operational Test & Evaluation,
    Operational Test Agencies, and combatant commanders to characterize the
    effectiveness and readiness of the system at every stage in its
    development and fielding. We are developing the capability to conduct
    concurrent test, training, and operations, which will allow combatant
    commanders to keep the system in operational mode while we test, train,
    and make improvements to the system.

                           BMD SYSTEM FIELDING PLANS

    Maintaining and Sustaining the Capability
        The top priority of the MDA is to maintain and sustain the deployed
    initial capability to stay ahead of the North Korean and Iranian
    threats. This means improving long-range capabilities for homeland
    defense and moving forward with initial defenses to protect allies and
    U.S. interests abroad against shorter-range ballistic missiles.
        Our program strategy completes the fielding of GBIs in Alaska and
    California. We will begin construction in 2007 of a third missile field
    at Fort Greely and accelerate delivery of interceptors. We also will
    begin increasing the number of interceptors available at Vandenberg Air
    Force Base from two to four. An additional fifth silo at Vandenberg
    will be dedicated to testing. We will have up to 30 long-range
    interceptors deployed by the end of 2008. For midcourse capability
    against the long-range threat, the Ground-based Midcourse Defense
    element budget request for fiscal year 2008 of about $2.5 billion will
    cover continued development, ground- and flight-testing, fielding and
    support.
        To address short- to intermediate-range threats, in 2006 we added
    one Aegis engagement cruiser, for a total of three, and three Aegis
    engagement destroyers. As we convert destroyers this year to add the
    engagement capability, the number of long-range surveillance and track
    ships will fall from 10 at the end of 2006 to 7 and our total number of
    fully BMD-capable Aegis engagement ships (cruisers and destroyers) will
    climb to 10. By the end of 2008, we plan to have 13 Aegis engagement
    destroyers and 3 engagement cruisers and 40 interceptors in inventory.
    System tests will involve further demonstrations of the sea-based
    interceptor, and we will continue enhancing the system's discrimination
    capability. For fiscal year 2008, we are requesting approximately
    $1.044 billion to continue Aegis BMD development and testing.
        To supplement the Cobra Dane and Beale radars, we will finish the
    integration work on the Royal Air Force Fylingdales early warning radar
    in the United Kingdom. It will be fully operational by the end of this
    year. This radar will provide coverage against Middle East launches
    against the United States and our allies in Europe. Our fiscal year
    2008 budget request for BMD radars is $758 million. These funds will
    continue forward-based radar integration work and complete construction
    of a permanent basing site at Shariki Air Base. We will also have
    available for deployment a second forward-based X-band radar.
        With this year's budget request of $247 million for the C2BMC
    activity, we will continue to use spiral development to incrementally
    develop, test, and field hardware and software improvements leading to
    a robust, net-centric missile defense capability that fights as a
    system. We have made incredible progress in this area despite
    decrements in funding over the past couple of years. Our ability to
    defend against highly lethal threats or operate in a very complex,
    stressing battle environment spanning multiple theaters requires all
    missile defense elements, which may be spread over thousands of miles,
    to work together as a ``team.'' Today we can do that. I am very proud
    of what our national team for integration has achieved. We will press
    on with the development of the Global Engagement Manager at the Pacific
    Air Operations Center and integrate into the system the forward-based
    radar in Japan, the SBX radar, and the Fylingdales radar. We plan to
    install additional planning and situational awareness capabilities to
    facilitate executive decisionmaking in the European Command and the
    Central Command by 2009.
    Closing Capability Gaps
        Our long-term strategy is to make the system more robust, reliable,
    and flexible in order to close gaps in our missile defense
    capabilities. In line with our multilayer approach, the missile defense
    program in fiscal year 2008 and beyond will expand terminal defense
    protection, upgrade and improve midcourse discrimination and firepower,
    strengthen the capability of the BMDS to defeat coordinated attacks,
    and place increasing emphasis on boost phase defenses.
        The missile defense program will improve coverage of the United
    States and, for the first time, extend coverage to Europe against
    longer-range ballistic missiles. We have agreed with Poland and the
    Czech Republic to begin focused discussions on the deployment of long-
    range interceptors and a midcourse discrimination radar. If
    negotiations are successful, we plan to modify the X-band radar
    currently located on the Kwajalein Atoll and relocate it to a site in
    the Czech Republic. The deployment of this X-band radar in Europe will
    complement sensor assets deployed in the United Kingdom and Greenland.
    In addition to increasing the number of long-range interceptors
    emplaced at missile fields in Alaska and California, we are hopeful
    that successful completion of negotiations with the Government of
    Poland will allow us to start emplacing 10 GBIs in Poland beginning in
    2011.
        We also are developing the MKV system to upgrade long-range
    interceptor performance by attaining a volume kill capability to defeat
    multiple reentry vehicles and midcourse countermeasures. We have
    restructured the MKV program to develop land- and sea-based interceptor
    payloads by the middle of next decade. Besides bringing several kill
    vehicles to the fight, the MKV system will provide critical tracking
    and discrimination information to other system sensors and interceptors
    and assist with kill assessment. We have requested $265 million for
    this work in fiscal year 2008.
        This budget submission also continues the upgrade of the Thule
    early warning radar in Greenland and its integration into the system by
    2009. Together with the radars in California, Alaska, and the United
    Kingdom, the Thule radar will ensure full coverage of the United States
    against threats from the Middle East. We will also continue to enhance
    additional forward-based X-band radar capabilities in Japan and other
    operating locations to meet warfighter needs.
        We also will bolster defenses against short- to medium-range
    threats by increasing the inventory of Aegis BMD sea-based interceptors
    from 86 to 132 by 2013. Upgrades to the SM-3 include improvement of the
    Divert and Attitude Control System and discrimination performance. We
    also will provide a full upgrade of the Aegis BMD Weapon System to
    improve its ability to detect, acquire, and intercept more diverse,
    longer-range threats. At the end of the decade we will integrate Aegis
    BMD with the Navy-developed Open Architecture system to remain
    compatible with Navy ships following modernization.
        We will field 2, and future plans call for 4, THAAD fire units,
    which consist of radars and 96 interceptors. THAAD will provide
    transportable terminal protection for our troops and areas along the
    U.S. coasts or on the territories of our allies. The first unit will be
    fielded in 2009, with subsequent units fielded by 2012. We are
    requesting $858 million in fiscal year 2008 for THAAD development and
    fielding.

                       DEVELOPING OPTIONS FOR THE FUTURE

        We do, of course, need to address far-term threats. In simplest
    terms, that means managing a program that balances initial, near-term
    fielding of system elements with long-term development. I continue to
    be a firm believer in the balanced program, because it neither
    compromises our security in the present nor short-changes our future
    safety. This approach recognizes the urgency of fielding capabilities
    to address threats we face today and the necessity of continuing
    support for vigorous development activities to prepare for tomorrow's
    ballistic missile challenges to our security.
        I am in strong agreement with the members of the House Armed
    Services Committee, who recently concluded that the country's missile
    defense program ``must be scalable in response to the evolution of the
    threat.'' \1\ The MDA plans to develop options for incrementally
    fielding elements of the BMDS. We will do this by leveraging a key U.S.
    strength, our technological advantage, and by building with our allies
    a foundation of global access and response.
    ---------------------------------------------------------------------------
        \1\ House Armed Services Committee, Committee Defense Review
    Report, December 2006, p. 104.
    ---------------------------------------------------------------------------
        In executing our program we continue to follow a strategy of
    retaining alternative development paths until capability is proven--a
    knowledge-based funding approach. That means we are setting specific
    targets, or knowledge points, that the development efforts have to
    reach to demonstrate a specific capability.
        There are several important development efforts funded in this
    budget. A significant part of missile defense investment has been
    devoted to the development of terrestrial boost phase defenses to
    supplement currently fielded midcourse and terminal defenses. An
    operational ABL could provide a valuable boost phase defense capability
    against missiles of all ranges. We restructured the KEI activity to
    focus on development of a high-acceleration booster, one that is more
    capable than any booster we currently have in inventory. Either ABL or
    the kinetic energy booster will be selected as the primary boost phase
    program upon completion of critical knowledge points before 2010.
        Over the past 2 years we have demonstrated in ground tests the
    power and reliability of the ABL high energy lasers. We also have
    tested the command and control and passive target detection systems in
    flight. In 2006 we refurbished the high energy laser optics and
    completed integration and ground testing of the low-power tracking and
    beacon illuminator lasers. This year we will flight test the beam
    control and atmospheric compensation against a cooperative airborne
    target. Earlier this month, we reached an important milestone in this
    program when we conducted the first in-flight test of the laser
    targeting system, successfully demonstrating a technology that will
    help track a boosting ballistic missile and identify the most
    vulnerable sections on the rocket motor case to be hit by the high
    energy laser. We recently completed major structural modifications to
    the Boeing 747 aircraft to support installation of the high energy
    laser, which will continue in 2008. The $516 million we request in
    fiscal year 2008 will complete integration of the high energy laser
    modules with the modified aircraft as we prepare for a lethal shootdown
    of a ballistic missile target in 2009. Despite the continued technical
    challenges we face, I remain optimistic that we can produce an
    operationally effective directed energy capability.
        We have made good progress in our high-acceleration booster
    development effort. This past year we successfully conducted the first
    static firings of the first and second stage boosters and demonstrated
    overhead non-imaging data fusion processing within the prototype fire
    control component. This high acceleration booster also would enhance
    the performance of the currently deployed GBI. Within the restructured
    program we will maintain options to develop a land-mobile launcher and
    fire control system as well as an option for a sea-based capability. We
    are requesting $214 million in fiscal year 2008 for this activity.
        We plan to develop space-based sensors to provide a persistent
    identification and global tracking capability. A small constellation of
    Space Tracking and Surveillance System (STSS) satellites will enable
    operation of the missile defense system worldwide, independent of
    terrestrial-based sensors along the threat trajectory. These sensors
    will be able to detect and track enemy ballistic missiles and payloads
    through all phases of flight and close the system fire control loop
    globally. We are on track to launch two demonstration satellites in
    November 2007. Next year, following on-orbit check-out, these
    demonstration satellites will perform live target acquisition, tracking
    and handover. We are requesting approximately $319 million in fiscal
    year 2008 to execute the STSS activity.
        We have learned a great deal from the ground-testing of the STSS
    Block 2006 sensors in representative, thermal vacuum conditions. We
    have proven that this class of sensor will achieve the necessary
    sensitivity to support intercepts. Given the long design timelines for
    space systems, we are requesting funding in fiscal year 2008 to begin
    work on the follow-on constellation. Postponing the start of this phase
    of the program will delay our ability to achieve a necessary global
    sensor and fire control capability.
        Later this month we are launching a satellite, the Near Field
    Infrared Experiment (NFIRE), to collect high resolution infrared
    phenomenology data from boosting targets. Following preparation of the
    satellite once it is on-orbit, in August and October 2007, we will
    conduct tests using live ballistic missile targets. The data from NFIRE
    will be fed into simulation models and contribute to the future sensor
    designs.
        We will continue work with Japan to increase SM-3 range and
    lethality. The development of the 21-inch M-3 Block IIA interceptor
    will increase our capability to engage longer-range ballistic missiles
    from Aegis BMD platforms and help close a capability gap around 2015.
    We have requested $74 million in fiscal year 2008 as part of our
    cooperative work with Japan to purchase long-lead items required for
    the development of this interceptor.
        Another capability gap exists in terminal defense against short-
    and medium-range ballistic missiles. For the past 2 years, the Navy and
    the MDA have collaborated on plans for a Sea-Based Terminal defensive
    layer. In May 2006 we demonstrated the feasibility of developing a
    limited near-term capability against a short-range ballistic missile
    using a modified SM-2 Block IV interceptor. Based on this
    demonstration, we are upgrading the Aegis weapon system, and the Navy
    is upgrading the SM-2 Block IV missile, the goal being to install a
    terminal engagement capability on 18 Aegis BMD ships beginning in 2009.
    We also are examining with the Navy options for developing a far-term
    improved capability to address short- and medium-range threats. Our
    fiscal year 2008 request for Sea-Based Terminal development work is $75
    million.
        The next generation of C2BMC capability will be essential if we are
    to close gaps in our command seams. As we deliver more sensor and
    interceptor capability into the hands of the warfighters, they are
    faced with several more options to defend their areas of
    responsibility. We must continually refine our C2BMC capability to
    allow the warfighters to rapidly process all of the available options,
    plan for the employment of BMDS assets, and globally manage the
    execution of the system on tight timelines. The battlefield effect is
    that the integrated BMD system can defend against more missiles
    simultaneously, reduce risk of missiles leaking through our defenses,
    conserve more interceptor inventory, and defend a larger area.
        Finally, I am deeply concerned about future threat uncertainty and
    worldwide ballistic missile proliferation. I believe the performance of
    the BMD system could be greatly enhanced by an integrated, space-based
    layer. Space systems could provide on-demand, near global access to
    ballistic missile threats, minimizing the limitations imposed by
    geography, absence of strategic warning, and the politics of
    international basing rights. A space layer would apply pressure on
    launches from land or sea, depriving the adversary of free rides into
    midcourse with advanced countermeasures. While deployment of such a
    system must be preceded by significant, national-level debate, that
    debate must be informed by science. To that end, we are ready to begin
    a focused investigation of the feasibility of having an integrated
    space-based layer, and I am requesting $10 million for fiscal year 2008
    to begin concept analysis and preparation for small-scale experiments.
    These experiments will provide real data to answer a number of
    technical questions and help the leadership make a more informed
    decision about adding this capability.
        We have had to restructure some development activities and cancel
    others as a result of congressional and departmental reductions in the
    MDA budget. The following program activities have been delayed:
    delivery of the first operational STSS satellite has slipped from 2012
    to the 2016-2017 timeframe, prolonging the time we will be without a
    capability to integrate the system globally; and the scope of the KEI
    activity has been reduced to focus on booster development and delay
    work on system integration, battle management, and fire control. The
    reductions also have impacted work in the area of innovative technology
    development. I regret that we have had to cancel the advanced
    technology development work associated with our micro-satellite
    activities and eliminate funding for the High Altitude Airship beyond
    fiscal year 2007.

                          INTERNATIONAL PARTICIPATION

        The global nature of the threat requires that we work closely with
    our allies and friends to develop, field, and operate missile defenses.
    I am pleased to report that many governments share our vision for
    missile defense. This past year we continued to build on a very
    successful program to involve more countries and forge international
    partnerships. Without the participation of our allies and friends, the
    BMDS would look very different.
        The Government of Japan remains solidly behind missile defense and
    has even accelerated its program to field multilayered missile defenses
    that are interoperable with the U.S. system. Japan continues to upgrade
    its Aegis destroyers and acquire SM-3 interceptors. In March 2006 we
    successfully flight-tested new nosecone technologies developed in
    cooperation with Japan. Additionally, the MDA and Japan have agreed to
    co-develop a Block IIA version of the SM-3, which will improve our
    defensive capabilities against longer-range missiles. Japan also is
    upgrading its Patriot fire units with PAC-3 missiles and improved
    ground support equipment. In 2008 Japan is expected to begin co-
    production of the PAC-3 missile.
        The upgraded Royal Air Force Fylingdales radar in the United
    Kingdom will undergo operational testing this year. Once we certify the
    radar, it will provide the system critical early warning, tracking and
    cuing data needed to defeat threat missiles coming out of Iran. We are
    working closely with Denmark to upgrade the Thule early warning radar
    in Greenland to improve its capability to detect and track ballistic
    missiles.
        Later this year we will conduct satellite-to-ground and satellite-
    to-satellite communication experiments with a German-built Laser
    Communications Terminal installed in the NFIRE satellite. Together with
    an identical terminal on a German satellite, the United States and
    Germany will perform joint experiments to validate the use of laser
    technology for high speed space communications.
        The United States and The Netherlands have been working together to
    modify Dutch frigates with a combat system to enable ballistic missile
    detection and tracking. An upgraded air command and defense frigate
    from The Netherlands successfully detected and tracked the targets in
    the December 2006 Aegis ballistic missile defense flight test.
        We are continuing work with Israel to implement the Arrow System
    Improvement Program and enhance its capability to defeat longer-range
    ballistic missile threats emerging in Iran. We are also conducting a
    feasibility study on a joint development program called David's Sling
    for shorter-range missile defense.
        We continue to support our North Atlantic Treaty Organization
    (NATO) partners in advancing the dialogue on the political-military
    implications of defending European population centers against longer-
    range missile threats. The MDA is supporting the NATO Active Layered
    Tactical Ballistic Missile Defense Program Office to develop a
    capability to protect deployed forces by 2010.
        I am also pleased to announce that this past February we put in
    place a Framework Memorandum of Agreement with Italy and we can now
    begin to develop opportunities for missile defense technology sharing,
    analysis, and other forms of collaboration. We have other international
    interoperability and technical cooperation projects underway, for
    example with Australia, and are working to establish formal agreements
    with other governments.

                                    CLOSING

        Mr. Chairman, in closing, some have said that the Defense
    Department's investments in missile defense are misdirected, that other
    threats are more pressing. Others have said we are spending too much
    money on missile defense and that it is too expensive. Still others
    have claimed that we should slow down fielding activities until the
    technologies are more mature.
        I disagree with these critics, Mr. Chairman. We must meet the
    rising threats posed by ballistic missiles. We have seen rogue nations
    test these weapons in the past year. Ballistic missile defense is
    expensive, but the dollar investment in this nation's security pales in
    comparison to the overwhelming price this nation would pay in lives,
    social dislocation, and economic devastation from a single missile
    impacting an American metropolitan area. Indeed, the success we have
    seen in our comprehensive test program indicates that there is no
    reason to slow down.
        In less than 3 short years, thanks to the dedication of thousands
    of men and women across this country and a first-class, cutting-edge
    defense industry, we have deployed missile defenses to protect our
    homeland, our troops deployed to dangerous regions around the world,
    and our allies and friends. But we have a long way to go. So now is not
    the time to cut back missile defense. Now is the time to accelerate it.
        Thank you and I look forward to your questions.

        Senator Bill Nelson. General Campbell?

     STATEMENT OF LTG KEVIN T. CAMPBELL, USA, COMMANDING GENERAL,
     U.S. ARMY SPACE AND MISSILE DEFENSE COMMAND/U.S. ARMY FORCES
     STRATEGIC COMMAND AND JOINT FUNCTIONAL COMPONENT COMMAND FOR
                       INTEGRATED MISSILE DEFENSE

        General Campbell. Chairman Nelson, Senator Sessions, and
    members of the subcommittee, thank you for having us here
    today. We appreciate your support.
        I'm going to address four aspects of my role, the role as
    the Joint Functional Component Command for Integrated Missile
    Defense under General Cartwright at STRATCOM. The assessment of
    the capabilities that we have today, the role of the warfighter
    in the development process, and finally, my role as the Army's
    senior Space and Missile Defense Commander (SMDC).
        In our role as the Joint Component, we plan, integrate and
    coordinate global ballistic missile defense (BMD) operations.
    This includes developing plans and concepts, it includes
    planning exercises and executing exercises that cut across all
    of the Combatant Commanders--European Command, Northern
    Command, as well as Pacific Command, and STRATCOM.
        Starting in July 2006, when the North Koreans had several
    missile test flights, we successfully placed this system on
    alert, and it demonstrated, in my view, our ability to operate
    the system on a sustained basis, and also to dynamically plan
    across three separate combatant commanders in their real time.
    So, it validated that our procedures were very good at that
    point in time.
        I think our success is related to two particular
    activities, one is the exercise program, and the second is the
    MDA's test program, which we participate in. In the past 12
    months, we've had three major exercises across the three
    combatant commanders, and we've participated in several of the
    GMD tests in which soldiers, sailors, marines, and airmen
    operate their systems. These tests and exercises have enabled
    us to improve our efficiency, both at staff levels, as well
    down at the individual soldier level.
        My assessment, in terms of the near-term, I think we're
    very limited. The principal limiting factor is typically
    missile inventory, although in the lower tiers, we do need more
    Patriot Systems, and I think we're going to solve this when we
    bring THAAD, when we bring on additional Aegis BMD capability.
    I think that the potential expansion into Europe with the GMD
    system, which we think is essential, will thicken our defense
    for the homeland, and expand it to our allies and forward-
    deployed forces.
        In our warfighter role, in terms of advocacy, we have a
    very deliberate and disciplined process within USSTRATCOM,
    which gathers all of the inputs from the combatant commanders
    and we present those to General Obering at the MDA. We've been
    able to work a number of issues, we've seen improvements in
    fielded systems, and we've made recommendations that they
    pursue systems, such as the Multiple Kill Vehicle (MKV), which
    we think is important for future threats.
        In my role as the Army SMDC, we ensure that our forces have
    those capabilities necessary to handle the theater-level
    missile threats. We're transforming that force, we're taking it
    from separate systems, integrating those systems into a system
    of systems so such systems as Patriot, THAAD, the surface-
    launched medium-range missile, and the elevated sensor are the
    type systems that we're netting together. I think when we do
    this, a combatant commander then can take those capabilities
    and better tailor and scope them to his needs in his particular
    theater.
        So, with your help, we're going to continue forward
    progress in this endeavor, in fielding an integrated missile
    defense for our homeland, deployed forces, friends, and allies,
    and I thank you again for having us, and I look forward to your
    questions.
        [The prepared statement of General Campbell follows:]

                Prepared Statement by LTG Kevin T. Campbell, USA

                                  INTRODUCTION

        Chairman Nelson, Ranking Member Sessions, and members of the
    subcommittee, thank you for your ongoing support of our military and
    for the opportunity to appear before this panel. In my view, this
    committee is a strong ally of the Army and the missile defense
    community, particularly in our continuing efforts to field missile
    defense forces for the Nation and our allies. I consider it a privilege
    to be counted in the ranks with my fellow witnesses as an advocate for
    a strong global missile defense capability.
        My current responsibility entails two roles. The first is as the
    Army's senior commander for space and missile defense. The second role
    is as a soldier on the Joint Missile Defense Team and Commander of the
    Joint Functional Component Command for Integrated Missile Defense, a
    part of the U.S. Strategic Command. In this role, I serve as the Joint
    user representative working closely with the Missile Defense Agency
    (MDA), other Services, and combatant commanders to ensure that our
    national goals of developing, testing, and deploying an integrated
    missile defense system are met in an operationally sound configuration.
        Chairman, as proven during last year's July 4th North Korean
    missile launches, Army Soldiers are trained and ready to operate the
    Ground-Based Midcourse Defense (GMD) Element of the Ballistic Missile
    Defense System (BMDS) at Fort Greely, Alaska, and the Joint National
    Integration Center at Schriever Air Force Base in Colorado. These
    Soldiers, as part of the Joint team, continue to serve as our Nation's
    first line of defense against a rogue nation's launch of an
    intercontinental ballistic missile toward our shores. I am proud to
    represent them along with the other members of the Army and Joint
    integrated missile defense community.

                    UNITED STATES STRATEGIC COMMAND JFCC-IMD

        The Joint Functional Component Command for Integrated Missile
    Defense (JFCC-IMD) was established in January 2005 as one element of
    the U.S. Strategic Command (USSTRATCOM) and reached full operational
    capability early in 2006. The JFCC-IMD is manned by Army, Navy, Air
    Force, Marine Corps, and civilian personnel. This joint-manning
    arrangement and our strong partnership with our collocated MDA team
    enable us to execute the integrated missile defense mission by
    leveraging the existing robust infrastructure.
        USSTRATCOM, through the JFCC-IMD, continues to aggressively execute
    its mission to globally plan, integrate, and coordinate missile defense
    operations. Through stressing operational scenarios, integrated missile
    defense has experienced robust growth and maturity and has improved its
    ability to defend this nation. Although, there is much work yet to be
    done, JFCC-IMD continues to lead the Department's transformation toward
    more robust integrated missile defense capabilities. The soldiers,
    sailors, airmen, marines, and civilians of this joint warfighting
    organization execute our mission to plan, integrate, and coordinate
    global missile defense operations and support by operationalizing new
    capabilities from MDA, developing global missile defense plans in
    collaboration with the geographical combatant commanders, and
    conducting cross-geographical combatant commander exercises to
    eliminate seams and gaps to maintain a strong defense against changing
    threats. Execution of the essential mission includes providing warning
    of missile attack to other combatant commanders and providing
    assessment of missile attack. In all, JFCC-IMD continues to build
    operational competence of the integrated missile defense capability and
    warfighter confidence in executing our mission.
    Ballistic Missile Defense System Progress
        This past year has been a year of operational achievement for
    integrated missile defense as we successfully placed the BMDS on alert
    in response to a credible ballistic missile threat from North Korea.
    This limited defense capability marked the beginning of global missile
    defense as warfighters from three combatant commands and allies
    integrated respective assets and personnel toward a single mission
    against a common threat. The scale of this integration is
    unprecedented--non-missile defense assets were integrated with legacy
    and state-of-the-art technologies to provide a shield to protect our
    homeland. Additionally, we achieved unparalleled integration of the
    Department's intelligence capabilities to enable timely and responsive
    indications and warning to support missile defense readiness. We expect
    the warfighting capability provided by such integration of assets,
    platforms, doctrine, and personnel to continue to grow in coming years.
        The North Korean incident last summer also underscored the growing
    maturity of the cross-JFCC integration within USSTRATCOM in executing
    its global mission. JFCC-IMD collaborated closely with the JFCCs for
    Intelligence, Surveillance, and Reconnaissance (JFCC-ISR) and Space
    (JFCC-Space) to integrate the intelligence, surveillance,
    reconnaissance, and space assets for the missile defense missions. This
    effort afforded the use of intelligence, surveillance, reconnaissance,
    and space assets that previously had not been included in the missile
    defense mission. Similarly, JFCC-IMD collaborated closely with JTF-
    Global Network Operations to maximize availability of a robust
    communication network to link the decisionmakers in Washington with
    commanders across the globe. We have also integrated our planning
    efforts with the JFCC for Global Strike and Integration (JFCC-GSI) to
    ensure we integrated both offensive and defensive capabilities into
    potential courses of action. Our approach today for a missile defense
    contingency is designed to examine and integrate a broader array of
    capabilities into our planning and execution. In short, JFCCs are
    maturing in a deliberate and coordinated pace to extend the New Triad
    in its global mission.
        JFCC-IMD's readiness demonstrated during last summer's incident is
    a testimony to the robust warfighter exercise and test program. During
    the past year, we planned and conducted three major combatant command-
    level exercises involving U.S. Pacific Command, U.S. Northern Command
    and U.S. Strategic Command. These exercises enabled combatant
    commanders to exercise concepts of operations and tactics, techniques,
    and procedures, and improve our planning and execution of missile
    defense operations. These activities enhance warfighter competence in
    prosecuting a global missile defense capability. JFCC-IMD's global
    missile defense exercise program also extended to our coalition
    partners. These international exercises further bolstered our allies'
    resolve in conducting combined missile defense operations and extending
    partnership into co-development of future capabilities.
    Warfighter Contributions to System Development
        Warfighters participate in key BMDS tests to build confidence in
    its capabilities. JFCC-IMD led warfighter participation in the first
    distributed ground tests on the operational BMDS, geographically
    distributed from Colorado to Alaska, and Washington to Japan. This test
    demonstrated the growing sophistication and complexity of BMDS
    assessments that are increasingly operationally relevant. Furthermore,
    warfighters collaborated with MDA to successfully conduct key flight
    tests to bolster our Nation's confidence in the effectiveness of the
    integrated missile defense capabilities.
        Within a 90-day period, we successfully intercepted ballistic
    missiles at low and high altitudes; in midcourse and terminal phases;
    and, in endo- and exo-atmospheric environments with the Patriot
    Advanced Capability-3 (PAC-3), the AEGIS Standard Missile-3, the
    Terminal High Altitude Area Defense (THAAD), and our long-range Ground-
    Based Interceptor. Conducting these system-level flight and ground
    tests required the use of operational assets, the very assets that
    would be used to defend this nation against a possible North Korea
    missile attack. JFCC-IMD worked closely with the Combatant Commanders
    and MDA to coordinate the availability of these assets to ensure
    sustained operational readiness during the conduct of the system-level
    tests.
        The JFCC-IMD was able to balance the requirements of both
    operations and tests, but this period of robust achievements
    underscored the warfighter's requirement to expedite development and
    deployment of a concurrent testing, training, and operations
    capability. Concurrent test, training and operations will permit
    developers and operators to maintain full operational mode of the BMDS
    while simultaneously developing, testing, or training on the system.
    The need for the concurrent test, training and operations capability is
    especially pronounced for the one-of-a-kind assets that are shared
    between the warfighter, developer, and trainer communities.
        Absent a mature concurrent test, training and operations
    capability, JFCC-IMD aggressively conducts an asset management process
    to ensure the highest level of operational readiness during conduct of
    materiel development and tests. Supported by an indications and warning
    system, the asset management process has been the key enabler to
    operationalize new capabilities, perform operationally relevant tests,
    and conduct system-wide upgrades. During the past year, the asset
    management process facilitated warfighters and materiel developers in
    optimizing the use of the deployed elements while fielding additional
    assets. In addition, warfighter participation in the flight and ground
    testing increased our confidence in the system's performance.
    Increasing the Capability of the System
        JFCC-IMD, in partnership with MDA and the Services, has integrated
    additional missile defense sensors and shooters to enhance theater and
    strategic mission capabilities. We have increased the robustness of our
    sensor capability by deploying a mobile sensor in Japan, increasing the
    number of AEGIS ships enabled with the long range search and tracking
    capability, and are deploying a midcourse discrimination sensor in the
    waters of Alaska. We have continued deployment of the Navy's Ballistic
    Missile Defense AEGIS Standard Missile-3, Patriot Advanced Capability-3
    missiles, and increased the number of Ground-Based Interceptors.
    Additionally, in my role as the JFCC-IMD Commander, I have been in
    discussion with European Command to build a stronger partnership with
    our Allies and to host a midcourse radar and interceptor site to
    counter the Iranian threat.
        The Command, Control, Battle Management, and Communications System
    is an essential evolutionary component of the BMDS that greatly
    enhances both planning and execution capabilities. The command and
    control system contributes to all phases of integrated missile defense
    from optimizing planning to synchronizing the automated execution of
    the BMDS. During the past year, upgrades to the command and control
    system have extended situational awareness, planning, and sensor
    management capability to key components of U.S. Strategic Command, U.S.
    Northern Command, and U.S. Pacific Command. Additionally, critical
    command and control system situational awareness nodes are utilized by
    the White House, National Military Command Center, and Secretary of
    Defense Executive Support Center.
        As we move forward in the next year, much work remains to be done.
    We will continue to integrate and conduct cross-geographic combatant
    commander planning and exercises, deploy new capabilities, and increase
    allies' involvement in global missile defense. We will continue to
    advocate for system improvements that close capability gaps and improve
    system performance. Fielding more capable command and control systems,
    sensors, and kill vehicles, such as the Multiple Kill Vehicle, will
    provide the warfighter with a system capable of addressing a broad
    range of threats. Our continuing goal is to develop a seamless missile
    defense system, that integrates all available capabilities, to deter
    and dissuade the proliferation of missile threats, and if necessary,
    defeat them to protect our Nation, deployed forces, friends, and
    allies.

       AIR AND MISSILE DEFENSE--AN OVERVIEW OF THE FISCAL YEAR 2008 ARMY
                               BUDGET SUBMISSION

        In addition to deploying the BMDS, MDA, the Services, and the
    combatant commanders continue to focus on improving theater air and
    missile defense capabilities. Both the GMD and Theater Air and Missile
    Defense Systems are vital for the protection of our homeland, deployed
    forces, friends, and allies. Air and missile defense is a key component
    in support of the Army's core competency of providing relevant and
    ready land power to combatant commanders.
        As you are aware, real world events over the past year have
    increased the relevance, urgency, and importance of theater air and
    missile defense as well as cruise missile defense. Medium and short-
    range ballistic missile and cruise missile threats continue to grow,
    especially in light of increased proliferation of missile defense
    technology. These threats, combined with Iran's and North Korea's
    increased interest in nuclear capabilities, are of particular concern.
        As highlighted in the 2006 Quadrennial Defense Review, a number of
    potentially hostile states possess or seek weapons of mass destruction.
    This is especially troubling when considered along with ballistic and
    cruise missile proliferation. For these states, weapons of mass
    destruction--particularly nuclear weapons--provide the means to assert
    regional domination and intimidate others. As such, the Quadrennial
    Defense Review specifically highlighted the need for integrated
    defenses against short-, intermediate-, and intercontinental-range
    ballistic and cruise missile systems.
        The House Armed Services Committee Defense Review Report, released
    in December 2006, concluded that the U.S. force structure must expand
    and U.S. capabilities must improve to reduce the risk to the security
    of the American people to an acceptable level and noted that a robust
    BMDS is critical to defeat strategic threats to the United States and
    its allies. The report also noted that Operation Enduring Freedom and
    Operation Iraqi Freedom are consuming key missile defense capabilities,
    leaving other worldwide commitments under-resourced.
        In light of these reports and their findings, the Army, in concert
    with the Department of Defense and MDA, is taking the necessary steps
    to ensure that the U.S. homeland, allies and deployed forces are
    provided the necessary protection from these threats. With that as a
    background, I would now like to focus on the Army's fiscal year 2008
    budget submission for air and missile defense systems. The President's
    budget, presented to Congress on February 5, includes approximately
    $1.75 billion with which the Army proposes to execute current Army air
    and missile defense responsibilities and focus on future development
    and enhancements of both terminal phase and short-range air and missile
    defense systems. In short, the Army is continuing major efforts to
    improve the ability to provide warning, acquire, track, intercept, and
    destroy theater air and missile threats.
        The Army, as part of the joint team, continues its transformation
    of air and missile defense forces to meet the increasingly
    sophisticated and asymmetric threat environment encountered by the
    joint and allied warfighter. The air and missile defense force will
    meet this threat by adhering to the following imperatives:

             One seamless integrated force
             Advanced engagement concepts
             Defense in depth
             360-degree defense
             Early and continuous engagements
             Assure friendly use of airspace
             Support information dominance
    Integrated Air and Missile Defense
        In order to fulfill these imperatives, the Army is transforming its
    air defense force from its current separate systems architecture to a
    component-based, network-centric, Integrated Air and Missile Defense
    system of systems. The Integrated Air and Missile Defense Program
    focuses on systems integration, common battle command and control,
    joint enabling networking, and logistics and training to ensure
    operational requirements, such as force lethality, survivability,
    transportability and maneuverability, are achieved. Benefits of
    developing and fielding such a capability include:

             Expanded defended areas against the full-spectrum of
            threats
             Integrated defense design which eliminates single
            nodes of failure
             Flexibility in choice of interceptors
             Ability to battle manage weapons, sensors, and
            inventories
             Seamless training adjustments for battle managers
            across the Integrated Air and Missile Defense Force
             Closing current capability gaps

        The Integrated Air and Missile Defense Program employs an
    evolutionary acquisition strategy that leads to the objective net-
    centric system of systems plug-and-fight capability. The approach calls
    for a restructuring of current Army air and missile defense systems
    into components of sensors, weapons, and battle management command,
    control, communications, computers, and intelligence with a standard
    set of interfaces among the components using a standardized
    communications network. This modularization of missile defense
    capabilities will allow Joint Forces Commanders to scale and tailor
    assets and forces based upon the specific operating environment in
    which they are employed.
        Technology insertions to the Integrated Air and Missile Defense
    will continue throughout each increment as high-payoff technologies
    mature and are ready for integration. Incremental development of the
    program allows the Army to more quickly field new and improved
    capabilities to the warfighter. The proposed fiscal year 2008
    President's budget supports the evolution of an Integrated Air and
    Missile Defense capability.
    Air and Missile Defense Organizational Structure
        As part of air defense transformation, the Army has created
    composite air and missile defense battalions. These battalions address
    capability gaps, permitting us to defeat cruise missiles and unmanned
    aerial vehicles while maintaining our ability to defend critical assets
    from the ballistic missile threat. Composite air and missile defense
    battalions will capitalize on the synergies of two previously separate
    disciplines: short-range air defense and high-to-medium altitude air
    defense. Additionally, the Army no longer provides an organic air
    defense artillery battalion to its Divisions. Instead, divisional air
    defense artillery battalions are pooled at the theater-level to provide
    air and missile defense protection based on situation and mission
    requirement. The pool of Army air and missile defense resources will
    address operational requirements in a tailored and timely manner. This
    pooling concept supports the Army's effort to move to modular designs
    that allow force tailoring of units better sized to meet the combatant
    commanders' needs and homeland security and defense requirements.
        Within the context just provided, allow me to briefly discuss the
    three main component areas of the Army's air and missile defense
    construct: Terminal Phase Ballistic Missile Defense, Cruise Missile
    Defense, and Force Protection.

                   TERMINAL PHASE BALLISTIC MISSILE DEFENSES

        The Patriot/Medium Extended Air Defense System (MEADS) capability
    is designed to counter theater ballistic missile threats in their
    terminal phase in addition to cruise missiles and other air-breathing
    threats. Combining these systems with the Terminal High Attitude Area
    Defense System capability being developed by MDA with a planned
    fielding in fiscal year 2009, brings an unprecedented level of
    protection against missile attacks to deployed U.S. forces, friends,
    and allies well into the future.
    Patriot/PAC 3 Overview
        Chairman, since the combat debut of the Patriot Air and Missile
    Defense System during Operation Desert Storm, the Army has continued to
    implement a series of improvements to address the lessons learned.
    During Operation Iraqi Freedom, we saw the debut of the improved
    Patriot Configuration-3 system, including the effective use of the
    Guidance Enhanced Missile and the Patriot Advanced Capability-3 (PAC-3)
    missile. PAC-3 is the latest evolution of the phased materiel
    improvement program to Patriot. Combining developmental testing and
    operational data, this program enables the development and deployment
    of a new high-velocity, hit-to-kill, surface-to-air missile with the
    range, accuracy, and lethality necessary to effectively intercept and
    destroy more sophisticated ballistic missile threats. Today's Patriot
    force is a mixture of PAC-2 and PAC-3 configured units. To maximize the
    full advantage of the PAC-3 capabilities, the Chief of Staff of the
    Army has directed the Army to pure-fleet the entire Patriot force to
    the PAC-3 configuration. In response to combatant commanders'
    requirements, the Vice Chief of Staff of the Army directed the creation
    of two additional Patriot battalions to help relieve the stress on the
    Patriot force and increase the Army's strategic responsiveness in the
    area of terminal ballistic missile defense. These directives underscore
    the importance of Patriot to the Nation's overall National Military
    Strategy and are necessary to maximize the capabilities for protecting
    the security interests of both the United States and our allies.
        While Patriot saved many lives defending against Iraqi ballistic
    missile attacks during Operation Iraqi Freedom, there were some
    operational deficiencies. The Army has undertaken steps to correct them
    and address lessons learned. The Army has pursued two thrusts--
    identification and execution of a $41.6 million program for nine
    specific Operation Iraqi Freedom fixes and continued aggressive
    participation in joint interoperability improvements in situational
    awareness. The development, testing, and materiel release for the nine
    enhancements is on schedule to be completed by the end of this fiscal
    year. Several enhancements have already completed fielding. The
    remaining enhancements are either currently being fielded or are
    planned to start this spring. Based on the current fielding schedule,
    all remaining Operation Iraqi Freedom fixes will complete fielding to
    the units by fiscal year 2009.
        The Patriot system remains the Army's mainstay Terminal Air and
    Missile Defense System and our Nation's only deployed land-based short-
    to-medium range BMDS capability. The current PATRIOT force must be
    sustained and recapitalized until MEADS is completely fielded. Fielding
    of MEADS is scheduled to begin in 2015 and be completed by 2028.
    Combined Patriot/MEADS Approach
        With the approval of the Defense Acquisition Executive, the Army
    embarked on a path that merged the Patriot and MEADS programs,
    establishing the Patriot/MEADS Combined Aggregate Program with the
    objective of achieving the MEADS capability through incremental
    fielding of MEADS major end items into Patriot. Patriot/MEADS Combined
    Aggregate Program is an important capability that will operate within
    the BMDS. It is, in fact, a top Army priority system for defense
    against short- and medium-range tactical ballistic missiles and air
    breathing threats. The Patriot/MEADS Combined Aggregate Program will be
    an integral part of the Integrated Air and Missile Defense System of
    Systems and capable of operating within a Joint, interagency,
    intergovernmental, and multinational interdependent operational
    environment. It will provide wide-area protection at strategic,
    operational, and tactical levels.
        The Patriot/MEADS Combined Aggregate Program will also provide
    battle management command and control in accordance with the IAMD
    provided common battle command system, introduce lightweight deployable
    launchers, upgrade the PAC-3 missile, and eventually provide the full
    MEADS capability to the entire force. By establishing the Patriot/MEADS
    Combined Aggregate Program, the Joint integrated air and missile
    defense architecture will become more robust in key ways. First, MEADS
    enhancements are integrated into the existing system. Second, as
    lessons are learned from the present missile defense capability, they
    will be incorporated into the MEADS follow-on system.
        MEADS is a cooperative development program with Germany and Italy
    to field an enhanced ground-mobile air and missile defense capability.
    The MEADS program, which supports the President's goal for
    international cooperation in missile defense, will enable the joint
    integrated air and missile defense community to operate more
    effectively on future battlefields. MEADS will provide theater level
    defense of critical assets and continuous protection of a rapidly
    advancing maneuver force as part of the Joint integrated air and
    missile defense architecture. Major MEADS enhancements include 360-
    degree sensor coverage and a strategically deployable and tactically
    mobile air and missile defense system that can be deployed and
    controlled as part of the integrated air and missile defense
    architecture. The PAC-3 Missile Segment Enhancement is currently under
    development and will be integrated into the MEADS program. The Missile
    Segment Enhancement Missile will provide a more agile and lethal
    interceptor that increases the engagement envelope. We are confident
    that this path will provide our service members, allies, friends, and
    our Nation with the most capable air and missile defense system
    possible.
    Terminal High Attitude Area Defense System Overview (THAAD)
        The Department of Defense is committed to fielding an advanced
    capability to defend against tactical ballistic missiles as soon as
    possible. THAAD is designed to provide critical defense against short
    and medium range ballistic missiles. As a result, MDA is funding and
    manufacturing four THAAD fire units for the Army in an accelerated
    fielding that will begin in 2009. This investment represents an initial
    THAAD capability for the warfighter and the next major step towards a
    comprehensive, layered theater ballistic missile defense. Follow-on
    THAAD upgrades are planned in future budgets to meet an ever increasing
    and evolving threat.

                             CRUISE MISSILE DEFENSE

        In the world today, there exists a real and growing threat from
    land attack cruise missiles. Cruise missiles are inherently very
    difficult targets to detect, engage, and destroy because of their small
    size, low detection signature, and low altitude flight characteristics.
    When armed with a weapon of mass destruction warhead, the effects from
    a cruise missile could be catastrophic. The Army's Cruise Missile
    Defense Program is an integral piece of the Joint cruise missile
    defense architecture. Critical Army components of the Joint cruise
    missile defense architecture are provided by the Joint Land Attack
    Cruise Missile Defense Elevated Netted Sensor System, the Surface-
    Launched Advanced Medium Range Air-to-Air Missile, the Patriot Missile
    Segment Enhancement Missile, and an integrated fire control capability
    inherent in the Integrated Air and Missile Defense System of Systems.
    We are also working closely with the Joint community to assure
    development of doctrine that synchronizes our military's full
    capabilities against the cruise missile threat.
        The Joint Land Attack Cruise Missile Defense Elevated Netted Sensor
    System brings a critically needed capability to detect, track, and
    identify cruise missile threats. The system will support engagements
    using the Surface-Launched Advanced Medium-Range Air-to-Air Missile,
    the Navy Standard Missile, and the Patriot/MEADS weapon systems by
    providing precision tracking and 360-degree wide-area and over-the-
    horizon surveillance of land-attack cruise missiles. The Surface-
    Launched Advanced Medium-Range Air-to-Air Missile will provide maneuver
    forces with a critical, beyond line-of-sight engagement capability to
    counter the cruise missile threat, as well as unmanned aerial vehicle
    threats, over an extended battlespace. The Surface-Launched Advanced
    Medium-Range Air-to-Air Missile uses the existing Joint Advanced
    Medium-Range Air-to-Air Missile currently used by the Air Force and the
    Navy, thereby capitalizing on Joint commonality on the battlefield.

                                FORCE PROTECTION

        A significant danger in Operation Iraqi Freedom and Operation
    Enduring Freedom is posed by insurgents employing indirect-fire tactics
    of quick-attack, low-trajectory, urban-terrain-masked rocket,
    artillery, and mortar strikes against U.S. forward operating bases in
    Iraq. To combat this threat, the Army developed Counter-Rocket,
    Artillery, Mortar (CRAM), an integrated solution of capabilities to
    provide warning and intercept of rocket, artillery, and mortar threats.
    CRAM provides a holistic approach to this emerging menace. Horizontal
    integration across the core functions--command and control, shape,
    sense, warn, intercept, respond and protect--is providing an integrated
    modular and scalable capability. This capability provides timely
    warning of mortar attacks, intercept and defeat of incoming rounds, and
    accurate location of insurgent mortar crews, enabling a rapid, lethal
    response. CRAM takes advantage of existing systems and capabilities,
    combining them in a system of systems architecture to support the
    warfighter on today's battlefield. The current CRAM solution is truly
    Joint, in that it uses fielded systems from the Army, Navy and Air
    Force along with a commercial off-the-shelf system. To date, CRAM has
    been supported solely through supplemental appropriations. Recognizing
    the enduring nature of the rocket, artillery, and mortar threat, the
    Army is exploring ways, to include the use of directed energy, to
    enhance this capability across all of the core functions, thereby
    making it even more relevant to the future modular force.

                                   CONCLUSION

        Mr. Chairman, the Army, a fully contributing member of the Joint
    team, is relevant and ready, fighting the war on terrorism, and
    deterring aggression throughout the world, while transforming to meet
    future threats. With its responsibilities for GMD, THAAD, and PAC-3/
    MEADS Combined Aggregate Program, the Army is an integral part of the
    joint team to develop and field an integrated missile defense for our
    Nation, deployed forces, friends, and allies. In my role as the Joint
    Functional Component Commander for Integrated Missile Defense, I will
    continue the development of a Joint BMDS capability to protect our
    Nation, deployed forces, friends, and allies. The Army has stepped up
    to the land-attack cruise missile defense challenge by aggressively
    developing the Joint, integrated, and networked sensor-to-shooter
    architecture necessary to defeat the emerging threat. The fiscal year
    2008 budget proposal continues the transformation of the Army's air,
    space, and missile defense force to support the Army's future force,
    the Joint Integrated Air and Missile Defense System, and our global
    BMDS. Transformation will continue to define the characteristics of the
    emerging air, space, and missile defense force and determine how it can
    best support the future force operating in a Joint, interagency,
    intergovernmental, and multinational environment.
        I appreciate having the opportunity to speak on these important
    matters and look forward to addressing any questions you or the other
    committee members may have.

        Senator Bill Nelson. I notice three ladies standing up in
    the back, I would invite some of the gentlemen to offer their
    seats to the ladies, otherwise, would the ladies come up here
    and sit up here?
        Would the gentleman give the lady a seat? Ma'am, there's a
    seat right in the back. [Laughter.]
        Okay, Dr. McQueary?

      STATEMENT OF DR. CHARLES E. McQUEARY, DIRECTOR, OPERATIONAL
       TEST AND EVALUATION, OFFICE OF THE SECRETARY OF DEFENSE,
                         DEPARTMENT OF DEFENSE

        Dr. McQueary. Chairman Nelson and Senator Sessions, thank
    you very much for the opportunity to be here with the other
    distinguished members of the panel.
        I have four brief points that I'll make that I'll summarize
    in more detail in my prepared remarks. But, the four points
    that I wish to touch upon--I'll briefly give you my view of the
    test accomplishments that MDA has had in this past year.
    Second, I'll give you my current assessment of how we look at
    the Ballistic Missile Defense System (BMDS) and its successes.
    Third, we'll talk about the implementation of the DOT&E
    recommendations, which is one of the points that you had made
    in your letter to me, and the fourth, I'll give you my current
    view as to where we are on being able to fulfill the Block 2006
    assessment requirements that were placed on us in the National
    Defense Authorization Act of 2006.
        First of all, I just will summarize by saying that MDA has
    had a good year in 2006, as well as the beginning of 2007.
    General Obering touched upon a number of things that were
    accomplished during that time period, so there's no point in my
    repeating any of that, and I won't do so.
        I will say that MDA's test program has been a robust
    program, it's been disciplined, and has demonstrated capability
    both in ground tests, as well as in flight tests that the
    system can work in certain scenarios.
        My assessment, the second point I wanted to make is the
    assessment; DOT&E had points of view that were raised in the
    hearings that were held in 2005 and 2006, but what I can tell
    you today is that the, in my view, that BMDS has demonstrated a
    limited capability against a simple foreign threat, and that's
    the important step forward in the development of such a system.
    Coupled with the other successes that MDA has had, I think, as
    well as the integrated ground test, I think BMDS is definitely
    maturing in a satisfactory way, and the picture looks good.
        So, the third point I'd like to make, Mr. Chairman is to
    review the recommendations very briefly. I will not go into
    specifics of what they are, but MDA has been very responsive to
    the inputs we have. We had 26 recommendations that were made in
    2005, and all but four of those have been fully implemented
    based upon our recommendations, and MDA has specific plans in
    place to address the other four.
        In 2006, we had made 15 new recommendations, and of course
    a report just came out early in the year, but MDA has been
    working with us, in order to implement plans and test programs
    that would be responsive to those.
        So, in summary, I am very satisfied with the responsiveness
    of General Obering and his staff in working with us, and being
    responsive to the descriptions of what we believe from an
    independent operational test evaluation standpoint needs to be
    done.
        My only role--the role that DOT&E has for MDA, in
    particular--is to advise what should be done, but I will say
    that General Obering and his staff have been as responsive as
    any other program elements that we deal with in our overall
    responsibilities at DOT&E. So, from my standpoint, being
    relatively new in the job, I found it very satisfying.
        Then the fourth issue is the one on the challenges of being
    able to do the Block 2006 assessment. There were two failures
    back in 2005, and the program had to go through a re-evaluation
    of what the structure should be for testing. I think that has
    been a good test program. However, due to the limited nature of
    actual testing that has been done to date, it will be very
    difficult for DOT&E to provide an analytical, complete
    assessment of what is needed for the Block 2006. We'll have
    much better insight into that as we get farther into the year,
    and see the additional testing that is being done.
        So, in summary, I think that MDA has had a good year, I
    believe the organization has been very responsive to DOT&E's
    requests, and I'm very pleased with what I have seen so far,
    although, as indicated, we do have some recommendations as to
    what can be done to improve the program, we believe, and I look
    forward to your questions, so we can get into and probe this in
    more detail.
        [The prepared statement of Dr. McQueary follows:]

                 Prepared Statement by Dr. Charles E. McQueary

        Mr. Chairman, Senator Sessions, and distinguished members of the
    subcommittee, good afternoon. I am pleased to have this opportunity to
    speak to you about the testing of the Ballistic Missile Defense System
    (BMDS). I will briefly cover four areas.
        First, I will review what I believe are the major Missile Defense
    Agency's test accomplishments during the past year.
        Second, I will give you my current assessment of the capability of
    BMDS.
        Third, I will provide a review of the implementation of DOT&E
    recommendations made to the Missile Defense Agency (MDA).
        Fourth, I will discuss the factors that will limit my ability to
    provide a thorough Block 6 assessment as required by the National
    Defense Authorization Act for Fiscal Year 2006.

                               FIRST: THE RESULTS

        MDA had a good year of testing in 2006.
        For the first time in the Ground-based Midcourse Defense program,
    MDA successfully intercepted a ``simple'' threat-representative target
    with an operational booster carrying an operational kill vehicle. Also,
    for the first time, MDA used data from an operational radar to generate
    the weapon task plan sent to the interceptor by the fire control
    system.
        Aegis Ballistic Missile Defense was two for two in intercepts of
    medium-range separating targets. Using Aegis cruisers, operational
    connectivity, and simulated targets, MDA demonstrated simultaneous
    ballistic missile defense and ship self-defense capabilities in
    preparation for a live flight test in 2007.
        From November 2005 through January 2007, the Terminal High Altitude
    Area Defense was four for four on successful flights of the production
    interceptor. Two of these test flights involved intercept of targets,
    and both of those intercept flight tests were successful hits.
        MDA's ground test program was active, robust, and disciplined,
    demonstrating BMDS capability and interoperability.

                             SECOND: MY ASSESSMENT

        At the 2005 hearing, DOT&E reported that the integrated ground test
    results indicated the test bed had the potential to defend against a
    limited attack, under certain conditions. However, difficulties in the
    flight test program delayed confirmation of that capability.
        During the 2006 hearing, DOT&E reported that the results of the
    ground tests demonstrated that integration, interoperability, tactics,
    doctrine, and procedures, were adequate to increase confidence in these
    aspects of the system. The MDA testing program during 2005 was adequate
    and appropriate to the developmental maturity of the BMDS.
        Today, I can state that the BMDS has demonstrated a limited
    capability against a simple foreign threat. Coupled with the success of
    other element-level testing and MDA's integrated ground tests, the BMDS
    is definitely maturing.
        My assessment is bolstered by the fact that MDA is increasing the
    operational realism of each successive test.

                           THIRD: THE RECOMMENDATIONS

        Mr. Chairman, in your invitation to address the committee, you
    asked me to provide an assessment of MDA's implementation of DOT&E
    recommendations made to the agency. I will do that now.
        There were 26 recommendations in the fiscal year 2005 annual
    report. Only 4 recommendations are still open, and MDA is acting on
    each of them. Two involve ongoing data collection, one involves the
    future test schedule, and one deals with the test planning process.
        There are 15 new recommendations in the fiscal year 2006 annual
    report. Many of these new recommendations involve demonstrations of
    specific capabilities during actual intercept tests. MDA is actively
    considering these recommendations, and has already added several to its
    test schedule.
        I only advise MDA on its developmental test program. I am satisfied
    with MDA's response to the recommendations in our annual reports. I am
    pleased that General Obering and his staff recognize the value of our
    suggestions and recommendations. A more capable BMDS is our mutual
    goal.

                             FOURTH: THE CHALLENGES

        Despite these successes, BMDS is still maturing as a system which
    makes it difficult for me to assess Block 06 capability as required by
    the National Defense Authorization Act for Fiscal Year 2006.
        First, to be confident in my assessment of effectiveness I need
    validated models and simulations for the BMDS. They don't exist today
    because MDA doesn't have enough flight test data to anchor them. MDA,
    the multi-service BMDS Operational Test Agency team, and DOT&E
    personnel are working together to solve this problem. However, there
    may be insufficient time to fix this problem before we finalize the
    Block 06 report.
        While these models and simulations will be essential to proving the
    operational capability of BMDS, we cannot use models and simulations as
    substitutes for live testing. Both General Obering and I agree on this
    important issue. MDA's testing must be sufficient to have high
    confidence that the models and simulations are valid representations of
    the actual performance and capability of the BMDS.
        Second, I will have difficulty assessing suitability. BMDS has not
    operated long enough to gather statistically significant data on its
    reliability, availability, and maintainability, although the tests to
    date are very encouraging. MDA and the warfighters are collecting the
    data, but the amount may be insufficient to reach any confident
    conclusions about the suitability of BMDS.
        In conclusion, MDA experienced a good year with its ground and
    flight test programs. Individual element successes indicate their
    capabilities. Integrated ground testing of the BMDS is demonstrating
    that the warfighters understand and can operate the system confidently
    and effectively. There is still a long way to go, but MDA's disciplined
    and principled approach to flight and ground tests is starting to pay
    real dividends.
        This concludes my remarks and I welcome your questions.

        Senator Bill Nelson. Mr. Francis?

     STATEMENT OF PAUL FRANCIS, DIRECTOR, ACQUISITION AND SOURCING
       MANAGEMENT, UNITED STATES GOVERNMENT ACCOUNTABILITY OFFICE

        Mr. Francis. Thank you, Mr. Chairman, good afternoon.
        Good afternoon, Mr. Sessions, and Mr. Inhofe.
        I'd like to start out today by saying that what I bring to
    the discussion is not superior technical knowledge of missile
    defense, but rather a broad knowledge base that includes many
    weapons systems, to include missile defense. I also look at
    large systems like the Army's Future Combat Systems, and Navy
    shipbuilding, and I have a fair amount of history with
    acquisition policy and best practices.
        I want to recognize at the outset the accomplishments of
    the missile defense program, and the dedication and hard work
    that General Obering and his staff have put in to deliver this
    system.
        I'm going to focus on the rather un-glamorous topic of
    value for money. By statute, we're required to prepare annual
    assessments of MDA's progress in the areas of cost, schedule
    and performance. Our March 2007 report is our fourth such
    assessment.
        Yet, each year, while we can report on what MDA
    accomplished and what it costs, we can't reconcile this with
    the budget that you approved. I can tell you that costs have
    gone up for Blocks 2004 and 2006, and that the scope of work
    has been reduced for each. However, I can't tell you the cost
    of the work that was deferred, or to what extent you may have
    to provide funds again for something that has already been
    funded.
        Here's why--MDA reduces a block's scope when work is
    deferred to cover cost increases. When work is deferred from
    one block, the cost of that work moves to the next block.
    However, each block is estimated anew, so that the baseline is
    reset to zero, and prior work is grandfathered into the new
    block. When work travels from one block to another, the
    connection between the actual work done and the amount of work
    used to justify budget requests is weakened.
        Normally, individual programs, like the elements, would
    capture the cost consequences of deferred work. However, in
    MDA, the elements do not have total cost estimates. Thus, they
    do not reflect the cost consequences of deferrals, because
    totals are not calculated. Total costs also enable one to
    calculate unit costs. These calculations are not possible on
    the MDA elements, nor can one readily track the actual cost of
    an item, like a missile, and compare it with the estimated
    budget costs for that item.
        The reason for this is that MDA has the flexibility to
    change scope and move funding around to provide what it
    believes is the most capability. The advantages of management
    systems, is that you can make decisions that cross program
    lines, giving you more options and more agility to make
    tradeoffs. MDA has this, and more. The director is vested with
    the collective responsibilities of the program manager, the
    service acquisition executive, and the milestone decision
    authority.
        MDA has the latitude to change scope and goals after funds
    have been appropriated, without having to seek DOD or
    congressional approval. Because missile defense has not
    formally entered the system development and demonstration phase
    of acquisition, it is not subject to statutes like Nunn-
    McCurdy, that govern baselines, cost reporting and independent
    cost estimates.
        Also, MDA funds its entire budget with research and
    development (R&D) monies. MDA can thus move money with
    comparative ease between activities, such as technology, system
    development, production and support. MDA can also fund the
    production of operational assets incrementally, that is, to
    spread their costs over several years, unlike the full funding
    of assets that Congress requires of other programs.
        These flexibilities were consciously given to MDA, and have
    helped facilitate tradeoffs and to field the capability
    quickly. We do not question the need for, or the efficacy of,
    these decisions. However, the consequence is that it is hard to
    reconcile value with money. This is important for a couple of
    reasons.
        First, missile defense is the largest weapon system in the
    budget. The program has funded between $8 billion and $10
    billion each year, and for the foreseeable future, we're going
    to fund at this level.
        Second, each of the military Services is also planning
    large investments over the next 5 to 10 years, and these are
    going to increase the competition for funds. These include the
    Air Force purchases of F-22 and Joint Strike Fighter, the
    Navy's plan to double its shipbuilding budget over the next few
    years, and the Army's looking for additional funds for its
    Future Combat Systems (FCS). We have to know what kind of
    return we're getting on these investments, because overruns or
    scope reductions represent opportunity costs for other
    activities that could be undertaken by DOD.
        We've made several recommendations to improve the
    accountability and transparency of missile defense. We believe
    changes need to be made to the block construct, and that the
    individual elements should comply with the statutes that ensure
    accountability of other programs. We also believe MDA should
    use procurement funds when it's buying operational assets.
        MDA is concerned that an over-emphasis on elements will
    weaken the integration of the missile defense system of
    systems. We believe changes can be made in such a way that
    preserve the director's ability to make decisions across
    program lines, without creating unreasonable delays in
    decisionmaking.
        Mr. Chairman, this concludes my statement, I'll be happy to
    answer questions.
        [The prepared statement of Mr. Francis follows:]

                       Prepared Statement by Paul Francis

        Mr. Chairman and members of the subcommittee: I am pleased to be
    here today to discuss the Missile Defense Agency's (MDA) strategy for
    acquiring a Ballistic Missile Defense System (BMDS) and its progress in
    developing and fielding Block 2006--the second iteration of BMDS.
        MDA's mission is to develop and field an integrated, layered BMDS
    capable of defending the United States, its deployed forces, allies,
    and friends against enemy ballistic missiles launched from all ranges
    and during all phases of the missiles' flight. To carry out its
    mission, MDA is fielding missile defense capabilities in 2-year
    increments known as blocks. The first block--Block 2004--fielded a
    limited initial capability that included early versions of Ground-Based
    Midcourse Defense (GMD); Aegis Ballistic Missile Defense (BMD); Patriot
    Advanced Capability-3 (PAC-3); and Command, Control, Battle Management,
    and Communications (C2BMC). Each of these components is an element of
    the integrated BMDS. During calendar years 2006 and 2007, MDA is
    focusing Block 2006 to enhance and field four BMDS elements--GMD, Aegis
    BMD, Sensors, and C2BMC. Block 2006 is not only expected to field
    additional assets, but it also continues the evolution of Block 2004 by
    providing improved GMD interceptors, enhanced Aegis BMD missiles,
    upgraded Aegis BMD ships, a Forward-Based X-Band Transportable radar,
    and enhancements to the C2BMC software.
        The National Defense Authorization Acts for Fiscal Years 2002 and
    2005 mandate that we prepare annual assessments of MDA's ongoing cost,
    schedule, testing, and performance progress. We issued our most recent
    report on March 15, 2007.\1\ My statement today will focus on the
    issues covered in that report, specifically:
    ---------------------------------------------------------------------------
        \1\ GAO, Defense Acquisitions: Missile Defense Acquisition Strategy
    Generates Results but Delivers Less at a Higher Cost, GAO-07-387
    (Washington, DC: Mar. 15, 2007).

             MDA's progress toward developing the Block 2006
            configuration of the BMDS,
             the flexibility granted to MDA and its effect on
            oversight and accountability, and
             the status of MDA's efforts to improve its quality
            processes.

                                    SUMMARY

        MDA continues to make progress on missile defense, but costs have
    grown and less work is being completed than planned. The fielding of
    additional assets and the first end-to-end test of GMD were notable
    accomplishments in fiscal year 2006, as was being able to put BMDS on
    alert status. Yet, MDA will not meet its original Block 2006 cost,
    fielding, or performance goals. MDA will field fewer assets than
    planned, which will cause a commensurate decrease in performance.
    Although scope has been reduced, costs are expected to increase by
    about $1 billion. There is no baseline against which to measure cost.
    For several reasons, we cannot be precise about the actual cost of
    Block 2006. MDA defers work from block to block and counts the cost of
    deferred work as a cost of the block in which the work is performed
    even though that work benefits the original block. For example, work
    deferred from Block 2004 is counted as a cost of Block 2006. Element
    program offices report costs inconsistently, with most underreporting
    costs. The cost of Block 2006 may change further because MDA may defer
    other work from Block 2006 until Block 2008 to cover $478 million in
    fiscal year 2006 budget overruns experienced by element prime
    contractors. We could not assess whether MDA is likely to achieve its
    revised performance goal because too few tests have been completed to
    have confidence in the models and simulations used to predict
    performance. Overall, the block approach has had advantages for
    fielding capabilities incrementally, but it has not proven to be a good
    construct for reconciling actual cost and performance with the
    justifications that MDA submits to support its budget request.
        Because the BMDS program has not formally entered system
    development and demonstration, application of laws that are designed to
    facilitate oversight and accountability of Department of Defense (DOD)
    acquisition programs has effectively been deferred. This gives MDA
    unique latitude to manage the BMDS. Specifically, the BMDS cost,
    schedule, and performance baseline does not have to be approved by
    anyone outside MDA. MDA is not yet required to obtain independent
    assessments of each configuration's cost or test results. Unlike other
    programs, MDA is permitted to use research and development funds to
    incrementally fund all activities, including the purchase and support
    of operational assets. MDA keeps others informed, but it does not need
    their approval. Collectively, this flexibility enables MDA to be more
    agile in its decisionmaking. By the same token, MDA can revise its own
    baseline to field fewer assets than planned, defer work to a future
    block, and increase planned cost. Over time, it becomes difficult to
    reconcile cost and outcomes against original goals and to determine the
    value of the work accomplished. Ultimately, Congress may know that it
    is getting less than expected for its investment, but it will not
    necessarily know the cost of what it did receive or whether it is being
    asked to again appropriate funds for work that had been scheduled in a
    prior block but could not be completed because its funding was diverted
    to pay for other activities. The foregoing does not mean that MDA has
    acted inconsistently with the authorities it has been granted. Rather,
    MDA has the sanctioned flexibility to manage exactly as it has. It
    could be argued that without this flexibility, the initial capability
    fielded last year and put on alert would not have been possible. Yet,
    the question remains as to whether this degree of flexibility should be
    retained for a program that is planning to spend on the order of $10
    billion a year for the foreseeable future.
        MDA auditors report that quality deficiencies are declining and on-
    time deliveries are improving as corrective measures are implemented.
    For example, MDA quality audits show that one key supplier has
    decreased open quality issues by 64 percent, reduced test failures by
    43 percent, and increased on-time deliveries by 9 percent. The
    mechanisms being used to improve quality assurance processes include
    the development of a teaming approach to restore reliability in key
    suppliers, conducting regular quality audits, adjusting award fee plans
    to encourage contractors to maintain a good quality assurance program
    and implement industry best practices, and continuing to incorporate
    key quality provisions into the agency's prime contracts.
        In our March 2007 report, we recommended that MDA establish firm
    baselines for those elements considered far enough along to be in
    system development and demonstration, and report against those
    baselines; propose an approach for those same elements that provides
    information consistent with the acquisition laws that govern baselines
    and unit cost reporting, independent cost estimates, and operational
    test and evaluation; include in blocks only those elements that will
    field capabilities during the block period and develop a firm block
    baseline that includes the unit cost of its assets; request and use
    procurement funds, rather than research, development, test, and
    evaluation funds, to acquire fielded assets; and conduct an independent
    evaluation of the Airborne Laser (ABL) and Kinetic Energy Interceptor
    (KEI) elements prior to making a decision on the future of the
    programs.
        DOD partially concurred with the report's first three
    recommendations, but did not agree to use procurement funds to acquire
    fielded assets or to conduct an independent evaluation of the ABL and
    KEI elements. In partially agreeing, DOD recognized the need to provide
    greater program transparency and committed to providing information
    consistent with acquisition laws that govern baselines and unit cost
    reporting. However, DOD objected to the element-centric approach
    recommended, believing that this would detract from managing the BMDS
    as a single, integrated system. DOD also stated that reporting at the
    BMDS-level in accordance with our third recommendation would appear to
    be inconsistent with reporting at the element level. We continue to
    believe that all recommended changes are needed to provide a better
    balance between MDA's flexibility and BMDS program transparency.
    Because DOD awards contracts and requests funding by individual
    elements that compose the BMDS, we believe that the element approach is
    the best way to achieve increased program transparency. However, a
    BMDS-level baseline derived from the capabilities that individual
    elements yield is needed to describe and manage a BMDS-wide capability.
    We also believe that the use of procurement funds contributes to
    program transparency by making clear at the outset the size of the
    investment being requested in fielded assets. Finally, we continue to
    believe that an independent assessment of the ABL and KEI capabilities
    can provide a transparent basis for making decisions on the future of
    the programs, but we did revise the recommendation to specify that the
    assessment should follow key demonstrations in 2009.

                                   BACKGROUND

        Missile defense is important because at least 25 countries now
    possess or are acquiring sophisticated missile technology that could be
    used to attack the United States, deployed troops, friends, and allies.
    MDA's mission is to develop and field an integrated, layered BMDS
    capable of defending against enemy ballistic missiles launched from all
    ranges and during all phases of the missiles' flight. DOD has spent and
    continues to spend large sums of money to defend against this threat.
    Since the mid-1980s, about $107 billion has been spent, and over the
    next 5 years, another $49 billion is expected to be invested. While the
    initial set of BMDS assets was fielded during 2004-2005, much of the
    technical and engineering foundation was laid by this prior investment.
    DOD also expects to continue investing in missile defense for many more
    years as the system evolves into one that can engage an enemy ballistic
    missile launched from any range during any phase of the missile's
    flight.
        To enable MDA to field and enhance a missile defense system
    quickly, the Secretary of Defense, in 2002, directed a new acquisition
    strategy. The Secretary's strategy included removing the BMDS program
    from DOD's traditional acquisition process until a mature capability
    was ready to be handed over to a military service for production and
    operation. Therefore, development of the BMDS program is not segmented
    into concept refinement, technology development, and system development
    and demonstration phases, as other major defense acquisition programs
    are. Instead, MDA initiates one development phase that incorporates all
    acquisition activities and that is known simply as research and
    development. MDA also has approval to use research and development
    funds, rather than procurement funds, to acquire assets that could be
    made available for operational use.
        To carry out its mission, MDA is fielding missile defense
    capabilities in 2-year increments known as blocks. The first block--
    Block 2004--fielded a limited initial capability that included early
    versions of GMD, Aegis BMD, PAC-3, and C2BMC. This was the capability
    that was put on alert status in 2006. MDA formally began a second BMDS
    block on January 1, 2006, that will continue through December 31, 2007.
    This block is expected to provide protection against attacks from North
    Korea and the Middle East. During the 2-year block timeframe, MDA is
    focusing its program of work on the enhancement and fielding of
    additional quantities of the GMD, Aegis BMD, and C2BMC elements, as
    well as fielding a Forward-Based X-Band radar that is part of the
    Sensors element. When MDA defined the block in March 2005, shortly
    after submitting its fiscal year 2006 budget request to Congress, it
    also included three other elements--ABL, Space Tracking and
    Surveillance System (STSS), and Terminal High Altitude Area Defense
    (THAAD)--that are primarily developmental in nature. According to MDA,
    these elements were included in the block even though they were not
    expected to be operational until future blocks because the elements
    offered some emergency capability during the block timeframe. In March
    2006, MDA removed THAAD from Block 2006. According to MDA, this action
    better aligned resources and fielding plans. The development of two
    other elements--Multiple Kill Vehicle (MKV) and KEI--also continued in
    fiscal year 2006, but these elements were not considered part of Block
    2006 because, according to MDA officials, the elements provide no
    capability--emergency or operational--during the block.
        The bulk of the funding that MDA requests for the BMDS each fiscal
    year is for the development, fielding, and sustainment of BMDS
    elements. For example, in fiscal year 2006, funding for the nine BMDS
    elements collectively accounted for 72 percent of MDA's research and
    development budget. MDA requests funds for each of these elements, with
    the exception of C2BMC and THAAD, under separate budget line items. In
    addition, MDA issues separate contracts for each of the nine elements.
        Prior to beginning each new block, MDA establishes and submits
    block goals to Congress. These goals present the business case for the
    new block. MDA presented its Block 2006 goals to Congress in March
    2005, shortly after submitting its fiscal year 2006 budget. At that
    time, MDA told Congress that the agency expected to field the following
    assets: up to 15 GMD interceptors, an interim upgrade of the Thule
    Early Warning Radar, a Forward-Based X-Band radar, 19 Aegis BMD
    missiles, 1 new Aegis cruiser for the missile defense mission, 4 new
    Aegis destroyers capable of providing long-range surveillance and
    tracking, and 8 Aegis destroyers upgraded for the engagement mission.
    MDA's cost goal for the development of the six elements that compose
    the block, the manufacture of assets being fielded, and logistical
    support for fielded assets was $19.3 billion.\2\ MDA also notified
    Congress of the Block 2006 performance goals established for the BMDS.
    These goals were composed of numerical values for the probability of
    engagement success, the land area from which the BMDS could deny a
    launch, and the land area that the BMDS could defend.\3\ Fiscal year
    testing goals were also established by element program offices, but
    these goals were not formally reported to Congress.
    ---------------------------------------------------------------------------
        \2\ We have adjusted the cost goal reported to Congress to reflect
    MDA's removal of the THAAD element and its future development cost from
    Block 2006.
        \3\ Specifics of the BMDS performance goals are classified and
    cannot be presented in an open forum.
    ---------------------------------------------------------------------------
        We examined numerous documents and held discussions with agency
    officials. In determining the elements' progress toward Block 2006
    goals, we looked at the accomplishments of six BMDS elements--ABL,
    Aegis BMD, BMDS Sensors, C2BMC, GMD, and STSS--that compose the Block
    2006 configuration. Our work included examining System Element Reviews,
    test plans and reports, production plans, and Contract Performance
    Reports. We also interviewed officials within each element program
    office and within MDA functional offices. In assessing whether MDA's
    flexibility impacts BMDS oversight and accountability, we examined
    documents such as those defining MDA's changes to Block 2006 goals,
    acquisition laws for major DOD programs, and BMDS policy directives
    issued by the Secretary of Defense. We examined the current status of
    MDA's quality assurance program by visiting various contractor
    facilities and holding discussions with MDA officials, such as
    officials in the Office of Quality, Safety, and Mission Assurance. We
    performed our work from June 2006 through March 2007 in accordance with
    generally accepted government auditing standards

     MDA HAS MADE PROGRESS WITH BLOCK 2006, BUT SCOPE HAS BEEN REDUCED AND
                               COSTS HAVE GONE UP

        MDA made progress during fiscal year 2006, but it will not achieve
    the goals it set for itself in March 2005. One year after establishing
    its Block 2006 goals, the agency informed Congress that it planned to
    field fewer assets, reduce performance goals, and increase the block's
    cost goal. It is also likely that in addition to fielding fewer assets,
    other Block 2006 work will be deferred to offset growing contractor
    costs. MDA is generally on track to meet its revised quantity goals,
    but the performance of the BMDS cannot yet be fully assessed because
    there have been too few flight tests conducted to anchor the models and
    simulations that predict overall system performance. Several elements
    continue to experience technical problems that pose questions about the
    performance of the fielded system and could delay the enhancement of
    future blocks. In addition, the Block 2006 cost goal cannot be
    reconciled with actual costs because work travels to and from other
    blocks and individual element program offices report costs
    inconsistently.
        During the first year of Block 2006, MDA continued to improve the
    BMDS by enhancing its performance and fielding additional assets. In
    addition, the BMDS elements achieved some notable test results. For
    example, the GMD element completed its first successful intercept
    attempt since 2002. The test was also notable because it was an end-to-
    end test of one engagement scenario, the first such test that the
    program has conducted. Also, the Aegis BMD element conducted a
    successful intercept test of its more capable Standard Missile-3 design
    that is being fielded for the first time during Block 2006.
        In March 2006, soon after the formal initiation of Block 2006, MDA
    announced that events such as hardware delays, technical challenges,
    and budget cuts were causing the agency to field fewer assets than
    originally expected. MDA's goal now calls for fielding three fewer GMD
    interceptors; deferring the upgrade of the Thule radar until Block
    2008, when it can be fully upgraded; producing four fewer Aegis BMD
    missiles; upgrading one less Aegis destroyer for the engagement
    mission; and delivering three C2BMC Web browsers rather than the more
    expensive C2BMC suites. With the exception of the GMD interceptors, MDA
    is on track to deliver the revised quantities. The GMD program planned
    to emplace eight interceptors during calendar year 2006, but was only
    able to emplace four. Program officials told us that the contractor has
    increased the number of shifts that it is working and that this change
    will accelerate deliveries. However, to meet its quantity goal, the GMD
    program will have to more than double its interceptor emplacement rate
    in 2007.
        MDA also reduced the performance expected of Block 2006
    commensurate with the reduction in assets. However, insufficient data
    are available to determine whether MDA is on track to meet the new
    goal. Although the GMD test program has achieved some notable results,
    officials in DOD's Office of the Director of Operational Test and
    Evaluation told us that the element has not completed sufficient tests
    to provide a high level of confidence that the BMDS can reliably
    intercept intercontinental ballistic missiles. Further testing is
    needed as well to confirm that GMD can use long-range tracking data
    developed by Aegis BMD to prepare--in real time--a weapon system task
    plan for GMD interceptors.
        Delayed testing and technical problems may also impact the
    performance of the current and future configurations of the BMDS. For
    example, the performance of the Block 2006 configuration of the Aegis
    BMD missile is unproven because design changes in the missile's solid
    attitude and divert system and one burn pattern of the third stage
    rocket motor were not flight-tested before they were cut into the
    production line. The current configuration of the GMD interceptor also
    continues to struggle with an anomaly that has occurred in each of the
    element's flight tests. The anomaly has not yet prevented the program
    from achieving its primary test objectives, but neither its source nor
    a solution has been clearly identified or defined. The reliability of
    some GMD interceptors remains uncertain as well because inadequate
    mission assurance/quality control procedures may have allowed less
    reliable or inappropriate parts to be incorporated into the
    manufacturing process. Program officials plan to introduce new parts
    into the manufacturing process, but not until interceptor 18. MDA also
    plans to retrofit the previous 17 interceptors, but not until fiscal
    year 2009. In addition to the performance problems with elements being
    fielded, the ABL element that is being developed to enhance a future
    BMDS configuration experienced technical problems with its Beam
    Control/Fire Control component. These problems have delayed a lethality
    demonstration that is needed to demonstrate the element's leading-edge
    technologies. ABL is an important element because if it works as
    desired, it will defeat enemy missiles soon after launch, before decoys
    are released to confuse other BMDS elements. MDA plans to decide in
    2009 whether ABL or KEI, whose primary boost phase role is to mitigate
    the risk in the ABL program, will become the BMDS boost phase
    capability.
        While MDA reduced Block 2006 quantity and performance goals, it
    increased the block's cost goal from about $19.3 billion to
    approximately $20.3 billion.\4\ The cost increases were caused by the
    addition of previously unknown operations and sustainment requirements,
    realignment of the GMD program to support a successful return to
    flight, realignment of the Aegis BMD program to address technical
    challenges and invest in upgrades, and preparations for round-the-clock
    operation of the BMDS. Although MDA is expected to operate within its
    revised budget of $20.3 billion, the actual cost of the block cannot be
    reconciled with the cost goal. To stay within its Block 2004 budget,
    MDA shifted some of that block's work to Block 2006 and is counting it
    as a cost of Block 2006, which overstates Block 2006 cost. In addition,
    MDA officials told us that it is likely that some Block 2006 work will
    be deferred until Block 2008 to cover the $478 million fiscal year 2006
    budget overruns experienced by five of the six element prime
    contractors. If MDA reports the cost of deferred work as it has in the
    past, the actual cost of Block 2006 will be complicated further.
    Another factor complicating the reconciliation of Block 2006 cost is
    that the elements report block cost inconsistently. Some elements
    appropriately include costs that the program will incur to reach full
    capability, while others do not.\5\
    ---------------------------------------------------------------------------
        \4\ Specific details regarding the cost increase can be found in
    GAO-07-387.
        \5\ An element has reached full capability if it has completed all
    system-level testing and has shown that it meets expectations. At this
    state, all doctrine, organization, training, material, leadership,
    personnel, and facilities are in place.
    ---------------------------------------------------------------------------
       MDA'S FLEXIBILTY MAKES OVERSIGHT AND ACCOUNTABILITY MORE DIFFICULT

        Because the BMDS has not formally entered the system development
    and demonstration phase of the acquisition cycle, it is not yet
    required to apply several important oversight mechanisms contained in
    certain acquisition laws that, among other things, provide transparency
    into program progress and decisions. This has enabled MDA to be agile
    in decisionmaking and has facilitated fielding an initial BMDS
    capability quickly. On the other hand, MDA operates with considerable
    autonomy to change goals and plans, making it difficult to reconcile
    outcomes with original expectations and to determine the actual cost of
    each block and of individual operational assets.
        Over the years, a framework of laws has been created that make
    major defense acquisition programs accountable for their planned
    outcomes and cost, give decisionmakers a means to conduct oversight,
    and ensure some level of independent program review. The application of
    many of these laws is triggered by a program's entry into system
    development and demonstration. To provide accountability, once major
    defense programs cross this threshold, they are required by statute to
    document program goals in an acquisition program baseline that as
    implemented by DOD has been approved by a higher-level DOD official
    prior to the program's initiation. The baseline provides decisionmakers
    with the program's best estimate of the program's total cost for an
    increment of work, average unit costs for assets to be delivered, the
    date that an operational capability will be fielded, and the weapon's
    intended performance parameters. Once approved, major acquisition
    programs are required to measure their program against the baseline,
    which is the program's initial business case, or obtain the approval of
    a higher-level acquisition executive before making significant changes.
    Programs are also required to regularly provide detailed program status
    information to Congress, including information on cost, in Selected
    Acquisition Reports. In addition, Congress has established a cost-
    monitoring mechanism that requires programs to report significant
    increases in unit cost measured from the program baseline.\6\
    ---------------------------------------------------------------------------
        \6\ 10 U.S.C. 2433, known as Nunn-McCurdy.
    ---------------------------------------------------------------------------
        Other statutes provide for independent program verifications and
    place limits on the use of appropriations. For example, 10 U.S.C. 2434
    prohibits the Secretary of Defense from approving system development
    and demonstration unless an independent estimate of the program's life-
    cycle cost has been conducted by the Secretary. In addition, 10 U.S.C.
    2399 requires completion of initial operational test and evaluation
    before a program can begin full-rate production. These statutes ensure
    that someone external to the program examines the likelihood that the
    program can be executed as planned and will yield a system that is
    effective and suitable for combat. The use of an appropriation is also
    controlled so that it will not be used for a purpose other than the one
    for which it was made, except as otherwise provided by law. Research
    and development appropriations are typically specified by Congress to
    be used to pay the expenses of basic and applied scientific research,
    development, test, and evaluation. On the other hand, procurement
    appropriations are, in general, to be used for production and
    manufacturing. In the 1950s, Congress established a policy that items
    being purchased with procurement funds be fully funded in the year that
    the item is procured. This is meant to prevent a program from
    incrementally funding the purchase of operational systems. Full funding
    ensures that the total procurement costs of weapons and equipment are
    known to Congress upfront and that one Congress does not put the burden
    on future Congresses of deciding whether they should appropriate
    additional funds or expose weapons under construction to uneconomic
    start-up and stop costs.
        The flexibility to defer application of specific acquisition laws
    has benefits. MDA can make decisions faster than other major
    acquisition programs because it does not have to wait for higher-level
    approvals or independent reviews. MDA's ability to quickly field a
    missile defense capability is also improved because assets can be
    fielded before all testing is complete. MDA considers the assets it has
    fielded to be developmental assets and not the result of the production
    phase of the acquisition cycle. Additionally, MDA enjoys greater
    flexibility than other programs in the use of its funds. Because MDA
    uses research and development funds to manufacture assets, it is not
    required to fully fund those assets in the year of their purchase.
    Therefore, as long as its annual budget remains fairly level, MDA can
    request funds to address other needs.
        On the other hand, the flexibilities granted MDA make it more
    difficult to conduct program oversight or to hold MDA accountable for
    the large investment being made in the BMDS program. Block goals can be
    changed by MDA, softening the baseline used to assess progress toward
    expected outcomes. Similarly, because MDA can redefine the work to be
    completed during a block, the actual cost of a block cannot be compared
    with the original cost estimate. MDA considers the cost of deferred
    work, which may be the delayed delivery of assets or other work
    activities, as a cost of the block in which the work is performed even
    though the work benefits or was planned for a prior block. Further, MDA
    does not track the cost of the deferred work and, therefore, cannot
    make adjustments that would match the cost with the block that is
    benefited. For example, during Block 2004, MDA deferred some planned
    development, deployment, characterization, and verification activities
    until Block 2006 so that it could cover contractor budget overruns. The
    costs of the activities are now considered part of the cost of Block
    2006. Also, although Congress provided funding for these activities
    during Block 2004, MDA used these funds for the overruns and will need
    additional funds during Block 2006 to cover their cost. Planned and
    actual unit costs of fielded assets are equally difficult to reconcile.
    Because MDA is not required to develop an approved acquisition program
    baseline, it is not required to report the expected average unit cost
    of assets. Also, because MDA is not required to report significant
    increases in unit cost,\7\ it is not easy to determine whether an
    asset's actual cost has increased significantly from its expected cost.
    ---------------------------------------------------------------------------
        \7\ Because the BMDS or its major elements have not been designated
    by MDA as being in system development and demonstration, no acquisition
    program baseline is required under 10 U.S.C. Sec. 2435. Thus there is
    no basis for determining unit cost under 10 U.S.C. Sec. 2433 (also
    known as Nunn-McCurdy), which requires calculation of unit cost from
    the baseline. Further, for the same reason, only limited Selected
    Acquisition Reports to Congress on program status are generated (10
    U.S.C. 2432(h)) that do not include unit costs.
    ---------------------------------------------------------------------------
        Finally, using research and development funds to purchase fielded
    assets further reduces cost transparency because these dollars are not
    covered by the full-funding policy as are procurement funds. Therefore,
    when a program for a 2-year block is first presented in the budget,
    Congress is not necessarily fully aware of the dimensions and cost of
    that block. For example, although a block may call for the delivery of
    a specific number of interceptors, the full cost of those interceptors
    is requested over 3 to 5 years. Calculating unit costs from budget
    documents is difficult because the cost of components that will become
    fielded assets may be spread across 3 to 5 budget years--a consequence
    of incremental funding.

                MDA AUDITS SHOW IMPROVEMENT IN QUALITY PROCESSES

        During Block 2004, poor quality control procedures caused the
    missile defense program to experience test failures and slowed
    production. MDA has initiated a number of actions to correct quality
    control weaknesses, and the agency reports that these actions have been
    largely successful. Although MDA continues to identify quality
    assurance procedures that need strengthening, recent audits by MDA's
    Office of Quality, Safety, and Mission Assurance show such improvements
    as increased on-time deliveries, reduced test failures, and sustained
    improvement in product quality.
        MDA has taken a number of steps to improve quality assurance. These
    include developing a teaming approach to restore the reliability of key
    suppliers, conducting regular quality inspections to quickly identify
    and find resolutions for quality problems, adjusting award fee plans to
    encourage contractors to maintain a good quality assurance program and
    encourage industry best practices, as well as placing MDA-developed
    assurance provisions on prime contracts. For example, as early as 2003,
    MDA made a critical assessment of a key supplier's organization and
    determined that the supplier's manufacturing processes lacked
    discipline, its corrective action procedures were ineffective, its
    technical data package was inadequate, and personnel were not properly
    trained. The supplier responded by hiring a Quality Assurance Director,
    five quality assurance professionals, a training manager, and a
    scheduler. In addition, the supplier installed an electronic problem-
    reporting database, formed new boards--such as a failure review board--
    established a new configuration management system, and ensured that
    manufacturing activity was consistent with contract requirements.
    During different time periods between March 2004 and August 2006, MDA
    measured the results of the supplier's efforts and found a 64-percent
    decrease in open quality control issues, a 43-percent decline in test
    failures, and a 9-percent increase in on-time deliveries. MDA expanded
    its teaming approach in 2006 to another problem supplier and reports
    that many systemic solutions are already underway.
        During fiscal year 2006, MDA's audits continued to identify both
    quality control weaknesses and quality control procedures that
    contractors are addressing. During 2006, the agency audited six
    contractors and identified 372 deficiencies and observations.\8\ As of
    December 2006, the 6 contractors had collectively closed 157, or 42
    percent, of the 372 audit findings. MDA also reported other signs of
    positive results. For example, in 2006, MDA conducted a follow-on audit
    of Raytheon, the subcontractor for GMD's exoatmospheric kill vehicle. A
    2005 audit of Raytheon had found that the subcontractor was not
    correctly communicating essential kill vehicle requirements to
    suppliers, did not exercise good configuration control, and could not
    build a consistent and reliable product. The 2006 audit was more
    positive, reporting less variability in Raytheon's production
    processes, increasing stability in its statistical process control
    data, fewer test problem reports and product waivers, and sustained
    improvement in product quality.
    ---------------------------------------------------------------------------
        \8\ Deficiencies are considered more serious and are recognized
    when contractors do not comply with a contractual or internal procedure
    requirement. On the other hand, observations are made when a contractor
    fails to employ an MDA or industry best practice.
    ---------------------------------------------------------------------------
                    ACTIONS RECOMMENDED IN OUR RECENT REPORT

        In our March 15, 2007, report, we made several recommendations to
    DOD to increase transparency in the missile defense program. These
    included:

             Develop a firm cost, schedule, and performance
            baseline for those elements considered far enough along to be
            in system development and demonstration, and report against
            that baseline.
             Propose an approach for those same elements that
            provides information consistent with the acquisition laws that
            govern baselines and unit cost reporting, independent cost
            estimates, and operational test and evaluation for major DOD
            programs. Such an approach could provide necessary information
            while preserving the MDA Director's flexibility to make
            decisions.
             Include in blocks only those elements that will field
            capabilities during the block period and develop a firm cost,
            schedule, and performance baseline for that block capability,
            including the unit cost of its assets.
             Request and use procurement funds, rather than
            research, development, test, and evaluation funds, to acquire
            fielded assets.

        DOD partially agreed with the first three recommendations and
    recognized the need for greater program transparency. It committed to
    provide information consistent with the acquisition laws that govern
    baselines and unit cost reporting, independent cost estimates, and
    operational test and evaluation. DOD did not agree to use elements as a
    basis for this reporting, expressing its concern that an element-
    centric approach to reporting would have a fragmenting effect on the
    development of an integrated system. We respect the need for the MDA
    Director to make decisions across element lines to preserve the
    integrity of the system of systems. We recognize that there are other
    bases rather than elements for reporting purposes. However, we believe
    it is essential that MDA report in the same way that it requests funds.
    Currently MDA requests funds and contracts by element, and at this
    time, that appears to be the most logical way to report. MDA currently
    intends to modify its current block approach. We believe that a
    management construct like a block is needed to provide the vehicle for
    making system-of-system decisions and to provide for system-wide
    testing. However, at this point, the individual assets to be managed in
    a block--including quantities, cost, and delivery schedules--can only
    be derived from the individual elements.
        Mr. Chairman, this concludes my statement. I would be pleased to
    respond to any questions you or members of the subcommittee may have.

        Senator Bill Nelson. Thank you.
        Mr. Green?

      STATEMENT OF BRIAN R. GREEN, DEPUTY ASSISTANT SECRETARY OF
        DEFENSE FOR STRATEGIC CAPABILITIES, OFFICE OF THE UNDER
      SECRETARY OF DEFENSE FOR POLICY BEFORE THE SUBCOMMITTEE ON
                STRATEGIC FORCES, DEPARTMENT OF DEFENSE

        Mr. Green. Chairman Nelson, Ranking Member Sessions, and
    members of the subcommittee, it's a pleasure to appear before
    you today to discuss the policy and strategic rationale
    underpinning the fiscal year 2008 missile defense budget
    request.
        In 2001, President Bush directed us to field an initial
    missile defense capability by 2004, and to improve it over time
    to meet the changing threat, and to take advantage of emerging
    technology. He also directed us to extend the benefits of
    missile defense to our friends and allies.
        I would like to discuss today our progress in meeting this
    direction, and focus on an effort that is key to enabling us to
    meet these goals, the deployment of U.S. missile defenses in
    Europe.
        Missile defense continues to be one of the administration's
    highest priorities, driven by rapidly-evolving missile threats.
    Aggressive and unpredictable adversaries such as Iran and North
    Korea, continue to challenge our notions of deterrence and
    defense. Surprise --strategic, tactical, and technical--is an
    expected feature of the post-Cold War strategic environment. In
    this environment, we can no longer rely solely on offensive
    capabilities to deter our adversaries. We must have other
    options, including missile defenses, that both reinforce
    deterrence, and hedge against its potential failure.
        I'm pleased to report that we've made substantial and rapid
    progress in meeting the President's direction to deploy missile
    defense capabilities. These have been well-described by General
    Obering.
        My colleagues seated with me at the table today who
    represent the developers, the testers and the warfighters,
    deserve the Nation's gratitude, and I would be remiss if I
    didn't thank Congress and this Committee for its support as
    well.
        We're also making progress in missile defense cooperation
    with our allies and our friends. Today, 15 additional
    countries, including 9 NATO nations alone, are engaged in
    missile defense efforts of some kind, whether by hosting key
    facilities or assets on their territory, or actively discussing
    this possibility, or pursuing R&D programs, examining options
    in technical working groups, signing cooperative agreements
    with the U.S., or maintaining capabilities.
        In January of this year, President Bush directed us to
    proceed with negotiations to base U.S. long-range missile
    defenses in Europe. These defenses are intended to counter the
    increasing Middle Eastern missile threat. Our intelligence
    community assesses that Iran would be able to develop an ICBM
    capability before 2015, if it chose to do so, and we must start
    now in order to address this threat in a timely manner.
        The current plans call for basing 10 GBIs in Poland similar
    to those currently deployed in Alaska and California, and a
    midcourse radar in the Czech Republic.
        The deployment of these U.S. missile defense assets in
    Europe will have many benefits. They would be capable of
    intercepting not only ICBMs, but also intermediate-range
    ballistic missiles launched out of the Middle East. The U.S.
    goal is to optimize the defensive coverage of both Europe, and
    the U.S. It would provide a second layer of defense for the
    United States.
        With the protection afforded by these U.S. defensive
    capabilities in Europe, NATO member-states could resist
    attempts by hostile states to intimidate or coerce the alliance
    or its members from taking actions in a coalition.
    Strengthening our European allies and the NATO alliance, in
    turn, enhances U.S. security.
        The defense of Europe against longer-range threats, similar
    to those which the United States is defending itself, will be
    important to keep U.S. and NATO security tightly coupled. Such
    defenses would provide additional decision space for national
    leaders, including the President, for example, by allowing them
    to delay or defer resorting to offensive responses to an
    attack.
        Missile defenses provide another avenue for burdensharing,
    and strengthening relationships with important allies. When
    negotiations are successfully concluded, Poland and the Czech
    Republic will be providing a significant contribution to the
    collective security of the NATO alliance by hosting BMD assets.
        I also want to comment briefly on the benefits derived
    specifically from the basing mode that we've chosen to pursue,
    that is, ground-basing interceptors and silos. Many of our
    missile defense, assets such as Aegis and PAC-3, are mobile or
    transportable. The advantage of mobility is flexibility. We can
    move assets into place as circumstances warrant.
        There's also an advantage to ground-based silos, and that
    advantage is persistence. If we field long-range interceptors
    and silos in Europe, we will have a capability that is always
    there--before and during a crisis. With our allies and
    potential adversaries, we'll know with certainty that a missile
    defense capability is in place. These missile defense assets,
    then, will be able to both assure allies, and to deter and
    dissuade adversaries at all times, once they're fielded.
        While we see many benefits from a deployment in Europe,
    some in Russia have expressed their opposition, contending that
    our limited missile defenses constitute a threat to the
    strategic balance. I would say, first and foremost, that we no
    longer look at Russia as a strategic adversary, and therefore,
    there is no strategic balance to disturb. Furthermore, physics
    and geography prove that ground-based missile defense
    interceptors and a X-band radar for a mid-course tracking and
    discrimination of warheads, located in Central Europe, would
    have no capability against an ICBM launched out of Russia at
    the United States in a one-on-one engagement.
        Finally, 10 interceptors in Europe are simply not a threat
    to Russia, and cannot diminish Russia's deterrent of hundreds
    of missiles, and thousands of warheads. Providing Russia
    transparency and predictability in our missile defense policy,
    plans, and programs is certainly in the interest of the United
    States. We've provided this in the past, and are continuing to
    keep Russia informed about the status of our programs and
    decisions. We will also explore the possibility of additional
    confidence-building measures, and we seek opportunities to
    cooperate in missile defense in the future. President Bush
    recently underscored that point to President Putin.
        I mentioned previously that a European interceptor site
    will provide long-range missile defense coverage to many NATO
    allies. Missile defense has been a topic of discussion and
    debate at NATO for quite some time, and the U.S. plan to begin
    fielding missile defense elements in Europe has served to focus
    and intensify those discussions.
        The Alliance has already taken several important steps
    demonstrating its support for missile defense. With its Active-
    Layered Theater Ballistic Missile Defense (ALTBMD) Program, the
    Alliance has decided to develop a capability to defend its
    deployed forces from shorter-range missile attack.
        Recognizing a growing threat to NATO territory, the
    Alliance agreed at the 2002 Prague Summit to initiate the NATO
    Missile Defense Feasibility Study to examine the defense of
    alliance territory and population centers from ballistic
    missile attack. This study was completed and presented to the
    2006 Riga Summit. At Riga, the Alliance endorsed the study's
    conclusion that defense of alliance territory and population
    centers is technically feasible.
        We are continuing to consult extensively with NATO to
    ensure that all of our allies understand the contribution
    missile defense can make to alliance security and solidarity.
    Although the alliance has yet to make the collective decision
    to pursue continental defense, a number of allies have
    demonstrated support for long-range missile defense. Poland and
    the Czech Republic have expressed interest in hosting long-
    range missile defense assets, the United Kingdom agreed to an
    upgrade to the Fylingdales radar, and Denmark has agreed to a
    similar upgrade of the early-warning radar at Thule, Greenland.
        In conclusion, we have made great progress in meeting the
    goals the President set for us over 4 years ago, and we
    continue to press forward with the proposed deployment of U.S.
    missile defenses in Europe.
        That concludes my statement. Thank you for your attention.
    I appreciate the opportunity to be here, and I look forward to
    your questions.
        [The prepared statement of Mr. Green follows:]

                      Prepared Statement by Brian R. Green

                                  INTRODUCTION

        Chairman Nelson, Ranking Member Sessions, and members of the
    subcommittee, it is a pleasure to appear before you today. I am here to
    discuss missile defense in the context of national defense strategy and
    to review our progress in carrying out the President's ballistic
    missile defense policy.

                           NEW STRATEGIC ENVIRONMENT

        Ballistic missile defense remains a top priority of the
    administration. This priority is driven by needs defined by the new and
    evolving strategic environment, and continues to be validated by recent
    events.
        Our national security focus changed in the early 1990s with the
    demise of the Soviet Union. We realized that we faced a broader range
    of threats from a broader range of aggressive and unpredictable
    adversaries. Threats posed by nations, such as Iran and North Korea,
    and transnational non-state actors, such as al Qaeda, continue to
    challenge our notions of deterrence and defense. Surprise--strategic,
    tactical, and technical--is an expected feature of the security
    landscape. While deterrence remains the cornerstone of our strategy, we
    recognize an increased risk that deterrence may fail. Under such
    circumstances, missile defenses are highly desirable because they both
    reinforce deterrence and hedge against its failure.
        Potential adversaries see ballistic missiles armed with weapons of
    mass destruction (WMD) as low-cost, high impact asymmetric options to
    counter other U.S. military advantages. WMD and ballistic missile
    delivery vehicles have become the weapon of choice for countries
    seeking to coerce their neighbors and limit U.S. freedom of action. LTG
    Michael Maples, Director of the Defense Intelligence Agency, said
    earlier this year that ``after global terrorism, the proliferation of
    weapons of mass destruction remains the most significant threat to our
    homeland, deployed forces, allies and interests.''
        The threat from the increasing numbers and capabilities of
    ballistic missiles is pronounced. This threat is highlighted by
    proliferation of ballistic missiles by countries such as North Korea
    and China, and secretive weapons proliferation networks, such as the
    one run by A.Q. Khan, selling nuclear technology and expertise. Not
    only is the threat from the numbers and capabilities of ballistic
    missiles increasing, but the group of countries possessing ballistic
    missiles includes some of the world's most threatening and least
    responsible regimes, such as North Korea and Iran.
        As LTG Maples recently testified before the Senate Select Committee
    on Intelligence in unclassified session, ``North Korea has an ambitious
    ballistic missile development program and has exported missiles and
    missile technology to other countries, including Iran and Pakistan.
    North Korea continues to develop the Taepo Dong 2, which could reach
    parts of the United States and is capable of carrying a nuclear
    payload. On 4 July 2006, North Korea conducted seven widely-publicized
    missile launches. The Taepo Dong 2 space launch vehicle /
    intercontinental ballistic missile was flight-tested for the first time
    and failed shortly after launch. Despite the failure of the Taepo Dong
    2, North Korea successfully tested six theater ballistic missiles,
    demonstrating the capability to target U.S. forces and our allies in
    South Korea and Japan. North Korea is also developing a new
    intermediate-range ballistic missile and a new short-range, solid-
    propellant ballistic missile. Export of North Korea ballistic missiles
    will continue to be a concern.''
        Turning to the Middle East, Iran represents a dangerous nexus,
    combining a vigorous ballistic missile program, a nuclear program that
    we assess also reflects a desire to develop nuclear weapons, and a
    history of support for international terrorism. Terrorism has been part
    of Tehran's arsenal for decades. In fact, before the September 11
    attacks, more Americans had been killed by Iranian-backed terrorists
    like Hezbollah than by any other terrorist group. Iran has made
    ballistic missiles an important part of its defense strategy. As former
    Director of National Intelligence, John Negroponte, testified last
    year, ``The danger that it will acquire a nuclear weapon and the
    ability to integrate it with the ballistic missiles Iran already
    possesses is a reason for immediate concern. Iran already has among the
    largest inventory of ballistic missiles in the Middle East, and Tehran
    views its ballistic missiles as an integral part of its strategy to
    deter--and if necessary retaliate against--forces in the region,
    including U.S. forces.''
        In this environment, recent statements by Iranian President Ahmadi-
    Nejad threatening the United States and its friends in the region, most
    notably Israel, are of particular concern. In October 2005, Ahmadi-
    Nejad declared that ``Israel should be wiped off the map. God willing,
    with the force of God behind it, we shall soon experience a world
    without the United States and Zionism.'' He also said that ``anybody
    who recognizes Israel will burn in the fire of the Islamic nation's
    fury.''
        Iran also continues to develop ballistic missiles of increasing
    range and sophistication that may one day be able to deliver a nuclear
    weapon. Lt. Gen. Maples recently testified before the Senate Select
    Committee on Intelligence that Iran continues its efforts to develop
    and acquire ballistic missiles capable of striking Israel and Europe.
    Iran's ballistic missiles already cast a shadow over U.S. friends and
    allies, and our deployed forces, in the Middle East. Moreover, the
    Intelligence Community assesses that Iran would be able to develop an
    ICBM before 2015 if it chose to do so. The addition of nuclear warheads
    and an ICBM that could reach the U.S. would further extend Iran's
    ability to coerce others and threaten the U.S.
        Iran has also claimed it is pursuing a space-launch capability.
    Although space launch vehicles can be used for peaceful purposes, if
    Iran were to achieve such a capability, it would also be demonstrating
    the key technologies needed to deliver payloads at intercontinental
    ranges.

                OVERALL DEFENSE STRATEGY AND U.S. DEFENSE GOALS

        Ballistic missile defenses remain an important part of our overall
    defense strategy. Last year, the Department of Defense released the
    2006 Quadrennial Defense Review (QDR). The QDR recognized U.S.
    superiority in traditional warfare, but stressed that improvements are
    needed in non-traditional warfare. The QDR identified a number of
    priorities to operationalize the National Defense Strategy, including:
    1) defending the homeland in depth; 2) shaping the choices of countries
    at strategic crossroads; and 3) preventing hostile states and non-state
    actors from acquiring or using weapons of mass destruction. Ballistic
    missile defenses can make important contributions to each of these
    priorities. They can be part of a layered defense against the use of
    ballistic missiles to attack the population and territory of the U.S.,
    its deployed forces, or its friends and allies. They can also help
    dissuade countries from choosing to compete militarily with the U.S by
    increasing the cost of competition and decreasing the certainty that a
    ballistic missile attack will succeed.
        The 2001 QDR outlined four broad defense policy goals: to assure,
    dissuade, deter, and if necessary, defend and defeat. Missile defenses
    support these goals in the following ways:

              Assure allies and friends that threats by nations armed with
            ballistic missiles will not be able to deter the U.S. from
            fulfilling its security commitments, coerce our allies, or
            undermine a coalition;
              Dissuade potential adversaries from investing in or
            developing ballistic missiles by reducing the value of such
            weapons;
              Deter ballistic missile attacks and threats by reducing an
            adversary's confidence in the success of an attack; and
              Defeat missile attacks against the United States, its
            deployed forces, and its friends and allies in the event that
            deterrence fails.

                             PRESIDENTIAL DIRECTION

        Upon taking office, President Bush embarked on a bold new course
    for strategic deterrence and defense. The President issued NSPD-23,
    National Policy on Ballistic Missile Defense. The President directed us
    to field an initial missile defense capability in 2004 consisting of
    ground- and sea-based interceptors, additional Patriot units, and
    sensors on land, at sea, and in space. The initial capability was only
    a starting point. Using an evolutionary acquisition approach, we are
    improving these capabilities over time to meet the changing threat and
    to take advantage of emerging technology. We must continue a robust
    research and development effort, in addition to fielding adequate
    quantities of interceptors.
        As technology changes over time, so will the composition of our
    missile defense force. There will be no fixed, final force structure.
    We will change the number and locations of our missile defenses to
    counter emerging threats and to take advantage of geographic
    opportunities. Some threats, like Libya, may recede, while others, like
    Iran, will grow. Our missile defenses must have global reach to counter
    threats wherever they may appear.
        The U.S. is making steady progress in meeting these goals. We now
    have ground-based interceptors deployed in Alaska and California; sea-
    based interceptors available for deployment aboard Aegis Cruisers and
    Destroyers; more Patriot units; sensors on land, at sea and in space;
    an evolving command and control system to tie it all together; and
    trained warfighters on station.

                   INTERNATIONAL MISSILE DEFENSE COOPERATION

        International cooperation is one of the cornerstones of our
    national policy on ballistic missile defense. In 2002, the President
    directed that missile defense cooperation will be a feature of U.S.
    relations with close, longstanding allies, and an important means to
    build new relationships with new friends. The U.S. has made progress in
    carrying out this direction, with cooperative efforts underway with
    many countries. Today, 15 countries (including 9 in NATO alone) are
    engaged in missile defense efforts of some kind, whether by hosting key
    facilities or assets on their territory or actively discussing this
    possibility, pursuing R&D programs, signing cooperative agreements with
    the U.S., or maintaining capabilities. In addition to the U.S., the
    list includes Australia, the Czech Republic, Denmark, France, Germany,
    Italy, Israel, India, Japan, the Netherlands, Poland, Spain, Taiwan,
    Ukraine, and the U.K. I would point out that Russia clearly believes in
    the value of missile defense as it continues to maintain a missile
    defense system around its major population center, Moscow, and has
    developed defenses against shorter-range missiles.
        Let me briefly describe some of these allied efforts.

             North Korean ballistic missiles pose a direct and
            immediate threat to Japan. This threat encouraged Japan to seek
            closer cooperation with the U.S. The Japanese are now one of
            our pre-eminent missile defense partners.

                     Japan is deploying a multi-layered system
                    comprised of upgraded Aegis ships with Standard
                    Missile-3 (SM-3) interceptors, Patriot Advanced
                    Capability-3 (PAC-3) systems, new and refurbished
                    warning radars and an upgraded command and control
                    system.
                     Japan and the U.S. are co-developing the SM-3
                    Block IIA, the next-generation sea-based interceptor.
                    This larger, more capable interceptor will enable Aegis
                    ships to intercept longer-range missiles.
                     Japan agreed to host a U.S. forward-based X-
                    band missile defense radar.
                     Four U.S. Aegis engagement ships are forward-
                    deployed to Japan, along with several more missile
                    defense surveillance and tracking ships.
                     We deployed a U.S. PAC-3 battalion to Japan
                    last year.o We are also deepening coordination of our
                    missile defense operations and to share missile defense
                    information.

             We are cooperating with Israel on the Arrow System
            Improvement Program. The Arrow System is now deployed and
            protecting Israeli citizens and territory.
             Germany, Italy, and the U.S. are co-developing the
            Medium Extended Air Defense System, a replacement for Patriot
            systems in the next decade.
             We have upgraded and are testing the early warning
            radar at Fylingdales, U.K. this year; a second early warning
            radar in Thule, Greenland, is scheduled to be upgraded and
            tested in a few years.
             NATO is developing the Active Layered Theater
            Ballistic Missile Defense system, a command and control
            backbone for member countries' theater missile defenses. In
            addition, the NATO Feasibility Study released in 2005 confirmed
            that missile defenses to protect European citizens are, indeed,
            feasible.
             We have concluded agreements with the U.K., Japan,
            Australia, Israel, Italy, and Denmark to facilitate government-
            to-government and industry-to-industry missile defense
            cooperation. We are also holding discussions or working on
            technology efforts with Germany, India, the Netherlands, Spain,
            Ukraine, and France.

        In his 2002 direction, the President specifically called for
    cooperation to build new relationships with other nations, like Russia.
    While that prospect at times seems remote, there are positive
    developments to report. We are continuing negotiations on a Defense
    Technical Cooperation Agreement with Russia to facilitate both
    government-to-government as well as industry-to-industry missile
    defense cooperation, and we continue to seek practical areas of
    cooperation with Russia on a bilateral basis as well as in the NATO-
    Russia context.

                        U.S. MISSILE DEFENSES IN EUROPE

        In January of this year, President Bush directed us to proceed with
    negotiations to base U.S. long-range missile defenses in Europe. These
    defenses are intended to counter the increasing threat from Iranian
    missiles. Iranian press claims Tehran currently has a 2,000 km range
    ballistic missile capability, which could reach parts of Eastern
    Europe. While our intelligence community assesses that Iran would be
    able to develop an ICBM before 2015 if it chose to do so, we must start
    now in order to address this threat in a timely manner.
        Current plans call for basing in Poland ten Ground-Based
    Interceptors similar to those currently deployed in Alaska and
    California, and a midcourse radar in the Czech Republic. An existing
    midcourse radar at the Reagan Test Range will be refurbished and moved
    to the Czech Republic. Negotiations are ongoing and, pending a
    successful outcome, work is planned to begin at the sites in 2008.
    These missile defense assets would be integrated with existing radars
    in Fylingdales, U.K., and Thule, Greenland, as well as the U.S. Ground-
    based Midcourse Defense system.
        The deployment of U.S. missile defense assets in Europe has many
    benefits:

             They would be capable of intercepting not only
            intercontinental ballistic missiles but also intermediate-range
            ballistic missiles launched out of the Middle East. The U.S.
            goal is to optimize the defensive coverage of both Europe and
            the U.S.
             They would provide a second ``layer'' of defense for
            the U.S.
             With the protection afforded by these U.S. defensive
            capabilities in Europe, NATO member states could resist
            attempts by hostile states to intimidate or coerce the Alliance
            or its members from taking actions in a coalition.
            Strengthening our European allies and the NATO Alliance in turn
            enhances U.S. security.
             They would provide additional decision space for
            national leaders, including the President, for example, by
            allowing them to delay or defer resort to offensive responses
            to an attack.
             Missile defenses provide another avenue for burden
            sharing and strengthening strategic relationships with
            important allies. When negotiations are successfully concluded,
            Poland and the Czech Republic would be providing a significant
            contribution to the collective security of the NATO Alliance by
            hosting BMD assets.

        I also want to comment briefly on benefits derived specifically
    from the basing mode we have chosen to pursue, that is ground basing
    interceptors in silos. Many of our missile defense systems, such as
    Aegis and PAC-3, are mobile or transportable. The advantage of mobility
    is flexibility--we can move assets into place as circumstances warrant.
    But there's also an advantage to ground-based silos. That advantage is
    persistence. If we field long-range interceptors in silos in Europe, we
    will have a capability that is always there--before and during a
    crisis. Both our allies and potential adversaries will know for certain
    that a basic missile defense capability is in place. These missile
    defense assets, then, will be able both to assure allies, and to deter
    and dissuade adversaries at all times once they are fielded.

                             CRITICISM FROM RUSSIA

        While we see many benefits from a deployment in Europe,
    unfortunately some in Russia have expressed their opposition,
    contending that our limited missile defenses constitute a threat to the
    strategic balance. I would say first and foremost, that we do not
    regard Russia as a strategic adversary; hence, there is no strategic
    balance to disturb. These systems are not directed against Russia.
    Furthermore, physics and geography prove that ground-based missile
    defense interceptors and an X-band radar for midcourse tracking and
    discrimination of warheads located in central Europe would have no
    capability against an ICBM launched out of Russia at the United States
    in a one-on-one engagement. Finally, ten interceptors are simply not a
    threat to Russia and cannot diminish Russia's deterrent of hundreds of
    missiles and thousands of warheads.
        Some in Russia also claim that we have not consulted with them and
    answered all of their questions. Yet, we have been transparent with
    Russia regarding our plans for and capabilities of the proposed U.S.
    European missile defense deployment. Senior State, Defense, and MDA
    officials have frequently briefed senior Russian counterparts, as well
    as their experts, in Washington, DC, Moscow, Brussels, and elsewhere.
    Russian officials understand the European-based assets would have no
    capability against Russian ICBMs launched at the United States, and
    that these assets would be optimized for engaging ballistic missile
    threats launched out of the Middle East.
        Providing Russia transparency and predictability in our missile
    defense policy, plans, and programs is certainly in the interest of the
    United States. We will continue to keep Russia informed about the
    status of our programs and decisions, explore the possibility of
    additional confidence-building measures, and seek opportunities to
    cooperate on missile defense in the future.

                            CONSULTATIONS WITH NATO

        I mentioned previously that a European interceptor site will
    provide long-range missile defense coverage to many NATO Allies.
    Missile defense has been a topic of discussion and debate at NATO for
    quite some time, and the U.S. plan to begin fielding missile defense
    elements in Europe has served to focus and intensify these discussions.
        The Alliance has already taken several important steps
    demonstrating its support for missile defense. With its Active Layered
    Theater Ballistic Missile Defense Program, the Alliance has decided to
    develop a capability to defend its deployed forces from shorter-range
    missile attack. The program office, established in 2005, is headed by a
    Frenchman, and his deputy is an American. Recognizing that there is
    also a growing threat to NATO territory, the Alliance agreed at the
    2002 Prague Summit to initiate a NATO Missile Defense Feasibility Study
    to examine the defense of Alliance territory and population centers
    from ballistic missile attack. This study was completed and presented
    to the 2006 Riga Summit. At Riga, the Alliance endorsed the Study's
    conclusion that defense of Alliance territory and population centers is
    technically feasible.
        Although the Alliance has yet to make the collective decision to
    pursue a continental defense, a number of individual Allies have
    demonstrated support for long-range missile defense. For example,
    Poland and the Czech Republic have expressed interest in hosting long-
    range missile defense assets, the United Kingdom has agreed to an
    upgrade of the Fylingdales Early Warning Radar, and Denmark has agreed
    to a similar upgrade of the Early Warning Radar at Thule, Greenland.

                                   CONCLUSION

        In conclusion, we have made great progress in meeting the goals the
    President set over 4 years ago. Missile defenses are an essential
    element of our overall national security strategy to dissuade and deter
    nations from acquiring or using ballistic missiles and to protect our
    citizens from the threat of terrorist attack. As the threat of
    ballistic missiles and WMDs increases, more allies and friends are
    choosing to work with us on missile defense projects. Given these
    results, we will continue the current policies. Subject to your
    questions, this concludes my statement.

        Senator Bill Nelson. As a courtesy to our colleagues, I
    will defer my questions.
        Senator Inhofe.
        Senator Inhofe. Thank you, Mr. Chairman, and Senator
    Sessions for allowing me to jump in a little bit earlier here.
        In your opening statement, Senator Sessions, you talked
    about something that I was concerned about and I would kind of
    like to pursue that a little bit.
        If you're looking at Iran, and some of the things, what
    they were willing to do with their hostages just a week ago,
    what would they do if they had the capability of some kind of a
    missile? I can't help but think that they've demonstrated
    pretty clearly that they would be willing to, if they can hold
    one country hostage with hostages, then what could they do if
    they had that capability, to an entire country? Whether it's
    Israel or someone else.
        Now, our GMD system, you talked about, I think it was you,
    Mr. Green--no, it was you, Dr. McQueary--talked about it's
    coming along, we are doing testing right now, but didn't we
    have 15 out of the last 16 tests, weren't they successful on
    the use of that GMD system?
        General Obering. Sir, I could probably answer that better.
    The 15 of 16 flight tests included more than just the ground-
    based system. But we clearly had a good test with the GMD
    system last September. We've now flown the booster three times,
    and we had the successful intercept in September. Prior to that
    in 2000-2001, we had four or five successful intercepts. So,
    when we get this kill vehicle into the terminal box, so to
    speak, it does take care of the job.
        Senator Inhofe. Well, I guess my thinking is this--even
    though--I know, we always want to have everything tested and
    running perfectly and all of that, but if you have something
    that's been--that is effective, maybe needs a little bit more
    testing, why wouldn't it be a good idea to place such a system
    someplace, so that if you had someone like--we're not dealing
    with normal people when we're talking about North Korea and
    Iran. If they knew that we had something that very likely could
    knock it down, wouldn't that be a deterrent to them?
        General Obering. Sir, you've hit on a key point, and it's
    probably one of the biggest differences in the way that we are
    doing business than the rest of the department. It feeds into
    much of the flexibility that Mr. Francis talked about.
        But what we're doing is, as opposed to being risk-adverse,
    we are managing risk. So, what we do, is we do sufficient
    testing to understand that we have a warfighting capability,
    and we begin to deploy that and get it in the hands of the
    warfighter. We continue to improve, and continue to develop it
    over time, and continue to test it, and that's also what
    General Campbell was talking about in this idea of the
    interaction between the warfighter and the developer.
        So, it's not waiting until you have every ``t'' crossed or
    every ``i'' dotted. You do sufficient testing to get that in
    the hands of the warfighter quickly, because frankly,
    personally speaking, I think we lost a little bit of a sense of
    urgency in the Department during the Cold War, in terms of
    getting that capability out the door to the warfighter.
    Especially in a mission area where we historically had no
    defense. I think it's critical that we get this out as quickly
    as we can, with sufficient testing to understand the behavior.
        Senator Inhofe. I think our intelligence is good, and you
    guys, I know, are pretty aware of the risk that's out there.
    I'm looking at your MDA book here, showing what North Korea
    has, for example, that they have capable right now. I've always
    been a believer that if North Korea has it, it wouldn't be too
    long before Iran would have it. So, I've been concerned about
    this.
        Now, Mr. Green, I appreciate what you said about some
    places in Eastern Europe maybe being ideal for location of
    these defense systems, and would you all agree, generally agree
    with him that the Czech Republic or Poland, or someplace like
    that, would be a good place for this?
        General Obering. Were you asking me, Senator?
        Senator Inhofe. Anybody. Mr. Green has already responded. I
    just wondered if, do you agree with Mr. Green?
        General Obering. We would agree with Mr. Green. As I
    mentioned in my opening statement, we've already worked the
    problem on the western side of our country--North Korea, and it
    makes no sense to me to leave the door open on the eastern side
    now, coming out of Europe. We have a threat that's in a sprint,
    from what I can tell, in developing short-range and medium-
    range missiles.
        So, although our intelligence will tell us we have a
    certain amount of time, I think we need to move now to close
    that door.
        Senator Inhofe. I would think that when you're looking at
    the missile defense budget, it's a half billion dollars below
    where it was in the previous year, or is right now. This
    concerns me, does this--do you think you can stay on track
    with, by reducing, effectively reducing the budget? Then, of
    course, you heard Mr. Francis talk about, in the years to come,
    it's going to be between 8 and 10, so it sounds to me like it's
    going to be a continual reduction. Do you think that's
    adequate?
        General Obering. Sir, we've certainly gone to great extents
    to try to make it a balanced budget, to try to----
        Senator Inhofe. Yes, that's what, the hand you're dealt. Do
    you need a better hand?
        General Obering. Sir, we could always use more money in
    this regard, because I think we could--it goes back to what I
    said previously--we could get more capability out quickly, into
    the hands of the warfighter.
        Senator Inhofe. Mr. Chairman, if this were a hearing on the
    Joint Strike Fighter or FCS, I'd say the same thing. Because,
    you can't take it out of systems right now, that are
    underfunded, and that's kind of what we are dealing with.
        I have another, just, kind of unrelated thing, Mr.
    Chairman, I'd like just to throw out there the--on January 11,
    the Chinese used a modified ICBM to knock down one of their own
    weather satellites, and this to me, this demonstration was, I'm
    not sure what the motive was, but I fear the motive was to let
    us know their capabilities, because the same orbit that is used
    for a weather satellite that is owned by the Chinese, is what
    we would have for intelligence, for reconnaissance.
        I guess my question is, if they can hit their own satellite
    in the same orbit, couldn't they hit ours too? No-brainer?
        General Obering. Sir, if they have demonstrated the ability
    to hit a satellite in low-earth orbit, than it's just a matter
    of targeting at that point.
        Senator Inhofe. So, they could.
        General Obering. Yes, sir, I've----
        Senator Inhofe. And they did.
        General Obering. As for demonstrating all of the building
    blocks, they've demonstrated that.
        Senator Inhofe. In this particular area, we're talking
    about China there, you have the South China Sea, you have the
    Taiwan Straits. If they were to blind us in the middle of
    something, what's the, kind of the worst-case scenario you
    could think of? We'd be sitting there without any way of seeing
    what's going on?
        General Obering. The worst case would be if their intent
    was actually to take action against Taiwan, we might find that
    they'd have their invading force on the island before we could
    react.
        Senator Inhofe. Yes. I know that we have other
    capabilities, we talked about the UAVs, and--but anything else
    that is currently a capability on reconnaissance is going to be
    easier to take out than one of the satellites in orbit, I think
    you'd agree with that, wouldn't you? In which case, what are we
    looking at to take care of that problem, now that we have seen
    what happened on January 11? Are we looking at new technology?
        General Obering. Sir, we in the MDA have not been assigned
    a mission to do counter-anti-satellite (ASAT). It is certainly
    true that much of the technology that we are developing is
    directly applicable to that, and frankly is fairly
    straightforward in terms of application, but we have not been
    given that mission.
        Senator Bill Nelson. Senator, we've been trying for 2
    months to have a hearing on the China ASAT test. We just
    haven't been able to get the witnesses when they're in town so
    that we could do that.
        Senator Inhofe. This is something that really does concern
    me, because it's so obvious what they could do to knock out our
    ability of reconnaissance. I would hope that we are looking at
    technology right now, whether it's you or somebody else, and
    when you have this hearing, I'd like to get a little advance
    notice, because I'm very much concerned about it. I know there
    are other companies out there that are working toward
    suborbital reconnaissance solutions, and I'd like to pursue
    this to be sure they are, if they're not.
        Thank you, Mr. Chairman.
        Senator Bill Nelson. Senator Reed.
        Senator Reed. Thank you very much, Mr. Chairman.
        Thank you, gentlemen.
        Mr. Green, just to clarify the status of the proposed
    deployment in Eastern Europe--10 GBIs perhaps in Poland, and a
    radar in the Czech Republic--this is not a final proposal yet,
    in terms of the administration or the governments in Poland or
    the Czech Republic, it is still at the discussion stage?
        Mr. Green. Senator, we have exchanged diplomatic notes,
    both governments have expressed a willingness, a desire to go
    into negotiations on these facilities, we are starting those
    negotiations and we expect to pursue those vigorously over the
    next several months.
        Senator Reed. But there's not a final agreement even at the
    governmental levels as far as location and responsibilities.
    That's still all to be negotiated?
        Mr. Green. There are several parts of the negotiating
    process, one of them would be a main missile defense agreement
    that would define in great detail the obligations and
    responsibilities of both parties, and that is what we'll be
    negotiating over the next several months.
        Senator Reed. Would those agreements have to be approved by
    the parliaments of the respective countries, Poland and Czech
    Republic?
        Mr. Green. Those would be subject to parliamentary
    approval, yes, sir.
        Senator Reed. Were they subject to approval by the United
    States Congress?
        Mr. Green. We treat those as executive agreements, so we
    would not, they're not considered to be treaties, so they
    wouldn't be submitted to the Senate.
        Senator Reed. So, they would be submitted to the Polish
    Congress, and the Czech Congress, but not the United States
    Congress?
        Mr. Green. That's correct.
        Senator Reed. There is a possibility, of course, that even
    as the negotiations take place that the Polish and Czech
    Congress could reject them. That's a possibility?
        Mr. Green. There's always that possibility, Senator.
    Obviously, we have entered into these negotiations with a very
    high expectation of success, and the governments of both Poland
    and the Czech Republic have also entered them in that
    expectation.
        Senator Reed. I guess one of the advantages, perhaps, since
    they're parliamentary governments, that the majority party and
    the Prime Minister are very closely aligned, that might be one
    difference, Mr. Green.
        Mr. Green. I would never speak ill of our form of
    government.
        Senator Reed. No, I know. [Laughter.]
        Having had your hand in it. [Laughter.]
        General Obering, two DOD boards were established in 2002 to
    provide oversight over MDA, the Senior Executive Committee and
    the Missile Defense Support Group. Reportedly, they have not
    met for several years, is that correct?
        General Obering. Sir, they were very active when we first
    stood up the MDA in 2002. They had, I think, eight meetings the
    first year, if I'm not mistaken, and things got off to a pretty
    good bang. What we did is we altered that, and we went to a
    direct oversight with the Under Secretary of Defense for
    Acquisition, Technology, and Logistics. The Missile Defense
    Support Group and the Senior Executive Committee have now been
    replaced with the Ballistic Missile Executive Board, and that
    reconstitutes that oversight. It will have standing
    subcommittees that report to that, and that charter was just
    signed here, recently, and we will kick that off with the first
    meeting of that, I think, in the next 3 weeks or so.
        Senator Reed. So, the BMDS Executive Board is just
    beginning now? It hasn't really started, but it will?
        General Obering. Yes, sir.
        Senator Reed. So, essentially, what outside entities beyond
    MDA have been looking over your shoulder, and giving you
    advice?
        General Obering. Sir, you name it. We've had quite a few.
        Senator Reed. Who do you have to listen to?
        General Obering. First of all, we have quarterly execution
    reviews with my boss, directly, the equivalent of a Defense
    Acquisition Board, where we go through all of the programs, we
    go through the performance. We also report, I go to the Joint
    Requirements Oversight Council, I brief up what the incremental
    improvements, the changes in our baseline--we do report changes
    in our baseline, by the way, to the Office of the Secretary of
    Defense (OSD) and to Congress through the SAR activities, and
    we've done that now for the past several years.
        We have been audited, of course, by the GAO, very robustly,
    and now there's a standing--I think it's an annual mandate that
    they have to come in and look at all of our programs----
        Senator Reed. What about the Program Analysis and
    Evaluation (PA&E)?
        General Obering. PA&E were part of the Missile Defense
    Support Group that lasted for a year or so, about 18 months,
    and then they are now part of the standing committee that will
    be part of the Executive Board.
        Senator Reed. Let me change subjects slightly, and that is,
    according to the budget data, the GBIs 21 through 30 were
    incrementally funded over 3 years. Interceptors 31 to 40 were
    incrementally funded over 4 years, and then the GBIs 41 to 50
    were incrementally funded over 5 years. Why are we increasing
    the incremental funding for these interceptors?
        General Obering. Sir, what we do, and Mr. Francis referred
    to it--is we try to adjust the scope of our activities based on
    the realities of what we're faced with. So, in that timeframe
    that you just talked about, we have adjusted to some of the
    realities of the program. If you recall, there was a chemical
    systems division explosion at our plant in San Jose,
    California, that took out one of our entire configurations of
    our GBI boosters, that we had to not only recover in terms of
    finding additional vendors and suppliers for that, but recover
    those boosters' interceptors.
        When we had the two aborts that occurred in December 2004
    and February 2005, as you also probably recall, I stood up an
    Independent Review Team to take a look to make sure that those
    were just technical glitches, that they were not systemic
    problems, et cetera, and we stopped deployment, at that time,
    of the interceptors.
        I also made a decision in the 2003-2004 timeframe that we
    would fund the logistic support costs for these interceptors,
    along with the other things that we produce. The reason is I
    thought it was a proper behavior to generate on the part of
    developers, that they need to pay attention to support costs,
    and if that came out of our budget, it came out of those
    programs, they would have to take that into account. We've also
    done some other things with respect to concurrent test and
    operations, et cetera. So, we added scope in some areas, and we
    had to stretch out scope in other areas to be able to
    accommodate those changes.
        It's part of a flexible portfolio management approach that
    the GAO recommends, and I think some of the things we are going
    to talk with the GAO about are the recommendations that are
    coming out of that particular report, and how they relate to
    some of the recommendations that they have in our report.
        Senator Reed. Thank you, sir.
        Mr. Francis, right now the entire BMD System is considered
    a single major defense acquisition program. Can you give us
    your views on reporting on this very, very large program?
    Benefits? Advantages? Would it be better if there were some
    type of dis-aggregation or some type of more focused approach?
        Mr. Francis. Sure, Senator. We think the advantage of
    managing a system of systems is, it does provide a portfolio,
    which General Obering then can make decisions across program
    lines, so that you don't have each program stove-piped. So, he
    can make decisions to move money to places where they're
    needed. He could also, if he wanted to, meet a threat, he could
    move requirements around to the system best able to do that.
    That's the real advantage of a portfolio like that.
        The disadvantage comes from an oversight perspective,
    because typically the elements within MDA would be individual
    programs that you would have oversight over and be budgeting
    for and reconciling costs with. In a system of systems, you
    lose that granularity, because you don't necessarily see what's
    going on in each system. So that part's difficult; it's true,
    for any system of systems.
        So, it's something--if that's where we're going to go in
    the future, we need to think about oversight mechanisms that
    give us visibility to the elements while providing the
    flexibility to make trades at the system level.
        Senator Reed. From the GAO's perspective, do you feel
    comfortable that you have sufficient access and granularity?
    Details?
        Mr. Francis. Yes, I think we have sufficient access. We do
    have difficulty, if you will, chasing some of the numbers. You
    brought the example up of the incremental funding--that's
    something that is made possible by the whole budget being R&D
    funds, so that you can pay for something over time. In another
    program, you would require procurement funding, so if you were
    going to buy 10 interceptors, for example, all 10 would have to
    be funded in a budget, and then you would track those costs.
        So, what becomes difficult for the accountant, if you will,
    is when costs are tracked over 5 years, you kind of lose the
    audit trail, and then to try to compare actual costs back with
    what was budgeted, we can't go back and reconcile, ``Okay, we
    were going to pay this much for 10 interceptors, we paid this
    much more--why did that happen, and what's the Government's
    recourse?''
        Senator Reed. Thank you, and for the record,
    ``granularity.'' I think. [Laughter.]
        Dr. McQueary, and General Obering, one of the issues that
    is perennial is very realistic operational testing. Where do
    you think we are in terms of that, particularly with the GMD
    system?
        Dr. McQueary?
        Dr. McQueary. As I indicated in my opening remarks, we
    would say that based upon the test that was conducted--I don't
    have all of the numbers properly--but the test that was
    conducted with the interceptor, they have demonstrated a
    capability to intercept a simple foreign threat. So, that does
    not imply that we're finished, or anything at all. But that
    demonstration has been done.
        Senator Reed. So, we're still somewhat removed from
    engaging what likely would be shot at us by a hostile----?
        General Obering. No, sir, I don't agree.
        Senator Reed. Okay.
        General Obering. There's nothing that says that we might
    not be faced with simple threats in the near-term, against the
    rogue nations that we are gearing this system torward. We have
    planned this year to add more and more capability into these
    tests with respect to sensors, like the SBX Radar, the forward-
    based deployed radar, as well, to begin to run some of our
    capabilities to begin to address more complex threats, as well.
    So, we have a path that we have laid out ahead. Sometimes we
    hear, ``Well, if it can't handle very complex countermeasures,
    it's not worth deploying,'' and frankly, we don't agree with
    that. We think that there are many situations where we will not
    be faced with complex countermeasures, and it is worth
    deploying.
        Senator Reed. So, if you were deploying a fighter aircraft,
    you'd feel very comfortable deploying it against the least
    capable threat in the air, saying that it's operational and
    it's good enough?
        General Obering. If it was the most likely threat, sir. If
    you had no defense against that threat, then I think I would be
    inclined to do so.
        Senator Reed. What's your premise of the most likely
    threat? I don't want to belabor this, but one of the issues
    here is, it's a race. To develop the very sophisticated anti-
    missile system that you're trying to do, versus deploying
    things like balloons, and decoys, et cetera. There are some
    that would argue that it's a lot easier to deploy decoys or
    things like that, than it is to knock one of those things down,
    kinetically.
        General Obering. Well, fortunately, because we have had the
    support of Congress, we've been able to get a large step up in
    that race, so to speak. With the fielding of the SBX Radar,
    with the advanced radar algorithms that will be placed in that,
    this year, along with the forward-deployed radar, we have a
    tremendous leg up.
        By the way, countermeasures are not as easy as they are
    being described, sometimes. We have probably the Nation's
    leading countermeasure experts in the MDA, or under contract to
    us. We actually flight test these. We flight test them in front
    of these radars, we understand the characteristics and we
    understand the behavior so that we can program those into the
    radar, so, we're trying to keep up with that very threat.
        Senator Reed. I understand that, sir.
        Thank you.
        Senator Bill Nelson. Senator Sessions?
        Senator Sessions. General Obering, let's just discuss that
    a little bit more. Based on what we understand, for example, on
    the launches that the North Koreans attempted, what can you
    tell us about your expectation of their ability to have complex
    countermeasures or decoys? Is that classified?
        General Obering. Yes, sir. It would be classified. Suffice
    it to say that I believe that my statements stand that we would
    have a capability against those threats.
        Senator Sessions. But there's no difficulty, and in fact,
    it's part of your strategy that while these systems are in
    place now that are capable of defending against, as Dr.
    McQueary said, a simple missile launch, that you will continue
    to make them more sophisticated through R&D.
        General Obering. Yes, sir, as well as fielding. We actually
    have a program, in addition--as I said--to the deployment of
    these algorithms in the radars, we have a program called MKV
    that will allow each one of our interceptors to be able to
    handle what we call ``credible objects''--more than one. So
    that means that we don't have to be precise to understand what
    is the warhead, and what's not. We can actually take out
    everything that's in that particular cluster of a threat sweep.
        Senator Sessions. That assumes that the attacking missile
    has multiple decoys.
        General Obering. Yes, sir. Yes sir, exactly.
        Senator Sessions. But even in that system, I assume you've
    attempted to design it to make sure it does not go after the
    decoys, but hopefully will go for the----?
        General Obering. Yes, sir. We actually go through a staged
    process, a layered process, just like everything else, to try
    to make sure we focus as much as we can on the warheads.
        Senator Sessions. How do you see the status of the MKV
    program? How's that funding, and do we have problems there?
        General Obering. If there was any program that I have that
    I would like to accelerate, it would be that one. In terms of
    being able to move that back to the left. That would require
    additional money, additional funds.
        Senator Sessions. As I was listening, ``move to the
    left''--what does that mean? That makes me nervous. [Laughter.]
        General Obering. Sir, not politically, but scheduling.
        Senator Sessions. Good.
        So, Dr. McQueary, you talked about that the test program
    being robust and disciplined, I believe, and that it has
    limited capability against a simple threat--which I think gives
    us some confidence. General Obering, you used a phrase in your
    opening remarks that a good missile defense system would
    ``devalue'' the assets of the enemy--what do you mean by that?
        General Obering. Sir, if you'll bear with me one second, I
    view missile defense as part of a spectrum that includes
    deterrence, arms control, and missile defense as well. At one
    end you have enemies--countries that can be deterred, and we've
    seen that in our history and it's worked very well. You have
    other nations against whom you can use arms control measures,
    both positive and negative sanctions or incentives, to try to
    get their behavior modified.
        But, I think that as we enter this century and we get into
    it, we understand that we're in a world in which we may face
    organizations, countries, what I call the nation-state
    equivalent of suicide bombers, that are not deterrable and are
    not affected by arms control.
        So, it would be nice to have another option that we can
    provide to the President and the American people to protect
    them. So, as we roll out missile defense capabilities and as
    they become more widely known as being effective, then it
    begins to take away the value of these missiles from countries
    like Iran and North Korea. Because historically we've had no
    deployed defense against them--they view that as a great
    equalizer with the United States or with the West, as being put
    on an even par with us, and therefore they can leverage that
    against our allies and our friends. So, if we say, ``If you
    deploy those weapons or try to use them, they're not going to
    be any good, because we will shoot them down,'' then they have
    to go through the investment decisions, do they want to do
    that, do they want to continue to invest in these weapons? We
    think that if we are able to show an effective missile defense,
    collectively, along with our allies, it begins to devalue those
    weapons in the eyes of some of these countries.
        Senator Sessions. I think that's a good explanation and I
    think maybe other nations that might be thinking on developing
    an offensive missile system would, might add the cost up
    thinking that we--even if they completed and spent hundreds of
    millions, maybe billions of dollars on that, it still wouldn't
    be effective because we have a good system against it.
        General Obering. Yes, sir.
        Senator Sessions. Would that be true also?
        General Obering. Yes, sir.
        Senator Sessions. General Obering, you've been given, as
    Mr. Francis said and as GAO's report discusses, flexibility to
    both deploy and develop at the same time.
        He raised some points about some cost overruns or spending
    above what we've projected. Tell me, in your view, how you
    would evaluate this? First of all, there is value to the United
    States that we have this system in place today.
        General Obering. Yes, sir.
        Senator Sessions. A very great value. But, in terms of the
    actual cost of this program, we've gone faster, sometimes
    faster saves money. Tell me how you would evaluate, honestly,
    for this Congress and the American people who may listen,
    whether or not this flexibility you've been given and the more
    rapid deployment than a lot of systems would allow, has
    impacted the actual cost of the program.
        General Obering. Well Senator, as I said in my opening
    statement, we've come a long way in 30 months since 2004 with
    the flexibility that we've been given. We've been able to
    rapidly develop and field and deploy these capabilities.
        If we look aggregately at what we have done from a block-
    cost perspective, we are roughly 4 percent or less for Block
    2004 or Block 2006, in terms of what we anticipated the cost of
    the block to be. As Mr. Francis referred to, in some cases we
    had to defer content, and I'll give you a couple of examples,
    but then we catch back up.
        So for example, as a result of the activities in the 2004-
    2005 timeframe, we lost six of the GBIs in the explosion that I
    talked about in California. I also redirected four GBIs as a
    result of the launch aborts back in December 2004 or February
    2005 as well, into our ground test program, that were going to
    go in to be deployable.
        We have now been able to catch back up to where--way back
    in 2002, we had anticipated that we would have 30 GBIs in the
    silo by the end of this year. We will now have 24, as opposed
    to the 30, and those are the 6 that we lost in the explosion.
    We should be able to catch back up with the original target for
    Block 2008, based on the funding profile that we've been given
    and how we're managing the program.
        Again, a lot of the flexibility we've been given also
    allows us to do things like the savings that we took from the
    GMD program. We discovered that we had some overhead
    infrastructure that we no longer needed in the program. We were
    able to reduce that and turn that money into GBIs to help us
    catch that up again.
        Senator Sessions. To follow up, even if we had the
    traditional procurement system, even, that I think Mr. Francis
    will agree, when we've had that, we've had cost overruns,
    sometimes far more than this. So, I don't know that because
    there's some cost overrun, indicates that the program, this new
    technique is less effective in managing the money. I see some
    potential, as you've indicated, that it's allowed us to deploy
    much sooner, and even save some money, and delay costs money.
    The longer these programs stretch out and all this money that
    goes in sustaining it and maintaining it before you even get
    the system there, to me is a cost that's often not properly
    counted.
        Is that fair to say Mr. Francis?
        Mr. Francis. I think so, Senator. I guess what I would
    bring up is, right now I think Block 2006, by our calculations,
    is about $1 billion over what it was expected. We've reported
    another $478 million in 2006 contract overruns that may defer
    additional work.
        Now, I haven't done the calculation on the percents, but
    even if it were 4 percent, when we talk about regular weapons
    systems and we say, ``Gee, they're 30, 40 percent over cost.''
    That's generally over the life of the program, a 10-year
    program. So, 4 percent annually sounds like a small amount, but
    if we're going to do it for 10 years, it's a big number when
    you get out there.
        The question I would ask is, is there a way to get the best
    of both systems? In other words, can we preserve the
    flexibility and not change how General Obering makes decisions,
    but provide more visibility on the cost consequences of the
    decisions he does make?
        Senator Sessions. Presumably, you think the answer is yes?
        Mr. Francis. I think so, yes.
        General Obering. Yes, sir----
        Senator Sessions. Briefly, as my time----
        General Obering. Yes, sir----
        Senator Sessions. Briefly, if you want to respond.
        General Obering. Just that the numbers that Mr. Francis
    quoted, they are over more than just a 1-year period. They're
    longer than that, with respect to that.
        If you look at the individual program performance, we're
    doing very well. For most of our programs we're down, below 10
    percent for the total contract value of 8- to 10-year contracts
    with these programs. The only one that we have exception with
    the GAO on is our STSS. We have a factual disagreement on some
    assumptions that were made by the GAO, and that's okay. I think
    we're going to work through that. That's not a big issue. When
    you take that out of the equation, we're down below 10 percent
    for our program performance for the life of the contracts,
    including the GMD program. It would be running around 12
    percent as part of that average.
        So, I think this program, and I think GAO--I don't want to
    put words in their mouth, but I think they see the value in
    this in some of their other recommendations on how they do
    portfolio management. Now, what we have to do is take a real-
    life portfolio management example that we have had now for the
    past several years, compare that to what the GAO is
    recommending for the future of the Department, and see if
    there's a marriage that we can make there that would make
    sense.
        Senator Sessions. Thank you.
        Mr. Chairman?
        Senator Bill Nelson. Mr. Francis, your report recommends a
    number of changes in the acquisition approach, including the
    use of procurement funds for buying operational assets. Would
    you discuss how you would recommend such changes be
    implemented?
        Mr. Francis. Yes, Mr. Chairman. We think that right now,
    the way the budget is requested is through elements but the way
    we account in MDA is through blocks. So, we think the starting
    point would be by program element. You would baseline an
    element using a knowledge-based approach--which I could
    discuss, but then having laid out that element that way--and by
    the way, this is how that report that we have on portfolios
    deals with that. When you're managing a system of systems, you
    do know the total cost of every system in there, and it does
    have a business case.
        So, we think the elements need to be baselined for cost,
    schedule, and performance. Then those that are considered far
    enough along to be in system development and demonstration, you
    would then track those costs, just like you would a regular
    program. You would use procurement funding for those assets
    that are going to be operational assets. I think we would
    expand that to operations and support as well.
        That does a couple of things for you. One is, it does give
    you control over the procurement funding and you can then fully
    fund your assets in 1 year, which provides visibility to you.
    It does provide some better contracting opportunities for the
    Government because R&D contracts are, by definition, best
    effort contracts where the Government does bear a fair amount
    of the risk.
        We also think that you could--and the way we wrote our
    recommendation was that--to have DOD propose a way to do this.
    Because one of the downsides is, if you did put those elements
    into system development and demonstration, and baseline them,
    and subject them to the laws that apply to other systems if you
    have a cost increase that breaches a certain threshold, then
    DOD has to come back and certify to you that things are okay
    before they can proceed, which could slow decisionmaking.
        So, some of the things that we're thinking about is, you
    could have those triggers in place to say, ``Hey, we have a
    cost increase.'' But, the requirement might only be that MDA
    inform Congress, rather than have to stop and recertify.
        Senator Bill Nelson. Would you work with our staff to try
    to implement those changes?
        Mr. Francis. Yes, sir.
        Senator Bill Nelson. General Obering, in your prepared
    testimony, you place emphasis on proceeding with the proposed
    deployment in Europe of 10 GBIs and associated radars. That
    proposal is one of two options included in the budget request
    submitted to Congress.
        The budget request seeks funds to install 10 Interceptors
    at a third missile site--either at Fort Greely, Alaska, or in
    Europe. The budget request overview states that the U.S. is
    entering into more detailed discussions with Poland and the
    Czech Republic in 2007 regarding the possible basing of missile
    defenses in their countries.
        So, as I understand it, your budget request to us is that
    there are two options for the planned deployment of 10
    additional Interceptors--one at Fort Greely and one in Europe.
    Is that correct?
        General Obering. Sir, what that was meant to do was to try
    to address this idea of risk management and timing. That is, if
    Congress were to appropriate money for us to buy the GBIs, as
    part of this package, the long-lead items, the initial items
    that we need for that. If there were to be hiccups or stumbling
    blocks in the ongoing negotiations and in the movement for the
    third site, that would not be wasted money. We could use those
    GBIs in the Fort Greely situation.
        But, it does not provide additional coverage, if we were to
    do that, for all the reasons we stated before to our European
    allies or our deployed forces in Europe, nor does it provide
    redundant coverage of the United States because we would have
    to put them back in Fort Greely, Alaska.
        Senator Bill Nelson. Your proposal is you want them in
    Europe?
        General Obering. Yes, sir.
        Senator Bill Nelson. Then why would you propose to put them
    in Fort Greely?
        General Obering. I think we were answering a concern if we
    were to receive the long-lead money for these GBIs and things
    did not work out with the European site, would that be money
    that we could not use.
        Senator Bill Nelson. Is it correct that no final decisions
    have been made with regard to the possible basing of missile
    defenses in Europe?
        General Obering. I think that Mr. Green mentioned that
    earlier, Senator. We haven't got a final agreement, per se, but
    we are well on a track to reach an agreement, I believe with
    both the Poles and the Czechs.
        Senator Bill Nelson. Okay, so if there is no decision by
    those governments, or an agreement is not reached to deploy the
    10 GBIs in Europe, then you have the preplanned option of
    deploying them at Fort Greely. Is that correct?
        General Obering. We would then divert those, if need be.
        Senator Bill Nelson. So, the answer to that is yes.
        General Obering. Yes, sir.
        Mr. Green. Again, Senator, we entered into these
    negotiations with a very high expectation of success, as did
    the Government of Poland and the Government of the Czech
    Republic.
        Senator Bill Nelson. Do you have an indication, Mr. Green,
    that you have the approval of NATO?
        Mr. Green. Well, approval is an interesting word. The first
    point I would make is that we are going into this activity with
    a very, very strong NATO context. It's a programmatic context,
    a NATO technical and operational context, and a political
    context.
        There are a number of NATO nations that are currently
    engaged in missile defense activities. Five NATO nations,
    including the United States, are engaged in long-range missile
    defense activities. A number of others are heavily engaged in
    the development and deployment of short-range and medium-range
    missile defenses.
        In terms of the technical operational aspects of this, the
    activity that we're involved in now, the potential deployment
    of long-range missile defenses in Europe will defend against a
    long- or intermediate-range threat to our European allies. That
    leaves the southern tier of Europe, so to speak, which is not
    subject to that long-range missile threat, but is subject to a
    short- and medium-range threat. They will need defenses of that
    sort and that's the kind of defense that European nations are
    working on.
        There's a natural complementarity between what we're doing
    and what NATO is doing. I mean, we would certainly expect as
    NATO fills out those short- and medium-range defenses that
    would be compatible with, complementary to--our long-range
    defenses.
        Senator Bill Nelson. Is it----
        Mr. Green. In terms of political interaction we have also
    pursued very robust consultations with NATO and we are
    continuing to do that. We've consulted with them multiple
    times. We're going over again next week. We've had multiple
    trips over to the Capitals to consult in a bilateral sense and
    we're continuing that effort.
        Senator Bill Nelson. Is it the administration's position
    that you would proceed on this if you got Poland's and the
    Czech Republic's approval, but not NATO's approval?
        Mr. Green. We are pursuing bilateral negotiations with the
    Czech Government and the Polish Government. We certainly
    recognize the value of NATO in this context and we're
    continuing to work with NATO, but it is a bilateral negotiation
    between the Czech Government and the U.S., and the Polish
    Government and the United States.
        Senator Bill Nelson. So, the answer is yes. You would
    proceed if you got the country's agreements, but not NATO's
    agreement.
        Mr. Green. Again, there is, there are, I guess nuances here
    of approval and agreement. There is no legal requirement for
    approval by NATO, but we're obviously very interested in making
    sure that NATO allies understand the benefits of this system,
    how it operates, what it does, how it benefits the NATO
    Alliance, and I think, increasingly, we're getting an
    understanding from NATO nations about the nature of the threat
    that's posed and how this system would help defend against
    those threats, and increasing acceptance that this system is
    designed against those threats and will be effective.
        Senator Bill Nelson. I'm just trying to find out, do you
    intend to seek NATO's approval or not?
        Mr. Green. If by approval, you mean turning this into a
    NATO-funded effort----
        [Disruption in the audience.]
        Senator Bill Nelson. The committee will, and I'm----
        Ma'am, I'm the one that got you a seat. [Laughter.]
        Mr. Green. Senator, I honestly am trying to answer your
    question.
        If by approval you mean turning this into a NATO-funded
    effort, a NATO effort to develop and deploy long-range missile
    defenses, that is not our intent. We have developed the system
    and we're entering into those bilateral negotiations with the
    Czechs and the Poles.
        But again at the same time, I would emphasize that this is
    a very strong NATO context, and we are certainly very
    interested in trying to make sure that all of our allies are
    accepting and approving, though not through a formal approval
    process. Most NATO capabilities are not developed by NATO.
    Almost all NATO capabilities are developed by individual
    nations or groups of nations within NATO.
        Senator Bill Nelson. Mr. Green, what would happen if you
    got the approval of one of those countries, but not both?
        Mr. Green. Well again, we certainly anticipate the approval
    by both. We have not speculated about what would happen if we
    got approval from one and not from the other and we don't
    anticipate that circumstance to arise.
        Senator Bill Nelson. General Obering, let's talk about the
    missile--or to be technically correct--the rocket that you want
    to put in Europe. It's a two-stage variant of the three-stage
    GBI, which is the one that's in Alaska and California. Are you
    in the process of developing this new rocket?
        General Obering. Yes, sir. It's not a new rocket, Senator,
    it's a different configuration of what we currently have. It
    allows us to maximize what we call the battle-space there, in
    terms of being able to get into a kill vehicle mode quickly.
    That's the advantage of it. It is not a significant change in
    terms of the things that you have to do to make that work. We
    have actually used this technique in other programs within the
    BMDS.
        Senator Bill Nelson. There are different things that you
    have to do.
        General Obering. Yes, sir, there are. We have that on
    contract.
        Senator Bill Nelson. Repackaging the booster avionics?
        General Obering. Yes, sir.
        Senator Bill Nelson. The shrouding venting has to be
    modified?
        General Obering. Yes, sir.
        Senator Bill Nelson. The guidance and control software has
    to be updated?
        General Obering. Right.
        Senator Bill Nelson. You're going to operate in a new
    flight environment?
        General Obering. That will be tested. Yes, sir.
        Senator Bill Nelson. You have to upgrade to provide nuclear
    hardening?
        General Obering. That is something that we're going to do.
    In fact, that is something that we're doing overall for the
    fleet.
        Senator Bill Nelson. You have to improve ability to execute
    the full fly-out maneuvers?
        General Obering. Yes, sir. Actually, we already have those
    programs in the three-stage maneuver, the three-stage version
    as well. We have those capabilities.
        Senator Bill Nelson. Do you have a schedule acceleration?
        General Obering. I don't know what you mean by a schedule
    acceleration, but it is part of what we have put on contract.
        Senator Bill Nelson. Now, isn't that part of developing a
    new system?
        General Obering. Again sir, it's part of what we consider
    to be a different configuration of what we have. So, there are
    new capabilities, but we are always looking at and developing
    new techniques for these interceptors. Frankly, that's one
    reason why we prefer the R&D test and evaluation money, that
    allows us that flexibility to be able to do that.
        Senator Bill Nelson. Do you plan to test it?
        General Obering. Yes, sir, in 2010.
        Senator Bill Nelson. So, you want us to authorize and
    appropriate funds to deploy this interceptor that would be
    tested in the future, as it's not yet been put together in the
    development package.
        General Obering. It goes back to what I've said previously.
    We are managing risk, we're not trying to avoid it. We don't
    consider what you described to be very high-risk items based on
    what we know now of the GBI, the booster, the fly-outs. We
    believe that the longer items that are going to have to take
    place are the site preparation, the site clearing, the
    construction activities etc. So, we are pursuing those
    concurrently and in parallel.
        Senator Bill Nelson. Let's go back to my earlier question.
    Suppose you decided you were not going to deploy them in
    Europe, these 10 GBIs, you were going to deploy them at Fort
    Greely. Would you deploy more of the three-stage GBIs, or would
    you use the newly developed two-stage GBI?
        General Obering. It depends on what we would like to do at
    that time with respect to Fort Greely and what capability the
    warfighters may want to have. So, I would defer that decision
    until that time, until we can think through that. But clearly,
    we could add the third-stage back like we have with the ones
    that we currently have in the ground in Alaska and California.
        Senator Bill Nelson. Dr. McQueary, you're the man who is
    the Director of Operational Test and Evaluation. Would you have
    high confidence that a missile, such has been described--that
    is, as General Obering has said, is being developed and not
    been tested--would perform as operationally effective,
    reliable?
        Dr. McQueary. I think this is an area in which the DOT&E
    organization needs to have further discussion with General
    Obering. I will react in the following way though--he is taking
    an approach that I believe is a lower risk approach, by using
    proven components in order to be able to build this new rocket.
    So, that gets the technology readiness issue, which I think is
    very important.
        But, I do think we need further discussions on what kind of
    testing needs to be done in order to satisfy us from an
    independent operational test evaluation standpoint, what would
    need to be done with that.
        Senator Bill Nelson. Well, you have to advise us----
        Dr. McQueary. Yes, sir.
        Senator Bill Nelson. --because we're in the----
        Dr. McQueary. I agree.
        Senator Bill Nelson. --position of, the question is, do we
    authorize this, and do we fund it?
        Dr. McQueary. Well, I think the issue is, it's, with the
    funding approach that MDA has, and I'm in an area in which I'm
    not the expert, so please bear with me. By using R&D funds,
    such as has been done, that this approach is not inconsistent
    with what has been done in other areas.
        Senator Bill Nelson. So, when are you going to have an
    answer to that question?
        Dr. McQueary. Well, this is a relatively new program. We
    are aware what the plans are and I have people in our
    organization who have had discussions with MDA. But I can't
    offer an answer to your question directly. I'll certainly be
    happy to provide you an answer, if I may, for the record.
        [The information referred to follows:]

        There are added risks anytime a system's working design is changed.
    In the case of the two-stage variant of the ground-based interceptor
    (GBI), I agree with the Missile Defense Agency's (MDA) seven
    developmental risk areas. I believe the most significant risk is with
    the software changes and integration that MDA must make not only in the
    interceptor, but also in the Command and Launch Equipment and the
    Ground-Based Midcourse Defense Fire Control to optimize the
    interceptor's new performance envelope. There is commonality between
    the two-stage and three-stage variants of the GBI booster. MDA gained
    experience when it converted a three-stage Minuteman II into a two-
    stage Minuteman II. However, I cannot make an assessment on
    effectiveness, reliability, or suitability on a two-stage design that
    has not yet been built or tested. Through MDA's Integrated Master Test
    Plan, I will approve the combined developmental/operational flight
    testing of the two-stage interceptor, and my office and the joint
    operational test team will participate in all aspects of this testing.

        Senator Bill Nelson. Will that come soon? Because we're
    talking about a markup in a few weeks.
        Dr. McQueary. I don't know whether we can do--we certainly
    will not have the data with which to be able to say whether we
    think the new system will be effective and suitable because the
    data would simply not be there.
        We can advise you as to whether we think the approach that
    the MDA is proposing to take, or is taking would likely result
    in a satisfactory solution if it is properly implemented. We
    could certainly do that.
        Senator Bill Nelson. Can you provide that in a few weeks,
    before the markup?
        Dr. McQueary. Yes sir, we can do that.
        Senator Bill Nelson. Okay.
        Senator Thune, I still have some more, and I see you are
    back here. So, go ahead and ask your questions and then I'll
    finish up.
        Senator Thune. Okay. Well, thank you, Mr. Chairman.
        Gentlemen, thank you for appearing before the subcommittee
    today.
        Missile defense is an issue of increasing importance for
    our strategic requirements. North Korean and Iranian missile
    programs are clear evidence of both the advancement and
    proliferation of missile technology. Furthermore, increases in
    Russian and Chinese military capabilities are also a matter of
    concern. China's successful ASAT test and Russia's boast to
    overwhelm our defenses are indicators that we should not take
    lightly. I believe we must be committed to missile defense to
    ensure that our security and the security of our allies is not
    taken for granted.
        General Obering, I want to ask you a question about the
    Airborne Laser (ABL) program. It's, in my view, critical to our
    ability to shoot down enemy ballistic missiles during the boost
    phase. The capability to overcome missile defense
    countermeasures like multiple decoy warheads is one of the many
    reasons that I believe the importance of the ABL cannot be
    overstated. I guess the question I have is, could you describe
    what testing is ongoing for the ABL and what are the prospects
    of this system for the future?
        General Obering. Yes, sir. I'd be happy to. First of all, I
    would like to recycle back about 2\1/2\ years, very briefly.
    The ABL, we believe, got on the right path in December 2004
    when they were able to demonstrate that they could fire that
    high-energy laser in a 747 mock-up at Edwards Air Force Base.
    They were able to achieve the synchronization and we actually
    fired that laser over 70 times since that initial firing in
    November 2004.
        We also flew the heavily modified 747 in December 2004. We
    demonstrated, first of all, the airworthiness of the aircraft,
    and we demonstrated the initial checkout of the optical train
    with respect to jitter control and that type of thing onboard
    the aircraft.
        Since that time we've made significant progress. In fact,
    there are actually three lasers that go on the aircraft. There
    is a tracking laser that we use to precisely track an enemy
    missile. There's an atmospheric compensation laser that then
    goes out and measures the distortion in the atmosphere, and
    feeds that information back to the fire control system. Then
    there's the high-energy laser that actually shoots down the
    boosting missile.
        As we sit here today, we have the tracking laser and the
    atmospheric compensation laser loaded on the aircraft and we
    have a surrogate of the high-energy laser on there. We went
    into flight testing several weeks ago and, in fact, we will be
    going back up tonight. We attempted to do a full-blown test of
    the tracking and the beam illumination laser last night. We
    will try again tonight. We ran into problems that had nothing
    to do with the aircraft. It was just a range availability kind
    of thing. So I'm very pleased with the progress that they've
    been making so far.
        We have some key knowledge points coming up. We do use
    knowledge points in all of our development programs, and the
    ABL has to demonstrate that it can actually track a target, it
    can actually close a fire control solution, it has to be able
    to compensate for the atmosphere by firing that beam
    illumination laser and then compensating with the surrogate
    high-energy laser, all against a flying target, which is what
    we're doing right now. So, we should gain some significant
    knowledge in the next several weeks with that program.
        Senator Thune. With those knowledge points coming in and
    the scheduled shoot-down for 2009, why has the MDA removed over
    the past 3 years $1.1 billion in funding from the program, if
    it shows as much promise as you suggest today?
        General Obering. First of all, we are constantly being
    aware of what money we need when, to do what. That is the best
    way I can describe it. When the ABL--even though they have made
    steady progress, it has taken longer than we anticipated in
    some cases--and there were things planned that we could defer
    or move out. We did that to take advantage--it gets back to the
    tradeoffs that Mr. Francis talked about, what we are eligible
    to do. Also, we had to get under some of our budget reductions
    overall for the entire program.
        We've taken significant budget reductions going back to the
    President's budget of 2004, where what we had planned to do, in
    terms of our work, was not what we were funded to do. We had to
    go back and readjust that work. So, that's part of that
    calculation.
        Senator Thune. In the layered missile defense scheme,
    besides the ABL, are there any other stand-alone platforms that
    don't need to rely on satellites for tracking enemy missiles?
        General Obering. Well sir, it depends on what kind of
    defended area you're talking about, and, it depends on what the
    situation is. But, for example, the Aegis weapon system can
    detect and track and engage threat missiles. We do the same
    thing--the ABL has that autonomous capability, and THAAD does,
    as well, for that matter. What we like to do though, is while
    we can rely on that if we have to, we like to be able to extend
    that capability. So, by being able to cue the ABL from an off-
    board sensor, satellite, or a ground-based radar for that
    matter, depending on the scenario, we can greatly expand its
    capabilities. The same thing is true with THAAD, with Aegis,
    and with all of our capabilities, including the GMD program.
        Senator Thune. I share a concern that's echoed I guess, by
    some of my colleagues, concerning funding levels for missile
    defense. I guess a follow-up question is: if we continue or
    reduce funding for missile defense, are we going to push these
    advancements further out into the future, and are we creating a
    gap in our defenses because we are starving missile defense?
        General Obering. If we continue to push the options for the
    future, and ABL is included in that category, along with KEI
    and others, then as I said in the opening statement, it makes
    us susceptible to the future in terms of what the threats may
    be, and what we may be faced with.
        To give you an analogy, if we had been overly focused on
    near-term capabilities back in the mid-1990s, and we had only
    looked at what we could push out the door in the next several
    years, we probably would only have, by the turn of the decade,
    we would probably only have Patriot, maybe some THAAD
    capability, and maybe some sea-based interceptor capability,
    but probably not necessarily the SM-3. We would have had no
    system to turn on last summer when the North Koreans executed
    those missile launches.
        So, we always have to keep in mind this balance between
    what we are doing today, and getting out the door, and what we
    need to be paying attention to for the future.
        Senator Thune. Thank you, I appreciate your answers.
    Actually, Mr. Chairman, I do have one question I'd like to
    submit for the record.
        Senator Bill Nelson. Okay.
        Senator Thune. If that's okay.
        Senator Bill Nelson. Certainly.
        Senator Thune. Thanks.
        Senator Bill Nelson. You mentioned ABL. It's currently
    projected to cost $5 billion for the R&D through fiscal year
    2009. Last year, there were additional delays, and the planned
    shoot-down flight test was delayed from 2008 to 2009.
        If the technology does seem to work or prove to work, could
    this be an unaffordable system?
        General Obering. Part of our knowledge points are to
    include affordability information, Senator. While we did have
    some delays in the program over the past year, based on some of
    the hard technical issues they're challenging--and they're
    tackling those challenges--we did slip the program about 6
    months, it was December 2008 to about mid-2009 right now. When
    we come to our shoot-down in 2009, we look at all of the
    factors that go into that, and affordability is certainly one
    of those.
        Senator Bill Nelson. So, the question of affordability
    would be held out there in the future?
        General Obering. Yes, sir.
        Senator Bill Nelson. On deploying such a system as that?
        General Obering. Yes, sir.
        Senator Bill Nelson. Dr. McQueary's testimony indicates
    that your MDA is acting on all of their recommendations. It
    also indicates that there are 15 new DOT&E recommendations
    under consideration.
        Do you know of any reason why you would not act on all of
    those 15 recommendations?
        General Obering. Senator, the short answer to that is no, I
    don't see any reason why not. In terms of working together with
    Dr. McQueary, we've been establishing a strong partnership
    already in that regard. It doesn't mean that we agree all the
    time, it does mean that we are breaking new ground here with
    respect to how we move forward, and not think in that vein. I'd
    be very positive in that regard.
        Senator Bill Nelson. Dr. McQueary, the THAAD flight test
    program was reduced by three flight tests for budgetary
    reasons. Now, the program is apparently going to try to
    accomplish all of the objectives of those three tests by adding
    them to other tests, and add a number of critical factors,
    issues, for each of those tests. Then it increases for each
    test. Do you believe that removing those tests adds risk to the
    program? Or, does it reduce the risk if those three tests
    should be conducted?
        Dr. McQueary. That's a very complex question, but let me
    try to keep my answer as simple as I can.
        We have examined the test program for THAAD in detail, and
    of course they had a successful--or what appears to be--a
    successful test last week, making it five out of five tests
    conducted most recently. It is our view that the testing
    program as laid out, with the reduction in the missiles, is
    adequate to prove out the operation of THAAD. With the
    following ``however''--if there were to be a failure, then it
    means we'd have to go back and re-examine the test program to
    see whether we have learned the things that are necessary.
        So, there is some increased risk should there be a failure.
    If the success of the program continues as we have seen in the
    last five, then we believe there would be adequate collection
    of information in order to be able to demonstrate that that
    system does work.
        Senator Bill Nelson. In the testing, a lot of models and
    simulations are used to predict the performance of the system.
    Have there been instances that you know of where the models of
    the GMD program--or other programs--did not correctly predict
    the performance of the system?
        Dr. McQueary. I do not know the answer to that question,
    directly. If I may put a slightly different turn to the
    question on modeling and simulation, I believe very strongly
    that good modeling and simulation is an essential part of this
    program, because the battlespace in which the system has to
    operate is very large and multi-faceted.
        In my judgment, the country will not be able to afford to
    test every single possibility as to what one would do. The way
    one develops high confidence, and the way such a complex system
    as this would operate, would be to develop good modeling and
    simulation, use the testing that is done to prove that modeling
    and simulation does accurately represent what happens. I
    believe General Obering is on a path that will let us do that.
        We do not have a ``BMDS'' model at this point in time that
    we can point to and say, ``Let's exercise this'' to do what
    I've described. But MDA does have a program to try to get us to
    the point where we can do what I've described, because I don't
    know of any other way to be able to gain high confidence that
    the system will work because the testing is quite expensive, as
    we all know.
        Senator Bill Nelson. So, the ideal is to model and test,
    and then flight test.
        Dr. McQueary. Yes, sir. In fact, I'm a believer that you
    should use your modeling to predict what is going to happen in
    a test, in advance, and then measure how that actually comes
    out in the real test. Because that's an important way of
    helping to determine that the model itself is indeed a valid
    model for what is happening.
        Senator Bill Nelson. So, if there was a problem in the
    modeling and the simulation, you'd find it out when you did the
    flight test?
        Dr. McQueary. That's right. These two things need to go
    hand-in-glove, if you will, in order to provide an effective
    set of data and information that can be used in judging the
    efficacy of the system.
        Mr. Francis. Mr. Chairman, if you go back in history and
    look at the THAAD program, before it became part of missile
    defense, that was, in fact, the case--there was modeling and
    simulation to predict its performance, and it's been a while,
    but there were probably seven, eight, or nine flight tests
    before they could use the flight test data to correct the
    model. So, it takes quite a bit of time before the model is a
    good predictor, if you will.
        Senator Bill Nelson. In your opinion--and that was with
    regard to THAAD----
        Mr. Francis. Yes.
        Senator Bill Nelson. In your opinion, with regard to the
    GMD system--where are we there?
        Mr. Francis. I think right now we haven't had enough of the
    data to say we know the model works. I know MDA is working on a
    more sophisticated model. So I would say that, in terms of
    confidence level, the jury is still out on that.
        General Obering. Sir, if I could add to that, Senator?
        It's good to be precise here. We have models of the way the
    interceptor will perform, the way the radars will perform, the
    fire-control system will perform, that we predict. I will say--
    and we'd have to go into a more detailed session, obviously--
    that we get very good correlation between what the anticipated
    performance of that is, and what we see in our flight testing.
    Where we have disconnects with what the models predicted, and
    what actually happened in the flight test, is sometimes where
    you have a failure.
        For example, we never modeled that the interceptor wasn't
    going to fly out of the silo at Kwajalein back in December
    2004. When you have component failure like that, then that's
    not an indicator that you have a bad model, that just means
    that you had a component failure, you had a reliability problem
    that you had to go back and address. So, we see very good
    correlation with what we predict to be the performance in the
    flight, as well as the testing that we've done on the ground,
    as well.
        So, the challenge now, and we're working with Dr.
    McQueary's folks, is to take those very user-unfriendly
    engineering models, that are very accurate and high-fidelity,
    and transform those into models that the operational test
    community can use, models that are much more user-friendly, and
    represent that level of fidelity that they need to do their
    job. That's what we're committed to do.
        Senator Bill Nelson. For both of the Generals here, General
    Cartwright was here a few weeks ago, and he told us it's ``very
    important'' to him to expand our missile defense system
    ``beyond long-range intercontinental ballistic missiles to
    start to address those that hold at threat our forward-deployed
    forces, our allies, and our friends.'' Continuing the quote,
    ``those are more in the short- and medium-range ballistic
    missiles, things such as the Patriot, the Standard Missile-2
    and Standard Missile-3 will be able to address, and THAAD as it
    comes on.''
        Do you all agree with General Cartwright? He's your boss.
    [Laughter.]
        General Campbell. He's not here, though. [Laughter.]
        I do agree with him. I mean, specifically, I can cite an
    example with the Patriot system. Today the Army has committed
    to building an additional two Patriot battalions to address
    specifically the problem that you've described. The work that
    MDA's doing to add the SM-3 missiles, and bring on four THAAD
    fire units, instead of two, recognizes that we know that
    there's a gap in that particular regime. So, I agree
    wholeheartedly with his assessment, we need to move in that
    direction.
        General Obering. Yes, sir, and in fact, it was General
    Cartwright's input and the combatant commander's input that we
    move forward on the THAAD program, adding more fire units, as
    General Campbell said, also adding, I think, about 48 more of
    the SM-3 sea-based interceptors to the program, being able to
    also add a sea-based terminal capability that also is geared
    toward the protection of deployed forces and embarkation
    points, that type of thing. So, we are paying very close
    attention to that.
        Senator Bill Nelson. Well, we're planning a total of 96
    THAAD missiles, and about 140 SM-3 interceptors. Do you think
    that protecting our forward-deployed forces and meeting the
    combatant commanders operational requirements will require more
    of those systems than currently planned?
        General Campbell. We've done some study to a Joint
    Capabilities Mix, this is an initial look, but that study would
    tell us that we should nearly double the quantities of both SM-
    3 and the THAAD.
        Senator Bill Nelson. The number three unfunded priority of
    the Army Chief of Staff is the PAC-3 Pure Fleet Initiative,
    General Campbell. This would upgrade all of the Patriot
    battalions to the latest and most capable PAC-3 configuration.
    The Army is working on finding funds to start that process.
    But, we're going to have to find more funds to complete it.
        Can you tell us what kind of capability this Pure Fleet
    Initiative will provide, and give us your opinion if it is the
    cost-effective way to improve our regional missile defense
    capabilities?
        General Campbell. To address the first part of that
    question, I do think this is the right approach to continue to
    buy more of the PAC-3 system. The capabilities it will bring
    will be increased lethality against the targets we expect to
    face, and those that carry weapons of mass destruction, we'll
    be able to address those targets at longer ranges, and higher
    altitudes. We'll be able to protect more ground area, so you
    basically expand the capability of the system by having that
    PAC-3 configuration.
        So, in my view, it is a proven system. We've used it now in
    two wars, and it would be a prudent way to go forward into the
    future, with a proven system, and a proven PAC-3 capability
    that we have right now in the battalions that we have
    configured to PAC-3.
        Senator Bill Nelson. So, if funds were made available to
    support this system, you would support its implementation for
    the Pure Fleet Initiative?
        General Campbell. Absolutely, and the Army is committed to
    doing that. They're looking at a reprogramming action right now
    for this fiscal year which is up at OSD for their
    consideration, and we're looking ahead to next year to look at
    Grow the Army funding, to support the additional funds we'll
    need to complete the Pure Fleeting of 13 battalions.
        Senator Bill Nelson. Does any of the staff have any
    questions? [No response.]
        Thank you all, you've been very kind, very patient. Thank
    you for the quality of your testimony. The hearing is
    adjourned.
        [Questions for the record with answers supplied follow:]
                   Questions Submitted by Senator Bill Nelson

               FORWARD-BASED X-BAND TRANSPORTABLE EUROPEAN OPTION

        1. Senator Bill Nelson. General Obering, if a decision were made to
    not deploy the 10 interceptors in Poland and the midcourse
    discrimination radar in the Czech Republic, would it still make sense
    to deploy a Forward-Based X-band Transportable (FBX-T) radar--or more
    than one--to Europe?
        General Obering. Yes, an AN/TPY-2 (formally known as the FBX-T)
    located within 1,000 kilometers of the threat launch points, would
    provide early tracking of an Iranian threat and would provide
    additional capability against potential countermeasures. The addition
    of another radar (e.g., the European Midcourse Radar) in Europe
    improves continuous tracking of the threat complex for trajectories
    into U.S. and Europe.
        The AN/TPY-2 and the European Midcourse Radar combined with the
    interceptors at Fort Greely and Vandenberg Air Force Base (AFB)
    provides more confidence and performance margin in the defense of the
    U.S. and will allow for protection of the Thule Radar against stressing
    threat trajectories.
        However, Europe cannot defend against intermediate-range ballistic
    missile (IRBM)/intercontinental ballistic missile (ICBM) threats
    without a European interceptor site (EIS).

                    COMPARATIVE COSTS OF THIRD SITE OPTIONS

        2. Senator Bill Nelson. General Obering, given that there are two
    options for the planned deployment of the final 10 Ground-Based
    Interceptors (GBIs)--either at Fort Greely, or in Europe--presumably
    Missile Defense Agency (MDA) has analyzed the comparative cost of those
    two options. An MDA budget chart indicates the cost of the proposed
    European deployment of interceptors and radars would be over $4 billion
    through fiscal year 2013. How much would it cost to deploy the 10
    additional missiles at Fort Greely?
        General Obering. The Department's plan is to deploy GBIs 45-54 at
    the EIS and MDA's fiscal year 2008 President's budget request includes
    resources that support this plan.
        It would be possible to deploy these interceptors at Fort Greely
    and the cost difference would be $1,461 million less than deploying
    them at the EIS. The total cost of the EIS site is $2,298 million which
    includes: $442 million to procure the 10 interceptors; $617 million for
    silos, launch support equipment and interceptor emplacement; $1,011
    million for construction activities of the missile field, mission and
    supporting facilities; $130 million for interceptor and satellite
    communications systems; and $98 million for noninfrastructure security.
    The total cost of deploying the 10 interceptors to Fort Greely is $837
    million which includes: $442 million to procure the 10 interceptors;
    and $395 million to provide a missile field in which to emplace them
    (including a Mechanical Electrical Building, 10 sets of silos and
    launch support equipment and all software upgrades needed to the Fire
    Control and Command Launch Equipment to support the 2-stage GBIs).
    Therefore, the cost of deploying these 10 interceptors at Fort Greely
    would be $2,298 million^$837 million = $1,461 million less than
    deploying them at the EIS.
        However, while the emplacement of these 10 GBIs at Fort Greely
    would cost less, these interceptors would not provide the same
    defensive capability from this location as compared to the European
    site. The purpose of emplacing 10 GBIs at the European site is to
    enhance protection of the U.S homeland from emerging long range Middle
    Eastern threats, as well as extend missile defense coverage to our
    friends, allies and deployed forces in Europe from intermediate range
    Middle Eastern threats. This defensive capability could not be
    accomplished by emplacing these 10 GBIs at Fort Greely.

                           COVERAGE OF PLANNED SYSTEM

        3. Senator Bill Nelson. General Obering, the North Atlantic Treaty
    Organization (NATO) Secretary General referred to different classes of
    NATO countries based on differing defensive coverage. Is it correct
    that the planned deployment of 10 interceptors in Poland and a mid-
    course discrimination radar in the Czech Republic would not provide
    protection for all of NATO European territory?
        General Obering. The percentage of NATO territory defended by the
    proposed deployment of the EIS, the AN/TPY (formally know as FBX-T) and
    the European Midcourse Radar, is 100 percent of those that are
    threatened by long range missiles from Iran.
        Against ICBM class threats, only 20 of the 24 European NATO
    countries or 80 percent are vulnerable to these missiles from Iran.
    With the EIS and AN/TPY-2 in place, all 20 of these are defended. The
    four remaining countries, Turkey and portions of Greece, Bulgaria and
    Romania are too close to Iran's borders to be threatened by ICBM class
    threats.
        Approximately 85-90 percent, or 23 of the 24, of the European NATO
    countries are vulnerable against Iranian IRBM class missiles and the
    EIS and AN/TPY-2 can defend all of these countries against this class
    of threat.
        Those countries that are vulnerable to attack against the shorter
    range threats from Iran could be defended by deploying other U.S.
    missile defense forces, such as Patriot PAC-3. U.S. missile defense
    forces such Aegis Standard Missile-3 (SM-3) and Terminal High Altitude
    Area Defense (THAAD) (supported by an AN/TPY-2) could be deployed in a
    crisis to fill any coverage gaps. NATO missile defense forces do not
    now exist. The only NATO owned equipment is the Airborne Warning and
    Control System (AWACS). Other equipment ownership is retained by the
    member nations and is counted as part of their contribution to the NATO
    Military Budget. This allows NATO, as an alliance or as individual
    countries, to focus on the deployment of the more affordable shorter
    range defensive systems.

        4. Senator Bill Nelson. General Obering, what percentage of NATO
    territory would NOT be defended by the proposed deployment, and what
    NATO nations would not be completely covered?
        General Obering. The percentage of NATO territory defended by the
    proposed deployment of the EIS, the AN/TPY (formally know as FBX-T) and
    the European Midcourse Radar, is 100 percent of those that are
    threatened by long range missiles from Iran.
        Against ICBM class threats, only 20 of the 24 European NATO
    countries or 80 percent are vulnerable to these missiles from Iran.
    With the EIS and AN/TPY-2 in place, all 20 of these are defended. The
    four remaining countries, Turkey and portions of Greece, Bulgaria and
    Romania are too close to Iran's borders to be threatened by ICBM class
    threats.
        Approximately 85-90 percent, or 23 of the 24, of the European NATO
    countries are vulnerable against Iranian IRBM class missiles and the
    EIS and AN/TPY-2 can defend all of these countries against this class
    of threat.
        Those countries that are vulnerable to attack against the shorter
    range threats from Iran could be defended by deploying other U.S.
    missile defense forces, such as Patriot PAC-3. U.S. missile defense
    forces such Aegis SM-3 and THAAD (supported by an AN/TPY-2) could be
    deployed in a crisis to fill any coverage gaps. NATO missile defense
    forces do not now exist. The only NATO owned equipment is the AWACS.
    Other equipment ownership is retained by the member nations and is
    counted as part of their contribution to the NATO Military Budget. This
    allows NATO, as an alliance or as individual countries, to focus on the
    deployment of the more affordable shorter range defensive systems.

        5. Senator Bill Nelson. General Obering, is it possible that other
    missile defense systems, including PAC-3, Aegis ballistic missile
    defense (BMD) and THAAD could provide defensive coverage of uncovered
    portions of Europe against future ballistic missile threats?
        General Obering. Yes, other BMD systems could provide defensive
    coverage of those countries that are not threatened by longer-range
    Iranian missiles, but remain vulnerable to shorter range Iranian
    threats. Patriot PAC-3 could be deployed, or Aegis SM-3 and THAAD
    (supported by an AN/TPY-2) could be deployed in a crisis to fill any
    coverage gaps. The number of ship locations and THAAD or PAC-3
    batteries required will depend on the threat missile class type (i.e.
    IRBM or shorter range class threat) and the sensor architecture used.
        These gaps could also be covered with a combination of U.S. and
    NATO, or indigenous defensive capabilities. NATO missile defense forces
    do not now exist. The only NATO owned equipment is the AWACS. Other
    equipment ownership is retained by the member nations and is counted as
    part of their contribution to the NATO military budget. This allows
    NATO, as an alliance or as individual countries, to focus on the
    deployment of the more affordable shorter range defensive systems.

                    DEFENSIVE COVERAGE OF THE UNITED STATES

        6. Senator Bill Nelson. General Obering, is it correct, as you have
    indicated, that the ground-based midcourse (GMD) system currently
    deployed in Alaska and California would provide defensive coverage of
    the United States against a potential future Iranian ICBM threat?
        General Obering. Yes, the ground based interceptors, currently
    deployed in Alaska and California, provide defensive coverage of the
    United States against potential Iranian ICBMs. This coverage is
    dependent on both the Fylingdales radar in the United Kingdom and the
    Thule radar in Greenland.
        The addition of a forward based radar and Eurpoean Midcourse Radar
    located, combined with the interceptors in Alaska and California, adds
    confidence and performance margin in the defense of Alaska and provides
    a hedge against threat uncertainty.
        The defense of the Fylingdales radar requires a EIS or another
    Ballistic Missile Defense System (BMDS) asset with capability to defend
    against ICBM and IRBM class threats.

                          NEAR-TERM, EFFECTIVE SYSTEMS

        7. Senator Bill Nelson. General Obering, last year Congress enacted
    legislation, section 223 of Public Law 109-364, that requires the
    Department to place a priority within the missile defense program on
    the development, testing, fielding and improvement of effective, near-
    term missile defense capabilities, specifically including the GMD
    system, the Aegis BMD system, the Patriot PAC-3 system, and the THAAD
    system, as well as their associated sensors. Can you tell us how the
    Department has implemented this requirement, and what changes were made
    to comply with this provision? In your answer, please indicate the
    fiscal year 2008 funds requested for these near-term capabilities.
        General Obering. The development, fielding, testing and improvement
    of effective near-term missile defense capabilities is a priority
    within the MDA and about $7.1 billion out of our total fiscal year 2008
    President's budget request of $8.9 billion is allocated for this
    purpose. In the near-term, we seek to maintain and sustain an initial
    capability to defend the homeland against limited ICBM threats and
    protect friends and allies and deployed forces against short- to
    medium-range threats. To achieve this goal, over the Future Years
    Defense Program (FYDP) we intend to complete the fielding of up to 44
    GBIs in Alaska and California; enhance our early warning radars in
    Alaska, California and the United Kingdom; field the Sea-based X-band
    (SBX) radar in the Pacific; field the first transportable THAAD fire
    units; deploy up to 132 sea-based SM-3 interceptors on 18 Aegis
    engagement ships; and expand our command, control and battle-management
    network by establishing three new command and control suites at U.S.
    Strategic Command, U.S. Pacific Command and U.S. Northern Command.
        In the near-term we also seek to close gaps and improve our
    capability to keep pace with growing threats. Accomplishing this
    objective requires the fielding of up to 10 GBIs and an associated GMD
    radar in Europe. We have also allocated resources which support
    continued development work that will improve these initial missile
    defense assets, and we continue to fund an increasingly operationally
    realistic testing program.
        The following chart provides funding details. Note that funds for
    procurement of PAC-3 missiles are included in the Army budget and the
    following chart shows MDA resources used for continued development of
    PAC-3.

                            KNOWLEDGE-BASED APPROACH

        8. Senator Bill Nelson. Mr. Francis, the Government Accountability
    Office (GAO) has recommended that the MDA should use a ``knowledge-
    based'' acquisition approach for all its programs. Apparently MDA has
    only partially implemented your ``knowledge-based'' recommendation and
    has a different understanding of that concept. Can you describe what
    you mean by a ``knowledge-based'' acquisition strategy, and how it
    differs from what you understand the MDA approach is?
        Mr. Francis. Much of what MDA has written about knowledge-based
    acquisition agrees with GAO's definition. However, we have not seen MDA
    put into practice an entirely knowledge-based strategy. Instead, it has
    implemented some aspects of the strategy. MDA defines knowledge points
    as those times within a program that data is obtained from discrete
    tests, demonstrations, or processes. This data is used to confirm
    earlier estimates or predictions and is to be linked with an explicit
    decision. The decision could involve money, schedule, performance
    requirements, or proceeding to the next stage of development. These
    knowledge points are program-specific, and MDA will measure actual
    performance for an individual program, like Airborne Laser, against the
    knowledge points it has set for that program.
        We identify three key points in a program when specific knowledge
    is important to success. These points represent aggregations of
    knowledge that can be judged against objective standards for
    acceptability. They correspond to the points at which a program is
    making investment decisions. These knowledge points and associated
    indicators are defined as follows:
    Knowledge point 1
              Resources and needs match. This point occurs when a sound
            business case is made for the product--that is, a match is made
            between the customer's requirements and the product developer's
            available resources in terms of knowledge, time, money, and
            capacity. Achieving a high level of technology maturity at the
            start of system development is an important indicator of
            whether this match has been made. This means that the
            technologies needed to meet essential product requirements have
            been demonstrated to work in their intended environment.
    Knowledge point 2
              Product design is stable. This point occurs when a program
            determines that a product's design is stable--that is, it will
            meet customer requirements, as well as cost, schedule, and
            reliability targets. A best practice is to achieve design
            stability at the system-level critical design review, usually
            held midway through development. Completion of at least 90
            percent of engineering drawings at the system design review
            provides tangible evidence that the design is stable.
    Knowledge point 3
              Production processes are mature and the design is reliable.
            This point is achieved when it has been demonstrated that the
            company can manufacture the product within cost, schedule, and
            quality targets. A best practice is to ensure that all key
            manufacturing processes are in statistical control--that is,
            they are repeatable, sustainable, and capable of consistently
            producing parts within the product's quality tolerances and
            standards--at the start of production. Demonstration of a
            prototype that meets reliability and performance requirements
            prior to the production decision can minimize production and
            post-production costs.
              We have not seen MDA gather all of the knowledge discussed
            above before deciding to move forward in the acquisition cycle.
            For example, MDA made the decision to produce and field the
            Ground-based Midcourse Defense System before it tested the
            element using production-representative hardware, in addition,
            MDA produced interceptors for operational use when it had not
            completed a successful intercept test in 2 years. Another
            example is MDA's establishment of the MKV program office and
            appointment of a program manager before technologies critical
            to the capability desired were mature and before it could
            prepare a knowledge-based estimate of developmental cost.

                  MDA USING FUNDS FOR PURPOSES NOT AUTHORIZED

        9. Senator Bill Nelson. Mr. Francis, you noted in your report that
    funding for an element of the BMD system is authorized to cover a range
    of activities and that if the MDA runs into problems with one activity,
    it can defer work on another activity to cover the cost of the
    problems. This sometimes means that funding authorized for one activity
    is used for another purpose. Do you have any thoughts as to how
    Congress might ensure that the funding it authorizes is used for the
    purpose for which it was authorized?
        Mr. Francis. To effectively manage the BMDS, MDA may need some
    flexibility to use funds for purposes other than those for which the
    funds were appropriated. For example, a more pressing need for the
    funds may arise or the agency may want to speed-up the development of
    an element that is maturing faster than expected. However, in instances
    where Congress has a special interest in knowing that funds are being
    used for their intended purpose, it could set dollar thresholds for
    moving funds within a budget program element that would trigger a
    report to Congress should that threshold be breached. We think this can
    be done in such a way that the MDA Director maintains his ability to
    make such decisions expeditiously, but at the same time providing
    Congress transparency into the consequences of those decisions.
    Congress might also consider designating certain funds as ``special
    interest'' and requiring that the use of any of the funds for any other
    purpose be reported.
        MDA could provide increased transparency of deferred work in a
    couple of ways. First, it could report the cost of deferred work as a
    cost of the block that it benefits. For example, work deferred from
    Block 2004 until Block 2006 could be accounted for and reported as a
    cost of Block 2004, regardless of when the work is performed.
    Alternatively, when MDA requests funds during a subsequent block to pay
    for deferred work, the agency could notify Congress that it is
    requesting funds for this purpose. The notification could include an
    identification of the block in which the work was originally planned
    and the amount of funding needed to pay for the deferred work.

        10. Senator Bill Nelson. Mr. Francis, would requiring that MDA
    notify Congress when it reprograms funding within a program element be
    a useful management process?
        Mr. Francis. Yes. By notifying Congress when it reprograms funds
    within an element, MDA would improve the transparency of its actions.
    An individual element can cover a full range of activities, including
    technology development, system development, production, fielding, and
    support. I think it is a reasonable expectation, given MDA's
    flexibility to move funds between these activities, that MDA notify
    Congress when it is doing so. However, notifying Congress may not
    necessarily have to mean obtaining prior approval, as discussed in the
    answer to question 11.

        11. Senator Bill Nelson. Mr. Francis, another option would be to
    require prior approval by Congress of certain proposed reprogramming
    actions, as is frequently done with other programs. In your view, could
    that be a useful oversight tool?
        Mr. Francis. MDA is required to report all reprogramming actions
    that result in $10 million or more being moved from one budget program
    element to another. There are benefits in terms of control in expanding
    MDA's reporting requirement to include some intra-program element
    reprogramming actions. For example, it may be worthwhile to report
    actions that involve the movement of funds from one activity to another
    within a program element if an established cost threshold is breached
    or if MDA plans to use funds appropriated for an activity in which
    Congress has a special interest for some other purpose. However, this
    amount of control must be weighed against the potential loss of
    flexibility that MDA currently has to manage its system of systems. For
    example, if prior approval were required before moving funds from one
    activity to another within a program element, the decisions would take
    longer. Alternatively, Congress could consider requiring notification
    of such reprogramming without necessarily requiring prior approval.
    This would preserve MDA's flexibility while providing Congress
    transparency into the reprogramming decisions.

                      INDEPENDENT LIFE-CYCLE COST ESTIMATE

        12. Senator Bill Nelson. Mr. Francis, your report notes that the
    MDA is not required to obtain an independent life-cycle cost estimate
    of the BMD System or its elements, as other major defense acquisition
    programs are required to do. From a standpoint of oversight and
    accountability, do you believe it would be useful to have an
    independent life-cycle cost estimate for the BMD System and its
    elements?
        Mr. Francis. Yes, increments of elements that have effectively
    entered system development and demonstration should be able to produce
    the information needed to estimate the life-cycle cost of that
    increment and to enable the Cost Analysis Improvement Group (CAIG) to
    independently verify that estimate. As we pointed out in our March 2007
    report, independent verification of a program's cost estimate allows
    decision makers to gauge whether the program is executable given other
    budget demands and it increases the likelihood that a program can
    execute its plan within estimated costs. However, we note that an
    element program office may have some ongoing efforts whose cost cannot
    be estimated. For example, a program could have one increment in system
    development and demonstration, but it could also be developing the
    technology important to a future increment. In such instances, the
    element program office would only estimate and have the CAIG validate
    the life-cycle cost of the increment whose technology is being
    integrated into a complete product. Studies of the best practices of
    leading commercial developers have shown that until all technologies
    critical to a desired capability are mature managers cannot make good
    cost, schedule or performance estimates. This is because technology
    development is a time of discovery that cannot be scheduled, whose
    outcome cannot be predicted, and whose cost cannot be accurately
    estimated.

                            ELEMENT-LEVEL REPORTING

        13. Senator Bill Nelson. Mr. Francis, your report recommends that
    the BMD program should report on cost, schedule, and performance at the
    individual missile defense element level, rather than at the entire BMD
    System level. Can you explain why, and why you think that should happen
    now?
        Mr. Francis. In our opinion, MDA should report on cost, schedule,
    and performance at both the BMDS level and the element level. Element-
    level reporting is needed because since 2002, MDA has achieved its
    primary mission of developing, fielding, and supporting an integrated
    BMDS through the efforts of individual BMDS elements. Most of the
    agency's budget is requested by the elements and a significant amount
    of the agency's work is accomplished through element contracts. For
    example, over 73 percent of MDA's fiscal year 2005 budget and 72
    percent of the agency's fiscal year 2006 budget was devoted to the
    support of the nine BMDS elements. It makes sense to report in the same
    manner that funds are budgeted. The elements provide the individual
    assets and capabilities that help comprise the overall BMDS capability.
        This does not mean that the BMDS has to be managed in a stove-
    piped, element-centric manner, however. I believe MDA should continue
    to manage BMDS as a system-of-systems versus as a byproduct of
    individual elements. A system-of-systems construct, like blocks, is
    useful for defining and managing the increments of an integrated BMDS.
    Moreover, it provides more latitude to make tradeoffs among individual
    requirements, costs, and capabilities while preserving the integrity of
    the overall BMDS. The block baseline should also be consistent with the
    baselines of the individual elements.
        The cumulative information gained from both element-level and BMDS-
    level baselines would allow decision makers to better assess the value
    that the missile defense program delivers for the investment being
    made. Determining the value for money is likely to become increasingly
    important as cost growth in entitlement programs decrease discretionary
    spending and as defense budgets are squeezed by mounting expenses to
    support the conflict in Iraq.

                          CONFIDENCE IN TWO-STAGE GBI

        14. Senator Bill Nelson. Dr. McQueary, at the hearing I described a
    two-stage variant of the GBI being developed by the MDA for possible
    deployment in Poland. The MDA has identified seven development risk
    areas it is working to mitigate on this missile, which has not
    completed development and has never been tested. My question to you was
    whether you have high confidence that this undeveloped and untested
    missile will perform in an operationally effective, reliable, and
    suitable manner. What is your current assessment?
        Dr. McQueary. There are added risks anytime a system's working
    design is changed. In the case of the two-stage variant of the GBI, I
    agree with MDA's seven developmental risk areas. I believe the most
    significant risk is with the software changes and integration that MDA
    must make not only in the interceptor, but also in the Command and
    Launch Equipment and the GMD Fire Control to optimize the interceptor's
    new performance envelope. There is commonality between the two-stage
    and three-stage variants of the GBI booster. MDA gained experience when
    it converted a three-stage Minuteman II into a two-stage Minuteman II.
    However, I cannot make an assessment on effectiveness, reliability, or
    suitability on a two-stage design that has not yet been built or
    tested. Through MDA's Integrated Master Test Plan, I will approve the
    combined developmental/operational flight testing of the two-stage
    interceptor, and my office and the joint operational test team will
    participate in all aspects of this testing.

                               INACCURATE MODELS

        15. Senator Bill Nelson. Dr. McQueary, at the hearing, I asked you
    whether you knew of instances when models had not accurately predicted
    the performance of the BMD System or its elements. You indicated you
    did not remember any specific examples. For example, did the GMD model
    predict that the GBI would not launch in IFT-13C, or predict the so-
    called ``Track Gate Anomaly''?
        Dr. McQueary. While models can provide useful predictions of system
    or component performance, they generally are not designed to predict
    hardware failure modes or software malfunctions. The GMD model did not
    predict the software timing problem that aborted the launch in IFT-13C.
    Even when software malfunctions are discovered during test, and the
    models are modified or developed to account for these malfunctions,
    they still may not accurately predict their severity or frequency. The
    ``Track Gate Anomaly'' is a good example. The GMD model did not
    initially predict ``Track Gate Anomaly''. Models of statistical
    occurrence which MDA developed for the ``Track Gate Anomaly'' did not
    accurately predict the frequency of occurrence during a recent flight
    test.

        16. Senator Bill Nelson. Dr. McQueary, can you check your agency's
    records to see if there are any specific examples and, if so, provide
    them and describe their significance?
        Dr. McQueary. MDA's experience with models is no different than the
    experiences of other acquisition programs in the Department of Defense
    (DOD). Some models do a good job of predicting or replicating
    capability and performance, and some don't. There are several examples
    where MDA's models did not match or predict system capabilities:
    [Deleted.]

                    FLIGHT TESTS REQUIRED TO VALIDATE MODELS

        17. Senator Bill Nelson. Dr. McQueary, your prepared testimony says
    that for you to have confidence in your assessment of the operational
    effectiveness of the BMD System, you need ``validated models and
    simulations,'' which you say ``don't exist today because MDA does not
    have enough flight test data to anchor them.'' Can you explain what you
    mean by validating and anchoring models and simulations, and why it's
    crucial to your assessment?
        Dr. McQueary. One of the purposes of testing is to gather the data
    necessary to validate that the models accurately represent the
    performance of the system under test. The process is simple. The model
    is used pre-test to predict the performance expected during the test.
    The test is run and the performance data is collected. A post-test
    reconstruction is accomplished to compare the actual performance to the
    predicted performance. The model is then adjusted to better predict
    system performance. It is an iterative process through which the
    model's fidelity continually improves. Once I am satisfied that the
    models are validated, I can use them to assess system capability. This
    is especially important in assessing capability at the edges of the
    system's performance envelope where peacetime, safety, and fiscal
    constraints usually apply.
        In the case of the BMDS, there are BMDS-level models and there are
    element-level models. I need both, correctly and efficiently working
    together, to accurately assess capability. Generally, the element-level
    models are more mature, have detailed validation plans, and are
    progressing toward validation through ground and flight testing. The
    BMDS-level models are not ready for use in my assessments, but should
    be ready to assess the FTG-04 pre and post test events and the Block 06
    BMDS in October 2007. I am working with MDA to understand the details
    and the timelines associated with development, integration, and
    validation of the BMDS-level models. The only way MDA can validate that
    these models accurately predict BMDS performance is to ``anchor'' them
    to flight test data.

        18. Senator Bill Nelson. Dr. McQueary, why would you not accept
    models and simulations as a substitute for flight tests?
        Dr. McQueary. We need the flight tests to validate that the models
    and simulations accurately reflect the performance of the system under
    test. Once they have been validated through flight test, they can be
    used confidently to predict system performance.

                   OPERATIONALLY REALISTIC GMD SALVO TESTING

        19. Senator Bill Nelson. Dr. McQueary, everyone seems to agree on
    the need for operationally realistic flight testing as the best means
    to have confidence in the operational capability of the BMD system.
    Since the GMD system firing doctrine is premised on being able to fire
    two interceptors at each target, do you agree that it would be
    important to test and demonstrate that capability in flight testing, as
    we are doing with other systems?
        Dr. McQueary. The ability of the GMD element of the BMD system to
    launch and guide two interceptors on a single target is an important
    capability that MDA must demonstrate to validate warfighter firing
    doctrine. The Patriot element has demonstrated this capability. Both
    the Aegis BMD and THAAD elements plan future tests to demonstrate this
    capability. It is logical that GMD should do so also. However, this
    test will require additional investment in the test infrastructure at
    Vandenberg AFB including the temporary modification of an operational
    silo into a test silo.

                          MULTIPLE TARGET GMD TESTING

        20. Senator Bill Nelson. Dr. McQueary, the GMD system is designed
    to defeat a small number of relatively simple targets. Do you believe
    it would be valuable to demonstrate that capability with flight testing
    of the system against multiple targets, so we have confidence in its
    capability? Would that be operationally realistic given the GMD
    mission?
        Dr. McQueary. Yes, but to do so within the capabilities of
    peacetime range and safety limitations will require sizeable investment
    in infrastructure (telemetry and flight safety systems) and more
    extensive coordination. A GMD flight test involving multiple targets
    and interceptors would be operationally realistic and, if successful,
    confidence building. Patriot has already demonstrated this capability.
    Aegis BMD recently demonstrated the capability to manage near
    simultaneous engagements of a ballistic missile and a cruise missile
    threat.

                          JOINT CAPABILITIES MIX STUDY

        21. Senator Bill Nelson. General Campbell, the Joint Force
    Component Command for Integrated Missile Defense (JFCC-IMD) conducts
    studies and analyses on missile defense capabilities, needs, and force
    structure. What are results of the Joint Capabilities Mix Study with
    respect to desired or required force structure of our regional missile
    defense systems, namely Patriot/PAC-3, Aegis BMD, and THAAD?
        General Campbell. The Joint Capabilities Mix (JCM) Study is an
    iterative opportunity for the joint communities of interest (including
    combatant commanders, Services, and the MDA) to explore weapons and
    sensor mixes to counter the expected threats in three major operation
    areas across three epochs (2012, 2015, 2020). JCM I, concluded in April
    2006, influenced MDA programmatic decisions to increase the number of
    Terminal High Altitude Area Defense (THAAD) firing units and
    interceptors, increase SM-3 interceptors, and start the Sea-Based
    Terminal program. JCM II has just concluded and results are being
    staffed and briefed through the Joint Requirements Oversight Commission
    process. The findings provide a recommendation of the number of upper-
    tier (THAAD and SM-3) interceptors required for certain contingencies.
    Additional study will be required to further refine the analysis.

        22. Senator Bill Nelson. General Campbell, do we have enough force
    structure today to satisfy combatant command operational plans, and are
    we planning and budgeting for enough in the FYDP? If not, which systems
    would we need more of to meet their operational plans?
        General Campbell. Requests for land and sea-based capabilities have
    emerged which significantly exceed the near-term worldwide inventory.
    The MDA has increased the Terminal High Altitude Area Defense (THAAD)
    equipment buy. The Army has requested an increase in force structure to
    man the additional THAAD equipment and has requested additional Patriot
    battalions as part of its plan to Grow the Army. For missile inventory,
    MDA has increased its THAAD and SM-3 buy. The Army continues to
    purchase and build the PAC-3 inventory, and is preparing to transition
    to the new PAC-3 Missile Segment Enhanced missile in fiscal year 2010.
    This new missile will significantly increase the Patriot battlespace
    and provide capability against a larger threat set. We continue to
    refine force structure requirements through additional analysis and
    inform MDA of future combatant command capability needs through the
    Prioritized Capability List.

                          MILITARY UTILITY ASSESSMENT

        23. Senator Bill Nelson. General Campbell, I understand that the
    JFCC-IMD has performed several military utility assessments of the GMD
    system for General Cartwright. How many of the assessments have been
    conducted and what have been the general conclusions for each of them?
        General Campbell. Strategic Command has conducted three military
    utility assessments. This annual assessment has been consistent in
    concluding that the BMDS provides a ``thin line'' of capability against
    the threat. The MDA has delivered additional capability each year,
    adding greater confidence in the operation of the BMDS.

                         UPGRADED/EVOLVED THAAD MISSILE

        24. Senator Bill Nelson. General Campbell, the missile defense
    system is intended to be a spiral development program. There is an
    opportunity to upgrade the THAAD missile to have far greater capability
    against missiles of greater range and complexity. Do you support
    increasing the capability of the THAAD missile to provide enhanced
    defensive capability?
        General Campbell. The Terminal High Altitude Area Defense (THAAD)
    is an emerging capability for area defense. There are potential
    opportunities to develop more robust enhancements to the THAAD missile
    in future years. However, the increase in cost to field these
    enhancements is dramatic, even when compared to what is currently
    programmed. The planned THAAD program will provide a terminal upper
    tier capability that complements our midcourse and lower tier systems.
    We should continue to build a balanced BMDS as currently planned. We
    should examine THAAD's potential for growth and determine if the cost
    of the additional capability allows us to sustain a balanced program.
                                     ______

                   Questions Submitted by Senator Carl Levin

                         WHICH MISSILE FOR DEPLOYMENT?

        25. Senator Levin. General Obering, if the decision were made to
    deploy GBIs 41-50 at Fort Greely, rather than in Europe, would you
    deploy more of the existing 3-stage interceptors, or use the new
    developmental 2-stage version?
        General Obering. If the decision were made to deploy GBI's 45-54 at
    Fort Greely rather than in Europe, more of the existing 3-stage
    interceptors would be used. The 2-stage configuration GBI is being
    developed specifically for the EIS. Its shorter minimum engagement time
    is better suited to engage threat ranges in the European Theater. The
    EIS, combined with a forward-based radar, provides considerable
    redundant coverage of the U.S. and, depending on the threat, defends
    Western and Central Europe and most of Eastern Europe. Neither three-
    stage nor two-stage interceptors at Fort Greely and Vandenberg AFB can
    defend Europe.

        26. Senator Levin. General Obering, since the budget request seeks
    funds for the possible deployment of GBIs 41-50 at Fort Greely, does
    the funding requested in the fiscal year 2008 budget request for
    interceptors 41-50 permit the production of 10 more three-stage GBIs?
        General Obering. Yes, funding requested for OBV-2 stage (GBIs #45-
    54) could be diverted and used to acquire 3-stage GBIs in full, and
    emplacing these interceptors at Fort Greely would provide additional
    capability for the BMDS. However, The Department's plan is to deploy
    the OBV-2 stage at the EIS and the resources requested in MDA's fiscal
    year 2008 President's budget support this plan. The purpose of
    emplacing these interceptors at the European site is to enhance
    protection of the U.S homeland from emerging long range Middle Eastern
    threats, as well as extend missile defense coverage to our friends,
    allies and deployed forces in Europe from long-range and intermediate-
    range Middle Eastern threats. This defensive capability could not be
    accomplished by emplacing three-stage GBIs at Fort Greely.

                      RESULTS OF SEPTEMBER GMD FLIGHT TEST

        27. Senator Levin. General Obering, the flight test of the GMD
    system last September (FTG-02) was considered a success. However, I
    understand that there were some technical issues with the interceptor
    that caused a 4-month delay in the next test of the system. Please
    describe those technical issues and the status of the corrections for
    them.
        General Obering. [Deleted.]

                                 POLISH CONCERN

        28. Senator Levin. Mr. Green, the former Polish Minister of
    Defense, Radek Sikorski, who is now a member of Poland's parliament,
    recently wrote in the Washington Post that the U.S. proposal to place
    GMD interceptors and a radar in Europe ``could provoke a spiral of
    misunderstanding, weaken NATO, deepen Russian paranoia, and cost the
    United States some of its last friends on the continent.'' If that were
    the result of the proposed deployment in Europe, do you believe that
    would be in our national security interest, and would you support such
    a deployment?
        Mr. Green. If these outcomes were likely, we would reconsider our
    plans to deploy U.S. missile defenses in Europe. However, in light of
    recent events, I believe such results are unlikely.
        NATO ministers met at the North Atlantic Council meeting on April
    19 and, according to Secretary General Jaap de Hoop Scheffer, ``agreed
    that the threat of missile attacks is real and that NATO is the right
    framework for discussions on missile defense.'' Rather than indicating
    that missile defense initiatives would divide and weaken the Alliance,
    NATO members expressed ``a shared desire that any U.S. system should be
    complementary to any NATO missile defense system'' and that ``the
    principle of indivisibility of security should apply.'' Moreover, NATO
    recently decided to assess the full political/military implications for
    the Alliance of the U.S. missile defense proposal and prepare a report
    by February 2008.
        U.S. Government representatives have consulted with and briefed
    numerous European government and European Union representatives on U.S.
    plans for basing missile defenses in Europe. These officials
    appreciated the U.S. efforts to apprise them of its plans, and they
    left the meeting with a better understanding of U.S. intentions.
    Although a few officials expressed reservations, most have responded
    positively.
        With regard to Russia, U.S. officials have met with the Russians
    repeatedly to explain that limited U.S. missile defense deployment in
    Europe is not directed at Russia and that it does not constitute a
    threat to Russian strategic forces. A detailed list of missile defense
    cooperation opportunities has also been presented to the Russians,
    which they agreed to discuss in technical expert meetings. President
    Putin did offer to drop Russian objections to the U.S. proposal to
    place missile defense assets in Poland and the Czech Republic if the
    U.S. would agree to use the Russian-controlled radar in Gabala,
    Azerbiajan in lieu of a new radar in the Czech Republic. Secretary
    Gates said he was pleased that the Russians acknowledge the threat of
    Iranian ballistic missiles and that action is necessary to counter this
    threat. He also said that although the U.S. is still firmly committed
    to bilateral negotiations with the Czech Republic, we look forward to
    discussing the Russian proposal at technical expert meetings in the
    future.

                         WHO PAYS FOR DEFENSE OF NATO?

        29. Senator Levin. Mr. Green, NATO has a long-standing tradition of
    having financial burden-sharing arrangements with the United States in
    which NATO pays for a share of the military capabilities that provide
    its protection and security. How much of this proposed $4 billion
    missile defense system intended to defend Europe will NATO be paying
    for under a NATO burden-sharing agreement?
        Mr. Green. The U.S. Government has made a proposal to deploy U.S.
    missile defense assets in Poland and the Czech Republic that will help
    defend the U.S. homeland and U.S. forces in Europe from long-range
    threats from Iran. The U.S. missile defense site also will be capable
    of defending much of Europe. We are not asking NATO to contribute
    financially to the cost of this deployment;
        NATO missile defense contributions come in other forms. To address
    short and medium range missile threats, NATO has allocated 800 million
    (about $1 billion) for the Active Layered Theater Ballistic Missile
    Defense, a command and control backbone for NATO member countries'
    missile defense systems. If negotiations are successfully concluded
    with Poland and the Czech Republic, they will contribute significant
    ``in-kind'' resources in allowing U.S. systems to be deployed on their
    territory. The U.K. and Denmark agreed to allow the U.S. to upgrade
    early warning radars on their territories for BMD use.
        Other NATO allies already have or are pursuing short and medium
    range missile defense capabilities, including acquiring/upgrading
    Patriot PAC-2/3 systems, and co-developing Medium Extended Air Defense
    System. Several of our European allies have expressed interest in
    acquiring sea-based midcourse interceptors for use on their Aegis-
    equipped ships.

                  HOW MANY FLIGHT TESTS NEEDED FOR CONFIDENCE?

        30. Senator Levin. Dr. McQueary, your prepared testimony says that,
    because there have not been enough flight tests, you don't have
    validated models and simulations needed to give you confidence in the
    performance of the BMD System. How many additional successful flight
    tests must MDA conduct before you will have high confidence in the
    performance predictions of BMD System models and simulations?
        Dr. McQueary. I cannot give you that number today. We evaluate each
    flight test and associated ground test campaign to assess the
    confidence in the predictions of the models. Last fall I told General
    Obering that I would need validated models and simulations to assess
    the capability of the BMDS. He agreed and took action to develop the
    plan to get the data to support validation. Although the element-level
    models are acceptable for performance assessment, they don't integrate
    well with the less mature BMDS-level models. Element and BMDS models
    have to work together to accurately predict BMDS performance; they do
    not at this time. The interfaces are different, the software languages
    are different, the hardware is different, and the communications links
    are different. Once they work together, MDA must validate that they
    correctly and accurately represent BMDS performance. This requires both
    validation plans and test data. MDA is working on both. I am working
    with MDA to understand the details and the timelines associated with
    development, integration, and validation of these models. Once MDA
    finalizes its plans and provides them to me, I should be able to give
    you an estimate of the number of flight tests required to validate the
    BMDS models and simulations.

        31. Senator Levin. Dr. McQueary, how long do you expect it will
    take until those flight tests are conducted?
        Dr. McQueary. I will not be able to give you that estimate until I
    get the validation plans from MDA that define the number of flight
    tests required. However, it is imperative that General Obering continue
    to follow the prudent test-analyze-fix-test approach to flight testing
    that he adopted following the reviews of the December 2004 and January
    2005 flight test failures, and I am confident he will do so.

        32. Senator Levin. Dr. McQueary, for each of the near-term BMDS
    weapon elements (GMD, Aegis BMD, THAAD), how many more successful
    flight tests would be required for you to have confidence that the
    element will perform in an operationally effective and suitable manner
    under operational conditions?
        Dr. McQueary. Fiscal constraints will likely make it impossible to
    achieve statistical confidence in the operational effectiveness and
    suitability of the BMDS. For example, to achieve 80 percent confidence
    that an element can perform its mission successfully 80 percent of the
    time (80/80), the element would have to complete 10 consecutive,
    successful flight tests using the same geometry, scenario, and
    hardware/software configuration. For higher confidence/success, the
    number of consecutive, successful tests is even higher: 90/80-13, 80/
    90-21, and 90/90-28. Therefore, assessing the operational effectiveness
    and suitability for each element is going to be a combination of flight
    tests and modeling and simulation. If I have validated models and
    simulations, the currently planned flight test programs for Aegis BMD
    and THAAD should be adequate for me to assess operational effectiveness
    and suitability for their current spiral development phases. This
    assumes no further reductions in their currently planned flight test
    programs. On the other hand, the current GMD flight test program is
    early in its developmental phase and still recovering from the two
    failures in December 2004 and February 2005. General Obering is
    following a prudent ``test-analyze-fix-test'' approach which, when he
    finds problems, results in testing delays. The current FTG-03 delay is
    a good example. At the same time, MDA must validate its models, a
    process directly related to flight testing. As a result, at this time
    it is impossible for me to estimate the number of successful flight
    tests I will need to assess GMD operational effectiveness and
    suitability.

                              OPERATIONAL TESTING

        33. Senator Levin. Dr. McQueary, is it correct that there is still
    no operational testing planned for the GMD system and other MDA
    elements? If so, why is that?
        Dr. McQueary. At the present time, the only operational testing MDA
    plans and is conducting for GMD and the other BMDS elements is combined
    developmental/operational testing. My office works closely with MDA to
    develop the parameters of these tests. Current Department policy
    relieves MDA from conducting operational testing until it declares an
    element ready for transition to a Service with that Service planning
    for a production run. Congressional direction allows MDA to accomplish
    limited fielding using RDT&E funds.

        34. Senator Levin. Dr. McQueary, do you believe there is still a
    need for operational testing of the GMD system and other elements of
    the BMD System?
        Dr. McQueary. Over the years, we have seen the value of operational
    testing. Every time we get the warfighters operating the systems in
    their intended environments and roles, we learn both the strengths and
    the limitations of these systems. Operational testing can take several
    forms. It can be the classic title 10 U.S.C. ``stand alone''
    operational testing, or it can be combined developmental/operational
    testing. Following current Department policy, MDA has developed a
    combined developmental/operational test program for the BMDS. Using the
    congressionally-mandated and Director of Operational Test and
    Evaluation (DOT&E)/MDA-developed Operational Realism criteria, we have
    seen increasing operational realism in MDA's combined developmental/
    operational test program. This approach is not perfect, but it is
    working. As MDA gains confidence in the BMDS, it allows more
    operational realism in each succeeding test.

                              UNCLASSIFIED REPORTS

        35. Senator Levin. Dr. McQueary, most of the material in your last
    two missile defense reports appears to be unclassified, even though the
    reports themselves are classified. Would it be possible for your next
    annual BMD report to be unclassified, with a classified annex?
        Dr. McQueary. We are looking at the possibility of publishing an
    unclassified BMDS report with a classified annex. Since the 2007 report
    will be a report on the BMDS Block 2006 capability (required by
    National Defense Authorization Act for Fiscal Year 2006) rather than a
    report on the 2007 test program (required by National Defense
    Authorization Act for Fiscal Year 2002), more of the report may be
    classified than in the past. We'll make the determination as we begin
    putting the report together. Our intent will be to make as much of the
    report unclassified as we can while maintaining appropriate security.

                   USE OF NON-RESEARCH AND DEVELOPMENT FUNDS

        36. Senator Levin. Mr. Francis, MDA is asking Congress to extend
    its authorization to use exclusively research and development funds to
    procure and deploy operational assets. In your recent report, you
    recommend that future operational missile defense assets should be
    purchased with procurement funds. Can you comment on whether you would
    also recommend that MDA should request operations and maintenance
    funding to provide support for fielded assets, and military
    construction funds to build operational missile defense facilities, and
    if you do, why?
        Mr. Francis. Yes, I recommend that MDA use operations and
    maintenance funds to support fielded assets, as well as military
    construction funds to build operational missile defense facilities.
    First, requesting money according to the purpose for which it is to be
    used would put MDA's budget on the same basis and terminology as that
    of other programs. Second, because MDA's budget already identifies the
    funds it plans to use to operate and maintain assets in the field, it
    would not be difficult for MDA to formulate a request for operations
    and maintenance funds. Third, using the correct appropriation to
    request funds would improve transparency and accountability as funds
    could not be moved between appropriations without congressional
    approval. In addition, because military construction projects must
    provide for full funding of the complete cost of construction, Congress
    will be aware of the full cost of a project at the time funds are
    requested and future Congresses will not be in the position of having
    to provide additional funds to ensure a usable end item.

                       COMPARING ACQUISITION FLEXIBILITY

        37. Senator Levin. Mr. Francis, are there other major defense
    acquisition programs that have been given the same level of acquisition
    flexibility as has been granted to the BMD program? If so, do you see
    the same issues with program transparency, accountability, and
    oversight in those programs as you see in the missile defense program?
        Mr. Francis. I am not aware of any other acquisition program that
    has been granted as much flexibility as MDA. DOD has allowed other
    programs some limited flexibility. For example. DOD has allowed the
    Future Combat Systems program more fluidity in establishing
    requirements and less stringent milestone exit criteria. However, the
    program does operate within the traditional acquisition framework that
    makes programs accountable for their planned outcomes and cost. MDA on
    the other hand is not yet required to apply several important oversight
    mechanisms that, among other things, provide transparency into program
    progress and decisions. For example, MDA is not expected to comply with
    user-established requirements, operational requirements documents, an
    approved program baseline, independent cost estimates, or milestone
    decisions.
                                     ______

                    Questions Submitted by Senator Jack Reed

                        IMPROVED TRANSPARENCY REPORTING

        38. Senator Reed. General Obering, in its March 2007 report, the
    GAO recommended that to improve the transparency of the BMD program,
    MDA should establish cost, schedule, and performance baselines for
    those elements effectively in the ``system development and
    demonstration'' phase, and report against those baselines. MDA
    partially concurred with this recommendation, but was concerned that an
    element-centric approach would detract from its efforts to develop a
    single integrated BMD System. GAO continues to support its
    recommendation because the element-centric reporting approach reflects
    the way MDA requests funding and contracts for development of the BMD
    System. What reporting basis would MDA recommend to provide a similar
    level of transparency as reporting against element baselines would
    provide?
        General Obering. We understand the GAO's desire for traceability.
    However, we are convinced that the element-centric reporting approach
    that GAO prefers is not the best way, nor the only way to achieve its
    objectives. As indicated in the DOD response to the GAO, the single
    integrated development approach for the BMDS has afforded the MDA the
    opportunity to make both technical and programmatic trades; thus
    enabling us to rapidly make prototype and test assets available for
    operational use. We stated our intent to modify our current biennial
    block approach to improve our reporting against the system-level
    baselines in accordance with section 234 of the National Defense
    Authorization Act for Fiscal Year 2005. We have not yet worked out the
    details of a new reporting basis, but we intend to work with both the
    GAO and your staff as we proceed with this effort over the coming
    months. We believe the result of this effort will be a reporting system
    that will provide appropriate transparency to satisfactorily address
    GAO's concerns.

        39. Senator Reed. General Obering, would MDA adjust its budget
    requests and contracts to match its reporting approach?
        General Obering. Because we have not worked out the details of a
    revised block approach, I cannot answer your question directly at this
    time. I do not anticipate that we would adjust budget requests or
    contracts to fit the reporting requirements. As I see it, the
    definition of the work to be done determines how we structure our
    budget requests and our contracts. Reporting must be adapted to reflect
    accurate and meaningful information. Reporting requirements must not be
    allowed to dictate how we structure our program. Sound management
    practice must remain focused on desired program investment outcomes;
    reporting is important and necessary in that context, but should not
    become more important than successfully fielding BMDS capability.

                      IMPROVED ACCOUNTABILITY INFORMATION

        40. Senator Reed. General Obering, in commenting on GAO's March
    2007 report, MDA partially concurred with GAO's recommendation to
    provide program element information that is consistent with the
    acquisition laws that govern baselines and unit cost reporting.
    However, MDA did not fully concur because it was concerned that
    element-level reporting would have a potentially fragmenting effect.
    The agency did, however, agree to provide additional information to
    Congress to promote accountability, consistency, and transparency. What
    kinds of information does MDA plan to provide that will make the
    missile defense program more accountable and transparent?
        General Obering. We have not yet worked out the specific details of
    a new reporting approach. However, we will work with GAO to establish a
    reporting system that will satisfactorily address their concerns, but
    does not adversely affect the BMDS program by focusing on the parts to
    the detriment of the whole.

                    JAPAN AGREEMENT ON MULTIPLE KILL VEHICLE

        41. Senator Reed. General Obering, you have decided to pursue a
    Multiple Kill Vehicle (MKV) program for the Standard Missile -3, Block
    2 interceptor that the United States is developing with Japan. Has
    Japan agreed to pursue only a MKV, and to forego the planned unitary
    kill vehicle?
        General Obering. MDA has not made a final decision on when to
    pursue an MKV program for the SM-3 Block IIA. MDA has presented
    briefings on the MKV program and an U.S.-only analysis plan during
    meetings with Japanese officials since December. Japan reaffirmed its
    desire to continue with the current SM-3 Blk IIA Cooperative
    Development project. Japan also said that it understands that the
    threat is evolving and given sufficient justification would consider
    cooperating on MKV as a separate program. The Japanese representatives
    stressed the necessity of receiving from the U.S. information on the
    evolving threat to help develop a consensus within the MOD on how best
    to proceed. Next steps are for the U.S. to report the results of its
    U.S.-only analysis in May and for the U.S. to encourage Japanese
    leadership to begin a joint analysis in June.

        42. Senator Reed. General Obering, what will you do if Japan does
    not agree to your plan for MKV?
        General Obering. We have just begun discussions with Japan on the
    MKV concept and hope that our U.S.-only analysis encourages Japanese
    leadership to begin a joint analysis in June. We look forward to
    further discussions with Japan on this subject throughout the year.

        43. Senator Reed. General Obering, what is your backup plan if MKV
    technology does not work?
        General Obering. The MKV provides considerable capabilities to
    engage multiple warheads and overcome countermeasures that the single
    kill vehicles cannot address. However, if the MKV technology does not
    work, the alternative is to use a single kill vehicle (or kinetic
    weapon) variant of the MKV payload.

                          NEED FOR MORE TESTING ON C2

        44. Senator Reed. Dr. McQueary, the nerve system and brain of the
    BMD is its Command and Control, Battle Management, and Communications
    system. It is an incredibly complex system with many sensors with
    different views of activities at different times, all of which must be
    fused together to form one common, coherent, and integrated picture to
    help decisionmakers understand what is happening and provide the
    ability to manage and control the system under stressing conditions. If
    the Command and Control system fails, the system could fail, or at
    least fail to perform optimally. Do you believe there is a need to do
    more testing of the Command, Control and Battle Management system to
    better understand its capabilities and limitations, and to help improve
    it? If so, what additional testing do you believe would be necessary or
    useful, and why?
        Dr. McQueary. Last year MDA adopted a year long ``campaign''
    approach for testing the Command and Control, Battle Management, and
    Communications (C2BMC). It is a ``crawl-walk-run'' approach that builds
    up to a fully-distributed test of all the ground hardware and
    communication links in the BMDS. This is a logical way for MDA to
    incrementally add and test C2BMC capability. Last year's campaign, the
    Ground Test 01 series, was very successful. MDA is well into this
    year's campaign, the Ground Test 02 series. As MDA adds operational
    realism to the individual flight tests, it is doing more and more
    testing of the C2BMC capability to fuse data to form one common,
    coherent, and integrated picture. C2BMC testing at various levels and
    complexity is nearly continual now. Overall system performance
    improvements are limited primarily by the speed at which the software
    in this massive system can be improved, modified, tested, and
    integrated. I am satisfied with the level of testing that MDA is
    currently pursuing.

                           IS ONE FLIGHT TEST ENOUGH?

        45. Senator Reed. Dr. McQueary, if an element of the BMD system has
    one successful flight test, is that enough to give you confidence that
    it will work in an operationally effective and suitable manner, or do
    you need to conduct multiple flight tests using different operationally
    realistic and complex scenarios to provide confidence in system
    performance?
        Dr. McQueary. Other than Patriot, I'm not ready to state that any
    element of the BMDS is operationally effective and suitable.
    Repeatability is a very important element of operational effectiveness
    and suitability. One successful test doesn't demonstrate operational
    effectiveness or generate enough data to determine suitability.
    Additional testing in multiple realistic and complex scenarios will
    increase confidence, but will be restricted by peacetime safety and
    fiscal constraints. The tests that MDA does accomplish will help anchor
    the models and simulations which we can then use to evaluate capability
    in much more of the performance envelopes of the various elements of
    the BMDS.

                             STILL A LONG WAY TO GO

        46. Senator Reed. Dr. McQueary, your prepared testimony says,
    ``There is still a long way to go'' with respect to testing of the BMD
    system. What do you mean by that, and what else remains to be done?
        Dr. McQueary. The BMDS is probably the largest, most complex combat
    system in the DOD. The many components--sensors, shooters, and C2BMC--
    are at different levels of development and maturity. The many sensors,
    ground and satellite based, are in various aspects of development,
    modification, and testing. Patriot is fully operational and fielded.
    Aegis BMD has a capability primarily limited by the number of modified
    cruisers. The Terminal High Altitude Area Defense system is still early
    in its developmental test program but is showing rapid progress. The
    GMD system has had one flight test of the production booster and kill
    vehicle that ended with an intercept of a threat-representative target.
    C2BMC is still in the early stages of development. Many more tests of
    these elements and their integration into the BMDS must be accomplished
    to demonstrate repeatability, anchor models and simulations, and build
    confidence. That's why I stated ``There is still a long way to go''
    with respect to testing the BMDS.

                     STATUS OF PREVIOUS GAO RECOMMENDATIONS

        47. Senator Reed. Mr. Francis, your report states that DOD has not
    implemented all your previous recommendations on missile defense
    acquisition. Which recommendations has DOD not implemented, and what
    effect do you believe that has had?
        Mr. Francis. From March 2005 through the issuance of our latest
    missile defense report in March 2007, we made nine recommendations and
    MDA has not yet implemented them. These recommendations propose that
    MDA:

             adopt a knowledge-based acquisition strategy
            consistent with those called for in DOD acquisition
            regulations,
             assess whether a 2-year block strategy is compatible
            with a knowledge-based acquisition strategy,
             clarify and modify block policy to align cost and
            fielding goals,
             adopt more transparent criteria for identifying and
            reporting significant changes in MDA's goals,
             develop baselines for all elements effectively in the
            system design and demonstration phase of the acquisition cycle,
             provide information to Congress that is consistent
            with the spirit of acquisition laws that govern baselines, unit
            cost reporting, independent cost estimates, and operational
            test and evaluation,
             include in blocks only elements that will field
            capabilities during the block,
             request procurement funds to acquire operational
            assets, and
             conduct an independent evaluation of the Airborne
            Laser and Kinetic Energy Interceptor programs prior to deciding
            their futures.

        Our recommendations were meant to make the Ballistic Missile
    Defense (BMD) program's decisions and actions more transparent, to hold
    the program more accountable for the funds it receives and the actions
    it takes, and to enable better oversight. Without change, we continue
    to see the same problems. The scope of a block is not firm but changes
    annually, making it difficult to determine what each block will
    deliver. Cost issues make it impossible to compare the value of a block
    to its cost. For example, block costs cannot be determined because work
    that cannot be completed during one block is pushed into a future
    block, along with its cost. Neither can an operational asset's unit
    cost be identified because assets are being acquired piecemeal over a
    number of years. Additionally, unit cost growth is hidden since a unit
    cost estimate is not established at the time funds are first requested
    and there is no base with which an asset's actual cost can be compared.
    We also continue to see MDA stray from the knowledge-based approach
    that allows successful developers to deliver, within budget, a product
    whose performance has been demonstrated. Instead, MDA continues to
    field assets before their capability is known.

                           MDA BLOCK SCHEDULE SYSTEM

        48. Senator Reed. Mr. Francis, the MDA's 2-year block management
    approach is confusing, and doesn't seem to have clear meaning,
    especially since MDA can change the scope and schedule of what is in
    any given block. From your standpoint, does MDA's 2-year block
    structure help or hurt from an accountability and oversight standpoint?
        Mr. Francis. MDA's 2-year block management approach does reduce
    program accountability and make oversight more difficult. MDA has found
    that 2 years is not always enough time to complete all of the work
    planned for a block. For example, the Ground-based Midcourse Defense
    (GMD) element reported at the end of Block 2004 that not all planned
    work was completed. According to GMD officials, this work was deferred
    until Block 2006 and its cost is being recognized as a cost of Block
    2006. However, the officials could not tell us how much of the Block
    2006 budget is attributable to the deferred work. The result is that
    the cost of Block 2004 is understated and the cost of Block 2006 is
    overstated. In addition, if MDA delays Block 2006 work until Block
    2008, as expected, Block 2006 cost will become more difficult to
    compare with its originally estimated cost as the cost of the deferred
    work will no longer be considered a Block 2006 cost. While the block
    concept is a useful construct for harvesting and fielding capability
    incrementally, it is a muddy concept for accountability. Additionally,
    as work travels from one block to another, the connection between the
    actual cost and scope of work completed and the estimated cost and
    scope of work used to justify budget requests is weakened, making it
    difficult for decision makers to determine the value of the investment
    being made in missile defense. The block management approach does focus
    management on the system-of-systems level, which facilitates making
    decisions that cross traditional program lines. This makes it possible
    for MDA to have more options as to how to meet a requirement, and could
    reassign a requirement from one element to another if conditions
    warranted. We believe that this system-of-systems or portfolio
    perspective for managing and making decisions is good. However, we also
    believe that this perspective can be maintained while at the same time
    providing the same or nearly the same level of transparency,
    accountability, and oversight as other major weapon system programs.
    This has been the aim of our recommendations for the revisions being
    considered for MDA's block approach.

                         PATRIOT PURE FLEET INITIATIVE

        49. Senator Reed. General Campbell, I understand that the Army
    Chief of Staff included the Patriot PAC-3 Pure Fleet initiative as a
    high priority on his fiscal year 2008 Unfunded Priorities List
    submitted to Congress. I gather that implementing the Patriot Pure
    Fleet initiative would provide all Patriot battalions with the latest
    PAC-3 capabilities. Can you provide a description of the benefits of
    upgrading all Patriot battalions to this enhanced PAC-3 configuration?
        General Campbell. Patriot Advanced Capability-3 (PAC-3) provides
    significant increase over Configuration-2 in every key measurable
    capability-increased range and fidelity for surveillance and target
    identification, increased probability of kill, and larger defended
    area. The Configuration-3 Radar provides substantial surveillance
    improvement. The Configuration-3 Radar can detect a ``basketball size''
    object versus a ``pick-up truck size'' object for the Configuration-2
    Radar. The Configuration-3 Radar is able to discriminate debris and
    decoys from actual targets which equates to higher probability of kill
    and less missile expenditure. The PAC-3 Launcher uploads 4 times the
    number of missiles and fires the PAC-3 missile which provides increased
    lethality through Hit-to-Kill technology able to defeat submunitions
    and Weapons of Mass Destruction (WMD). Configuration-3 also provides a
    7-fold increase in battlespace resulting in a greater defended area and
    allows remote launch capability three times farther than Configuration-
    2 and significantly extends the Tactical Ballistic Missiles footprint.
    Pure Fleeting the Patriot force will increase the size of the pool of
    deployers and increase our Nation's strategic flexibility against the
    Tactical Ballistic Missile threat.

        50. Senator Reed. General Campbell, if fiscal year 2007 and fiscal
    year 2008 funds are approved for this initiative, what capability
    enhancements to missile defense capabilities would be realized?
        General Campbell. Yes. Patriot is our Nation's only fielded ground-
    based tactical BMD weapon and is a strategic asset with implications in
    multiple theaters overseas. Improving our Nation's tactical BMD
    capability is needed to support the combatant commanders. The Army is
    committed to funding the PAC-3 Pure Fleeting of the remaining three
    Configuration-2 capable battalions. The current strategy involves a
    combination of reprogramming from the fiscal year 2007 main budget to
    complete the pure fleeting action. Additionally the Army intends to
    utilize ``Grow the Army'' funds to create two additional PAC-3
    battalions. At end state, Patriot Pure Fleet and growth of the PATRIOT
    force will provide 15 PAC-3 battalions enabling greater strategic
    flexibility of our Nation's missile defense forces while reducing the
    stress on the Patriot force.

        51. Senator Reed. General Campbell, as the Army's senior missile
    defense commander, do you support additional funding for the Patriot
    PAC-3 Pure Fleet initiative?
        General Campbell. Yes. Patriot is our Nation's only fielded ground
    based Tactical BMD weapon and is a strategic asset with implications in
    multiple theaters overseas. Improving our Nation's tactical BMD
    capability is needed to support the combatant commanders. The Army is
    committed to funding the PAC-3 Pure Fleeting of the remaining three
    Configuration-2 capable battalions. The current strategy involves a
    combination of reprogramming from the fiscal year 2007 main budget to
    complete the pure fleeting action. Additionally the Army intends to
    utilize ``Grow the Army'' funds to create two additional PAC-3
    battalions. At end state, Patriot Pure Fleet and growth of the Patriot
    force will provide 15 PAC-3 battalions enabling greater strategic
    flexibility of our Nation's missile defense forces while reducing the
    stress on the Patriot force.

                    CURRENT NATO POSITION ON MISSILE DEFENSE

        52. Senator Reed. Mr. Green, the NATO Secretary General indicated
    that NATO has decided to pursue missile defense for its deployed
    military forces, but not its territory and its population. Is that
    correct, that NATO has not decided to defend its territory or its
    population?
        Mr. Green. NATO has taken no decision on whether to pursue
    territorial missile defenses against long-range ballistic missiles but
    has been examining the feasibility of such defenses. The focus of NATO
    and NATO Allies to date has been on missile defenses to address the
    shorter-range ballistic missile threat. NATO agreed to develop and
    deploy the active Layered Theater BMDS, where Alliance members' theater
    missile defense systems will be integrated using the NATO Air Command
    and Control System as the command and control backbone for deployed
    terminal missile defense systems, resulting in a financial commitment
    by the Alliance of approximately $800? million. NATO completed a study
    in 2006 on the feasibility of a NATO defense for European population
    and territory from long range missile attack. This study concluded that
    such a defense is feasible. As a result of the 2006 feasibility study,
    NATO is currently assessing the political and military implications of
    such a defense. It recently modified this effort to account for the
    deployment of U.S. missile defense assets in Europe.

        53. Senator Reed. Mr. Green, so in that context, is it accurate to
    say that the U.S. proposal to deploy a territorial missile defense
    system in Europe goes beyond the current NATO position?
        Mr. Green. NATO has not made a decision yet to pursue a NATO-funded
    defense against long range ballistic missile threats. However, NATO, to
    a large degree, has a common understanding of the growing ballistic
    missile threat. NATO recognizes and accepts the U.S. approach of
    negotiating bilaterally with Poland and the Czech Republic. NATO also
    accepts missile defense as a reasonable approach to the missile threat,
    as evidenced in their efforts to field missile defense to address short
    and medium range threats. NATO demonstrated that it recognizes and
    accepts the reality of the U.S. missile defense deployment in Europe by
    agreeing recently to consider the U.S. site in its ongoing study.
                                     ______

                   Questions Submitted by Senator Mark Pryor

                            MISSILE DEFENSE TESTING

        54. Senator Pryor. General Obering, the MDA uses the integration of
    technologies to create an overwhelming advantage against enemies who
    would use ballistic missiles to threaten the national security of the
    United States. The recent missile defense intercept test (April 6) for
    the THAAD interceptor successfully demonstrated beyond-line-of-sight
    communications and radar tracking/target discrimination objectives.
    While I'm sure you would agree with me that the missile defense program
    is quite expensive, costing $2 billion a year to operate, what further
    benchmarks are there in the future to validate the operational
    capability of the program? What challenges still lie ahead?
        General Obering. In partnership with DOT&E and the warfighters, MDA
    continues to test the operational capability of the BMDS using a
    campaign of digital simulation, ground tests (Hardware-in-the-Loop) and
    flight tests. Our test program characterizes existing fielded
    capability, integrates and demonstrates new capabilities, and allows
    warfighters to test and validate their tactics, techniques, and
    procedures in a near-operational environment.
        In the first category of characterizing existing fielded
    capability, MDA's fiscal year 2007 test program will demonstrate
    (benchmark) the BMDS:

             GMD end-to-end intercept engagement that uses the operational
            system hardware and software;
             Aegis BMD's operational capability as both a sensor
            supporting homeland defense and its engagement capability to
            defend deployed forces, friends and allies;
             Deployed AN/TYP-2 X-band radar (formerly Forward Based X-band
            Radar) at Shariki, Japan, to support defense of the homeland,
            our deployed forces and the country of Japan;
             Integrated capability of the SBX radar to support homeland
            defense against missile attack from North Korea;
             Defense of Fylingdales Upgraded Early Warning Radar against a
            possible Iranian missile attack.

        In 2008 MDA will begin testing the THAAD element of BMDS in its
    fielded configuration, testing advanced discrimination algorithms for
    our forward-based radars, software upgrades to the BMDS Battle
    Management and GMD components to optimally use multiple sensor data
    inputs, and a new capability to concurrently perform developmental
    tests, operator training, and maintain an operational capability. As
    the BMDS continues to grow in complexity and inventory with additional
    operating locations for sensors and shooters and an evolving threat,
    the MDA test program will keep pace through a disciplined process that
    validates fielded capability and provides the data needed to guide the
    continued development of our capability to defend against ballistic
    missile attack.
        The magnitude of managing a complex test program and integrating
    the operational components into the BMDS is the MDA's greatest
    challenge. Years before the actual test can take place each test must
    be planned both at the Element level and the BMDS level: target
    requirements must be developed and targets must be procured, test
    objectives must be defined and the test itself must be designed with
    pre-test analysis performed by a dedicated test organization composed
    of system and test engineers. In conjunction, current year test
    programs must be conducted and the results analyzed and compared with
    system specifications. Based on the analysis, decisions on possible
    system changes must be made and the information on the operating BMDS
    passed to the warfighter. The MDA has developed an effective process
    that enables efficient management of the established benchmarks that
    will validate the operational capability of the program.

        55. Senator Pryor. General Obering, on March 15, a modified Boeing
    747-400F carrying a YAL-1A Airborne Laser (ABL) successfully test fired
    its target illuminator laser against a NC-135E test aircraft, verifying
    its ability to identify, track, and intercept an airborne target in the
    boost phase of flight. Could you better clarify this boost phase
    defense segment?
        General Obering. The ABL is the primary Boost Defense Segment of
    the MDA's integrated and layered BMDS. The MDA will design, build, and
    test an air-based laser system to acquire, track, and kill ballistic
    missiles during the boost phase of missile flight. The boost phase
    typically includes the first 60-300 seconds of missile flight and
    concludes at altitudes between 20-450 kilometers.
        Adding the ABL to the BMDS significantly increases the overall
    defensive capability by reducing the number of targets faced by
    successive defenders and by addressing certain threats that may be
    difficult to counter. By destroying the missile in boost ABL also
    negates the threat prior to their ability to deploy multiple reentry
    vehicles, submunitions, or countermeasures. Additionally, warheads and
    engagement debris do not reach the intended target areas. Furthermore,
    there is a high probability that the threat missile debris will fall
    within the hostile country's own territory, serving as a deterrent and
    reducing the possible affect the debris has on protected areas and
    assets.
        Secondary missions, for an operational ABL, will be to provide
    additional threat protection through early ballistic missile launch
    warning, launch site prediction, cueing to BMDS, and impact point
    prediction. Detecting and tracking a missile during its boost phase
    significantly improves accurate estimation of the launch point location
    and therefore will enhance the probability of a successful
    counterstrike against an aggressor's missile launchers. ABL's sensor
    capabilities further increase the robustness of the BMDS by enhancing
    the performance of other elements.
        In addition, the unique, revolutionary capabilities of ABL's
    mobility and speed-of-light directed energy weapon present adversaries
    with additional complexities when trying to develop or employ threat
    missile countermeasures that will provide a credible deterrent and a
    lethal defense against a rapidly evolving ballistic missile threat. ABL
    adds unique deployment flexibility to quickly deploy to areas of
    interest arriving in theater ready to provide an initial deterrent and
    defensive capability for the United States and/or allied forces.
    Without ABL, MDA would have to address in much less viable ways both
    the further proliferation of threats that is expected and the likely
    adversary counters to the other BMDS elements.

        56. Senator Pryor. General Obering, how does a 747-400F tactically
    anticipate and respond to an adversarial launch?
        General Obering. The ABL responds to an adversarial launch by
    detecting the launch with its on-board Infrared Search and Track (IRST)
    sensors, autonomously or with the assistance of cues from other BMDS
    sensors (e.g., satellites). The IRSTs detect the unique heat signatures
    emitted by the exhaust plumes of boosting missiles, and provide the
    information needed to point the turret and engage the threat missile
    with its High-Energy Laser. ABL is able to operate autonomously,
    however in normal operation it will interact with C2BMC, which will
    determine which shots are to be taken by ABL. ABL's concept of
    operations involves flying a combat air patrol pattern near a
    predetermined area of interest, detecting threat launches anywhere
    within its 360-degree field of regard, and rapidly engaging and
    destroying threat missiles. In addition, ABL's forward-deployed
    location will allow it to provide critical early launch warning to the
    rest of the BMDS.

        57. Senator Pryor. General Obering, what significance does this
    test have on the overall missile defense program?
        General Obering. This test was part of a critical series of in-
    flight tests of the ABL's laser targeting system and showed ABL's
    ability to identify, track and lock onto an airborne target precisely
    enough to hit it with the Tracking Illuminator Laser (TILL). The TILL
    is a kilowatt-class solid-state laser that is intended to track a
    boosting ballistic missile and identify the most vulnerable location on
    the missile in preparation for the eventual firing of the High Energy
    Laser, which will use directed energy to burn through the rocket motor
    case of a hostile missile.
        This test was an important step toward our next goal of determining
    atmospheric distortion between ABL and the target, compensating for
    that distortion, and engaging the target with a Surrogate High Energy
    Laser by this summer. In terms of the entire missile defense program,
    adding the ABL to the Boost Defense Segment of the BMDS significantly
    increases the overall defensive capability of the BMDS by reducing the
    number of targets faced by successive defenders and by addressing
    certain threats that may be difficult to counter during later stages of
    flight. Moreover an operational ABL, will be able to provide additional
    threat protection through early ballistic missile launch warning,
    launch site prediction, cueing to BMDS, and impact point prediction.
    Detecting and tracking a missile during its boost phase significantly
    improves accurate estimation of the launch point location and therefore
    will enhance the probability of a successful counterstrike against an
    aggressor's missile launchers. ABL's sensor capabilities further
    increase the robustness of the BMDS by enhancing the performance of
    other elements.

        58. Senator Pryor. General Obering, the PAC-3 surface-to-air
    missile is manufactured at the world class, highly-automated production
    plant in Camden, Arkansas. In 2006, this facility won the Arkansas
    Institute for Performance Excellence Governors Award and was named one
    of the ``10 best'' plants in America for its outstanding track record
    of on-time, on-budget deliveries of quality systems. What significance
    has the PAC-3 had on the Integrated BMDS and how important is the PAC-3
    manufacturing and depot facility in Camden?
        General Obering. I will defer to the Army to address the importance
    of the PAC-3 manufacturing and depot facility in Camden. My role is to
    manage configuration updates to ensure they are fully integrated and
    interoperable with the BMDS.
        As a fielded system, PAC-3 is already a significant contributor to
    the protection of U.S. Forces, friends and allies for the Combatant
    Commanders. In the future, we expect the Army's PAC-3 to continue these
    roles as other systems introduce additional layers of protection to our
    integrated BMD.

        59. Senator Pryor. General Obering, on January 11 of this year,
    China launched a successful strike against its own Feng Yun (FY-1C)
    polar orbit weather satellite using a Kinetic Energy Anti-Satellite
    weapon. What impact has this action made on our strategic capabilities
    posture?
        General Obering. [Deleted.]

                        PROTECTION FROM THEATER THREATS

        60. Senator Pryor. General Campbell, in your statement you note
    that ``Operation Enduring Freedom and Operation Iraqi Freedom are
    consuming key missile defense capabilities, leaving other worldwide
    commitments under-resourced.'' What steps are we taking to ensure the
    U.S. homeland and our troops deployed in combat are protected from
    theater air and missile threats?
        General Campbell. The MDA has increased fielding of GBIs in Alaska
    and other capabilities, and is developing a European-based capability.
    For deployed forces, Strategic Command provides input to the Global
    Force Management Board to optimize distribution of limited air and
    missile defense forces around the globe. Of course, we understand that
    the threat to the homeland is from long range or intercontinental
    missiles, while our deployed soldiers are facing threats from short or
    intermediate range missiles. The systems we have deployed are effective
    against these particular threats. We are continuing to evolve our
    existing systems and field new systems such as the Terminal High
    Altitude Area Defense (THAAD) which will enhance our capabilities
    against the full range of missile threats.

                 INTELLIGENCE, SURVEILLANCE, AND RECONNAISSANCE

        61. Senator Pryor. General Campbell, what are your thoughts on our
    functional components for intelligence, surveillance, and
    reconnaissance (ISR)? Do we have adequate ISR ground, naval, and
    airborne platforms supporting the global war on terrorism and
    intelligence gathering efforts worldwide?
        General Campbell. As a Department, we effectively meet less than
    one third of our combatant commanders' warfighter information needs. We
    do not have sufficient capabilities or capacity to meet the Nation's
    demand for intelligence. There are two ways to approach this. First,
    better integrated and focused investments to alleviate gaps and
    shortfalls in ISR near- and far-term. Today we face adversaries who
    avoid our strengths and seek to attack through nontraditional means.
    The current ISR enterprise, designed to confront the former Soviet
    Union and the Warsaw Pact, isn't optimized for either collection
    against, or analysis of, these new adversaries. Second, assess how we
    as a nation are running the ISR Enterprise today and aggressively make
    the changes required to improve efficiency and effectiveness.

                             DETERRENCE CAPABILITY

        62. Senator Pryor. Mr. Green, our Nation's global deterrence
    capability enables the United States to have decisive kinetic combat
    effects through the application of worldwide space and global strike
    operations. Meanwhile, the threat of global terrorism, highlighted by
    ballistic missile proliferation from countries like North Korea and
    Iran, poses a great challenge to our national security. With the threat
    from the numbers and capabilities of ballistic missiles increasing,
    what is our overall strategy to defend and counter this proliferation?
        Mr. Green. The U.S. Government has a number of initiatives underway
    to halt or counter the proliferation of ballistic missiles. We use
    multilateral frameworks, such as the Missile Technology Control Regime,
    to prevent the proliferation of ballistic missile technology. We also
    apply rigorous export controls and, where necessary, sanctions to keep
    ballistic missiles out of the hands of dangerous regimes. We place a
    high priority on dissuading or stopping potential adversaries from
    obtaining ballistic missile technology in the first place.
        Should regimes evade our efforts, we rely on the full array of
    deterrent capabilities, including missile defenses. Missile defenses
    devalue an adversary's investment in ballistic missiles and complicate
    the enemy's strategic calculations by increasing the uncertainty that a
    ballistic missile attack will be successful. When combined with U.S.
    offensive strike capabilities, U.S. leaders have a range of options for
    deterring, defending against and defeating potential missile attacks.
                                   __________
                  Question Submitted by Senator Jeff Sessions

                 MISSILE DEFENSE TESTING AND CONTINUED FIELDING

        63. Senator Sessions. Dr. McQueary, MDA plans to emplace four new
    GBIs in fiscal year 2008, and six new interceptors each year from
    fiscal year 2009 through fiscal year 2012. Based on your assessment of
    the testing program thus far, is there any reason why these GBI
    emplacements should not go forward?
        Dr. McQueary. There is obvious risk in producing new interceptors
    while the test program is ongoing. Following the two consecutive GMD
    flight test failures in December 2004 and February 2005, General
    Obering stopped testing and fielding until the results of several
    independent reviews he commissioned were complete. He then adopted a
    deliberate ``test-analyze-fix-test'' philosophy that I fully support.
    Although the August 2006 GMD flight test was a success, it is only one
    test. Repeatability is a very important element of a successful
    program. The next two GMD flight tests, if successful, will bolster my
    confidence that GMD can repeatedly demonstrate capability in
    increasingly more demanding scenarios. At this time, I see no reason to
    stop emplacing interceptors at Fort Greely or Vandenberg AFB.

        [Whereupon, at 5:01 p.m., the subcommittee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2008

                                  ----------

                            THURSDAY, APRIL 19, 2007

                                   U.S. Senate,
                      Subcommittee on Strategic Forces,
                                   Committee on Armed Services,
                                                        Washington, DC.

                            MILITARY SPACE PROGRAMS

        The subcommittee met, pursuant to notice, at 2:30 p.m. in
    room SR-232A, Russell Senate Office Building, Senator Bill
    Nelson (chairman of the subcommittee) presiding.
        Committee members present: Senators Bill Nelson, Inhofe,
    Sessions, and Thune.
        Majority staff member present: Madelyn R. Creedon, counsel.
        Minority staff member present: Robert M. Soofer,
    professional staff member.
        Staff assistants present: Kevin A. Cronin and Micah H.
    Harris.
        Committee members' assistants present: Clyde A. Taylor IV,
    assistant to Senator Chambliss; and Stuart C. Mallory and Jason
    Van Beek, assistants to Senator Thune.

           OPENING STATEMENT OF SENATOR BILL NELSON, CHAIRMAN

        Senator Bill Nelson. Good afternoon, thank you for coming.
    We have a number of witness so I'm going to make some very
    brief remarks, and when Senator Sessions gets here, I will
    interrupt the proceedings and ask him to make his comments.
        We are here on the occasion that the Department of Defense
    (DOD) certainly relies on a lot of space systems. We're in the
    process of modernization and replacement and it is putting a
    strain on the budget as well as the technical and management
    skills of the Services and the contractors. While some of these
    programs have made progress in resolving some of the schedule
    and budget issues, a lot of work remains. So we want to dig
    into that.
        We have a star-studded cast, literally and figuratively.
    I'm just going to curtail my comments there. I will interrupt
    when Senator Sessions gets here, but your statements will be
    made a part of the record. What I would like to do, instead of
    your reading a statement to me, which we can, of course, read
    that for ourselves, is to have a conversation.
        [The prepared statement of Senator Bill Nelson follows:]

                   Prepared Statement by Senator Bill Nelson

        Good afternoon and welcome to the Strategic Forces Subcommittee
    hearing on military space systems. We have an excellent panel of
    witnesses today, Dr. Sega, Under Secretary of the Air Force and the
    Executive Agent for Space for the Department of Defense (DOD); General
    Chilton, Commander, Air Force Space Command; General Shelton,
    Commander, Joint Forces Component Command for Space, U.S. Strategic
    Command; Vice Admiral McArthur, Commander, Navy Network Warfare
    Command; and Cristina Chaplain from the Government Accountability
    Office. Thank you all for being here. We look forward to a good
    discussion of military space programs.
        DOD is heavily reliant on space systems, as is the United States in
    general. Currently, all of the DOD military space systems are in the
    process of modernization and replacement, which is putting a strain on
    the budget as well as the technical and management skills of the
    Services and the contractors. While some of these programs have made
    progress resolving some of the schedule and budget issues, a lot of
    work remains, particularly in technically challenging programs such as
    T-sat. On the other hand, there is good progress in the Operationally
    Responsive Space program and even the Space-Based Infrared Satellite
    program.
        Programs dealing with space situational awareness, an area
    generally under-appreciated and perpetually under-funded, are back in
    the spotlight as a result of the Chinese test of a kinetic anti-
    satellite weapon. While it is it not clear if China will or will not
    deploy such a weapon, the test, which created thousands of pieces of
    space debris, was at a minimum, a loud wake-up call.
        Another critical element of the national security space programs is
    space launch. It is important that we continue to maintain and
    modernize the launch ranges to ensure reliable access to space.
        We have a large number of witnesses this afternoon and you all have
    submitted prepared statements, which, without objection, will be
    included for the record. In order to make the best use of our time I
    will limit my opening remarks and now turn to Senator Sessions for any
    opening remarks that he may have.

        Senator Bill Nelson. So, Mr. Secretary, we'll start with
    you.

     STATEMENT OF HON. RONALD M. SEGA, UNDER SECRETARY OF THE AIR
                                 FORCE

        Dr. Sega. I'm appearing before you today as both the Under
    Secretary of the Air Force and the Executive Agent for Space.
        When we talked last year, we talked about three themes that
    we were going to work on: integration across space, as well as
    across functions and organizations, not only within the DOD,
    but with agencies outside, as well as industry, universities,
    and Congress. We also talked about a back-to-basics approach
    toward acquisition and a block approach to organize ourselves
    so that we would be reducing risk in our acquisition programs
    to deliver to the warfighter on time and on cost. The third
    area was workforce.
        In addition to that, I want to talk a little bit about
    continuity of service that we think is very, very important for
    several of the activities we're engaged in. One of those is
    missile warning. We can not afford to have a gap in our sensing
    capability for missile warning for the United States. The
    second is strategic communications. The third is position,
    navigation, and timing--our Global Positioning System (GPS).
        We've also endeavored to increase our activities as we go
    forward in both space situational awareness and operationally
    responsive space (ORS), and recall, and I'll refer to this
    chart in the back, how we have organized.
        As we look at the acquisition process, we're looking at it
    in four stages. At the top of the charts is our System
    Production Stage. There, we are lowering the risk, shortening
    the acquisition cycle-time that is indicated by these arrows
    block one to block two, et cetera, we go horizontally.
        The next generation out from that is Systems Development.
    We want to be maturing the technology so when it reaches the
    System Production phase, it is mature; do the systems
    engineering correctly; look at the requirements--make sure they
    are identified clearly; apply the resources; and then, go from
    there. One generation still further out is Technology
    Development, and one further out, is Science and Technology.
        As an example of how we would go through this: in our
    budget, we have submitted GPS III for funding throughout the
    Future Years Defense Program (FYDP). GPS IIIA follows on GPS
    IIF. It enhances the capability in two major ways: one is
    adding a new frequency, L1C, for the civil community and
    something our Nation says we're going to do--it's also
    compatible with Galileo. It also adds additional power that our
    warfighters, through the Joint Requirements Oversight Council
    (JROC), say is very important. So, we will have 10 times the
    power over our GPS IIF signal strength in GPS IIIA.
        We're also anticipating where we need to go for IIIB and
    IIIC. We're adding a growth-path requirement into the building
    of IIIA. This has been done through the JROC process. We
    understand the requirements--the technologies are matured--and
    we're going forward on IIIA.
        Along with that, we want to be anticipating IIIB. The major
    piece of technology and capability for IIIB is cross-links--
    higher rate cross-links that tie the system together to improve
    accuracy. So, we need to be working on that in a systems
    development phase, and bring that to at least a TRL Level 6
    capability.
        We also know, after IIIB, that we're going to be looking at
    IIIC. That would include a spot beam, but that's less mature at
    this time. We need to be working on the technology development
    for a spot beam, so in time, it moves up to Systems Development
    and finally can add to the GPS capability and become GPS IIIC.
    We're investing in science and technology (S&T) in such things
    as advanced clocks for our GPS system.
        So, we have an ``investment portfolio'' established, not
    only in what we are building today, but also in what we have in
    the future to continue to enhance the capability. That's
    consistent with the rate of change of the 21st century--
    continuing to bring on technology improvements for the new
    needs of the warfighter. But, it will be done in blocks. It is
    a more disciplined approach, requiring more adherence to
    systems engineering, and to standards. Our folks are more in
    plant now and working with the user from day one. So, that's
    how this back-to-basics and block approach works for the GPS
    III satellite.
        If we go on to the Space-Based Infrared System (SBIRS)
    Satellite that supports missile warning--we need a continuity
    of service capability plan for warning. After we complete the
    SBIRS Geo-satellite--what is next? In our budget is the
    Alternative Infrared Satellite System (AIRSS). Focal plane
    technology is increasing, it's the 21st century way of staring
    and getting the information from space in the infrared spectrum
    we need. This information supports not only missile warning,
    but also missile defense, technical intelligence, and battle-
    space characterization. So, that's why we have AIRSS also in
    the budget, as well as SBIRS GEO.
        This last year, we were pleased to report the SBIRS HEO
    payload was on orbit and exceeding our expectations. That's
    been a good thing.
        We're also focusing on mission assurance from day one. One
    example of that is launch. On March 8, we witnessed our 50th
    consecutive, successful, medium or heavy national security
    launch--a great job from the team that has put that together.
    But, for each one, we have to keep our eye on the ball and make
    sure attention to detail is maintained.
        I do want to highlight for that particular launch, there
    were five firsts. Not only was it the 50th, but it was the
    first Air Force and DOD Atlas V mission; the first multiple
    payload mission; the first Centaur-3 burn mission; first flight
    of the Evolved Expendable Launch Vehicle (EELV) secondary
    payload adapter, allowing smaller satellites the opportunity to
    fly; and the first flight of a dual orbit trajectory that went
    off first at 44 degrees inclination and then over to 35 degrees
    inclination. So, I really think that's important.
        The final point is that of workforce. We put forward a
    National Defense Education Program 3 years ago. We doubled the
    money that was in that last year and we ask, once again, to
    double the funds this year. This program focuses on science,
    math, engineering, and some foreign language for the critical
    skills that we need for clearable people. So, its focus is on
    the pipeline coming forward.
        General Chilton and company have worked hard on the
    National Security Space Institute (NSSI), which you may hear
    about later. Our workforce is key and foundational to us being
    successful going forward. I just want to thank this committee
    for your support of what we're doing in National Security
    Space.
        [The prepared statement of Dr. Sega follows:]

                   Prepared Statement by Hon. Ronald M. Sega

                                  INTRODUCTION

        It is an honor to appear before this committee as the Under
    Secretary of the Air Force and the Department of Defense (DOD)
    Executive Agent for Space, and discuss with you our National Security
    Space (NSS) activities. As the DOD Executive Agent for Space, my role
    is to ``develop, coordinate, and integrate plans and programs for space
    systems and the acquisition of DOD space Major Defense Acquisition
    Programs to provide operational space force capabilities to ensure the
    United States has the space power to achieve its national security
    objectives.''
        On August 31, 2006, the President signed a new National Space
    Policy, which highlights the importance of space to the Nation and
    presents goals for our country's space activities. Today, I would like
    to discuss the importance of space to our warfighters; the progress
    that we have made over the last year; and some of our future plans for
    DOD space programs. One key tenet, which you will see throughout this
    testimony, is that we must ensure the continuity of service of several
    key capabilities, such as: Strategic Communications; Missile Warning;
    and Position, Navigation, and Timing. Last year, we presented three key
    areas of emphasis that remain the focus of our space activities:
    integration across NSS as well as with air, land, sea, and cyberspace;
    getting ``Back to Basics'' in our approach to space acquisition; and
    the importance of ensuring the viability and proficiency of our space
    professionals and science and engineering workforce. Over the last
    year, we have made progress in these three focus areas and are starting
    to see the benefits of this approach.
        The U.S. relies upon space capabilities not only to meet the needs
    of Joint operations worldwide, but to support our Nation's diplomatic,
    informational, and economic efforts as well. Because of this, it is
    important that NSS and our space professionals are integrated into all
    aspects of peacetime and wartime operations--providing robust and
    responsive space capabilities around the globe. At the tactical level,
    space is also playing a crucial role; for example, during Search and
    Rescue missions, U.S. Air Force, Army, and some Navy personnel in
    theater are using Combat Survivor Evader Locator radios, incorporating
    global positioning system (GPS) and satellite communications (SATCOM).
        Government and commercial communications satellites are also
    providing direct support to our warfighting forces. Our most recent
    data shows commercial vendors are providing over 80 percent of the
    SATCOM used in U.S. Central Command's area of responsibility. Though
    transparent to many, space capabilities continue to make a difference
    in Iraq, Afghanistan, and around the world.
        America's citizens also rely on the access and use of space
    capabilities in many areas of everyday life. From our banks and
    financial institutions employing GPS timing to synchronize their
    encrypted computer networks to forecasting severe weather, America is
    increasingly dependent on capabilities from space. The space community
    continues to provide continuity of service in key areas, while
    simultaneously working to modernize and recapitalize our aging space
    fleet and infrastructure. Today, we do not have the luxury of
    ``depots'' to upgrade and maintain our space systems the way our air
    and ground forces do. Thus, in order to maintain our space
    capabilities, we must replace the aging systems and upgrade with new
    systems.
        Globally, the rate of change of technology in the 21st century and
    the number of nations directly engaged in space continues to increase.
    The capacity to contest space operations and capabilities is also
    growing. Space can no longer be considered a ``safe haven'' or
    ``sanctuary.'' The recent foreign testing of a kinetic anti-satellite
    (ASAT) weapon demonstrated an ability to challenge, disrupt, or destroy
    space assets and capabilities. This testing has also raised global
    concerns over space debris and this debris' potential to collide with
    space assets in, or traversing through, Low Earth Orbit. Thus, space
    situational awareness (SSA) has become increasingly important, enabling
    us to gain a better understanding of activity in space; and we must
    continue to work on protection for our space capabilities in a
    potentially hostile environment.
        We must also continue to emphasize integration, ``Back to Basics''
    acquisition and workforce development. Before updating you on these
    three initiatives, I want to share some progress the NSS community has
    made over the last year.

                                UPDATE ON SPACE

        In addition to implementing ``Back to Basics'' reforms, several
    achievements occurred across the DOD space portfolio over the last
    year.
    Launch
        On March 8, 2007, we accomplished our 50th consecutive, successful
    NSS operational launch--a national record. This event was also the 15th
    successful operational launch of an evolved expendable launch vehicle
    booster. We need to remember, however, that this remarkable achievement
    is only possible due to our continuing commitment to Mission Assurance,
    and exacting attention to detail.
    Missile Warning
        Over the last year, we also made significant progress on the Space
    Based Infrared System (SBIRS) program, which supports four mission
    areas: missile warning, missile defense, technical intelligence, and
    battlespace awareness. The first Highly Elliptical Orbit-1 SBIRS
    payload was successfully launched last year, and it has met or exceeded
    all on-orbit performance expectations. Several key tests were also
    conducted on the first SBIRS Geosynchronous Earth Orbit (GEO-1) payload
    and spacecraft, in preparation for launch in 2008. Our funding request
    allows the procurement of the first two GEO spacecraft plus the
    necessary long lead items for a potential third GEO spacecraft, two
    additional hosted SBIRS sensors in Highly Elliptical Orbit, plus the
    necessary ground elements.
    Communications
        We are moving ahead with near-term improvements to our SATCOM
    capabilities. The first Wideband Global SATCOM (WGS) space vehicle (SV)
    completed final assembly and integration and most of the system level
    testing required in preparation for launch, projected for summer 2007.
    In February 2006, the Air Force awarded a contract for the second block
    (Block II) of WGS satellites (SVs 4-5), with even higher bandwidth/
    throughput than the Block I satellites (SVs 1-3). The Advanced
    Extremely High Frequency program, the follow-on to MILSTAR,
    successfully completed its first end-to-end communication test with
    legacy MILSTAR terminals in June 2006, and is on track for first launch
    in 2008. Also, the Transformational SATCOMs (TSAT) program continued to
    mature key technologies with both contractors passing independent
    evaluations.
    Position, Navigation, and Timing
        Two GPS IIR-M satellites were successfully launched in 2006,
    bringing us to three GPS IIR-Ms now on orbit. These satellites provide
    a new military signal (M-Code), which is more resistant to jamming, and
    a new civil signal (L2C). After the remaining five GPS IIR-M satellites
    are launched, we will begin to launch the GPS IIF series of twelve
    satellites, which are all now under contract, following a thorough
    Integrated Baseline Review last year.
    Operationally Responsive Space
        In 2006, the Air Force established the new Space Development and
    Test Wing, headquartered at Kirtland Air Force Base (AFB), New Mexico,
    located next to the Air Force Research Lab's Space Vehicles
    Directorate, to focus on the development and testing of smaller
    satellites/orbital assets, with the goal of increasing innovation and
    speed, to rapidly transition ideas to fielded capabilities. One of the
    Wing's key responsibilities is support of the Operationally Responsive
    Space (ORS) effort. This ORS focus includes the ability to launch,
    activate, and employ low-cost, militarily useful satellites to provide
    surge capability, reconstitute or augment existing constellations, or
    provide timely availability of tailored or new capabilities.

                                  INTEGRATION

        We continue to emphasize integration and collaboration across the
    NSS community; across functional areas such as intelligence,
    surveillance, and reconnaissance (ISR); and among DOD entities, other
    government agencies, industry, academia, and Congress. Integrating
    architectures also become increasingly important as systems become more
    capable of dynamic tasking and mutual cueing, and protection of our
    space capabilities become even more important.
        Last year, the Air Force and the National Reconnaissance Office
    (NRO) signed an agreement, which established new personnel policies and
    mechanisms for better developing and managing Air Force space
    professionals. Subsequently, an Air Force Major General was assigned as
    the Deputy Director of the NRO, while retaining Program Executive
    Officer responsibilities for space radar under the Air Force
    Acquisition Executive for Space. A new NRO position was also
    established, as the Deputy Director of Air, Space, and Information
    Operations at Air Force Space Command.
        The Space Partnership Council, with membership from organizations
    across the national security and civil space communities, is helping to
    share best practices, avoid duplication, and support integration of
    space activities. For example, last year we agreed to establish a GPS
    Metric Tracking requirement for launches from both the eastern and
    western launch ranges beginning January 1, 2011.
        Additionally, on July 19, 2006, U.S. Strategic Command announced
    the establishment of the Joint Functional Component Command for Space,
    headed by the 14th Air Force Commander at Vandenberg AFB. This action
    provides a single commander, with a global perspective, enhancing
    functional integration for the command and control of the Nation's
    space-based assets.
        Our acquisition approach also emphasizes integration and
    collaboration among interested parties in all stages of the acquisition
    process. Our goal is to create partnerships within the space community,
    which are critical to this community's success. The military should
    provide well-coordinated requirements, vetted through operators,
    acquirers, and logisticians. The government acquisition community,
    working with industry, must assure that technology is mature and that
    systems engineering and manufacturing capabilities are in place to
    deliver requirements--on cost and on schedule--with appropriate funding
    stability. A military-industry-congressional partnership is also
    essential.
        Over the last year, we have facilitated collaboration between Air
    Force product centers and laboratories with the establishment of the
    Space and Missile Systems Center's Space Development and Test Wing,
    located just across the street from the Space Vehicles Laboratory on
    Kirtland AFB, New Mexico, as mentioned previously. Additionally, one
    recent collaborative effort involved the Air Force, Army, Navy, and
    National Aeronautics and Space Administration (NASA) working closely to
    develop and launch the ``TacSat'' Experimental Satellite (TacSat-2)
    last December from the NASA facility on Wallops Island, Virginia.

                    ``BACK TO BASICS'' IN SPACE ACQUISITION

        We continue to refine and implement the ``Back to Basics''
    initiative that we discussed last year, and it remains a key element of
    our plan to improve space acquisition. This initiative promotes a
    renewed emphasis on increased discipline in the development and
    stabilization of requirements and resources; engineering practices; and
    management, as well as a more deliberate acquisition planning strategy.
    We have established a goal of funding to a cost estimate at the 80
    percent confidence level, to help ensure space program success.
        This ``Back to Basics'' approach focuses on ``mission success'' in
    our space acquisition programs. ``Acquisition'' links technology with
    operations--turning ideas into real, tangible items and delivering
    those items to the field. It can be viewed as a continuous process with
    four distinct but interrelated stages. The first stage is science and
    technology (S&T), where we conduct basic research and explore the
    possibilities of new technologies. In the second, Technology
    Development, we evaluate the utility of discoveries made in the S&T
    stage. The third stage is Systems Development. Here, we take the most
    promising technologies and mature them to higher readiness levels so
    they can be integrated into operational platforms in the fourth stage,
    System Production. Thus, technology is matured through the four stages
    to move from the lab bench, to the test range, to operations. We are
    emphasizing early technology development to ensure mature technology is
    available for our production systems.
        For most space systems, the ``Back to Basics'' approach will be
    implemented using a block approach acquisition strategy that is focused
    on delivering capability through discrete, value-added increments. This
    concept is consistent with current policy specifying ``evolutionary
    acquisition as the preferred strategy'' for DOD acquisitions. Specific
    capability increments are based on a balance of capability, delivery
    timeline, technology maturity, risk, and budget. Well-defined
    increments help reduce many of the potential instabilities in
    requirements, budget, and workforce. An overarching goal is increased
    confidence, both in terms cost and schedule, for our space acquisition
    programs.
        Though ``Back to Basics'' is not a quick-fix solution to space
    acquisition, we have begun to realize the benefits of using this
    approach. Adhering to its key principles (e.g., systems engineering;
    proper management of requirements, risks, and resources) yields
    dividends, but this is a continuing process that requires our continued
    commitment. In the fiscal year 2007 President's budget request, the Air
    Force applied the block approach to the TSAT program, which is critical
    to maintaining continuity of service in Strategic Communications. The
    ``Back to Basics'' philosophy and block approach are also now being
    applied to several other needed capabilities: Missile Warning systems
    (e.g., SBIRS and the Alternative Infrared Satellite System (AIRSS));
    SSA (e.g., Space-Based Surveillance System (SBSS)); and Position,
    Navigation, and Timing (e.g., GPS III). Thus, programs with defined,
    executable block strategies should reduce production risk, deliver
    incremental capabilities to the warfighter sooner, and maintain
    continuity of service.
    Missile Warning
        Space-based infrared sensing capability (e.g., missile warning,
    missile defense, technical intelligence, and battlespace
    characterization) remains a critical requirement. In addition to the
    current SBIRS-High program previously mentioned, we are working on an
    AIRSS. AIRSS is a critical program for developing a range of options to
    ensure the Nation's missile warning capability is both sustainable and
    responsive. AIRSS is developing Wide Field-of-View (WFOV) focal plane
    array-based options for the ``SBIRS-type'' missions. The technical
    progress on the basic elements of this program would provide confidence
    that a near-term WFOV option could be made available and, with further
    development of this technology, could reduce cost and improve
    performance for the next generation missile warning system after SBIRS-
    High.
        Ensuring technology maturation occurs before transitioning from
    development to production is a key part of the ``Back to Basics''
    philosophy. Entering a system production phase with mature technology
    reduces schedule and cost risk, puts needed capability into the
    warfighters' hands sooner, and ensures we deliver what we promise on
    schedule, supporting continuity of service. Each operational capability
    area, such as missile warning, should have an investment strategy and
    portfolio that goes beyond the current program of record, to include
    needed work to support successive generations of technical capability,
    both for space and ground elements.
    Communications
        Last year, we also applied the ``Back to Basics'' approach to
    Strategic Communications programs, particularly for the
    Transformational Communications Architecture (TCA) and the TSAT
    program. The TCA supports interoperability through the use of community
    standards and is comprised of four segments: space vehicles, terminals,
    terrestrial infrastructure, and network management & operations.
        TSAT will provide internet protocol-based communications with laser
    crosslinks in space, and extend the Global Information Grid to deployed
    and mobile users, providing internet-like connectivity. The first TSAT
    satellite launch is now scheduled for 2016, which will maintain
    continuity of communications support to strategic users and meet the
    warfighters' needs during the transition to net-centric operations.
    Position, Navigation, and Timing
        Continuity of position, navigation, and timing (PNT) capability is
    critical for military, civil, and commercial applications, and GPS is
    the world's standard for space-based PNT. Using GPS, military and
    civilian users can access highly accurate, real-time, all-weather,
    position, navigation, and timing data--24 hours a day, 7 days a week.
    Assured GPS capability is crucial to the success of many missions, from
    humanitarian relief to weapons employment, and the Air Force is
    committed to continuity of this critical service. To that end, we will
    continue to make improvements to the constellation; including new civil
    signals, more jam-resistant military code, new receivers, and increased
    accuracy. In 2006, interagency coordination was strengthened through an
    active national PNT Executive Committee (EXCOM), co-chaired by the
    Deputy Secretary of Defense and the Deputy Secretary of Transportation,
    and the stand-up of the National PNT Coordinating Office.
        The Air Force is meeting the warfighters' PNT needs through
    increased power and signal improvements to 8 GPS IIR-M satellites (3 on
    orbit and 5 awaiting launch), 12 GPS IIF satellites, their ground
    control system, and associated user equipment. Together, these actions
    will deliver higher power and improved anti-jam capability. At the same
    time, the Air Force is developing the GPS III satellites to continue to
    satisfy warfighter requirements in the future.
        Through a comprehensive review process and Joint Requirements
    Oversight Council (JROC) validation, GPS III requirements were
    developed, and include: increased power beyond GPS IIF, an L1C signal,
    enhanced crosslinks, and spot beam capability. These capabilities will
    enhance our current GPS capability, and we plan to deliver these
    capabilities incrementally. The first block, GPS IIIA, will incorporate
    GPS IIF capabilities plus a tenfold increase in signal power, a new L1C
    civil signal compatible with Galileo, and a growth path to future
    blocks. GPS IIIB will then incorporate enhanced crosslinks capability,
    and GPS IIIC will provide spot beam capability. In the case of GPS
    IIIA, we will carry both contractors through Key Decision Point B, so
    that we can leverage ongoing risk-reduction activities. The JROC
    validation of the GPS Block IIIA initial Capability Development
    Document addendum supports this block approach strategy for GPS III.
    Operationally Responsive Space
        ORS also utilizes the ``Back to Basics'' approach. As defined in
    this year's Air Force Posture Statement, ``ORS includes the ability to
    launch, activate and employ low-cost, militarily useful satellites to
    provide surge capability, reconstitute damaged or incapacitated
    satellites, or provide timely availability of tailored or new
    capabilities.'' A broader view of ORS is a tiered capability consisting
    of spacecraft, launch vehicles, and ground segment to deliver a range
    of space effects to the warfighter. Additionally, this broader view
    combines existing, ready-to-field, and emergent systems that are
    focused on reducing development and deployment costs and schedule. The
    fiscal year 2008 funding request for the ORS program element (narrower,
    small-satellite construct) supports an increased ability to transition
    rapidly from experiment to operational capability.
        Our first on orbit Tactical Satellite Experiment (TacSat-2) was
    successfully launched in December 2006, and two more experimental
    ``TacSats'' are planned for launch in 2007. The TacSat-2 satellite was
    developed quickly and cost effectively--carrying several experiments to
    test cutting-edge capabilities to support the warfighter. The TacSat-2
    team demonstrated ``responsive'' capabilities by efficiently
    integrating the satellite and launching on a Minotaur booster
    (Minuteman derivative) within 7 months of ordering the booster.
    Space Situational Awareness
        SSA includes systems such as the Rapid Attack Identification
    Detection and Reporting System (RAIDRS) program, the Space Fence, and
    SBSS.
        RAIDRS develops ground-based systems that rapidly detect, locate,
    characterize, identify, and report interference with DOD-owned and DOD-
    used space assets, and it is being developed via a block approach.
    Block 10 should provide initial capabilities in fiscal year 2007 that
    detect and geo-locate SATCOM interference via fixed and mobile ground
    systems, whereas Block 20 is planned to provide automated data access/
    analysis, data fusion, and decision support capabilities.
        The Space Fence is planned to replace the aging Air Force Space
    Surveillance System (AFSSS) with a system of three sites worldwide and
    use a higher radio frequency to detect and track smaller sized space
    objects. It would expand the terrestrial-based detection and tracking
    capability, supporting SSA while working in concert with other network
    sensors. A block approach acquisition strategy for the program will be
    developed in fiscal year 2007-2008 with a development contract to
    follow after a full and open competition.
        Building upon the success of the Space-Based Visible (SBV)
    technology demonstration, the Space-Based Surveillance System (SBSS)
    program is planned to deliver optical sensing satellites to search,
    detect, and track objects in earth orbit, particularly those in
    geosynchronous orbit. Surveillance from space will augment our ground
    sensors with 24-hour, all-weather search capability. SBSS is also being
    acquired via a block approach, with Block 10 to be fielded in fiscal
    year 2009 as a pathfinder capability to replace the aging SBV sensor.
    Block 20 is then scheduled to provide increased worldwide space
    surveillance.

             SPACE PROFESSIONALS/SCIENCE AND ENGINEERING WORKFORCE

        The foundation for our future space capability continues to be our
    space professionals in the military, civil service, and industry. Some
    of our experienced personnel will soon be eligible to retire, so we are
    working hard to attract and retain technically skilled people to ensure
    that the appropriate technical foundation and essential skill sets are
    available to accomplish our space missions. We are also working to
    develop better cross-functional assignment practices, to more
    effectively match individual competencies and experiences with position
    requirements.
        The importance of space as a force multiplier underscores the
    necessity to ensure we have a strong industrial base that will be able
    to satisfy our requirements, both now and in the future. The Space
    Industrial Base Council, co-chaired by Dr. Kerr and myself, is a forum
    to address space industry issues and bring together stakeholders from
    across government to provide coordinated attention and action on space
    industrial base issues. We have also taken steps to include industry
    and academia to help inform and implement our initiatives.
        Our focus has been to ensure that our space cadre is comprised of
    the most highly qualified personnel possible. The National Security
    Space Institute (NSSI) continues to be a DOD Center of Excellence for
    Space Education and serves a diverse multiservice and governmental
    agency population. Student capacity for the NSSI's Space ``200'' and
    ``300'' courses has also been expanded and work has begun on
    development of an additional Advanced Course for Military SATCOM.
    Additionally, the NSSI, Air Force Institute of Technology, Naval
    Postgraduate School, and other academic organizations continue to
    develop new Distance Learning courses, making coursework available to a
    larger audience, and allowing students to work and study
    simultaneously.
        The significance of having a high-quality workforce will only grow
    as the global development of space expands. Just as the block approach
    provides a path for the development and maturity of technology, it also
    provides the opportunity to develop our future space leaders through
    experience gained with increasingly complex systems. For example, by
    allowing hands-on experiences with ORS and small satellites, our people
    are rapidly gaining critical skills in building, launching, and
    operating spacecraft. These efforts help develop technical instincts,
    which should prove valuable in our space professionals' future
    endeavors, such as program management.
        The National Defense Education Program (NDEP) also continues to
    provide additional opportunities for scholarships in math, science,
    engineering, and foreign language, with a focus on critical skills for
    clearable people. The NDEP was funded at $10 million in fiscal year
    2006, $20 million in fiscal year 2007, and we are requesting $44
    million in fiscal year 2008. We are working with our laboratories and
    product centers to help sponsor the students and we ask for your
    continued support.

                                   CONCLUSION

        Our Nation depends on its space capabilities as an integral part of
    its military power, industrial capability, and economic vitality. We
    must continue to ensure continuity of services in critical areas such
    as Missile Warning, Strategic Communications, and Position, Navigation
    and Timing. We have continued to focus on: integration of America's
    space efforts; a ``Back to Basics'' approach to Space Acquisition; and
    a continuing emphasis on strengthening America's space professionals
    and our Science and Engineering workforce. Initial application of our
    strategy over the past year has shown promising results, as we continue
    toward securing our Nation's space capabilities for the future.
        I look forward to continuing to work with the committee and thank
    you for your continued support of NSS.

        Senator Bill Nelson. Thank you.
        General Chilton?

    STATEMENT OF GEN. KEVIN P. CHILTON, USAF, COMMANDER, AIR FORCE
                             SPACE COMMAND

        General Chilton. Thank you, Mr. Chairman, distinguished
    member of the subcommittee. I really appreciate the opportunity
    to appear before you today. It's a great opportunity.
        Senator Sessions, thank you as well. It's a privilege for
    me to be here, just to be here and visit with you all. But,
    also to represent the nearly 40,000 men and women of Air Force
    Space Command, who today are in the fight globally, supporting
    the global war on terror and also providing for the national
    security of this country, day-in and day-out. Those wonderful
    folks are out every day, 365 days a year, delivering critical
    space and nuclear deterrent capabilities to us.
        If I could share with you, just briefly, the four
    priorities that we have in Space Command that were the backbone
    for our program this year, and as we look to the future.
        First, we want to make sure that we preserve and expand the
    critical capabilities that we bring to the joint warfighter.
    Preserve means take care of what you have, fund it correctly,
    and develop the space situational awareness we know we will
    need for the future to preserve our capabilities. Expand was
    detailed by Dr. Sega, as we are recapitalizing, along with the
    Chief's vision, every single one of our key constellations in
    this program, I'm very proud of that.
        I don't think we can say it often enough, that we don't do
    things in space just for the Air Force. Everything we do is in
    support of the joint warfighter and I'm very proud of that.
        Our second priority is to make sure we provide a safe and
    secure nuclear deterrent for the United States of America. I
    tell my team, we juggle a lot of balls everyday, most of them
    are tennis balls. One of them is a crystal ball and that's our
    nuclear responsibilities. We cannot afford to take our eye off
    that ball or to drop it. We take it very seriously and you'll
    see that in the recapitalization and refurbishing of our
    Minuteman III fleet from nose cone to rocket nozzle. We're
    preparing to extend that fleet to 2030.
        The third priority for us is to make sure that we develop,
    mature, and field and sustain, on time and on cost, the
    capabilities we'll need for the future. In Air Force Space
    Command, we uniquely have the acquisition arm, the Space and
    Missile Center, out in Los Angeles assigned to this operational
    command. So, we take that responsibility very seriously. I'm
    proud to announce that General Hamel and his team out there
    have done a great job, I think, in turning the ship on
    acquisition for our space business. In fact, taking us where we
    need to go into the future.
        Last, but certainly not least, our priority is to make sure
    we attract, train, and retain the expertise we're going to need
    for the 21st century as we move forward into a more complicated
    environment in space and in warfighting. So, we're very focused
    through not only institutions like the NSSI, but we're taking a
    hard look at policies for recruiting. We're taking a hard look
    at how we raise people to key leadership positions for the
    future. We want to make sure we do that with malice and
    forethought, as we grow our space leaders within the Air Force
    for the future.
        These are our four priorities and they've shaped this
    budget submission to you.
        Again, sir, I thank you for the opportunity to be here and
    I look forward to your questions and questions from the
    subcommittee.
        Thank you very much.
        [The prepared statement of General Chilton follows:]

               Prepared Statement by Gen. Kevin P. Chilton, USAF

                                  INTRODUCTION

        Mr. Chairman and distinguished members of the subcommittee, it is a
    great privilege and an honor to appear before you today representing
    the nearly 40,000 men and women of Air Force Space Command (AFSPC).
    Thank you for your interest in and continued support of our Air Force's
    space capabilities. Your leadership has focused resources towards
    maintaining the asymmetric advantage that our airmen deliver to,
    through and from space to the joint fight. I am honored to share this
    stage with my distinguished colleagues, all great leaders of our
    National Security Space team.
        Today, I am pleased to report our United States Air Force's space
    capabilities have never been more impressive. Each day AFSPC airmen
    demonstrate they are the Nation's experts in operating our Air Force's
    space systems by providing critical support to every one of our
    combatant commanders in the form of Missile Warning; Missile Defense;
    Space Surveillance; Position, Navigation and Timing (PNT);
    Environmental Monitoring; Strategic Deterrence; Satellite
    Communications (SATCOMs), Space Launch and Counterspace capabilities.
    As we reflect on the contributions the airmen in AFSPC delivered over
    the past year, it is clear we are now operating in an era where space
    provides an unparalleled advantage for our armed forces.
        This unmatched advantage that enables our joint, interagency and
    coalition operations must be protected. For that reason, our Air Force
    has laid out a strategy to support recapitalization efforts, while
    assuming some risk in our operations, maintenance and personnel
    accounts. Just as our Chief of Staff, General Moseley, testified, ``Air
    Forces fail when they do not correct slowly declining relative
    capabilities.'' Our space capabilities are too integral to the fight to
    let our forces down . . . or let an adversary eclipse our advantage. We
    realize the importance of investing today to get what we need for
    tomorrow.
        This 2007 posture statement articulates our Nation's critical
    reliance on space capabilities. At the birth of our command 25 years
    ago, space capabilities were in their infancy. Today, combatant
    commanders depend on integrated space effects to successfully execute
    their missions. To keep our radar locked on meeting those growing
    demands, our command developed a vision and a set of four focused
    priorities through which we will achieve future success.

                             VISION AND PRIORITIES

        The foundation of our command was built by pioneers like the
    ``Father of Air Force Space,'' General ``Bennie'' Schriever and the
    first Commander of AFSPC, General James Hartinger. The long line of
    great leaders up through my predecessor, General Lance W. Lord, (Ret.),
    have all contributed to the success of our Nation's military space
    program today. Learning from our heritage, but with our eyes on the
    horizon, we crafted a vision that recognizes the important
    contributions of the past while also paving our path to future success.
    Our vision is to become the:

              Acknowledged Experts and Leaders in Fielding, Launching, and
            Employing Space Power for the 21st Century

        The space effects we provide to the combatant commanders are
    second-to-none, due in large part to the bank of knowledge and spirit
    of innovation that keeps AFSPC on the cusp of the technological bow
    wave. Our Nation's and our allies' armed forces, our private citizens
    and millions of people around the globe, benefit today from
    capabilities provided by AFSPC. Every thing we do in this command is
    focused on enabling the joint fight, to win the war we are in today,
    and just as importantly, to ensure we are prepared to win decisively in
    the future. Our active duty, Guard, Reserve, government service, and
    contractor team are the best in their fields, and we want to leave no
    doubt in anyone's mind: when you have a question about America's
    military space and missile capabilities, the nearly 40,000
    professionals of AFSPC hold the answer. To help make this vision a
    reality, we have crafted four strategic priorities:

              1. Preserve and Expand our Ability to Deliver Space Effects
            to the Joint Fight
              2. Provide Safe and Secure Strategic Deterrence
              3. Develop, Field, and Sustain Dominant Space Capabilities on
            Time and on Cost
              4. Attract, Develop, and Retain People with the Expertise
            Necessary to Meet the Challenges of the Future

        We have our sights set on these priorities. They serve to guide our
    focus in the way we operate today and to underpin the investments we
    need to make for our future.

     PRESERVE AND EXPAND OUR ABILITY TO DELIVER SPACE EFFECTS TO THE JOINT
                                     FIGHT

        To achieve our first priority, we must do two things. First, we
    must preserve our ability to deliver space effects in today's fight.
    This means we must properly organize our forces, train them for
    success, and equip them with the tools necessary to protect our
    asymmetric advantage in space. Second, we must expand the capabilities
    we provide by always looking for ways to more efficiently operate our
    current systems while investing in the systems we will need tomorrow.
    Preserve our Advantage in Space
        Preserving our advantage in space is a prerequisite for everything
    else we do. To achieve this, we first require the ability to
    effectively surveil the space domain with the goal of answering, in as
    near to real-time as possible, the questions of ``who, what, when,
    where, how, and why?'' that are so vitally important to the commander
    responsible for operations in any domain. We refer to this as Space
    Situational Awareness (SSA). Breaking this down further we arrive at
    the key ingredients necessary to achieve the SSA we need. First, we
    must establish the right organizational command construct. Second, it
    is vital for us to maintain and field the correct mix of space
    surveillance capabilities along with the ability to rapidly fuse,
    analyze, and display the data we collect in a fashion that will inform
    timely decisionmaking by our commanders. Next, we must be able to
    effectively command and control our forces. Finally, our ability to
    preserve our advantage in space will only succeed if we have assured
    access to the domain through highly dependable and responsive launch
    vehicles. In 2006, AFSPC made progress in all of these areas.
        We solidified our support to United States Strategic Command
    (USSTRATCOM) with their assignment of Major General Willie Shelton, our
    14th Air Force Commander, as USSTRATCOM's Joint Functional Component
    Commander for Space (JFCC-SPACE). That one organizational change,
    coupled with the establishment of the Joint Space Operations Center
    (JSpOC) at Vandenberg AFB, CA, aligned warfighter functional
    responsibilities with Air Force space capabilities and expertise. This
    is a good news story in the leveraging of Air Force people and assets
    to lead in the joint space environment. Ultimately, this change
    produced unity of command in delivering joint space capabilities for
    the combatant commanders.
        In the past year, this organizational construct was central to the
    delivery of over 18,000 mission essential products to regional
    combatant commanders supporting Operations Iraqi Freedom, Enduring
    Freedom, and Noble Eagle. In the Central Command (CENTCOM) alone, in
    the Combined Air and Space Operations Center in Southwest Asia, the
    Director of Space Forces received direct support from Major General
    Shelton's JSpOC and the airmen under his command operating the Defense
    Support Program satellite constellation. Together, they evaluated more
    than 2,100 infrared signatures in the CENTCOM AOR, enhancing
    battlespace awareness and force protection efforts for our Nation's
    deployed soldiers, sailors, airmen, and marines.
        Today, AFSPC's worldwide space tracking and surveillance network
    provides positional data on over 16,000 space objects. Our expert team
    of orbital analysts used this data for satellite collision avoidance
    with space debris as well as with other satellites. This analysis, in
    turn, helped safeguard over $50 billion in U.S. space assets which are
    vital to our Armed Forces, as well as interagency, coalition partners
    and the American economy. However, recent events like the Chinese ASAT
    test, which added over 1,600 new pieces of debris to our previous count
    of 14,000, only serve to highlight the need for us to further enhance
    our ability to surveil the space domain.
        Today, our surveillance, analysis and data-sharing capabilities do
    not adequately support our future needs to rapidly identify and
    understand the threats to our space systems. Given that limitation, we
    are working hard to make the most of every dollar spent in this area to
    optimize our surveillance function and give the Commander, USSTRATCOM,
    a better understanding of our space operating picture. These efforts
    include working in close cooperation with the Missile Defense Agency
    (MDA) to upgrade our early warning radars, examining alternatives for
    funding upgrades to a vital Space Surveillance Network radar at Eglin
    AFB, FL, and sustaining the Mid-course Space Experiment (MSX)
    satellite, our sole space-based space surveillance (SBSS) system. On
    the heels of MSX are the SBSS Block 10 (launching in fiscal year 2008)
    and Block 20 satellites which will provide critical enhancements to our
    need to surveil objects beyond Low Earth Orbit. Finally, we have begun
    a clean sheet look at requirements for how we should best surveil the
    space domain in the future.
        The need for SSA increases exponentially as our joint forces become
    more dependent on space. With our Nation's dependency on our space
    capabilities, in the future it will be even more essential for us to
    definitively identify the cause of any interruption in the delivery of
    our space-provided or space-enabled capabilities. Just as importantly,
    we must also be able to attribute who or what caused any interruption.
    Meeting this requirement puts our SSA needs on par with the air, land,
    and sea domains. In every one of these domains, our combatant
    commanders can obtain a solid picture of the threat, allowing them to
    produce, in a timely manner, a wide range of response actions. This is
    even more critical in the space arena where the response time can be
    significantly shorter for commanders to make decisions which will
    impact the lives of thousands of our soldiers, sailors, airmen, and
    marines. Furthermore, these threats to our space capabilities do not
    just exist in the space domain. We are staying equally focused on the
    other two critical elements of any space system; our ground stations
    and the communications links between the satellite, the ground station
    and the user. Without high fidelity and timely SSA, our national
    leaders will not have the key information needed to determine the range
    of available political, economic or military options to deter or
    counter future threats. Providing the Joint Functional Component
    Commander for Space (JFCC-SPACE) with the SSA he requires to
    effectively plan, operate, and fight is our top concern.
        To address this concern, we are driving towards several significant
    milestones. In fiscal year 2008, we will create an Integrated SSA
    program. Part of this effort entails creating a Space High Accuracy
    Catalog and replacing our 1991 vintage Space Defense Operations
    Computer with a net-centric, services-oriented architecture that will
    provide the combatant commanders and national users with actionable
    information on launches, satellite breakups, maneuvering objects and
    reentries. Additionally, the Rapid Attack Identification and Reporting
    System Block 20 program will better integrate and fuse space data
    (space intelligence, surveillance and space environmental monitoring)
    enabling JFCC-SPACE to better protect and defend critical space assets
    and respond to new and emerging threats, whether hostile or
    environmental. Each of these programs will help us meet our SSA needs.
        While SSA is the foundation for all operations, Space Command and
    Control (C2) is what links the JFCC-SPACE to the joint fight.
    Commanders in every domain require a basic C2 capability over their
    forces, and the same holds true in space. Effective Command and Control
    allows us to deliver flexible, agile and responsive effects to the
    battlespace, be it land, sea, or air. To accomplish this, we are
    developing a suite of enhanced command and control tools to synchronize
    space and air effects and improve support to joint/combined forces and
    national partners. For example, we are working hard to develop robust
    space C2 applications enabling the Joint Functional Component Commander
    for Space to rapidly process and satisfy space support requests from
    the regional combatant commanders. Major General Shelton and his team
    are doing an outstanding job, but to reach their maximum capability
    they simply must have state of the art equipment on-par with our other
    air and space operations centers. The tools currently under development
    will give the JFCC-SPACE a better understanding of the space
    environment and permit continuous collaboration with joint, national
    and coalition partners and make us more agile and responsive to the
    complex environment in which our soldiers, sailors, airmen, and marines
    operate.
        The final element of preserving our ability to deliver space
    effects to the joint fight is safely and reliably delivering payloads
    into orbit. The most critical portion of any spacecraft's life is
    launch. Today, due to the hard work of our men and women of the Space
    and Missile Systems Center, 14th Air Force, our two launch wings and a
    second-to-none contractor team, we stand at 50 successful national
    security payload launches in a row and have a 100 percent record of
    success with our new Evolved Expendable Launch Vehicle (EELV) class of
    vehicles (15 for 15 operational launches). In total, eight National
    Aeronautics and Space Administration, seven Department of Defense
    (DOD), one commercial, and six Space Test Program (STP) launches lifted
    off from our east and west coast launch and test ranges in 2006. Our
    most recent launch on 8 March 2007 successfully carried the STP-1
    mission with six individual spacecraft on board. The impressive list of
    firsts for this mission include: the first launch of an Air Force
    payload on an Atlas V, the first Air Force mission with six unique
    spacecraft, the first dedicated EELV mission for the STP and the first
    Atlas V to carry multiple satellites to two distinctly different Low-
    Earth Orbits. This highly successful STP mission carried satellites
    from the Defense Advanced Research Projects Agency, Los Alamos National
    Laboratory, the U.S. Naval Academy, and the U.S. Air Force Academy. In
    2007, we will continue this pattern of excellence, continuing to prove
    nobody knows spacelift better than AFSPC.
        As we work towards preserving our ability to deliver space effects
    we also remain cognizant of the fact there is no downtime for us, as
    our mission and training continue 24/7, 365 days a year. Each day we
    maintain a laser-sharp focus on expanding our ability to deliver space
    effects to our Armed Forces, Nation, allies, and coalition partners.
    Expanding our Ability to Deliver Space Effects
        Expanding our ability to deliver space effects to the joint fight
    entails both sustaining and enhancing our on-orbit position, navigation
    and timing; communications, environmental monitoring, and missile
    warning constellations, as well as investing in new capabilities and
    systems to increase our responsiveness to warfighter needs.
        Our current on-orbit constellations are the best in the world,
    including our flagship, the Global Positioning System (GPS). GPS
    continues to perform as the world's premier space-based positioning,
    navigation and timing system. GPS capabilities are integrated into
    nearly all facets of U.S. military operations and give the American and
    coalition warfighter an unparalleled advantage. GPS is integral to
    numerous battlefield innovations, including the Small Diameter Bomb,
    the Guided Multiple Launch Rocket System (GMLRS) and Joint Precision
    Air Drop System. We have also delivered nearly 100,000 advanced
    handheld GPS receivers to the field. US and coalition warfighters
    navigating with GPS across trackless deserts and employing GPS-guided
    munitions are testimony to the awesome effect GPS has on precision
    attack. Additionally, the increased accuracy of GPS-guided munitions
    has saved lives and reduced collateral damage.
        GPS also plays a major role supporting day-to-day business
    activities within our global commercial economy. Our satellites enable
    accurate directions to any mapped location, safe and efficient air
    travel, navigable oceans and waterways, as well as more efficient use
    of maritime resources, emergency and rescue services and precise timing
    data for communication systems, electrical power grids, and financial
    networks. GPS has literally become a household name.
        Efforts are well underway to sustain and modernize this global
    space-based navigation system, to ensure we meet the future needs of
    military and civilian users. We now have the first three of eight
    Modernized (IIR-M) GPS satellites on-orbit, a significant step towards
    offering new signals for military and civil users. First, the military
    signal (M-code) with enhanced encryption, will be transmitted on two
    distinct frequencies to improve anti-jam capabilities. Second, an
    additional civil signal will provide improved accuracy for civil,
    commercial, and scientific users. The next series of advanced GPS
    satellites (IIF), scheduled to launch in 2008, will have an extended
    design life of 12 years, faster processors with more memory, a new
    civil signal on a third frequency (L5) and increased power to reduce
    vulnerability to signal jamming. We are also making GPS easier to
    operate and maintain, by upgrading the GPS ground station control
    system from a mainframe system that is over 20 years old and becoming
    cumbersome to operate and repair, to a distributed architecture.
        We just released the Request for Proposal (RFP) on the next
    generation GPS ground segment and look forward to releasing the GPS III
    space segment RFP, bringing us an improved space and ground segment
    intended to assure reliable and secure delivery of enhanced position,
    navigation, and timing signals. The GPS III Block A satellites will
    transmit a significantly higher-powered military signal. Other features
    will be a new fourth civil signal (interoperable with Europe's Galileo
    and Japan's Quasi-Zenith Satellite System). We are also developing next
    generation military GPS user equipment that will take advantage of the
    modernized military signal.
        We have demonstrated time and time again that GPS is the world
    standard for PNT. No other system comes close to delivering the proven
    performance of the GPS constellation.
        The demand for SATCOM continues to grow by leaps and bounds. Our
    fully operational Milstar and Defense Satellite Communications System
    (DSCS) constellations are the Combatant Commanders' workhorses. The
    increased capabilities of the Command and Control-Consolidated ground
    system are paying huge dividends. Engineering and contractor teams
    continue developing innovative tactics, techniques and procedures for
    maximizing bandwidth and increasing satellite life span.
        Yet another capability available to the warfighter is the AFSPC-led
    Global Broadcast System (GBS). Via fixed and mobile injection points we
    provide worldwide, high-capacity, one-way transmission of classified
    and unclassified high-speed multimedia communications and information
    flow for on-the-move or garrisoned forces. GBS is used to transmit
    everything from near real-time UAV sensor feeds to critical
    intelligence data. One Army intelligence team providing support to
    Coalition-Joint Task Force 76 used GBS to download between 80 and 120
    images of Afghanistan every day. It is akin to our very own satellite
    broadcast network and the reviews are phenomenal.
        Clearly, the joint warfighter appreciates and depends on the
    capabilities we provide from and through space.
        Looking ahead, SATCOM will continue to be an area of focus for us.
    In 2007, we will launch the first Wideband Global SATCOM (WGS)
    satellite. We are excited about this launch because this one satellite
    will have more bandwidth capacity than the entire DSCS constellation
    (nine satellites) currently on orbit. Adding satellites 2 and 3, both
    fully built and undergoing testing and integration, will further
    improve warfighter SATCOM capability.
        The Advanced Extremely High Frequency (AEHF) SATCOMs System is on
    schedule for launch in early 2008. Brigadier General Ellen
    Pawlikowski's joint service team at the Space and Missile Systems
    Center is completing the first satellite, with the second satellite
    scheduled for testing in July 2007 and the third satellite experiencing
    on-time progress as well.
        Development of the Transformational SATCOMs System (TSAT) is a high
    priority. Technology risk reduction efforts on the laser communications
    and the next generation processor router are going well. As Lt. Gen.
    Frank Klotz testified to last year, the TSAT constellation will enable
    ``communications on the move'' and will transform the Services' net-
    centric architectures including the Army's Future Combat System, the
    Navy's ForceNet, the Marine Corps' X-Net concept and the Air Force's
    Global Information Grid initiative. TSAT is an integral part of our
    Armed Force's future concept of military operations. Today, an 8
     10 image takes 2 minutes to transmit over Milstar. With
    TSAT, the same image will be transmitted in less than 1 second. A UAV
    image, which takes up to 12 minutes to send via Milstar, will be sent
    in less than 1 second with TSAT. We are working towards a System Design
    Review in April 2007 and ultimately a space segment contract award at
    the end of this year.
        Despite this progress, Military SATCOM (MILSATCOM) is an area for
    concern. We have reached the point in time where further schedule slips
    potentially affect both protected communications on the battlefield and
    the command and control of our strategic forces. It is critical for us
    to successfully launch every satellite in the pipeline and to meet all
    current program timelines. Any significant reduction in resources, an
    AEHF or WGS launch failure or another slip to the TSAT program, could
    create gaps in our MILSATCOM coverage--something our Combatant
    Commanders cannot afford.
        Another space capability entrusted to us is environmental
    monitoring. We launched our newest weather satellite, DMSP-17, in
    November 2006. DMSP-17 replaced a satellite that had been operational
    since 1995. What is amazing about that old satellite is that it had a
    design life of 3 years. Eleven years later it was still delivering
    critical support to the joint fight. Our dedicated professionals
    managed to extend the replaced satellite's lifespan by almost a decade!
    This is a true testament to our AFSPC/contactor design, operations and
    sustainment teams.
        Many of our space systems have far-reaching capabilities that
    provide information for strategic and tactical users simultaneously. A
    legacy system from the Cold War, our Defense Support Program has shed
    its singular role in the Strategic Deterrent mission to become a
    critical ingredient in the combatant commanders' toolkit as a theater
    asset. With our pending final DSP launch, this constellation has
    exceeded all original expectations. This year we began a new era with
    the launch and on-orbit operational testing of the first asset of the
    next-generation of warning systems--the Space Based Infrared System
    (SBIRS). To date, SBIRs testing has exceeded all expectations and we
    are confident that the SBIRS constellation will be as revolutionary to
    missile warning as GPS has been to PNT.
        It has been more than 5 years since an Air Force satellite suffered
    a major capability failure before reaching its intended design life.
    Every system in our portfolio has exceeded its potential and provided
    more robust utility to the Combatant Commanders through improved and
    upgraded features as well as through innovations in the operation of
    each constellation. However, new threats and new battlefield
    requirements dictate our continued vigilance in preserving and
    expanding our ability to deliver space effects to the joint fight both
    today and in the future.
        Along these lines, we are currently analyzing ways to develop space
    systems to deliver the following capabilities: 1) could rapidly augment
    current surveillance, reconnaissance, and communication platforms in
    response to the needs of a combatant commander; 2) could rapidly
    replace space assets disabled by attack or natural phenomenon, and 3)
    could rapidly deploy systems to support our SSA needs. Dubbed
    Operationally Responsive Space (ORS), this concept is centered on the
    rapid development, building, launch and activation of new and likely
    smaller satellite systems.
        We have begun to experiment with smaller satellites with the launch
    of Tactical Satellite (TACSAT)-2 on 16 December 2006. Once testing is
    complete, the spacecraft will be used in a series of joint
    demonstrations collecting data to make a recommendation of military
    utility. TACSAT-2 will participate in Exercises Talisman Saber 07,
    Empire Challenge 07, Valiant Shield, and Ulchi Focus Lens 07. TACSAT-2
    along with TACSAT-1, 3, and 4 will allow us to answer key questions on
    what capabilities we should focus on in the future to meet
    augmentation, replenishment or surveillance needs. Ultimately, any ORS
    system that requires the launch of a new satellite will require
    leadership of the integrated effort, from the booster, to the bus, to
    the payload, to C2 and data delivery architectures. The Air Force and
    AFSPC are uniquely populated with the expertise across these
    disciplines to develop and field these capabilities.
        Providing leadership over these programs is a key responsibility of
    AFSPC and we are pleased to have the opportunity to currently lead
    vital aspects of ORS to include requirements validation, TACSAT
    Military Utility Assessments and ORS Analysis of Alternatives (AoA)
    efforts. The planned standup of the ORS Office at Kirtland AFB, NM, is
    a giant step forward in supporting future operational satellite
    development and procurement for this emerging mission area. The
    connection with our Space Development and Test Wing is also critical in
    the early years of the program to capitalize on best practices in
    emerging technologies.
        The Commander, USSTRATCOM has identified a need to strike promptly
    and precisely against global targets using conventional kinetic
    effects. To this end, we are advancing a technology demonstration
    program to evolve, mature, and integrate critical technologies for a
    continental United States (CONUS)-based Conventional Strike Missile
    capability. This vision for a mid-term (fiscal years 2014/2015)
    capability will address the Nation's prompt conventional global strike
    requirement. To ensure there is no misinterpretation of intent, a
    multi-faceted package of mitigating measures will be added to the
    operational concept. Elements of this package could include: Coastal
    basing which is geographically separate from ICBM bases; associated on-
    site inspections/verification; unique and distinguishable trajectories
    and flight paths; avoiding overflight of nations of concern; and
    strategic dialogue that provides a window into U.S. thinking.
    Additionally, we are conducting an AoA to examine potential prompt
    global strike capabilities for the long-term (fiscal year 2020 and
    beyond).

                  PROVIDE SAFE AND SECURE STRATEGIC DETERRENCE

        Of all the missions with which we are entrusted, Strategic
    Deterrence has the least margin for error. Thankfully, this Nation has
    the men and women of 20th Air Force and the leadership of Major General
    Tom Deppe to rely on.
        Providing safe and secure strategic deterrence depends on the
    modernization of our current force and the infrastructure which
    supports it. To this end we have embarked on an aggressive Minuteman
    III modernization program. These efforts encompass modernizing every
    stage of the missile, the launch silos, and the command and control
    centers to meet our deterrence mission beyond 2025. Additionally, we
    remain actively engaged in efforts to replace an aging, but vital, UH-
    1N helicopter fleet to support ICBM security requirements.
    MM III Modernization
        Our Air Force team is modernizing the Minuteman III missile from
    nose to tail. The first Safety Enhanced Reentry Vehicle modification
    kit was installed in October 2006 enabling use of the MK 21 reentry
    vehicle from the deactivated Peacekeeper missile on our Minuteman III
    missiles. More importantly, this modern warhead provides USSTRATCOM
    planners with increased targeting flexibility and enhanced safety.
        In the year ahead, we will continue modernization of all of our
    Minuteman III missiles with a sustainable schedule calling for
    Propulsion Replacement Program (PRP) upgrades for 96 missiles. The PRP
    upgrade replaces aging motors and propellant as well as environmentally
    unsafe materials and components. To date the program has completed 52
    percent of its production run with 312 deployed in the field. In 2007,
    73 Minuteman IIIs will complete Guidance Replacement Program upgrades
    which will replace some of the 1960s generation electronics in the
    guidance system, further extending the missile's operational life. This
    program has completed 69 percent of its production run and 442 are
    deployed in the field. Additionally, we have fielded more than 65
    Propulsion System Rocket Engine (PSRE) upgrades across the fleet,
    accounting for 13 percent of the total production run. These PSRE
    upgrades replace components originally produced in the 1970s with a 10-
    year design life. Finally, we are excited about the improvements built
    into the future Reliable Replacement Warhead. This replacement warhead
    will make use of the best security technology available and allow for a
    credible nuclear deterrent with the smallest nuclear weapons stockpile
    needed for national security purposes. While upgrades to the missile/
    warheads are critical, it is only one piece in a larger system.
    Modernization of Launch Facilities
        At our launch silos we remain focused squarely on improving
    security. Our ICBM Security Modernization Program contains three
    synergistic elements. First, concrete enhancements have been completed
    at all but one of our ICBM squadrons, ensuring our Nation's nuclear
    arsenal is safe and secure. The second security upgrade (the fast-
    rising B-plug) enables security forces to rapidly close an open missile
    silo in the case of an impending security breech. We began the first
    installation of this technology at Minot AFB, ND, in February. Finally,
    20 AF is capitalizing on technology by deploying a Remote Visual
    Assessment (RVA) capability to enhance physical security. RVA employs a
    remote video camera to provide situational awareness at unmanned launch
    silos, enabling our security forces to tailor and accelerate response
    force actions to deny unauthorized access. In addition, this upgrade
    allows us to more efficiently use our most precious but limited
    resource, our airmen.
    Building on Previous Accomplishments
        In addition to the upgrades in progress, we are proud to have
    completed (last year) the 4-year deployment of the $114 million Rapid
    Execution and Combat Targeting Service Life Extension Program, the
    heart of our ICBM command and control element. This command and control
    upgrade provides increased responsiveness and gives planners additional
    flexibility to meet rapidly changing world situations and evolving
    mission requirements. When combined with the previously completed
    Minuteman Minimum Essential Emergency Communications Network
    modernization of our communications links, we have achieved a
    tremendous leap forward in technology and operational C2 throughout
    20th Air Force.
        Equally impressive is the work we have accomplished, in partnership
    with the Wyoming National Guard, at the Nuclear and Space Security
    Tactics Training Center at Camp Guernsey, WY. Not only are we providing
    our security force warriors, maintainers and operators a much needed
    place to exercise their combat skills but we are also preparing airmen
    for deployment with our Air Expeditionary Forces.
        When we factor in all the upgrades to the Minuteman III weapon
    system we will have effectively reset the force to continue to provide
    unmatched deterrence through the third decade of the 21st century.
    UH-1N Helicopter Replacement
        Even with of all these upgrades, we can not lose sight of one final
    and critical piece of the ICBM puzzle, our UH-1N helicopter fleet. This
    aircraft is our fastest and only way of rapidly responding to potential
    missile field security breeches. The Air Force is examining
    alternatives for replacement helicopters and we are working within the
    budget process to secure replacements. As we replace equipment that is
    war-battered from overseas deployments, it is important to recognize
    that our aged UH-1N fleet is flying as hard as ever, right here within
    our own borders.

    DEVELOP, FIELD, AND SUSTAIN DOMINANT SPACE CAPABILITIES ON TIME AND ON
                                      COST

        In the last year, we made great strides in acquisition and ushered
    in a new era with the opening of the Space and Missile Systems Center's
    Schriever Space Complex. Under the leadership of Lieutenant General
    Mike Hamel, we continue to make progress in developing, fielding and
    sustaining dominant space capabilities on time and on cost. Through a
    dynamic acquisition strategy, the sustainment of current systems, and
    the development of future dominant space capabilities AFSPC will
    achieve our goal of becoming the acquisition model for DOD.
    Acquisition Strategy
        The cornerstone of our acquisition strategy lies in our ``back to
    basics'' approach to systems development, acquisition and sustainment.
    We understand just how important space capabilities are to the
    warfighter and we know the acquisition recipe that achieves results.
    Our comprehensive plan to get ``back to basics'' is already showing
    results in putting programs back on track and leading to a new
    generation of transformation and innovation based on solid systems
    engineering.
        We continue our commitment to risk mitigation across the entire
    space portfolio. As Dr. Sega has outlined, one of the key ingredients
    is our ``walk before you run'' strategy. Past acquisition failures can
    be traced to over-optimistic estimates of the maturity of key
    technologies and misunderstanding the challenges associated with system
    complexity. Our block development approach changes that, enabling us to
    gradually introduce new technology as it matures.
        Holding our leaders accountable is the key to the future success of
    this strategy. We are entrusting our top acquisition leaders with the
    authority they deserve but, at the same time, demanding results. We cut
    down functional stovepipes and are horizontally integrating key
    processes across programs by better reorganizing functions like
    engineering, program management, finance, logistics, developmental
    planning, and contracting. We are excited about the year ahead, as we
    continue ``turning the corner'' in space acquisition. We have always
    developed, fielded and sustained dominant space capabilities and we are
    confident we will go beyond that by producing tomorrow's space
    capabilities on time and on cost.
    Develop, Field, and Sustain Dominant Space Capabilities
        With our strategy in place we turn our attention to developing,
    fielding and sustaining dominant space capabilities. Our new and
    upgraded systems have already begun delivering transformational
    results. The capabilities we enable for the combatant commanders will
    only increase as these systems gain traction and momentum. Later this
    year, we expect to begin payload assembly, integration and testing on
    the first SBSS sensor. Also vital to the joint warfighter, our AEHF
    satellite program is back on track to deliver positive results in the
    near future. As previously stated, the first WGS will lift off this
    year, providing an exponential leap in bandwidth availability. Meeting
    these, as well as all of our program commitments, will help ensure the
    asymmetric advantage of space is available to future generations of
    joint warfighters.
        One of these absolutely critical programs is SBIRS. With the launch
    of the SBIRS HEO-1 payload, we demonstrated the SBIRS program is on the
    path to success. Not only is HEO-1 on-orbit, but as stated earlier, its
    sensor is exceeding performance specifications and providing truly
    revolutionary results. This is good news for the upcoming SBIRS GEO
    satellite, which shares common sensors. The first GEO satellite is
    undergoing integration testing for its launch in 2008. As we close out
    a proud chapter in our history with the last DSP launch, we will open a
    new chapter with the delivery of the first SBIRS geosynchronous payload
    (GEO-1) for integration with its space vehicle this year.
        Our GPS constellation remains healthy with 30 satellites on-orbit,
    but increased dependence on this system requires us to push ahead with
    developing and fielding improvements. In 2007, we project the
    completion of thermal vacuum testing on the newest block of satellite,
    the GPS IIF. Again, this advanced satellite will provide tremendous
    advances in our PNT capability, making GPS more jam-resistant on the
    battlefield while delivering increased accuracy for civil customers.
        As was previously mentioned, in 2006 we launched a Defense
    Meteorological Satellite Program weather satellite. After a picture-
    perfect launch, the space vehicle was checked out and placed into
    operational service in record time, another true success story in
    developing, fielding, and sustaining dominant space capabilities.
        While we sustain and modernize our on-orbit assets, we also remain
    committed to updating an aging infrastructure. The EELV's unprecedented
    record of initial successes literally translates into millions of
    dollars in savings. We continue to aim for 100 percent mission success
    with the new United Launch Alliance (ULA) initiative while implementing
    the ``Buy 3'' contracts. Recently, my vice commander, Lieutenant
    General Frank Klotz and I had the opportunity to visit the ULA plant in
    Decatur, AL, and were both impressed with the facility and the ULA
    team.
        Another aging piece of infrastructure, the Air Force Satellite
    Control Network (AFSCN), had its last major modernization in the late
    1980s with the installation of 286 computers. The current system is
    heavily impacted by obsolete, vanishing parts and reduced numbers of
    vendors. Currently, AFSPC is undergoing a cost-effective modernization
    of the AFSCN legacy system with off-the-shelf control and status
    equipment and new antennas that allow a more integrated and
    interoperable satellite network to support U.S. Government satellite
    operations.
        The AFSPC launch and test ranges are modernizing infrastructure to
    upgrade radar, telemetry and data systems for reliable and responsive
    access to space through our Range Standardization and Automation
    Program. We are taking steps toward space-based range through the use
    of GPS to track boosters and efforts to explore future flight
    termination and data relay technologies.
        We are also partnering with the MDA to upgrade and field missile
    defense capabilities and enhance the defense of our homeland and our
    allies against ballistic missile threats. In 2007, we will enhance
    capabilities at two Upgraded Early Warning Radar sites: first at Royal
    Air Force Fylingdales, United Kingdom, followed by Beale Air Force
    Base, California. The next upgrade is in coordination for Thule Air
    Base, Greenland, with an anticipated completion in fiscal year 2010.
    SBIRS has already established a fully-integrated Missile Defense
    capability and continues to improve burn-out tracking and projected
    impact prediction performance. Our efforts to achieve these
    capabilities are conducted on a non-impact basis to our primary mission
    of strategic missile warning supporting our Nuclear Command and Control
    System as directed in National Security Presidential Directive0928.
    Additionally, we are providing significant support to many MDA flight
    tests and the necessary security for the operational ground-based
    interceptors at Vandenberg AFB, CA.
        We have shown we can get ``back to basics'' with our space
    acquisition programs, and in the near future we will be providing
    incredible new capabilities that will accompany every single soldier,
    sailor, airman, or marine into battle. We have a tremendous
    responsibility to support our warfighters, and it's through the amazing
    people of AFSPC that I know we will succeed.

      ATTRACT, DEVELOP, AND RETAIN PEOPLE WITH THE EXPERTISE NECESSARY TO
                       MEET THE CHALLENGES OF THE FUTURE

        Our fourth and final strategic priority is to attract, develop, and
    retain people with the expertise necessary to meet the challenges of
    the future. Our Air Force Chief of Staff recognized this when he made
    the development of world-class professionals one of his top priorities.
        One of our greatest future challenges is recruiting people equipped
    with the right skills to succeed in a much more dynamic and
    technologically challenging environment. Accordingly, we have placed
    increased emphasis on sustaining ongoing force development and
    voluntary off-duty degree programs at each of our bases to facilitate
    career-long education opportunities. In 2006, using AF tuition
    assistance, airmen in AFSPC completed 22,000 college-level enrollments,
    earning 66,000 advanced education credits, resulting in 1049 job
    enhancing degrees (associates to masters). Reinvesting in our human
    capital like this runs in parallel with recapitalization of our
    infrastructure. In the upcoming year, we will also increase the focus
    on recruiting cadets from the Air Force Academy and the Nation's other
    top colleges and universities into space-related career fields within
    the Air Force.
        Our requirement for a highly educated and technical workforce
    places additional demands on our professional development efforts. We
    must strengthen the technical foundation of our people, and match those
    with technical degrees against specific job requirements. The National
    Security Space Institute addressed this demand by expanding education
    and training opportunities, further cementing itself as the go-to place
    for space education. In the past 18 months, we've introduced the Space
    Integration Course (Space 300), offering it twelve times in fiscal year
    2007. We also offered 19 Space Application (Space 200) Courses, and
    continue to meet expanding needs by developing a Distance Learning
    version of our Space 200 curriculum which will reach a broader group of
    students including our traditional reservists. In addition, two Naval
    Operations (NAVOPs) Advanced Courses and the first-ever Missile Warning
    and Defense Advanced Course were taught. In anticipation of modern
    warfighter demands, we are developing a SATCOM Advanced Course which
    will have its initial offerings within 12 months. We are poised to
    continue to offer NAVOPS and SATCOM Advanced Courses and to answer
    requests for a Space Superiority Advanced Course and a Rendezvous/
    Proximity Operations course as funds are made available. The surging
    demand for these courses has been remarkable, to include interest from
    many of our allies. Through all of these efforts we already see the
    benefit of our education programs with the outstanding job our airmen
    are doing both from CONUS and in theater.
        One airman who has taken full advantage of the many educational
    opportunities is Major Toby Doran, a graduate of Space 100, the USAF
    Space Weapons Instructor Course and the Air Force Institute of
    technology (degree in space operations). In 2006, Major Doran deployed
    from AFSPC (as part of a Joint Space Support Team, Camp Fallujah, Iraq)
    and helped identify a required modification in the Army's GMLRS weapon
    system. The problem was the GLMRS system used old GPS data under
    certain conditions. Major Doran ascertained that if stale ephemeris
    data was passed to a rocket prior to launch, it could cause an error in
    the rocket's impact point. Major Doran, in coordination with our GPS
    Operations Center (GPSOC) and Director of Space Forces, engineered
    procedures to ensure soldiers employing GLMRS in Iraq and Afghanistan
    received immediate notification of GPS outages from the JSpOC and
    GPSOC. This is just one example of many where AFSPC airmen used their
    education, technical training and operational experience to take
    responsibility for the combat effects we provide through space.
        To maintain our momentum, we began an extensive effort to make it
    easier to earn advanced technical degrees. At our ICBM Launch Control
    Centers, we have fielded something we call Netlink. For the first time
    ever, our missile combat crews are able to access the internet and
    complete distance learning courses while on-alert, underground. We also
    developed a pilot, five-course academic certificate program with the
    Space Education Consortium through the University of Colorado at
    Colorado Springs to further increase the technical knowledge of our
    space professionals. This consortium is comprised of 10 universities
    and 2 institutes throughout the United States, including an
    international member in Strasbourg, France. In fact, the first class of
    the certificate program, Systems Engineering, met in January 2007 with
    20 AFSPC airmen (officers and enlisted) providing glowing feedback
    about the program. Most of the course work is completed via distance
    learning, and the members of this initial cadre will complete a space
    certificate program they can apply to a Master's degree in:

             Space Operations (Master of Engineering),
             Systems Engineering (Master of Engineering),
             Engineering Management (Master of Engineering), and
             Business Administration (with space emphasis).

        With your support, we can expand this pilot program to make it
    available to all of our airmen. The Air Force Institute of Technology
    and Naval Postgraduate School have also developed dynamic new
    certificate and degree programs aimed at the development of our airmen.
    We are excited about these programs, and the additional opportunities
    they provide for building the next generation of space leaders.
    Ultimately, our young men and women will hold the keys to the future
    success of our Nation's ``invisible force.'' My promise in the year
    ahead is to further codify our space professional development efforts
    and produce a more robust and challenging program for our Nation's
    space professionals. In addition, we will continue to work across
    service boundaries and with the National Reconnaissance Office to get
    the right person with the right expertise in the right position to
    lead. We know that ultimately our most important job is to grow the
    future air and space leaders who will step into our shoes and make the
    next 25 years even better than the last.

                                   CONCLUSION

        This year our Air Force celebrates its 60th anniversary and AFSPC
    turns 25 years old. The force we built over the last 25 years is truly
    remarkable and the investments we made together are paying off on the
    battlefield. However, success in the next 25 years will require the
    same level of commitment. There is no doubt in our minds that our
    ability to operate in space is critical to our Nation, and so we must
    improve our investment in areas like SSA and C2.
        Every soldier, sailor, airman, and marine benefits from the
    capabilities provided by our space forces. Recapitalizing our space
    systems will ensure we have even better capabilities for our forces in
    the future. While you cannot see or touch many of our space
    capabilities, the combatant commanders know they are there and rely
    heavily upon them. The effects we deliver via the space domain will no
    doubt be an integral part of every future military operation. The men
    and women of AFSPC are your ``go to'' experts for space, and with
    Congress' support, we will deliver what this Nation needs to ensure the
    asymmetric advantage our space forces bring to the fight today will be
    even more dominant in the future.

        Senator Bill Nelson. Senator Sessions?

                   STATEMENT OF SENATOR JEFF SESSIONS

        Senator Sessions. Thank you, Mr. Chairman. I sincerely
    apologize for being tied up after that vote we just finished.
        First I'd like to thank this distinguished panel. You
    represent leadership in some of the most complex,
    technologically challenging and important parts of our defense
    establishment, and we appreciate that.
        The Air Force has been faced with the difficult challenge
    of modernizing military space systems in virtually every
    mission area. Strategic missile warning, assured
    communications, navigation, and intelligence and surveillance.
    We've explored in this subcommittee previously that many of
    these programs have suffered substantial problems with regard
    to cost, schedule, and technical performance.
        But, thanks to a new Air Force leadership, practices that
    you all have worked on, I believe we may be turning the corner
    on some of those worst problems. I think progress has been made
    and I'd like to inquire a little bit more about it, but my hope
    is that the new back-to-basics approach in conjunction with new
    emphasis on ORS, will expedite delivery of capabilities to the
    warfighter in a cost-effective manner.
        Our budget, the $8.1 billion budget request for space
    modernization in fiscal year 2008, is up from the fiscal year
    2007 appropriated amount of $6.7 billion, but it falls $400
    million short of what the Air Force had planned to spend, so we
    need to look at those expenditures and whether or not we're
    meeting the needs that are out there.
        Mr. Chairman, thank you for this opportunity to say a few
    words and I'll look forward to hearing from the panel.
        [The prepared statement by Senator Sessions follows:]

                  Prepared Statement by Senator Jeff Sessions

        Mr. Chairman, I would like to welcome today's witnesses and thank
    them, and their organizations, for their hard work and contributions to
    our Nation's security. While the recent anti-satellite test conducted
    by China has raised the visibility of space programs, we both realize
    that the Department of Defense has been working hard to ensure that our
    space capabilities are second to none.
        The Air Force has been faced with the difficult challenge of
    modernizing military space systems in virtually every mission area:
    strategic missile warning. assured communications, navigation, and
    intelligence and surveillance. For reasons that this subcommittee has
    explored previously, many of these modernization programs have suffered
    substantial problems with regard to cost, schedule, and technical
    performance.
        Thanks to new Air Force Space leadership and practices, I believe
    we may be turning the corner on the worst of these problems. It is my
    hope that the new ``back to basics'' approach, in conjunction with the
    new emphasis on Operationally Responsive Space, will expedite delivery
    of capabilities to the warfighter in a cost-effective manner.
        Mr. Chairman, there is something that troubles me. While the
    Department of Defense and the Air Force clearly acknowledge the
    critical importance of space programs as an enabler for virtually every
    defense mission area, it has nevertheless reduced the planned growth in
    space funding that was presented to Congress last year.
        Although the $8.1 billion request for space modernization in fiscal
    year 2008 is up from the fiscal year 2007 appropriated amount of $6.7
    billion, the request falls $400 million short of what the Air Force
    planned to spend in fiscal year 2008.
        As we will explore during the course of this hearing, this funding
    shortfall has serious implications for several key modernization
    programs in the area of space communications and space control.
        In light of recent Chinese space activities, and the growing
    importance of space for United States national security, I think we
    need to look carefully at whether the budget request for space
    modernization, which is 21 percent of total Air Force modernization, is
    adequate.
        Mr. Chairman, I thank you and look forward to hearing from the
    witnesses.

        Senator Bill Nelson. Okay.
        General?

      STATEMENT OF MAJ. GEN. WILLIAM L. SHELTON, USAF, COMMANDER,
      JOINT FUNCTIONAL COMPONENT COMMAND FOR SPACE, UNITED STATES
                           STRATEGIC COMMAND

        General Shelton. Mr. Chairman and members of the
    subcommittee, it's a pleasure for me to be here with you today.
        I wear two hats. I'm the 14th Air Force Commander, but I'm
    also Strategic Command's (STRATCOM) Joint Functional Component
    Commander for Space. It's in that latter role that I appear
    before you today. I look forward to your questions. So, I'll be
    looking at the operational perspective of STRATCOM.
        [The prepared statement of General Shelton follows:]

            Prepared Statement by Maj. Gen. William L. Shelton, USAF

        Chairman Nelson, Senator Sessions, and members of the subcommittee:
    I am honored to be here today alongside distinguished members of the
    panel: Under Secretary of the Air Force, Hon. Ron Sega; General Kevin
    Chilton, Commander of Air Force Space Command; Vice Admiral James
    McArthur, Jr., Commander of Naval Network Warfare Command; and Cristina
    Chaplain, Director of Acquisition and Sourcing Management, Government
    Accountability Office. This is my first opportunity to appear before
    you as United States Strategic Command's (USSTRATCOM) Commander of the
    Joint Functional Component Command for Space (CDR JFCC SPACE), and it's
    a pleasure to be able to address you on our space posture.
        I know this subcommittee is fully aware of the growing importance
    of space capabilities to our national security, as well as to our
    overall economic prosperity. Today, I will provide you an update on our
    efforts to efficiently and effectively employ our vital space
    capabilities, highlighting our top priorities, and identifying the
    challenges we face in fulfilling both national and combatant commander
    objectives.

                        EMPLOYMENT OF SPACE CAPABILITIES

        In July 2006, General Cartwright, the Commander of USSTRATCOM, in
    coordination with the Chief of Staff of the Air Force, directed the
    creation of JFCC SPACE, and assigned the Commander, 14th Air Force, the
    dual role of CDR JFCC SPACE. While I serve in both roles, it's in the
    CDR JFCC SPACE position that I am designated as the single point of
    contact for military space operational matters. Additionally, JFCC
    SPACE is responsible for providing tailored, responsive, local, and
    global space effects to supported combatant commanders. My USSTRATCOM-
    delegated authorities include Global Space Coordinating Authority,
    which empowers me to be the primary interface with supported commanders
    for operational-level planning and execution of space forces in support
    of combatant commander objectives. CDR JFCC SPACE is also assigned
    Operational Control and Tactical Control authorities for designated,
    worldwide space operations and missile warning forces. Finally, JFCC
    SPACE supports the Commander, North American Aerospace Defense Command
    (NORAD) by providing the missile warning and space surveillance
    capabilities necessary to fulfill the U.S. commitment to the NORAD
    Agreement. By establishing the CDR JFCC SPACE, USSTRATCOM provides a
    single commander, with a global perspective, to enhance functional
    integration of space capabilities for the joint warfighter and the
    Nation.
        Just in the last year, two significant world events have galvanized
    our thinking by highlighting both the importance and the potential
    fragility of our Nation's space capabilities. The first event occurred
    during our initial month of operation--the July 2006 North Korean
    launch of a Taepo Dong-2 (TD-2) missile. The second event was the
    January 2007 Chinese test of a hit-to-kill anti-satellite (ASAT)
    capability. Interesting enough, this test occurred 6 years to the day
    after the publication of the 2001 Space Commission Report, which had
    warned of growing threats to our space capabilities. In both events,
    JFCC SPACE coordinated pre-launch indications and warning campaigns,
    then provided space-based tracking of the boosters during flight, which
    helped shape the national response. We worked closely with our
    USSTRATCOM global mission partners and various agencies to ensure space
    capabilities were available to support potential contingencies and
    courses of action. For the ASAT test, we tracked the resultant debris,
    and we continue to assess the additional risk posed by the debris to
    our satellites and the International Space Station. These events
    foreshadow a future that appears increasingly challenging. Our near-
    term priorities, which include increasing our Space Situational
    Awareness (SSA) capabilities and strengthening and formalizing
    departmental and interagency relationships, are certainly informed by
    our experience from these two events.
        One of our most important lessons learned was that our current
    systems processing such events are not sufficiently dynamic.
    Outstanding people overcame these limitations by arranging manual data
    and voice workarounds, but clearly, this should not be how we conduct
    space command and control operations in the future.
        Strengthening unity of command and unity of effort is critical in
    executing timely actions to preserve space effects for the Nation.
    Organizationally, we are taking steps to gain better access to limited
    resources. Among these include dual-hatting the Deputy Commander of
    JFCC SPACE (DCDR JFCC SPACE) with the National Reconnaissance Office's
    Deputy Director for Mission Support (NRO/DDMS). This designation will
    help strengthen the bonds between NRO space operations and Department
    of Defense (DOD) space operations. We are constantly searching for
    opportunities to synergize efforts and leverage existing resources in
    the employment of space capabilities. Unity of effort in tactics,
    techniques, and procedures, underpinned by a net-centric system
    designed to provide both enhanced SSA and operational-level command and
    control, will strengthen JFCC SPACE operations.
        To ensure USSTRATCOM, through JFCC SPACE, can deliver persistent
    space effects in support of both national and combatant commander
    objectives, we rely on the Services, under the able coordination and
    direction of the DOD Executive Agent for Space, Dr. Sega, to acquire
    the space systems we need to maintain our tremendous advantage in
    space. I thank Dr. Sega for his leadership in our Nation's space
    capability development. Through his efforts, and those of our talented
    sailors, soldiers, airmen, and marines, we are able to enhance the
    quality of current space effects and ensure continuity of services in
    our position, navigation, and timing (PNT), missile warning, satellite
    communications, and environmental monitoring capabilities.

                                   CHALLENGES

        Our Nation's growing dependence on space-based capabilities creates
    a corresponding potential vulnerability. Therefore, preserving our
    space-based capabilities against intentional and unintentional events
    will be a growing challenge as more entities gain access to the space
    domain.
        We currently track over 16,000 artificial objects in space, to
    include everything from active satellites to launch-related debris.
    Although this is certainly a large number of objects, there are many
    more that are too small for our space surveillance sensors to track. As
    the number of objects increases, so does the potential for a
    catastrophic collision in space. The addition of over 1,600 pieces of
    trackable debris from the Chinese ASAT test further complicates the
    problem.
        Along with the growing debris population, there are many other
    current and developing threats to our space capabilities. To fully
    understand the potential threat to national assets, DOD payloads,
    commercial space satellites, and manned space systems, we depend on
    both ground- and space-based space surveillance sensors.
        Every commander strives for the best situational awareness possible
    before he/she engages in operational activity. For space operations,
    this imperative is especially true, given our investment in space, our
    dependence on space capability, and the difficulty of replacing assets
    following an unexpected loss. As the threats to our space assets grow,
    our ability to provide robust SSA must grow commensurately. We will
    become increasingly dependent; on the availability of a persistent,
    predictive, dynamic SSA capability. The success of our space operations
    will hinge on a decisionmaker's ability to quickly answer the ``who,
    what, when, where, how, and why'' questions, as he/she determines a
    course of action to support our national security objectives. We must
    have thorough, decision-quality, knowledge of all constituent parts of
    SSA: the space environment conditions, the space debris situation, the
    status of blue forces, and the intelligence picture, which includes
    enhanced information on potential adversary space capabilities and
    intent.
        An increasingly threatened, dynamic environment will drive us to
    highly automated, net-centric capabilities. Machine-to-machine
    interfaces will enhance decisionmakers' ability to quickly and
    accurately assess emerging space capabilities and threats. The net-
    centric data sharing that will occur will allow much easier integration
    of disparate data, enhancing the overall situational awareness of the
    warfighter. I thank General Chilton for his strong leadership and
    commitment to making SSA a top priority within Air Force Space Command.
    He is driving hard toward vastly improved SSA to provide that crucial
    underpinning for JFCC SPACE operations.

                                   CONCLUSION

        Space operations are changing rapidly. Dynamically taskable
    satellites, increasing threats to the space environment, and the
    dependence on space, are all key factors that drive our decisions on
    the future of operational command and control in JFCC SPACE. It's an
    exciting time to be in the space business, and I am privileged to
    command the men and women who employ these great space capabilities for
    our Nation. I thank you for your time and attention, and for your
    assistance in preserving the vital space capabilities for our national
    security.

        Senator Bill Nelson. Admiral?

    STATEMENT OF VADM JAMES D. McARTHUR, JR., USN, COMMANDER, NAVAL
                        NETWORK WARFARE COMMAND

        Admiral McArthur. Mr. Chairman, distinguished members, I'm
    Vice Admiral Jim McArthur from Naval Network Warfare Command.
        Our responsibilities are to provide C4 systems, information
    operations, and space affects to Navy component commanders
    arrayed globally. We're also a functional component of U.S.
    STRATCOM. The Navy's had a long history in space, both as a
    consumer and an operator. We feel like maritime security,
    maritime domain awareness, and force net will continue to rely
    on that.
        In fact, the interdependency will grow enormously. I look
    forward to discussing those interdependencies with you. We need
    assured and responsive space, space effects, and fortunately
    those are being provided today with the component of U.S.
    STRATCOM.
        It's an honor to appear before you, and I look forward to
    the questions, sir.
        [The prepared statement of Admiral McArthur follows:]

             Prepared Statement by VADM James D. McArthur, Jr., USN

        Mr. Chairman and distinguished members of the subcommittee, as the
    Commander of Naval Network Warfare Command, I am honored to appear
    before you today to address Navy space activities. Naval Network
    Warfare Command is responsible for providing operational network,
    information operations, and space effects, as a supporting commander to
    Navy component and joint commanders.
        The Chief of Naval Operations (CNO) pointed out our two unique Navy
    attributes--global reach and persistent presence--during his 23 March
    2007 fiscal year 2008 posture hearing. This means we as a Navy must be
    prepared to conduct major combat operations, address asymmetric
    threats, as well as provide maritime security in a variety of ways in
    an ever changing world. The value that the Navy brings in terms of
    regional security, global stability, and anti-access capabilities is
    undeniable. All of this requires space capabilities that are rapid,
    dynamic and assured. Space can be viewed as a classic inter-dependency;
    Naval component commanders depend on U.S. Strategic Command to provide
    Department of Defense (DOD) and national space effects, essential for
    successful naval operations. I will share with you what we are doing as
    part of the joint space team.

                      SPACE SUPPORT TO THE NAVY WARFIGHTER

        Warfare today and in the future will be about speed and having
    superiority in the information domain--acting quickly in the global
    commons of the seas, space, and cyberspace before an adversary
    saturates or penetrates our defenses. It will also be about
    persistence--having the duration and vantage point to find threats and
    counter them with precision. Space capabilities are a critical enabler
    for maritime operations. They provide the foundation through which data
    is rapidly collected, fused, correlated and disseminated to build
    Maritime Domain Awareness and support the National Strategy for
    Maritime Security. In general, naval warfighters need global coverage,
    wide-area active and passive surveillance capabilities, robust jam-
    resistant communications, and position, navigation and timing
    information for core Navy warfighting competencies, deterrence
    missions, and stability operations.

                           NAVAL SPACE CAMPAIGN PLAN

        The Naval Space Campaign Plan is my blueprint for operationalizing
    space support to the maritime warfighter. As we implement and execute
    the plan, we are breaking new ground in the Fleet's operational
    employment of space effects. NETWARCOM's NetOps, IO, and Space Center
    (NIOSC) functions as a true reachback staff element for deployed Strike
    Groups and forward Maritime Headquarters. The space planners in the
    NIOSC broker maritime operational and exercise space needs with the
    Joint Space Operations Center at Vandenberg Air Force Base and assist
    the theater Space Coordinating Authorities as they develop the space
    support requests for their AORs. This insures that the desired DOD and
    national technical space effects are delivered in support of fleet
    activities. Concurrently, NETWARCOM is formalizing the fleet's training
    and exercise play. By advancing the fleet's space systems knowledge
    through regular staff training sessions and standardizing the way the
    fleet trains during FRTP to fight in an environment with mature threats
    to our space systems, we are ensuring our strike groups and staffs are
    equipped to fully leverage and integrate joint and national space
    capabilities and operate against a regional space peer.

                             THE NAVY'S INVESTMENT

        The Navy's space investment portfolio reflects our partnership with
    the Department of Defense's Executive Agent for Space and the rest of
    the National Security Space community--as well as our maritime
    responsibilities. We recognize our reliance on the Air Force and
    National Reconnaissance Office (NRO) to acquire most of the major space
    platforms. The Navy's Space Cadre works closely with them to
    collaborate on meeting maritime requirements. We also take the lead in
    tackling maritime challenges through our participation in the science
    and technology (S&T)/research and development (R&D) process. Our
    Tactical Exploitation of National Capabilities office works closely
    with the NRO to develop new technologies and techniques to collect and
    exploit against emerging naval threats, including developing
    operationally responsive payloads.
        In addition to our major space segment responsibility for
    narrowband satellite communications (SATCOM), which I will talk about
    more specifically in a moment, my organization is leading change in two
    key areas that will make our Navy more capable of fully leveraging
    space capabilities. First, we are using a combination of military and
    commercial satellite capabilities to increase available bandwidth. In
    conjunction with this effort, we are investing in the dynamic
    management of existing bandwidth (i.e., Automated Digital Network
    System, new modems, etc). Together, these strategies will be used to
    deliver our warfighting requirements, enabling the Naval Operating
    Concept vision of ``distributed network operations.'' These increased
    capabilities will further enhance education and training opportunities
    available at sea and support other quality of service aspects expected
    by the Millennium Generation. Second, we are breaking the link between
    software and hardware by moving to an open architecture approach.
    Through strong governance and fiscal discipline, we are developing a
    Service Oriented Architecture to enable lower cost upgrades, reduce
    equipment costs, and rapidly insert new technology. Our goal is to
    ensure the capacity and flexibility to rapidly integrate space, as well
    as capabilities from other platforms, into our architecture.

                          MOBILE USER OBJECTIVE SYSTEM

        The Navy's major space segment responsibility to the joint
    community is the narrowband satellite communications constellation.
    Today it consists of Ultra High Frequency (UHF) Follow-on (UFO) and
    Fleet Satellites (FLTSATs) which will begin to be replaced by the
    Mobile User Objective System (MUOS) in 2010. MUOS will provide
    communications-on-the-move, through double canopy foliage and in urban
    environments to small antennas used by disadvantaged users (handhelds,
    aircraft, missiles, unmanned aerial vehicles (UAVs), remote sensors) in
    stressed environments (foliage, urban environment, high sea state).
    MUOS is the common denominator for command and control providing the
    capability to communicate from tactical to theater levels, to allies
    and coalition partners, and between defense and nondefense agencies.
    MUOS will allow a more comprehensive and coordinated approach to
    regional engagement, providing the capability to synchronize efforts
    with other Services, agencies, and allied nations.
        MUOS is critical to satisfying the demand for tactical satellite
    communications. During Operations Enduring Freedom and Iraqi Freedom,
    UFO, FLTSAT, and LEASAT 5 were only able to support 80 percent of the
    narrowband tactical UHF satellite communication requirements.
    Additionally, in the 2010 timeframe, LEASAT 5 will reach its end of
    service life, and the UFO constellation, based on new analysis after
    the premature UFO 9 failure, is expected to reach an unacceptable level
    of availability in May 2008. We have a mitigation plan to minimize the
    operational impact of a potential gap in capability (seven operational
    satellites vice the required eight) before MUOS is operational. It
    includes the use of commercial bandwidth and the dynamic management of
    existing bandwidth as mentioned previously. Today, UFO supports
    approximately 500 simultaneous accesses worldwide. Based on evolving
    future war fighting concepts in support of the Defense Planning
    Guidance, UHF SATCOM access requirements are expected to grow by at
    least a factor of four and MUOS, as designed, will be able to support
    that requirement.
        Since last year the MUOS program successfully completed the Key
    Decision Point (C) milestone and the Critical Design Review phase. The
    program is currently on schedule and within budget to meet an On-orbit
    Capability in 2010 and is fully funded in the President's 2008 Budget
    to meet all threshold requirements. The MUOS program is currently
    preparing for the October 2007 Build Decision (for satellites 1 and 2).
    MUOS will bring a 4-fold increase in the number of accesses (1997 vice
    500) and a 20-fold increase in throughput (39.2 Mbps, total system
    capacity vice 2 Mbps) worldwide while providing improved communications
    on the move to disadvantaged platforms (hand held terminals, aircraft,
    missiles, UAVs, remote sensors) at higher data rates (up to 64 kbps per
    access). This capability can only be realized with the fielding of MUOS
    capable Joint Tactical Radio System terminals or by upgrading existing
    UHF legacy software programmable terminals.

                               SPACE ENVIRONMENT

        Navy depends on space capabilities now and expects the demand for
    space capabilities in the future, especially for SATCOM, to increase.
    We, like the rest of the Nation's leadership, were concerned by China's
    recent anti-satellite test, not only for its primary purpose of
    demonstrating a capability against spacecraft, but for the collateral
    effects of the debris created. That said, we recognize that all space
    capabilities are vulnerable to both low and high technology threats,
    including communication and data link jamming, attempts to exploit or
    disrupt computer systems, attacks against the sensors, and physical
    attack against the ground infrastructure. Although space threats can
    not be completely eliminated, Navy is embarking on a multi-pronged
    approach to minimize their potential impact on naval operations. We
    started with an internal study on space vulnerabilities in 2005 and
    have identified opportunities for action. First, Navy will have
    multiple communications paths available, including extremely high
    frequency (EHF), UHF, and super high frequency, as well as commercial
    systems. While we eagerly await the leap in communications capability
    that the Transformational Satellite (TSAT) will bring, the requested
    funding for an additional Advanced Extremely High Frequency satellite
    will improve protected communication capability in the near-term. Also,
    for our battlespace and maritime domain awareness needs, we will
    leverage a variety of sensors, including airborne and space based, and
    ensure a balance between sea and shore based intelligence analysis and
    processing capabilities. Finally, we are examining nonmaterial
    solutions, such as planning and training for degradation of space
    capabilities. As I've already mentioned, the NIOSC is currently
    providing focused space support to the Eisenhower, Stennis, and Bataan
    Strike Groups as part of the Naval Space Campaign Plan, with the goal
    of providing tailored space capabilities to improve the mission
    effectiveness of the fleet.
        The Navy is working with U.S. Strategic Command to ensure
    comprehensive space intelligence is provided and appropriate means of
    protection are addressed systematically as space systems and their
    concept of operations are being developed. We communicated to Strategic
    Command the need for a balanced Space Control portfolio to ensure
    appropriate emphasis on protection and space situational awareness. As
    both the Secretary of the Navy and CNO have noted, we cannot allow
    ourselves to be fixated on one threat alone. Therefore, our collective
    efforts must take a broad-based perspective on the threat to space
    capabilities.

                         OPERATIONALLY RESPONSIVE SPACE

        Navy supports Operationally Responsive Space (ORS) because maritime
    forces need the flexibility that ORS offers to augment and reconstitute
    critical warfighting capabilities in order to counter increasingly
    agile adversaries. Navy actively participated in the congressionally
    directed 120-day ORS study and will be an integral part of the ORS
    organization once a joint office is established. Building on over 50
    years of small satellite experience, Navy is working closely with the
    Services, combatant commands (COCOMs), and the Intelligence Community
    to develop key elements of ORS through the TacSat series of
    experiments. We realize that ORS is more than just smaller, rapidly
    developed satellites and requires an end-to-end examination to develop
    the agility and capabilities needed to rapidly adapt to the ever
    evolving threat environment facing our Joint Force Commanders (JFC).
        As part of the joint TACSAT and ORS effort, the Office of Naval
    Research (ONR) is investing $15 million of S&T funds each year in
    moderate-to-high-risk projects that result in significant prototypes
    through the Space Innovative Naval Prototype program. Investments are
    focused on naval capability gaps that space can fill such as ship
    tracking, data exfiltration from buoys, communications-on-the-move,
    submarine detection, cueing, and littoral characterization. TACSAT-2
    was launched on 16 December 2006 and is undergoing testing. Commander
    Strike Group-8 is interested in leveraging one of its secondary
    payloads, built by the Naval Research Laboratory (NRL), for ship
    tracking and input into maritime domain awareness. We are looking
    forward to launching TACSAT-1 later this year after SpaceX gives the
    go-ahead for launch on its Falcon-1 rocket. NRL also built a secondary
    payload for TACSAT-3 that provides a basic IP-based data exfiltration
    capability. NRL is leading TACSAT-4 for the joint community with ONR
    funding the UHF Communications payload to support comms-on-the-move and
    data exfiltration. TACSAT-4 uses a prototype spacecraft bus resulting
    from a broad government-industry team effort to develop and mature bus
    standards for increased modularity. The spacecraft should be completed
    by the first half of next year and will be launched into a highly
    elliptical orbit to provide long dwells over theater. The TACSAT series
    of experiments reflect the partnerships that need to be developed
    between the Services, COCOMs, and Intelligence Community to innovate
    solutions and leverage the best talent available across the national
    security space community to solve warfighting challenges. NRL is
    managing the ORS Payload Technology initiative for the Office of the
    Secretary of Defense. This initiative jointly evaluated 75 industry
    proposals and awarded 14 which are being developed by industry now and
    over the course of the next year.
        The ORS attributes of flexibility and agility not only impact the
    current operational environment but also have the potential of
    positively affecting the space industrial base. The shorter project
    cycles should provide a broader base of rapid response experience for
    the space industry and space cadre, and will establish a faster
    acquisition rhythm in the long run.

                                    SUMMARY

        Our mission of keeping the air and sea lanes open and ensuring the
    security of our citizens at home and abroad requires a global reach and
    persistent presence. We must be constantly ready, whether it is to
    deliver on a mission of mercy or more lethal measures to respond to a
    specific threat. Our ability to respond, as well as work with our
    coalition and other maritime partners, will depend on space
    capabilities for the necessary flexibility and speed to support our
    worldwide responsibilities. To deliver the required space capabilities
    to the warfighter and represent the Navy's interest in space, we will
    continue to invest in our most valuable resource, our people, the Navy
    Space Cadre.
        The Navy remains committed to shaping space system capabilities and
    fully integrating those capabilities into maritime operations. We look
    forward to participating in ORS, as well as delivering MUOS for the
    joint warfighter.
        Thank you for the opportunity to share our efforts with you today.

        Senator Bill Nelson. Thank you, Admiral.
        Ms. Chaplain?

     STATEMENT OF CRISTINA T. CHAPLAIN, DIRECTOR, ACQUISITION AND
         SOURCING MANAGEMENT, GOVERNMENT ACCOUNTABILITY OFFICE

        Ms. Chaplain. Thank you for inviting me here today.
        The Government Accountability Office's (GAO) reviews for
    the past several years have painted a pretty bleak picture of
    space acquisitions. We've seen cost increases in billions of
    dollars, schedule delays in years, and performance risks.
    Today, the picture is a bit different, and I would like to
    comment on that.
        On the plus side, we have some of the legacy programs,
    namely the Advanced Extremely High Frequency (AEHF) Satellite
    and Wideband Global Satellite (WGS) overcoming the bulk of
    their technical problems and are on track to meet revised
    targets. Also, more important, the Air Force is adopting what
    we see as best practices for space radar and the
    Transformational Satellite (TSAT). By that, I mean they're
    incorporating mature technologies before the program officially
    begins. They're deferring more ambitious technology efforts to
    the S&T environment and they're spending time defining
    requirements before the program starts. This is not a trivial
    effort.
        I would like to comment that most every space program we've
    reviewed for the past decade has started with fairly immature
    technologies and has had problems setting requirements and
    sticking to them.
        On the minus side, there's still several legacy programs at
    high risk for problems. They include SBIRS High, National
    Polar-Orbiting Operational Environmental Satellite System
    (NPOESS), and GPS IIF. Just looking at SBIRS High, for example,
    we already found that shortly after restructuring, the program
    is starting to diverge from some cost and schedule targets and
    management reserve is being depleted at a much faster rate than
    anticipated.
        We also looked at this new program, the AIRSS, and we had a
    lot of concerns about what the true purpose of the system is,
    whether it's to serve as an insurance policy for the SBIRS High
    or be the follow-on program. Our concerns are rooted into a lot
    of concerns that were transmitted to us from people within DOD.
    There were also a lot of concerns within DOD about schedule
    risks for that program. So, I think those two issues need to be
    addressed before that moves forward.
        I just want to end by making the point that in the larger
    context, the environment is still not very conducive for
    sustaining the good practices we see being adopted in space
    radar and TSAT. The top three obstacles that we see are one,
    workforce capacity, which has already been mentioned here. GAO
    studies and DOD studies have identified deficiencies in program
    management skills, business skills--particularly in cost
    estimating--and technical skills--particularly in systems
    engineering. Programs like TSAT express concerns that they may
    not have the technical people they need in the next year or so.
        Policy is another longstanding concern of ours. The space
    acquisition policy, as it currently stands, does not mandate
    that best practice levels of knowledge be achieved before
    starting the program. So, we would like to see this back-to-
    basics policy be integrated into the formal acquisition policy
    so that the good practices being started now, stay beyond the
    tenures of current leadership.
        The last obstacle, of course, is always funding. There's a
    lot of funding pressures throughout the whole weapons system
    portfolio and a lot of GAO work that has been done tells us
    that programs really need to be prioritized for funding and
    best practices for investment, like portfolio management, need
    to be adopted across the Department, so that programs like TSAT
    and space radar are not incentivized to produce overly
    optimistic reports.
        Thank you.
        [The prepared statement of Ms. Chaplain follows:]

                   Prepared Statement by Cristina T. Chaplain

        Mr. Chairman and members of the subcommittee: I am pleased to be
    here today to discuss the Department of Defense's (DOD) space
    acquisitions. Each year, DOD spends billions to acquire space-based
    capabilities to support current military and other government
    operations as well as to enable DOD to transform the way it collects
    and disseminates information, gathers data on adversaries, and attacks
    targets. In fiscal year 2008 alone, DOD expects to spend over $22
    billion to develop and procure satellites and other space systems,
    including nearly $10 billion on selected major space systems.\1\
    Despite its growing investment in space, however, DOD's space system
    acquisitions have experienced problems over the past several decades
    that have driven up costs by hundreds of millions, even billions of
    dollars; stretched schedules by years; and increased performance risks.
    In some cases, capabilities have not been delivered to the warfighter
    after decades of development.
    ---------------------------------------------------------------------------
        \1\ Estimates of fiscal year 2008 spending on procurement and
    research, development, test, and evaluation are based on DOD's fiscal
    year 2007 Future Years Defense Program (FYDP) plan. The fiscal year
    2008 FYDP plan was not available to us at the time we developed this
    testimony.
    ---------------------------------------------------------------------------
        In view of these problems, the Air Force, DOD's primary space
    system acquirer, has been attempting to instill best, practices in two
    newer space programs--Space Radar and the Transformational Satellite
    Communications System (TSAT). These steps can help better position the
    two programs for success, but they will not work without adhering to
    commitments to delay milestone decisions if there are still gaps
    between requirements and resources, and to use more robust tools to
    analyze risks, costs, and schedule. Moreover, other space programs--new
    and old--are still facing setbacks, reflecting problems in technology
    development or design, problems in managing contractors, and more
    broadly, funding shifts needed to sustain the larger space portfolio.
    Such setbacks--common among all weapons acquisitions--continue to
    hamper the Air Force's ability to provide resources and support needed
    to deliver capabilities within cost, schedule, and performance targets.
    My testimony today will highlight our findings on space acquisitions as
    well as actions needed to address persistent, acquisition problems and
    to build on best practice approaches being adopted in Space Radar and
    TSAT.

        SPACE ACQUISITIONS CONTINUE TO FACE COST AND SCHEDULE INCREASES

        The majority of major acquisition programs in DOD's space portfolio
    have experienced problems during the past two decades that have driven
    up cost and schedules and increased technical risks. Several programs
    have been restructured by DOD in the face of delays and cost growth. At
    times, cost growth has come close to or exceeded 100 percent, causing
    DOD to nearly double its investment in the face of technical and other
    problems without realizing a better return on investment. Along with
    the increases, many programs are experiencing significant schedule
    delays--as much as 6 years--postponing delivery of promised
    capabilities to the warfighter. Outcomes have been so disappointing in
    some cases that DOD has had to go back to the drawing board to consider
    new ways to achieve the same. or less, capability. Some programs have
    been able to work through the bulk of technical problems they were
    facing and are on track to meet revised targets, albeit at higher costs
    and with delayed deliveries. Others, however, continue to face
    setbacks.
        The following chart compares original cost estimates and current
    cost estimates for the broader portfolio of major space acquisitions
    for fiscal years 2007 through 2012. The wider the gap between original
    and current estimates, the fewer dollars DOD has available to invest in
    new programs.

        The next two figures reflect differences in unit costs and total
    costs for satellites from the time the programs officially began to
    their most recent cost estimate. As the second figure notes, in several
    cases, DOD has had to cut back on quantity and capability in the face
    of escalating costs. For example, two satellites and four instruments
    were deleted from National Polar-orbiting Operational Environmental
    Satellite System (NPOESS) and four sensors are expected to have fewer
    capabilities. This will reduce some planned capabilities for NPOESS as
    well as planned coverage. Likewise, the Space Based Infrared System
    (SBIRS) High missile detection program deferred capabilities, such as
    mobile data processors for the Air Force and the Army and a fully
    compliant backup mission control facility, and it pushed off a decision
    to procure the third and fourth satellites, which will not meet SBIRS
    High requirements for coverage. Despite such measures, unit, costs for
    both programs are still considerably higher than originally promised.
    In addition to SBIRS High and NPOESS, the programs featured in the
    figures include the Advanced Extremely High Frequency (AEHF)
    satellites, the Wideband Global SATCOM (WGS) and the Mobile User
    Objective System (MUOS), which are all communications satellites, and
    the Global Positioning System (GPS) II.

        The next chart highlights the additional estimated months needed to
    complete programs. These additional months represent time not
    anticipated at the programs' start dates. Generally, the further
    schedules slip, fee more DOD is at risk of not sustaining current
    capabilities. For this reason, DOD began an alternative infrared system
    effort, known as the Alternative Infrared Satellite System (AIRSS), to
    run in parallel with the SBIRS High program.

        Some programs, such as AEHF and WGS, have worked through the bulk
    of technical and other problems that were causing large schedule
    increases and cost delays. For example, the AEHF program, which has
    been in the final stages of development for almost 3 years, resolved
    issues related to its cryptographic equipment and is on track to meet a
    revised date for first launch. The WGS program completed rework on
    improperly installed Fasteners, and contractors have redesigned
    computers to rectify data transmission errors. The program expects a
    first launch in June 2007. As noted in our figures, the MUOS program,
    which began more recently than AEHF and WGS, is generally meeting its
    targets, though it has yet to enter into the more difficult stages of
    satellite production, integration and test.
        By contrast, the SBIRS High program still faces considerable risks.
    Recent GAO work for this subcommittee, for example, shows that the
    program is diverging from cost and schedule targets just months after
    rebaselining due to problems related to assembly, integration, and
    testing and that the contractor's estimates for addressing these issues
    are overly optimistic. Defense Contract Management Agency reports also
    show that software development efforts are behind schedule--by as much
    as 32 percent. In addition, the contractor has already spent about 28
    percent, or $66 million, of its management reserve from April 2006 to
    November 2006. This reserve is designed to last until 2012, but at the
    current rate, is likely to be depleted by May 2008. If this trend
    continues, $500 million in additional reserve will be needed. As noted
    earlier, DOD initiated an alternative effort--AIRSS--to ensure it would
    have continued capabilities. However, we have questions as to whether
    AIRSS is being pursued as a ``plan B'' program, as originally
    envisioned. Rather than seek to maintain continuity of operations, the
    program is focused on advancing capabilities because program managers
    believe there are no viable alternatives. We also found that there was
    disagreement among DOD stakeholders as to whether there were
    alternatives or not, and there was concern that the AIRSS schedule may
    he too compressed. Our analysis also found that there was a high degree
    of concurrency in the program's schedule, which may be limiting DOD's
    ability to gain knowledge from planned demonstrations and increased the
    potential for costly rework further in the program.
        The GPS Block IIF program is also al a high risk of cost increases
    and schedule delays. Since our last, annual assessment of the GPS Block
    IIF program, the program has revised its acquisition program baseline
    to account for cost increases and schedule delays, and requested an
    additional $151 million to cover these costs. The number of IIF
    satellites to be procured was reduced from 19 to 12. Further, the
    launch date of the first IIF satellite continues to slip. The original
    baseline showed an initial launch availability date of December 2006,
    but DOD's current baseline shows July 2009--a slip of about 2.5 years.
    The program also learned that the contractor's earned value management
    reporting system was not accurately reporting cost and schedule
    performance data. A DOD report also recently found that development of
    user equipment has not been synchronized with the development of
    satellites and control system, increasing the risk of substantial
    delays in realistic operational testing and fielding of capabilities.
    GPS is taking measures to address these problems. For example, this
    year, it did not award its contractor $21.4 million in award fees. In
    December 2005, GAO recommended that DOD improve its use of award fees
    for all weapon system contracts by specifically lying them to
    acquisition outcomes. A review of a sample of programs, including SBIRS
    High, found that this was generally not done.
        The NPOESS program is also still at risk of more cost increases and
    schedule delays. In June 2008, DOD certified the NPOESS program to
    Congress, and with agreement from its program partners, DOD
    restructured the program. Now the NPOESS program acquisition costs are
    estimated to be about $11.5 billion--an increase of about $3 billion
    over the prior cost estimate. Before the contract was awarded, in 2002,
    the life cycle cost, for the program was estimated to be $6.6 billion
    over the 24-year period from the inception of the program in 1995
    through 2018. The delivery of the first two NPOESS satellites has been
    delayed by roughly 4 and 5 years, and as noted earlier, the number of
    satellites to be produced has been reduced from six to four. In
    addition, the number of instruments was reduced from 13 (10 sensors and
    3 subsystems) to 9 instruments (7 sensors and 2 subsystems), and 4 of
    the remaining sensors will have fewer capabilities. The NPOESS program
    will incorporate any number of the deleted instruments if additional
    funding is provided from outside the NPOESS program. The program
    restructure will result in reduced satellite data collection coverage,
    requiring dependence on a European weather satellite for coverage
    during mid-morning hours. Although the program has reduced the number
    of satellites it will produce, the cost per satellite is more than 150
    percent above the original approved program baseline. The NPOESS
    program is now updating the cost, schedule, performance baselines, and
    acquisition strategy, and coordinating the changes with the three
    agencies. The program expects these documents to be approved later this
    year. While work is continuing on key sensors, the program still faces
    potential problems in their development.
        The Space Based Space Surveillance (SBSS) system--not featured on
    the charts above because it is not yet a formal acquisition program--is
    also encountering problems. The SBSS system is to replace an aging
    sensor on an orbiting research and development satellite and improve
    the timeliness of data on objects in geosynchronous orbit. As currently
    planned, the initial block will consist of a single satellite and
    associated command, control, communications, and computer equipment.
    Subsequent SBSS efforts will focus on building a larger constellation
    of satellites to provide worldwide space surveillance of smaller
    objects in shorter timelines. In late 2005, an independent review team
    found that the program's baseline was not executable; that the
    assembly, integration, and test plan was risky; and that the
    requirements were overstated. The SBSS program was restructured in
    early 2006 due to cost growth and schedule delays. The restructuring
    increased funding and schedule margin; streamlined the assembly,
    integration, and test, plan; and relaxed requirements. The launch of
    the initial satellite was delayed to April 2009--a delay of about 18
    months. Cost growth due to the restructure is about $130 million over
    initial estimates.
        Last, additional cost increases are expected for the Evolved
    Expendable Launch Vehicle (EELV) program, but for reasons that are
    different than the ones being experienced on the satellite programs, hi
    recent years, program cost, has risen 79 percent, with a cost per unit
    increase of 136 percent,. A chief reason for cost increases is a
    decline in the commercial launch market upon which the program's
    business ease was based. Cost increases are also a result of additional
    program scope, including mission assurance, assured access to space,
    and earned value management systems reporting. In addition, satellite
    vehicle weight growth and satellite launch delays have contributed to
    cost increases. In December 2006, Boeing and Lockheed Martin Initiated
    a joint venture (United Launch Alliance (ULA)) that will combine the
    production, engineering, test, and launch operations associated with
    U.S. Government launches of Boeing Delta and Lockheed Martin Atlas
    rockets. Though the EELV program office expects long-term savings to be
    achieved through this arrangement, the cost per launch under a recently
    negotiated Buy III acquisition strategy will be higher than under Buy
    I. According to the Air Force, this is because the contractors will
    incur additional costs to allow the government, to perform the
    necessary oversight not required under Buy I. (Exact estimates of the
    new cost per launch have not been finalized by the program office yet.)
    Under the new strategy, EELV will be transitioning from a fixed-price
    arrangement, where launches were essentially procured as a service, to
    a combination of a cost-plus and fixed-price contracts. The arrangement
    will allow the government to exercise more oversight, and to
    incentivize contractors through the use of award fees. But to realize
    these benefits, the Air Force will need to ensure it has resources
    (skills, expertise, and tools) to begin accumulating and analyzing
    detailed cost, schedule, performance, design, and technical data. In
    addition, it will be important to assess progress in achieving longer-
    term savings envisioned under ULA as well as to ensure that the
    combined assets of the contractors are adequately protected.

                UNDERLYING REASONS FOR COST AND SCHEDULE GROWTH

        Our past work has identified a number of causes behind the cost
    growth and related problems, but several consistently stand out. First,
    on a broad scale, DOD starts more weapon programs than it can afford,
    creating a competition for funding that encourages low cost estimating,
    optimistic scheduling, overpromising, suppressing of bad news, and, for
    space programs, forsaking the opportunity to identify and assess
    potentially better alternatives. Programs focus on advocacy at the
    expense of realism and sound management Invariably, with too many
    programs in its portfolio, DOD is forced to continually shift funds to
    and from programs--particularly as programs experience problems that
    require additional time and money to address. Such shifts, in turn,
    have had costly, reverberating effects.
        Figure 5 illustrates the negative cycle of incentives that come
    when programs compete for funding. Table 1 highlights specific areas
    where we found the original cost estimates of programs to be optimistic
    in their assumptions.

              Note: This table was developed as part of a larger review on
            DOD's space cost-estimating function. Information was derived
            from discussions with program and contractor officials and GAO
            analysis. In some cases, programs may have ultimately
            experienced problems related to one of the categories, but we
            did not have evidence to show that the original assumptions
            were optimistic.\2\
    ---------------------------------------------------------------------------
        \2\ ``GAO, Space Acquisitions: DOD Needs to Take More Action to
    Address Unrealistic Initial Cost Estimates of Space Systems, GAO-07-96,
    (Washington, DC: Nov. 17, 2006).

        Second, as we have previously testified and reported, DOD has
    tended to start, its programs too early, that is before it has the
    assurance that the capabilities it is pursuing can be achieved within
    available resources and time constraints. This tendency is caused
    largely by the funding process, since acquisition programs attract more
    dollars than efforts concentrating solely on proving technologies.
    Nevertheless, when DOD chooses to extend technology invention into
    acquisition, programs experience technical problems that require large
    amounts of time and money to fix. Moreover, when the approach is
    followed, cost estimators are not well positioned to develop accurate
    cost, estimates because there are too many unknowns. Put more simply,
    there is no way to estimate how long it would take to design, develop,
    and build a satellite system when critical technologies planned for
    that system are still in relatively early stages of discovery and
    invention.
        A companion problem for space systems is that programs have
    historically attempted to satisfy all requirements in a single step,
    regardless of the design challenge or the maturity of the technologies
    necessary to achieve the full capability. Increasingly, DOD has
    preferred to make fewer but heavier, larger, and more complex
    satellites that perform a multitude of missions rather than larger
    constellations of smaller, less complex satellites that gradually
    increase in sophistication. This has stretched technology challenges
    beyond current capabilities in some cases and vastly increased the
    complexities related to software--a problem that affected SBIRS High
    and AEHF, for example.
        In addition, several of the space programs discussed above began in
    the late 1990s, when DOD structured contracts in a way that reduced
    government oversight and shifted key decision-making responsibility
    onto contractors. This approach--known as Total System Performance
    Responsibility (TSFR)--was intended to facilitate acquisition reform
    and enable DOD lo streamline a cumbersome acquisition process and
    leverage innovation and management, expertise from the private sector.
    However, DOD later found that this approach magnified problems related
    to requirements creep and poor contractor performance. In addition,
    under TSPR, the government decided not to obtain certain cost data, a
    decision that, resulted in the government having even less oversight of
    the programs and limited information from which to manage the programs.
    Further, the reduction In government oversight and involvement led to
    major reductions in various government, capabilities, including cost-
    estimating and systems-engineering staff. The loss of cost-estimating
    and systems-engineering staff in turn led to a lack of technical data
    needed to develop sound cost estimates.

             DOD IS IMPLEMENTING BEST PRACTICES ON TWO NEW EFFORTS

        Over the past decade, GAO has examined successful organizations in
    the commercial sector to identify best practices that can be applied to
    space and weapon system acquisitions. This work has identified a number
    of practices, which we have recommended that DOD adopt. Generally, we
    have recommended that DOD separate technology discovery from
    acquisition, follow an incremental path toward meeting user needs,
    match resources and requirements at program start, and use quantifiable
    data and demonstrable knowledge to make decisions to move to next
    phases. DOD is making efforts to instill these practices on two
    programs reviewed this year: the TSAT and the Space Radar program.
    Specifically:

             Successful organizations we have studied ensure that
            technologies are mature; that is, proven to work as intended
            before program start. Both TSAT and Space Radar are attempting
            to do this. According to their plans, critical technologies
            should reach at least a Technology Readiness Level (TKL) 6 by
            program start, meaning the technologies have been tested in a
            relevant environment. This stands in sharp contrast to previous
            programs, which have started with immature technologies, such
            as SBIRS and NPOESS, and it reflects the implementation of a
            ``back to basics'' policy advocated this past year by the Under
            Secretary of the Air Force. If these programs adhere to the TRL
            6 criteria, they will greatly reduce the risk of encountering
            costly technical delays, though not completely. There are still
            significant inherent risks associated with integrating critical
            technologies and with developing the software needed to realize
            the benefits of the technologies. Moreover, the best practice
            programs we have studied strive for a TRL 7, where the
            technology has been tested in an operational environment, that
            is, space.
             Successful organizations defer more ambitions
            technology efforts to corporate research departments
            (equivalent to science and technology (S&T) organizations in
            DOD) until they are ready to be added to future increments.
            Both programs have deferred more ambitious technology
            development efforts to the S&T environment. TSAT, for example,
            deferred the wide-field of view multi-access laser
            communication technology, and is contributing about, $16.7
            million for ``off-line'' maturation of this technology that
            could be inserted into future increments. It has laid out
            incremental advances in other capabilities over two increments.
            Space Radar has deferred lithium-ion batteries, more efficient
            solar cells, and onboard processing for its first increment,
            and like TSAT, is contributing toward their development by S&T
            organizations. At this time, Space Radar has not defined
            details of an increment beyond the first one.
             Successful organizations extensively research and
            define requirements before program start to ensure that they
            arc achievable, given available resources, and that they do not
            define requirements after starting programs. Both programs have
            also employed systems engineers to help determine achievability
            of requirements. The TSAT program has reached agreement on
            requirements with its users--primarily in terms of what will be
            included in the first, several blocks of the program and what
            will not be included. The Space Radar program has instituted
            several processes designed to achieve consensus on requirements
            across a range of diverse users. It still needs to formalize
            agreement related to these processes and also identify key
            performance parameters. This is important because Space Radar
            is to be shared by the military and Intelligence Communities--
            each with different specific needs for the system and very
            specific roles and responsibilities with regard to the data
            being produced by Space Radar and its users. It has been
            reported recently that conflicts in roles and responsibilities
            have arisen on dissemination of data being produced by a small
            tactical satellite (TACSAT 2) recently launched by DOD for use
            by military commanders.

        It remains to be seen whether TSAT and Space Radar will take
    additional steps that successful organizations take lo position
    programs for success. For example:

             The organizations we have studied do not go ahead with
            program start milestone decisions if there are still gaps
            between requirements and resources. TSAT and Space Radar have
            indicated that they intend to do the same, but there are
            external pressures on both programs to provide needed
            capabilities.
             The organizations we have studied hold program
            managers accountable for their estimates and require program
            managers to stay with a project to its end. We have made
            recommendations to DOD to instill similar practices department-
            wide, but these have yet to be implemented. Further, there are
            still incentives in place to keep program managers' tenures
            relatively short. Promotions, for example, often depend on
            having varied management experience rather than sustained
            responsibility for one program.
             The organizations we studied have developed common
            templates and tools in support data gathering and analysis and
            maintain databases of historical costs, schedule, quality,
            test, and performance data. Cost estimates themselves are
            continually monitored and regularly updated through a series of
            gates or milestone decisions that demand program assess
            readiness and remaining risk within key sectors of the program,
            as well as overall cost and schedules. We saw indications that
            TSAT and Space Radar were using more robust tools to analyze
            risks, costs, and schedule than programs have done in the past.
            However, it remains to be seen how these practices will be
            reflected in official cost estimates. In the past, we have
            found space program estimates were simply too optimistic and
            that independent estimates produced by DOD's Cost Analysis
            Improvement Group were not being used. DOD agreed with our
            findings and asserted it was taking actions to address them.
              actions needed to sustain commitment to improvements
        The Air Force's continued efforts to instill best practices on
    Space Radar and TSAT are good first steps forward addressing
    acquisition problems in the space portfolio. They represent significant
    shifts in thinking about how space systems should be developed us well
    as commitment, from senior leadership. But sustaining these reforms
    will not be easy. The programs are not immune to funding pressures that
    have encouraged too much optimism. They are also being undertaken as
    DOD is addressing shortfalls in critical technical, business, and
    program management skills. Further, processes and policies key to
    sustainment and broader use of best practices have not been changed to
    further reflect the kinds of changes taking place on Space Radar and
    TSAT.
        First, new programs still must compete for limited funding. As DOD
    seeks to fund Space Radar and TSAT, it will be (1) undertaking other
    new, costly efforts, including GPS III, SBSS, and AIRSS; (2) addressing
    cost overruns associated with programs like SBIRS High and GPS; and (3)
    facing increased pressures to increase investments in assets designed
    to protect space systems. In total, these efforts will increase DOD's
    investment for all major space acquisitions from $5.31 billion to $9.22
    billion, or about 46 percent over the next 3 years. Mare may be needed
    if technical, software, and other problems on current programs worsen.
    At the same time, investment needs for other weapon systems are also on
    the rise, while long-term budget forecasts indicate that considerably
    fewer dollars will be available for discretionary spending in coming
    years rather than more.
        In prior reports, we have stated that, as long as too many programs
    compete for too few dollars in DOD, programs will be incentivized to
    produce optimistic estimates and suppress bad news. They will view
    success as seeming the next installment of funds versus delivering
    capability within cost and schedule goals. We have recommended that DOD
    guide its decisions to start space and other weapons acquisition
    programs with an overall investment strategy that would identify
    priorities for funding so that space systems that are expected to play
    a critical role in transformation, such as Space Radar and TSAT, could
    be prioritized along with other legacy and transformational systems.
        Let me take a moment to illustrate why an investment strategy is
    critical. We have reported in the past that DOD and the Air Force have
    waited too long to establish priorities or make trade-off decisions. We
    have also reported that frequent funding shifts have hurt programs that
    were performing well or further damaged troubled programs. We have also
    reported cases where DOD and the Air Force have walked away from
    opportunities to save costs in lot buys or leverage knowledge already
    gained in legacy programs in favor of starting new programs that
    promise much more advanced capability but have little knowledge to back
    up that promise. Today, DOD is on track to cut short the AEHF program
    in order to pursue TSAT. It has stated it may also do the same for
    SBIRS to pursue AIKSS. In both cases, DOD would be forgoing savings
    that it bad already negotiated for lot buys and in effect, paying
    significantly more for nonrecurring engineering. While these decisions
    have the potential to enable DOD to obtain advanced capability sooner
    (provided best practices are followed on the new programs), they should
    have been made much earlier and more strategically in order to stem
    investment losses.
        DOD's own reports recognize that investment planning needs to be
    instilled in weapon acquisitions. A February 2007 report, in response
    to a requirement, in the John Warner National Defense Authorization Act
    for Fiscal Year 2007, outlines steps that. DOD is taking to better
    prioritize and fund programs.\3\ The initiatives include: (1)
    establishing anew concept decision review to provide decisionmakers
    with an early opportunity to evaluate trade-offs among alternative
    approaches to meeting a capability need; (2) testing portfolio
    management approaches in selected capability areas to facilitate more
    strategic choices about how to allocate resources across programs; and
    (3) capital budgeting as a potential means to stabilize program
    funding. While these developments are promising, we recently reported
    that such initiatives do not fundamentally change DOD's existing
    service-centric framework for making weapon system investment
    decisions.\4\ Moreover, it will take some time to determine their
    success in enabling more effective funding prioritization.
    ---------------------------------------------------------------------------
        \3\ Department of Defense, Defense Acquisition Transformation
    Report to Congress (Washington, DC, 2007).
        \4\ GAO, Best Practices: An Integrated Portfolio Management
    Approach to Weapon System Investments Could Improve DOD's Acquisition
    Outcomes, GAO-07-388 (Washington DC; March 30, 2007).
    ---------------------------------------------------------------------------
        Second, space programs are facing capacity shortfalls. These
    include shortages of staff with science and engineering backgrounds as
    well as staff with program management and cost estimating experience.
    During our review this year, the TSAT program cited shortages of space
    acquisition personnel as a key challenge that increases risk for the
    program. Due to broader Air Force cuts in workforce, the program did
    not expect to be able to fill technical positions needed to accompany
    plans to ramp up spending. During our review of DOD's space cost
    estimating function, Air Force space cost estimating organizations and
    program offices said that they believed their cost-estimating resources
    were inadequate to do a good job of accurately predicting costs.
    Because of the decline in in-house cost-estimating resources, space
    program offices and Air Force cost-estimating organizations are now
    more dependent on support contractors. At 11 of 13 program offices we
    informally surveyed, contractors accounted for 64 percent of cost-
    estimating personnel. This reliance raised questions from the cost-
    estimating community about whether numbers and qualifications of
    government personnel were sufficient to provide oversight of and
    insight into contractor cost, estimates. In addition to technical and
    cost estimating skills, DOD and GAO studies have also pointed to
    capacity shortfalls in program management. According to DOD's Young
    Panel report, government capabilities to lead and manage the space
    acquisition process have seriously eroded, in part because of actions
    taken in the acquisition reform environment of the 1990s. During our
    2005 review of program management, we surveyed DOD's major weapon
    system program managers and Interviewed program executive officers, who
    similarly pointed to critical skill shortages in program management,
    systems engineering, and software development. The Air Force and DOD
    recognize these shortfalls and are taking actions to address them, but
    these will take time to implement. It is important that, in the
    interim, the Air Force identify and take steps to grow or retain skill
    sets that should be organic, such as highly specialized knowledge of
    certain military space technologies. During both our cost estimating
    and space system reviews, program officiate noted that it can take
    several years for new technical staff to build knowledge and skills
    unique to military space.
        Our past work has also pointed to capacity shortfalls that go
    beyond workforce. For example, in 2006, we reported that cost
    estimation data and databases are incomplete, insufficient, and
    outdated. In our testimony last year, we pointed to limited
    opportunities and funding for space technologies, and the lack of low-
    cost launch vehicles. It is our understanding that the Air Force and
    DOD are working to address all of these shortfalls. Budget plans show,
    for example, an increase of nearly $11 million in funding for the space
    test program beginning in 2009--about 23 percent.
        Last, policies that surround space acquisition need to be further
    revised to ensure best practices are instilled and sustained. For
    example, DOD's space acquisition policy does not require that programs
    such as TSAT and Space Radar achieve a TRL 6 or higher for key
    technologies before being formally started (KDP B). Instead, it is
    suggested that TRL 6 be achieved at preliminary decision review (KDP C)
    or soon after. Given that there are many pressures and incentives that
    are driving space and other weapon programs to begin too early and to
    drive for dramatic rather than incremental leaps in capability, DOD
    needs acquisition policies that ensure programs have the knowledge they
    need to make investment decisions and that DOD and Congress have a more
    accurate picture of how long and how much it will lake to get the
    capability that, is being promised In addition, although the policy
    requires that independent cost estimates be prepared by bodies outside
    the acquisition chain of command, it does not require that they be
    relied upon to develop program budgets. Officials within the space cost
    estimating community also believed that the policy was unclear in
    defining roles and responsibilities for cost estimators. We continue to
    recommend changes be made to the policy--not only to further ingrain
    the shift in thinking about how space systems should be developed, but
    to ensure that the changes current leaders are trying to make can be
    sustained beyond their tenure.
        In closing, we support efforts to instill best practices on
    programs like Space Radar and TSAT. They are critical to enabling DOD
    to break the cycle of space acquisition problems by matching resources
    to requirements before program start. We encourage DOD to build on this
    momentum by extending a best practice approach to its entire space
    portfolio. For newer efforts, such as AIRSS, this means reexamining
    requirements and alternative means of satisfying those requirements and
    clarifying the true purpose of the program. For current programs, such
    as SBIRS, this means continuing to track risks and dedicating resources
    necessary to mitigate those risks, leveraging management tools such as
    earned value management, analyses, and finding ways to incentivize
    contractors to perform well. For the broader portfolio, this means
    ensuring programs have all the right resources to enable success. These
    include adequate levels of funding accompanied by short- and long-term
    investment plans, adequate skills and capabilities, as well as data,
    policy, and processes, accountability and leadership support.

        Senator Bill Nelson. Dr. Sega, why don't you comment on
    that critique?
        Dr. Sega. I can comment, Mr. Chairman, from the time that I
    have been the Under Secretary of the Air Force, which is since
    August 2005. We did see many of the characteristics that have
    been highlighted by the last set of comments from the GAO. I
    think we've made progress on those issues across the front. In
    the case of GPS IIF, for example, as we dug into GPS IIF in the
    fall of 2005--I wasn't happy with how that program was
    proceeding. But, with Government and industry working together,
    we addressed the technical, management, and financial issues in
    and around the IIF program. Changes were made.
        We had, actually at my request, extended the fixed price
    option time deadline for satellites 10 through 12 from December
    2005 to March 2006 and then to June 2006. By the time we had
    gone through this extensive work, Government and industry had
    completed a thorough Integrated Baseline Review from May into
    June 2006. At that time, I was satisfied we were on track and
    we executed the fixed-price options for satellites 10 through
    12. It took a lot of work. That is one example where we have
    looked at it in detail--at the Work Breakdown Structure Level--
    and did it rigorously and in a disciplined way to see ourselves
    through to the end.
        IIF is now on track. You have to pay attention, though,
    every step of the way. It was not designed from the beginning
    with a back-to-basics approach. We're working hard on events
    that are going to occur in 2007, in terms of thermo-vacuum
    tests and things that are upcoming for that particular
    satellite as we go forward. It is on track, but there are many
    things to watch as we go forward--you pay attention to those
    milestones.
        SBIRS High was a similar situation. Our last review with
    Secretary Krieg on March 20 of this year out in Sunnyvale,
    California, looked through some of the SBIRS activities. There
    was a bit of erosion in the areas that were highlighted--but
    not any what I would consider show-stoppers there. It did not
    have an engineering development unit that we are now enforcing
    in our programs, or a starting point upon which you build the
    flight unit that has more fidelity in it.
        However, at this point we think we, once again, are at a
    point where we have to pay attention and go through some of the
    additional testing. Clearly, the management reserve is divided
    into two parts: some of it is in the contractor's line, and
    some of it is in the Government's line. The Government line of
    management reserve, actually, ends up kicking in, in fiscal
    year 2009 and out. But, we're paying attention to that and so,
    yes, there are some challenges, but not something that can't be
    overcome and dealt with for an approximately on-schedule launch
    of the SBIRS GEO-1 satellite. So, I agree.
        The ``back-to-basics'' approach is succeeding (we
    instituted this plan going forward) to add additional
    discipline into our systems. Some of the systems that were
    begun principally in the 1990s are those that we have to work
    hard on to get them to the point where they'll fly and deliver
    that needed capability.
        Senator Bill Nelson. Okay. As a courtesy to Senator Thune
    and Senator Inhofe, we're going to flip it to you, let you go
    on and ask your questions.
        Senator Inhofe?
        Senator Inhofe. Thank you, Mr. Chairman. I do appreciate
    that very much. I do have some conflicts.
        Let me thank you, both of you, General Chilton and
    Secretary Sega, for coming up to the office and talking about
    some things. You probably have a pretty good idea what my
    concerns are and what I'd like to ask you and get on the
    record.
        Without getting into something that you'd have to go into a
    closed session, I expressed to you my concern as to what
    happened when the Chinese knocked down one of their own weather
    satellites last January, in the same orbit that we would have
    our reconnaissance satellites.
        I'd like to, first of all--even though I think I know what
    your answer is--ask any of you what you think the motivation
    was to do that? Why?
        General Chilton. Sir, we talked about this yesterday. I do
    not know why. It would be purely speculative for me to do that
    at this point.
        Senator Inhofe. Any other comments on that?
        Admiral McArthur. Yes, sir. I would like to add, first of
    all, it was totally irresponsible of the Chinese to do that.
    But second, there's a strategic message involved with this.
    They're seeking parity in space in that particular region.
    They're challenging us in information operations. They
    understand that the information domain is the primary domain of
    the battle space. They wanted to exhibit and demonstrate their
    capabilities.
        Senator Inhofe. Their capability that if something should
    happen, like in the Taiwan Straits, that we would not have the
    capability of seeing what is going on there?
        Admiral McArthur. There is that, some potential of
    degradation of our systems. But, we have a multi-pronged
    approach to overcome, or at least to counter that. It may incur
    more risk for our forces, but without a doubt they understand,
    particularly in the Navy, our dependence on space.
        Senator Inhofe. All right. I was shown a picture I didn't
    have when you were in my office yesterday. This shows
    apparently a 10 percent increase in space junk as a result of
    this little exercise they did.
        Would you explain to us what threat that is or how that
    might affect us adversely?
        General Shelton. Senator, space is vast to start with. So,
    there's a lot of things that are there, but this certainly
    increases the risk to all space-faring nations. So, as this
    debris is created, there's some that went higher than the orbit
    that the engagement occurred at, there's some that's lower, but
    it will take decades for that debris to, literally, rain down
    out of those orbits and enter the earth's atmosphere. So, even
    though the probabilities, the estimated probabilities may look
    fairly low, when the event occurs, the probability is one. So,
    I don't take a whole lot of solace in the fact that the
    estimates say that it's----
        Senator Inhofe. When those of us who are not as well-
    informed looked at how infinite space is, you wonder if that
    can be a problem. But, apparently some do believe it could be.
        Then, just some of the statements that were made yesterday,
    it was in one of the newspapers, written by Edith Linder, that
    a senior Chinese official predicts weapons will be deployed in
    space. You hear these things all the time. Any of you in an
    open meeting want to comment as to some of these statements
    that keep resurfacing over and over again?
        General Chilton. Sir, I'd just comment that it's curious
    that when you read these statements from the Chinese, including
    statements of their interest in participating, for example, in
    the International Space Station Program, and you hear those
    words--and then you observe their activities of actually
    increasing debris in the orbital altitudes where the
    International Space Station operates at, what we're hearing
    doesn't sync up with actions. The actions, I would agree with
    Admiral McArthur, don't make sense and are irresponsible.
        Senator Inhofe. Lastly, let me just ask you the question as
    to how incremental funding would help you in the situation that
    you're facing right now, probably you, Mr. Secretary.
        Dr. Sega. I'd be glad to address that.
        Some of our systems, as we go forward, are very large,
    expensive, and take some time to build. Others, as we go
    forward in operationally responsive space are on the smaller
    side, and take less time to build.
        I'd like to focus on some of the larger satellites.
        In our current rules, in terms of what we need to follow,
    the first two satellites can be built with research and
    development (R&D) types of dollars. But, after that satellites
    must have full funding. So, the large, expensive satellites and
    those that we're not going to build very many of, fall in this
    category. I would like Congress to consider the approval for
    incremental funding of those satellites.
        Now, these capabilities that I mentioned--in terms of
    missile warning, strategic communications, and position
    navigation and timing--we are going to do those for the
    foreseeable future. If we had the opportunity for incremental
    funding, in that larger type of satellites--the more expensive
    satellites--those that we're going to build fewer of--then we
    could smooth out the funding and have greater efficiencies--in
    my belief--in terms of how we develop our investment portfolio
    in those capabilities, develop a rhythm of delivery to the
    warfighter, and delivery of production, and not perturb another
    part of our acquisition program that we also want to have
    investments.
        For example, as we are looking at a decision going forward
    on SBIRS GEO-3 to be made this summer, in the event that it is
    decided to do that program, then we're looking at almost a full
    cost bill of about $1 billion in fiscal year 2009, even though
    it will take some time to actually build it. Now, the authority
    for incremental funding is present at the National
    Reconnaissance Office (NRO) for similar satellites. It's
    present in our NPOESS system that we are doing in conjunction
    with the Department of Commerce, and it's present for our
    carriers in the Navy. So, it's in that class of satellite that
    we would appreciate considerations for incremental funding.
        Senator Inhofe. Yes, I'm glad we had a chance to bring this
    up. I was going to ask the next question about the NRO, since
    they can do it, which probably is more appropriate, if you ask
    me the question. If they can do it, why can't you?
        Ms. Chaplain, do you have any thoughts about that
    incremental funding?
        Ms. Chaplain. I would comment that if this kind of approach
    were adopted, that there should be other mechanisms in place to
    help assess investment progress and what's happening with it on
    an annual basis. For example, you could be asking the Air Force
    each year to identify the cost overruns, the causes for cost
    overruns, what's being done to address cost overruns, and
    trades that could be made within the portfolio or outside the
    portfolio to address funding gaps. So, you would have this
    other measure that would help smooth out funding, but you still
    need some tools to have insight into what's being spent, what
    may need to be addressed in terms of cost overruns and things
    like that.
        Senator Inhofe. Thank you, Mr. Chairman. I think this is
    something we may want to look at ourselves. Because what you're
    talking about, Dr. Sega, is not any more money, it's how it
    comes out, what you're getting for it.
        Thank you, Mr. Chairman.
        Dr. Sega. That is correct, sir. I think the management of
    that will be beneficial from delivering capability, efficiency,
    and cost.
        Senator Bill Nelson. Senator Inhofe, while you're still
    here I want you to hear the answer to this question.
        General Chilton, the Administrator of NASA, in a hearing in
    front of another subcommittee that I chair, minimized his
    answer on the threat of the debris from the Chinese ASAT test.
    Would you give us your opinion?
        General Chilton. Yes, Senator. I'm in line with General
    Shelton's answer. If you look at this purely statistically, one
    might minimize, from a mathematical perspective, the impact of
    this.
        I think also, you have to consider, maybe the context of
    Dr. Griffin talking about the International Space Station,
    which was shielded much more heavily than any of the satellites
    we would put up or the space shuttle, which goes up for a
    smaller period of time and is exposed to the threat less than
    the International Space Station. But in fact, this was over a
    10 percent increase in the amount of debris that was on orbit.
        Dr. Sega and I were on orbit together, or actually this is
    2 years before we were on orbit together, in 1994 there were
    about 8,000 pieces of debris that General Shelton's
    organization was tracking. We're over 15,000 now, and so space
    debris is a problem.
        The United States has worked very hard with the
    international community, with the Russians for example, to take
    measures to mitigate the amount of debris we create on routine
    launches by putting vent valves on our upper stages so there's
    less risk of them exploding once they've done their mission and
    are left on orbit and turning into thousands or hundreds of
    little pieces as opposed to just one you can track.
        So, it is significant, in my mind, that a country would go
    off and intentionally increase the debris field in an orbital
    regime, where not only humans operate in, but critical national
    security space assets for the United States operate in,
    commercial assets operate in, like Iridium Constellation and
    other communications satellite. To test and demonstrate that
    capability, one has to ask, are they considering deploying that
    and fielding that? Because if you go down that path, and with
    intent to use, you're not going to be going after a small
    weather satellite, but some larger satellites and some other
    satellites that will further exacerbate the problem.
        So, I am concerned, absolutely concerned, about the
    activities that the Government of China conducted with regard
    to this test.
        Senator Bill Nelson. This Senator thinks it's absolutely
    inexcusable for China to have done this and multiplied the
    amount of debris. Generally, in all of your private
    conversations with other users of space, be it American
    commercial, be it international commercial, be it partners in
    space, what have they said to you privately about this fact of
    a 10 percent increase?
        General Chilton. Sir, I have not had conversations with
    commercial users with regard to that increase. I can tell you,
    though, that my experience shared by you on orbit, is that
    manned space flight is not interested in operating in
    environments with increased debris. Because what General
    Shelton can see with his sensors, we closely coordinate with
    NASA to make sure they can maneuver and avoid.
        What worries me most is what we can't see. On every single
    space shuttle flight I was on, the three, after landing we had
    to replace windows in the space shuttle orbiter from hitting
    very, very, very small pieces of debris, paint fleck size
    pieces of debris. They cause enough damage to damage the
    thermal-pane outer window on the space shuttle, which is not a
    big cross-section to be dragging through space.
        So, I can't emphasize enough my concerns about the
    increasing debris in this regime.
        Senator Bill Nelson. If a paint chip will do that much
    damage to the window, what would a bolt do, coming at a 90-
    degree angle?
        General Chilton. It certainly has the capability of
    destroying a satellite.
        Senator Bill Nelson. General?
        General Shelton. We're concerned about anything, probably
    in about the three centimeter size or larger being catastrophic
    to our space craft. We are tracking 1,700 pieces, roughly, from
    the Chinese ASAT test right now. Our modeling says there are
    tens of thousands of pieces larger than one centimeter. So, if
    you look at orbital velocities and even those small mass
    objects, they cause catastrophic damage if they occur at the
    angles that you talked about. It's all dependent on geometries
    and orbital velocities, but that's the potential.
        Senator Bill Nelson. Do the commercial users of space have
    an appreciation for this subject?
        General Shelton. Yes, sir. Again, only the objects we can
    track. But, of those objects we can track, we are tracking the
    potential collisions between pieces of debris and all the
    satellites that are in the things that we have in our space
    catalogue. When it appears that we will have one of these
    conjunction opportunities, we call that commercial provider and
    we tell them that it's going to be this close by our estimates.
        Senator Bill Nelson. Where is the outrage among the
    commercial users as a result of this spreading of debris?
        General Shelton. Senator, the outrage is there. It may not
    have become public. As you go to various symposia, you hear it
    from the operators. They are very concerned.
        Senator Bill Nelson. Anybody else want to comment on this?
    Okay.
        Senator Sessions. General Shelton, how much of a burden has
    been put on you to track those additional debris pieces?
        General Shelton. It's not the tracking, Senator. It's
    really analyzing the tracking data, and predicting those
    conjunction opportunities. That's a tremendous burden on our
    people. Our systems aren't automated enough that it just spits
    that out for us in a routine way. It takes an analyst to take
    the data offline and look at it very closely. So, it is a
    burden.
        Senator Sessions. I thank the chairman for raising this
    directly, because I just don't think it's a good citizen act by
    the Chinese Government, I think we should be forceful and clear
    about our concerns and I thank you for expressing that.
        Senator Bill Nelson. The Chinese have put up two
    Taikonauts. They're at risk too and that's human, not even to
    speak of their government assets that they have up there, so I
    think it's time for some of us to start speaking out and making
    it really clear to the Chinese just what a dastardly act that
    they've done. They can do their ASAT stuff and show their
    technological prowess, but when you start messing around,
    completely polluting space, that it becomes a hazard for both
    man and machines, then it's a different thing.
        Senator Thune.
        Senator Thune. Thank you, Mr. Chairman.
        I want to welcome the panel before us today. Thank you for
    your very important service to our Nation.
        We are a Nation, of course, that's heavily dependent upon
    our satellite system, not only for the day-to-day capabilities,
    communicating instantaneously around the globe, but even
    providing driving directions to our cars so that we can get
    places instead of getting lost. There have been a lot of
    advantages, obviously, and few things are more important,
    however, than the tremendous capabilities and advantages our
    satellites provide to our military and intelligence
    communities. As such, they're very important to the national
    security of the United States.
        As has already been touched on, we now know that these
    capabilities are held at risk after the Chinese test of an
    anti-satellite missile and have to work even harder to preserve
    and expand our space programs. I think this hearing is
    important in that regard because it will help us better
    understand what those challenges are and how to overcome them.
    I appreciate Chairman Nelson and Senator Sessions for having
    the hearing today.
        Dr. Sega, you mentioned in your opening statement that one
    of your key priorities was not having a gap in missile defense
    capabilities. When the Airborne Laser (ABL) becomes
    operational, it will be an Air Force asset. One of the unique
    aspects of the ABL is its ability to engage in the missile
    defense fight without the help of satellites. It is a stand-
    alone platform that can track and destroy all classes of
    ballistic missiles, and can also communicate with other defense
    platforms that do rely on satellites. So, I guess the question
    is, as the Under Secretary for the Air Force and the Executive
    Agent for Space, can you comment on the usefulness of having
    that kind of an autonomous, highly mobile platform available
    that would bring to flight, given its capability to operate
    independently and operate with other platforms if we had a
    problem or attack on our missile defense satellites?
        Dr. Sega. Senator, I'll start it in terms of the
    capabilities, then I'll hand it off here to my left. We're
    trying to provide options, going forward, and in an uncertain
    world we think that's important. One of the characteristics
    that we do know about the 21st century is the rate of change of
    technology will increase. So, as we build satellites, we're not
    building them in isolation, nor are we with our airplanes, but
    rather we are looking at how they complement each other. How in
    this sensing realm, we can mutually cue one sensor on one
    satellite and then pass to other systems that may take action.
        I think there is a value in having robustness and options
    as we go forward. But, the specifics, with respect to how that
    would fit into an operational construct, I will pass it over to
    General Chilton.
        General Chilton. Senator Thune, thank you. I don't mind
    being corrected 100 percent on this, but I think that just like
    every one of our other missile defense systems, I think ABL
    will require the initial tipping and cueing that is provided by
    our space-based sensors, like the DSB Constellation and the
    SBIRS Constellation, which can see a launch of a missile
    anywhere on the planet, which is so cued to first get sensors
    looking in the right direction. So, warning, launch in this
    direction, this azimuth, turn and look, and I think that is
    where ABL can be brought to bear. But, I'll follow-up on that
    to make sure I'm 100 percent right on that, Senator.
        [The information referred to follows:]

        To follow-up on my answers concerning the Airborne Laser (ABL), I
    provide the following comments to correct the record. The ABL does not
    require any off-plane cueing; it is equipped with infrared sensors that
    will detect and track a boosting missile a full 360 degrees around the
    airplane. In fact, it can provide cueing to other platforms for
    missiles not within range or not engaged.

        General Chilton. The other thing about ABL, if we can prove
    that technology, it's a tremendous capability that could
    revolutionize the way we think about protecting air space,
    either from missile attack or other forces. So, it's an
    interesting technology that's being pursued there by the
    Missile Defense Agency (MDA).
        Senator Thune. One of the things that's a question that's
    always raised, and the Congressional Budget Office--as part of
    their recommendations of places that you can save money--was to
    do away with the program. But, it seems like, from the types of
    capabilities that it has in accordance with some of our other
    assets that it could really be a useful tool. If you have some
    information, my understanding was that it could operate
    independently of satellite.
        General Chilton. I'll follow-up on that, Senator.
        Senator Thune. Yes, I'd be curious to know if that's in
    fact true.
        General Chilton. Sure.
        [The information referred to is mentioned above.]
        Senator Thune. So, I guess it seems like, from the Air
    Force's standpoint, from a national security standpoint, it
    would make sense to continue to provide funding. It is, I think
    in the testing phase, obviously they've had a lot of success
    with it so far. Dr. Sega, could you comment on, with regard to
    whether or not that's something you believe we ought to
    continue to look for a way to fund?
        Dr. Sega. I believe that's in the MDA budget at this point.
    I don't know the trades they are making or if they had to fund
    one versus another. From the responsibility I have to help
    oversee some of the R&D activities in the Air Force--
    previously, I was Director of Defense Research and
    Engineering--we want to advance technologies, to advance
    options going forward, but I'm not sure exactly where they are
    in terms of their budgets and trades that they were making.
        Senator Thune. Anybody else?
        General Shelton. Just from a STRATCOM perspective, sir, ABL
    is very interesting technology and STRATCOM wants to see it
    succeed.
        Senator Thune. That has been my impression. I know these
    become hard decisions when you have to figure out one platform
    or weapons system versus another in a tight budget. I'm of a
    mind that we need to increase the overall budget for the
    military because I don't think we're going to be able to
    maintain superiority in some of these areas if we do fall
    behind. I would hate to see programs like this be sacrificed
    because of budgetary considerations.
        Just one other question, if I might. I think as a general
    proposition, we have to continue to look to exploit and expand
    the advantages that we have in technology when it comes to
    defeating our adversaries. But, one of the criticisms that's
    often mentioned since September 11, is that we rely too much on
    technology to gather intelligence and focus too little of our
    energy and resources on gathering human intelligence. I guess
    because we rely so heavily on our space capabilities, we've
    become incredibly vulnerable from an intelligence and military
    perspective, if those capabilities are destroyed. Obviously,
    the Chinese anti-satellite missile test underscores that
    vulnerability, and I guess I'd be interested in just your
    comments or response to that criticism. Dr. Sega, and anybody
    else on the panel who would like to chime in about their
    perspective on that, should we be focusing on ways to rely less
    upon our space capability?
        Dr. Sega. Senator, I'll approach it in terms of the
    robustness that we are moving toward developing, and then turn
    it over to others for the trade space and operations.
        One of our initiatives going forward is operational
    responsive space. There's an aspect of using current
    capabilities in a better way with the ground segments. There's
    also the development of smaller satellites launched on smaller
    boosters that can be done more quickly, not only to meet new
    needs, but potentially to reconstitute a capability after a
    satellite is no longer working for a variety of reasons, or to
    augment a constellation and improve the revisit time--you would
    have more constellations or more satellites in a particular
    orbit, therefore you would have less time between revisits.
        If I could return to this chart here just for a second. If
    a new idea comes out in this area of S&T, the question is how
    do you quickly get it to the system production phase, so that
    it comes on orbit for the warfighter.
        [The information referred to follows:]

        What we did last year--Congressman Reyes and Congressman
    Everett were there at the time--was to stand up a wing at
    Albuquerque called the Space Development and Test Wing, out of
    the Space and Missile Systems Center. That's the product
    center--they do systems development and systems production
    activities. It's right across the street from the Air Force
    Research Laboratory Space Vehicles Directorate--they do S&T and
    technology development. We're bringing together these entities
    so we can accelerate going from an idea to a fielded system; so
    we are doing things in a way that we can be more efficient,
    more responsive to these new needs; potentially also, testing
    these systems in space--and perhaps incorporating them in
    larger systems--so you actually check the technologies out in
    space.
        One example of that, is in December we launched our first
    tactical satellite experiment, TACSAT 2, on a Minotaur booster.
    We ordered the launcher 7 months prior to actually launching.
    The goal in that program is to have the satellite actually
    doing its job after just a couple times around the Earth, being
    a responsive payload.
        We invested in these kinds of capabilities. From 2001 to
    2005, we doubled the S&T investment in space-related activity
    and now we're starting to bring it on orbit. So, the ability to
    reconstitute, to at least have some capability--may be not as
    good as the original but not have zero--is one of the goals or
    one of the options that we're bringing forward. So, we're
    looking at the road ahead and seeing again what options we
    could have to bring forward to the warfighter.
        General Chilton. Senator, I would hesitate to comment on
    how the Director of National Intelligence balances portfolios
    for collecting the intelligence we need for our fights between
    human technical sides. However, I would, if I could, comment on
    intelligence related to space and that within the Air Force
    portfolio.
        I believe we were in a better position to analyze and
    examine the capabilities of potential adversaries before 1991
    than we are today, because we had a real threat in the Soviet
    Union, who was investing heavily in counter-space and space
    technologies that mattered if we ever were to come into the
    conflict with them that we so dreaded.
        When they collapsed in the early 1990s, we no longer had
    that need. What you saw is a decrease in the human capital
    side, those who paid attention to that. It was probably
    appropriate during that decade that we do that. But, now as we
    look to the future, it's no longer just us and another country
    in the domain. It's multiple countries in the domain that are
    increasing and accelerating in their capabilities. China is a
    classic example. We are focusing in the Air Force in the A-2
    Directorate under General Deptula, and in Space Command we're
    encouraging him along the way to increase that human capital
    investment and make sure we're looking to the future and
    developing the intelligence analysts and specialists we'll need
    at institutions like North American Air Sovereignty
    Intelligence Capability as we go into the future.
        So, thank you, sir.
        General Shelton. Senator, I just wanted to comment on the
    ASAT test directly and the response to that. There's a two-
    pronged approach you can take. To deal with the ASAT threat
    directly, and we're certainly looking at that, but then also to
    look at preserving the capability that is threatened by the
    ASAT. That runs the spectrum of capabilities that we have,
    airborne collection, both manned and unmanned, ground-based
    collection capability, ship-based collection capability. So,
    we're looking at all those things to ensure that we don't have
    all of our eggs in one basket, so that one cheap shot wouldn't
    hurt us.
        Admiral McArthur. Sir, to offer a different perspective on
    this, the Navy feels like the National Strategy for Maritime
    Security is a mandate for us developing and deploying
    capabilities and affects. A big part of that is maritime domain
    awareness. Maritime domain awareness, the architecture to
    support that important element is space sensors. Not only space
    sensors, but communications to be able to reach back to
    databases and analysts who develop that operational picture.
        There is a balance in terms of space and other systems, but
    without a doubt, space is essential to us for maritime domain
    awareness. Part of that will be provided by ORS and we're
    looking at the Automatic Identification System (AIS), which
    contributes to maritime domain awareness as part of the TACSAT
    Program that Dr. Sega briefed. So, important to us, essential,
    and again, a critical interdependency from Navy to the joint
    space community.
        Senator Thune. Thank you.
        Thank you, Mr. Chairman.
        Senator Bill Nelson. Senator Sessions?
        Senator Sessions. Thank you, Mr. Chairman.
        Dr. Sega, you mentioned operational responsive space in a
    7-month timeframe, what's your goal in terms of being able to
    launch a system to fill a need in years to come, in the near
    future, let's say?
        Dr. Sega. I'll approach the first part and then hand it
    over again. From a technical point of view, if you had a more
    common bus structure and parts that were available, then going
    from a need to the assembly of that system should take less
    time. If you could anticipate a satellite that you would want
    to have ready for orbit, you could actually be able to build it
    and store it and have it available.
        The launcher that we used for the TACSAT 2 experiment out
    at Wallop's Island was actually part ICBM Minuteman III-based.
    A Minuteman III's response time is very fast. If you already
    have the spacecraft on the booster, then it's a matter of
    minutes and one could launch--if that was your goal. So, we
    will bring the technical capability and the acquisition
    approach to respond faster, and look at smaller satellites
    being able to accomplish the job.
        Now, the actual experimentation that we're doing, not only
    includes the technical result, but also how it fits into the
    operations. So, we're exploring that as well. With that, I'd
    like to turn to the operational impact that could be presented
    by a TACSAT type of capability.
        General Shelton. Yes, sir. Senator, one of the things we're
    experimenting with here, is giving a combatant commander direct
    access to tasking rather than going through the National
    Intelligence Community for tasking assets, giving them direct
    access for tasking, and then they get direct reports back for
    the data as well. So, a very interesting experiment, much like
    we do with airborne intelligence surveillance reconnaissance
    today, we're just taking that concept up to space and seeing if
    it will be effective.
        Senator Sessions. But, you're getting serious consideration
    and working to develop a system by which we can replace a
    missing capability in short order with the least cost. Is that
    the overall concept of this program?
        General Chilton. Senator, that's what the combatant
    commander and I don't want to put words in your mouth, General
    Shelton, so correct me here, but as I said, they're looking at
    two fundamental areas. That's what we're exploring. The ability
    to augment if we need additional information or additional
    capability, even in peace time or in times of heightened
    tensions, or replace critical assets. That's in the TACSAT
    Program, right now, that we're executing. I think it's
    important because we're being able to answer the military
    utility question of these types of satellites.
        What I would like potential adversaries to understand if
    we're successful in this area, is that even if they go after
    capabilities that are on orbit today, we will be responsive
    enough, either through responsive launch capabilities or
    perhaps other capabilities that General Shelton referred to,
    air breathing or other, that they will still lose in a
    conflict. That in itself can be a deterrent to going after what
    we have on orbit today.
        If I could just comment on one other thing, because the
    operational responsive moniker often gets under some folks'
    skin and we, perhaps, could have thought of a better thing, and
    will. Because we've never put out a requirement, either myself
    or Dr. Kerr, that said, would you please build me a non-
    responsive space system. Every one of our space systems that
    are on orbit today are responsive and I salute the people, both
    in the NRO and in our organizations and Space Command, and
    General Shelton wearing his warfighter hat, are always looking
    for ways to milk every ounce more capability out of them.
        What we're talking about in this construct, is can we build
    capabilities in less than 10 years? Can we get a booster that
    we don't have to order 2 years in advance? Can we get a system
    on orbit that takes less than 6 months to check out, such that
    at the end of the day it meets the needs of the warfighter, the
    Joint Force Commander in the regions around the world? That's
    the way I contextualize this responsive desire of the combatant
    commander and that's what we're focused on developing right now
    in Air Force Space Command.
        Senator Sessions. I think it is a valuable capability and
    it made sense to me from the beginning, but I think it's a real
    need and needs to be as quick as we can make it.
        Dr. Sega, why did the Air Force reduce the planned funding
    for space by $400 million? What are the higher priorities that
    caused you to redirect that? How do we keep the Air Force from
    raiding, again, the space budget?
        Dr. Sega. The space budget this year--I'll present it in a
    couple of ways. In terms of the percentage of the modernization
    accounts from the Air Force, in 2007, as we submitted the
    budget request, space represented roughly 17 percent of the Air
    Force's modernization account. In 2008, space represents
    roughly 21 percent of the Air Force modernization accounts.
    Also in our budget, there is the move of funding from one part
    of the Air Force budget that's reflected in the numbers that
    have the space radar moved to the Defense Reconnaissance
    Support Activity account. So, there are two pieces, in terms of
    the monies.
        Now, in terms of the programs whose funding moved up and
    down. One of those, in addition to the radar line being
    removed, was the TSAT, and in that line the satellite launch
    date was moved approximately 1 year, to 2016. So there was a
    reduction there.
        Increases occurred to provide the missile warning piece and
    some of the early items that may be needed for SBIRS GEO-3, and
    SBIRS HEO-3 and -4. There's a lot of money in front-end loading
    of that acquisition and that's where the incremental funding
    would help. So, we put money in there as well, and also
    increased money into AEHF. There were other adjustments, but
    those were some of the major ones.
        General Chilton. Senator Sessions, if I could comment as
    well, sir, on the concept of the Air Force raiding the space
    budget. I'm the Air Force Space Command Commander and I fight
    in the corporate process alongside the other Major Commanders
    for how we invest in our various programs.
        Senator, I can tell you that I have not seen better support
    in the last few years that I've been in, both the programming
    world as the Air Force programmer or in the space business,
    than I've seen in this past year. The fact that our Air Force
    is challenged with recapitalization in its air-breathing fleet
    and our ancient aircraft that we're continuing to fly and need
    to replace. When I look at those challenges our Air Force has
    and then I look at our recapitalization needs in the space
    business, we are nowhere in the problem that we are in the air-
    breathing side because we have invested well. The Air Force has
    taken hold of their responsibilities to make sure there's
    uninterrupted--not only uninterrupted missile warning GPS,
    precision navigation and timings, communications, and weather--
    but, we're even investing on advancing the ball on those and
    improving the capabilities.
        Senator Sessions. While you suggest that, presumably we've
    thought differently.
        General Chilton. I'm sorry?
        Senator Sessions. Presumably we've thought differently
    about the aircraft issue and space and the critical need to
    keep our space capabilities the way we want them to be. So, I'm
    not sure that I would buy that, but it's a point I'm sure
    others agree with you on.
        But, we are going to see some move, it looks like, close to
    $9 billion by 2009. Is that the figure I have? For the
    transformational satellites, space-based infrareds, space
    tracking, space radar, polar operating, polar orbiting
    operational environmental satellite systems, will be increasing
    substantially in the years to come. We think that should be the
    policy of the Government. I think that's what we have put
    forth.
        Let me ask you this. Tell me about the acquisition
    workforce. I guess we're talking about an Air Force that's
    working hard like so many businesses are doing to be as lean as
    it possibly can be and we're talking about maybe a 40,000-
    person reduction in workforce. That can be a real billpayer for
    some of the things we like, if you can achieve that without
    damaging the Air Force and the responsibilities we have.
        Dr. Sega, General Chilton, let me ask you, how can we
    ensure that we retain the workforce needed to successfully
    deliver on these programs, including systems of engineers,
    program managers, and technical experts, as I think there's a
    growing consensus in Congress and, actually, in DOD that we
    need more in-house expertise as we seek to manage in a cost
    efficient way the development of new programs?
        General Chilton. Senator, if I could comment on that human
    capital that the GAO commented on too, and I don't disagree
    with the issue that we're concerned with. I think we got off
    the track and I think we've admitted this and we understand
    this, not just in the space business, but in all acquisition
    business in the late 1990s with our total systems performance
    approach to doing business. We stepped back, abrogated our
    responsibilities on the Government side, and what we created in
    doing that was a bathtub of expertise in middle management at
    the major and lieutenant colonel year group levels right now in
    our Air Force. A lot of those people looked uphill at the end
    of the 1990s and said, ``I don't see a future here with this
    management program,'' and they went to industry or left our Air
    Force.
        So, we recognize that as a challenge, and unfortunately we
    can't make those people overnight. You have to grow them.
    That's why we're so focused on, as we move to the future, how
    we, not only recruit, because I think there's talent out there
    that we're, I know there's talent, we'll compete with industry
    for coming out of the universities. But, then also, grow and
    mature people so that 5, 10 years from now, when I go looking
    for a GPS Program Manager to go work at SMC or someone to work
    the development of a next major program, I've raised them and
    given them that expertise they need to lead in that area.
        But, your concerns are valid and they're ones that we are
    focused on addressing and that is that core middle management
    that left our Air Force at the end of the last year.
        Senator Sessions. Have you formed an opinion about what
    percentage and how we should strengthen that capability of
    management of programs, with regard to uniformed personnel and
    civilian personnel?
        General Chilton. It's interesting to look at the balance in
    that area. We are looking at some military to civilian
    conversions out at SMC to boost the number of civil servants we
    have in the programs and try to recruit and bring in some of
    that mid-level talent in those areas, that will provide some
    stability and leadership in the interim. We're about 50/50 in
    our civil servants and military workforce out at SMC.
        If you go look at ASC, the aeronautical side or the
    electronic side, it's quite a substantial difference. There is
    a much higher civilian workforce out there. So, we're taking a
    look at that balance and how we can leverage the authorities
    we've been given to go convert some military to civilian
    positions and grow that, and recruit, I should say as opposed
    to grow, but recruit the civilian expertise to help us get
    through these times that we're in right now. But, we are taking
    the long view too here, Senator, in how we raise and develop
    people for the future.
        Dr. Sega. Yes, Senator Sessions, I absolutely agree with
    your points and your concern. I failed to mention in answering
    Senator Nelson's question he asked me with regard to Cristina
    Chaplain's comments on the acquisition plans going forward, how
    it has actually been implemented and institutionalized, it's in
    the right direction. I did send out a letter to the DOD with
    regard to back-to-basics and the block approach in space
    acquisition. In that letter, one of the sentences is: ``The
    foundation of this disciplined acquisition approach is an
    experienced, high-quality, technically educated Government
    workforce actively engaged in all aspects of the enterprise.''
    So, I believe it is the foundation going forward.
        One of the approaches here, as we mature technology, is
    also to take a similar approach for at least a fraction of our
    acquisition workforce, and have a workforce development plan.
    General Chilton has done that on an individual basis in their
    database of space professionals. We look at how they get their
    hands on experience in the early years of their career, say in
    S&T, and then build up knowledge in terms of their experience
    toward the complexity of systems that they will have in the
    future. In this way, they will have developed a technical
    instinct, as well as management skills, and financial acumen.
        Senator Sessions. How would you describe that in terms of a
    change in the way we've done business, how big of a change does
    that reflect? Anybody, we've heard this talk, we need to go
    back to more in-house management, the systems will come out
    better in the long run. You seem to agree with that. How
    significant of a change are we executing now on your part?
        Dr. Sega. Sir, in my view, the change, from what I
    understand, happened in the mid-1990s, in terms of having those
    responsibilities for the systems be placed outside of
    Government to contractors. What we're doing now is very
    different. The responsibility of these Government activities
    needs to be done by Government folks. They are supported by
    contractors and Federally Funded Research and Development
    Centers (FFRDCs) and so forth, but that expertise in Government
    is key. We have more in-plant presence, for example, in some of
    these programs that you heard of earlier today and that's
    making a difference. So, I think that discipline includes the
    workforce on the Government's side having those necessary jobs
    and experiences so they will be successful in our future.
        Senator Sessions. I just would say this. We've not been
    happy with our contracting procedures. Too many things have
    gone over in terms of cost and time and other things, GAO has
    pointed this out repeatedly. I do think your back-to-basics,
    and the other steps that you're taking seem to already be
    paying dividends. I really believe you're committed to this
    personally and I think that's why things are moving. Without
    your personal leadership, it probably would not. You have to
    clear the way for General Chilton sometimes too, so he can do
    the things they'd like to do.
        Ms. Chaplain, would you want to comment on any of those
    subjects?
        Ms. Chaplain. Yes, I have several comments. I appreciate
    the actions DOD and Air Force are taking on workforce, but we
    have concerns about the very near-term workforce that, I think,
    need to be addressed very soon. You can't wait for these long-
    term efforts.
        Just to give you a couple of examples, we visited the EELV
    office this year, and learned that 15 people will be retiring
    in the very near-term, so EELV's transitioning to a new kind of
    contract, it's trying to do a lot of things with those
    programs. Does it have the kind of people it needs to manage
    that effort?
        When we visited the TSAT office, we saw considerable
    turnover from the year before, and a lot of people within that
    program are just trying to come up to speed. In several of the
    space program offices and others weapons programs offices, we
    found that the service-type of contractors, they're helping
    manage the programs, and the FFRDC's personnel had more
    knowledge than the Government personnel, they were the ones
    with the institutional knowledge about the program.
        I visited a Navy program office earlier this year, where
    the program manager told me that he had one guy in the whole
    Navy who knew about a particular technology regarding sonar
    caps. He lost that guy to retirement, he hired him back as a
    contractor. I asked him, ``What are you going to do when he
    goes? Do you have a new sonar cap guy?'' He didn't. Finally,
    the Navy Lab had recognized that, and were going to grow
    somebody new, but that takes several years. As I understand in
    space, it takes several years to grow new personnel, so that's
    on one side where we see immediate needs to address workforce
    issues.
        We also have concerns about the growing reliance on
    contractors in programs to manage those programs. Issues like,
    who is really making decisions on the programs come to mind.
    How is oversight being executed? How is the Government dealing
    with potential conflicts of interest? So, we have a two-sided
    concern with workforce that is still on the table.
        Senator Sessions. Okay, thank you. Mr. Chairman, I'm glad
    you're back, and I did have a question about the $500 million
    funding reduction and how that will impact the TSAT and what
    delays we'll be looking. Maybe we can submit that for the
    record. I'm finished.
        [The information referred to follows:]

        The hearing transcript also indicates a question from Senator
    Sessions about a funding reduction and how that will impact the
    Transformational Satellite program. Dr. Sega stated that an immediate
    impact of the reduction would be a 1-year delay in the satellite launch
    date. We have not assessed the impact of the reduction in detail, but I
    would add that unanticipated funding reductions may also affect
    procurement of long-lead items and the ability to obtain and retain
    critical technical and business skills within the program. As
    emphasized in our testimony, the Air Force and Department of Defense
    could reduce the need for funding shifts in space programs by
    prioritizing its investment decisions and obtaining long-term funding
    commitments.

        Senator Bill Nelson. Okay, I have a few questions, and then
    what we'll do is recess and we will reconvene in a closed
    session in Russell 222. Jeff, are you going to meet us over
    there?
        Senator Sessions. Yes.
        Senator Bill Nelson. Okay.
        There's been much criticism of the late 1990s of the
    policies that let 40,000 people go. Does space, does it need to
    have an exemption from reduction? For instance, the Air Force
    reduction that had 40,000 people there?
        General Shelton. Senator, the reduction at the Air Force is
    on a glide path floor for about 40,000 of end strength from
    360,000 down to the vicinity of 320,000, is one that--those
    reductions were asked to be put in, and laid into the program
    across the FYDP, and Air Force Space Command took a real hard
    look at that last year when we were asked to put our share in,
    because this was divided up across the entire Air Force. We
    looked at it very carefully, and we believe there are
    reductions that we will take, are ones that we can continue to
    sustain our operations and development programs, and that they
    are reasonable reductions.
        I would also point out though, Senator, that our Chief and
    Secretary have said that given the proposed growth and end
    strength of the Army, and potential Marine Corps is being
    considered, I know, by Congress, that the Air Force is going to
    stop and take a look at future reductions beyond 2009 for the
    FYDP, and ask the question, if that growth occurs, does that
    require growth in the Air Force as well, as part of the Joint
    Team? So, I know the Chief and Secretary have testified that
    they intend to look at that this summer as they go forward, and
    perhaps re-address the reductions in 2009.
        Senator Bill Nelson. Why do you think the National Security
    Space Initiative funding is substantially reduced in fiscal
    year 2008?
        General Shelton. Senator, I think there were competitions
    for funds, always, and we're focusing on recapitalizing all of
    our key constellations. It's an area we could use additional
    help in, I don't mind saying, sir, in two-fold areas.
        One, is we're currently renting a facility in downtown
    Colorado Springs that doesn't have the capacity for this
    institution, and I would like to see us get on with the
    military construction of the facility on Peterson Air Force
    Base where I can alleviate force protection concerns, but also
    grow the facility to meet the demands. It's been so successful,
    that the United States Army certifies every one of their FA-
    40s, their Space Officers, comes through our Space 200 course
    that's taught at the Nonproliferation and National Security
    Institute.
        The additional funding we could use in this area would also
    improve not only the seats that we could accommodate, and put
    through the school, but also the quality of our Space 200 and
    300 courses, which I have asked the institute to raise the bar
    on, to make them a little more challenging, a little more
    encompassing.
        Senator Bill Nelson. Mr. Secretary, will the Air Force
    complete and have approval of the TSAT requirements by July of
    this year?
        Dr. Sega. Mr. Chairman, I believe that on the TSAT program
    we have a system review that's coming up in conjunction with an
    ICE that's also being done, and that process will go on and be
    completed by this calendar year. Our target is by the end of
    the summer, but I'll say that this work on TSAT will be done by
    the end of the calendar year.
        Senator Bill Nelson. So there is some delay, why is that
    delay?
        Dr. Sega. I don't anticipate a significant delay. The
    system is in review, and it is important for us to identify on
    a more detailed level the TSAT program status. The testing that
    was done on two of the very important technologies--the laser
    cross-link, and the next-generation process router--took place
    here in the last couple of months, and they have been
    successful. So, both contractor teams have passed on those
    critical technologies, where they needed to be to go forward.
    So, our goal is, by the end of this summer, to have that in
    place. The SDR, and moving toward a review of the cost in the
    ICE so we're in a better position to go forward.
        The first stop is technology maturity, requirements, SDR,
    and the cost estimation.
        Senator Bill Nelson. So, do you think those critical
    technologies will be done by October?
        Dr. Sega. Sir, what we had required going up to the SDR, by
    and large, are complete now.
        Senator Bill Nelson. What would be demonstrated by October?
        Dr. Sega. In terms of the design work, we went through a
    series of testing events that occurred at Lincoln Laboratory.
    On the S&T key technologies, the next-generation processor
    router and the laser communications, over the last couple of
    months. That was rigorous testing, and that was our principle
    look in terms of the technology going forward. Obviously,
    there's more work to do, but those hurdles were done in the
    Phase I and Phase II and are nearly complete.
        Senator Bill Nelson. What is the backup plan if the fourth
    AEHF is not reinstated?
        Dr. Sega. Our plan is to complete the work on AEHF I, II,
    and III, to do the risk-reduction--which we are doing on TSAT--
    the design, and go forward on the TSAT program with the back-
    to-basics block approach. We've reduced some of the
    requirements for the Block I than we had in the full program,
    so we've reduced some of that risk to increase our confidence
    that it will be delivered on time, and in our date which we are
    anticipating launch, on this schedule, with 80 percent
    confidence after CDR, is 2016. That should not have a gap in
    capability, and I would refer to General Chilton and General
    Shelton on that. We're going to need to have synchronization
    with other needs, as well as continuity of strategic
    communications. That should be maintained with a launch in
    2016. I believe the convergence--the synchronization rate--is
    approximately 2018.
        General Chilton. That's correct, Senator. As you mentioned,
    you see in this program the initial launch date of a TSAT
    system is moved to 2016 from 2015. We took a hard look at
    actual need dates, and the sweet spot, if you will, on the
    schedule that was based on user equipment purchases, Army
    requirements with regard to FCS, space radar requirements with
    regard to bandwidth, and then also the risk Dr. Sega talked
    about with regard to gapping critical communications
    capability, and the sweet spot is 2018. I'm comfortable with a
    2016 launch of the first TSAT, I'm not comfortable with the
    2017, because it classically takes several months for a first
    satellite to be tested and checked out, and I think we're right
    at my comfort limit right now for a launch date of 2016 for
    that system.
        Senator Bill Nelson. Admiral, how important is AEHF, and
    TSAT to the Navy?
        Admiral McArthur. Sir, TSAT is most important to the Navy,
    and the capacity that it will provide, essentially 10 times of
    what we see in the AEHF, the fact that it's protected
    communications, which we have others, but it's still
    protected--but most importantly it's the speed at which you can
    pass data with our ISR systems. Our expectation is 2016, we'll
    follow through on. We're synchronizing our other programs, the
    ground segment, the user segment, the ISR systems that, advance
    systems that we expect to come on board--we're synchronizing
    them with that date and are satisfied with 2016, sir.
        Senator Bill Nelson. Ms. Chaplain, what's your assessment
    of the progress of TSAT?
        Ms. Chaplain. We believe the practices that TSAT is
    adopting do give you more schedule certainty. But there are
    still risks in the program, especially down the road when it
    comes to software that needs to be developed, and integration.
    So, obviously, the lower-risk investment is to continue with
    the AHF buy, if you had to make a choice. Ideally, you'd be
    funding both, and just to keep things on an even keel, and I
    don't like abdicating cutting a program that's doing well, and
    trying to adopt best practices, but if you looked at it just
    from a risk perspective, continuing the AHF would be the lower-
    risk approach.
        Senator Bill Nelson. Mr. Secretary and General Chilton, the
    news recently indicates there is a debate going on between the
    Intelligence Community and the military community with regard
    to the NRL sensor on the TACSAT 2, and that the sensor is not
    turned on, and the issues is still not solved. How does this
    issue get resolved, so that the sensor can get tested?
        General Chilton. Senator, I think the issue is a discussion
    on title 10 and title 50 authorities and responsibilities. I
    look at the question the same way I would look at a U2 air-
    breathing intelligence collecting platform, the U2 Dragon Lady
    that the Air Force operates.
        It does optical and radar reconnaissance that supports both
    the title 50 community, as well as the Joint Forces Commander
    in the theater that that airplane is operating in. It does the
    same with regard to signals collection, which can support both
    the title 50 community, as well as the Title 10 joint
    warfighter. I don't see an issue that we can't work through
    about developing space capability along the lines of these
    TACSATs, or ORS, eventually, when we start talking about an
    augmentation or a replacement capability that cannot be treated
    in a similar fashion as we treat our U2s, as we treat our RC-
    135s which do both title 50 and title 10 work.
        Senator Bill Nelson. Is this silly turf-fighting?
        General Chilton. Sir, I wouldn't call it that, I would say
    there are folks used to authorities and how they operated in
    the past, and this is really new ground in the space domain. It
    is something we have worked through in the air domain many
    years ago, so maybe some folks were surprised by the payloads
    on TACSAT, we certainly didn't hide those, but this debate is
    coming up, I think it's one that can be easily resolved.
        Senator Bill Nelson. Are we about to miss testing a sensor
    as a result of this in-fighting?
        General Chilton. Senator, I was not aware about the not
    being turned on portion that you briefed, I knew there was an
    issue. So, I might have to defer to General Shelton on that. I
    know the imagery sensor, which takes photographs, is turned on
    and is going through test and checkout, so I will defer this to
    General Shelton.
        Senator Bill Nelson. Is there a problem, General Shelton?
        General Shelton. Yes, sir, there is. AIS is the sensor that
    Admiral McArthur referred to earlier, and that has been
    problematic, and we'll continue to work this, and as General
    Chilton said, I'm confident we can work through it.
        Senator Bill Nelson. Is there this turf battle between the
    Intelligence Community and military community?
        General Shelton. Again, I wouldn't characterize it as a
    turf battle, I would characterize it as a new, first out-of-
    the-box kind of capability where what has been the sole purview
    of the National Intelligence Community from space is now going
    into the DOD in a space-based capability. So, working through
    the authorities, working through the law that exists, it's just
    going to take some time. So, there are plenty of lawyers
    involved helping us with this one.
        Admiral McArthur. Sir, I would like to say, though, that
    the Navy is anxious to experiment with a new doctrine and new
    tactics and techniques and procedures. We made references
    earlier to combatant commander tasking of sensors, and that's
    reflected in the initial concept of operations of U.S. STRATCOM
    for ORS.
        We're working within the Joint Space community, with the
    Intelligence Community to resolve these doctrine of the past,
    to transform to a new way of doing business. We have forces
    that are deployed today, standing by to task that AIS sensor
    when we clear a couple of hurdles. Thank you, sir.
        Senator Bill Nelson. Does this need to be drawn to the
    attention of the head of the Central Intelligence Agency and
    General Hayden?
        Admiral McArthur. No, sir, the resolution of previous
    doctrine and policy is underway today. We have leadership
    within the Intelligence Community and the DOD that are working
    to change and transform. So, we're again, looking forward to
    experimenting with a new doctrine.
        Senator Bill Nelson. So, if you all resolve this, this is
    going to take care of future TACSATs?
        General Shelton. Senator, that would be our design, is that
    we get this resolved, and we move forward.
        Senator Bill Nelson. If you need a little help, let me
    know.
        Senator Sessions. Senator Nelson also runs the Intelligence
    Committee, too.
        Admiral McArthur. This discussion should be helpful enough.
    Thank you, sir.
        Senator Bill Nelson. Let's talk about iGPS. Tell us, are
    you all familiar with that concept?
        Dr. Sega. iGPS is one of several proposed options for
    augmentation of GPS. Augmentation takes many forms around the
    planet in terms of getting additional accuracy--it's done in
    agriculture--it's done in a variety of other ways. We do it in
    different ways on the defense side, and iGPS would be one
    technique toward an augmentation. So it's important to keep our
    eyes open and look at different options for augmentation, but
    it's one of a variety of augmentation approaches.
        Senator Bill Nelson. Are the GPS terminals, are they going
    to be compatible with the iGPS?
        General Chilton. Sir, I don't know the answer to that
    question, I have received a briefing on the iGPS concept, and
    which is, I think, Dr. Sega described accurately, but I'd like
    to take that for the record, Senator, and bring you an answer
    back on that.
        [The information referred to follows:]

        I do recall from an iGPS briefing that iGPS leverages the Iridium
    Constellation and the Department of Defense supported the President's
    budget to develop iGPS capabilities. If you accept this path, then you
    look at a need to reconstitute the Iridium Constellation, which is not
    in the current program.
        Specifically, to answer your previous question, I submit the
    following information:
        To review, the iGPS industry concept proposes a regional
    augmentation of GPS that includes the communications capability of
    Iridium. iGPS envisions use of low-flying Iridium satellites (in 500NM
    orbits), new reference stations situated in the AOR, as well as iGPS
    user equipment to deliver improved accuracy, availability, anti-jam
    resistance, and two-way communications.
        Current GPS military user equipment is not compatible with the iGPS
    concept. New user equipment would have to be designed and fielded, a
    requirements definition and developmental engineering process taking
    several years before this capability would be available for the
    military.
        To employ this concept would require building new iGPS reference
    stations, most likely overseas, where there is force protection and
    basing issues. The number of reference stations required would depend
    on the iGPS coverage needed.
        The Air Force has not studied the overall iGPS costs; however, the
    cost of reconstituting the Iridium Constellation is likely to be on the
    order of $5 billion. User equipment costs would depend on the number
    and variety of users requesting iGPS service. There are also unknown
    costs related to modification of the control segment, development,
    basing and force protection of the additional iGPS reference stations,
    and an annual service fee.
        The time required to operationalize iGPS and its useful life would
    be contingent on its final scope and concept of operations. The sense
    of the GPS community is that the GPS IIIB era will be on hand (fiscal
    year 2016) by the time iGPS would be a fully operational military
    system. While we have examined iGPS only as a military augmentation
    system, properly equipped civil and commercial users could benefit if
    they were in a coverage area.
        Though iGPS is a great example of ingenuity, it would only provide
    military users some additional limited capabilities for a few years.
    iGPS presents unquantifiable costs with respect to Iridium's LEO orbit
    with increased vulnerability to counter-space action and increased
    overseas footprint. Lastly iGPS does not remove the necessity for GPS
    III, which independent of iGPS, shall meet the full set of military and
    civil user requirements.

        Senator Bill Nelson. I understand there is a problem, and
    also additional ground antennas or relays would also be needed
    to make it functional, and of course we'd like to know the cost
    of the concept, who would use it, when it would be operational,
    and how long it would be usable?
        General Chilton. Senator, I'd be happy to provide the
    answers for the record for that. One thing I do recall from the
    briefing on iGPS is that it leverages the Iridium
    Constellation, and if you go down that path, then you look at a
    need to reconstitute that constellation, which of course, is
    not in the current program.
        Senator Bill Nelson. Ms. Chaplain, there are rumors going
    around that the terminal programs are lagging behind the
    satellite programs, and that there is also a shortage of
    terminals. If that's the case, how does it get fixed?
        Ms. Chaplain. We've just started looking at this issue
    ourselves, and we do have questions about the synchronization
    of the acquisitions, at least in the GPS area, and I know
    there's a few more programs that we have questions about. How
    you fix it requires a lot more coordination between the two
    efforts, and balanced funding to make sure that they march down
    the same path. If the terminals lag too far behind, you're
    missing opportunities to extract new capabilities, and in
    essence, wasting investments in these new satellites if you
    can't use them with the ground equipment. So, it's something
    we're going to be looking at more this year.
        Senator Bill Nelson. For example, you can't even utilize
    the M Code on the GPS satellite, because there are no fielded
    terminals.
        Ms. Chaplain. Yes.
        Senator Bill Nelson. What do you think about that, General
    Chilton?
        General Chilton. Sir, we're just starting to field the M
    Code on the II-RM satellites right now, we just have three of
    those up, I believe----
        Dr. Sega. That's correct.
        General Chilton.--five more to follow. So, you're exactly
    right, Christina, there is a balance that we have to manage
    between fielding terminals and satellite capability because you
    don't want to waste capability on orbit.
        I'd say, also, the other thing we need to keep our eye on,
    Senator, is not only the terminals that the user uses, which
    are classically fielded and paid for by the individual Services
    that are buying those, in the GPS case, but in our Command and
    Control element for GPS. This is an area, the AEP program, and
    the OCX programs that we're very focused on in Space Command to
    make sure we get that transition to new Command and Control
    architecture on GPS safely done this summer, and then manage
    into the future, so that when you have the satellites on orbit,
    you can even turn on the new capabilities, and make sure we can
    command and control it. So, it's a multiple-pronged issue that
    is exactly on mark that we stay synchronized, not only building
    the satellite element, but the ground element that goes with
    it, and the user equipment.
        Senator Bill Nelson. Thank you. We will recess the
    subcommittee, and we will reconvene in Russell 222 for a closed
    session. We are adjourned.
        [Questions for the record with answers supplied follow:]

                   Questions Submitted by Senator Bill Nelson

                           CHINA ANTI-SATELLITE TEST

        1. Senator Bill Nelson. Dr. Sega, General Chilton, and General
    Shelton, in January, the Chinese conducted a successful test of a
    kinetic anti-satellite (ASAT) weapon. What are the implications for our
    space programs and what capabilities do we need to improve?
        Dr. Sega. Given the critical importance of our space assets, we
    must improve our ability to detect space objects and characterize them
    as quickly as possible. To help accomplish this, the Air Force is
    currently pursuing upgrades and new capabilities to improve Space
    Situational Awareness (SSA), such as the Space Fence and Space-Based
    Space Surveillance (SBSS). Additionally, the Department of Defense
    (DOD) is expanding its ongoing emphasis on new technology and tactics,
    and working to develop a surge, augmentation, and reconstution
    capability through the Operationally Responsive Space (ORS) program.
        General Chilton. Today, our surveillance, analysis, and data-
    sharing capabilities do not adequately support our emerging needs to
    rapidly identify and understand the threats to our space systems. We
    must improve our ability to detect the threat and characterize it as
    soon as possible--preferably before launch--to give ourselves maximum
    time to avoid or at least mitigate the risk using all available
    instruments of national power. We also must improve our capability to
    detect and evaluate the risk from all debris, man-made and natural. Our
    analysts did an incredible job quickly characterizing the debris cloud,
    but they are constrained by an antiquated computer system, a Cold War-
    era communications structure, and a patchwork of surveillance systems
    that were not designed from the ground up to provide the type of SSA we
    now require.
        To that end, we have programs in place which will improve existing
    capabilities. Space Based Infrared System and Space Tracking and
    Surveillance System will help us characterize launches and identify
    potential threats more quickly. Integrated Space Situational Awareness
    (ISSA) will provide increased accuracy and improved processing over the
    1980s-era Space Defense Operations Center computer system. The Rapid
    Attack Identification and Detection Reporting System (RAIDRS) will
    enable us to not only detect and assess threats but will suggest
    potential courses of action to the Joint Functional Component Commander
    for Space (JFCC SPACE). The Space Command and Control (C2) program will
    enable JFCC SPACE to respond to threats and execute protective
    operations while there is still time to defend our systems. The Space
    Fence, Space Surveillance Telescope, and other Space Surveillance
    Network (SSN) recapitalization programs will enable us to characterize
    a debris cloud or other potential threats and assess risk to other on-
    orbit systems in a fraction of the time it takes today.
        Lastly, the ability to posture our space capabilities and effects
    during and after an event is paramount to maintaining space
    superiority. We are focused on delivering, deploying, and employing
    operationally responsive technologies, systems, and associated tactics
    to augment, recover, and replenish space capabilities for combatant
    commanders and national defense.
        General Shelton. Implications of the successful Chinese ASAT test
    include increased risks to manned and unmanned space assets for all
    space-faring nations. We need to improve the persistent and predictive
    nature of SSA capabilities (sensing and analyzing), and combine this
    with command and control capabilities in a timely and relevant fashion
    to enhance a decisionmaker's ability to determine and execute
    appropriate courses of action. Deploying and employing responsive space
    elements to exploit new technologies and operational capabilities, as
    well as augment or reconstitute existing capabilities, strengthens the
    perseverance of space effects and provides the flexibility to respond,
    when and where needed.

        2. Senator Bill Nelson. Dr. Sega, General Chilton, and General
    Shelton, the Air Force unfunded priorities list includes funding for
    SSA activities. Could you address the need for additional SSA
    capability and why is it important?
        Dr. Sega. SSA is an increasingly important component of space
    operations. It includes the ability to surveil the space domain with
    the goal of identifying and classifying objects in space, in as near
    real time as possible. The fiscal year 2008 President's budget includes
    funding for the first SBSS satellite which is scheduled to launch in
    fiscal year 2009, and should improve our ability to rapidly find, fix,
    and track orbiting objects. In the future, satellite ``self awareness''
    capabilities will also become increasingly important.
        General Chilton. Preserving our advantage in space is a
    prerequisite for everything we do. SSA is the foundation for all space
    operations but in particular for space defense. We can't protect our
    critical space systems and can't respond to emerging threats without
    knowing what might threaten them. SSA allows us the ability to
    effectively surveil the space domain with the goal of answering, in as
    near- to real-time as possible, the questions of ``who, what, when,
    where, how, and why?'' The answers to these questions are vital to the
    commander responsible for operations in any domain.
        Today, we are reaching the limits of what our computer system was
    designed to handle so we need to invest in new system like ISSA. ISSA
    will handle the growth anticipated in on-orbit population as well as
    provide the increased accuracy demanded by today's users. Our SSN is a
    combination of Cold War-era systems and most of the systems are decades
    old and our surveillance network is in drastic need of modernization or
    replacement. We have a critical space surveillance sensor gap in the
    southern hemisphere. We must continue to sustain our current systems
    while we invest in the Space Fence program and the SBSS. The Space
    Fence program will give us a quantum leap in being able to detect and
    track small objects like micro-satellites, combined with deploying
    sites overseas. The SBSS will give us unprecedented abilities to ensure
    we can maintain custody of objects in orbit. These two programs will
    fill key shortfalls in our abilities today.
        Even as we try to find a way to recapitalize the SSN, we must take
    better advantage of the information and systems that we have. We need
    to be able to monitor, collect, fuse, and exploit information from the
    SSN, missile defense sensors, and many other sources to provide near-
    real time global awareness to our commanders so that they can make
    well-informed, timely decisions. We must continue to sustain our
    existing systems to avoid gaps while delivering new transformational
    capabilities.
        General Shelton. Current SSA methods are focused on reactive
    measures designed to identify, track, analyze, and assess objects
    within the space environment. The need for additional proactive SSA
    capabilities enabled by advanced net-centric architectures that
    integrate data sources and are predictive are necessary to defend our
    freedom of action in space. The escalating number of objects in, and
    threats to, our space capabilities, places our national and manned
    space assets at increased risk. SSA modernization will provide the
    foundation required to anticipate and respond to the pending
    accidental, environmental, or intentional threats posed to our space
    systems.

                                  SPACE DEBRIS

        3. Senator Bill Nelson. Dr. Sega, General Chilton, and General
    Shelton, the Air Force maintains a catalogue of space debris--the
    Chinese test created thousands of new pieces of space debris. How does
    that debris affect U.S. military and commercial space programs?
        Dr. Sega. Some of the debris generated from the Chinese ASAT test
    will remain in orbit for decades and is in the same orbital regime as
    many United States space assets. Because of this, there is a potential
    that tracked and/or untracked debris pieces too small to track could
    collide with an on-orbit satellite. The Joint Functional Component
    Command for Space (JFCC SPACE) at Vandenberg Air Force Base,
    California, monitors trackable space debris closely and continues to
    accomplish conjunction assessments on a daily basis. In this way, they
    can determine close approaches between the trackable debris and U.S.
    space assets and recommend these assets be maneuvered, if necessary.
        General Chilton. The debris generated from the Chinese ASAT test
    will present a risk of collision for decades to come. The pieces of
    debris created by the Chinese are in the same orbit regime as many U.S.
    space assets and as such there is a threat that tracked and/or
    untracked debris pieces could collide with an on-orbit satellite. JFCC
    SPACE monitors the situation closely and continues to accomplish
    conjunction assessments on a daily basis to determine close approaches
    from the debris with U.S. assets.
        General Shelton. Increased space debris creates a tremendous burden
    on the space professionals tasked with analyzing and predicting
    conjunction opportunities. Insufficient automation and processing
    requires an analyst to individually review the data closely once an
    object has been identified as a possible threat to a space asset
    regardless of whether it is a commercial or military platform. Post
    event modeling indicates that the probability of a low earth orbit
    satellite being hit by debris increased 10-40 percent over a 5-year
    period. Given the extensive de-orbit timeline for this newly created
    space debris, its impact on military and commercial systems will be
    felt for years to come.

        4. Senator Bill Nelson. Dr. Sega, General Chilton, and General
    Shelton, DOD relies heavily on commercial satellite capabilities as
    does the U.S. economy, will the Air Force continue to provide
    notification of debris location to the commercial space industry? There
    is some ongoing confusion about whether funding is available in fiscal
    year 2008 to do this.
        Dr. Sega. Air Force Space Command (AFSPC) provides space
    surveillance data to non-U.S. Government entities through its pilot
    program ``Support to Commercial, Foreign Entities (CFE),'' as
    authorized in the National Defense Authorization Bill for Fiscal Year
    2004.
        Satellite position data, as well as debris data, is made available
    through the CFE Web site to any registered user. CFE is not funded as a
    separate line item by Congress, but AFSPC has, to date, funded the 3-
    year pilot program which is scheduled to expire at the end of fiscal
    year 2009. Additionally, the Joint Space Operations Center provides
    notification to U.S. commercial satellite operators when potential
    collisions with the debris are predicted.
        The Air Force currently intends to fund the program in fiscal year
    2008 and keep the Web site operational. AFSPC could evolve the existing
    CFE pilot program from a basic Web site to an improved operational
    capability that provides advanced services (conjunction assessment,
    launch screening, anomaly resolution, et cetera) to a wide variety of
    customers, to include commercial, allied, public, and foreign
    interests. However, resources are currently not available within the
    budget for full implementation of the program.
        General Chilton. The National Defense Authorization Bill for Fiscal
    Year 2004 (signed 24 Nov 03) allows the Secretary of Defense to carry
    out a pilot program to determine feasibility and desirability of
    providing non-United States Government entities space surveillance
    tracking services, data, and analysis. This pilot program is called
    Commercial and Foreign Entities (CFE) and has been re-delegated from
    SECAF to AFSPC. The primary goal of the pilot program is to enhance DOD
    SSA and to meet DOD objectives by providing timely, accurate, and
    state-of-the-art surveillance services to commercial and foreign
    entities, as resources permit; and to normalize the processes used to
    provide this support. Satellite position data, as well as debris data,
    are made available through the CFE Web site to any registered user.
    This pilot program is unfunded; however, AFSPC will continue to seek
    funds to keep the Web site operational for fiscal year 2008.
        General Shelton. AFSPC provides space surveillance data to non-U.S.
    Government entities through its pilot program ``Support to CFE.'' No
    specific ``debris notification'' is proactively issued to commercial
    space industry, but ephemeris data is made available through the CFE
    Web site to any registered user. CFE is not funded as a separate line
    item by Congress. AFSPC has voluntarily funded the 3-year pilot program
    scheduled to expire at the end of fiscal year 2007. Fiscal year 2008
    funding is undetermined at this time. USSTRATCOM would like to see the
    Air Force continue this program and mature its capabilities, while
    preserving operational security of ongoing space operations.

        5. Senator Bill Nelson. Dr. Sega, General Chilton, General Shelton,
    and Admiral McArthur, continuing with how to respond to the debris
    issue, do you believe it is time to look at additional international
    solutions to controlling and mitigating debris?
        Dr. Sega. The existing legal regime, including treaties, adequately
    addresses the issue of orbital debris. The United States is taking a
    leadership role in international fora to encourage foreign nations and
    international organizations to adopt policies and practices aimed at
    debris minimization. The United States also seeks to minimize the
    creation of orbital debris by its own government and non-government
    operations in space, as is outlined in the President's National Space
    Policy.
        General Chilton. The existing legal regime, including treaties,
    adequately addresses the issue of orbital debris and new legal
    solutions are not necessary. The United States is taking a leadership
    role in international fora to encourage foreign nations and
    international organizations to adopt policies and practices aimed at
    debris minimization. Of course, the United States also seeks to
    minimize the creation of orbital debris by its own government and non-
    government operations in space, as is mentioned in the President's
    National Space Policy.
        General Shelton. Yes. Controlling, minimizing, and mitigating space
    debris is beneficial to all space fairing nations and global users of
    space products. National Space Policy directs that ``The United States
    shall take a leadership role in international fora to encourage foreign
    nations and international organizations to adopt policies and practices
    aimed at debris minimization and shall cooperate in the exchange of
    information on debris research and the identification of improved
    debris mitigation practices.'' Consistent with this policy, the United
    States should pursue international solutions incorporating allied or
    U.N. involvement through diplomatic and/or technical solutions.
        Admiral McArthur. Yes. Controlling, minimizing, and mitigating
    space debris are beneficial to all space-faring nations and global
    users of space products. National Space Policy directs that ``The
    United States shall take a leadership role in international fora to
    encourage foreign nations and international organizations to adopt
    policies and practices aimed at debris minimization and shall cooperate
    in the exchange of information on debris research and the
    identification of improved debris mitigation practices.'' Consistent
    with this policy, the United States should pursue international
    solutions incorporating allied or U.N. partnerships to influence the
    global space community in this area through diplomatic and/or technical
    and scientific channels.

                         OPERATIONALLY RESPONSIVE SPACE

        6. Senator Bill Nelson. Dr. Sega, General Chilton, and General
    Shelton, I am glad to see that the Air Force has included funding for
    ORS. The three main elements of ORS are launch, satellite buses, and
    sensors. How should we think about dividing time, attention, and
    funding among these three pieces of ORS? Is the fiscal year 2008 budget
    request balanced appropriately?
        Dr. Sega. Yes, the fiscal year 2008 ORS budget request is an
    appropriately balanced request. The request includes funding for the
    launch of tactical satellite (TACSAT) experiments demonstrating new
    sensor capabilities; the beginning of the development of an operational
    series of spacecraft; and the purchase of launch vehicles, while
    providing funds to examine the ground infrastructure necessary to fully
    use the spacecraft. This budget request is intended to be complemented
    by research, development, test, and evaluation (RDT&E) resources from
    organizations such as the Air Force Research Lab (AFRL), the Naval
    Research Lab (NRL), and the Army's Space and Missile Defense Command
    (SMDC). Flexible funding arrangements are also critical to dynamically
    balance resources to meet urgent needs.
        General Chilton. The ORS budget is an appropriately balanced
    request and is detailed as follows:

                            [In millions of dollars]
    Operational TACSAT Block 1.................................      $21.600
    Operational launch vehicle multi-vehicle buy...............       34.000
    Operational capability development and integration.........        3.500
    Ground processing, dissemination, and command and control..        3.600
    TACSAT-4 launch vehicle and operations.....................       18.215
    Perform analysis and assess alternative concepts/                  4.300
     requirements and program support..........................
    TACSAT-3 and -4 Launch.....................................        1.817

        The request includes funding for the launch of TACSAT experiments
    demonstrating new sensor capabilities, the beginning of the development
    of an operational series of spacecraft, purchase of launch vehicles,
    and provides funds for examining the ground infrastructure necessary to
    fully use the spacecraft. This budget request is supported by the RDT&E
    requests from the AFRL, NRL, and the Army's Space and Missile
    Development Center which funds the development of new sensors. Flexible
    funding arrangements are critical to dynamically balance resources to
    meet urgent needs.
        General Shelton. ORS is a broader concept than improving the
    responsiveness of spacelift (to include ranges), satellites, and
    sensors. ORS will enable improved integration through rapid deployment/
    employment of new, pre-planned, or existing capabilities. It will link
    operational, acquisition, industry partners, and science and technology
    communities to rapidly exploit emergent capabilities to fill
    operational gaps. ORS will generate warfighting effects for operational
    and tactical use in response to urgent or unanticipated needs. The
    focus is on responsiveness. Tasked by a Joint Force Commander (JFC), it
    will be timely and targeted to the need, while enhancing survivability
    and adversary deterrence.
        The budget is balanced appropriately. There is sufficient funding
    to standup the ORS office, investigate what the office should initially
    focus on, and buy some long lead item components to make ORS a reality
    for the warfighter. Funding concerns exist relative to resources in the
    out years and support from Congress going forward will be critical to
    continued success.

        7. Senator Bill Nelson. Admiral McArthur, what is the Navy vision
    for ORS and what is the Navy's role in ORS?
        Admiral McArthur. The Navy vision for ORS is to provide a more
    affordable way to get beyond the line of sight of communication
    capabilities, rapid-reaction ISR sensors, and other tactically and
    operationally significant payloads, on orbit, in a tactically relevant
    timeframe to respond to asymmetric challenges and hedge against
    uncertainty. Navy supports ORS because maritime forces need the
    flexibility that ORS offers to augment and reconstitute critical
    warfighting capabilities in order to counter increasingly agile
    adversaries.
        Navy's role in ORS is to be a partner in a truly joint effort to
    build on the TACSAT series of experiments and deliver an operational
    capability to the JFC. We realize that ORS is more than just smaller,
    rapidly developed satellites and requires an end-to-end examination to
    develop the agility and capabilities needed to rapidly adapt to the
    ever evolving threat environment facing our JFCs.

        8. Senator Bill Nelson. Admiral McArthur, how should the joint ORS
    office be structured, funded, and staffed?
        Admiral McArthur. Navy actively participated in the congressionally
    directed 120-day ORS study and supports its findings. This study report
    titled ``Plan for Operationally Responsive Space'' was provided to
    Congress at the end of April and lays out the structure, funding, and
    staffing plan for the joint ORS office. To obtain the depth and breadth
    of expertise in both space systems and joint warfighting, with
    reachback to the entire National Security Space (NSS) community, the
    office should be staffed with trained personnel from all Services,
    agencies, and the Intelligence Community. We need to build on the
    TACSAT series of experiments to reflect the partnerships that need to
    be developed among the Services, COCOMs, and Intelligence Community to
    provide innovative solutions and leverage the best talent available
    across the NSS community to solve warfighting challenges. The ORS
    office should be a truly joint office with the military departments and
    agencies nominating candidates for the director and top leadership
    positions to the ORS Executive Committee and DOD Executive Agent (EA)
    for Space for review and selection.
        As described in the ``Plan for Operationally Responsive Space,''
    responsibility for funding joint ORS capabilities belongs to the DOD EA
    for Space through the Program Elements listed in the report. As part of
    the joint TACSAT and ORS effort, Navy, through the Office of Naval
    Research (ONR), is investing $15 million of S&T funds each year in
    moderate-to-high-risk projects that result in significant prototypes
    through the Space Innovative Naval Prototype program. Investments are
    focused on naval capability gaps that space can fill such as ship
    tracking, data exfiltration from buoys, communications-on-the-move,
    submarine detection, cueing, and littoral characterization. NRL led
    development of a ship tracking payload for TACSAT-1 and a secondary
    payload on TACSAT-2. ONR is providing a secondary payload for TACSAT-3
    that provides a basic IP-based data exfiltration capability. NRL is
    leading TACSAT-4 for the joint community with ONR funding the UHF
    Communications payload to support comms-on-the-move and data
    exfiltration. TACSAT-4 uses a prototype spacecraft bus resulting from a
    broad government-industry team effort to develop and mature bus
    standards for increased modularity. The spacecraft should be completed
    by the first half of next year and will be launched into a highly
    elliptical orbit to provide long dwells over theater. NRL is managing
    the ORS Payload Technology initiative for OSD. This initiative jointly
    evaluated 75 industry proposals and awarded 14 which are being
    developed by industry now and over the course of the next year.

        9. Senator Bill Nelson. Ms. Chaplain, from the Government
    Accountability Office (GAO) perspective, what are the most important
    elements in keeping ORS responsive and inexpensive?
        Mr. Chaplain. ORS represents a collection of efforts designed to
    deliver space-based capabilities to warfighters more efficiently and
    effectively. They encompass development of small-size tactical
    satellites, cheaper and smaller launch systems, standardized satellite
    components, as well as efforts that are exploring new design techniques
    and ways to better protect space-based equipment. There are a variety
    of ways ORS can help to improve the way satellites are acquired in
    DOD--for example, by providing opportunities and resources to test out
    future sensors and software; reducing pressure to satisfy al! war
    fighting requirements in a single, large program; and developing common
    approaches to design and production.
        At your request, we are initialing a review that will focus on
    progress DOD is making in implementing these initiatives as well as a
    strategy on managing and coordinating these efforts. Our past work,
    however, has already identified elements that need to be in place to
    make ORS a success. Figure below highlights these.

        Within the science and technology (S&T) community, for example,
    there needs to be effective prioritizing of investments between ORS
    projects and non-ORS projects, so that DOD can ensure that critical
    technology development efforts, such as the development of advanced
    batteries, are adequately funded. There also needs to be effective
    coordination among S&T organizations, industry, and the acquisition
    community, so that lessons learned from ORS can be effectively
    integrated into the larger acquisition programs and ultimately
    engrained in the organizational culture. Our past work has generally
    found that efforts are not adequately coordinated nor are S&T
    investments strategically balanced and prioritized.
        Likewise, within the acquisition community, there needs to be a
    sustained commitment to using best practices and a willingness to
    examine alternatives in technologies, design and development
    techniques, and different ways to satisfy requirements. Our testimony
    noted that while current leadership has embraced adopting best
    practices, there was no guarantee that this commitment could be
    sustained until DOD changed its policies and processes surrounding
    space acquisitions.
        Finally, our best practice work has identified elements that need
    to be in place to ensure a smooth transition between projects that have
    been a success in the S&T community to the acquisition community. They
    include transition plans and agreements; managers to guide the
    transition process; measures focused on feasibility, relevance, and
    readiness; and a gated review processes to ensure that the right
    progress is being made and enlist product line commitment. Leading
    commercial companies use these techniques for successfully developing
    and transitioning technologies, with the basic premise being that
    technologies must be mature before transitioning to the product line
    side. At present, however, DOD lacks the breadth and depth of these
    techniques, and it routinely accepts high levels of technology risk at
    the start of major weapon acquisition programs. These shortcomings
    contribute significantly to DOD's poor cost and schedule outcomes.
        Our ORS review will assess whether these elements are in place and
    it will seek additional input from the S&T community and others on what
    additional tools can enable success. We look forward to reporting on
    the results of our review early next year.

                         NATIONAL SECURITY SPACE OFFICE

        10. Senator Bill Nelson. General Shelton and Dr. Sega, following
    the decision to have the director of the National Reconnaissance Office
    (NRO) be separate from the Under Secretary of the Air Force, the
    Director of the NRO pulled out support, both money and people, from the
    National Space Security Office (NSSO). The NSSO was created to be a
    independent think-tank essential to address, work, and resolve
    crosscutting issues within all of the space community. In your views,
    should the NRO continue to support NSSO?
        General Shelton. The NRO should continue to support the NSSO for
    planning, programming, and defense acquisition processes. This will
    support DOD-wide efforts to provide information sharing, alignment,
    and/or integration. This will result in optimizing government resources
    and leveraging expertise. It is important that the DOD and the
    Intelligence Community work closely together in order to provide
    transparency and leverage space activities across NSS. This
    collaboration will improve situational awareness for both the black and
    white space communities. The critical element is that there is
    collaboration, not that it comes solely from the DOD EA for Space's NSS
    Organization.
        Dr. Sega. The NSSO continues to develop coordinated, synchronized,
    and integrated capabilities to support the DOD and the Intelligence
    Community. The NSSO does this through NSS architectures, strategies,
    and the NSS Plan. NRO support is important and the NRO continues to
    fund some NSSO led studies.

                                    TACSAT-2

        11. Senator Bill Nelson. Dr. Sega, could you provide an update on
    TACSAT-2, including the various sensors and how they are operating,
    including the solar panels and the resolution of the NRL sensor and the
    impact of this issue for future TACSATs?
        Dr. Sega. Consistent with the event-driven check-out/testing
    process, one experiment, the Miniaturized Vibration Isolation
    Experiment (MVIS), remains to be activated. The remaining 11
    experiments are performing well and the detailed status of each will be
    provided in a separate briefing to your staff.
        The power from TACSAT-2's main solar arrays is sufficient to power
    all satellite/experiment requirements. Additionally, there are two
    experimental solar arrays on the satellite. One experimental array has
    fully deployed and is producing approximately 50 percent of expected
    output power. The second experimental array has not been able to be
    fully deployed and is not producing power. Attempts will be made to
    redeploy this array.
        The TACSAT-2 experiment team is working with appropriate government
    agencies to address intelligence oversight and data handling processes
    associated with data gathered by the experimental payloads. As lessons
    are learned from the TACSAT-2 experiment, they will be transitioned to
    other experimental programs.

        12. Senator Bill Nelson. General Chilton, General Shelton, and
    Admiral McArthur, do you see operational interest in the various
    sensors on TACSAT-2 or any residual operational capability?
        General Chilton. Two of the experiments aboard TACSAT-2 are
    receiving operational interest, the Imager and the Target Indicator
    Experiment which collects radio, radar, and handheld communication
    signals and will monitor the automated identification signal now
    required on large ocean-going vessels. The Air Force and NRLs are
    performing checkout and calibration of both of these sensors. The
    spacecraft is planned to participate in a series of exercises through
    the summer to evaluate the potential military utility of these sensors.
    At the completion of that process, the capabilities of the spacecraft
    will be well-understood, and if appropriate, made available for
    operational use.
        General Shelton. TACSAT 2 satellite signals intelligence and
    imagery payloads are in test and checkout by the NRL and AFRL. A
    Military Utility Assessment will commence with exercise Talisman Saber
    (18-30 June 2007). This exercise will confirm the military utility of
    the two primary sensors and will provide insights for process
    improvements and more timely distribution of data directly to the
    requesting warfighter in theater. If our expectations for TACSAT-2 are
    realized, we will make plans for residual operations.
        Admiral McArthur. Absolutely. TACSAT-2 was successfully launched on
    16 December 2006 and the Navy has already lost several experimentation
    opportunities over the last months for the Target Indicator Experiment
    (TIE), which brings with it an AIS-based ship tracking capability.
    Another such opportunity could be lost, an experiment that could show
    cross-mission ELINT geolocation during upcoming exercise Talisman
    Saber. Additionally, NRL will likely be hard-pressed to complete the
    ACTD requirements in a timely manner given the fact that this payload
    will now be competing with the other 12 payloads for limited power,
    downlink time, and general attention. Assuming that suitable, alternate
    exercise and experimentation venues can be identified, the current
    delay associated with TACSAT-2 is also eating into any residual
    operational capability that may exist. Navy is anxious to experiment
    with the STRATCOM ORS CONOPS after the ACTD and MUA requirements have
    been met. Progress is being made to resolve the issues currently
    hindering experimentation and testing of the TIE and imagery payloads,
    and we are hopeful that viable interim solutions will be in place
    soonest as everyone works toward a long-term solution. The potential
    operational impact of these experimental payloads cannot be overstated
    and would be effectively utilized by Navy as we conduct global
    operations and continue to build regional and global Maritime Domain
    Awareness (MDA).

                             STARFIRE OPTICAL RANGE

        13. Senator Bill Nelson. Dr. Sega and General Chilton, could you
    please explain the full purpose of the Starfire Optical Range (SOR) in
    New Mexico?
        Dr. Sega. SOR is part of the AFRL and is located on Kirtland Air
    Force Base, NM. For over 20 years, SOR has been the premier DOD site
    for the development of atmospheric compensation technologies and
    related advanced optical and beam control technologies. The principal
    activities of the SOR include improving SSA research and development,
    and the understanding of laser propagation through various atmospheric
    conditions.
        General Chilton. The SOR is the U.S. premier research facility on
    adaptive optics and ground-based imaging research, and developing new
    ways to detect, track, and identify objects in space. It is an AFRL
    facility and is not funded by AFSPC. AFSPC works closely with the SOR
    to help evaluate emerging technologies for potential integration into
    operational SSA missions. The activities at SOR which interest AFSPC
    are active tracking, small object detection, low earth orbit object
    characterization and deep space imaging. The integration of adaptive
    optics and low power solid state lasers, enables SOR to measure the
    turbulence in the atmosphere and ``adapt'' the optics within the
    telescope to collect very good, high resolution imagery of space
    objects from the ground. This imagery can be used for anomaly
    resolution, low earth orbit characterization and small/dim threat
    detection (such as micro-satellites). Historically, the SOR (and its
    sister site at Maui) have been limited to operating when the site is in
    the dark and the objects are lit by the sun. This limited timeframe
    severely limits the amount of satellite passes the SOR (or Maui) can
    track or image. Today, the SOR is working to develop new imaging
    technologies which could pioneer good quality day and night imaging and
    tracking data, giving the United States its only 24/7 ground-based
    optical SSA mission. AFSPC hopes to transition these efforts in the
    near future.

        14. Senator Bill Nelson. Dr. Sega and General Chilton, is the SOR
    laser being developed for possible use as a laser weapon to damage,
    disable, or destroy satellites?
        Dr. Sega. No, the lasers located at the SOR are low power lasers
    used for tracking space objects and in developing advanced beam control
    technology for imaging applications. This equipment does not generate
    enough energy for weapons class applications. SOR also has an extensive
    Predictive Avoidance System to ensure it is operated in a safe manner.
        General Chilton. No, the lasers located at SOR are low power lasers
    used for tracking space objects and correcting for atmospheric
    turbulence while tracking or imaging. This equipment does not generate
    enough energy for weapons class applications. Even so, SOR has an
    extensive Predictive Avoidance System to ensure it is operated in a
    safe manner. There is no existing weapon system and there are no plans
    to build one using the SOR equipment.

        15. Senator Bill Nelson. Dr. Sega and General Chilton, are the
    adaptive optics being used to increase the power of the laser?
        Dr. Sega. Adaptive optics are used to remove distortions in the
    optical path resulting in a more uniform phase front and sharper image.
        General Chilton. The current SOR equipment configuration does not
    propagate either of the low power tracking or atmospheric compensation
    lasers through the adaptive optics system. Transmitting a laser through
    an adaptive optics system would require significant modification to the
    optics beam train and the facility itself. It is important to add a
    technical note: adaptive optics would not increase the power of the
    laser in any case. The adaptive optics system could increase the amount
    of energy transmitted by correcting for atmospheric turbulence, but the
    power of the laser is fixed upon installation.
                                     ______

                   Questions Submitted by Senator Mark Pryor

                          CHINESE ANTI-SATELLITE TEST

        16. Senator Pryor. General Chilton, I found our conversation in my
    office recently very interesting, specifically the issues surrounding
    the kinetic ASAT test conducted by China earlier this year. I am
    extremely concerned about the implications this test has had toward our
    national security, particularly given the fact that many of our
    military and weather satellites are operating in the same low earth
    orbit as the destroyed Chinese weather satellite. What are your
    concerns and how are we responding to this incident?
        General Chilton. My top priority is providing Maj Gen Shelton,
    Commander of JFCC-SPACE, with the SSA he requires to effectively
    operate and protect our space systems. With our Nation's growing
    dependency on capabilities provided from all orbital regimes, it
    becomes increasingly important that we identify, characterize, and
    defeat any threat to our space systems. Equally important, we must
    attribute who or what caused any interruption or loss of capability.
    Without adequate SSA, key leaders are denied the information they need
    to employ the full range of political, economic, or military options to
    deter or counter space threats.
        To address this concern, we are advancing key programs. In fiscal
    year 2008, we begin development on an ISSA program, replacing our 1990s
    vintage Space Defense Operations Computer with a net-centric, services-
    oriented architecture that will provide the combatant commanders and
    national users with actionable information on launches, satellite
    breakups, maneuvering objects, and reentries. The RAIDRS Block 20
    program will fuse and exploit ISSA data, enabling JFCC-SPACE to better
    protect critical space assets and respond to emerging threats.

                                  SPACE DEBRIS

        17. Senator Pryor. General Chilton, we also talked about the unique
    implications of space debris. I understand the significance a piece of
    debris, even the size of a penny, has on orbiting satellites or even
    space operations. Is there any international governing body that
    monitors these debris fields, and what kind of reprisal, if any, may be
    levied upon a country that irresponsibly contributes to the pollution
    of space?
        General Chilton. There is no international governing body that
    monitors debris. Only the United States and the Russian Federation have
    debris catalogues. The U.S. system is superior to the Russian's. The
    European Space Agency is considering proposals to develop its own
    monitoring system and catalogue, but has not done so. Many space-faring
    countries have individual sensors that are able to detect or track
    debris, but do not have a continuous or comprehensive system for debris
    cataloging. The Interagency Debris Coordination Committee (IADC) is an
    international body with representatives from all the major space-faring
    countries. The IADC created guidelines that help mitigate the debris
    problem, but the IADC does not have the mandate or the resources to
    monitor debris.
        There are no enforceable legal mechanisms in place to deter
    countries from creating large debris fields. The existing legal regime
    could, under certain circumstances, result in a country being liable
    for damage it causes in outer space, but only if there was some
    negligence or fault. The act of creating debris, by itself, is not
    specifically regulated by existing international law, including
    treaties, governing activities in outer space. In June 2007, the
    Committee on the Peaceful Uses of Outer Space (COPUOS), the United
    Nations' body that makes recommendations to the General Assembly
    concerning activities in space, will consider a report proposing non-
    binding debris-mitigating measures. One of the measures suggests
    avoiding intentional destruction of space objects, and when necessary,
    conducting those activities only at very low altitudes to limit the
    lifetime of the debris.

                     UNITED STATES SPACE COMMAND RETENTION

        18. Senator Pryor. Dr. Sega, I can imagine the United States Space
    Command requires unique and specifically qualified personnel with the
    appropriate technical foundations to effectively carry out the mission.
    What challenges do you have with recruitment and retention?
        Dr. Sega. Attracting and retaining good people is a continuing
    focus of the NSS community. The Space Professional Oversight Board
    (SPOB) provides the overall DOD oversight and includes participation of
    organizations outside of the DOD. Additionally, the National Defense
    Education Program (NDEP) provides scholarship opportunities in math,
    science, and engineering to support the development of a technical
    workforce in critical disciplines across the DOD.
        The Commander of Air Force Space Command (General Chilton) is the
    Space Professional Functional Authority (SPFA) for the Air Force, and
    is responsible for the health of the Air Force Space Professional
    Community. He has also established a SPFA Advisory Council, which
    provides recommendations on policy and guidance that directly impact
    space personnel development. Assignment policies are currently being
    reviewed with a focus on accurate placement of technically qualified
    officers in positions that effectively use their skills in challenging
    jobs throughout their careers. Also, educational opportunities are
    being expanded through the National Security Space Institute (NSSI) and
    military/civilian institutions to enhance individual competencies and
    help Air Force Space Professionals achieve educational and training
    goals.

                            FUNDING SPACE OPERATIONS

        19. Senator Pryor. Dr. Sega, could you explain your request for
    incremental funding for space operations?
        Dr. Sega. The Air Force would like the flexibility to implement an
    alternative funding approach for its major space systems that require
    uninterrupted continuity of service. Incrementally funding the
    procurement for major space programs in areas such as missile warning;
    strategic communication; and position, navigation, and timing, is one
    approach to achieving better budget stability across the space
    portfolio. Another viable solution could be to increase the number of
    satellites that can be developed using RDT&E funding.
                                     ______

                  Questions Submitted by Senator Jeff Sessions

                         OPERATIONALLY RESPONSIVE SPACE

        20. Senator Sessions. Dr. Sega, with regard to ORS, I wanted to ask
    you about the role that you envision for the Army. The Army is the most
    intensive user of space-based capabilities. I am concerned because the
    Army's definition of ``operationally responsive'' is likely to be
    different from that of the Air Force. Without Army engagement early in
    the process, ORS may produce capabilities that are too slow or
    otherwise not sufficiently focused on the needs of warfighters on the
    ground. I want to make sure that the ORS program remains true to the
    mission of supporting the joint tactical warfighter and not evolve into
    a strategic gap filler. Does the recently prepared DOD report on ORS
    include a discussion of the Army's role, specifically the role of the
    Army SMDC?
        Dr. Sega. Yes, the Army SMDC has been heavily involved in ORS
    efforts, highlighted in the ``Plan for Operationally Responsive Space''
    submitted to Congress on April 17, 2007, which states, ``The TACSAT
    Demonstration Program, with participation from the AFRL, NRL, the
    Army's SMDC, and AFSC is the principal test bed for proving out the
    technologies required to develop and field future ORS space
    capabilities.'' The SMDC provides planning, integration, control, and
    coordination of land forces' exploitation of space capabilities. SMDC
    will contribute a land component warfighting perspective essential to
    guiding the choices for ORS and ensuring emerging capabilities are
    relevant and suitable to ground troops.
        The DOD, with participation from all Services and multiple
    government agencies, has defined ORS as the ability to rapidly develop
    and field space capabilities that satisfy the needs of the JFC.
        On May 21, 2007, a joint ORS Office was stood up at Kirtland Air
    Force Base, New Mexico, to engage with Services early in the
    acquisition process and to produce solutions tailored to the
    warfighters. The plan is for joint participation, from all the
    Services, organizations involved in space development activities, and
    users of space capabilities in ORS.

        21. Senator Sessions. Dr. Sega, what conclusions did the report
    team reach?
        Dr. Sega. A joint/interagency team prepared the ``Plan for
    Operationally Responsive Space,'' which was signed out by the Deputy
    Secretary of Defense to Congress on April 17, 2007. This plan
    highlighted several points that are important in establishing a common
    understanding of steps necessary to implement ORS. Some of these
    highlights are:

              A community-wide effort is essential to develop and execute a
            comprehensive plan for ORS. This includes defense,
            intelligence, and civil agency participation with perspectives
            from warfighters, operators, scientists, developers, and
            acquirers.
              The stand-up of the ORS office and the acquisition of ORS
            capabilities must champion the intent to develop, acquire,
            field, and employ space capabilities in shortened timeframes in
            more affordable ways that are directly focused on the end
            users. Additionally, the ORS office must be more than a program
            office and should take on the role of integrator of ORS efforts
            throughout the community.
              The scope of ORS is more than rapid launch and small
            satellites, and should emphasize a tiered approach to improving
            responsiveness. This approach first employs existing
            capabilities; second, deploys field-ready capabilities; and
            third, develops new capabilities.
              ORS initiatives must be complementary to existing space
            systems and capabilities.

        22. Senator Sessions. Dr. Sega, how are you going to ensure that
    ORS is a joint program?
        Dr. Sega. Leadership and oversight are critical to ensuring ORS is
    a joint program. We are developing the ORS office, which stood up at
    Kirtland Air Force Base on May 21, 2007, as a joint organization and we
    will also have a structure, the ORS Executive Committee (EXCOM), to
    provide continuing joint/interagency advice on how to best execute our
    ORS program. ``The Plan for Operationally Responsive Space'' (submitted
    to Congress on April 17, 2007) states that within the ORS office ``the
    positions will be staffed with trained personnel from all Services,
    agencies, and the Intelligence Community and the Reserve components.''

        23. Senator Sessions. Dr. Sega, specifically, how are you going to
    ensure balanced leadership and participation across the Services?
        Dr. Sega. We developed ``The Plan for Operationally Responsive
    Space'' (submitted to Congress on April 17, 2007) as a joint
    undertaking, with participation across the Services and several other
    organizations--inclusive of all interested stakeholders throughout the
    defense, intelligence, and civil space communities.
        The joint ORS office will be manned by representatives from across
    the Services and agencies. The success of the ORS concept is critically
    dependent on Army, Navy, Air Force, and Marine Corps involvement, as
    well as a balanced mix of expertise across the operations, science and
    technology, and acquisition communities.
        We are also implementing an ORS EXCOM, made up of senior leaders
    from across the NSS community, to include the Services and other
    government agencies, to provide ``strategic guidance and the senior-
    level commitment required for success'' (reference ``The Plan for
    Operationally Responsive Space''). The EXCOM will be led by the
    Commander, United States STRATCOM) and the DOD EA for Space and will
    provide recommended ORS priorities for joint ORS efforts.

        24. Senator Sessions. Dr. Sega, the Army has requested that an Army
    officer be named as Deputy Director of the newly-established ORS
    Program Office. Do you expect that this request will be accepted?
        Dr. Sega. The ORS office was activated on May 21, 2007 and is
    currently in the process of staffing the organization's initial cadre.
    Once staffed, there will be a minimum of one Deputy Director within the
    office. As the ORS effort matures, there may be multiple Deputy
    Directors selected for the ORS office to achieve objectives, to balance
    the office's community representation, and to capture the breadth of
    expertise across the NSS community.
        We encourage each of the Services to nominate qualified candidates
    for the Deputy Director positions. These positions, along with all the
    military and civilian positions in the ORS office, are being defined
    this summer and detailed position descriptions are being written. In
    fact, the Army is actively participating in the effort to define the
    full-up ORS office staffing requirements, and will remain an important
    partner in improving the responsiveness of space capabilities to
    address the needs of our troops on the ground.

        25. Senator Sessions. Dr. Sega, who will ultimately decide how ORS
    roles, missions, and budgets are divided among the Services?
        Dr. Sega. From ``The Plan for Operationally Responsive Space''
    (submitted to Congress on April 17, 2007):

              The ORS EXCOM will provide senior-level recommendation for
            the ORS Director concerning personnel and resources from across
            the NSS agencies, while providing strategic guidance and the
            senior level commitment required for success.
              The DOD EA for Space will provide direct oversight of the ORS
            Office and serve as the Service Acquisition Executive for the
            Office's efforts. The DOD EA for Space will also convene the
            ORS EXCOM in coordination with the Commander of the U.S.
            STRATCOM (CDRUSSTRATCOM).
              The CDRUSSTRATCOM will provide operational oversight for all
            ORS activities consistent with the UCP and other applicable
            authorities.
              The responsibility of the ORS Director will be to serve as
            the head of the Office and provide authority, direction, and
            control over the personnel and resources in the ORS office. The
            ORS Director will report to the DOD EA for Space.

        26. Senator Sessions. Dr. Sega, how will the ORS program office
    ensure that joint resources are made available for the other Services
    to develop concepts, technologies, sensors, and platforms?
        Dr. Sega. We intend that the requested ORS program budget, which
    will be augmented by funding from each of the Services and several
    other government agencies, will be used to fund the development,
    demonstration, acquisition, and deployment of ORS capabilities. We
    intend to use the entire NSS community to help develop concepts and
    solutions and then to execute this work using highly-qualified
    organizations. Additionally, an EXCOM, consisting of representatives
    from the Services and agencies involved in ORS, will provide senior-
    level recommendations concerning how best to apportion resources to
    support identified priorities.

        [Whereupon, at 4:06 p.m., the subcommittee adjourned.]

    DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR
                                      2008

                                  ----------

                             WEDNESDAY, MAY 2, 2007

                                   U.S. Senate,
                      Subcommittee on Strategic Forces,
                                   Committee on Armed Services,
                                                        Washington, DC.

              DEPARTMENT OF ENERGY ATOMIC ENERGY DEFENSE PROGRAMS

        The subcommittee met, pursuant to notice, at 2:39 p.m. in
    room SR-232A, Russell Senate Office Building, Senator Bill
    Nelson (chairman of the subcommittee) presiding.
        Committee members present: Senators Bill Nelson, Sessions,
    and Thune.
        Majority staff member present: Madelyn R. Creedon, counsel.
        Minority staff members present: Michael V. Kostiw,
    Republican staff director; and Kristine L. Svinicki,
    professional staff member.
        Staff assistants present: Kevin A. Cronin and Jessica L.
    Kingston.
        Committee members' assistants present: Christopher Caple,
    assistant to Senator Bill Nelson; Todd Stiefler, assistant to
    Senator Sessions; and Jason Van Beek, assistant to Senator
    Thune.

           OPENING STATEMENT OF SENATOR BILL NELSON, CHAIRMAN

        Senator Bill Nelson. Good afternoon. We originally had this
    hearing scheduled in April, but we had to move it because of
    the Senate schedule at the time. Secretary Bodman was to be one
    of the witnesses, but he cannot be here today. He has
    graciously agreed to respond to any questions for the record
    that we want to submit.
        Welcome to James Rispoli, Assistant Secretary of Energy for
    Environmental Management, and Glenn Podonsky, the Chief Health,
    Safety, and Security Officer. Each of you has a prepared
    statement and it will be part of the official record. We are
    going to have a conversation here, so we do not want you
    reading testimony to us.
        Mr. Secretary, we look forward to hearing from you about
    the waste treatment plant project in Hanford, Washington, as
    well as the overall status of the Department's efforts to clean
    up and safely dispose of radioactive and other hazardous
    wastes.
        Mr. Podonsky, you head the newly created office with
    oversight responsibilities covering safety, security, and
    health, and we want to discuss some of the security issues
    today.
        [The prepared statement of Senator Bill Nelson follows:]

                   Prepared Statement by Senator Bill Nelson

        Good afternoon. This hearing was originally scheduled for April 27,
    but because of the Senate schedule we had to move the hearing to today.
    Secretary Bodman was to be one of the witnesses, but unfortunately his
    schedule was unable to accommodate the new date. His prepared statement
    will be included in the record. Secretary Bodman has also graciously
    agreed to respond to any questions for the record that members might
    have.
        It is a pleasure to welcome James Rispoli, Assistant Secretary of
    Energy for Environmental Management, and Glenn Podonsky, the Chief
    Health, Safety, and Security Officer today.
        I note that each of you, has a prepared opening statement, and
    without objection, they will also be included in the hearing record.
        Secretary Rispoli, we look forward to hearing from you about the
    Waste Treatment Plant project at the DOE site in Hanford Washington, as
    well as the overall status of the Department's efforts to clean up and
    safely dispose of the radioactive and other hazardous wastes from the
    Cold War.
        Mr. Podonsky, you head a newly created office with significant
    oversight responsibilities, covering safety, security and health. Among
    other issues we would like to specifically discuss some of those
    security issues today.

        Senator Bill Nelson. Senator Sessions.

                   STATEMENT OF SENATOR JEFF SESSIONS

        Senator Sessions. Thank you, Mr. Chairman. This is an
    important hearing for a lot of reasons. One is the cost that we
    will be spending through the Department of Energy (DOE) for
    defense programs.
        I welcome our witnesses today and thank you for your
    service. I would just note that in the Department's most recent
    financial statements as of September 30, 2006, life cycle cost
    of the environmental management (EM) program was reported as
    $173 billion over 30 years of work. I cannot express how
    frustrating it is to read this statement contained in Secretary
    Bodman's written testimony for this hearing.
        He said: ``The environmental management program has
    experienced setbacks. At the core of these setbacks are
    optimistic planning assumptions that have not materialized,
    combined with new scope and requirements that were not
    anticipated. As a result, EM estimates the life cycle cost of
    the program could increase by $50 billion.''
        This is a staggering cost increase. If any other defense
    program under the jurisdiction of this committee reported a
    cost increase of this magnitude, Senator Nelson would melt
    down, I suspect. In the world of nuclear environmental issues,
    however, we do not seem to be able to confront these issues
    effectively.
        Let us think about what even $10 billion in defense funding
    could buy. $10 billion is more than the entire annual budget of
    the Missile Defense Agency. With $10 billion the United States
    Navy could buy 40 Littoral Combat Ships, and 45 next generation
    refueling tankers.
        So I do not mean this totally in this fashion, but to
    blithely spring on Congress a $50 billion increase for a
    cleanup program is shocking to me. I believe we need to
    evaluate this fundamentally. I believe it is a policy debate
    also, not just a technical debate.
        The reality is that most of these sites will be locked away
    and inaccessible on Federal reservations for the foreseeable
    future. We have to deal with it. We have to have a cleanup
    program, and certainly rivers and bodies of water cannot be
    polluted. But I think we need to ask ourselves real carefully
    how we can manage such a huge financial cost.
        I will be asking some questions as we go forward about how
    the Department and the Secretary can challenge these numbers
    and rethink maybe what we are doing and see if we cannot bring
    down these costs substantially.
        There are a lot of other important issues, but that was one
    that was in my craw a bit. Thank you, Mr. Chairman.
        [The prepared statement of Senator Sessions follows:]

                  Prepared Statement by Senator Jeff Sessions

        I would like to join Senator Nelson in welcoming our witnesses this
    morning. I appreciate the accommodation you both have made in
    rescheduling this hearing from last week. Although Secretary Bodman is
    not able to be here at this time, I understand that his testimony will
    be accepted for the record and members will be able to submit questions
    to him in writing.
        Today, the subcommittee will hear from two witnesses regarding
    significant elements of the Department of Energy (DOE). From Assistant
    Secretary James Rispoli, we will hear about the cleanup of DOE sites
    across the Nation through the Department's Environmental Management
    program. Mr. Podonsky will address the cross-culling issues and
    challenges he oversees as the Chief Health, Safety, and Security
    Officer of the Department.
        Assistant Secretary Rispoli, I appreciated the discussion we began
    in your appearance before the subcommittee last year, where we explored
    the cost and regulatory pressures within which you must address the
    environmental contamination and eventual cleanup of DOE sites. This is
    a tough challenge, from many different aspects, and the cost control on
    these projects has not been what many of us would desire. I am deeply
    concerned about the statement contained in Secretary Bodman's written
    testimony that the life cycle cost of the Environmental Management
    program may increase by approximately $50 billion due to ``optimistic
    planning assumptions that have not materialized combined with new scope
    and requirements that were not anticipated.'' This is a staggering cost
    increase. Let's think about what even $10 billion in defense funding
    could buy. Ten billion dollars is more than the entire annual budget of
    the Missile Defense Agency. With $10 billion, the U.S. Navy could buy
    40 Littoral Combat Ships, 45 next-generation refueling tankers, or even
    2 Nimitz-class aircraft carriers.
        I will continue to explore my concerns about the cost of this
    program, both in our hearing today, and as we proceed with the National
    Defense Authorization Bill. I hope your testimony will provide further
    information about this matter.
        Mr. Podonsky, you are the head of a newly formed organization
    within the Department, or perhaps more accurately, a new office which
    pulls together many existing health, safety and security functions
    within the Department. As I understand it, the objective in standing up
    this new office was to provide the Secretary of Energy with a more
    coherent view of the performance of his Department from the standpoint
    of safety, security, and worker health. I look forward to hearing your
    perspectives on whether this new organization is meeting the goals set
    out for it.
        When Secretary Bodman appeared before the full Armed Services
    Committee last year to testify on the DOE budget, I outlined a pretty
    hard-hitting assessment of the manner in which the Department was
    carrying out the programs assigned to it, and the improvement I thought
    was needed. After reflecting on my assessment, Secretary Bodman replied
    that he would agree with many of my criticisms--that the Department can
    and must do better. I appreciate that the Department has been working
    to improve its management and execution of projects by, for example,
    increasing the training and capability of project managers and
    contracting officers working at DOE. In my view, however, substantial
    challenges remain.
        I am still concerned about the cost and expectations for the DOE
    environmental cleanup program. In Washington State, the Environmental
    Protection Agency recently fined the Department of Energy over $1
    million in a regulatory dispute over the cleanup at Hanford. We have
    one part of the Federal Government fining another, and at the end of
    the day, it is all the same taxpayer money. We need to keep in mind
    what exactly the objectives for this cleanup really arc.
        Although Secretary Bodman could not be here today, his written
    testimony addresses the Reliable Replacement Warhead program. I believe
    that Congress should approve the next evaluation phase of the program,
    but I believe that DOE should examine the cost of this program very
    closely. In my view, this program should not be a vehicle for
    recreating a laboratory complex sized for Cold War missions. The
    Federal Government has a long history of pursuing weapons development
    programs that--we are told--are going to ``save money'' and then the
    savings get lost somewhere along the way.
        Let me again join our chairman in thanking our witnesses for their
    service and for appearing here today. I look forward to their testimony
    on these important matters.

        [The prepared statement of Secretary Bodman follows:]

                  Prepared Statement by Hon. Samuel W. Bodman

        Chairman Nelson, Ranking Member Sessions, and members of the
    subcommittee, I am pleased to be with you this afternoon to present the
    President's fiscal year 2008 budget proposal for the Department of
    Energy (DOE).
        With programs such as the Reliable Replacement Warhead (RRW), Mixed
    Oxide Fuel Fabrication Facility (MFFF), Hanford Waste Treatment Plant
    and other defense related activities, the fiscal year 2008 budget seeks
    to meet the DOE's responsibilities in national security and
    environmental cleanup. Before I discuss these further I would like to
    take a moment to briefly mention the President's energy initiatives
    announced during the State of the Union. President Bush has called on
    this country to reduce gasoline usage by 20 percent in the next 10
    years. We have named this our ``Twenty in Ten'' plan and I urge you to
    support this ambitious proposal. America's oil dependence leaves us
    more vulnerable to hostile regimes as well as terrorists who target oil
    shipments to harm our economy.
        America will reach the President's ``Twenty in Ten'' goal by
    requiring the use of 35 billion gallons of renewable and alternative
    fuels by 2017, while also reforming the Corporate Average Fuel Economy
    standards for cars and extending the current light truck rule. In 2017,
    the combined savings of these measures are projected to reduce annual
    gasoline use by 20 percent.
        The President's plan eases threats posed to energy security by
    encouraging alternative fuels and environmentally sensitive domestic
    oil production, while also insuring against disruptions by doubling the
    current capacity of the Strategic Petroleum Reserve to 1.5 billion
    barrels by 2027.
        Coupled with the Advanced Energy Initiative and the American
    Competitiveness Initiative, which were launched a year ago, these
    proposals offer a strong plan to enhance America's future security, and
    I encourage members of the committee to join us in pursuing these
    proposals.
         highlights of the fiscal year 2008 department of energy budget
        The President's fiscal year 2008 budget reflects the Department's
    commitment to protect the United States as stewards of our Nation's
    nuclear weapons stockpile and to environmental cleanup. To highlight,
    the fiscal year 2008 budget for the DOE emphasizes investments that
    will:

             Transform Our Nuclear Weapons Complex. The fiscal year
            2008 budget reconfirms the DOE's steadfast commitment to the
            national security interests of the United States through
            stewardship of a reliable and responsive nuclear weapons
            stockpile and by advancing the goals of global
            nonproliferation. Through the National Nuclear Security
            Administration (NNSA), the Department directs $6.5 billion in
            this request for Weapons Activities, a $103 million increase
            from the fiscal year 2007 request, to meet the existing
            requirements for stewardship of the Nation's nuclear weapon
            stockpile, technologies and facilities, as well as to continue
            to revitalize the nuclear weapons complex with the goal of a
            much smaller size by 2030. To do so, we developed a
            transformation concept and vision, the cornerstones of which
            are ``Complex 2030'' and the RRW. We are moving forward to
            implement this strategy now, bringing us closer to achieving an
            even smaller stockpile that is not only safer and more secure,
            but one that also reduces likelihood of United States
            underground nuclear testing. Ultimately, this approach enables
            a much more responsive nuclear weapons infrastructure.
             Reduce the Risk of Weapons of Mass Destruction (WMD)
            Worldwide. The fiscal year 2008 budget provides $1.7 billion
            for Defense Nuclear Nonproliferation, for a comprehensive set
            of programs to meet our commitment to detect, prevent, and
            reverse the proliferation of WMD in close cooperation with our
            partners around the world. This program is an administration
            priority and while the funding amount shows a 3 percent
            decrease, this reflects accelerated completions in fiscal year
            2007. Further, the request provides significant out-year growth
            to fulfill our international agreements and accelerate our work
            to reduce the risk of WMD threats. Among many advances, the
            fiscal year 2008 budget for example will further our work in
            the Megaports program by initiating the installation of
            radiation detection equipment at the Port of Hong Kong.
              Because keeping terrorists from acquiring materials will be
            easier if we limit enrichment of uranium or reprocessing of
            spent fuel, the President proposed in 2004 a new initiative,
            the Global Nuclear Energy Partnership (GNEP), which would
            provide nations which refrain from developing or deploying
            enrichment and reprocessing technology assured access to the
            benefits of nuclear power.
             Meet Our Commitments to Public Health and Safety and
            the Environment. During my first days at the DOE, I announced
            safety as my top priority and the number one operating
            principle of the Department. To implement this vision, we
            created a new Office of Health, Safety, and Security. As I said
            at the time, ``As Secretary of Energy, ensuring the safety of
            workers across the DOE complex is my top priority and this new
            office will go a long way in strengthening our safety and
            security organization. We must be world class not only in how
            we carry out our mission, but in the safe, secure, and
            environmentally responsible way in which we manage operations
            at our facilities across the country.'' The organization's
            fiscal year 2008 budget request of $428 million, builds on a
            number of actions the Department has taken over the past 2
            years to increase safety of DOE workers.
              The fiscal year 2008 budget includes $5.4 billion for
            defense-related Environmental Management (EM) programs to
            protect public health and safety by cleaning up hazardous,
            radioactive legacy waste left over from the Manhattan Project
            and the Cold War. Past investments have resulted in the
            completed clean up of 81 sites through the end of fiscal year
            2006, including Rocky Flats, Colorado, and a total of 86 sites
            by the end of fiscal year 2007, including the Fernald site in
            Ohio, which was completed in January 2007. This budget allows
            the program to continue to make progress towards cleaning up
            and closing sites and focuses on activities with the greatest
            risk reduction.
              As the Department continues to make progress in completing
            clean up, the fiscal year 2008 budget request of $159 million
            for Legacy Management (LM) supports the Department's long-term
            stewardship responsibilities and payment of pensions and
            benefits for our former contractor workers after site closure.
              In light of the increased number of sophisticated cyber
            attacks directed at all facets of our communities, from
            military to civilian to private users, the Department is taking
            significant steps to secure the virtual pathways and mitigate
            the threat from cyber intrusions. Implementing these steps will
            be seamless and will not interrupt the availability of
            information systems resources while preserving the
            confidentiality and integrity of the information and their
            contents. A budget request of $170 million in fiscal year 2008
            supports the Department's efforts to defend against emerging,
            complex cyber attacks. Through these efforts, the Department
            will be in a better position to effectively manage and monitor
            cyber risk across the complex. In fiscal year 2008, DOE will
            increase support on a Department-wide basis to deploy new
            cybersecurity tools and cybersecurity management activities to
            detect, analyze, and reduce the threat across the complex.

                      ENSURING AMERICA'S NUCLEAR SECURITY

        The President, in his first days in office, was faced with the new
    and challenging realities of national security in the 21st century. The
    war on terror has substantially and fundamentally reshaped the national
    security programs and activities in the Department. This budget of
    $24.3 billion for the Department is an important component of the
    President's strategy to address some of these very important issues
    facing our Nation. Within the $24.3 billion request in fiscal year
    2008, $9.4 billion or 39 percent is proposed to support DOE's
    contribution to the Federal Government-wide effort to ensure the
    security of our Nation.
        The NNSA continues significant efforts to meet administration and
    secretarial priorities leveraging science to promote national security.
    The fiscal year 2008 budget proposes $9.4 billion to meet defense and
    homeland security-related objectives. The budget request maintains
    current commitments to the nuclear deterrence policies of the
    administration's Nuclear Posture Review (NPR). To implement those
    policies for the long-term, NNSA has established a new planning
    scenario, ``Complex 2030'', to guide the transformation of the complex.
    The fiscal year 2008 budget also continues to fund a high profile
    strategy to mitigate throughout the world the threat of weapons of mass
    destruction, and provides for the nuclear propulsion needs of the U.S.
    Navy. Key investments include:

             Transforming the nuclear weapons stockpile and
            infrastructure while meeting Department of Defense (DOD)
            requirements, through the RRW and other Complex 2030
            initiatives;
             Conducting innovative programs in the Nations of the
            former Soviet Union and other countries to address
            nonproliferation priorities;
             Supporting naval nuclear propulsion requirements of
            the U.S. Navy;
             Maintaining comprehensive security for facilities,
            employees and information implementing and sustaining upgrades
            throughout the complex;
             Providing nuclear emergency response assets in support
            of homeland security;
             Reducing the deferred maintenance backlog and
            achieving facility footprint reduction goals; and,
             Providing corporate management and oversight for NNSA
            programs and operations.

        The United States continues a fundamental shift in national
    security strategy to address the realities of the 21st century. The
    administration's NPR addressed a national security environment in which
    threats may evolve more quickly and be less predictable and more
    variable than in the past. The NPR recognizes the need to transition
    from a threat-based nuclear deterrent with large numbers of deployed
    and reserve weapons, to a deterrent consisting of a smaller nuclear
    weapons stockpile with greater reliance on the capability and
    responsiveness of the DOD and NNSA infrastructure to respond to
    threats. The NNSA infrastructure must be able to meet new requirements
    in a timely and agile manner while also becoming more sustainable and
    affordable. The DOE has created a plan for a revitalized nuclear
    weapons complex called ``Complex 2030''. This significantly more agile
    and responsive complex will allow further reductions in the nuclear
    stockpile by providing an industrial hedge against geopolitical or
    technical problems and will reduce security costs by consolidating
    nuclear materials. The fiscal year 2008 President's budget contains
    some of the resources required for transformation of the complex in
    ongoing base program activities that are already underway and
    contributing to Complex 2030 objectives. The administration is still
    studying plans and funding projections for other parts of the effort.
        The fiscal year 2008 budget request of $6.5 billion for Weapons
    Activities includes all programs to meet the immediate needs of the
    stockpile, stockpile surveillance, annual assessment, and life
    extension programs. On November 30, 2006, the Nuclear Weapons Council
    determined that the RRW program was feasible as a means for sustaining
    the long-term safety and reliability of the Nation's nuclear deterrent
    force. This shift in strategy from a Life Extension Program to a RRW
    program will require substantial planning and resource realignments by
    the DOD and DOE. The campaigns are focused on long-term vitality in
    science and engineering and on research and development (R&D)
    supporting current and future stockpile stewardship and DOD
    requirements. A number of these NNSA programs and facilities also
    support scientific research users from other elements of the
    Department, Federal Government, and the academic and industrial
    communities. Within the Nuclear Weapon Incident Response programs, a
    new National Technical Nuclear Forensics R&D and operations program is
    established, as well as a stabilization program through leveraged
    render safe R&D development of first generation equipment in support of
    homeland security. NNSA's Safeguards and Security activities are also
    encompassed within the request for Weapons Activities. The Defense
    Nuclear Security program supports the physical security needs at NNSA
    sites. These activities increase by 17 percent to sustain base program
    increases associated with the fiscal year 2003 design basis threat
    (DBT) upgrades, and a revised schedule for 2005 DBT implementation at
    NNSA sites. Cybersecurity activities, protecting information and
    information technology infrastructure, increase by over 15 percent.
    This will provide for the first step in a major 5-year effort focused
    on revitalization, certification, accreditation, and training across
    the NNSA complex.
        Preventing weapons of mass destruction from falling into the hands
    of terrorists and rogue states is one of this administration's top
    national security priorities. The fiscal year 2008 request of $1.67
    billion for nuclear nonproliferation activities strongly supports the
    international programs that are denying terrorists and rogue states the
    nuclear materials, technology and expertise needed to develop or
    otherwise acquire nuclear weapons. NNSA continues unprecedented efforts
    to protect the U.S. and our allies from threats, including $265 million
    for cutting-edge nonproliferation R&D for improved technologies to
    detect and monitor nuclear proliferation and nuclear explosions
    worldwide. There are additional major efforts focused on potential
    threats abroad. For example, in the area of nuclear material protection
    and cooperation the program has completed security upgrades for Russian
    navy nuclear fuel and weapons storage at the end of fiscal year 2006
    and will complete security upgrades for Rosatom facilities by the end
    of fiscal year 2008. Also by the end of fiscal year 2008, the program
    will complete security upgrades at the nuclear warhead sites of the
    Russian Strategic Rocket Forces and the 12th Main Directorate. To help
    complete the shutdown of three Russian nuclear reactors still producing
    1.2 metric tons of plutonium per year and to replace them with
    conventional fossil fuel power plants, this budget request includes
    $182 million for the Elimination of Weapons Grade Plutonium Production
    program.
        Moreover, the RRW approach reinforces our nonproliferation
    commitments and objectives. Designed with more favorable performance
    margins that are less sensitive to incremental aging effects, these
    warheads would reduce the necessity of nuclear tests for the United
    States to diagnose or remedy a stockpile reliability problem. This will
    bolster efforts to dissuade other countries from testing. Furthermore,
    once a transformed production complex demonstrates that it can produce
    replacement warheads on a timescale to meet emerging geopolitical
    threats, or timely respond to technical problems in the stockpile, then
    we can eliminate many spare warheads and further reduce the nuclear
    stockpile. The RRW strategy will allow us to increase our warhead
    dismantlement rate, sending a strong message to the world that we are
    taking meaningful steps towards further stockpile reductions.
    Additionally, increased confidence in the U.S. nuclear deterrent will
    assure allies and obviate their need to bolster nuclear forces.
    Finally, the improved security features of RRW will prevent
    unauthorized use should a warhead ever fall into the hands of
    terrorists.
        The budget request includes $609 million to support Fissile
    Material Disposition activities. Of this amount, $334 million is
    requested for the U.S. Mixed Oxide Fuel Fabrication Plant project at
    DOE's Savannah River Site in South Carolina. This facility will dispose
    of 34 metric tons of U.S. surplus plutonium and facilitate complex-wide
    consolidation of nuclear material. On April 11, the Deputy Secretary
    approved CD-2, the performance baseline, and CD-3, the start of
    construction, August 1, 2007, for the MFFF project at Savannah River
    Site. As per the restriction in the revised fiscal year 2007 Continuing
    Resolution (Public Law 20-110-5), no construction activities will be
    initiated prior to August 1, 2007, under the authorized limited
    preconstruction activities.
        Various programs funded by NNSA's Defense Nuclear Nonproliferation
    appropriation support the President's Bratislava Nuclear Security
    Cooperation initiative (about $293 million) including security upgrades
    at Russian nuclear warhead sites, and also support the Global
    Partnership against the Spread of WMD ($537 million) to meet the U.S.
    commitment to the G8 nations. In coordination with the Office of
    Nuclear Energy, the budget request also includes $10 million to support
    the GNEP, which is focused on advanced safeguards technology
    development that is crucial to the ultimate success of the GNEP
    initiative.
        NNSA continues to support the United States Navy's nuclear
    propulsion systems. The fiscal year 2008 request of $808.2 million is
    an increase of 1.6 percent over the fiscal year 2007 request level. The
    funding increase assists the Naval Reactors program to ensure the safe
    and reliable operation of reactor plants in nuclear-powered submarines
    and aircraft carriers and fulfills the Navy's requirements for new
    nuclear propulsion plants that meet current and future national defense
    requirements.
    protecting the environment by providing a responsible resolution to the

               ENVIRONMENTAL LEGACY OF NUCLEAR WEAPONS PRODUCTION

        The Federal Government must address the legacy of our past and our
    responsibility to the American taxpayers to provide a clean, safe, and
    healthy environment to live in. A total of $6.34 billion is dedicated
    in fiscal year 2008 to support the three key pillars that set the
    framework for the Department to reach that goal. The first pillar is to
    continue our environmental cleanup ($5.4 billion) of contaminated Cold
    War sites across the country. The second pillar is to continue to
    provide site post-closure management and to carry out our
    responsibilities ($194 million) to our former contractor workers. The
    third pillar completes the framework by working to construct a
    permanent nuclear waste repository at Yucca Mountain ($494.5 million)
    to address long-term nuclear waste disposal and for authorization of
    which the Department will submit a License Application to the Nuclear
    Regulatory Commission not later than June 30, 2008. It goes without
    saying that my core principle of safe operations throughout the
    Department will be applied with vigor within this framework.
        To deliver on the Department's cleanup obligations stemming from 50
    years of nuclear research and weapons production during the Cold War,
    the EM program continues to focus its resources on the highest health,
    safety, and environmental risks, such as treatment of over 90 million
    gallons of radioactive liquid waste stored in decades old tanks;
    disposition of thousands of metric tons of special nuclear material
    (surplus weapons-grade uranium and plutonium), spent nuclear fuel, and
    solid waste stored in older facilities that do not meet today's
    environmental requirements; and remediation of contaminated soil and
    groundwater. Up through fiscal year 2007, DOE will have completed
    cleanup of 86 of 108 legacy nuclear waste sites, with another three
    site cleanup completions--the Pantex Plant in Texas; Lawrence Livermore
    National Laboratory--Site 300 in California, and the Inhalation
    Toxicology Lab in New Mexico--planned for completion in fiscal year
    2008.
        In fiscal year 2008, the budget includes $5.4 billion to continue
    cleanup, giving priority to those activities that offer the greatest
    risk reduction while staying focused on completing cleanup and closing
    sites. This is a reduction from the fiscal year 2007 request of $173
    million, which in part reflects completion of some sites, but also
    reflects hard choices that must be made. Safety remains the utmost
    priority. EM is committed to applying my safety principles and will
    continue to maintain and demand the highest safety performance to
    protect the workers and the communities where EM operates.
        In keeping with the principles of reducing risks and environmental
    liabilities, the fiscal year 2008 request of $5.4 billion will support
    the following priority activities:

             Stabilizing radioactive tank waste in preparation for
            treatment (about 37 percent of the fiscal year 2008 request);
             Storing and safeguarding nuclear materials and spent
            nuclear fuel (about 19 percent of the fiscal year 2008
            request);
             Dispositioning transuranic, low-level and other solid
            wastes (about 16 percent of the fiscal year 2008 request);
             Remediating major areas of our sites and
            decontamination and decommissioning excess facilities (about 19
            percent of the fiscal year 2008 request).

        One of the significant cleanup challenges the EM program faces is
    the construction of the Hanford Waste Treatment and Immobilization
    Plant (WTP), which will treat highly radioactive tank waste at Hanford.
    WTP has encountered significant technical and project management
    problems, which have caused the project to slow down while the problems
    were addressed. With the help of senior professionals from private
    industry, academia and other Government agencies, EM has undertaken an
    intensive review scrutinizing key elements of the project, including
    the technology, cost and schedule, project management, project
    controls, and earthquake seismic criteria. In December 2006, the
    Department approved a revised, validated baseline of $12.3 billion for
    WTP. The Department believes WTP is now back on a sound technical and
    project management footing, and is ready to move forward.
        Despite numerous accomplishments and successfully accomplishing
    site completions, the EM program has experienced setbacks in achieving
    its vision of accelerated cleanup. At the core of these setbacks are
    optimistic planning assumptions that have not materialized, combined
    with new scope and requirements that were not anticipated. As a result,
    EM estimates the lifecycle cost of the program could increase by $50
    billion. EM continues to take steps to address challenges and improve
    the effectiveness and efficiency of its operation. The Department
    remains committed to completing this important and necessary mission.
        After the EM program completes cleanup of closure sites, with no
    further DOE mission, post closure stewardship activities are
    transferred to the Office of LM. Post closure stewardship includes
    long-term surveillance and maintenance activities such as groundwater
    monitoring, disposal cell maintenance, records management, and
    management of natural resources at sites where active remediation has
    been completed. At some sites the program includes management and
    administration of pension and benefit continuity for contractor
    retirees. In fiscal year 2008, $194.2 million is requested to carry out
    legacy management functions at both civilian and defense-related sites.
    The majority of the funding is for long-term stewardship activities and
    pension and post-retirement benefits for former contractor employees at
    the Rocky Flats, Colorado, and the Fernald, Ohio, closure sites.

                                   CONCLUSION

        I appreciate the opportunity to appear before you to present the
    fiscal year 2008 budget proposal for the DOE. I will be happy to take
    any questions that members of the subcommittee may have.

        Senator Bill Nelson. Mr. Secretary?

      STATEMENT OF HON. JAMES A. RISPOLI, ASSISTANT SECRETARY OF
                  ENERGY FOR ENVIRONMENTAL MANAGEMENT

        Mr. Rispoli. Thank you, Mr. Chairman. I interpreted that
    you would prefer we not read our oral statements and that is
    fine. So I thank you, Mr. Chairman and Senator Sessions, for
    having us here today to go over our program.
        Let me just start by addressing the overall program, if I
    may, and both your point on the waste treatment plant and
    Senator Sessions' point on the overall cleanup status.
        If I may, I can start by assuring you that it is not
    business as usual and it is not business as before. We, too,
    are very concerned with the cost of the program. We are doing
    some things that have never been done before. For example, we
    are independently auditing with both the technical and
    financial people the cost of all the projects that make up our
    program. Never been done before, 56 percent of our program has
    passed that independent audit.
        This helps us to ensure that the assumptions and the costs
    that we use are reasonable, and I can----
        Senator Sessions. 56 percent passed?
        Mr. Rispoli. Yes, sir, have been passed. Now, more than 56
    percent have been looked at, but we are still working to answer
    questions and issues on others, because part of our problem has
    been in the past that we have made unreasonable assumptions,
    and if those assumptions do not come true the costs go up, or
    in other cases the estimates are too high and we have to adjust
    them to the right amount. So this is one element that has never
    been done before, taking the entire EM program and subjecting
    it to an independent audit by outsiders that have no play in
    the game. They are not the normal stable of contractors. These
    are totally independent groups that go in and look at our
    projects.
        On the management side, once we believe we have a handle on
    the costs--and again, that is a major effort, to do that--we
    have instituted a much more rigorous management focus using
    project management techniques that are standard in the country.
    This has not been done before. The types of elements that are
    in this are monthly reporting with oversight by a separate
    office not in my organization. A separate office looks at
    monthly reports and reports to my boss, the deputy secretary,
    on whether they think we are managing our projects well or not.
        I get those reports, too. I do a quarterly face-to-face
    review with all of our people in the field. They either come to
    the headquarters for the most part or we tie them in by video
    teleconference, and we review each one of our projects. It is
    an extensive effort once a quarter. It takes the better part of
    2 weeks with huge blocks of time to review these, to make it
    clear to our people in the field that we have a tight rein on
    the way we execute these projects.
        Related to that, we are currently in the midst of doing a
    competency assessment of our own people in the field, because
    our own people, although we have worked at getting them
    certified as project managers, they still are missing some of
    the competencies that we believe they need. We are in the midst
    of assessing that so that we can provide that type of on-site
    assistance to them, for example cost control or schedule
    control. If they do not have those things we want to provide
    that.
        So this is not an inspector general (IG) type of a review.
    This is a review to provide better staffing for the feds at the
    site to provide better, more robust oversight of the
    contractors.
        So the first element is the independent audits. The second
    is the more intense project management focus. The third is, as
    you might be aware, we have created a new organization for
    acquisitions in the Department at headquarters so that we can
    do a better job of writing these contracts with better
    incentives for the contractors to come in under budget or below
    cost.
        So it is not business as before. All of these are major
    focus areas for us. They are all with the purpose of getting
    better cost estimates to start with and then have more credible
    management as we go forward.
        That is for the overall program. If you like, I can address
    the waste treatment plant as well, which is our largest single
    project. As you know, its estimate as validated by the Army
    Corps of Engineers independent review is $12.2 billion. That
    $12.2 billion clearly makes it the Department's largest capital
    project. It is an extensive plant that is designed to empty and
    treat liquid tank wastes in 177 tanks at the Hanford
    Reservation.
        It costs us over $200 million a year just to manage those
    tanks and keep them safe. So it is not a good long-term answer,
    because the worry always is, of course, that the tanks may leak
    over time and put this radioactive liquid waste into the
    ground. But also, in order to once and for all end the problem,
    the plan is that we would process all of that waste through
    this plant that is under construction. It is about 30 percent
    complete at this time.
        The plant will basically take the high-level fraction and
    vitrify it into glass logs that would go to Yucca Mountain, and
    the low activity waste fraction would also go into glass logs,
    for on-site disposal. So there is an element here that would
    remain on the site, which will save the taxpayers a great
    amount of money. But the amount of radioactivity left on the
    site would be minimized by separating the waste into the high-
    level waste fraction and the low activity waste fraction.
        As I mentioned, that plant is now 30 percent done. It has
    been reviewed by the Army Corps of Engineers. We are still
    working through a number of technical issues, but we have had
    an independent team of what we call the best and brightest
    experts review the technical aspects of the plant. They have
    told us in writing that they believe the plant will work.
        We are still working through some of the issues they
    identify, but none of them are considered to be show-stoppers.
    I would say that at this point in time we are a world away from
    where we were last year when we were in the same cycle for the
    budget; I mentioned only two, but when these reviews had not
    yet been done.
        There have been many more reviews of that plant, but I will
    tell you that we have a high degree of confidence that we can
    build this plant for the price tag attached to it. I will also
    tell you that $12.2 billion has a very large amount of
    contingency in it because the project is so long.
        So the idea would be that there is enough room in there to
    bring it in for less than $12.2 billion, because about $3
    billion of that is contingency. The idea being, again, that we
    want to be sure that we have enough room to solve the remaining
    issues, or even unknown issues should they arise, and deliver
    this plant as committed to in our budget to Congress.
        So that is an overview of the waste treatment plant. I
    would be happy to answer any more detailed questions you might
    have on any aspect of that.
        [The prepared statement of Mr. Rispoli follows:]

                  Prepared Statement by Hon. James A. Rispoli

        Good afternoon, Chairman Nelson and members of the subcommittee. I
    am pleased to be here today to address and answer your questions on the
    President's fiscal year 2008 budget request for the Department of
    Energy's Environmental Management (EM) program. I want to thank the
    subcommittee for its support of the EM program.
        The EM mission was undertaken to address the safe and successful
    cleanup of the Cold War legacy brought about from five decades of
    nuclear weapons development and government-sponsored nuclear energy
    research. This mission, as I pointed out last year, is both inherently
    challenging and innately beneficial to the American people. As this
    subcommittee knows the EM program has solved several cleanup
    challenges, including Rocky Flats and Fernald, that at one time seemed
    insurmountable. We are also making progress on the many other complex
    challenges that the program still faces. Since I last appeared before
    this committee, EM has been able to achieve notable results by
    addressing these challenges through a risk reduction and prioritization
    strategy and a judicious use of the resources that Congress entrusts to
    us. EM is implementing this prioritized, risk reduction strategy
    supported by the crucial tenets of safety, performance, cleanup, and
    closure.
        The President's fiscal year 2008 budget request will allow this
    prioritized work on these important cleanup and closure projects to
    continue across the complex. For the EM program, the President's budget
    request for fiscal year 2008 is $5.4 billion for defense EM activities.
    We've been able to achieve a decrease of $26 million from the fiscal
    year 2007 request by employing a thoughtful balance of reducing risk
    and completing cleanup for the EM program. About half of our budget
    request will go towards our highest risks activities in stabilizing
    tank waste, nuclear materials, and spent nuclear fuel, and another
    quarter is going to clean up contaminated soil, groundwater, and unused
    facilities. With this request, we are continuing on our strategic
    course to address high-priority tank waste treatment and radioactive
    waste disposition while preserving our site completion and closure
    drive. Under this strategy, we anticipate meeting 90 percent of the
    approximately 210 scheduled compliance agreement milestones for fiscal
    year 2008. The Department remains committed to meeting its regulatory
    milestones and will continue to identify ways to better manage its
    cleanup activities. Our agreements have provisions for renegotiation of
    milestones and we are working with our regulators to provide the best
    benefit to the environment.
        With this budget request, the Defense Waste Processing Facility at
    the Savannah River Site (SRS), the Advanced Mixed Waste Treatment
    Facility at the Idaho National Laboratory (INL), and the Toxic
    Substance Control Act Incinerator at the Oak Ridge Reservation (ORR)
    will continue to operate. Design and construction will continue at the
    Waste Treatment and Immobilization Plant (WTP) at Hanford, the Sodium-
    Bearing Waste Treatment Plant at INL, and the Salt Waste Processing
    Facility (SWPF) at SRS. Tank farm operations will continue at Hanford,
    INL, and SRS along with spent nuclear fuel receipt, storage, and
    cleanup. I would like to update you regarding two of these important
    tank waste projects.
        The Waste Treatment and Immobilization Plant at Hanford is the
    Department's largest capital project. Over the past 18 months, the
    Department has retained a broad range of external, senior professionals
    from private industry, academia, and other government agencies to
    thoroughly review the management issues, technical approach and
    remaining challenges, adequacy of the design to meet the seismic
    criteria, and the cost and schedule elements of the WTP project. The
    results of these reviews, together with implementing the many
    recommendations, provide the Department with the assurance that the WTP
    can be built and commissioned as designed to treat and immobilize the
    high-level waste, and can be executed within the revised cost and
    schedule baseline.
        Also related to the WTP, the John Warner National Defense
    Authorization Act for Fiscal Year 2007, section 3120, included a
    limitation on availability of funds, pending the certification by the
    Secretary of Energy that the Defense Contract Management Agency has
    recommended for acceptance the earned value management system used to
    track and report costs of the WTP. This limited obligation or expense
    of no more than 90 percent of the funds available.
        A review of the earned value management system was conducted in
    November 2006 and eight issues were identified. In February 2007, the
    WTP contractor submitted corrective actions and those actions should be
    acceptable to resolve seven issues with only minor revisions. The last
    issue has proved harder to resolve and, as a result, the certification
    of the earned value management system by the end of the fiscal year may
    be in jeopardy.
        Salt Waste Processing Facility will provide the high capacity
    treatment capability necessary for removal of actinides, strontium and
    cesium from the more than 33 million gallons of salt waste stored in
    aging underground waste tanks at the SRS. SWPF operation is critical to
    meeting Federal Facility Agreement commitments to remove waste from the
    49 remaining SRS tanks, including the 22 tanks that do not meet modern
    requirements for full secondary containment and leak detection. The
    schedule for the project design has been slowed to address seismic
    issues, which should be resolved in early May. In parallel, the
    contractor will complete baseline development and that baseline will be
    validated upon satisfactory completion of an external independent
    review. This baseline development and validation will support a Fall
    2007 Critical Decision 2 (CD-2), which will establish formally the
    project schedule and cost estimate, against which we report our
    progress, and provide approval to proceed to final project design.
        At the SRS, this request will support ongoing nuclear material
    processing in H-Canyon and design of the plutonium vitrification
    project to support ultimate disposition. At Hanford, it supports
    consolidation of plutonium and unirradiated category 1 and 2 nuclear
    fuel to an off-site location, pending a consolidation decision.
    Consolidation of enriched uranium from INL to an off-site location, and
    design and long-lead procurement for the U-233 disposition project at
    the ORR are also supported in this request.
        This request enables transuranic (TRU) waste projects to continue
    with priority for INL and Los Alamos National Laboratory (LANL) TRU
    waste. Other contact and remote-handled TRU shipments to the Waste
    Isolation Pilot Plant (WIPP) are also supported. Low-level radioactive
    waste and mixed low-level radioactive waste activities will be
    supported at Hanford, the Nevada Test Site (NTS), INL, SRS, and ORR.
        The request will allow high-priority waste retrieval, soil and
    groundwater remediation, and decontamination and decommissioning (D&D)
    of excess facilities at Hanford, INL, SRS, ORR, and other sites. In
    addition, the request supports targeted technology development and
    deployment in support of high-level waste, soil and groundwater, and
    facility D&D.
        With this budget request, EM will achieve our goals for risk
    reduction and cleanup completion at:

             Lawrence Livermore National Laboratory-Site 300,
            California
             Pantex Plant, Texas
             Sandia National Laboratory, New Mexico (calendar year
            2008)

        As cleanup work is completed at these sites with continuing
    missions, EM will transfer long-term surveillance and monitoring
    activities to the NNSA.
        The fiscal year 2008 budget request will allow the EM cleanup
    program to reduce risk, honor commitments and produce results worthy of
    the investment of the American people. We are committed to ensuring
    strong management of this complex cleanup work to secure safe and
    efficient progress that protects the public, our workers, and the
    environment. We have shown we can deliver meaningful results. Your
    continued support will allow us to deliver results important for today,
    as well as for generations to come.

                             RISK REDUCTION RESULTS

        Recently, we celebrated another success at the completion
    ceremonies for the Fernald, Ashtabula, and Columbus sites. It is the
    latest demonstration of our progress following the earlier completion
    of cleanup at Rocky Flats in Colorado, the Kansas City Plant in
    Missouri, and the Lawrence Livermore National Laboratory--Main Site in
    California. All these completions should be recognized as results that
    have been borne from partnerships founded on mutual respect and
    collaboration.
        EM has also made other significant progress:

             Stabilizing and packaging for disposition all
            plutonium residues, metals, and oxides (SRS and Hanford);
             Producing well over 2,000 cans of vitrified high-level
            waste from radioactive tank liquid wastes;
             Retrieving and packaging for disposal over 2,100
            metric tons of spent nuclear fuel from the K-Basins on the
            Hanford site to protect the Columbia River;
             Characterizing, certifying, and shipping close to
            37,000 cubic meters of TRU waste from numerous sites to WIPP
            for permanent disposal;
             Disposing of more than 965,000 cubic meters of legacy
            low-level waste and mixed low-level waste (contaminated with
            hazardous chemicals); and
             Eliminating 11 out of the 13 high-risk material access
            areas through material consolidation and cleanup.

        In addition, on a site-specific level, we have:

             Completed disposal at WIPP of all legacy drummed TRU
            waste from SRS;
             Completed demolition of the 232-Z facility at Hanford;
             Completed cleanup at the Melton Valley area; and
             Completed the first remote-handled TRU waste shipments
            to the WIPP from INL.

                             SOLVING THE CHALLENGES

        First and foremost, safety is our top priority. We will continue to
    maintain and demand the highest safety performance. We have taken
    measures to fully integrate safety into our project designs at an
    earlier stage while assuring our line project teams have the necessary
    experience, expertise, and training. Safety will remain a cornerstone
    in the execution of our mission objectives.
        We are actively engaged, both within the Department and externally
    with our regulators and stakeholders, in identifying issues that impact
    our mission objectives. We have been challenged by lower than expected
    performance levels, increased scope, and unrealized planning
    assumptions. As we identify issues that could affect future performance
    and regulatory commitments, we are taking significant steps to improve
    our operations in planning and executing our work. We are applying
    lessons learned to help prevent future occurrences that will impact our
    planning and commitments.
        One of my goals as Assistant Secretary is that at least 90 percent
    of our ``projectized'' portfolio will meet or exceed our cost and
    schedule targets. We have begun the process of integrating our
    management tools into our business processes. Over the past year, I
    have personally conducted Quarterly Performance Reviews of all EM
    projects with our leadership team. I report to you that we have showed
    progress, but we have yet to realize the full potential of implementing
    our management systems and better applying risk management principles--
    that is, identifying project uncertainties and developing mitigation
    measures. Some of our projects have fallen short of expected
    performance, but we are engaging our field management contractors with
    state-of-the-practice project management methods.
        Over the last year, it has become apparent that we have not yet
    attained our full potential in our procurements, and in our execution
    of projects. We have instituted measures to strengthen our emphasis on
    program execution. This multi-year objective already is producing
    results that should provide more effective management in the future.
    This initiative is being coupled with additional training for Federal
    managers and staff to enhance project management and acquisition
    skills. This integrated approach will deliver dividends for our
    managers in the long-term.
        We are improving our ability to ensure that proper procurement
    vehicles are available to meet our acquisition strategies. We are
    taking a new look at contract types and fee structures within our
    contracts. EM must acquire the best services including those of small
    business, to meet our business objectives and to become a top-
    performing organization.
        I have asked my senior leadership at Headquarters and in the field
    to take immediate actions to ensure that everyday operating processes
    reflect lessons learned. Lastly, in conjunction with the National
    Academy of Public Administration, EM has undertaken a review of our
    organization and its associated functions and authorities. To date, the
    process has identified areas for improvement, along with some
    refinements of our organizational alignment. During the next few
    months, EM will be implementing the resulting recommendations to ensure
    we have an organizational structure that will enhance our ability to
    respond to the needs of the mission.

                      THE FISCAL YEAR 2008 BUDGET REQUEST

        The Department's fiscal year 2008 budget request for defense EM
    activities totals $5,364 million. The fiscal year 2008 budget request
    reflects safety as its utmost priority. EM is committed to our safety
    principles and to maintaining the highest safety performance to protect
    the workers, the public and the environment.
        The budget request reflects prioritizing program work to balance
    the goals of risk reduction; completing ongoing work to achieve
    completion at sites; and meeting our environmental commitments. For
    fiscal year 2008, EM's funding priorities are listed in order of risk,
    to best address our cleanup challenges:

             Requisite safety, security, and services across EM
            cleanup sites;
             Radioactive tank waste storage, treatment, and
            disposal;
             Spent nuclear fuel storage, receipt, and remediation;
             Other transuranic, low-level, and mixed low-level
            wastes treatment, storage, and disposal;
             Special nuclear materials storage, processing, and
            disposition;
             Soil and groundwater remediation; and
             D&D of contaminated facilities.

        Examples of milestones and planned activities for fiscal year 2008
    by site-specific categories are:
    Hanford
        Richland
             Consolidate, package, and remove spent nuclear fuel
            and other radioactively-contaminated materials within the K
            Basins (K-East and K-West).
              The K Basins project is a high priority, risk reduction
            activity due to its close proximity to the Columbia River. The
            goal of this project is removal of all spent nuclear fuel,
            radioactive sludge, contaminated K Basin water, and radioactive
            debris from the K Basins. The endpoint of the K Basins cleanup
            will mean the removal of more than 55 million curies of
            radioactivity that pose a threat of leakage to the surrounding
            environment, including the Columbia River.
             Amplify River Corridor remediation activities for
            Reactor Areas D, F, and H.
              The River Corridor Closure Project will complete remediation
            of contaminated waste sites; the D&D and demolition of
            facilities that are adjacent to the Columbia River; and
            placement of eight reactors into an interim safe storage
            condition. The work performed within the River Corridor Closure
            Project includes digging up contaminated soil, constructing
            interim safe storage (cocooning) of the reactors, demolishing
            facilities in the old reactor complexes and facilities in the
            300 Area, disposing of waste in the Environmental Restoration
            Disposal Facility, and constructing surface barriers or caps
            over contaminated sites.
             Continue retrieval of contact-handled suspect
            transuranic waste and scheduled shipments to WIPP.
              The Hanford Site contains thousands of containers of suspect
            transuranic waste, low-level, and mixed low-level wastes. The
            end point of this project will include the retrieval of
            contact-handled suspect transuranic waste in the low-level
            burial grounds, the treatment of mixed low-level waste, the
            disposal of low-level waste, and certification and shipment of
            transuranic waste to WIPP.
             Continues groundwater/vadose zone remediation activities.
              Due to 40 years of weapon production processes, Hanford's
            groundwater has been contaminated with carbon tetrachloride,
            chromium, technetium-99, strontium, and uranium plumes. EM is
            dedicated to preventing the potential for contaminates reaching
            the groundwater by: decommissioning an additional 100 unused
            groundwater wells; monitoring 700-plus wells for contaminants
            of concern above drinking water standards; and, commencing
            design of final remediation actions to address carbon
            tetrachloride and technetium plumes.
    Office of River Protection
             Sustain tank farm closure processes and maintain the
            tanks in a safe and compliant condition.
              The radioactive waste stored in Hanford tank farms has been
            accumulating since 1944. Due to the age of the tanks, a number
            have leaked in the past into surrounding soil and groundwater.
            In order to reduce the risk of future tank leaks into the
            environment, the overall objectives of this project include the
            stabilization of radioactive waste stored underground in tanks,
            including retrieval, treatment, disposal, and closure of the
            facilities.
             Progress on path forward for the Waste Treatment and
            Immobilization Plant.
              The Waste Treatment and Immobilization Plant (WTP) is
            critical to the completion of the Hanford tank waste program by
            providing the primary facility to immobilize (vitrify) the
            radioactive tank waste at the Hanford Site. The WTP complex
            includes five facilities: the Pretreatment Facility, the High-
            Level Waste Facility, the Low-Activity Waste Facility, the
            Balance of Facilities, and the Analytical Laboratory. In fiscal
            year 2008, the WTP project team plans to complete: close-in of
            the Annex building in the Low-Activity Waste Facility;
            installation of roofing and completion of the building shell
            for the Analytical Laboratory; construction of the water
            treatment building in the Balance of Facilities; and renewal of
            construction for the High-Level Waste Facility and the
            Pretreatment Facility.
    Idaho
             Transfer spent nuclear fuel from wet to secure dry
            storage.
              Promote the safe and secure receipt, dry storage, and
            packaging and future transfer of the spent nuclear fuel to a
            Federal geologic repository at Yucca Mountain.
             Continue shipments of transuranic waste to the WIPP.
              Maintain program activities that support waste
            characterization, packaging, and transportation of remote-
            handled transuranic waste to WIPP that lead to reduced
            surveillance and operation costs.
             Pursue ongoing sodium-bearing waste treatment facility
            construction, including efforts to gain necessary regulatory
            approvals for sodium bearing waste treatment and disposal.
              The overall objective of this project is treatment and
            disposal of the sodium-bearing tank wastes, closure of the tank
            farm tanks, and performance of initial tank soils remediation
            work. Construction and operation of the sodium-bearing waste
            facility will reduce potential risk to human health and the
            environment by preventing the potential migration of
            contamination into the Snake River Plain Aquifer, which is a
            sole-source aquifer for the people of Southeastern Idaho.
    LANL
             Characterize, certify, and ship above-grade
            transuranic waste inventory.
              The Solid Waste Stabilization and Disposition Project
            includes the treatment, storage, and disposal of legacy
            transuranic and mixed low-level waste generated between 1970
            and 1999 at LANL. Final disposal of the legacy transuranic
            waste from LANL will reduce risk to workers, as well as reduce
            security costs associated with transuranic waste.
             Promote soil and water remediation and monitoring.
              The LANL Soil and Water Remediation Project's objective is to
            identify, investigate and remediate, when necessary, areas with
            chemical or radiological contamination attributable to past
            Laboratory operations.
              In fiscal year 2008, in order to fulfill the objective of
            protecting and monitoring the regional aquifer, as well as
            long-term surveillance and monitoring to provide necessary
            safeguards and protection for surface and ground waters, the
            following activities are planned:

                     Perform groundwater monitoring at all major
                    watersheds: LA/Pueblo; Mortandad; Canon de Valle;
                    Sandia; and in close proximity to the major waste
                    sites;
                     Conduct stormwater sampling and implement
                    erosion control measures;
                     Install and monitor four wells in Pajarito and
                    Bayo canyons; and
                     Complete construction of 260 Outfall
                    Corrective Measures for alluvial and surface water
                    treatment system.
    Oak Ridge
             Continue design of U-233 down-blending project and
            begin Building 3019 modifications
              Down-blending the Building 3019 inventory for disposition is
            in accordance with the national nonproliferation goals by
            making the U-233 material unsuitable for use in weapons and
            reducing security costs at the Oak Ridge National Laboratory.
             Ship contact-handled transuranic waste to WIPP.
              Process 250 cubic meters of contact-handled transuranic
            debris and 170 cubic meters of remote-handled transuranic
            debris with shipments to the WIPP; and continue to dispose of
            low-level/mixed low-level waste at the NTS.
             Complete the Molten Salt Reactor Experiment fuel salt
            removal remediation project.
              Upon completion of active remediation, surveillance and
            maintenance activities of the Molten Salt Reactor Experiment
            facility will be provided until decontamination and
            decommissioning of the site has occurred.
    Savannah River Site
             Consolidate on-site Plutonium to K Area.
              In order to meet the Department's Design Basis Threat
            criteria, plutonium at SRS is being consolidated into one
            Category 1 Special Nuclear Materials Storage Facility. The
            receipt, storage, and disposition of these special nuclear
            materials at the SRS allows for deinventory and shutdown of
            other DOE complex sites, while providing substantial risk
            reduction and significant mortgage reduction savings to the
            Department.
             Ship all legacy transuranic waste to WIPP and treat
            low-level waste and mixed low-level waste.
              In fiscal year 2008, SRS plans to dispose of transuranic
            waste previously characterized as mixed low-level waste;
            dispose of low-level waste and newly generated waste, including
            soil, groundwater and decontamination and decommissioning
            wastes; dispose of mixed low-level waste inventory and newly
            generated waste; and dispose of hazardous waste inventories,
            thus reducing potential exposure to project workers.
              The end-state for this project is the shipment of all legacy
            transuranic waste to the WIPP, the treatment of PUREX waste,
            and the elimination of all legacy inventories and disposition
            of newly generated low-level waste, mixed low-level waste, and
            hazardous waste.
             Continue groundwater corrective actions across the
            Site.
              SRS is working to prevent the spread of contamination into
            adjoining groundwater aquifers and nearby surface waters.
            Existing contamination in vadose zones, groundwater and surface
            water sediments are currently being cleaned up, thereby
            reducing the risk to site workers, the public and the
            environment.
             Treat, stabilize, and dispose legacy radioactive waste
            stored in underground storage tanks.
              The continuation of the design and construction of the Salt
            Waste Processing Facility will aid the Defense Waste Processing
            Facility in the process of safely disposing of the liquid tank
            wastes. The Salt Waste Processing Facility will separate the
            high-activity fraction from the low-activity fraction of the
            salt waste stored in the underground tanks at the SRS. The
            completion of the Salt Waste Processing Facility will support
            the mission of SRS in meeting its Federal Facilities Agreement
            commitments for waste tank disposition.
    WIPP
             Operate the WIPP in a safe manner to support disposal
            capabilities for transuranic waste.
              The WIPP in Carlsbad, New Mexico, is the Nation's only mined
            geologic repository for the permanent disposal of defense-
            generated transuranic waste. All of the defense-generated
            transuranic waste from eligible generator sites must come to
            WIPP for receipt, handling, and disposal.

                                   CONCLUSION

        The fiscal year 2008 budget request enables risk reduction to
    continue. Challenges lie ahead but we are focused on our objectives and
    our strategy. Safety, performance, cleanup, and closure underpin our
    actions and initiatives. We are committed to work with all interested
    parties to resolve issues. We look forward to continuing to work with
    this subcommittee and Congress to address your concerns and interests.
    Our success relies on our effective partnerships with our regulators,
    the communities, and our contractors to produce progress in
    accomplishing meaningful results for the American public.
        I look forward to a continuing dialog with you and the
    subcommittee. This concludes my formal statement for the record. I will
    be pleased to answer any questions at this time.

        Senator Bill Nelson. Let me just ask you. You have been
    reviewing the earned value management system and the Defense
    Contract Management Agency (DCMA) has changed its valuation
    methods, so there is a new approach. Now, if this new approach
    were to be applied to the waste treatment project then there
    would be another delay. So can you explain what is the problem
    and is there a way to resolve the situation with the DCMA?
        Mr. Rispoli. Yes, Mr. Chairman. I have visited with the
    director of the DCMA and your information that they have
    changed their approach is, in fact, true. They have essentially
    ratcheted up their interpretation of how to implement the
    American National Standards Institute criteria. There are 32
    criteria for earned value management systems.
        The DOD has ratcheted up, to their credit, the way they
    interpret that those criteria should be established, and their
    approach is geared more towards a weapons system, like an
    airplane or a ship. They do not do a lot of reviews of
    construction projects. In fact, when we asked them to give us
    an example of another construction project that met their
    expectation, they could give us no example.
        I should back up a moment. This committee sponsored
    language last year in statute that requires the DCMA to certify
    our earned value management system. We are still working toward
    that end. Meanwhile, the Department has brought in another
    contractor separate from EM, separate from my organization that
    does this as part of their business, reviews earned value
    management systems.
        In fact, they have been recognized, this company has been
    recognized, by the Defense Department as being preeminent in
    their field. I can share that with you after the hearing if you
    would like, the web site that shows that.
        We are using that company to give us an independent look at
    the earned value management system at the project. They are out
    there this week, in fact. They have been there all week for
    their second visit.
        So we are taking, you might say, a dual track approach. One
    is to continue to work with the DCMA to see if we can satisfy
    their concerns about the way they interpret the criteria,
    meanwhile going to this other company that is also recognized
    by the Defense Department as a preeminent expert in the area to
    see what they think about our earned value management system.
        The earned value management system is one of several
    project management tools that we rely on to gauge the success
    and the health of a project as it goes forward. That is why
    this is an important element of what we look at, the earned
    value management system.
        Senator Bill Nelson. What is the name of that company?
        Mr. Rispoli. The name of that company is Tecolote. They are
    based in Santa Barbara, California, and, as I indicate, they
    are one of the preeminent companies identified by the
    Department of Defense (DOD) as being expert in their field.
        Senator Bill Nelson. The DCMA was close to completing its
    review of the Bechtel earned valve management (EVM) system when
    it changed its approach. The current law requires them to make
    a recommendation to the Secretary on the EVM system. In the
    absence of the DCMA, would you have some outside review of the
    EVM system?
        Mr. Rispoli. Our intent, Mr. Chairman, is to keep your
    staff apprised of the progress of our activities with both the
    DCMA and this company called Tecolote, and as we go forward
    you, this committee through your staff, will know how we are
    doing on both fronts, both with the DCMA and with Tecolote. Of
    course, it would be within your purview to change the
    requirement that there be independent certification, without
    that certification necessarily being the DCMA.
        I can assure you that we want the same thing. We want
    assurance that the system that we are using and relying on is
    legitimate. So by bringing in Tecolote--the Department chose
    them, not my organization. But they are a recognized front-
    runner in this field, and again I can share that information
    with your staff.
        Senator Bill Nelson. Jeff, you jump in.
        Senator Sessions. The waste treatment plant, the design has
    been approved and the contract is in the course of being
    executed, is that correct?
        Mr. Rispoli. Yes, sir, that is true.
        Senator Sessions. You have an extra $3 billion contingency
    money there?
        Mr. Rispoli. Yes, sir, that is correct.
        Senator Sessions. Well, my experience is if the contract is
    everybody thinks there is a $3 billion contingency there, some
    of it might get used. Are you confident that you are going to
    do everything possible to preserve every penny of that $3
    billion?
        Mr. Rispoli. Senator Sessions, our intent is, we are in the
    midst now of renegotiating that contract. The Government is
    preparing its position and our intent is to provide strong
    incentives. You, I am sure, are aware of the Rocky Flats
    contract, where we delivered 14 months early and quite a bit
    below the Government's estimate. We would use the same lessons
    learned as we negotiate this contract to provide a very strong
    incentive for the contractor to deliver both early and under
    budget. So that would be our intent.
        I would also point out that if you take away the $3 billion
    in contingency from the $12.2 billion, the actual hard cost
    estimate this time is based upon nearly 80 percent design. So
    the estimate was, for the most part, a bottoms-up cost
    estimate. It took the Army Corps of Engineers a year to review
    the contractor's cost estimate with 30 people on site. It is a
    huge project.
        So we have a great degree of confidence that the estimate
    this time is much more sound than it was years ago when the
    estimate was based upon very immature engineering. This time,
    as I say, we are nearly 80 percent designed and the project has
    gone through an intense review by the Army Corps.
        Senator Sessions. That part of it is sort of a done deal. I
    mean, that contract is let and it is going forward. Then the
    additional cost will come as the waste liquid is brought in and
    processed, is that right?
        Mr. Rispoli. Yes, sir.
        Senator Sessions. Let me just say, I remember in Alabama at
    the Anniston Army Depot, when we went through the destruction
    of poison gas. There were serious differences of opinion. There
    was a chemical reaction where it could be poured, a chemical
    could be poured over, and this was supposed to neutralize the
    gas, or burning, and we went through that. I am not sure how
    smart we were, but it was all discussed.
        Have there been any other suggestions? Has any effort been
    made to ascertain if some other sharp person could develop a
    different way of handling this waste, rather than something
    that is going to cost us $173 billion, to be sure that all the
    other options--when you talk about that big a commitment, I
    think it is incumbent on us to ask ourselves rigorously, is
    there any other option to this.
        Mr. Rispoli. The answer to that is, I believe, Senator
    Sessions, that when the choice was made to go with this
    vitrification process for both the high level and the low
    activity waste, there was a very significant scrub, if you
    will, of what options were available. I have been in this
    position since August 2005 and I have heard of no suggestion
    that any other technology would work better.
        The reason is that we have experience with vitrification
    both at West Valley, New York, where we built a plant, operated
    it, and then closed it down because it finished its job on a
    much smaller scale, and the one in Savannah River in South
    Carolina is still operating reliably after a number of years,
    at least 5 that I am aware of.
        So we are confident that the technology is proven and
    reliable and that we can use it to process the waste.
        Senator Sessions. It is proven and reliable, I do not
    dispute. But it is expensive. What about the effort in Savannah
    River? Senator Graham is a member of this committee. He was
    very pleased. As I recall, South Carolina worked with the DOE
    and a plan was developed that was substantially less expensive
    than some of the earlier estimates. Are you aware of that
    history?
        Mr. Rispoli. Yes, sir.
        Senator Sessions. How much difference did it turn out to
    be? I have forgotten how much it saved. Do you know how many
    billion dollars less it turned out to be?
        Mr. Rispoli. I do not know how much that initial
    vitrification plant cost. As I indicated, it has been operating
    for a number of years. But that vitrification plant in South
    Carolina will only handle 3 million out of 37 million gallons
    of waste at that site. So there is other construction in design
    today, not yet built, that has already been presented to
    Congress and it is well known as an upcoming project, to build
    what I would call the balance of the plant needed, to kind of
    duplicate what is at Hanford. But because it is a much smaller
    number of gallons to go through it, the plant will be smaller
    and it does not have to be sized as big or as robust.
        Senator Sessions. Well, let us just pursue that. Are you
    saying that the net cost per gallon of product processed is
    going to be equal in South Carolina to the Hanford site?
        Mr. Rispoli. I do not know the net cost per unit. I can get
    that to you. I could take that question.
        [The information referred to follows:]

        The cost per unit is reflected on the chart on page 279.

        Senator Sessions. In addition to that, of course, just
    processing the liquid, then you have to do things, you have to
    consider what to do about the site itself, correct?
        Mr. Rispoli. Yes, sir.
        Senator Sessions. Can you give us an estimate of how much
    goes into processing the liquid and how much would be in
    processing and cleaning up the site, as planned in this
    project?
        Mr. Rispoli. At Hanford, after the plant is built and fully
    operational, which is in around the 2019 timeframe, we are
    envisioning operating all the way into the 2030s with that
    plant. So it will be many years of operation of that plant to
    process the waste out of the 177 tanks.
        Now, we are already taking waste and concentrating it so
    that we can try to get some tanks, the higher risk tanks,
    empty----
        Senator Sessions. Is there a cost figure on that processing
    the liquid waste and then a cost figure on cleanup of the site
    in addition? Are there additional funds to be spent on that?
        Mr. Rispoli. Yes, there is. But again, I would have to get
    that to you for the record. You mean the life cycle cost to
    clean up the Hanford site. Senator, I will get you that for the
    record.
        [The information referred to follows:]

                      Life Cycle Cost to Clean Up Hanford

        The life-cycle cost estimate for processing the 53 million gallons
    of high level waste at Hanford is $56.5 billion which includes
    construction of the Waste Treatment Plant ($12.3 billion) and tank
    waste retrieval, treatment operations, storage of the high-level waste
    canisters, onsite disposal of the low activity waste canisters,
    decommissioning and decontamination of the Waste Treatment Plant, and
    closure of the 177 high level waste tanks ($44.2 billion *).
    The life-cycle cost includes costs beginning in 1997 through 2042. From
    1997 through 2007 the Department has expended $8.6 billion; $4.8
    billion for the Waste Treatment Plant construction and $3.8 billion for
    tank farm operations and infrastructure improvements, demonstration of
    tank waste retrieval systems, and construction of a high-level waste
    canister storage facility. The cost to complete the remaining work
    includes $7.4 billion to complete construction of the Waste Treatment
    Plant; $10.4 billion for waste processing; $25.5 billion for tank farm
    operations, waste retrieval, high-level waste canister storage, and low
    activity waste disposal; $1.1 for decommissioning and decontamination
    of the Waste Treatment Plant; and $3.4 billion for closure of the 177
    high level waste tanks.
    ---------------------------------------------------------------------------
        \*\ The Deputy Secretary of Energy approved an increase in the
    life-cycle cost from $26.2 billion to $44.2 billion for this project
    baseline summary, ORP-0014 Tank Farm Operations, subsequent to the
    submittal of the fiscal year 2008 Congressional Budget Request.
    ---------------------------------------------------------------------------
        The life-cycle cost estimate for cleaning up the remaining portion
    of the Hanford reservation is $29.6 billion which includes $12.5
    billion for nuclear facility decontamination and demolition, $11.8
    billion for nuclear material, spent nuclear fuel and solid waste
    stabilization, $2.1 billion for soil and ground water remediation, $2.3
    billion for safeguards and security, and $0.9 billion for other support
    activities. $8.8 billion has been expended on these activities through
    2007.
        A table summarizing the life-cycle cost for each portion of the
    Hanford Site cleanup is provided below.

        Senator Sessions. Could you explain to me what Senator
    Lindsey Graham meant last year when he said that South Carolina
    worked with the DOE and they agreed on a cleanup method that
    saved a considerable sum of money? What was he talking about?
        Mr. Rispoli. I presume that he was talking about the
    project that is now under construction, that will enable us to
    take the remaining low-activity waste and dispose of it on
    site. This committee itself was the instrumental committee in
    the 2005 National Defense Authorization Act that gave us
    authority for the Secretary to make a waste determination to
    leave low activity waste on site. That determination is called
    section 3116 of the 2005 National Defense Authorization Act and
    it applies to South Carolina and to Idaho.
        So what this committee did, and Senator Graham was one of
    those instrumental in it, was give us the authority for the
    Secretary to make a determination, in consultation with the
    NRC, that we could leave the low activity waste on site in
    South Carolina.
        Senator Sessions. Is that planned in Hanford?
        Mr. Rispoli. The current plan at Hanford is that we will
    leave the low activity waste on site, yes, sir.
        Senator Sessions. In the same fashion?
        Mr. Rispoli. It will be vitrified, but it will be on site,
    yes, sir.
        Senator Sessions. Is that the same fashion as South
    Carolina did it?
        Mr. Rispoli. The waste form is different in that. It is
    going to be a grout waste form in South Carolina and a glass
    waste form in Hanford. But it is the same outcome in that we
    are leaving low----
        Senator Sessions. Is that a factor in the different cost?
        Mr. Rispoli. I will get that for you, and I will reduce it
    to per unit so that you can see per unit.
        [The information referred to follows:]

        The cost per unit is reflected on the chart on page 279.

        Senator Sessions. I would just say to you, $173 billion is
    almost what it costs to fight the Iraq war for 2 years. It is a
    lot of money.
        Senator Bill Nelson. Let me ask about Savannah River. So
    are you saying there are plans for moving materials outside of
    Idaho or South Carolina?
        Mr. Rispoli. The statute that was originated with this
    committee enables us to leave--to make a determination to leave
    low activity waste on site. At Savannah River site, that low
    activity waste determination that we have already made would
    actually put it into on-site vaults in a grout form. In the
    future we would expect to be using that authority to also grout
    the empty tanks, which is the same intent at Hanford, that we
    would grout the empty tanks once they are emptied.
        So the overall approach is very similar. The difference is,
    and you picked up on this, is that the low activity waste at
    Hanford will be vitrified. The low activity waste at Savannah
    River will be put into a saltstone form, which is a grout, and
    into vaults. But yes, the answer is the low activity waste will
    be left on site in both. That is the intent. The intent also is
    that the tanks once emptied would be grouted to protect the
    public and the environment, so that the tanks are one
    monolithic entity from that point forward.
        Senator Bill Nelson. The high activity waste eventually
    would be encased in glass and sent to----
        Mr. Rispoli. Yucca Mountain.
        Senator Bill Nelson. --Yucca?
        Mr. Rispoli. Yes, Mr. Chairman. At all three--at West
    Valley, New York, at the Savannah River site, and also at
    Hanford.
        Senator Bill Nelson. You just need Congressional
    authorization to send it to Hanford?
        Mr. Rispoli. Actually, we are okay. We meet all of the
    acceptance criteria for sending the waste to Yucca. Yucca in
    its present legal limit of how much it can accept already can
    accept all the waste from the Savannah River site. In its
    present legal limit, not physical limit, it would not be able
    to accept all the waste from the Hanford site. Physically, it
    could, but there is a legal cap on how much could go to the
    Yucca Mountain site.
        Senator Bill Nelson. Do not worry, Mr. Podonsky; we are
    getting to you.
        Mr. Podonsky. I am waiting patiently.
        Senator Bill Nelson. Well, on this consolidation of the
    materials, tell us what is the status of the effort to complete
    the nuclear materials consolidation study?
        Mr. Rispoli. Yes, Mr. Chairman. In 2005 the Department
    established an across-the-Department committee, you might say a
    crosscutting committee, to look at for all elements that have
    nuclear materials, such as plutonium, what could be done to
    consolidate that material. The committee has basically
    presented an approach that would in fact consolidate all of
    that special nuclear material, most of it, to the Savannah
    River site, with the intent of actually running it through a
    disposition process at the Savannah River site, such that it
    could either go through the MOX plant, which would make it
    usable as a nuclear reactor fuel, or disposition it in some
    other way.
        So we have already announced what the intent would be. Now,
    there is more work to be done; we would have to still finish
    all of the other requirements, such as the National
    Environmental Policy Act--but the intent would be that the
    special nuclear materials at Hanford, for example, would be
    taken out of Hanford, which would save the Department an
    enormous amount of money, both initial capital construction to
    enhance the security, to meet the required security parameters,
    as well as the extra guns and guards that would have to
    continue to protect that material at Hanford if we did not move
    it.
        So from our programmatic perspective, we are very eager to
    implement this consolidation approach, to get that special
    nuclear material out of Hanford, to save the money at that
    site.
        Senator Bill Nelson. That is plutonium 239?
        Mr. Rispoli. Yes, sir, all plutonium and also some uranium
    materials.
        Senator Bill Nelson. When will that material be shipped
    from Hanford?
        Mr. Rispoli. It would all hinge on the final approval of
    the overall plan, because there is another Federal statute that
    basically provides that until the Department can demonstrate a
    disposition path for all the plutonium that would go into South
    Carolina, we cannot bring the material into South Carolina.
    Right now we are awaiting the ability to begin construction at
    the MOX plant, which is not in my program. It is in the Nuclear
    Nonproliferation side of the house. We would then be able to
    demonstrate the ability to disposition all this material.
        I might mention that only today, a report was delivered to
    the appropriate committees here in Congress, including yours, a
    business case analysis that shows the approach for
    dispositioning this material at the Savannah River site. I do
    not think you would have had a chance to, or your staff, to
    digest it, but I have a copy that I could leave if your staff
    would like it after the hearing.
        Senator Bill Nelson. Mr. Podonsky, is that going to be
    safe, to move it from Harford to Savannah River?

       STATEMENT OF GLENN S. PODONSKY, CHIEF HEALTH, SAFETY, AND
                 SECURITY OFFICER, DEPARTMENT OF ENERGY

        Mr. Podonsky. We would be happy to inspect Mr. Rispoli's
    activities to let you know whether they are safe or not. But
    that is part of what we do, independently assess the
    performance of the Department in a number of areas.
        If I might, Mr. Chairman----
        Senator Bill Nelson. Yes, please.
        Mr. Podonsky. --I would like to first, of course, thank
    you, Mr. Chairman and Senator Sessions, for inviting me to
    testify.
        I think it is important to just take a moment, if you will
    allow me, to talk about the Health, Safety, and Security
    Office. It was just created 7 months ago by Secretary Bodman to
    incorporate a new way of doing management within the
    Department, especially in the two biggest areas of what we call
    the mortgage payment of the Department, safety and security.
        Within my office, we are responsible for establishing the
    policy for the entire Department for environment, safety,
    health, and security including the National Nuclear Security
    Administration (NNSA). We also do independent oversight,
    independent of the line. So in other words, we inspect Mr.
    Rispoli as well as all the other assistant secretaries that
    have facilities in the Department. We inspect them for their
    performance with the standards and requirements from the
    Department in all the areas of environment, safety, health,
    safeguards, security, cybersecurity, and emergency management.
        Our office is also responsible for technical assistance to
    the field in areas where they are having difficulties in all of
    the areas I just mentioned, as well as we have the Office of
    Classification. We also are responsible for training. We have a
    training center out in Albuquerque that does the professional
    training for safety and security professionals.
        The other part that we also have, which is very important,
    is the enforcement function, which enforces the civil penalties
    for DOE Orders 824, which is on security, the worker health and
    safety rule, 851, and also the Price-Anderson, nuclear safety
    rule, which is 820.
        So part of our responsibilities for the Secretary is
    evaluating the performance of the Department in all of those
    areas. So when you ask the question, will it be safe to move
    from one facility to another, we would look at what the program
    offices plan to do and then we would actually inspect them
    against their plans. The way we inspect them is we actually
    bring in trained adversaries that are comparable to Delta
    Force, Navy SEALs, for our environment, and make sure that they
    can in fact fend off any attempt to steal the nuclear material
    or to divert it or any number of issues that we want to test.
        Again, we test them against what they say they can do and
    we test them against the performance of the requirements that
    they are supposed to perform to.
        [The prepared statement of Mr. Podonsky follows:]

                    Prepared Statement by Glenn S. Podonsky

                                  INTRODUCTION

        Chairman Nelson, Ranking Member Sessions, and members of the
    subcommittee, thank you for inviting me to testify today on the
    Department of Energy's fiscal year 2008 budget request for the Office
    of Health, Safety and Security (HSS). On October 1, 2006, the Secretary
    of Energy established HSS to integrate certain Department of Energy
    (DOE) Headquarters-level functions for health, safety, environment, and
    security into one unified office. This new organization reflects the
    Department's commitment to maintain a safe and secure work environment
    for all Federal and contractor employees and the surrounding
    communities and stresses the importance of delineating clear roles and
    responsibilities and line management accountability for these programs.
    Since its creation, this new office has begun the process of
    strengthening these important functions through increased clarity in
    the assignment of responsibilities and accountability. The fiscal year
    2008 HSS budget request includes the funding of the former Environment,
    Safety, and Health (EH) program within the Energy Supply and
    Conservation and Other Defense Activities appropriations, and the
    funding of the former Security and Safety Performance Assurance (SSA)
    program within the Other Defense Activities appropriation. The HSS
    program provides a highly focused and integrated corporate-level
    analytical capability to identify problem areas and to provide the
    basis for line management to implement effective Department-wide
    solutions in the areas of health, safety, environment, and security.
        As the Department's central organization responsible for health,
    safety, environment, and security, HSS provides corporate-level
    leadership and strategic vision to coordinate and integrate these
    programs. It provides the Department with effective and consistent
    policy development, technical assistance, education and training,
    complex-wide independent oversight, and enforcement for health, safety,
    environment, and security programs. HSS integrates worker health,
    safety, environment, and security functions to address crosscutting
    Departmental issues, increase collaboration and sharing of technical
    expertise, and increase management accountability for health, safety,
    environment, and security responsibilities. This integrated approach
    and functional alignment of responsibilities reduces overlap in
    reporting and provides consistency in developing policy and guidance
    and providing technical assistance, while increasing the effectiveness
    of communication and accountability for worker health, safety,
    environment and security. As the Chief Health, Safety, and Security
    Officer, I advise the Deputy Secretary and the Secretary on a wide
    range of matters related to health, safety, environment, and security
    across the complex.
        Before addressing the HSS budget request and priorities, we want to
    make clear that one of the primary objectives in creating HSS was to
    build upon the dedicated efforts, and positive impact made by the
    previous EH and SSA organizations and to continue their work in a more
    integrated and effective manner to further strengthen these important
    functions. For example, the HSS Office of Independent Oversight
    continues to have a rigorous and multi-faceted oversight program. At
    the time of the recent security problems at Los Alamos National
    Laboratory (LANL), HSS was conducting a combined safeguards and
    security, cybersecurity, and emergency management independent oversight
    inspection at LANL. Subsequent to that inspection, HSS conducted a
    Personnel Security Follow-up Review of the NNSA Service Center
    Personnel Security Program that included an extensive review of all
    case files for the timeframe of interest. Additionally, as directed by
    the Secretary of Energy, HSS led a task force to review the
    Department's Personnel Security Program to determine whether there are
    deficiencies in the program or program implementation throughout the
    Department. Further, in November 2006, HSS initiated a security
    enforcement investigation under the provisions of 10 CFR 824
    (Procedural Rules for the Assessment of Civil Penalties for Classified
    Information Security Violations) into the recent LANL security event,
    the first such investigation undertaken by the Department.
        The Secretary of Energy is ultimately responsible and accountable
    for the performance of DOE, including NNSA. Through HSS, the Secretary
    establishes Department-wide environment, safety, health, and security
    policy, which also applies to NNSA. The Secretary relies on HSS to
    conduct corporate independent oversight of all safety and security
    disciplines, and expects NNSA to respond to all findings with effective
    corrective actions to eliminate weaknesses. As a result, it is
    imperative for HSS to maintain a close working relationship with NNSA.
    The roles of certain elements within NNSA, such as the Office of
    Defense Nuclear Security, are complementary to HSS in providing policy,
    assistance, training, and oversight. The role of the Office of Defense
    Nuclear Security is to provide a line management oversight function by
    advising the Administrator, NNSA, on the status of security within
    NNSA.

                    FISCAL YEAR 2008 BUDGET REQUEST OVERVIEW

        The Office of HSS's budget request for fiscal year 2008 of $428.358
    million includes $328.315 million for HSS Programs and $100.043 million
    for Program Direction. A summary of the HSS programs and activities
    proposed to continue in fiscal year 2008 with this funding request
    include:
    Health and Safety Policy, Standards, and Guidance ($4,203,000)
        DOE issues policy, standards, and guidance to ensure workers and
    the public, property, and the environment are adequately protected from
    the hazards of DOE activities. For most DOE facilities, DOE assumes
    direct regulatory and enforcement authority for safety and health in
    accordance with the Atomic Energy Act of 1954, as amended. Safety
    policy, standards, and guidance must therefore take into account the
    nuclear, chemical, and industrial hazards posed by DOE operations and
    must be current with worldwide technologies, knowledge and experience.
    Environmental programs at DOE sites are, for the most part, driven by
    Federal, State, and local regulations. However, environmental direction
    and assistance are provided to DOE sites, especially in the areas of
    pollution prevention and Environmental Management Systems development
    and implementation. The fiscal year 2008 budget request provides for
    HSS to:

             Strengthen implementation of 10 CFR 851, Worker Safety
            and Health Program
             Continue to support training for Nuclear Executive
            Leadership, Senior Technical Safety Managers, and Environment,
            Safety and Health Project Managers
             Strengthen worker health and safety, nuclear safety,
            radiation protection, and environmental policies and standards,
            including Integrated Safety Management and Environmental
            Management Systems
             Continue implementation of the Federal Employee
            Occupational Safety and Health program via training, guidance,
            and other communications methods
             Strengthen liaison with the Institute of Nuclear Power
            Operations and the commercial nuclear power industry
             Provide support to the U.S. and international
            regulatory community by maintaining standards associated with
            the release of contaminated property and response to events
            involving radiological dispersal and improvised nuclear devices
             Continue to assist DOE sites to implement
            Environmental Management Systems and the DOE Environmental
            Compliance Management Improvement Plan
             Continue implementation of the Human Performance
            Improvement Initiative to identify and close human performance
            gaps
             Develop and issue the DOE Annual Site Environmental
            and National Environmental Standards for Hazardous Air
            Pollutants Reports
             Conduct and support cultural resource and
            environmental protection program workshops, lessons-learned
            programs and guidance and tools, including those related to
            implementation of environmental management systems requirements
            under the new Executive Order 13423 (Strengthening Federal
            Environmental, Energy, and Transportation Management) as well
            as those for continued compliance with environmental laws

    DOE-Wide Environment, Safety, and Health Programs ($3,976,000)
        DOE-Wide Environment, Safety, and Health Programs improve worker
    and nuclear facility safety, and protect the public and the
    environment. Activities under these programs develop state-of-the-art
    analysis tools and approaches specific to the nature and mix of
    radioactive, hazardous, and toxic materials at DOE facilities. Efforts
    include construction safety; work planning activities and techniques to
    identify, evaluate, and eliminate hazards; methods for reducing or
    eliminating release of pollutants; and the identification of
    technologies and innovative adaptations of existing practices. The
    fiscal year 2008 budget request provides for HSS to:

             Continue providing assurance that worker radiation
            exposures are accurately determined through the DOE Laboratory
            Accreditation Program
             Prepare the Annual DOE Occupational Radiation Exposure
            Report
             Continue to promote pollution prevention through DOE
            Pollution Prevention (P2) Star Awards and improve pollution
            prevention data reporting and analysis
             Assist sites in maintaining safe operations throughout
            the life-cycle of their nuclear facilities
             Strengthen and expand the implementation of the DOE
            Voluntary Protection Program (VPP), including continued
            development of the electronic VPP
             Assist in the implementation of Environmental
            Management Systems and provide Status Report to the U.S.
            Environmental Protection Agency
             Strengthen the implementation of the Enforcement
            Program Plan to integrate enforcement protocols for both
            nuclear and worker safety and health
             Improve the Noncompliance Tracking System to
            strengthen report generation and address feedback received from
            end users
             Continue the enforcement of 10 CFR 851, Worker Safety
            and Health Program
             Update 10 CFR 850, Chronic Beryllium Disease
            Prevention Program to reflect lessons learned and advances in
            technology since its promulgation in 1999
    Corporate Safety Programs ($7,111,000 less $990,000 from prior year
            balance for a fiscal year 2008 request of $6,121,000)
        Corporate Safety Programs serve a crosscutting safety function for
    the Department and its stakeholders in assuring excellence and
    continuous improvement in environment, safety and health in the conduct
    of its missions and activities. Elements that comprise Corporate Safety
    Programs include: Performance Assessment, the Quality Assurance Program
    (which includes the Corrective Action Management Program), Filter Test
    Facility, the Facility Safety Program (which includes Accident
    Investigations and Corporate Safety Basis), Price-Anderson Enforcement,
    and the Analytical Services Program. The fiscal year 2008 budget
    request provides for HSS to:

             Strengthen trending and analysis of DOE's safety
            performance in protecting the public, workers, and the
            environment through advanced analytical tools
             Analyze the effectiveness of site suspect or
            counterfeit items programs and prepare the DOE Annual Suspect
            or Counterfeit Items Activities Report
             Continue to improve the safety-related DOE Quality
            Assurance Program through updated directives, assessments,
            technical assistance, and maintenance of the Corrective Action
            Management Program
             Operate and maintain the High Efficiency Particulate
            Air Filter Test Facility
             Support and conduct Type A investigations for serious
            incidents and oversee the conduct of Type B investigations via
            the Accident Investigation Program
             Participate in Operational Readiness Reviews and
            Readiness Assessments, and associated program training, at
            Category 1, 2, and 3 nuclear facilities prior to the startup or
            restart of those facilities
             Continue implementation of the Nuclear Safety
            Enforcement Program in accordance with the Price-Anderson
            Amendments Act
             Implement the Analytical Services Program by
            developing corporate-level environmental sampling protocols and
            conducting quality assurance audits of environmental
            laboratories used by the sites in support of environmental
            compliance programs

    Health Programs ($40,803,000)
        Health Programs support domestic and international health studies
    including the Former Worker Program (a nationwide program of medical
    screening to identify work related health effects) and studies to
    investigate and identify work related injury and illness in the DOE
    worker population and populations surrounding DOE sites. The benefits
    of these projects and programs include discovery and documenting health
    effects outcomes that provide the scientific basis for national and
    international worker protection policy and standards. These radiation
    protection standards and practices, in turn, provide levels of
    protection appropriate for the risk posed to workers by hazards present
    at DOE sites. The fiscal year 2008 budget request provides for HSS to:

             Continue to conduct international health and
            environmental monitoring programs associated with:

                     the atomic blasts above Japan--Radiation
                    Effects Research Foundation
                     resettling atolls in the Marshall Islands
                    affected by the U.S. thermonuclear ``Bravo'' test
                     the accidental dispersal of radioactive
                    materials in Palomares, Spain
                     nuclear weapons production activities in
                    Russia

             Continue to implement the Former Worker Medical
            Surveillance Program by conducting medical screening to
            determine potential health issues (which screening has been
            done for over 46,000 individuals to date and will continue)
             Provide rapid medical expertise, response, and
            physician training in response to accidental exposure to
            radiation via the Radiation Emergency Accident Center and
            Training Site
             Collect and analyze medical and industrial hygiene
            data on current workers exposed to beryllium, plutonium, and
            other hazards
             Continue to conduct studies to determine the effect of
            DOE operations on surrounding populations and communities
    Employee Compensation Program ($3,000,000)
        This activity funds DOE's efforts in support of the implementation
    of the Department of Labor (DOL) Energy Employees Occupational Illness
    Compensation Program Act. DOE assists DOL, the National Institute of
    Occupational Safety and Health (NIOSH), and the Advisory Board on
    Radiation and Worker Health by providing access to all available
    records and information needed to support claims filed by DOE
    contractor employees and to enable DOL to fulfill its statutory
    responsibilities. The fiscal year 2008 budget request provides for HSS
    to:

             Provide DOL, the NIOSH, and the Advisory Board on
            Radiation and Worker Health, access to all available records
            and information needed to support such claims in a timely
            manner
             Maintain improved communication and coordination with
            DOL and NIOSH through weekly conference calls and periodic
            meetings with Advisory Board on Radiation and Worker Health
             Work with line management to identify field contacts
            to improve program implementation
    Safety and Security Training ($14,756,000)
        Funding develops and maintains the proficiency and competence of
    DOE safety and security personnel through standardized training,
    education, and professional development services. Funding also provides
    for the conduct of workforce analyses and career development programs
    required for the protection of the environment, safety, and health of
    the public, the Departmental workforce, and critical assets and
    national security. The DOE National Training Center, in Albuquerque,
    NM, is the designated DOE Center of Excellence for safety and security
    training and the primary resource for performing these functions. The
    fiscal year 2008 budget request provides for HSS to:

             Conduct the Leadership Development Institute courses
             Host the semi-annual Federal Technical Capabilities
            Panel
             Increase focus on safety and security training
            interface, based on the safety and security expertise within
            HSS
             Increase utilization of the Integrated Safety and
            Security Training and Evaluation Complex
             Enhance Tactical Response Force Course by providing
            performance oriented training
             Conduct safety and security training needs assessment
            surveys to identify training requirements for new security and/
            or safety technologies
    Security Operational Support ($14,345,000)
        Security Operational Support activities provide technical expertise
    to support the implementation of Department-wide security requirements.
    The fiscal year 2008 budget request provides for HSS to:

             Continue evaluation of the Design Basis Threat (DBT)
            Policy and Security Directives (Policy) Zero Base-line Review
             Enhance rules of engagement in support of force-on-
            force performance exercises and for response to security events
             Continue implementation of the Elite Protective Force
            Initiative (the Department believes that the current contractor
            security force model is working well. There are certainly pros
            and cons to the Federalization question, but the Department has
            reviewed this option and concluded that the contractor model,
            coupled with our Elite Protective Force Initiative, provides
            the security posture that we expect in protecting our
            facilities and assets)
             Maintain the Human Reliability Program and continue
            implementation of Personnel Security Program Review
            recommendations
             Continue support for sharing methods and products to
            satisfy regulatory security requirements through the Security
            Awareness Special Interest Group
             Maintain security related data systems, e.g.,
            Safeguards and Security Information Management System, Incident
            Tracking and Analysis Capability
             Provide risk management, vulnerability assessment, and
            security system performance evaluations, verifications, and
            validations for identification and clarification of threats to
            departmental assets
             Continue support for the Foreign Ownership, Control or
            Influence and Foreign Visits and Assignments programs and
            associated data management systems
             Maintain the Nuclear Materials Management and
            Safeguards System (NMMSS) and other nuclear and radiological
            material tracking programs in support of international treaties
            and Nuclear Regulatory Commission initiatives
    Headquarters Security Operations ($24,942,000)
        Headquarters Security Operations supports the security protective
    force and systems designed to provide protection of DOE Headquarters
    facilities and assets. The fiscal year 2008 budget request provides for
    HSS to:
             Maintain physical protection and access control for
            DOE operations in the National Capital Area (Washington, DC,
            and Germantown, MD)
             Manage the Technical Surveillance Countermeasures
            (TSCM) Program for DOE Headquarters and contractors in the
            Greater Washington, DC, area
             Maintain security alarms and access control systems
             Conduct security briefings for DOE Federal and
            contractor employees; other personnel granted DOE access
            authorizations, and non-DOE personnel granted unescorted access
            to DOE Headquarters facilities

    Security Technology Development and Systems Deployment ($15,840,000)
        The Security Technology Development and Systems Deployment activity
    provides technology-based solutions to known security vulnerabilities
    throughout the DOE complex as an alternative to costly increases in
    manpower needed to implement the DBT Policy, and provides technologies
    to counter threats for which no current defensive capability exists.
    The activity identifies and evaluates commercial technologies to ensure
    that system performance is commensurate with operational security
    requirements before such technologies are purchased and deployed to
    protect critical national security assets. Funding also provides for
    the modification of existing technologies, deployment of technologies,
    and technical assistance to meet security requirements in the most
    cost-effective manner possible.
    Classification, Declassification, and Controlled Information
            ($11,678,000)
        This activity ensures that the Department meets its statutory
    responsibility to implement the U.S. Government-wide program to
    classify and declassify nuclear weapons-related technology (i.e.,
    Restricted Data and Formerly Restricted Data), and to implement the
    requirements of Executive Order 12958 to classify other information
    that is critical to the national security (i.e., National Security
    Information). This program identifies information controlled under
    statute to protect national security (i.e., Unclassified Controlled
    Nuclear Information) and other governmental, commercial, and private
    interests (e.g., Official Use Only). This activity also provides for
    the training and certification of DOE and other U.S. government
    Department and Agency personnel.
    Security Investigations ($37,836,000)
        This activity manages funding for background investigations to
    provide access authorizations to DOE Federal and contract personnel
    who, in the performance of their official duties, require access to
    classified information or certain quantities of special nuclear
    material. Background investigations are required by section 145 of the
    Atomic Energy Act of 1954, as amended, and EO 12968 (Access to
    Classified Information). The investigations are performed and access
    authorizations granted based on 10 CFR Part 710, Criteria and
    Procedures for Determining Eligibility for Access to Classified Matter
    or Special Nuclear Material. The centralized management of access
    authorizations and related data is performed in a cost-effective,
    efficient manner using electronic databases and Internet-capable tools
    that comprise the electronic DOE Integrated Security System (eDISS+).
    These electronic tools support and track the adjudication process from
    the beginning to the disposition of the access authorization request.
    Either the Federal Bureau of Investigation or the Office of Personnel
    Management performs the background investigations as required by law or
    DOE requirements.
    Program Direction ($100,043,000)
        Program Direction provides the salaries, benefits, travel, working
    capital fund and other related expenses for the 437 Federal employees
    as well as other resources and associated costs required to provide
    overall direction and execution of HSS programs. It provides for
    implementation of the Independent Oversight program of evaluating the
    Department's performance in safeguards and security; cybersecurity;
    emergency management; environment, safety and health; and any other
    subject areas as dictated by the Secretary and Deputy Secretary and
    support to the Departmental Representative to the Defense Nuclear
    Facilities Safety Board.
    Specialized Security Activities ($150,815,000)
        Funding is provided to identify and communicate information
    necessary to ensure adequate protection of the Department's national
    security assets.

                      HSS PRIORITIES FOR FISCAL YEAR 2008

        As the Chief, HSS Officer, I am constantly aware of the vital role
    and significant responsibilities HSS has to ensure the HSS functions of
    this department are strengthened. To meet this commitment, one of our
    major priorities is to institutionalize our activities. Additionally,
    other key HSS priorities for fiscal year 2008 to ensure we meet our
    commitment are to:

             Improve the quality and timeliness of safety and
            security policy and directives
             Enhance worker health and safety based on priorities
            developed from operating experience, health studies and
            surveillance data, independent oversight results, enforcement
            activities, and other stakeholder feedback
             Enhance Federal expertise in the area of line
            management oversight of field operations and the effective
            application of resources
             Improve issues management to provide a foundation for
            continuous improvement and preventing recurrences of adverse
            events
             Improve interface with the DNFSB
             Improve the worker health, safety, and security
            interface
             Implement the Elite Protective Force
             Increase Emphasis on Security Technology Deployment
             Continue and Enhance Independent Oversight

                               CONCLUDING REMARKS

        Mr. Chairman and members of the subcommittee, the Secretary of
    Energy created HSS to strengthen worker health, safety, environment,
    and security functions within the Department. Since its creation, HSS
    has received strong and continual support from the Secretary, the
    Deputy Secretary, and the Department's leadership. In the past 6
    months, we have made significant strides towards improving the health,
    safety, environment, and security functions of the Department,
    including better alignment of responsibilities associated with these
    functions. We are confident that with the continued support of DOE
    management, our stakeholders, and Congress, we can expand on the
    accomplishments of the past 6 months and further strengthen the
    Department's health, safety, environment, and security functions. This
    strengthening will better ensure that all DOE workers, the public, and
    our national security assets are safe and protected.

        Senator Bill Nelson. The protective force at the Pantex
    plant had a strike a couple of weeks ago. With one exception,
    the security forces that protect those weapons and materials
    are all contractors. So the issue that was raised at Pantex is
    a recruitment and retention issue, the ability to meet their
    physical and training requirements. It's pretty much age-
    dependent. So tell us, what do you think we ought to do about
    this as the security force ages?
        Mr. Podonsky. First I will clarify. None of the protective
    forces, contractors or the small group that are Federalized out
    of the Office of Secure Transportation, are part of our
    program, but they are supposed to follow our policies and we do
    inspect them.
        The strike at Pantex is extremely unfortunate. But the
    issue of Federalization--and you are correct, the entire guard
    force all across the complex are contract, either proprietary
    contract or subcontract, with the exception of the Office of
    Secure Transportation folks. In order to understand the full
    issue, if you will indulge me, Mr. Chairman, let me explain
    what former Secretary Spence Abraham wanted us to do in 2003.
    He wanted to set forth some initiatives in a post-September 11
    environment to strengthen the posture of security throughout
    the Department.
        So, one of those 14 initiatives was looking at an option of
    whether Federalization of the Guard force would make it a more
    effective force. What we did with the former Administrator
    Linton Brooks and myself and other parts of the Department, we
    constituted a protective force working group. What that working
    group did, for about 6 months, they examined all the options
    and they concluded that the contract force model combined with
    an Elite Force Initiative, which I will explain in a moment,
    would provide the protection strategies that we need at some of
    our most sensitive facilities.
        But the concept of Federalization in some sectors became
    something of a misnomer as to what that meant. What we
    discovered and what former Administrator Linton Brooks and
    myself said in correspondence to then-Deputy Secretary Kyle
    McSlarrow--was that, while that might prove to be an option
    that is favorable down the road, for the expedience of getting
    the safeguards security posture to the level that we need in
    the post-September 11 environment, we really need something
    quicker and more definitive.
        The working group discovered that the contract model
    together with the elite force concept was the best way to go.
        But the issue of taking care of our security forces, taking
    care of our first responders, is still very much there. Within
    the training requirements, which have been there since the
    1980s, we have various levels of expectations for the security
    officers and we have built into the requirements that if they
    are injured on the job or if they are getting older, like Mr.
    Rispoli and myself, and cannot perform any more, then there is
    a place for us to retreat to within the Guard force.
        What we think needs to happen--and I have talked to the
    acting Administrator, Bill Ostendorf, as recent as this
    morning--is we think that not only down at Pantex, but our
    entire security forces, need to be dealt with in a fashion that
    they feel like they are being taken care of. They are putting
    their lives on the line and we do think that the policies are
    there to help them. But, I think it would be helpful for us to
    examine further what else the Department can do in that regard,
    because there may be retreat capabilities back into
    corporations that they are working for or other solutions.
        Senator Bill Nelson. Well, you were recently at Pantex.
    What is your assessment of their capabilities?
        Mr. Podonsky. We were asked by the Secretary and the acting
    Administrator to send an independent group down and they went
    down last week. To the credit of the Pantex site office, they
    did an extremely outstanding job standing up a contingency
    force. Our folks, 10 days into the strike, felt that the
    security forces were providing competent security at the levels
    that we would expect.
        Our biggest concern, Mr. Chairman and Senator Sessions, is
    the sustainability. With the number of hours that the security
    officers are working, with the amount of time that they are
    going to put in, not knowing when the strike might be over, we
    are concerned about the level of security over the long haul.
        So at the 10-, 11-, 12-day period when my inspectors were
    down there, I have every confidence to tell you that nuclear
    material is protected. But beyond that, we become very
    concerned, and we have expressed this to the acting
    Administrator and we have expressed this to the Secretary.
        Senator Bill Nelson. This temporary protective force that
    was assembled was pulled from other areas. What is the effect
    on the other sites and transportation requirements?
        Mr. Podonsky. We have not gone out to assess it. But in
    talking to the safeguards and security directors at those
    sites, for the short haul, which they consider is the 30-day
    period, they do not feel that their safeguards security posture
    will be adversely affected. But we, from an independent
    standpoint, again feel the sustainability is going to be the
    question.
        So it is not just going to be the Pantex safeguards and
    security posture that we are going to be concerned about, but
    it is going to be these other sites, Mr. Chairman, as you point
    out, where they provided security officers who are working
    extended hours. They are going to have to be rejuvenated when
    they go back to their own sites. So there is a long line of
    concerns that exist with every passing day.
        Senator Bill Nelson. Who is in charge of security at Pantex
    today?
        Mr. Podonsky. It is a guard force out of BWXT, which is the
    main contractor. Then they report to BWXT, and of course BWXT
    reports to the NNSA through their site office.
        Senator Bill Nelson. Well, Federal forces cannot be under
    the authority and direction and control of contractors.
        Mr. Podonsky. That is correct.
        Senator Bill Nelson. How have you avoided that here?
        Mr. Podonsky. What NNSA has avoided is that the Office of
    Secure Transportation, those couriers that went to help
    supplement the security forces, they are under the supervision
    of the Federal site office, is what I am told. So they avoided
    the Federal couriers being directly supervised by the contract
    guard force. It seems to be working, but that also is an
    awkward way to operate.
        Senator Bill Nelson. You jump in at any point here.
        I will conclude this part. What about these other
    protective force contracts as they are coming up for
    negotiation? Are we anticipating any strikes there?
        Mr. Podonsky. Mr. Rispoli, for example, at Savannah River
    has a protective force contract that is coming up. It is my
    understanding, using his site as an example, is that they have
    agreed to hold off on the renewal of the contract, and we
    believe that this is going to be the theme throughout the
    complex. People are watching to see what the results are out at
    Pantex.
        So there is no doubt, Mr. Chairman that the reverberation
    is going to be more than just Pantex.
        Senator Bill Nelson. Do you think that DOE could manage a
    temporary protective force at more than one site?
        Mr. Podonsky. I am not a labor law expert, but I do believe
    that from a standpoint of how many security officer strikes we
    can handle. I think we are going to be stretched just with the
    one that we are working on now.
        Senator Bill Nelson. Then the next question that is begged
    is--when does work slow down or stop as a result of the
    security concerns?
        Mr. Podonsky. Well, we plan to go back down to Pantex, for
    example. If they go beyond the 30 days, we plan to go back down
    to see what the effect is long term. Our recommendation may, in
    fact, be to the Administrator and to the Secretary that they
    may have to curtail operations.
        Senator Bill Nelson. In the past, DOE has looked at
    management options for the protective forces. Do you know
    anything about those reviews in the past and could you
    summarize for the Committee the findings and the conclusions?
        Mr. Podonsky. There has been a number of studies over the
    last 20 years on security of the DOE. All of them resulted in
    what I would summarize from my personal and professional belief
    is that a concern in terms of the rigor in which security is
    being focused on by management.
        Part of the organization that I manage, the predecessor
    that was created from Security Operations, which was policy,
    and the Office of Security and Safety Performance Assurance,
    which was oversight--former Secretary Abraham pulled those two
    offices together and we saw in the last 3 years quite an
    improvement in performance of security based on putting the
    policy and the overseers together so they were not at conflict
    and they could check out how effective the security forces were
    and how effective the policy was, because, quite honestly, Mr.
    Chairman, the security policies as well as the safety policies
    need to be reviewed so that they are better understood and the
    implementation can be made in a way that is not so costly.
        One of the issues that Secretary Bodman saw, as I mentioned
    at the beginning of my opening statement, we also saw the
    problem with the safety. I would conclude it this way after a
    number of years in the Department. It is not rocket science. It
    is a matter of managing the resources and taking care of the
    people and making sure that they can take care of the mission.
        Senator Bill Nelson. Well, let us know if you need any
    legislation on this whole matter of security.
        Senator Sessions. Mr. Podonsky, as I understand it the
    striking employees are employees of a private contractor.
        Mr. Podonsky. Yes, sir.
        Senator Sessions. The strike is to call on not the
    contractor, but the Federal Government, to make them Federal
    employees? Is that what the issue is?
        Mr. Podonsky. I have to be somewhat cautious since there
    are negotiations going on between the company and the union. As
    I understand it, there are a number of issues at play. One of
    the issues that seems to be a prevailing issue that has been
    written about in the newspapers and talked about in a number of
    sectors was this issue of Federalization. I think, Senator
    Sessions, when you were out I talked about Federalization.
        But briefly, I will just tell you, we did in fact for
    former Secretary Spence Abraham do a special review of the
    option of Federalization, which was not the intent.
    Federalization was an option possibly to improve the posture of
    how we have our protective forces. What I mentioned to the
    chairman is that the committee that was both field experts as
    well as headquarters, both NNSA and the Department, concluded
    that the contractor model together with what we call an Elite
    Force Initiative provided us the posture of security that we
    needed throughout.
        Senator Sessions. But is that not a basis for the strike? I
    just do not know.
        Mr. Podonsky. I believe, in my personal opinion, that it is
    an understanding by the security forces that Federalization
    might provide them job security, which they do not currently
    have. That is what their view is.
        Senator Sessions. That is, I am sure, because it is hard to
    leave the Federal Government, except for us. We can be voted
    out like that.
        Mr. Podonsky. After this hearing, Senator, I might be out
    too.
        Senator Sessions. Maybe not. Thank you.
        Well I am sorry we have had that strike. I have been
    through those processes and had some that worked out where we
    privatized things like lawn care at military bases and other
    things have been privatized. Other things have not proven to be
    effective to privatize. So it is a matter worthy of
    consideration.
        Mr. Rispoli, thank you for your testimony. You seem to be
    in command of the facts and figures of these issues and I
    respect that. For example, the $3 billion contingency fund that
    you hope not to spend, if the DOE does not spend it who gets
    that money?
        Mr. Rispoli. That $3 billion, of course, is spread out over
    the entire construction period for the project, which goes to
    2019. So as we enter each year and we have that contingency
    amount set aside, if it is not spent then we would be required
    to come back to Congress under the current reprogramming rule
    if we wanted to move it anywhere else.
        I will also mention to you that because of the significance
    of this project, Deputy Secretary Clay Sell has asked me to
    brief him once a month on this project. Part of that briefing
    will be a focus not only on the performance of the contractor,
    but also whether or not any of that contingency needs to be
    used in a month-by-month basis. So we are keeping a very close
    hold on the use of that contingency.
        Senator Sessions. But it does not redound to the benefit of
    the DOE. It really would either go back to the DOD or be spent
    otherwise on some DOD program in the DOE.
        The only point I was making with that, as I indicated to
    you earlier, is that one of the things I think, Mr. Chairman,
    that is a bit dysfunctional in this process is that DOE manages
    these programs. But, unlike the DOD, let us say they save money
    on a missile system or aircraft, they can spend it on some
    other program. If he saves money on a cleanup, he does not get
    it; it goes. So I think the DOE has less of an incentive than
    you would like to rigorously manage these contracts.
        But I raised this for Secretary Bodman last year. It does
    appear you have taken a number of aggressive steps, I have to
    say, and I am thankful for that. How did you discover there was
    a $50 billion underestimate of the cost?
        Mr. Rispoli. We found that primarily in two ways. One is
    that there had been an artificial wall, you might say, that
    precluded or kept out of our program known cleanup, much of it
    at Oak Ridge, much of it at Los Alamos, but really throughout
    the complex. You may recall that at one time the Department had
    proposed creating an office called the Office of Future
    Liabilities. The idea was to lock down the EM program to just
    this, period, this looking back, and all these future needs
    coming up would go to another office.
        Well, this wall had been placed that shut out known work at
    Oak Ridge, Los Alamos, and other sites. So a large segment of
    what has to be added to the program is that artificial wall
    that kept these projects out.
        Senator Sessions. You are sure these are legitimate, these
    are going to be necessary costs? When was this miscalculation
    effectuated? Before your time?
        Mr. Rispoli. It was before my time in this position. But
    the Deputy Secretary issued a program decision memorandum in
    August 2006, that essentially established my organization as
    the office that would take on future liabilities such as those.
    So that prior decision was reversed in August 2006. But I do
    not want to mislead you. The other part of the program growth
    is due to, for example, the waste treatment plant at Hanford
    and the resulting cost of having to operate that tank farm for
    many years more than we originally thought. So it is a mix of--
    --
        Senator Sessions. Why is it many more years than you
    originally thought?
        Mr. Rispoli. The waste treatment plant was----
        Senator Sessions. Somebody should have thought about this,
    should he not?
        Mr. Rispoli. The waste treatment plant was envisioned to
    come on line much sooner and because it cannot come on line
    sooner, but it is sized to process so many gallons per year,
    that means that since it cannot begin on time. It therefore has
    to extend its functioning for so many more years in the future.
        Senator Sessions. Is it entirely settled with the State of
    Washington what amount of waste might be left in the tanks? It
    that something firmed up?
        [The information referred to follows:]

        The Office of Environmental Management has confirmed that the 99-
    percent target figure is correct.

        Mr. Rispoli. The State of Washington knows how much we
    endeavor to remove from the tanks. If I am correct--and if I am
    not I will correct myself for the record--but 99 percent is the
    target; to remove 99 percent of the waste from those tanks and
    process it through this waste treatment plant. The balance of
    the waste in that tank, the intent would be to grout those
    tanks to stabilize them so they would not collapse, and you
    would protect the public and the environment from whatever
    residual is left inside those tanks, the remaining small
    percentage.
        Senator Sessions. The matters are complex. I know there are
    lawsuits pending. The State of Washington is making a number of
    demands and some of those actions have delayed matters, which
    increases costs. You would think that they would want to
    proceed as rapidly as possible. I know there are just a lot of
    difficulties there and I do not minimize it. I have been
    through cleaning up poisonous gas and I know how people in
    communities care about it.
        But ultimately it is the responsibility of, I guess the two
    of you, what is safe, and what is sufficient. It is not over
    with me in terms of, if we could do this cleanup, which is a
    very vague thing in my mind--I am not sure how exact it is--you
    save 10 percent that is $17 billion, that is real money here.
        So I hope that you will continue to manage this as closely
    as you can. I intend to study it more myself.
        Mr. Rispoli. Yes, Senator. If I may, again the keys are
    better estimates with a better evaluation of assumption of
    risk, stronger Federal management and oversight of our
    contractors, and the way we structure the contract to
    incentivize exactly what you are talking about, and that is
    saving money and saving time. Those are the elements that we
    are pushing on to implement as we go forward.
        Senator Sessions. I just have to tell you that to have an
    announcement that we have a $50 billion error in our accounting
    is one of the biggest errors maybe in the history of the
    Republic. I do not know, but that is a lot.
        Mr. Rispoli. Yes, sir.
        Senator Sessions. So somehow we need to watch it closely.
        Thank you, Mr. Chairman.
        Senator Bill Nelson. There has always been disagreement
    over the future for the EM and whether or not we are going to
    clean up past contamination and contaminated facilities, or if
    we are going to set an arbitrary date to stop work and other
    programs are going to assume the responsibility for that
    cleanup.
        Now, the arbitrary date was not realistic. Is there, Mr.
    Secretary, a process for understanding and planning additional
    cleanup and decommissioning activities, particularly as the
    NNSA begins to consolidate the weapons complex further?
        Mr. Rispoli. Mr. Chairman, that is a very significant
    question, and in fact the August 2006 reference I made to a
    program decision by the Deputy Secretary essentially answers
    that question. The answer to that question is that as any
    program, whether it be the NNSA or the Office of Science or the
    Office of Nuclear Energy, which is in Idaho, for example. As
    they complete their use of facilities, if those facilities are
    contaminated they would become the programmatic responsibility
    of my program.
        That is part of the reason why there is program growth,
    because one way or the other those facilities will have to be
    taken care of. The Department has chosen to put them into the
    EM program rather than have three or four entities on the same
    installation.
        Let us take Oak Ridge: has EM, it has the Office of
    Science, and it has the NNSA. If each one were doing their own
    cleanup, it would be very, very hard to really recognize the
    full cost of cleanup and it would I think be confusing for the
    regulator and the State to have to deal with three separate
    entities doing the same type of work.
        So I personally believe the decision by the Deputy
    Secretary, as concurred in by all of the planners in a
    recommendation to him, is the correct one. That is that all of
    these future liabilities should be turned over to the Office of
    Environmental Management, who would build the expertise and the
    contract tools to do it.
        So it is program growth, but we have to recognize that part
    of that program growth is future liabilities that have to be
    added to the program. Otherwise, as you asked in your question,
    the NNSA would be doing some and the Office of Science would be
    doing some. I am not sure that would be the best way to manage
    this effort at a given installation.
        Senator Bill Nelson. Did you ask for this job?
        Mr. Rispoli. No, sir. I was invited to this job and I am
    honored to be here.
        Senator Bill Nelson. Mr. Podonsky, your office issued the
    most recent Design Basis Threat (DBT) analysis. When must all
    the DOE sites come into compliance with your design basis
    threat analysis, DBT analysis?
        Mr. Podonsky. Mr. Chairman, if you will again allow me, let
    me explain. I will answer your question. The DBT is not a
    threat assessment from the Intelligence Community. It is
    advised by the Intelligence Community and they give us what
    they consider to be concerns that we should be putting in our
    planning.
        The DBT then becomes a tool for the security planners on
    strategies to be deployed, and moneys to be planned. It is a
    very important process. The November 2005 DBT was signed by
    Deputy Secretary Sell, and the agreement was that everybody
    would be in compliance by the end of fiscal year 2008. In fact,
    there are multiple sites that are moving successfully towards
    that completion. They have proven to be successful in the fact
    that the 2003 DBT, they had to be completed by the end of
    fiscal year 2006, which we just passed, and everybody was
    meeting up to those numbers.
        What the Deputy Secretary also considered is that there are
    some sites that have special considerations that need to be
    planned for and budgeted for. So there are one or two sites
    that will not be compliant by that date of 2008, but they have
    exceptions from the Secretary.
        What we are doing as an independent arm of the Department
    is we are assessing how progress is being made. Quite candidly,
    in a post-September 11 environment we are very concerned about
    how fast we lay out our protection strategies and meet those
    strategies.
        As I have said in my opening statement, we are currently
    comfortable to state to you and the committee that the security
    assets at the Department are in fact being protected. But it is
    an evolving threat that we face and with an evolving threat we
    also have to keep in mind that we have to continue assessing
    the performance at those sites.
        Those sites that will not be compliant by 2008, we are
    looking for compensatory measures to be in place so in fact
    nothing is going to be more vulnerable than we intended it to
    be.
        Senator Bill Nelson. Other than Hanford, what are the ones
    that are not going to make your deadline?
        Mr. Podonsky. The other one as I recall is, I want to say
    Savannah River. They are on track, but we are watching. Off the
    top of my head, and I will give you a more complete answer for
    the record, but from the NNSA sites, Pantex, Y-12, most all of
    their facilities are on track. The facilities that are not on
    track, obviously Hanford was one, and I will have to double-
    check which is the other one. There are only two, I believe.
        Senator Bill Nelson. Let us know for the record, and when
    you expect them to come into compliance.
        [The information referred to follows:]

                        2005 Design Basis Threat Policy

        The Department of Energy recently completed its annual review of
    the Design Basis Threat (DBT) Policy, which resulted in the affirmation
    that the 2005 DBT continues to balance complex safeguards and security,
    operational, fiscal, and safety planning factors to achieve a stable
    and long-term security planning base. Additionally, based on the
    lessons learned from the successful implementation of the 2003 DBT, the
    annual review and subsequent Departmental guidance acknowledges that
    the Program Offices, in conjunction with their site elements, should
    determine ``how'' and ``when'' the 2005 DBT will be implemented. This
    additional provision allows for the prudent consideration of each
    site's unique operational and security planning variables, and supports
    the most efficient means of implementation through the relocation and/
    or consolidation of special nuclear material and/or the application of
    security technologies. Based on these factors, implementation will be
    accomplished in a phased manner with unique and well defined milestones
    for each site. As an example, Pantex, the Office of Secure
    Transportation (OST), and Lawrence Livermore National Laboratory (LLNL)
    will implement the 2005 DBT by the end of fiscal year 2008, whereas Y-
    12 is already compliant with the 2005 DBT at one facility, and their
    remaining facilities will be compliant following the construction and
    transfer of special nuclear materials to the Highly Enriched Uranium
    Materials Facility (HEUMF). HEUMF illustrates the efficiencies (e.g.,
    cost, increased survivability, etc.) that can be attained by
    integrating advanced security technologies in the facility design
    process, versus the continued reliance on manpower to address security
    challenges presented by antiquated facilities.
    Background
        For each site with a proposed implementation date beyond the end of
    fiscal year 2008, each site is required to systematically address their
    current system performance, the feasibility of compensatory and interim
    security measures, and the level of performance and risk over the out-
    years based on cost-benefit analyses. These factors combined with and
    coordinated among other budgeted programmatic initiatives (e.g., line-
    item construction projects) provided the necessary information for
    senior decision makers to ensure the feasibility and appropriateness of
    the long-term DBT implementation goals.
        Status of sites:
        Y-12--As noted in the National Nuclear Security Administration
    (NNSA) 2003 DBT Implementation Report, the 2005 DBT was fully
    implemented at one Y-12 facility. The remaining Y-12 facilities are
    scheduled to be compliant by the end of fiscal year 2011, which
    corresponds to completion of the HEUMF. This deferral of implementation
    is consistent with sound risk management principles and will result in
    avoidance of costly and temporary security enhancements (e.g., hiring
    additional protective force personnel) for those materials that will
    ultimately be relocated to HEUMF.
        Pantex--Implementation of the 2005 DBT is scheduled to be completed
    by the end of fiscal year 2008.
        Lawrence Livermore National Laboratory--Implementation of the 2005
    DBT is scheduled to be completed by the end of fiscal year 2008.Nevada
    Test Site--Due to the cost and complexity of the proposed 2005 DBT
    upgrades, NNSA is scheduled to implement the 2005 DBT at NTS by the end
    of fiscal year 2009.
        Los Alamos National Laboratory (LANL)--Implementation of the 2005
    DBT at LANL is scheduled for the end of fiscal year 2011. This
    milestone corresponds to the completion of the Nuclear Materials
    Safeguards and Security Upgrades Project II (NMSSUP Phase II) which
    provides the permanent security upgrades needed to meet the DBT
    requirements in a cost effective manner.
        Sandia National Laboratories (SNL)--Technical Area--V at SNL will
    be de-inventoried below a category I/II SNM quantity by the end of
    fiscal year 2008 thereby eliminating the need for any additional
    enhancements or upgrades to meet the 2005 DBT.
        Office of Secure Transportation--OST is scheduled to implement the
    2005 DBT by the end of 2008.
        Oak Ridge National Laboratory (ORNL)--The Under Secretary of
    Science rendered a non-enduring facility status determination for the
    ORNL facility on April 9, 2007, with notifications to the Deputy
    Secretary. As such, the site will maintain appropriate security
    measures associated with the 2003 DBT and will add additional security
    enhancements above this level as required.
        Idaho National Laboratory--The Idaho National Laboratory has
    requested an extension until August 17, 2007, for submitting its
    implementation plan for the 2005 DBT.
        Savannah River Site (SRS)--Implementation of the 2005 DBT is
    scheduled to be completed by the end of fiscal year 2008.
        Hanford--The site is currently operating on an approved deviation,
    which supports relocating select materials by the end of fiscal year
    2009 and delaying full implementation of the 2005 DBT. The site is
    using risk management principles to maximize the cost-benefit of
    resource allocations while providing the greatest long-term security.

        Senator Bill Nelson. Senator Thune?
        Senator Thune. Thank you, Mr. Chairman, and I want to thank
    the panel for your work and for the recognition by your agency
    and by Secretary Bodman of the importance to our national
    security of expanding our Nation's use of renewable fuels by
    requiring the use of 35 billion gallons of renewable fuels by
    2017.
        I represent a State that has the ability to be a major
    contributor to this effort through the production of ethanol as
    well as other sources of alternative energy. I have often
    described my State as the Saudi Arabia of alternative sources
    of energy, particularly wind. We have lots of wind.
        But your work on the issue is no doubt going to help us
    advance the cause of national security by us promoting energy
    security, and so I thank you for your efforts on that important
    issue.
        Just a couple of questions if I might. This question has to
    do with your agency's counterproliferation programs. I would
    like to ask this question and respond to it if you can, but my
    understanding is that Russia is currently producing about 1.2
    metric tons of weapons grade plutonium per year in three of its
    nuclear reactors. I also understand that we are working with
    the Russians to turn these reactors into fossil fuel power
    plants through the elimination of the weapons grade plutonium
    production program as part of our nonproliferation efforts.
        When do you anticipate that this transformation from
    nuclear reactor to fossil fuel plant will occur, and why is it
    that the Russians continue to manufacture what seems to be a
    needlessly large amount of weapons grade plutonium and simply
    increasing the risk that it could fall into the hands of
    terrorists?
        Mr. Rispoli. Senator Thune, thank you for that question. I
    am familiar with that program from a prior position in the
    Department. I know about the initiative in two of the former
    Russian nuclear cities to replace the weapons-producing
    reactors with fossil power plants. Unfortunately, that program
    is not part of my purview, so I can take that question for the
    record, but I cannot answer that question.
        [The information referred to follows:]

             The three remaining Russian plutonium-production
            reactors, which are graphite-moderated reactors built in the
            1960s, provide essential heat and electricity to the nearby
            cities of Seversk and Zheleznogorsk. They also, as a function
            of their operation, produce weapons-grade plutonium. Plutonium
            production is a byproduct of the production of heat and
            electricity. One action cannot occur without the other.
             DOE/NNSA's Elimination of Weapons Grade Plutonium
            Production (EWGPP) program, which is being conducted under the
            auspices of the Plutonium Production Reactor Agreement between
            the United States and Russia, seeks to eliminate the production
            of weapons-grade plutonium from these reactors. Under the EWGPP
            program, the United States is working with the Russian
            Federation to build fossil fuel power plants that will provide
            replacement heat to the cities surrounding the plutonium-
            producing reactors. In exchange, the Russian Federation has
            agreed to permanently shut down the reactors.
             It is anticipated that the first two reactors will
            permanently shut down by December 2008 when the fossil fuel
            plant will come on line in Seversk. Weapons grade plutonium
            production will decline from approximately 1.2 metric tons per
            year to approximately 0.4 metric tons per year. The last
            reactor in Zheleznogorsk is scheduled to be permanently shut
            down by December 2010 with the last fossil fuel plant beginning
            operation at that time, ending weapons-grade plutonium
            production in the Russian Federation.

        Senator Thune. That would be great if you could.
        Do either of you happen to know, and I just ask this
    question, how much weapons grade plutonium the U.S.
    manufactures annually?
        Mr. Rispoli. I believe the answer to that is zero today,
    yes, sir.
        Senator Thune. That was my assumption.
        Mr. Rispoli. Now, of course, my program is working together
    with the weapons side of the house, the NNSA, to disposition
    the excess plutonium that is in our departmental inventory,
    with the purpose of reducing the potential for proliferation
    into the wrong hands. So we and our NNSA partners are working
    toward that and, as I mentioned a little while ago, we just
    delivered today to this committee and others a business case
    analysis of the approach for disposing of surplus weapons grade
    and weapons usable plutonium. This is the most current thinking
    as to how we would do that. Basically, we would do that at the
    Savannah River site in South Carolina.
        Senator Thune. Mr. Podonsky, in terms of personnel
    security, I also want to touch on the issue of the October 2006
    case of the classified documents that were removed from Los
    Alamos by a contractor. From what I understand, the security
    lapse would probably not have been discovered had it not been
    for a domestic disturbance at the contract employee's home. It
    turned out that this contractor has classified files at her
    residence, and we have also learned that the contractor had
    been using illegal drugs within 30 days of her security
    clearance being approved.
        Given the emphasis on safety and security within your
    agency, could you perhaps inform us on the steps that are being
    taken to correct the personnel security deficiencies at Los
    Alamos?
        Mr. Podonsky. Yes, Senator. Secretary Bodman initiated two
    task forces. One was looking at the cybersecurity. That was
    headed up by our Chief Information Officer, Tom Pike. The other
    was the task force on personnel security that he asked the
    three under secretaries and myself to head up, with my office
    taking the lead.
        What we concluded and made recommendations to the Secretary
    that he agreed to is that the security professionals that are
    in the business of making the determinations on security
    clearances, we needed to have a more robust training and a
    certification, which was not taking place previously. We needed
    to do an implementation of a more rigorous drug testing program
    within the Department. We needed to take a look at the policy
    for personnel security to make sure that it was consistently
    applied, and in order to do that redouble our efforts for
    quality control over the decisions that were being made out in
    the field elements.
        Then the final one was to develop an organization where all
    the personnel security functions came into one organization.
    The Secretary finally decided, with the Deputy Secretary, that
    that organization would reside within my office. So we are
    moving out to look at the setting up of that program, and are
    making sure that we have the policies in place that are going
    to be fully implemented and understood.
        Our national training center, which also falls under us, we
    have a training program and a certification program being set
    up right now as we talk. We have instructed our inspectorate to
    make sure that they redouble their efforts in terms of
    inspecting what they are doing out there in the personnel
    security environment.
        The other thing that we also are doing is doing a complete
    review of the case files during that time period of the subject
    review. We did an initial review while we were there.
    Coincidentally, when we were at Los Alamos at the time that
    this broke, we were already doing a regular scheduled
    inspection. Part of our inspectorate went down to Albuquerque
    service center and took a look at the cases, and in a closed
    session I can tell you what we found. But we did find that the
    steps that the Secretary agreed to were very important to take.
        Senator Thune. Let me just ask you one other question. You
    are the Chief Health, Safety, and Security Officer for the
    Department. Regarding another issue I guess you could argue on
    personnel security and cybersecurity within the agency, but the
    Federal Emergency Security Management Act, which establishes
    procedures to ensure information security within all agencies
    of the Federal Government. I assume you are probably aware that
    that annual scorecard that is issued by the House Government
    Reform Committee ranking member last year graded your agency as
    an F in information security, this year has upgraded to a C-
    minus.
        Obviously, as the steward of our nuclear stockpile, top-
    notch information security is absolutely critical. I appreciate
    the fact that you are obviously taking significant steps to
    improve cybersecurity and I think that is reflected in the
    improvement in your FESMA score. But I wonder if you could tell
    us your thoughts on your agency's score, what steps you plan to
    take to further improve security at your agency. My
    understanding is that, as you said, the task force has been
    established, and if you could just elaborate a little bit on
    that.
        Mr. Podonsky. Mr. Pike is our chief information officer and
    he is responsible for the policies for cyber. Those are the
    only policies that we do not have in our organization. We are
    responsible for the independent oversight and we are working
    very closely with Mr. Pike because over the last decade we have
    seen a number of issues with cybersecurity throughout the
    complex. We have seen some improvements in terms of the
    understanding of what their implementations are, but we have a
    long way to go.
        In fact, the entire Government has a long way to go. I
    would tell you, Senator, it is not the physical security part
    of our Department or any other agency that I worry the most
    about. I worry mostly about our cyber world. We have a cyber
    penetration lab out in Germantown, Maryland, and at one point
    we actually moved it here to the floor of the House to do a
    live demonstration of how easy it is for hackers to get into
    unclassified arenas.
        We have a red team, which is a no-notice penetration team,
    that if you rank order kiddie hackers at, say, a level 3 and
    more sophisticated hackers at a level 2, and then nation
    states--and I will not go into classified here--that are really
    sophisticated, we are at a high level 2, and we are constantly
    challenging the Department and its capabilities. So when we
    talk about the improvements, there have been improvements under
    Mr. Pike's leadership and with Secretary Bodman's encouragement
    and support. But we also continue to do active security attacks
    ourselves using our penetration lab to still continue to plug
    the holes.
        Part of the problem for the entire Government, not just the
    Department, is how fast the dynamics of the threat is in the
    cyber world. No sooner do we plug a hole, fix vulnerability,
    than they figure out another way to come. So it is a real
    challenge.
        The rating systems that are in the Government Reform--and
    it is notable that the Department moved up, but it would be
    much better for our agency to be at a much higher level,
    considering all that we are protecting.
        Senator Thune. I assume that we are trying to hire all the
    best counter-hackers to make sure that we are meeting the skill
    sets and the level of capability that the hackers have to get
    in? I mean, you are absolutely right, this is a very serious
    threat and it is the world we live in. If there are resource
    issues associated with that, that we need to address, certainly
    let us know what those are, because I, like you, am very
    concerned, not only with your agency, which because of its
    stewardship of the nuclear stockpile is critical, but I think
    in every agency of Government this is a very serious, again,
    real world threat that we face.
        Mr. Podonsky. Senator, if I might add, and Mr. Chairman,
    from a classified, our classified network is very well
    protected. It is the other areas, the research and development.
    It is the unclassified arena that we are all very concerned
    about, and I think every one of us in Government should be
    concerned about the cyber world.
        Senator Thune. Thank you.
        Thank you, Mr. Chairman.
        Senator Bill Nelson. Secretary Bodman's statement will be
    made a part of the record and the record will stay open for 4
    days.
        The hearing is adjourned. Thank you.
        [Questions for the record with answers supplied follow:]

                   Questions submitted by Senator Bill Nelson

                          RELIABLE REPLACEMENT WARHEAD

        1. Senator Bill Nelson. Secretary Bodman, one of the most difficult
    decisions that Congress will face this year with respect to your
    Department is whether or not to begin the research funds for the
    Reliable Replacement Warhead (RRW). How important is it in your view
    that funds be made available for the phase 2A study on the RRW?
        Secretary Bodman. Funding for the RRW Phase 2A Design Definition
    and Cost study is very important. The 18-month study conducted in 2005
    and 2006 determined that development of replacement warheads with
    larger performance margins and certifying them without additional
    underground nuclear testing are feasible. The Phase 2A study will
    develop the detailed cost, scope and schedule baseline for the RRW
    which is needed by National Nuclear Security Administration (NNSA), the
    Department of Defense (DOD), and Congress in order to make informed
    decisions on whether and how to proceed to the engineering development
    phase.

        2. Senator Bill Nelson. Secretary Bodman, in testimony before the
    House Armed Services Committee, former Senator Sam Nunn said, with
    respect to the RRW, ``I believe that this will be misunderstood by our
    allies, exploited by our adversaries, and complicate our work to
    prevent the spread and use of nuclear weapons.'' Senator Nunn went on
    to say that the RRW would be better received in the context of a
    ratified Comprehensive Test Ban Treaty. What consultations have
    occurred with other nuclear weapons states such as Russia, France, the
    United Kingdom, and China, as well as non-nuclear weapons states who
    are friends and allies, and with what result?
        Secretary Bodman. In advance of the announcement of preferred RRW
    design, the Department of State and the Department of Energy (DOE)
    consulted with allies of the United States to ensure that they would
    have accurate information relating to the RRW.
        Specifically, the Department of State consulted with the North
    Atlantic Treaty Organization (NATO) countries, Japan, South Korea, and
    Australia, and also with Russia, Ukraine, and China in advance of the
    joint DOD-DOE March 2, 2007, announcement of the selection of the
    preferred RRW design. Information about the March 2 RRW announcement
    was also sent to other U.S. diplomatic posts for use if asked by other
    governments. In addition, both before and after the March 2
    announcement, DOE officials met in Washington with officials from the
    embassies of the United Kingdom, Japan, France, Germany, and Denmark,
    at their request, to discuss RRW and proposed plans for the Complex
    2030 transformation. All feedback received from foreign governments was
    positive and none have expressed any concern with regard to our plans
    for RRW.

                          ANNUAL CERTIFICATION PROCESS

        3. Senator Bill Nelson. Secretary Bodman, the annual certification
    process includes a review of each weapon in the stockpile by the
    laboratory directors, the Commander of the Strategic Command, you, and
    the Secretary of Defense. You are just in the process of finishing an
    annual review for 2006. Is the stockpile safe, secure, and reliable?
        Secretary Bodman. Yes, the 2006 report will reflect that the
    stockpile is safe, secure and reliable and that resumption of
    underground nuclear testing is not required at this time.

        4. Senator Bill Nelson. Secretary Bodman, any decision to build or
    deploy an RRW is years away. But in thinking about the RRW and the
    ongoing annual certification process, how would you think about
    establishing an annual certification process for the RRW?
        Secretary Bodman. If an RRW design is eventually produced and
    placed into the stockpile, it will be reviewed in the annual assessment
    process along with the other warheads in the stockpile. The NNSA design
    laboratories would employ the same broad approach used to verify the
    continued performance of existing warheads. The approach employs tools
    developed under the Stockpile Stewardship Program, including a
    combination of extensive experiments, computational tools, data
    analysis from past nuclear tests, and peer review. The RRW will be
    designed so that key performance parameters are farther away from
    failure points (have greater margin) than current warheads designed for
    high yield to weight. Improved warhead performance margins that will be
    incorporated into the design will reduce uncertainty due to aging, and
    reduce the likelihood that underground nuclear testing will be required
    in the future to resolve a technical problem in the stockpile. The
    quantification of margins and uncertainties for key performance
    parameters will aid in understanding the limits of the performance and
    be the basis for the laboratory directors' certification of a RRW
    design. Engineering and non-nuclear components will have a rigorous
    testing program and the design for these features will consider life-
    cycle surveillance needs. This approach will give designers higher
    confidence in their ability to certify the design without underground
    nuclear tests.

        5. Senator Bill Nelson. Secretary Bodman, does the Office of
    Science play a role in the annual certification process? If so, what
    role and why?
        Secretary Bodman. The Deputy Administrator for Defense Programs has
    primary responsibility for the coordination and work involved in the
    annual assessment process for the nuclear stockpile. The role of the
    Under Secretary of Science in that process is to serve as an
    independent advisor to the Secretary and to provide his independent
    advice and recommendations.

                               PROJECT MANAGEMENT

        6. Senator Bill Nelson. Secretary Bodman, the DOE builds first-of-
    a-kind, or one-of-a-kind, technically-complex projects. In many
    instances these projects have experienced significant cost overruns and
    schedule delays. The Office of Engineering and Construction Management
    (OECM) was established to help provide an independent review and
    assessment of the cost and schedule baseline for these projects.
    Initially this office reported directly to the Deputy Secretary of
    Energy and had independent budget authority, and had started to require
    independent cost estimates (ICEs) for projects. I am concerned that the
    flexibility of the office, as well as the rigor and the funding for the
    office has diminished. The funding is provided from program offices and
    the ICEs have been replaced by cost reviews--reviews of the contractors
    costs but not an independent cost development. How is the funding
    provided to OECM in the fiscal year 2008 budget request?
        Secretary Bodman. ICEs have not been replaced by independent cost
    reviews (ICR). As part of an External Independent Review (EIR), the
    OECM determines whether an ICE or an ICR is conducted based upon the
    respective project's complexity and risk profile. In fiscal year 2008,
    the DOE Programs fund OECM's EIRs.

        7. Senator Bill Nelson. Secretary Bodman, must the OECM rely on any
    program office, also known as working capital funds, for funding?
        Secretary Bodman. The Department had plans to fund EIRs through the
    DOE Working Capital Fund (WCF), but was unable to implement this
    arrangement due to the continuing resolution in fiscal year 2007,
    Currently, the DOE Programs continue to provide funding for their
    respective EIRs directly to OECM.

        8. Senator Bill Nelson. Secretary Bodman, does the OECM still
    review NNSA projects?

        Secretary Bodman. Yes, DOE Order 413.3A, Program and Project
    Management for the Acquisition of Capital Assets, applies to NNSA
    capital asset projects having a Total Project Cost greater than or
    equal to $20 million. As required by this order, OECM still reviews
    applicable NNSA projects.

        9. Senator Bill Nelson. Secretary Bodman, when was that last time
    the Institute of Project Management reviewed the DOE project management
    process and are any future reviews scheduled?
        Secretary Bodman. To the best of the Department's knowledge, the
    Project Management Institute has not reviewed the DOE project
    management process and no reviews are planned. However, the National
    Research Council has reviewed project management at DOE several times,
    the last report being issued this year. Also, the Government
    Accountability Office has reviewed the Department's project management
    processes and issued a report in May 2007 (GAO-07-51S, Department of
    Energy: Consistent Application of Requirements Needed to Improve
    Project Management). The report found that, although the Department
    needs to improve project performance by ensuring that its project
    management requirements are consistently followed, DOE has improved its
    approach to project management by addressing weaknesses in key areas.
    The Department's OECM has ratcheted up its efforts to enforce
    compliance across the agency.

        10. Senator Bill Nelson. Secretary Bodman, will the OECM review
    projects to determine if the project includes and addresses all safety
    concerns including nuclear operating safety?
        Secretary Bodman. The Department is committed to performing all
    work so missions can be accomplished with adequate controls in place to
    protect the public, workers, and the environment. DOE's project
    management process is documented in DOE Order 413.3 A, Program and
    Project Management for the Acquisition of Capital Assets. The OECM
    recently updated this order to enhance the Department's integration of
    safety early into design and construction. One enhancement was to
    require a Technical Independent Project Review as part of Design
    Reviews for high-risk, high-hazard and Hazard Category 1, 2, and 3
    nuclear facilities. The order also requires that hazards be identified
    and safety be appropriately addressed throughout the life cycle of a
    project as part of the safety management systems for the project. As
    part of its EIRs, OECM assesses whether projects have reasonably
    considered and addressed all Nuclear Regulatory Commission (NRC) and
    Defense Nuclear Facilities Safety Board (DNFSB) issues. If not, the EIR
    team identifies the outstanding issue(s), ascertains when they will be
    resolved, and determines what risks they pose.

        11. Senator Bill Nelson. Secretary Bodman, how will the OECM and
    the DNFSB engage so that OECM is fully aware of all nuclear operating
    safety issues raised by the DNFSB?
        Secretary Bodman. The Department continues to enjoy a productive
    relationship with the Defense Nuclear Safety Board (DNFSB). As part of
    its EIRs, the OECM assesses whether Hazard Category 1, 2, and 3 nuclear
    facilities projects have reasonably considered and addressed all DNFSB
    issues. If not, the EIR team identifies the outstanding issue(s),
    ascertains when they will be resolved, and determines what risks they
    pose.
                                     ______

                  Questions Submitted by Senator Jeff Sessions

              CONTROLLING CONTRACTOR HEALTH CARE AND PENSION COSTS

        12. Senator Sessions. Secretary Bodman, last year, I supported an
    initiative you began, to try to control the costs for medical and
    pension benefits being provided by DOE contractors. The costs of these
    contractor benefits are born solely and entirely by DOE as a pass-
    through cost under DOE contracts. Analysis at that time indicated that
    the costs DOE was reimbursing for pension and medical expenses were
    higher than industry norms. Under substantial pressure from Members of
    Congress representing DOE sites, you suspended the effort to reform
    these costs reimbursements. Where does this effort to bring contractor
    costs for these benefits in line with industry averages now stand?
        Secretary Bodman. During the suspension of this initiative, we have
    been meeting with DOE stakeholders, including Members of Congress and
    other interested parties in an effort to seek their input and/or
    concerns as we consider alternatives to meeting the challenge posed by
    increasing costs and liabilities associated with contractor employee
    pension and medical benefits. In addition, on March 27, 2007, the
    Department published a Federal Register notice to seek public comments
    and/or recommendations on how DOE should address this challenge.
    Currently, we are reviewing over 400 comments in response to the
    Federal Register notice. These comments will be taken into
    consideration as the Department seeks to determine how to best balance
    its responsibility for funding important national missions while
    providing contractors sufficient flexibility to offer benefits that
    will both attract and retain qualified new workers and treat incumbent
    contractor employees and retirees and their beneficiaries fairly.

                       YUCCA MOUNTAIN NUCLEAR REPOSITORY

        13. Senator Sessions. Secretary Bodman, this subcommittee
    authorizes the defense funding which goes toward the development of the
    national high-level waste repository at Yucca Mountain. This defense
    funding, in the amount of about $300 million in fiscal year 2008, is
    added to the approximately $200 million in civilian funding from the
    electric bills of customers in areas with nuclear power plants. The
    disposal program, however, is well behind its statutory deadline of
    1998 for an operating repository. Why should electricity consumers and
    other citizens have confidence that the waste repository is on a path
    to opening eventually?
        Secretary Bodman. The administration is strongly committed to
    having a repository, which is vital to the Nation's energy and national
    security needs, operational as soon as possible. The Director of the
    DOE Office of Civilian Radioactive Waste Management has put into place
    an effective plan to submit a high-quality license application to the
    NRC on or before June 30, 2008, and to move forward with the licensing,
    construction and operation of the repository. To ensure that the
    repository can commence operations as soon as practicable, I urge
    Congress to pass the administration's proposed legislation which
    addresses many of the uncertainties beyond the Department's control
    that could significantly delay the receipt of an NRC construction
    authorization and the repository's opening.

        14. Senator Sessions. Secretary Bodman, what year does DOE project
    the repository will begin to accept the waste that is piling up around
    the Nation?
        Secretary Bodman. In fiscal year 2006 the Department released a
    ``best-achievable'' schedule for the start of repository operations in
    2017 which is contingent on a number of factors, including enactment of
    the administration's proposed legislative package, appropriations
    consistent with estimated costs, timely issuance of all necessary
    authorizations and permits, and the absence of litigation-related
    delays.

        15. Senator Sessions. Secretary Bodman, for the last 3 years, since
    fiscal year 2005, Congress has supported, on a bipartisan basis, the
    continued study of the RRW. DOE's budget for fiscal year 2008 requests
    funding of $88 million to continue design and cost studies. This year,
    outside critics and anti-nuclear groups are becoming very vocal against
    any continued study. I believe that my chairman, Senator Nelson, and I
    have worked together in the best spirit of bipartisanship on the RRW--
    to advance the RRW in a measured and thoughtful way, with careful study
    and deliberations. I hope we will continue to do so. Have you
    personally involved yourself in the evaluation of the RRW and does this
    program have your personal commitment and active support?
        Secretary Bodman. I have been briefed by the NNSA Administrator and
    his staff on the results of the RRW Feasibility Study. I agree with and
    support the Nuclear Weapons Council determination that the RRW should
    be pursued to sustain the Nation's nuclear weapons stockpile for the
    long-term without the need for underground nuclear testing. I also
    support the Council's decision to conduct a Phase 2A Design Definition
    and Cost study to develop the detailed cost, scope and schedule
    baseline for the RRW which is needed by NNSA, the DOD, and Congress in
    order to make informed decisions on whether and how to proceed to the
    engineering development phase.

        16. Senator Sessions. Secretary Bodman, why do you believe the RRW
    program is needed?
        Secretary Bodman. The RRW program is needed to assure long-term
    confidence in the reliability of the nuclear weapons stockpile. An RRW-
    based stockpile has the potential to significantly reduce the size of
    the country's nuclear stockpile while transforming the nuclear weapons
    complex into a smaller, more responsive enterprise.
        Specifically, the RRW program will enhance the security of nuclear
    weapons through the use of state-of-the-art technology to prevent
    unauthorized use by terrorists, rogue nations or criminal
    organizations; improve the safety of the stockpile through upgrades,
    such as the use of insensitive high explosives rather than conventional
    high explosives; help develop a more responsive nuclear weapons
    infrastructure by using replacement components and assemblies that are
    easier lo manufacture and maintain; exercise critical nuclear weapons
    design and production skills; enable a reduced stockpile size by
    increasing confidence in the infrastructure to produce weapons if and
    when they are needed; and decrease the likelihood that a nuclear test
    will be needed in the future to confirm weapon performance.

        [Whereupon, at 3:54 p.m., the subcommittee adjourned.]