    [Senate Hearing 111-860]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 111-860

       MILITARY CONSTRUCTION AND VETERANS AFFAIRS, AND RELATED AGENCIES
                      APPROPRIATIONS FOR FISCAL YEAR 2011

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

                                    HEARINGS

                                    before a

                              SUBCOMMITTEE OF THE

                COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                         ONE HUNDRED ELEVENTH CONGRESS

                                 SECOND SESSION

                                       on

                               H.R. 5822/S. 3615

      MAKING APPROPRIATIONS FOR MILITARY CONSTRUCTION, THE DEPARTMENT OF
       VETERANS AFFAIRS, AND RELATED AGENCIES FOR THE FISCAL YEAR ENDING
                   SEPTEMBER 30, 2011, AND FOR OTHER PURPOSES

                                   __________

                             Department of Defense
                         Department of Veterans Affairs

                                   __________

             Printed for the use of the Committee on Appropriations

      Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                                   index.html

                                   __________

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    54-983                    WASHINGTON : 2011
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                          COMMITTEE ON APPROPRIATIONS

                       DANIEL K. INOUYE, Hawaii, Chairman
    ROBERT C. BYRD, West Virginia        THAD COCHRAN, Mississippi
    PATRICK J. LEAHY, Vermont            CHRISTOPHER S. BOND, Missouri
    TOM HARKIN, Iowa                     MITCH McCONNELL, Kentucky
    BARBARA A. MIKULSKI, Maryland        RICHARD C. SHELBY, Alabama
    HERB KOHL, Wisconsin                 JUDD GREGG, New Hampshire
    PATTY MURRAY, Washington             ROBERT F. BENNETT, Utah
    BYRON L. DORGAN, North Dakota        KAY BAILEY HUTCHISON, Texas
    DIANNE FEINSTEIN, California         SAM BROWNBACK, Kansas
    RICHARD J. DURBIN, Illinois          LAMAR ALEXANDER, Tennessee
    TIM JOHNSON, South Dakota            SUSAN COLLINS, Maine
    MARY L. LANDRIEU, Louisiana          GEORGE V. VOINOVICH, Ohio
    JACK REED, Rhode Island              LISA MURKOWSKI, Alaska
    FRANK R. LAUTENBERG, New Jersey
    BEN NELSON, Nebraska
    MARK PRYOR, Arkansas
    JON TESTER, Montana
    ARLEN SPECTER, Pennsylvania

                        Charles J. Houy, Staff Director
                      Bruce Evans, Minority Staff Director
                                     ------

    Subcommittee on Military Construction and Veterans Affairs, and Related
                                    Agencies

                      TIM JOHNSON, South Dakota, Chairman
    DANIEL K. INOUYE, Hawaii             KAY BAILEY HUTCHISON, Texas
    MARY L. LANDRIEU, Louisiana          SAM BROWNBACK, Kansas
    ROBERT C. BYRD, West Virginia        MITCH McCONNELL, Kentucky
    PATTY MURRAY, Washington             SUSAN COLLINS, Maine
    JACK REED, Rhode Island              LISA MURKOWSKI, Alaska
    BEN NELSON, Nebraska                 THAD COCHRAN, Mississippi
    MARK PRYOR, Arkansas                   (ex officio)

                               Professional Staff

                                Christina Evans
                                 Chad Schulken
                              Andrew Vanlandingham
                           Dennis Balkham (Minority)
                             Ben Hammond (Minority)

                             Administrative Support

                                  Rachel Meyer
                             Katie Batte (Minority)

                                C O N T E N T S

                                  ----------

                            Tuesday, March 23, 2010

                                                                       Page

    Department of Defense:
        Office of the Secretary......................................     1
        Department of the Navy.......................................    35

                            Thursday, April 15, 2010

    Department of Veterans Affairs...................................    59

                            Tuesday, April 22, 2010

    Department of Defense:
        Department of the Army.......................................   109
        Department of the Air Force..................................   135

       MILITARY CONSTRUCTION AND VETERANS AFFAIRS, AND RELATED AGENCIES
                      APPROPRIATIONS FOR FISCAL YEAR 2011

                                  ----------

                            TUESDAY, MARCH 23, 2010

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room SD-124, Dirksen
    Senate Office Building, Hon. Tim Johnson (chairman) presiding.
        Present: Senators Johnson, Pryor, Hutchison, Collins, and
    Murkowski.

                             DEPARTMENT OF DEFENSE

                            Office of the Secretary

    STATEMENT OF HON. ROBERT F. HALE, UNDER SECRETARY OF
                DEFENSE (COMPTROLLER)
    ACCOMPANIED BY:
            DOROTHY ROBYN, DEPUTY UNDER SECRETARY OF DEFENSE (INSTALLATIONS
                AND ENVIRONMENT)
            DEREK MITCHELL, PRINCIPAL DEPUTY ASSISTANT SECRETARY FOR ASIAN
                AND PACIFIC SECURITY AFFAIRS

                    OPENING STATEMENT OF SENATOR TIM JOHNSON

        Senator Johnson. Good morning. This hearing will come to
    order. I welcome everyone to today's hearing to discuss the
    President's fiscal year 2011 budget request for military
    construction and family housing, as well as overseas
    contingency operations.
        We have two panels today. The first panel includes the DOD
    Comptroller, Mr. Bob Hale; Dr. Dorothy Robyn, Deputy Under
    Secretary for Installations and Environment; and Mr. Derek
    Mitchell, Principal Deputy Assistant Secretary for Asian and
    Pacific Security Affairs. Thank you all for coming.
        Our procedure is to have opening statements by the chairman
    and ranking member, followed by opening statements from our
    witnesses. I request that our members limit their questions to
    6-minute rounds.
        I apologize in advance to our witnesses, but I will have to
    leave in a few minutes for the White House for the bill signing
    of the healthcare legislation. I have asked my able ranking
    member, Senator Hutchison, to chair the hearing in my absence.
        The fiscal year 2011 Milcon request totals $18.75 billion,
    excluding overseas contingency funding. It addresses a number
    of major DOD policy initiatives, including the execution of the
    QDR recommendations, the completion of the 2005 BRAC round, the
    Marine Corps realignment to Guam, and the increased focus
    within the Department on renewable energy and energy security.
        On top of this, the budget also provides $1.8 billion in
    overseas contingency Milcon to support the war in Afghanistan.
    By any measure, this is a major undertaking. There are many
    moving pieces and many challenges to executing this request.
        I have a number of questions which I will submit for the
    record.
        Senator Hutchison, would you care to make an opening
    statement?

                   STATEMENT OF SENATOR KAY BAILEY HUTCHISON

        Senator Hutchison. Yes, Mr. Chairman. I apologize. We had
    the TSA nominee in my other committee where I am also ranking
    member. So that is why I am late. But I do have an opening
    statement because I have some great concerns.
        First of all, I want to say that I am pleased that we are
    close to finishing the BRAC commitments that we have made, and
    one thing that our committee has been very firm about is that
    BRAC be fully funded so that we can meet the deadline of 2011.
    And in the main, it looks like we will meet that deadline.
    There will be some slippage I know, but I am pleased about
    that.
        The concerns that I have are in the global defense posture.
    It seems to me that Congress has passed the Overseas Basing
    Commission, and the beginning of that was being implemented
    where we had the commitment to bring home as many troops as
    possible back to the United States, particularly from Germany
    and Korea where the training capabilities and the facilities
    were better addressed in the United States.
        Overall, the Milcon budget had significant reductions in
    each of the last 2 years, but the request before us cuts
    funding but adds more in Europe. And that is my big concern.
    The Quadrennial Defense Review recommends retaining four
    brigade combat teams in Europe, rather than the current
    stationing plan to reduce the number to two. I have raised this
    issue with the Secretary of Defense and the Army Chief of Staff
    because I am concerned that it will disrupt the commitment to
    return our forces to the United States that was announced
    several years ago. Approximately 70,000 was the number. We can
    provide better training, better quality of life for them and
    stability for their families.
        I am also concerned that it will disrupt the extensive
    military construction already in progress to take those two
    brigade combat teams that were planned in the Overseas Basing
    Commission. The sooner that we can get our service men and
    women and into the new state-of-the-art facilities, the sooner
    we will live up to our commitments to provide for them in a way
    that we should as a Nation. Our troops can deploy to any region
    of the world from the United States just as easily as they can
    from Europe and in some cases more so.
        The concern that I have too is with the increase of the
    building in Germany in particular. I will have a question about
    how much of that burden is going to be shared with the host
    country. Germany has not been forthcoming in the past in
    sharing expenses and they have higher quality requirements
    which make military construction more costly. Not counting the
    construction requirements that are specifically related to
    Afghanistan, our specified overseas Milcon request is $2
    billion. That is huge. Now you see $513 million of that are for
    Germany. This includes $186 million for Wiesbaden Army Base,
    four new barracks at Grafenwoehr for $75 million, a training
    facility. Those are just examples. As our services consolidated
    our forces in fewer facilities to save O&M costs, we have to
    build some facilities, but I am concerned about the amount that
    I am seeing and I want to know what is the sharing that is
    going to be anticipated.
        In addition, you have got in the budget $439 million for
    school construction, much of it overseas. I understand the
    overall plan calls for replacing or renovating 109 schools over
    5 years at a cost of over $4 billion. While I recognize that we
    have an obligation to provide quality schools for the children
    of our military personnel serving overseas, I am concerned that
    these requirements are not consistent with our future force
    requirements and posture. So I would like to have a little more
    specificity about those schools.
        And then there is the Guam relocation. We know that there
    is now a plan to relocate 8,000 marines from Okinawa to Guam to
    establish a joint base in Guam, and yet we are now seeing from
    the Environmental Protection Agency, as well as the Government
    of Guam, that they do not believe that their infrastructure
    will in any way be able to accommodate this kind of influx of
    the requirements for the building of this marine base in Guam.
    And there is even an EPA statement that says it is not ready
    and should not be done.
        And then you have got the relocation of the Guantanamo Bay
    detainees. The Department of Defense is requesting $350 million
    in the 2011 defense bill for an overseas contingency operations
    transfer fund to renovate the prison in Thompson, Illinois for
    the relocation of Guantanamo Bay detainees. All of this funding
    is included within the administration's defense bill request,
    but as I understand it, $150 million will go toward military
    construction to renovate the portion of the prison that would
    house the detainees. I am going to ask you to speak to this
    issue, Mr. Hale, because I will be interested to know why the
    military construction funds are not in the military
    construction request.
        I am concerned about this plan in general. We have an
    excellent facility in Guantanamo to house these detainees that
    was constructed at great expense. So I question the basis of
    this.
        So there are a lot of questions I have today, and these are
    just to highlight some of the issues. It may be that I am going
    to request more meetings on this, particularly in regards to
    building more facilities in Korea and Germany, which is exactly
    the opposite of what Congress passed a law to reduce rather
    than add, and at a time when NATO is not fulfilling its full
    responsibilities in the wars in Afghanistan and Iraq, which are
    wars against terrorist activities that affect all of the NATO
    countries--so I think there are some major issues here that are
    going to take more than maybe even one hearing. And I am very,
    very concerned, as I have stated.
        So thank you, Mr. Chairman, for holding the hearing, and I
    look forward to questioning the witnesses.
        Senator Johnson. Thank you, Senator Hutchison.
        Secretary Hale, Dr. Robyn, Mr. Mitchell, thank you again
    for appearing before our panel today and thank you all for all
    that you do on behalf of our Nation's military troops and their
    families.
        Your prepared statements will be placed in the record. So I
    ask you to summarize your remarks to allow adequate time for
    questions.
        Senator Hutchison, I will now turn the gavel over to you,
    and I thank you for chairing this hearing in my absence.
        Senator Hutchison [presiding]. Thank you, Mr. Chairman.
        Did you ask other members to make opening statements or did
    we----
        Senator Johnson. It is your option to ask other members.
        Senator Hutchison. Does anyone want to? Okay. Then I think
    we should go directly to questions.
        Since I have made an opening statement, I will ask my
    colleagues to go first on questions, after which I will have
    several questions.
        Senator Johnson. Their testimony should be first.
        Senator Hutchison. Oh, I am so sorry.
        Mr. Hale. I will keep it short.
        Senator Hutchison. Mr. Hale, why do you not go first? Thank
    you very much.

                    SUMMARY STATEMENT OF HON. ROBERT F. HALE

        Mr. Hale. Thank you. Members of the subcommittee, thank you
    for the opportunity to discuss the military construction
    portion of the fiscal year 2011 budget.
        First off, let me say on behalf of all of us in DOD, I want
    to thank you for your support for the men and women in the
    armed forces. We could not accomplish our mission without your
    assistance, and it is appreciated.
        I submitted a statement for the record. Let me summarize it
    briefly.
        For 2011, the President's base budget asks for $549 billion
    in discretionary budget authority, about a 1.8 percent increase
    after adjustment for inflation. Over the next 5 years, the
    growth average is 1 percent a year.
        The budget contains some vital reforms that I will mention
    in a minute, and it builds on the conclusions of the
    Quadrennial Defense Review.
        The budget furthers the Secretary's three overarching
    goals. First, it reaffirms our commitment to take care of the
    all-volunteer force, which is our highest priority.
        Second, it continues to rebalance this force to focus on
    today's wars, while continuing to provide basic capability for
    the future.
        And third, our request reforms how and what we buy by
    overhauling procurement, acquisition, and contracting, and
    includes termination of seven programs that are performing
    poorly or are no longer needed, including the C-17 and the
    alternate engine for the Joint Strike Fighter.
        For military construction and family housing, our request
    is $18.7 billion. That is about 20 percent less than 2010, but
    the reduction is due to a $5.2 billion decrease in funding for
    base realignment and closure, BRAC. As you know, 2011 is the
    final year of implementation, and most of the major capital
    investments have occurred. If you exclude BRAC and family
    housing, our Milcon request is actually $1.1 billion, or 8.4
    percent higher than in 2010, which is one of the fastest
    growing accounts in our budget. The request supports facilities
    for the new Army Modular Force units, the relocation of marines
    from Okinawa to Guam, and the recapitalization of DOD schools.
        Our family housing request is $1.8 billion, which is 19
    percent, or $436 million less than last year, but we believe we
    have met all of our high priority requirements. Congress added
    $300 million to the DOD budget for the expanded homeowners
    assistance program in 2010. The omission of those funds in the
    2011 request accounts for most of the decline in that area of
    the budget.
        In addition to the base budget, our 2011 budget request
    includes $159.3 billion for overseas contingency operations,
    and that includes $1.3 billion for military construction for
    Afghanistan. Additionally, we are requesting for $33 billion
    for a supplemental in 2010 to cover the cost of deploying an
    additional 30,000 troops the President has ordered to
    Afghanistan. That includes half a billion for military
    construction in Afghanistan.
        Last, I will briefly mention the $7.4 billion the
    Department received last year under the American Recovery and
    Reinvestment Act, better known as the stimulus bill, which is
    allowing us to execute 4,400 projects, including a number of
    major military construction projects. As of February 17, 2010,
    the first anniversary of the stimulus bill, we had obligated
    about 60 percent of the funds received.
        Mr. Chairman, we believe that the 2011 budget request is
    the right one for our time. It asks for the minimum resources
    we need to meet our critical national security objectives, and
    it includes what I believe is a strong military construction
    program. I urge your support.
        Again, I want to thank you for your support for the men and
    women in the military.

                               PREPARED STATEMENT

        Dr. Robyn has a statement. Mr. Mitchell is here to help us
    answer questions on Guam, so he does not have a statement. So
    after Dr. Robyn finishes, we will be glad to turn to questions.
        [The statement follows:]

                   Prepared Statement of Hon. Robert F. Hale

        Mr. Chairman, members of the committee, thank you for the
    opportunity to discuss the Military Construction portion of the fiscal
    year 2011 budget request for the Department of Defense.
        On behalf of all of us at DOD, I want to express our gratitude to
    the Congress for continued support of America's Armed Forces. Thanks to
    you, they have the resources to carry out their missions and to ensure
    the security of the United States.
        To set the stage this morning, I would like to provide a brief
    overview of our proposed budget and the amount we are asking for
    Military Construction. Dr. Robyn, Deputy Under Secretary for
    Installations and Environment, will follow with details on our Military
    Construction proposals.

                                  BASE BUDGET

        Mr. Chairman, the President's base budget for fiscal year 2011
    requests $549 billion in discretionary authority. That is an increase
    of more than $18 billion or 3.4 percent over the enacted level in
    fiscal year 2010. Taking inflation into account, the real growth in
    this request is 1.8 percent. Over the 5 years from fiscal year 2010
    through fiscal year 2015, real growth averages 1.0 percent per year.
        This growth reflects the Administration's commitment to the modest
    real growth necessary to equip and sustain a military at war. Before
    making this proposal, the President carefully considered and balanced
    our national security needs with our economic security, taking into
    account the deficit.
        The base budget continues the vital reforms that were introduced in
    the present fiscal year, including our commitment to allocate defense
    dollars more wisely and to reform DOD's processes. It also builds on
    the conclusions of the 2010 Quadrennial Defense Review, which
    established strategic priorities and identified key areas for needed
    investment.
        In the process, the fiscal year 2011 budget reinforces and supports
    the three major institutional priorities laid down by Secretary Gates
    for the Department:
      --First, it reaffirms our commitment to take care of the all-
            volunteer force, which the Secretary considers our greatest
            strategic asset.
      --Second, the proposed budget continues to rebalance the Department's
            programs to prevail in current conflicts by continuing
            increases in Special Operations forces, providing more rotary-
            wing capability, and increasing intelligence, surveillance and
            reconnaissance.
        Rebalancing also means maintaining and enhancing capabilities for
            future conflicts by--among other things--providing funds for
            continued development of the Joint Strike Fighter and
            procurement of 42 aircraft, development of a new aerial
            refueling tanker, buying 10 new ships, improvements in Army
            ground forces, missile defense enhancements, and a new U.S.
            Cyber Command.
      --And third, the fiscal year 2011 budget request reforms how and what
            we buy, by promoting a fundamental overhaul of our approach to
            procurement, acquisition, and contracting.
        Specifically, this budget proposes to end seven programs that are
    either performing poorly or are no longer needed, including the C-17
    aircraft and the JSF alternate engine. The budget also continues our
    commitments to reform acquisition processes, increase efficiency
    through selective in-sourcing of work now performed by contractors, and
    slow the growth in healthcare costs while continuing to provide high-
    quality healthcare services.

                    MILITARY CONSTRUCTION AND FAMILY HOUSING

        The Military Construction and Family Housing portion of this
    request supports these three budget objectives. We are asking for $18.7
    billion for Military Construction and Family Housing, a reduction of
    almost 20 percent compared with the enacted level in fiscal year 2010.
        This change is largely due to a $5.2 billion decrease in funding
    for Base Realignment and Closure (BRAC). By law, fiscal year 2011 is
    the final year to implement BRAC, and as a result, most major capital
    investments have already been made.
        Excluding BRAC and Family Housing, the fiscal year 2011 Milcon
    request is actually $1.1 billion higher than the fiscal year 2010
    enacted amount, an increase of about 8.4 percent. This increase is
    associated with facilities in support of new Army Modular Force units,
    the relocation of 8,000 marines from Okinawa to Guam, and
    recapitalization of schools under the DOD Education Activity (DODEA).
        The total fiscal year 2011 budget request for Family Housing is
    $1.8 billion, which is about 19 percent or $436 million less than the
    fiscal year 2010 enacted amount. Included are funds for new housing,
    improvements to existing housing units, operation and maintenance of
    government-owned housing, leasing, the Military Housing Privatization
    Initiative (MHPI) program, and the Homeowners Assistance Program (HAP).
        HAP assists military and civilian personnel who were adversely
    affected by the downturn in the housing market and who are also facing
    a necessary move. In fiscal year 2010 Congress added $300 million to
    the DOD budget to fund HAP expansion, and its omission in fiscal year
    2011 accounts for most of the decrease in the Family Housing budget for
    next year.

                        OVERSEAS CONTINGENCY OPERATIONS

        In addition to the base budget, our fiscal year 2011 request seeks
    funds to support overseas contingency operations (OCO), largely in
    Afghanistan and Iraq. We have also requested supplemental
    appropriations of $33 billion in fiscal year 2010 to cover the costs of
    the additional 30,000 troops that President Obama ordered deployed to
    Afghanistan. We are hopeful that Congress will approve that request by
    spring.
        Our fiscal year 2011 OCO request is $159.3 billion. This request
    provides our troops with what they need to carry out their mission. It
    also supports a responsible drawdown of U.S. forces in Iraq and a
    stronger force in Afghanistan.
        The proposed OCO budget for fiscal year 2011 includes $1.2 billion
    for Military Construction. The requested amount will be spent in
    Afghanistan. Given the limited pre-existing infrastructure for our
    troops in that country, it is necessary to construct facilities to
    sustain, protect, and house them. Accordingly, this request includes
    operational facilities, such as runways and parking aprons, as well as
    associated support facilities, such as utilities, roads, housing,
    environmental projects, and dining facilities.

                     AMERICAN RECOVERY AND REINVESTMENT ACT

        Little more than a year ago, the Department received $7.4 billion
    in Defense-related funding under the American Recovery and Reinvestment
    Act (ARRA). That amount included nearly $4.3 billion for the
    sustainment and restoration and modernization of facilities, $2.2
    billion for military construction, $0.1 billion for the Energy
    Conservation Investment Program (ECIP), $0.3 billion for Research,
    Development, Test, and Evaluation (RDT&E), and nearly $0.6 billion for
    the Homeowners Assistance Program.
        Through this funding we will be able to execute over 4,400 projects
    in the 50 States, the District of Columbia, Guam, and Puerto Rico.
    These projects will improve the facilities where our military and
    civilian personnel work and live, enhance energy efficiency in the
    recapitalization and construction of facilities, and generate needed
    jobs to help stimulate the Nation's economy.
        As of February 17, 2010--the first anniversary of the Recovery
    Act--the Department had obligated approximately $4.2 billion (more than
    57 percent) of the funds received for more than 3,700 projects. These
    projects will not only stimulate the economy; they will also improve
    the quality of life of our Service Members and their families.
    Additionally, through the funds made available for the Housing
    Assistance Program, the Department has already been able to pay more
    than 600 claims to assist military and civilian personnel and expects
    to pay many more.
        In military construction, 97 of 117 projects have been awarded. The
    remaining 20 projects involve $1.7 billion of unobligated funds,
    including $1.2 billion for two hospitals that are scheduled for award
    near the end of the fiscal year--one at Camp Pendleton, California, and
    the other at Fort Hood, Texas.

                                   CONCLUSION

        I believe that the fiscal year 2011 budget request represents a
    prudent request that asks for the minimum resources we need to meet our
    critical national security objectives. Our budget supports a strong
    Military Construction program. I urge your support for DOD's fiscal
    year 2011 budget request.
        Lastly, Mr. Chairman, I want to thank you and the members of the
    committee once again for your strong support of the men and women of
    the Department of Defense. We are very grateful.

                     SUMMARY STATEMENT OF DR. DOROTHY ROBYN

        Dr. Robyn. Thank you. Thank you, Ranking Member Hutchison,
    Senator Collins.
        Let me use my brief time to address two of the issues that
    you raised, Senator Hutchison, in your opening statement: Guam
    and BRAC.
        First, Guam. And Derek Mitchell can provide even more
    refined answers than I can. But let me say that I have been
    deeply involved in the Department's efforts to move 8,000
    marines and their families from Okinawa to Guam. Like any
    international effort this large and complex, the buildup on
    Guam faces an array of challenges, but no single realignment
    has a higher profile within the Department. The Deputy
    Secretary, Bill Lynn, is personally overseeing the effort.
        Our fiscal year 2011 budget request includes $452 million
    for military construction on Guam. These projects will yield
    long-term benefits for all the military forces on Guam. They
    will also demonstrate the Department's commitment to working
    with the Governor of Guam whose strong support for the buildup
    has been absolutely critical to our effort.
        I appreciate the support that the subcommittee has given us
    in the past, and look forward to working with you.
        Let me just say with respect to the EPA evaluation of the
    draft environmental impact statement, it is true that Guam's
    infrastructure now cannot support a buildup that we anticipate,
    but we knew that all along and the Federal Government is
    committed to working with Guam--the Federal Government as a
    whole, the civilian agencies, as well as DOD, to working with
    Guam to improve and expand its infrastructure to support the
    buildup. And we believe and I think the Governor believes that
    this will be a win-win, good for Guam and good for the U.S.
    military.
        Second, let me say a little bit about the implementation of
    BRAC. My office oversaw the process that resulted in the
    recommendations that went to the BRAC commission, and we
    oversee the implementation of BRAC as it is carried out by the
    services. Senator, you said that there would be some slippage.
    I hope there will not be slippage. We have 220 actions; 28 of
    them are completed. We are on a very tight timeline. Thirty of
    the 222 actions have at least one construction project that
    completes within 90 days of the deadline, September 5, 2011.
    And of those, six are of particular concern, but we hope that
    they all come in on schedule.
        Last week, my staff and I briefed your staff on the status
    of those six most challenging actions. We are working closely
    with the services on those, and we pledge to keep your staff
    regularly informed on the status of those. So we are committed
    to bringing those in on time. The Department has never missed a
    BRAC deadline in four rounds, and I do not want to break that
    perfect record.

                               PREPARED STATEMENT

        Let me also, with respect to BRAC, just highlight the
    success of joint basing, which was one component of BRAC 2005.
    When this BRAC round started, there were those who were deeply
    opposed to joint basing. However, it received senior attention
    and support from you all, and we have moved forward
    successfully. I am pleased to say we are no longer
    ``implementing'' joint basing. We are now ``operating'' joint
    bases.
        With that, let me conclude, and I look forward to taking
    your questions.
        [The statement follows:]

                    Prepared Statement of Dr. Dorothy Robyn

        Chairman Johnson, Senator Hutchison, and distinguished members of
    the subcommittee: Thank you for the opportunity to present the
    President's fiscal year 2011 budget request for the Department of
    Defense programs that support our installations.
        Installations are the military's infrastructure backbone--the
    platform from which our soldiers, sailors, airmen, and marines
    accomplish their missions. Installations have long supported the
    maintenance and deployment of weapons systems and the training and
    mobilization of combat forces. Increasingly, they have an even more
    direct link to combat operations, by providing ``reachback'' support.
    For example, we operate Predator drones in Afghanistan from a facility
    in Nevada and analyze battlefield intelligence at data centers in the
    United States. Our installations are also becoming more important as a
    staging platform for homeland defense missions.
        Installations affect not just our mission effectiveness but the
    very quality of life that our service members and their families enjoy.
    Families' satisfaction with the most critical services they receive--
    housing, healthcare, childcare, on-base education--is linked to the
    quality and condition of our buildings and facilities.
        The Department must manage its installations--the natural as well
    as the built environment--efficiently and effectively. This is a major
    challenge. The Department's 507 permanent installations comprise more
    than 300,000 buildings and 200,000 other structures--everything from
    bridges to flagpoles--and have an estimated replacement value of more
    than $800 billion. These installations are located on some 5,000 sites
    and occupy 28 million acres of land here in the United States and
    overseas. These lands are home to archaeological and sacred sites, old-
    growth forests and more than 300 threatened and endangered species.
        Today, I will focus on the key elements of the budget that support
    our installations: Military Construction, including Overseas
    Contingency Operations and International Basing; Base Realignment and
    Closure; and Family Housing. I will also discuss our Facilities
    Sustainment, Restoration and Modernization programs. Finally, I will
    describe our strategy for improved management of energy at our
    installations.

                 MILITARY CONSTRUCTION, BRAC AND FAMILY HOUSING

        The fiscal year 2011 Military Construction (Milcon) and Family
    Housing appropriations request totals more than $18.7 billion, a
    decrease of approximately $4.6 billion from the fiscal year 2010
    enacted level. This decrease primarily reflects the decline in the
    level of investment needed for BRAC 2005 as we approach the statutory
    deadline for completion (September 2011). This budget request will
    allow the Department to respond rapidly to warfighter requirements,
    enhance mission readiness and provide essential services for its
    personnel and their families.

             COMPARISON OF MILITARY CONSTRUCTION AND FAMILY HOUSING
                            [In millions of dollars]
    ------------------------------------------------------------------------
                                                Fiscal year     Fiscal year
                                               2010 enacted   2011 requested
    ------------------------------------------------------------------------
    Military Construction...................        12,545.8        13,705.7
    Base Realignment and Closure IV.........           496.7           360.5
    Base Realignment and Closure 2005.......         7,455.5         2,354.3
    Family Housing Construction/Improvements           488.8           356.8
    Family Housing Operations & Maintenance.         1,444.1         1,448.7
    Chemical Demilitarization...............           151.5           125.0
    Family Housing Improvement Fund.........             2.6             1.1
    Energy Conservation Investment Program..           174.2           120.0
    NATO Security Investment Program........           197.4           258.9
    Homeowners Assistance Program...........           323.2            16.5
                                             -------------------------------
          TOTAL.............................        23,279.8        18,747.5
    ------------------------------------------------------------------------

                             MILITARY CONSTRUCTION

        Our request for ``pure'' military construction (i.e., exclusive of
    BRAC and Family Housing) is $13.7 billion. This is a $1.2 billion
    increase over last year's enacted level ($12.5 billion). Let me
    highlight three areas where we focus our fiscal year 2011 Milcon budget
    request.
        First and most important, the budget request supports operational
    mission requirements. Milcon is key to initiatives such as Grow the
    Force and Global Defense Posture realignment, which require the
    synchronized movement of troops and equipment, as well as to the
    fielding of modernized and transformational weapon systems. Our budget
    request includes training and support facilities to accommodate the
    increases in the Army and Marine Corps endstrength; initial funding for
    the new and improved infrastructure needed to relocate 8,000 marines
    and their dependents from Okinawa to Guam; support for the bed down of
    the Joint Strike Fighter; improved and expanded communications and
    intelligence capabilities for Special Operations Forces; and fuel
    distribution facilities for the Defense Logistics Agency.
        Second, the President's budget request initiates a major
    recapitalization of our DOD-dependent schools here in the United States
    and overseas. Fully 134 of the 192 DOD-dependent schools are in poor or
    failing physical condition--the result of longstanding underinvestment
    by the Department. Many of these schools have simply lasted beyond
    their expected service life. Others are improperly configured, lacking
    in essential capabilities, or reliant on temporary structures. The
    fiscal year 2011 budget request includes $439 million to repair or
    replace 10 of these schools. This represents the first phase of a 5-
    year plan to recapitalize all 134 inadequate schools.
        Third, the fiscal year 2011 budget request includes more than $1
    billion to upgrade our medical infrastructure. By modernizing our
    hospitals and related facilities, we can improve healthcare delivery
    for our service members and their families, and enhance our efforts to
    recruit and retain personnel. The fiscal year 2011 request provides
    funds for our top two priorities: the replacement of the Naval Hospital
    in Guam and the Ambulatory Care Center at Lackland Air Force Base,
    Texas. It also allows us to continue improving the chemical/biological
    defense facilities that are conducting such vital work.

                        OVERSEAS CONTINGENCY OPERATIONS

        Military construction serves as a key enabler in Overseas
    Contingency Operations (OCO), by providing the facilities that directly
    support military activity. Our fiscal year 2011 budget request includes
    $1.3 billion for Milcon necessary to support the new strategy for
    counterinsurgency and increased force levels for ongoing OCO in the
    U.S. Central Command's area of responsibility. Specifically, our fiscal
    year 2011 budget request expands the logistical and facilities backbone
    needed to increase our operational capability, replaces expeditionary
    facilities at the end of their lifecycle, consolidates functions and
    facilities, and supports Special Operations Forces. These additional
    operational facilities will provide support for tactical airlift;
    airborne intelligence, surveillance and reconnaissance; and additional
    fuel, storage, and cargo handling and distribution capability at
    critical locations. The request also provides for replacement of
    temporary housing, dining facilities and other basic infrastructure.

                              INTERNATIONAL BASING

        To project power globally, the Department must have the right mix
    of military forces and facility infrastructure at strategic locations.
    We are undergoing a global re-stationing, both to strengthen our
    forward military presence and to transform overseas legacy forces, cold
    war basing structures and host-nation relationships into a flexible
    network of capabilities to which we and our allies and partners have
    shared access.
        My office works closely with the Joint Staff and other Defense
    organizations to ensure that our overseas base structure supports the
    needed range of strategic missions across all theaters. While our work
    on overseas basing has traditionally focused primarily on the cost and
    engineering aspects of military construction and sustainment/
    recapitalization, we have recently taken on a broader role in support
    of emerging global posture initiatives: Increasingly, we provide
    analytic input to strategic discussions, by evaluating existing
    infrastructure capacity relative to emerging mission requirements.
        Our goal is to ensure that decisions reflect joint planning and
    rigorous analysis that integrates requirements across all of the
    Services. Current focus areas include: providing guidance and
    monitoring in support of the Army's consolidation of command and
    control activities in Weisbaden, Germany; analysis and evaluation of
    options for full recapitalization of the Landstuhl Regional Medical
    Center in Germany; and analysis and support for efforts to relocate
    more than 8,000 marines and their dependents from Okinawa to Guam.
    Rebasing Marines From Okinawa to Guam
        The realignment of marines from Okinawa to Guam, which is perhaps
    the most significant change in our force posture in Asia in decades,
    will further several strategic goals. First, it will strengthen our
    alliance with Japan by resolving long-standing problems with our
    presence in Okinawa. Second, it will ensure the continued long-term
    presence of U.S. forces in Japan and in the Western Pacific. Third, by
    making better use of Guam's strategic advantages, this realignment will
    more effectively array U.S. forces for the complex and evolving
    security environment in Asia.
        The political situation in Japan remains extremely delicate and the
    stakes are high. The U.S. Government is unlikely to get another
    opportunity to craft a strategic realignment that not only enhances our
    regional force posture but also incorporates more than $6 billion of
    Japanese financing. The Government of Japan has undergone a transition
    with the creation of the Democratic Party of Japan (DPJ)-led government
    in September 2009. The DPJ leadership, working with coalition partners,
    has initiated a process to review the Realignment Roadmap before
    endorsing the agreement in full, which is expected to happen in May
    2010. The U.S. Government remains committed to successful
    implementation of the Realignment Roadmap because it provides a needed
    solution to critical strategic challenges to the long-term presence of
    U.S. military capabilities in Japan and the Asia-Pacific region.
        The fiscal year 2011 President's Budget request includes $452
    million to support the relocation of marines from Okinawa to Guam. This
    includes projects to upgrade the wharf, provide utilities, ramp and
    roadway improvements, and carry out site preparation and utilities
    construction for the Marines' main cantonment area. These projects will
    yield long-term benefits for all the military forces on Guam. They will
    also demonstrate the Department's commitment to working with the
    Governor of Guam, whose strong support for the relocation can have a
    significant impact on Guam's population.
        In support of the relocation, the Department released the Draft
    Environmental Impact Statement (DEIS) on November 20, 2009, for public
    review. In addition to the analysis for rebasing of the Marines, the
    DEIS also includes analysis for construction of a new deep-draft wharf
    with shore-side infrastructure to support a transient nuclear-powered
    aircraft carrier, and facilities and infrastructure to support
    establishment and operation of an Army Missile Defense Task Force. The
    public comment period for the DEIS ended February 17, 2010. The
    Department is working with the Council on Environmental Quality, the
    Environmental Protection Agency and other resource agencies to address
    the concerns that were raised by the Federal agencies and the public.
        To address challenges regarding the realignment and to provide the
    appropriate oversight, the Department last year established the Guam
    Oversight Council (GOC), chaired by the Deputy Secretary of Defense.
    The GOC meets regularly to validate requirements, identify and resolve
    issues, provide resource guidance and clarify governance structures.
    Initial challenges taken up by the GOC include the aggressive timeline
    for completion of the realignment of marines from Okinawa to Guam;
    safety of the Futenma Replacement Facility in Okinawa; adequacy of
    training in the Pacific; strategic, operational, and logistic
    implications of posture changes in the Pacific; and successful
    partnership with the Government of Guam.

                          BASE REALIGNMENT AND CLOSURE

        Domestic basing is no less important than international basing, and
    we rely heavily on the Base Realignment and Closure (BRAC) process to
    adapt and improve that basing structure. We are entering our sixth and
    final year of implementation of BRAC 2005, the largest BRAC round
    undertaken by the Department. BRAC 2005 has been a significant engine
    for the recapitalization of our enduring military facilities. By the
    end date (September 15, 2011), the Department will have invested $24.7
    billion in military construction to enhance capabilities and another
    $10.4 billion to move personnel and equipment, outfit facilities, and
    carry out environmental clean-up. These investments will generate
    nearly $4 billion in annual savings beginning in fiscal year 2012. The
    DOD components have implemented BRAC 2005 conscientiously and
    transparently, according to a well-defined process. The Department
    continues to monitor the process closely to ensure that we are meeting
    our legal obligations. To date, 28 BRAC 2005 recommendations have been
    certified as completed.
        The fiscal year 2011 President's Budget includes $2.4 billion for
    BRAC 2005, which fully funds the investments needed to complete
    implementation. This represents a $5.1 billion decrease from the fiscal
    year 2010 enacted level for BRAC 2005. The reduction in funding is due
    primarily to a decrease in construction projects as we near the
    September 2011 completion date. To support continued property disposal
    actions at Prior-BRAC round sites, the fiscal year 2011 budget request
    includes $360.5 million, a decrease of $136 million from the fiscal
    year 2010 enacted level.
        Environmental cleanup at BRAC locations is essential in putting
    unneeded property back in the hands of local communities. The total
    BRAC environmental budget request for fiscal year 2011 is $445 million
    ($108 million for BRAC 2005 sites and $337 million for Prior-BRAC round
    sites). These funds will help us continue to meet stakeholder
    expectations and complete cleanup at an additional 154 sites impacted
    by BRAC decisions. Although this request represents a decrease of $109
    million over the fiscal year 2010 request, the reasons for the drop are
    positive. Specifically, the decrease is due to (a) contract
    efficiencies, such as those achieved through performance-based
    acquisition and competitive bidding, and (b) bid cost savings--a silver
    lining in the economic downturn. In addition, as the Military
    Departments have refined their characterization of munitions sites,
    they have found that fewer acres will require cleanup, which has
    lowered projected costs.

               COMPARISON OF BASE REALIGNMENT AND CLOSURE FUNDING
                            [In millions of dollars]
    ------------------------------------------------------------------------
                                                Fiscal year     Fiscal year
                                               2010 enacted   2011 requested
    ------------------------------------------------------------------------
    Base Realignment and Closure IV.........           496.7           360.5
    Base Realignment and Closure 2005.......         7,455.5         2,354.3
                                             -------------------------------
          TOTAL.............................         7,952.2         2,714.8
    ------------------------------------------------------------------------

        Despite our progress and the significant investment we have made,
    the Department has been perceived as ignoring the impacts of its
    actions, particularly in some communities that are experiencing
    significant growth as a result of BRAC 2005 consolidation. One area
    where growth can have an adverse impact is local transportation.
    Transportation impacts have been and will continue to be mitigated
    through the application of our authority and funding under the Defense
    Access Road (DAR) program. The criteria used to determine whether a
    project qualifies under DAR are limited, however. In particular, they
    may not adequately address the scenario in which a defense action
    causes a significant increase in traffic congestion, as may occur in
    one or more cases as a result of BRAC 2005 consolidation.
        To address this and related issues, the National Academy of
    Sciences is undertaking a BRAC Transportation Improvements Study as
    required by the fiscal year 2010 Military Construction and Veterans
    Affairs and Related Agencies Consolidated Appropriations. A blue-ribbon
    panel named by the National Academy's Transportation Research Board
    will evaluate the DAR criteria and assess the funding of transportation
    improvements associated with the BRAC 2005 program. We hope to receive
    an interim report in May of this year.
        One of the most important initiatives with a basis in BRAC 2005 is
    the consolidation and realignment of medical care delivery in the
    National Capitol Region (NCR), with its focus on transforming medical
    care through a joint delivery system. As I recently testified, this
    extraordinarily complex undertaking will deliver major benefits that
    would not have been possible without BRAC. Moreover, its successful
    completion is dependent on the strict discipline that the BRAC process
    provides. The construction now underway represents a balanced and
    reasonable approach to combining the functions of the old Walter Reed
    Army Medical Center into the new National Military Medical Center at
    Bethesda, Maryland. The result will be a medical delivery platform far
    superior to what we have now--and one on which we can continue to
    build.
        Another BRAC 2005 action that my office has championed is the
    consolidation of 26 installations into 12 joint bases. At each joint
    base, a supporting Service Component provides installation leadership
    for one or more supported Service Components. By consolidating
    installation management and delivery of installation support, joint
    bases will be able to provide more efficient and effective support for
    the overall military mission.
        Our joint bases represent realigned, reconfigured national military
    assets for the joint teams they serve. The first five joint bases
    reached full operational capability on October 1, 2009. The remaining
    seven joint bases reached initial operational capability on January 31,
    2010, and are on their way to full operational capability this coming
    October. We are no longer ``implementing joint basing.'' We are now
    ``operating joint bases.''
        I had the opportunity to meet personally with most of the joint
    base commanders in January, and I am encouraged by their can-do spirit
    and dedication to providing excellent installation support to the joint
    teams at each base. Additionally, I have had the opportunity to tour
    two of our joint bases recently: Joint Region Marianas on Guam and
    Joint Expeditionary Base Little Creek-Fort Story in Virginia. Having
    seen firsthand the extraordinary work they are doing, I have confidence
    that our joint base commanders will achieve efficiencies and other
    benefits as their installation support organizations mature.

                          FAMILY HOUSING AND BARRACKS

        Housing is key to quality of life--in the military no less than in
    the civilian world. The fiscal year 2011 President's Budget request
    includes $1.8 billion for Family Housing. This is a decrease of $436
    million from the fiscal year 2010 enacted level, which largely reflects
    the maturation of our Military Housing Privatization Initiative. Our
    request provides for the continued reduction of inadequate units; for
    operations and maintenance of government-owned housing; and for the
    privatization of more than 500 family housing units, most of them to
    support the Department's Grow the Force initiative.
        The Services have increasingly relied on privatization to address
    the oftentimes poor condition of military-owned housing and the
    shortage of affordable private rental housing available to military
    families. In my view, housing privatization is the single most
    effective reform my office has carried out.
        Privatization allows the Military Services to partner with the
    private sector to generate housing built to market standards. It is
    extremely cost effective. To date, the Military Services have leveraged
    DOD housing dollars by a factor of 10 to 1: $2.7 billion in Federal
    investments have generated $27 billion in privatized housing
    development at Defense installations. The privatized housing is also of
    high quality and often more appealing to young families than what the
    military construction process would produce. Moreover, the private
    owners have an incentive to maintain quality because they are
    responsible for maintenance and operation, including necessary
    recapitalization, during the full 50 years of the contract.

                          COMPARISON OF FAMILY HOUSING
                            [In millions of dollars]
    ------------------------------------------------------------------------
                                                Fiscal year     Fiscal year
                                               2010 enacted   2011 requested
    ------------------------------------------------------------------------
    Family Housing Construction/Improvements           488.7           356.8
    Family Housing Operations & Maintenance.         1,444.0         1,449.0
    Family Housing Improvement Fund.........             2.6             1.1
    Homeowners Assistance Program...........           323.0            16.0
                                             -------------------------------
          TOTAL.............................         2,258.3         1,822.9
    ------------------------------------------------------------------------

        The fiscal year 2011 President's Budget request also includes
    funding to reduce inadequate (non-privatized) family housing in the
    United States and at enduring locations overseas. The budget includes
    $34 million for the Army to construct 64 family housing units in
    Baumholder, Germany, and $37 million for the Navy to replace 71 units
    at Naval Station Guantanamo Bay, Cuba.
        The Department is committed to improving housing for its
    unaccompanied Service members, not just its families. The fiscal year
    2011 President's Budget includes $2.3 billion for 57 construction and
    renovation projects that will improve living conditions for
    approximately 17,000 unaccompanied personnel. The Army has also used
    its privatization authorities to improve unaccompanied housing.
    Bachelor officer quarters and senior enlisted bachelor quarters have
    been added to existing family housing privatization projects at Fort
    Bragg, North Carolina; Fort Stewart, Georgia; Fort Drum, New York; and
    Fort Irwin, California. A fifth project is planned soon at Fort Bliss,
    Texas.
        The Navy, too, has used privatization as a tool to improve
    unaccompanied housing--specifically by bringing shipboard junior
    enlisted sailors ashore using a special pilot authority in the fiscal
    year 2003 National Defense Authorization Act (10 U.S.C. 2881a). The
    first pilot project was awarded in December 2006 at San Diego,
    California, and the second was awarded in December 2007 at Hampton
    Roads, Virginia. Both projects have demonstrated that, with authority
    to provide partial Basic Allowance for Housing to single service
    members, privatizing single, junior enlisted personnel housing is more
    cost effective than the traditional Government-owned barracks model.

                         HOMEOWNERS ASSISTANCE PROGRAM

        The Homeowners Assistance Program (HAP) represents a very different
    type of program but one no less important to the quality of life of
    those who qualify. Since 1966, HAP has provided financial assistance to
    military personnel and DOD civilians at locations where home values
    decreased as a result of Defense action. The fiscal year 2011
    President's Budget request includes $17 million for HAP.
        In February 2009, Congress provided $555 million in the American
    Recovery and Reinvestment Act (Recovery Act) to expand HAP to address
    unique economic pressures faced by military personnel who are required
    to relocate during adverse housing market conditions. Congress added
    another $300 million for HAP in the Consolidated Appropriations Act for
    2010.
        HAP seeks to minimize the amount of financial harm--including risk
    of foreclosure, credit damage or bankruptcy--that service member and
    civilian beneficiaries experience when they are compelled to move. As
    of March 3, 2010, HAP has assisted 771 homeowners at a program cost of
    $84 million. Another 4,652 homeowners are currently eligible.

                  FACILITIES SUSTAINMENT AND RECAPITALIZATION

        In addition to investing in new construction, we must maintain,
    repair, and recapitalize our existing facilities. The Department's
    Sustainment and Recapitalization programs strive to keep our inventory
    of facilities in good working order and mission-capable. By providing a
    consistent level of quality in our facilities, we can raise the
    productivity of our personnel and improve their quality of life. The
    fiscal year 2011 budget request includes $9.0 billion for sustainment
    and $4.6 billion for recapitalization (restoration and modernization)
    of our facilities.

                 COMPARISON OF SUSTAINMENT AND RECAPITALIZATION
                            [In millions of dollars]
    ------------------------------------------------------------------------
                                                Fiscal year     Fiscal year
                                               2010 enacted   2011 requested
    ------------------------------------------------------------------------
    Sustainment (O&M & MilPers).............         8,251.0         9,042.0
    Recapitalization (O&M, Milcon, Milpers,          6,448.0         4,583.0
     RDTE)..................................
                                             -------------------------------
          TOTAL S & RM......................        14,699.0        13,625.0
    ------------------------------------------------------------------------

        Sustainment represents the Department's single most important
    investment in the overall health of its inventory of facilities.
    Sustainment includes the regularly scheduled maintenance and repair or
    replacement of facility components--the periodic but predictable
    investments that should be made throughout the service life of a
    facility to slow its deterioration and optimize the owner's investment.
    We use a Facilities Sustainment Model (FSM) based on industry
    benchmarks to estimate the annual cost of regularly scheduled
    maintenance and repair for different types of buildings. We then
    require the Military Departments and Components to fund sustainment of
    their facilities at a level equal to at least 90 percent of the FSM-
    generated estimate. Our fiscal year 2011 budget request is consistent
    with that requirement.
        The second key investment we make in the health of our facilities
    is recapitalization (restoration and modernization). Recapitalization
    serves to keep the inventory of facilities modern and relevant in an
    environment of changing missions and standards, to extend the service
    life of facilities, and to restore capability lost due to man-made or
    natural causes including inadequate sustainment. Compared with
    sustainment, recapitalization needs are much harder to forecast because
    they are often a function of change, such as a new functional standard
    for enlisted housing, the availability of new technology (e.g.,
    improved technology for heating and cooling), or even a change in the
    very mission that the facility supports. The fiscal year 2011 budget
    request ($4.6 billion) is $1.9 billion lower than the fiscal year 2010
    enacted level primarily because we are nearing the end of the BRAC 2005
    process, which drove a significant amount of recapitalization.
        In the past, the Department used a target recapitalization rate to
    establish an annual investment level for the entire building inventory.
    In recent years our goal was to recapitalize buildings every 67 years.
    However, this approach did not provide information on the condition of
    individual buildings--precisely the kind of information that one should
    use to guide decisions on specific investments.
        Since 2006, the Federal Real Property Council (FRPC) has required
    Federal agencies to rate the quality of individual facilities using a
    Facility Condition Index (FCI). This quality rating, expressed in terms
    of the relationship between what it would cost to replace a facility
    and what it would cost to repair it, allows us to identify those
    facilities in greatest need of investment. By this measure, 18 percent
    of the 539,000 facilities in the Department's inventory are in poor
    condition and another 7 percent are in failing condition.
        Using the facility condition data that DOD is already collecting,
    my staff is developing a new methodology for determining the level of
    investment needed overall and the optimal method of targeting that
    investment. We will consider factors other than just the condition of
    the building--e.g., mission priority. The result will be a capital
    investment plan to eliminate facilities that are in poor and failing
    condition.
        In addition to sustaining and recapitalizing our facilities, we are
    committed to eliminating facilities that we either no longer need or
    cannot repair economically. Demolition is an important tool in any
    recapitalization and will also play a role in our capital investment
    plans. The fiscal year 2011 budget request includes more than $200
    million for this purpose.

                            MANAGING OUR ENERGY USE

        The recently released Quadrennial Defense Review (QDR) makes clear
    that crafting a strategic approach to energy and climate change is a
    high priority for the Department. Although much of the focus has been
    on the energy we use in a combat setting (``operational energy''), the
    management of energy on our permanent installations (``facility
    energy'') is also extremely important. The Energy Conservation
    Investment Project (ECIP) is a key element of the Department's facility
    energy strategy: ECIP supports energy efficiency and renewable energy
    projects based on payback and has achieved an estimated $2.16 in
    savings for every dollar spent. The fiscal year 2011 President's budget
    requests $120 million for ECIP. This is $30 million above our fiscal
    year 2010 request but less than the fiscal year 2010 enacted amount
    ($174 million).
        To put ECIP in context, let me briefly discuss why facility energy
    management is so important and what we are doing to improve it.
        The way we manage energy at our permanent installations is
    important for two key reasons. First, facilities energy represents a
    significant cost. In 2009, DOD spent $3.8 billion to power its
    facilities--down from $3.96 billion in 2008. That represents about 28
    percent of the Department's total energy costs (that fraction is higher
    in peacetime, when we are not consuming large amounts of operational
    energy). Moreover, energy needs for fixed installations in the United
    States will likely increase over the next several years as we ``grow''
    the Army and the Marine Corps, reduce our presence in Iraq and
    Afghanistan, and continue to improve the quality of life for soldiers
    and their families--for example, by installing flat-panel TVs in
    individual rooms in a barracks that now has just one TV per common
    room.
        Facilities energy is costly in other ways as well. Although fixed
    installations and non-tactical vehicles account for less than a third
    of DOD's energy costs, they contribute nearly 40 percent of our
    greenhouse gas emissions. This reflects the fact that our installations
    rely on commercial electricity, which comes from fossil fuels--
    principally coal. Given that facilities energy as a share of total DOD
    energy will increase when we reduce our presence in Iraq and
    Afghanistan, fixed installations will likely become DOD's major source
    of greenhouse gas emissions.
        Second, installation energy management is key to mission assurance.
    According to the Defense Science Board, DOD's reliance on a fragile
    commercial grid to deliver electricity to its installations places the
    continuity of critical missions at serious and growing risk.\1\ Most
    installations lack the ability to manage their demand for and supply of
    electrical power and are thus vulnerable to intermittent and/or
    prolonged power disruption due to natural disasters, cyber attacks and
    sheer overload of the grid.
    ---------------------------------------------------------------------------
        \1\ ``More Fight-Less Fuel,'' Report of the Defense Science Board
    Task Force on DOD Energy Strategy, February 2008.
    ---------------------------------------------------------------------------
        Over the last 5 years, the Department has steadily reduced energy
    consumption per square foot at our permanent installations, largely in
    response to statutory and regulatory goals. While continuing that very
    positive trend, it is time for us to adapt our approach to installation
    energy management from one that is primarily focused on compliance to
    one that is focused on long-term cost avoidance and mission assurance.
        In the last year, the Department has made energy policy a
    significantly higher priority. First, Secretary Gates has expressed his
    strong support for the goal of reducing energy consumption, and the QDR
    reflects his desire for a more strategic approach to energy security.
    As one indication of this commitment, the Department recently announced
    that, under Executive Order 13514, it will reduce greenhouse gas
    emissions from non-combat activities--largely installations and non-
    tactical vehicles--by 34 percent by 2020. Since greenhouse gas
    pollution is due overwhelmingly to direct energy use, this aggressive
    target, along with DOD's High Priority Performance Goals, will require
    major gains in energy efficiency at our installations.
        Second, the Department is investing more to improve the energy
    profile of our fixed installations. Financing for these investments has
    come from annually appropriated funds, including military construction,
    operations and maintenance, and ECIP. We have utilized third-party
    financing through Energy Savings Performance Contracts and Utilities
    Energy Service Contracts. We are also pursuing other innovative
    financing mechanisms, such as Enhanced Use Leases and Power Purchase
    Agreements (PPAs).
        Our basic investment strategy is twofold: (1) Reduce the demand for
    traditional energy through conservation and energy efficiency; and (2)
    increase the supply of renewable and other alternative energy sources.
    Investments that curb demand are the most cost-effective way to improve
    an installation's energy profile. As Department of Energy (DOE)
    Secretary Steven Chu has observed, ``Energy efficiency is not just the
    low hanging fruit; it's the fruit lying on the ground.''
        A large percentage of our demand-side (energy efficiency)
    investments are expended on projects to retrofit existing buildings.
    The Department spends almost $10 billion a year to sustain, restore and
    modernize our facilities. About one-sixth ($1.7 billion) of this is
    spent on projects designed directly to improve energy efficiency.
    Typical projects install improved lighting, high-efficiency HVAC
    systems, double-pane windows, energy management control systems and new
    roofs. As we replace major components and subsystems in our buildings,
    the newer, more energy-efficient systems contribute to DOD's overall
    energy reduction goals.
        In addition to retrofitting existing buildings, we are taking
    advantage of new construction to incorporate more energy-efficient
    designs, material and equipment into our inventory of facilities. The
    Department spent about $25 billion on military construction in fiscal
    year 2009 and we will devote another $23 billion to construction in
    fiscal year 2010. (As discussed earlier, we are asking for $18.7
    billion for Milcon in fiscal year 2011.) New construction must meet
    Leadership in Energy and Environmental Design (LEED) Silver standards
    and/or the five principles of High Performance Sustainable Buildings,
    which includes exceeding the energy efficiency standard set by the
    American Society of Heating, Refrigerating and Air-Conditioning
    Engineers by at least 30 percent.
        On the supply side, our military installations are well situated to
    support solar, wind, geothermal and other forms of renewable energy. As
    you know, we have the second largest solar array in North America at
    Nellis Air Force Base in Nevada. Additionally, the geothermal plant at
    Naval Weapons Center at China Lake, California, is providing
    electricity to the State's electrical grid; hydrogen fuel cells provide
    back-up power for facilities at Fort Jackson, South Carolina; and the
    Marines will test a wave power program at Kaneohe Bay, Hawaii, in the
    near future.
        The Department took advantage of the $7.4 billion it received
    through the Recovery Act to invest in both energy efficiency and
    renewable energy projects. We devoted $2 billion of that amount to
    projects designed to improve existing buildings, largely through
    upgraded systems and equipment. Of that, $120 million went to ECIP.
    Another $1.6 billion of Recovery Act funds is going to construct new
    facilities, all of which will meet LEED Silver standards and/or the
    five guiding principles of High Performance Sustainable Buildings.
        Finally, our military installations can play a valuable role as a
    test bed for next generation technologies coming out of laboratories in
    industry, universities and the Department of Energy. DOD's built
    infrastructure is unique for its size and variety, which captures the
    diversity of building types and climates in the United States. For a
    wide range of energy technologies, DOD can play a crucial role by
    filling the gap (the ``valley of death'') between research and
    deployment. As both a real and a virtual test bed, our facilities can
    serve as a sophisticated first user, evaluating the technical validity,
    cost and environmental impact of advanced, pre-commercial technologies.
    For technologies that prove effective, DOD can go on to serve as an
    early customer, thereby helping create a market, as it did with
    aircraft, electronics and the Internet. This will allow the military to
    leverage both the cost savings and technology advances that private
    sector involvement will yield.
        We are pursuing the energy test bed approach on a small scale
    through the Environmental Security Technology Certification Program
    (ESTCP). Using $20 million in Recovery Act funding, ESTCP awarded
    contracts through a competitive solicitation to nine projects to
    demonstrate technologies that will provide for increased energy
    efficiency or that will generate cost effective renewable power on
    site. For example, one ESTCP project team is conducting a multi-site
    demonstration of building-integrated photovoltaic roof concepts. By
    verifying that an energy efficient roof can perform its expected
    function, DOD can increase its capacity to generate renewable energy.
    The Naval Facilities Engineering Command leads this project in
    collaboration with Lawrence Berkeley National Laboratory.
    Demonstrations are taking place at Luke Air Force Base and Marine Corps
    Air Station Yuma, both in Arizona, and Naval Air Station Patuxent River
    in Maryland.
        The test bed approach is key to meeting the Department's needs, but
    it is also an essential element of a national strategy to develop and
    deploy the next generation of energy technologies needed to support our
    built infrastructure. We hope to expand it, working closely with the
    Department of Energy and other agencies and organizations.
        The Department is pursuing several other initiatives to address
    specific challenges or impediments to improved installation energy
    management. Let me briefly describe two of them.
        First, we have begun what will likely be a major effort to address
    the risk to our installations from potential disruptions to the
    commercial electric grid. The Department is participating in
    interagency discussions on the magnitude of the threat to the grid and
    how best to mitigate it. We are also looking at how to ensure that we
    have the energy needed to maintain critical operations in the face of a
    disruption to the grid. As required by the National Defense
    Authorization Act, the Secretary of Defense this year will give
    Congress a plan for identifying and addressing areas in which
    electricity needed for carrying out critical military missions on DOD
    installations is vulnerable to disruption. The development of renewable
    and alternative energy sources on base will be one element of this
    effort, because--in combination with other investments--these energy
    sources can help installations to carry out mission-critical activities
    and support restoration of the grid in the event of disruption.
        Second, we are devoting considerable time and effort to a complex
    and growing challenge--ensuring that proposals for domestic energy
    projects, including renewable energy projects, are compatible with
    military requirements for land and airspace. As noted above, military
    installations lend themselves to renewable energy development, and a
    renewable project can benefit the host installation by providing a
    secure source of energy and reduced energy costs. In some cases,
    however, a proposed project can interfere with the military mission.
    For example, wind turbines can degrade air- and ground-based radar, and
    solar towers can cause interference by creating thermal images
    detrimental to sensitive testing of weapons systems. The current
    process for reviewing proposals and handling disputes is opaque, time
    consuming and ad hoc.
        The Department is working to balance the Nation's need for
    renewable sources of energy with military mission needs. The DOD
    ``product team'' devoted to sustaining our test and training ranges,
    which I co-chair, is working to come up with a better process for
    evaluating proposals from energy developers who want to site a
    renewable project on or near an installation. We have begun to reach
    out to potential partners, including other Federal agencies, energy
    developers, State and local governments, and environmental
    organizations. In addition to working to improve the current approval
    process, the Department is looking at the role of research and
    development. New technology can allow us to better measure the
    potential impact of a proposed project. It can also help to mitigate
    the impact. For example, recent press accounts suggest that
    developments in stealth technology as applied to turbine blades can
    reduce the harm to ground-based (but not air-based) radar.

                                   CONCLUSION

        My office, Installations and Environment, takes very seriously our
    mission to strengthen DOD's infrastructure backbone--the installations
    that serve to train, deploy and support our warfighters. Thank you for
    your strong support for the Department's installation and environment
    programs, and for its military mission more broadly. I look forward to
    working with you on the challenges and opportunities ahead.

        Senator Hutchison. Thank you. I think that we are making
    remarkable progress on BRAC, by the way, and that we are so
    close. It is very good and we fully funded. This subcommittee
    made that a priority.
        Dr. Robyn. Yes.
        Senator Hutchison. So thank you.
        Mr. Mitchell?
        Mr. Hale. Mr. Mitchell does not have a statement. He is
    just here to help us answer questions on Guam policy.
        Senator Hutchison. Okay, good.
        I am going to let my colleagues go first on the questions,
    and then I will follow up. I do not know who was here first.
        Senator Collins. Thank you. Thank you, Madam Chairwoman.
    Does that not sound good again?
        Senator Hutchison. It is very fleeting.
        Senator Collins. Let me first commend you and the
    subcommittee's chairman for working so well as a team. I could
    not help but think, as the chairman departed, that he was
    totally comfortable turning over the gavel to you. And while I
    hope that is a sign of things to come, I was impressed with how
    closely you worked together for the good of the military.

                            CLOSURE OF NAS BRUNSWICK

        Dr. Robyn, I want to direct my questions this morning to
    you. The State of Maine is coping with the imminent loss of a
    major defense installation, the Brunswick Naval Air Station in
    Cumberland County. The squadrons and most of the military
    personnel have already departed, and the base is scheduled to
    close its doors next year. The number of jobs lost is estimated
    by the Pentagon, direct and indirect jobs, to be more than
    6,500. On the list that was prepared for the Base Closure
    Commission, Maine was ranked fifth in the Nation in the number
    of jobs that would be lost as a result of the BRAC decisions.
        So this is a very difficult economic blow for the State of
    Maine, for the Brunswick region in particular. And as you can
    appreciate, the recession makes the redevelopment of this base
    even more challenging than it otherwise would be.
        To help compensate for these negative impacts, last year as
    a member of the Armed Services Committee, I worked very hard to
    include a critical provision in the defense authorization bill
    that would help to accelerate the transfer of excess military
    property at a reduced cost or even no cost when it is for
    economic development. It is my understanding that you and your
    office are now working on the regulations to implement those
    provisions.
        Could you first give us an update on the status of those
    regulations? There is concern in Maine about when they are
    going to be issued. The prime time for economic development
    activity in my State is coming up right now. So could you first
    give us an update on that?

                        ECONOMIC DEVELOPMENT CONVEYANCE

        Dr. Robyn. Sure. I took a real interest in the economic
    development conveyance mechanism. I worked in the Clinton White
    House during the BRAC rounds in the 1990s. We worked with the
    Congress then to create the EDC mechanism, and it has gone
    through various iterations.
        Prior to the action of the Congress in the last defense
    bill, the EDC mechanism had become very slow and cumbersome.
    The services were required to seek to obtain fair market value.
    The valuation process was a very cumbersome one. So Congress
    gave us clarification and some new authority that freed the
    services from having to seek to obtain fair market value. You
    also gave us additional flexibility to use some innovative
    mechanisms such as back-end participation so that if a
    development does well, the Defense Department can take much or
    most of its compensation on the back end.
        First of all, let me say that as soon as that law took
    effect, those provisions were in effect. Even before I put out
    regulations, the new law is in effect. It replaced the old law
    saying the services had to seek to obtain fair market value. So
    the law took effect immediately. I put out a memo to the
    services giving some policy direction. I am working closely
    with them to get the regs out and also too so that even before
    the regs are out, that they are adopting the new approach,
    which I think they are.
        So I think we have already seen some response. Treasure
    Island. The city and the Navy negotiated an agreement on
    Treasure Island. They had been unsuccessful in doing that over
    many years, and with the clarity that you all provided, they
    were able to reach an agreement that provided for back-end
    participation.
        I do not know enough about the details of Brunswick to know
    what sort of an EDC that will be, but I think we have changed
    course in response to the direction from Congress and I am
    watching it closely.
        Senator Collins. Thank you. I know my time is almost
    expired. So let me just say that I will ask you to work very
    closely with the local redevelopment authority in Maine. This
    is going to be a tremendous challenge, and it is going to be
    important that the Department factor in local economic
    conditions and a lot of flexibility as we have given you.
        Dr. Robyn. Yes.
        Senator Collins. And I look forward to working closely with
    you.
        Dr. Robyn. Thank you.
        Senator Collins. Thank you.
        Thank you, Madam Chairman.
        Senator Hutchison. Senator Pryor.
        Senator Pryor. Thank you, Madam Chair.

                         OFFICE OF ECONOMIC ADJUSTMENT

        Dr. Robyn, let me ask you a few questions. In the first
    question or two, I want to ask about the OEA, the Office of
    Economic Adjustment. We have the Pine Bluff arsenal in Pine
    Bluff, Arkansas, which is doing a destruction of all of its
    chemical stockpile. Later this year, they are going to lose
    about 1,100 jobs. There are 350 Government employees, about 750
    contractors.
        My question is, knowing that and knowing that is coming
    this year, what should the OEA be doing for Pine Bluff right
    now?
        Dr. Robyn. Well, I believe the OEA is working with Pine
    Bluff. My understanding is they awarded a small grant last
    month, a little over $600,000, and they waived most of the
    local match requirement. I think the OEA staff was down there
    recently. I am told that the State of Arkansas is not going to
    apply to the Department of Labor for a national emergency grant
    to provide support workforce assistance. I am not sure what the
    rationale for that is.
        But OEA is a wonderful organization. I am very proud to
    have it part of what I oversee now. OEA was created by Robert
    McNamara in the 1960s. They have done a terrific job over the
    years and can provide a lot of planning and technical
    assistance to communities like Pine Bluff that are going
    through this sort of transition.
        Senator Pryor. Do you know if the OEA is working on trying
    to get more mission there to the Pine Bluff arsenal?
        Dr. Robyn. To get other DOD activity? Not that I am aware
    of. That is typically not part of what OEA does.
        Senator Pryor. Okay. When you add it all up, there is going
    to be an economic impact of about $100 million annually to Pine
    Bluff and that area. My sense is, in talking to people in Pine
    Bluff and that area--they have kind of a regional chamber of
    commerce--is that they are not real happy with the efforts that
    OEA has made. So why do you and I not follow up at some point
    and see if we can get a little more attention down there and
    see if we can find some good things for them to do?
        Dr. Robyn. Okay.
        Senator Pryor. Another question I have for you, Dr. Robyn,
    is my understanding is that the National Guard Bureau had
    provided a list of over 100 unfunded priorities and shovel-
    ready projects that total up to about $1.2 billion total. My
    understanding is that in the stimulus money, et cetera, the
    Recovery Act, most of these requests, maybe not all, but almost
    all were ignored. Were you aware of that? And do you know the
    situation on that?
        Dr. Robyn. Are you speaking of National Guard projects
    generally?
        Senator Pryor. Yes, National Guard projects that were
    shovel-ready.
        Dr. Robyn. I do not have the figures with me. We did some
    Guard projects. I do not know the number. I will take that for
    the record.
        [The information follows:]

        The American Recovery and Reinvestment Act of 2009 (Recovery Act),
    Public Law 111-5 includes approximately $7.4 billion in Defense-related
    appropriations. Within division A of the Recovery Act, titles III and X
    provided $292 million ($266 million Army National Guard and $26 million
    Air National Guard) and $100 million ($50 million each to Army National
    Guard and Air National Guard) in specific operations and maintenance
    (O&M) and military construction (Milcon) authorization and
    appropriations to the Army and Air National Guard, respectively. To
    provide the required reports to Congress identifying the specific
    projects funded under the Recovery Act, the Department asked each
    component receiving funds to provide a list of projects within the
    amounts they received that would create and save jobs, jumpstart our
    economy, address unfunded facility requirements, build the foundation
    for long-term economic growth, improve the condition of facilities
    needed to house members returning from Iraq and Afghanistan, and
    enhance energy efficiency throughout the Department. The Army and Air
    National Guards complied with this guidance, providing 930 O&M and
    Milcon projects within the amounts they were authorized and
    appropriated.

        Senator Pryor. Yes. Just for you to think about, at the
    Senate Armed Services Committee hearing in February, just a
    month ago or less, Secretary McHugh stated: ``As to the
    distribution of Milcon, certainly if I were in a Guard or
    Reserve unit, I'd feel as though I wasn't getting what I
    needed, and we have to admit that.'' So I think that there is a
    recognition, at least in some quarters, that there are a lot of
    shovel-ready projects that need to be prioritized when it comes
    time to look at funding these type projects.
        And the third thing I had--and this may be the last because
    I am almost out of time here--is Little Rock Air Force Base is
    the Center of Excellence for the C-130 operations and basically
    every C-130 pilot almost in the world, it seems like, comes to
    Little Rock to do their training. And we have three wings
    there. One is a Guard wing and two are active duty. Anyway,
    they do great work there.
        But right now, they have 92 aircraft on the ramp. The
    fiscal year 2011 budget transferred an additional 12 C-130s to
    Little Rock, which totals 104. And my understanding is a few of
    those will be taken out because they are C-130 E models and it
    is time for them to move on. But still, they are going to end
    up with about 100 aircraft there.

                           LITTLE ROCK AIR FORCE BASE

        I remember when we were talking about BRAC a few years ago
    and also last year or the year before, we were working on a C-
    27J project. One of the things about Little Rock Air Force Base
    is it only has one runway. And I am wondering if you might be
    willing to initiate a site survey for Little Rock Air Force
    Base to look at the feasibility of doing a second runway there.
    I know they have plenty of real estate, and I have seen the
    maps before and I think they would have plenty of room to do
    it. But I was wondering if you would initiate or work with us
    to try to initiate a site survey to look into the possibility
    of a second runway there at Little Rock Air Force Base.
        Dr. Robyn. Sir, I think I am going to defer that question
    to my Air Force colleague, who will be on the panel behind me.
    It is easy for me to say yes, but I do not want to preempt my
    Air Force colleague.
        Senator Pryor. Sure.
        Secretary Hale.
        Mr. Hale. Could I just add to that? I think we would want
    to consider that and the broader issue of basing the C-27s. As
    you are well aware, we are limited to procuring the 38, and
    there are some important basing issues that still remain to be
    resolved. It probably needs to be considered in that context.
        Senator Pryor. Right, yes. And the C-27s may be a secondary
    issue at this point in how you do that. Certainly Little Rock,
    I think, makes sense, but with regard to more C-130s in the
    future maybe coming there and you have 100 on the ramp. After
    fiscal year 2011, I think it may be time to look at that. So if
    we could maybe work together on that site survey, at least for
    you all to look at it and do the analysis, I would appreciate
    it.
        Thank you, Madam Chair.
        Senator Hutchison. Senator Murkowski.

                           HOUSING AT FORT WAINWRIGHT

        Senator Murkowski. Thank you, Madam Chairman.
        Dr. Robyn, a couple relatively parochial questions here
    this morning, and then I would like to ask a question about the
    port in Guam.
        First is with regard to a partnership that the Army entered
    into with Actus Lend Lease at Fort Wainwright for privatization
    of housing. We have had some issues up north there with local
    contractors that have expressed some very serious concern that
    Actus Lend Lease was bringing in out-of-State contractors, thus
    displacing the local contractors. There were field hearings
    that were conducted by the legislature. There was a community
    advisory board that was later established. But it really was
    very contentious for a period of time, and our offices were
    very involved in trying to smooth things out.
        My question to you is--we were essentially told that the
    laws governing private housing contracts allow the Army's
    partner to contract with whomever they want.
        I guess the question that I have is whether or not you
    think that it is good policy to encourage housing privatization
    partners to use local contractors and local construction
    workers for the projects, or would it be fair to say that you
    are really indifferent on this? I cannot imagine that this is
    just an issue that is specific to Fairbanks, Alaska. Help me
    out a little bit on this.
        Dr. Robyn. Well, I have spent a lot of time telling people
    how wonderful housing privatization is. I think it is the most
    effective reform my office has taken on. I honestly have never
    come across this issue. So I cannot give you a good----
        Senator Murkowski. So you think our situation up north is
    unique?
        Dr. Robyn. I just do not know. I have been on the job 9
    months, and it may be that I just do not know about it. So I
    cannot give you a good answer. I think my Army colleague may be
    able to shed more light, but I would like to take the question
    for the record.
        Senator Murkowski. Well, I would appreciate if you would do
    it because as we look to the impact, of course, the economic
    impact that these projects bring to an area, I think it is fair
    to say that people look at them with great interest because
    they believe that not only will the military see a good benefit
    there, but the local economy will engage as well. And I think
    we have seen some real concerns where you bring the out-of-
    State guys in. They are there for the length of the project.
    They are gone and there is no real commitment to the community.
    So if you could look into that, I would appreciate it.

                UNDOCUMENTED WORKERS AT ELMENDORF AIR FORCE BASE

        The second question. This was regarding a project at
    Elmendorf Air Force Base last year, and acting on a tip from
    the iron workers unions, there were some immigration and
    customs officers that came in to interview employees of an Air
    Force construction project. This was a contract for building
    hangars. Four of 30 individuals interviewed were determined to
    be not lawfully eligible to work here in the United States. One
    was determined to have a criminal history in the State of
    California. I think we all recognize that our Air Force bases
    are supposed to be secure areas, and yet this was a pretty
    specific example of not only people who were not eligible to
    work here in the country and getting into the gate to do the
    work, but also of an employee with a criminal record.
        I have a couple questions. First, whether or not the
    contractor was disciplined for placing undocumented workers on
    an Air Force job site, and more broadly, what the
    administration is doing to ensure that these construction jobs,
    which are scarce and coveted most certainly, that are available
    on our military bases are going to people that are legally
    entitled to work here in the country.
        Dr. Robyn. Again, my Air Force colleague on the next panel
    may have more detail. I know the four were arrested through a
    joint effort by immigration and Air Force agents. They used
    counterfeit documents. I think we are using this as a learning
    experience to improve our clearance--approach to security. I do
    not know if the contractor was disciplined or not. It is hard
    to believe they were not because my understanding is this was a
    contractor from California that went up to Alaska and took
    workers with them. So it would seem like they were liable. But
    I do not know the specifics.
        Senator Murkowski. Well, if you can get more clarification
    for me on that, again I would appreciate it.
        And then the last question relates to the buildup on Guam.
    As the ranking member on the Energy Committee, one of our areas
    of jurisdiction and oversight responsibility is for the
    Government's relationship with our territories. I understand
    that the Port of Guam was recently denied a $50 million grant
    from USDOT to kick start the port's $200 million modernization
    program.

                           IMPROVEMENTS TO GUAM PORT

        Are you concerned about the status of the port's
    modernization? What steps are being taken to ensure that we are
    securing the needed funding for the port modernization effort?
        Dr. Robyn. Yes. There were $1 billion in stimulus money for
    TIGER grants allocated by the Department of Transportation, and
    they were heavily oversubscribed. There was a huge demand for
    those, and Guam did not make the cut. It was a large
    application, $50 million. The nice thing was it would have been
    matched by a $50 million loan from the U.S. Department of
    Agriculture.
        We are scrambling throughout the Federal Government, those
    of us who work on Guam, to address that issue so that we can
    try to preserve the USDA commitment to match----
        Senator Murkowski. So what do you figure the path forward
    will be?
        Dr. Robyn. Well, it is a little premature for me to say,
    but I think we recognize that the port needs to be upgraded to
    accommodate the buildup. It is a shared responsibility within
    the Federal Government. So we are looking at--the Department of
    Defense has very limited mechanisms for doing unauthorized--we
    cannot do unauthorized military construction. So we do not have
    the authority to do this even if we wanted to. We are looking
    at mechanisms, though, that would allow for a cross-Government
    acceptance of this responsibility because this is step one in
    the buildup.
        Senator Murkowski. It sounds like you are equally concerned
    and recognize the level of priority there.
        Dr. Robyn. Yes, absolutely.
        Senator Murkowski. Thank you, Madam Chair.
        Senator Hutchison. Thank you.
        Let me start on the Milcon for Europe. The $513 million in
    Germany and in Korea, the Department is looking at tour
    normalization, which means extending the average tour length
    and allowing more dependents to accompany their sponsors.

                           OVERSEAS BASING COMMISSION

        I just want to ask why is the Department undoing the
    Congress' authorization bill that included the Overseas Basing
    Commission, the previous commitments to bring home 70,000
    troops, mostly from Germany and Korea. This was a bill--
    Overseas Basing Commission was cosponsored by Senator Feinstein
    and myself when we ran this subcommittee.
        It just seems that you are changing a policy that was
    established by Congress, and I would like to know what is the
    reason for this kind of commitment and the cost of $2 billion
    to American taxpayers for this kind of building in Germany and
    Korea.
        Mr. Hale. Well, Madam Chairwoman, let me try to be helpful
    by saying, first, I do not think it is our intention to undo
    congressional guidance or not to follow it.
        We are committed to some level of overseas deployment of
    our troops, but we are looking at those specifics. The QDR, I
    think, arrived at a broad policy but did not arrive at some of
    the specifics that I know are of particular interest to you,
    especially whether or not we will bring home--or how many BCTs
    we will bring home from Europe. We decided that we needed some
    more negotiation with our allies before making that decision
    and, therefore, put it off. We expect to make a recommendation
    in the fiscal year 2012 budget as opposed to this budget.
        As far as Korea, we----
        Senator Hutchison. Excuse me. Then are you saying that the
    $513 million does not include the extension of two more BCTs?
        Mr. Hale. To my knowledge, it does not make that commitment
    because we have not made that decision.
        Actually I looked at it. Our total overseas military
    construction is down sharply between 2010 and 2011 from $3.1
    billion to $2.1 billion. But you are right. There are some
    increases in Germany, I think, associated with the Wiesbaden
    consolidation. But we have not made a decision as to whether or
    how many BCTs to bring home. Those will be, I believe, a
    commitment to reflect that decision in the fiscal year 2012
    budget.
        On Korea, we have approved the first phase of tour
    normalization, which is a fairly modest price tag, but are
    continuing to look at the second and third phases, which would
    be much more substantial in cost. I think part of the issue, as
    you raise, is that we have to assess what is our long-term
    commitment in Korea. I anticipate it will remain a commitment,
    but how large has to be a question.
        Senator Hutchison. What is your policy as comptroller on
    the contribution of host countries such as Germany and Korea?
    And what would you be asking them to contribute for these
    specific requests?
        Mr. Hale. I do not think we have a percentage policy. We
    always like contributions from our allies. I do not have for
    you the percentage contributions of the Germans in terms of the
    current overseas military construction. My sense is the Germans
    have been very helpful in paying operating costs. I am not sure
    on the military construction. I will have to supply that for
    the record.
        We would like a substantial contribution. I think that is
    inevitably negotiated on a case-by-case basis.
        Senator Hutchison. I would like, before we come forward
    with our recommended military construction appropriations
    report, to know what is the German and Korean contribution to
    the requests that are being made.
        Mr. Hale. We will supply that.
        [The information follows:]

        The Republic of Korea (ROK) is not making any contribution to
    projects included in the fiscal year 2011 Milcon request. Rather, the
    ROK contributes to U.S. construction requirements through a formal
    burden sharing agreement, where construction is one component of that
    agreement.
        In the year 2009, a 5-year burden (cost) sharing agreement was
    signed with the ROK. In force through the year 2013, the agreement is
    formally called the Special Measures Agreement (SMA). Under the 5-year
    SMA, ROK burden sharing contributions occur in three separate
    categories: labor, logistics, and construction. The ROK is providing
    790.4 billion won ($749.9 million) in burden sharing contributions
    during calendar year 2010--an increase of 30.4 billion won from the 760
    billion won provided in calendar year 2009. Within these two totals,
    315.8 billion won ($299.6 million) and 292.2 billion won ($228.9
    million) is for construction in calendar years 2010 and 2009,
    respectively. In calendar year 2011, the ROK's total burden sharing
    contribution will be 812.5 billion won ($829 million). It is expected
    that the portion of this total 2011 contribution devoted to
    construction will be around $326 million.
        In addition, the ROK funds most of the cost of relocating U.S.
    forces from Seoul under the Yongsan Relocation Plan (YRP). Further, ROK
    Funded Construction funding, provided under the Special Measures
    Agreement, is being used to the maximum extent to implement the Land
    Partnership Plan (LPP), which consolidates and relocates all other
    forces in Korea. The YRP and LPP realignment initiatives--currently
    underway--will result in better facilities and improved quality of life
    for USFK personnel, create enhanced warfighting capabilities, and
    demonstrate the commitment of the United States to an enduring military
    presence on the Korean Peninsula that will promote peace and stability
    on the peninsula and in the region.
        The Government of Germany is not making any direct contribution to
    projects included in the fiscal year 2011 Milcon request. The United
    States has no formal infrastructure-related burden sharing agreement
    with Germany. However, through their participation in NATO and the NATO
    Security Investment Program (NSIP), Germany may ultimately share a
    portion of Milcon costs for the Air Traffic Control Tower in NAS Rota
    and the Hydrant Fuel Project in RAF Mildenhall. If NATO determines
    these projects to be eligible for common funding, 17 percent of any
    NSIP recoupment the United States receives could be accurately
    characterized as a German contribution. These projects have been pre-
    financed in accordance with DOD and NATO guidance in anticipation of
    potential future recoupment. (The requested SHAPE school and NATO HQ
    projects represent the U.S. portion of those projects and there will be
    German and other national contributions.)
        While Germany makes no direct contributions to the U.S. Milcon
    program, they make significant non-financial contributions in support
    of U.S. interests. In accordance with the terms of the SOFA, the United
    States executes the majority of our Milcon in Germany through the
    German Bauamt. Because Bauamt fees are significantly lower than those
    charged by the Corps of Engineers, use of these services reduces the
    direct cost of design, procurement, and construction management
    activities by roughly 65 percent. In fiscal year 2011, this indirect
    contribution equates to approximately $30 million.
        In addition, Germany bears approximately 25 percent of the direct
    costs for items such as rents on privately owned land, facilities,
    labor, utilities, and vicinity improvements in support of Germany-based
    United States forces. Further, Germany has assisted United States force
    presence in the facilities area through host nation funding of nearly
    $1 billion to date in facilities constructed as Payment in Kind
    compensation for U.S.-funded improvements at facilities returned to the
    host nation. Other indirect contributions include loan guarantees to
    public private venture housing, non-imposition of certain taxes/fees,
    and rent free use of land for basing and training.

        Senator Hutchison. Was there a business case analysis
    prepared that justified retaining four BCTs in Europe?
        Mr. Hale. I am not aware of a business case. I am aware of
    considering that in light of our overall desire for overseas
    deployment, some of which aid our ability, for example, to
    fight in Iraq and Afghanistan. We are drawing heavily on those
    troops. Especially in the beginning, we drew heavily on troops
    deployed in Germany. So I think it is a foreign policy
    decision, and one that is taken in the context of the QDR. But
    as I said, we decided not to make the specific decision this
    year. We wanted further negotiations with our allies.
        Senator Hutchison. Well, I would like to ask you also to
    submit for the record whether it is, in fact, more efficient to
    deploy from Germany into Iraq and Afghanistan as opposed to
    from the United States because there were severe restrictions
    placed on transferring troops into Iraq in the early stages of
    that buildup. And it caused delays and it even caused having to
    use, in some cases, paratroopers as opposed to trains and even
    air flights. So I think that has to be considered, and I want a
    report on that because I think it is a factor.
        [The information follows:]

        There is no single answer to whether it is more efficient to deploy
    from CONUS or Europe. There are many ways to define deployment
    efficiency including time, fuel usage, manpower, transport demand, and
    diplomatic challenges. For instance, Germany may be more efficient for
    airlift but may not be for sealift.
        To be clear, Germany placed no practical impediments or hindrances
    on United States deployment to Iraq and Afghanistan. In fact, Germany
    provided guards for United States bases to free up personnel for
    deployment.

                                      GUAM

        Senator Hutchison. Okay, let us talk about Guam. I
    appreciate your statements, Dr. Robyn, but I think there are
    significant questions and certainly significant cost increases
    on the horizon for this move on Guam. The report in the news is
    that the Governor of Guam has said he needs $3 billion in
    assistance before we spend $13 billion on military
    construction.
        I would just ask the question because this is going to
    significantly increase the cost to American taxpayers. Japan
    has agreed to fund a significant portion of this move, I think
    around $7 billion, which I think is very helpful. But the rest
    would then, of course, fall on the American taxpayer.
        Are you looking at alternatives at all that would be more
    efficient than this entire move to Guam? Is there any
    alternative even being considered. With the size of the island
    and the infrastructure not being adequate, are there other
    alternatives that we ought to be looking at?
        Dr. Robyn. I am going to defer to my colleague, Derek
    Mitchell, on this one.
        Mr. Mitchell. Okay. Thank you, Senator.
        In fact, this process has been going on for about 15 years
    since the mid-1990s looking at alternatives for moving the
    Marine base in Okinawa to another location. So basically a host
    of alternatives have been looked at by the U.S. Government in
    cooperation with the Government of Japan for that period.
        Right now, the Government of Japan, the new Government of
    Japan, is looking at this very question of are there viable
    alternatives from their perspective. That review is ongoing. We
    respect that review in the U.S. Government, and we are waiting
    for them to come up with their version and their view.
        We believe the current is the best. We really have looked
    at a number of different options.
        Senator Hutchison. ``Current'' meaning the move to Guam or
    staying in Okinawa?
        Mr. Mitchell. Well, moving the Marine base, the Futenma
    base, up to the north of Okinawa and then some of the marines
    back to Guam. That really is the best.
        Senator Hutchison. A fewer number than the 8,000?
        Mr. Mitchell. No the current plan, 8,000 to Guam and 10,000
    up to the north of Okinawa. We looked at a number of different
    permutations and options over truly 10-15 years and continue to
    respect the process that the Government of Japan is undergoing
    right now. So yes, the answer to your question is we have
    looked at alternatives, but we still believe this is the best.
        Dr. Robyn. Can I just say that, of course, we are not going
    to move any marines from Futenma until we have an agreement--or
    until there is clarity on where they are going. But having said
    that, Guam is--there has never been an issue that Guam is of
    vital, strategic importance and a good place to expand our
    military presence. It is U.S. territory. It is one of a number
    of islands. It provides real strategic benefits.
        Senator Hutchison. Well, I would just submit that in the
    time that you say we have been looking at this, certainly the
    infrastructure is worse than we had predicted and costs have
    certainly gone up. So I just think it is worth another look at
    whether this island can accommodate this kind of influx and if
    it is the very best move that we could make. But I realize that
    options are probably few in this part of the world.
        I mean, Korea would be--the move south in Korea I know is
    certainly part of our overall strategy, which is correct,
    because it will provide forward basing opportunities. I mean,
    speaking of Korea, I still question how many troops and now
    even an added element in Korea of longer tours and more
    families, which increase costs. I am going to probably want to
    look at that more carefully as well, just how much more we are
    going to do in Korea. We do need to get out of the base in
    Seoul and move south, and that is in our interest as well as
    Korea's. But we have certainly kept a presence there for longer
    than was necessary by far.
        And I just think we have got to start looking at the money
    that we are spending overseas and is it better to have
    permanent bases in America where you do not have training
    constraints and you do not have urban buildup and it is a more
    stable environment for our families. So I would like to pursue
    that with anyone who is willing to answer, or do I need to go
    to other policymakers for those thoughts?
        Mr. Mitchell. I appreciate those sentiments, Senator. Let
    me just say from the strategic standpoint--I am in the policy
    division of the Pentagon. And there really is a strategic
    value, as you suggest, on the forward deployment of U.S.
    forces. It has a tremendous impact on the commitments that we
    continue to have to our allies, to our strategic position in
    Asia. It gives us an advantage as well. So I understand the
    costs and the difficulties of working with foreign local
    communities, et cetera. There are challenges. There are
    complications involved. But the strategic advantage in our
    relationships and preferred diplomatic engagement that we get
    from the deployment, our ability to engage other forces, to
    interact with them, to mix with them, to train does have a
    great strategic impact for the United States overall even if
    there may be some constraints placed on them.

                             MOVING MARINES TO GUAM

        Senator Hutchison. Have you looked at whether it would be
    more efficient to move some of the Guam marine base personnel
    to Korea and consolidate there rather than the added
    infrastructure and the coral reef issue at the port? There are
    so many issues that are coming up now that had not been there
    before. Are you looking at whether perhaps that Marine base or
    part of it would be more efficiently put as a forward
    deployment opportunity in Guam?
        Mr. Mitchell. Well, we have looked at----
        Senator Hutchison. I mean in--I am sorry--Korea.
        Mr. Mitchell. In Korea. As I say, over a long period of
    time, we looked at various options, and this is, as you say, a
    very complicated, complex issue and there will be challenges to
    put forces in Korea as there would be other places. You know,
    this is a fluid situation. I mean, the American presence in
    Asia has been--well, we have been there since World War II and
    we have been quite flexible in how we postured ourselves. We
    continue to review our posture in Asia and East Asia. We think
    Guam, though, is quite a strategic location. It is, as you
    suggest, a U.S. territory. There are challenges on the ground
    in Guam, but they would be putting some funding into U.S.
    citizens to building up U.S. infrastructure in that regard. We
    have a great deal of flexibility operating from there as well.
        So there are benefits being completely into the Asian
    continent, as we are in Korea and just offshore in Japan, as
    well as being back in Guam. And it gives us a kind of flexible,
    modern and, I think, strengthened posture in Asia that we need
    to maintain our strategic position in the region.
        Senator Hutchison. Well, I would like to hear that you are
    looking at whether 8,000 troops is the right footprint in Guam,
    given the very recent questions that are being raised by the
    EPA. Maybe there needs to be a congressional requirement that
    you look at this, and I am going to think about that. And if
    you would like to give me further information so that there is
    not a directive, but maybe there should be a directive that we
    look at whether 8,000 is the right number in Guam or maybe a
    smaller footprint that would have less cost and opportunity to
    do more consolidation somewhere else, maybe Korea. I realize
    the Japanese Government has been cooperative and helpful in the
    Japanese footprint, but I just think the concerns being raised
    by the EPA are significant, and then the Governor of Guam
    asking for $3 billion. I think their interest in this is
    getting questioned by their own population. So I would like to
    hear more from you on this.

                                      GUAM

        Dr. Robyn. Senator Hutchison, could I just make one
    comment? In thinking about their infrastructure, it is useful
    to think about it in two pieces. One, Guam is a U.S. territory.
    Its infrastructure needs to be in compliance with EPA
    regulations, which it is not in major ways right now. That is a
    problem whether or not we go there. The U.S. taxpayers,
    including the people of Guam, are going to have to share that
    burden regardless. I think the question has to do with the
    additional expansion to the infrastructure that the military
    buildup would require. But under any circumstances, Guam's
    infrastructure needs to be brought into compliance with U.S.
    regulation.
        Senator Hutchison. Well, I would like to know what percent
    of $3 billion is in infrastructure that would be required
    versus the additional imprint that the marine base would put on
    Guam.
        Let me just move to the Guantanamo Bay. Secretary Hale, why
    was the full restoration of the prison in Illinois not all put
    into the military construction budget?
        Mr. Hale. Madam Chairwoman, we understand we need to work
    with the Congress to figure out a way ahead on this issue, and
    we wanted to preserve budgetary options. So what you see is a
    transfer fund in the fiscal year 2011 OCO budget for $350
    million for all aspects of detainee operations. It could be
    used for military construction to open the Thompson site. It
    could be used to close Guantanamo, or it could be used for
    operations at either site. For example, if we end up staying at
    Guantanamo, it will be only used for operations there. Since we
    did not know for sure what the final decision would be, we felt
    a transfer fund provided us the necessary flexibility.

                      MOVING PRISONERS FROM GUANTANAMO BAY

        Senator Hutchison. Well, I think there have been
    significant questions raised about the movement of prisoners
    out of Guantanamo Bay. We have made significant infrastructure
    improvements at Guantanamo Bay. We have kept the prisoners in a
    secure place, not a threat to anyone in the United States. And
    talking about $350 million to renovate this prison, you are
    going to deploy 1,000 military personnel there to guard them,
    all of which are already accommodated at Guantanamo Bay, I just
    think in an economic situation with the debt that this country
    is incurring, it is something that should certainly be
    reconsidered by this administration and I would hope that the
    administration would. I mean, they are reconsidering the
    decision to try these detainees in New York City. Thank
    goodness. And I think that we should also reconsider the
    transfer of all the prisoners into the United States from
    Guantanamo Bay, but I realize that is above your pay grade.
        Mr. Hale. I think that is right.
        But we do want the budgetary flexibility, and let me urge
    caution in one sense. If we stay at Guantanamo--the President
    has said he wants to close Guantanamo, and I certainly support
    that decision. But if we end up staying there, we will need a
    substantial part of that fund to operate Guantanamo. So we need
    to be careful to preserve our ability if the decision is made
    to remain at Guantanamo.
        Senator Hutchison. I agree, but we are not going to have a
    lot of building requirements there. We have done that. We have
    made that investment. I think that we need to be looking at
    efficient use of taxpayer dollars as well as security.

                         ADDITIONAL COMMITTEE QUESTIONS

        Thank you. I do appreciate the panel. I know I have had
    tough questions, and I look forward to hearing more about some
    of these issues and particularly the overseas military
    construction. And I think we really need to have a lot more
    policy discussion on this issue before we move forward. Thank
    you very much.
        Mr. Hale. Thank you.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                   Questions Submitted to Hon. Robert F. Hale
              Questions Submitted by Senator Kay Bailey Hutchison

        Question. The Department of Defense seems to be undoing the intent
    of the Overseas Basing Commission and the intent of Congress by the
    recent QDR recommendations to retain two Brigade Combat Teams in
    Europe, to significantly increase Milcon funding for Germany and to
    change the tour length policy in Korea to increase the United States
    personnel presence on the peninsula.
        What is the reasoning behind each of these decisions?
        Answer. Significant changes in the geo-strategic environment over
    the last 5 years, such as NATO's central role in Afghanistan and
    tensions on NATO's periphery, and the growth and transformation of the
    U.S. Army's force structure warranted the QDR's re-evaluation of the
    Department's 2004 Integrated Global Posture and Basing Study decisions
    to return two Heavy Brigades from Europe and merge Army V Corps HQ with
    U.S. Army Europe.
        The Department of Defense (DOD) deferred the decision to return two
    Brigade Combat Teams from Europe after carefully considering the issue
    from numerous perspectives: strategic, operational, force management,
    quality of like, stress on the force, institutional, environmental, and
    financial. DOD's analysis concluded that any decision on the two Heavy
    Brigades or Army V Corps HQ would need to be made in a cooperative
    manner with NATO Allies and consistent with the revised NATO Strategic
    Concept. This approach explicitly took into account the conclusions of
    the congressionally mandated Overseas Basing Commission, which
    considered the retention of the BCTs in Europe ``a cost effective risk
    mitigation force.'' \1\
    ---------------------------------------------------------------------------
        \1\ Commission on Review of the Overseas Military Facility
    Structure of the United States, May 9, 2005, pg. F12.
    ---------------------------------------------------------------------------
        The decision on the tour length policy in Korea is consistent with
    the Department's 2004 basing study. The change in tour length policy in
    Korea does not affect the United States force posture and the number of
    United States personnel assigned to Korea. Rather, the change in tour
    length policy increases unit capabilities, demonstrates the long-term
    commitment of the United States to the Alliance and to the defense of
    Korea, helps enable force availability for potential deployment to
    other regions, decreases unit training costs, and reduces stress on
    service-members, bringing tour length policies in line with similar
    theaters such as Japan and Germany.
        Question. Was there a fiscal business case evaluation of the
    decision to retain two BCT's in Europe? If no, why not and if yes, will
    you share it with this subcommittee?
        Answer. The Department of Defense (DOD) decided to defer the
    decision to return two Brigade Combat Teams from Europe after carefully
    considering the issue from numerous perspectives: strategic,
    operational, force management, institutional, environmental, and
    financial. The financial aspects considered the costs of remaining in
    Europe, the costs of relocating to the United States, and the costs of
    rotating units to Europe to fulfill the operational requirements they
    currently meet. DOD's analysis concluded that there was no overwhelming
    fiscal case supporting either retaining the two Heavy Brigades in
    Europe or returning them to the United States. Rather, the analysis
    showed that strategic considerations, such as contribution to regional
    security, deterrence, and reassurance to allies are vital, particularly
    in the short-term. DOD will continue to work towards a final decision
    on this issue, in concert with our NATO Allies and consistent with the
    upcoming revised NATO Strategic Concept.
        Question. I am concerned about the amount of construction funds
    requested by the Department for projects overseas, particularly Germany
    and Korea.
        What is the amount of the fiscal contributions by the governments
    of Germany and Korea for military construction for the last 3 years?
        Answer. Under a Special Measures Agreement (SMA), the Republic of
    Korea (ROK) contributes burden sharing support to United States Forces
    Korea (USFK) in the following categories:
      --Labor Cost Sharing--cash provided to pay the salaries and benefits
            of Korean National employees working for USFK.
      --ROK Funded Construction--cash and in-kind transfers used for USFK's
            military construction and military construction-like
            requirements.
      --Logistics Cost Sharing--in-kind provision of logistics equipment,
            supplies, and services to USFK.
        Through the SMA, the ROK provided USFK with burden sharing
    contributions that totaled $741.5 billion won ($672 million) in
    calendar year 2008, $760 billion won ($595.5 million) in calendar year
    2009, and $790.4 billion won ($663.3 million) in calendar year 2010.
    Within these totals, the amount dedicated for construction in these 3
    years is $264.2 billion won ($239.4 million) in calendar year 2008,
    $292.2 billion won ($228.9 million) in calendar year 2009, and $315.8
    billion won ($299.6 million) in calendar year 2010.
        While the Department does not have a formal burden sharing
    agreement with the Federal Republic of Germany, one of the ways they
    assist United States force presence is through the provision of
    facilities using host nation funding as Payment in Kind compensation
    for the U.S.-funded improvements on facilities returned to them. From
    2008 to the present, the German government will have contributed
    approximately $33.5 million in Payment in Kind through construction of
    the following three projects:
      --Wiesbaden Army Air Field: Infrastructure/Site Improvements, $23.0
            million;
      --Urlas Training Center, Ansbach: Infrastructure/Site Improvements,
            $4.0 million; and
      --Urlas Training Center, Ansbach: Access Control Point, $6.50 million
            (Approved but not yet started).
        Question. I am concerned about the ability of our troops to
    adequately train in and deploy from European locations versus locations
    in the United States.
        Answer. We have proven our mission readiness and training capacity
    during multiple brigade rotations over the past 7 years from numerous
    locations throughout Germany to include Grafenwoehr, Baumholder,
    Ansbuach and Schweinfurt to name just a few. The brigade at Baumholder
    and the brigade being consolidated at Grafenwoehr both have immediate
    access to two of the largest and best training areas in Europe. These
    two locations offer training, deployment and quality of life
    capabilities comparable to facilities anywhere in the United States.
    Grafenwoehr has firing ranges immediately available for the use of live
    fire, urban training, simulation, unexploded ordnance, IED detection
    lanes and more. Soldiers in Europe have the added benefit of continuous
    opportunities to train with soldiers from allied and partner nations.
    These opportunities have proven invaluable in building coalition
    partnerships with both NATO and non-NATO countries, and enhancing unit
    interoperability which remains critical in the field. Training and
    exercising in Europe also offers unique professional development for
    our future leaders. This same multi-national experience in coalition
    operations is unavailable to units based in the United States who may
    be called upon to deploy, or U.S.-based units who are scheduled to
    deploy conducting periodic rotations at forward locations.
        Deployment capability from European locations varies from
    installation to installation, but in general, it is comparable to
    deployment from U.S. locations. Rail lines and seaports in both United
    States and Europe can generally handle deployments well, but as they
    are commercially owned, the U.S. Army does not generally fund any
    improvements to commercially owned transportation nodes and links.
    Similar to U.S. installations, the European theater has deployment
    infrastructure to enhance deployment outload capability. Just as
    deployment from any U.S. installation, there can be minor gaps in
    various deployment infrastructure at European installations that affect
    the ability to meet deployment timelines. In general, these gaps are
    minor depending on the installation in question.
        Question. Please provide an analysis of the training and deployment
    capabilities from locations in Germany versus major installations in
    the United States.
        Answer. U.S. forces have, for years, received the highest caliber
    training at forward located training sites in EUCOM. These facilities
    have prepared numerous units for the rigors of combat in Iraq and
    Afghanistan, and carry with them the added benefit of direct on-the-
    ground training and interaction with Allied/partner nations under
    controlled conditions, when clear lessons can be conveyed and genuine
    learning assimilated. These geographical benefits pay important
    dividends building partner capacity and developing coalition
    warfighting interoperability, essential to success in the contemporary
    international security arena.
        U.S. Army Europe (USAREUR) has adequate training facilities to meet
    home station and pre-deployment training requirements. USAREUR units
    have successfully deployed in support of Operation Iraq Freedom and
    Operation Enduring Freedom over the past 8 years and relied on
    USAREUR's training infrastructure to prepare. Grafenwoehr Training Area
    (GTA) is USAREUR's primary live fire range complex and provides state-
    of-the-art ranges capable of accommodating live fire training from
    small arms through battalion live fire exercises. GTA has approximately
    57,000 acres of ranges and training areas which are capable of
    supporting the doctrinal training requirements for Mechanized Infantry,
    Armor, Stryker, Artillery, Aviation (rotary and fixed wing), and Light/
    Airborne Infantry units.
        In addition to the GTA, USAREUR also has the Joint Multinational
    Readiness Center (JMRC). JMRC is the Europe based Combat Training
    Center (CTC) with a world-wide exportable training capability. JMRC
    trains leaders, staffs, units up to Brigade Combat Teams (+), and
    multinational partners to dominate in the conduct of Full Spectrum
    Operations (FSO). A typical JMRC year can support eight possible
    rotation windows, all of which can be used to train for operations in
    Iraq and Afghanistan. In comparison the U.S.-based National Training
    Center and Joint Readiness Training Center supports 10 possible
    rotations per year.
        USAREUR has range infrastructure comparable to most United States
    installations that support a similar amount of units. Fort Carson,
    Colorado, provides a fair comparison i.e. 4 Heavy Brigade Combat Teams
    (BCTs) and has approximately 45 live fire ranges to support live fire
    training requirements. USAREUR's current force (2 Heavy BCTs, 1 Stryker
    BCT, and 1 Airborne BCT) has 44 ranges to support its live fire
    training requirements. Units deploying from both locations are able to
    successfully conduct home station as well as pre-deployment training.
        Regarding United States deployment capabilities from Germany, the
    most expeditious route for deployment of EUCOM heavy forces remains the
    use of the rail and seaport infrastructure in Western Europe through
    seaports such as Rotterdam, Netherlands, Bremerhaven, Germany, and
    Antwerp, Belgium. Currently, we flow our Germany-based heavy brigade
    via ports on the North Sea. U.S. Transportation Command's and U.S.
    Central Command's joint planning factors estimate a 23- to 32-day
    transit timeline from Northern Europe to Southwest Asia's Ash Shuayba
    port in Kuwait. When USAEUR deployed the 1st Infantry Division from
    European ports to Southwest Asia, the transit time was only 18 days.
    Alternatively, U.S.-based heavy brigades take up to 43 days to flow
    from the West Coast of the United States to this same port. Obviously,
    European infrastructure also allows us to deploy rapidly within our own
    theater. Our routes utilize Western Europe's mature and robust rail and
    seaport infrastructure, and are facilitated by well established,
    dependable host nation support. In the event of major combat operations
    requiring multiple U.S. divisions, U.S. ports and rail lines could
    quickly become overwhelmed. Deploying from Europe saves valuable time.
    It is quite possible that four EUCOM Brigade Combat Teams (BCT) could
    be loaded on ships and underway from Europe while their U.S. BCT
    counterparts are still awaiting their turn to load on railheads at U.S.
    installations.
                                     ______

                  Question Submitted by Senator Susan Collins

        Question. Every year, I join the other members of the Maine and New
    Hampshire delegations to attempt to address these funding shortfalls.
    For example, in fiscal year 2009, we were successful in securing $20
    million to provide a state-of-the-art facility to enhance the
    productivity and efficiency of submarine depot availabilities. Since
    1971, all but four of the military construction projects at Portsmouth
    Naval Shipyard have been congressional priorities and not included in
    the Administration's budget requests. To their credit, the workforce
    continues to safely deliver boats to the Navy on time and on budget.
        Why is it that my colleagues and I need to fight every year to make
    capital improvements to Portsmouth, a shipyard that former BRAC
    commission chairman, Anthony Principi, referred to as the Nation's
    preeminent shipyard?
        Answer. Last year, the Navy completed a comprehensive condition
    assessment of Naval shipyard buildings to analyze restoration
    requirements. A configuration analysis was also recently completed for
    modernization requirements.
        The Department is currently in the process of developing the future
    investment plans to ensure we can continue to effectively invest in our
    public shipyards to meet future mission requirements given the
    constrained fiscal environment.
        Portsmouth Naval Shipyard's capital improvement requirements are
    included in this analysis. Milcon and Special Projects address facility
    deficiencies in the shipyard long-range infrastructure modernization
    plan. These projects are assessed against all other Navy mission
    critical requirements and prioritized for funding within our limited
    fiscal controls.
        We are investing $23.8 million in fiscal year 2010 and $17.0
    million in fiscal year 2011 for O&M Special Projects in our continuing
    effort to sustain and improve Portsmouth infrastructure. We appreciate
    the continued support from Congress to provide capital improvements at
    Portsmouth Naval Shipyard. The Navy's shipyards are fully mission
    capable and will continue to meet both current and future planned ship
    maintenance workload.
                                     ______

                    Questions Submitted to Dr. Dorothy Robyn
                 Questions Submitted by Senator Mitch McConnell

        Question. Ireland Army Community Hospital at Fort Knox is one of
    the oldest hospitals in the Army. With the new Brigade Combat Team
    stationed at the post, I am concerned over the state of the current
    hospital and its ability to meet the increased demands placed upon it.
    What is the status of the Army's decision on whether and when to build
    a replacement?
        Answer. The Department is currently in the process of developing
    the fiscal year 2012 Future Year Defense Plan of medical military
    construction projects. The Office of the Assistant Secretary of Defense
    for Health Affairs is working to ensure that the requirements for
    Ireland Army Community Hospital at Fort Knox, Kentucky, are properly
    considered as it develops future priorities for the medical military
    construction program.
        Question. With the recent addition of the Brigade Combat Team at
    Fort Knox, what is the Army doing to ensure that the installation is
    capable of deploying the unit with dispatch?
        Answer. Fort Knox is currently designated as a power support
    platform (PSP) with the mission of strategically deploying individuals
    and units from all services to include Department of Defense civilian
    employees and reserve components. Even with the addition of an Infantry
    Brigade Combat Team, Fort Knox has sufficient capacity to support all
    deploying units.
        The Army is working two key initiatives at Fort Knox to improve
    capabilities for deploying units. The first includes Army Forces
    Command (FORSCOM), providing additional resources (staff and funding)
    to support timely movement/deployment operations. Additionally, the
    Army has programmed military construction projects at Fort Knox to
    improve services, infrastructure and deployment readiness as part of
    the Army Power Projection Upgrade Program (AP3).
        Question. In light of heavy deployments, I am concerned that many
    installations, including Fort Campbell, are still housing soldiers in
    Korean War-era barracks. What is the Department of Defense doing to
    ensure housing is brought up to date to help increase morale for our
    already overly taxed troops?
        Answer. At Fort Campbell, the Army has a construction plan to
    eliminate the need for permanent party Soldiers to occupy Korean War-
    era barracks at the installation by the end of fiscal year 2013.
        In 2008, the Army completed the permanent party Barracks Upgrade
    Program (BUP) using Army Sustainment, Restoration, & Modernization
    (SRM) funding. BUP eliminated many inadequate barracks through
    modernization of existing facilities, where feasible.
        Additionally, the permanent party Barracks Modernization Program
    (BMP) will eliminate the Army's barracks shortfall and renovate
    inadequate barracks where modernization with SRM funding is not
    feasible. The Army plans to complete the BMP by the end of fiscal year
    2013.
        The Army is continuously reviewing its capital investment strategy
    to validate its plans for the replacement and sustainment of barracks,
    which constitute a major feature in the Army Campaign Plan. These plans
    address all barracks built before 1980.
        Question. Why is the Blue Grass Army Depot chemical weapons
    stockpile in central Kentucky not being monitored around the clock?
        Answer. The Blue Grass Chemical Activity (BGCA), subordinate to the
    U.S. Army Chemical Materials Agency, is in charge of the safe storage
    of the chemical weapons at Blue Grass Army Depot. The stockpile is
    stored in earth covered steel reinforced concrete bunkers. The bunkers
    are in a secured area with intrusion detection along with armed guards
    on roving patrols providing surveillance 24 hours a day.
        The BGCA relies on multiple safeguards to monitor the chemical
    munitions stockpile to ensure public and workforce safety. These
    safeguards include monitoring in accordance with our approved Kentucky
    Department of Environmental Protection permit along with visual
    inspections and application of munitions lot leaker data from both BGCA
    and other chemical agent storage sites. This combination of safeguards
    along with an active Chemical Stockpile Emergency Response Program have
    been in place at BGCA and all Army chemical stockpile storage sites for
    decades, and history has proven their effectiveness at protecting the
    workforce and the public.
        Question. It is my understanding that Fort Campbell does not have a
    liaison to help our veterans' transition from the DOD healthcare system
    to the VA healthcare system like many military bases do, including Fort
    Knox. Is this true? If so, when can Fort Campbell expect to have a
    liaison fill this important role?
        Answer. The VA Liaison position in question is actually a
    Department of Veterans Affairs position. Through informal coordination
    with the VA, DOD has learned that this vacant position has been under
    recruitment and a selection has been made. The VA is working all the
    issues of bringing the selected person on board.
        Question. Where does the Department rank energy security among its
    energy policy priorities and why?
        Answer. The Quadrennial Defense Review defined ``energy security''
    as ``having assured access to reliable supplies of energy and the
    ability to protect and deliver sufficient energy to meet operational
    needs.'' As such, the Department views energy security as the capstone
    of its energy policy, rather than as one of a list of competing
    priorities.
                                     ______

                     Questions Submitted to Derek Mitchell
              Questions Submitted by Senator Kay Bailey Hutchison

        Question. During the hearing we discussed the many problems
    associated with the relocation of the U.S. Marines to Guam.
        Were the infrastructure shortcomings on Guam evaluated before the
    decision was made to relocate there?
        Answer. The Department understood the infrastructure limitations on
    Guam would represent a potential constraint of the realignment-related
    construction and on the long-term sustainability of the relocating
    Marine forces. The limitations were identified in the 2006 Realignment
    Roadmap agreement with the Government of Japan. That plan specifically
    notes that the military build-up on Guam will require improvements in
    the civil infrastructure of the island. The roadmap agreement states
    that identifying the specific upgrades or facility improvements
    required will be part of Joint Guam Military Master Plan.
        Question. Were any alternatives to Guam formally evaluated? If no,
    why not? If yes, what were they and why were they eliminated from
    consideration?
        Answer. As part of the process leading up to the Realignment
    Roadmap agreement in 2006, the Department conducted a thorough analysis
    of the full range of U.S. force realignment alternatives in the Asia-
    Pacific region. In the end, the decision to move the Okinawa-based
    marines to Guam was made based on operational and political critical
    and our overall strategic requirements. The Guam relocation is part of
    a larger force restructuring plan under the Defense Policy Review
    initiative (DPRI) process. The full realignment package allows us to
    reposition more than 8,000 marines from Japan to Guam and return nearly
    70 percent of the land south of Kadena Air Base, benefiting the people
    of Okinawa, addressing noise, safety and environmental concerns, and
    creating a much more sustainable presence for U.S. forces on Okinawa--
    all without adversely impacting the Alliance's operation needs and
    capabilities. As a U.S. territory strategically located in the Western
    pacific, forward deployment to Guam enables us to meet our treaty and
    alliance requirements with Japan, allows for a rapid response to
    potential contingencies, and grants our forces the freedom of action
    they need to fulfill our commitment to peace and stability in the Asia-
    Pacific region.
                             Department of the Navy

    STATEMENT OF ROGER M. NATSUHARA, ACTING ASSISTANT
                SECRETARY OF THE NAVY (INSTALLATIONS AND
                ENVIRONMENT)
    ACCOMPANIED BY:
            MAJOR GENERAL EUGENE G. PAYNE, JR., ASSISTANT DEPUTY COMMANDANT
                (INSTALLATIONS AND LOGISTICS)
            REAR ADMIRAL CHRISTOPHER J. MOSSEY, DIRECTOR OF SHORE READINESS

        Senator Hutchison. And now we have our second panel: Mr.
    Roger Natsuhara, the Acting Assistant Secretary of the Navy;
    Major General Eugene Payne, the Assistant Deputy Commandant for
    Installations and Logistics; Rear Admiral Christopher Mossey,
    the Director of Shore Readiness.
        I will start with you. Mr. Natsuhara, let us start with
    your opening statement.

                    SUMMARY STATEMENT OF ROGER M. NATSUHARA

        Mr. Natsuhara. Thank you, ma'am. Ranking Member Hutchison,
    it is a privilege to come before you today to discuss the
    Department of the Navy's investments in its shore
    infrastructure. I am joined this morning by Major General
    Payne, the Marine Corps Assistant Deputy Commandant for
    Installations and Logistics, and Rear Admiral Mossey, Director
    of the Navy Shore Readiness Division.

                                 INSTALLATIONS

        The Department's fiscal year 2011 budget request includes a
    $14.9 billion investment in our installations. The military
    construction request of $3.9 billion remains at an historical
    high.
        Our program continues the effort to ensure facilities are
    in place to support the Marine Corps end strength of 202,100
    active duty personnel. We are investing over $700 million in
    funding for the construction of unaccompanied housing to
    support single sailors and marines. These funds support
    requirements associated with the Marine Corps' Grow the Force
    initiative and the Chief of Naval Operation's commitment to
    achieve Homeport Ashore by 2016.

                                      GUAM

        The Milcon request also provides further investments to
    relocate marines from Okinawa to Guam. The projects funded by
    this level of investment provide enduring infrastructure
    necessary to enable the construction program for fiscal year
    2012 and beyond. The Government of Japan in its fiscal year
    2010 budget has requested a comparable amount of $498 million,
    and we expect to receive their contribution in June.
        Regarding the EIS for the Guam relocation, as it is
    designed to do, the National Environmental Policy Act process
    and associated studies are helping us identify and address
    environmental issues and constraints and develop effective
    mitigation strategies. To that end, we are currently analyzing
    all public comments, including those received from other
    resource agencies, in developing strategies for addressing
    concerns raised in the final EIS. We are committed to
    developing effective and appropriate mitigation.

                                 FAMILY HOUSING

        The family housing request provides for the
    recapitalization of overseas housing, as well as additional
    privatization, to address the Marine Corps Grow the Force
    initiative.

                          BASE REALIGNMENT AND CLOSURE

        Regarding prior BRAC, we do not foresee much potential for
    large revenue from land sales. Thus, we again seek appropriate
    funds in fiscal year 2011 in the amount of $162 million. The
    BRAC 2005 budget request of $342 million supports outfitting,
    realignment, and closure functions as the necessary
    construction project for funding in prior years. We are on
    track for full compliance with statutory requirements by the
    September 15, 2011 deadline.

                                     ENERGY

        Finally, the Department is investing an additional $174
    million to support Secretary Mabus' aggressive energy goals to
    increase energy security, reduce dependency on fossil fuels,
    and promote good stewardship of the environment.

                               PREPARED STATEMENT

        In closing, your support of the Department's fiscal year
    2011 budget request will ensure the Department is able to build
    and maintain facilities that enable our Navy and Marine Corps
    to meet the diverse challenges of tomorrow. Thank you for the
    opportunity to testify before you today. I look forward to
    answering any questions you may have.
        Senator Hutchison. Thank you.
        [The statement follows:]

       Prepared Statement of Roger M. Natsuhara; Major General Eugene G.
                 Payne; and Rear Admiral Christopher J. Mossey

        Chairman Johnson, Senator Hutchison, and members of the
    subcommittee, I am pleased to appear before you today to provide an
    overview of the Department of Navy's investment in its shore
    infrastructure.

                      THE NAVY'S INVESTMENT IN FACILITIES

        Our Nation's Navy-Marine Corps team operates globally, having the
    ability to project power, effect deterrence, and provide humanitarian
    aid whenever and wherever needed to protect the interests of the United
    States. Our shore infrastructure provides the backbone of support for
    our maritime forces, enabling their forward presence. The Department's
    fiscal year 2011 budget request includes a $14.9 billion investment in
    our installations, an increase of over $450 million from last year.

        Our fiscal year 2011 request for Base Operating Support is $6.9
    billion (which includes nearly $450 million for environmental
    programs), 6.7 percent greater than last year's request.
        The fiscal year 2011 military construction (active + reserve)
    request of $3.9 billion is only slightly larger than fiscal year 2010
    request and remains at a historical high. The program continues the
    effort to ensure facilities are in place to support the Marine Corps'
    end-strength of 202,100 active duty personnel. It also provides further
    investments in accordance with the Defense Policy Review Initiative to
    relocate marines from Okinawa to Guam.
        The fiscal year 2011 Family Housing request of $553 million
    represents a 7 percent increase from the fiscal year 2010 request. The
    Navy and Marine Corps have continued to invest in housing, including
    both the recapitalization of overseas housing as well as additional
    privatization to address housing requirements. Thus, having virtually
    privatized all family housing located in the United States, at overseas
    and foreign locations where we continue to own housing we are investing
    in a ``steady state'' recapitalization effort to replace or renovate
    housing where needed.
        Our BRAC program consists of environmental cleanup and caretaker
    costs at prior BRAC locations, and implementation of BRAC 2005
    recommendations.
        We do not foresee much potential for large revenue from land sales,
    which were used to fund the Legacy BRAC program from fiscal year 2005
    through fiscal year 2008. Thus, we again seek appropriated funds in
    fiscal year 2011 in the amount of $162 million. Should land sale
    revenue accrue from the disposal of the former Naval Station Roosevelt
    Roads in Puerto Rico and some other smaller property sales, we will
    reinvest them to accelerate cleanup at the remaining prior BRAC
    locations.
        The fiscal year 2011 BRAC 2005 budget request of $342 million
    supports only outfitting, realignment, and closure functions as the
    necessary construction projects were funded in prior years. The
    Department has made significant progress during the past year, and to
    date has completed 253 of 488 realignment and closure actions as
    specified in our established business plans and we are on track for
    full compliance with statutory requirements by the September 15, 2011
    deadline.

        Finally, the Department's PB 2011 budget request includes an
    additional $174 million to support Secretary Mabus' aggressive energy
    goals to increase energy security, reduce dependency on fossil fuels,
    and promote good stewardship of the environment. Toward this end, he
    directed an additional investment of $1.4 billion be made through the
    Future Years Defense Program. The PB 2011 program funds three military
    construction projects to build photovoltaic arrays, continues research
    and development in operational energy efficiencies for the tactical
    fleet, and will enable the Services to increase the energy efficiency
    of its infrastructure.
        Here are some of the highlights of these programs.

                             MILITARY CONSTRUCTION

        The DoN's fiscal year 2011 Military Construction program requests
    appropriations of $3.9 billion, including $122 million for planning and
    design and $21 million for Unspecified Minor Construction.
        The active Navy program totals $1.1 billion and includes:
      --$399 million to fund 11 Combatant Commander projects: a General
            Warehouse, a Horn of Africa Joint Operations Center, a base
            Headquarters Facility, and External Road Paving at Camp
            Lemonier, Djibouti; an Operations Support Facility, the third
            phase of the Waterfront Development, and an Ammunition
            Magazines in Bahrain; a Joint POW/MIA Accounting Command
            Facility and a Center for Disaster Management/Humanitarian
            Assistance in Pearl Harbor, Hawaii; a Vehicle Paint Facility at
            Macdill AFB, Florida; and an Air Traffic Control Tower in Naval
            Air Station Rota, Spain.
      --$75 million to fund one Bachelor Quarters at Naval Base San Diego,
            California in support of the elimination of Homeport Ashore
            deficits by 2016 at the Interim Assignment Policy (2 personnel
            per room).
      --$101 million to fund four Nuclear Weapons Security projects: a
            Security Enclave and Waterfront Emergency Power at Submarine
            Base Kings Bay, Georgia; and Waterfront Emergency Power and
            Limited Area Emergency Power at Naval Base Kitsap, Washington.
      --$148 million to fund five projects to achieve Initial/Final
            Operational Capability requirements for new systems: an
            Aviation Simulator Training Facility at Naval Air Facility
            Atsugi, Japan; a Broad Area Maritime Surveillance Testing and
            Evaluation Facility at Naval Air Station Patuxent River,
            Maryland; a T-6 Capable Runway Extensions at Outlying Landing
            Fields (OLF) Barin and Summerdale, Alabama; a MH-60 R/S Rotary
            Hangar at Naval Base Coronado, California; and Upgrades to
            Piers 9/10 at Naval Station Norfolk, Virginia.
      --$196 million to fund additional critical Navy Priorities: an
            Electromagnetic Sensor Facility at Naval Station Newport, Rhode
            Island; the second phase of the Agile Chemical Facility at
            Indian Head, Maryland; a Pier Replacement and Dredging at Naval
            Base San Diego, CA; a Laboratory Expansion at Naval Base
            Kitsap, Washington; and a Pier Upgrade at Naval Station
            Norfolk, Virginia.
      --$119 million to fund follow-on increments of projects previously
            incremented by Congress: the final increment of the Limited
            Area Production and Storage Facility at Naval Base Kitsap,
            Washington; and the second increment of the Pier 5
            Recapitalization at Norfolk Naval Shipyard, Virginia.
      --$57 million for planning and design efforts.
        The active Marine Corps program totals $2.8 billion of which $1.25
    billion is for Grow the Force and $452 is for design and construction
    to support the relocation of marines to Guam.
      --$630 million for the construction of unaccompanied housing at Camp
            Pendleton, Twentynine Palms, Hawaii, Cherry Point, Camp
            Lejeune, and Quantico in a continuation of the Commandant of
            the Marine Corps' initiative to improve the quality of life for
            single marines;
      --$74 million to provide quality of life facilities such as dining
            facilities and physical fitness centers at Beaufort, Hawaii,
            and Camp Lejeune;
      --$56 million to construct student billeting for the Basic School in
            Quantico, Virginia;
      --$357 million to build infrastructure to support new construction.
            These projects include communications upgrades, electrical
            upgrades, natural gas systems, drinking and wastewater systems.
            These projects will have a direct effect on the quality of life
            of our marines. Without these projects, basic services
            generally taken for granted in our day-to-day lives, will fail
            as our marines work and live on our bases;
      --$781 million to fund operational, maintenance, and storage support
            projects such as those needed for the MV-22 aircraft at New
            River and Miramar and Joint Strike Fighter at Yuma; and
            operational units in Camp Lejeune, Cherry Point, Camp
            Pendleton, and Hawaii;
      --$195 million to provide training facilities for aviation units at
            Camp Pendleton, Beaufort, and Yuma;
      --$50 million to support professional military education by providing
            facilities at Marine Corps University in Quantico;
      --$25 million to provide encroachment control at Beaufort and Bogue
            Field;
      --$30 million to provide military construction-funded photovoltaic
            power plants at Camp Pendleton, San Diego, and Camp Lejeune;
      --$75 million to support on- and off-load equipment operations at
            Blount Island;
      --$427 million for facilities necessary to support the relocation of
            marines to Guam; and
      --$64 million for planning and design efforts.
        With these new facilities, marines will be ready to deploy and
    their quality of life will be enhanced. Without them, quality of work,
    quality of life, and readiness for many marines will have the potential
    to be seriously degraded.
        The Navy and Marine Corps Reserve Military Construction
    appropriation request is $61 million, including $2 million for planning
    and design efforts, to construct a Reserve Training Facility at Yakima,
    Washington, a Vehicle Maintenance Facility at Twenty-Nine Palms,
    California, a Joint Air Traffic Control Tower at Joint Reserve Base New
    Orleans, Louisiana, and an Ordnance Cargo Logistics Training Complex at
    Naval Weapons Station Yorktown, Virginia.

             FULLY FUNDED AND INCREMENTALLY FUNDED MILCON PROJECTS

        Our fiscal year 2011 budget request complies with Office of
    Management and Budget Policy and the DOD Financial Management
    Regulation that establishes criteria for the use of incremental
    funding. The use of incremental funding in this budget has been
    restricted to the continuation of projects that have been incremented
    in prior years. Otherwise, all new projects are fully funded or are
    complete and usable phases. However, as the cost of complex piers and
    utilities systems rise above the $100 million and even $200 million
    threshold, compliance with the full-funding policy drives both Services
    to make hard choices regarding which other equally critical projects
    must be deferred into the next year.

                             FACILITIES MANAGEMENT

    Facilities Sustainment, Restoration and Modernization (SRM)
        The Department of Defense uses a Sustainment model to calculate
    life cycle facility maintenance and repair costs. These models use
    industry-wide standard costs for various types of buildings and
    geographic areas and are updated annually. Sustainment funds in the
    Operation and Maintenance accounts are used to maintain facilities in
    their current condition. The funds also pay for preventative
    maintenance, emergency responses for minor repairs, and major repairs
    or replacement of facility components (e.g. roofs, heating and cooling
    systems). The fiscal year 2011 budget request funds sustainment at 92
    percent and 90 percent for the Navy and Marine Corps, respectively. For
    Navy, funding includes Joint Basing investments which requirements have
    yet to transfer. Once they do, the rate will revert to 90 percent.
        Restoration and modernization (R&M) provides major upgrades of our
    facilities using Military Construction, Operation and Maintenance, Navy
    Working Capital Fund, and BRAC, as applicable. Although OSD has
    determined a condition-based model (``Q-ratings'') is the best approach
    to prioritize funding, establishing metrics has been challenging.
    Nonetheless, in fiscal year 2011, the Department of Navy is investing
    nearly $1.3 billion in R&M funding.

    Encroachment Partnering
        The Department of the Navy has an aggressive program to manage and
    control encroachment, with a particular focus on preventing
    incompatible land use and protecting important natural habitats around
    installations and ranges. A key element of the program is Encroachment
    Partnering (EP), which involves cost-sharing partnerships with States,
    local governments, and conservation organizations to acquire interests
    in real property adjacent and proximate to our installations and
    ranges. Encroachment Partnering Agreements help prevent development
    that would adversely impact existing or future missions. These
    agreements also preserve important habitat near our installations in
    order to relieve training or testing restrictions on our bases. The
    program has proven to be successful in leveraging Department of Defense
    and Department of Navy resources to prevent encroachment.
        For fiscal year 2009, the Navy acquired restrictive easements over
    3,091 acres. The acquisitions were funded by $7.1 million from the
    Department of Defense Readiness and Environmental Protection Initiative
    (REPI) program, $2 million of Navy funds, and $9.25 million from the
    encroachment partners. The Marine Corps during fiscal year 2009
    acquired easements over 1,777 acres. These acquisitions were funded by
    $7.7 million from REPI, $6.2 million from Navy funds, and $7.2 million
    from the encroachment partners. The encroachment program has
    successfully initiated restrictive easement acquisitions at 13 Navy
    installations and 7 Marine Corps installations.

    Compatible Development
        Vital to the readiness of our Fleet is unencumbered access to
    critical water and air space adjacent to our facilities and ranges. An
    example is the outer continental shelf (OCS) where the vast majority of
    our training evolutions occur. The Department realizes that energy
    exploration and off-shore wind development play a crucial role in our
    Nation's security and are not necessarily mutually exclusive endeavors.
    Therefore, we are engaging with the other services, the Secretary of
    Defense's office, and the Department of Interior to advance the
    administration's energy strategy. We are poised to coordinate with
    commercial entities, where feasible, in their exploration and
    development adjacent to installations and our operating areas along the
    OCS that are compatible with military operations. However, we must
    ensure that obstructions to freedom of maneuver or restrictions to
    tactical action in critical range space do not measurably degrade the
    ability of naval forces to achieve the highest value from training and
    testing.
        The Department of the Navy has an aggressive program to manage and
    control encroachment, with a particular focus on preventing
    incompatible land use and protecting important natural habitats around
    installations and ranges. A key element of the program is Encroachment
    Partnering (EP), which involves cost-sharing partnerships with States,
    local governments, and conservation organizations to acquire interests
    in real property adjacent and proximate to our installations and
    ranges. The Department prevents development that is incompatible with
    the readiness mission, and our host communities preserve critical
    natural habitat and recreational space for the enjoyment of residents.
    Navy and Marine Corps have ongoing EP agreements at 14 installations
    and ranges nationwide, with additional agreements and projects planned
    in fiscal year 2010. EP has been a highly effective tool for addressing
    encroachment threats from urban development and is a win-win for the
    Department and our host communities.
        In fiscal year 2008, Navy and Marine Corps completed partnership
    acquisitions on 16,662 acres. Funding for those purchases of land and
    easements included a combined contribution from DOD and DoN of $11.72
    million, which was matched by similar investments from partner
    organizations. In fiscal year 2009, Navy and Marine Corps received an
    additional $19.78 million from the DOD Readiness and Environmental
    Protection Initiative program, which will be combined with funding from
    the Department and our partner organization.

                                 ENERGY REFORM

        The Department of the Navy (DoN) is committed to implementing a
    balanced energy program that exceeds the goals established by the
    Energy Independence and Security Act of 2007, Energy Policy Act of
    2005, National Defense Authorization Act of 2007 and 2010, Executive
    Orders 13423 and 13514. We place a strong emphasis on environmental
    stewardship, reducing overall energy consumption, increasing energy
    reliability, and reducing our dependence on fossil fuels. The
    Department is a recognized leader and innovator in the energy industry
    by the Federal Government and private sector as well. Over the past 9
    years, DoN has received 28 percent of all of the Presidential awards
    and 30 percent of all of the Federal energy awards. Additionally, DoN
    has received the Alliance to Save Energy ``Star of Energy Efficiency''
    Award and two Platts ``Global Energy Awards'' for Leadership and Green
    Initiatives.

    Organization and Commitment
        Increased Energy Efficiency is a Department of Defense (DOD) High
    Priority Performance Goal. Moreover, the Secretary of the Navy (SECNAV)
    is whole-heartedly committed to the energy effort and it is one of his
    top three initiatives for the Department. The Secretary established a
    Deputy Assistant Secretary of the Navy for Energy (DASN-Energy) to
    consolidate the Department's operational and installation energy
    missions. The consolidation of both operational and installation energy
    portfolios under one director is unique to the Department of the Navy.
    The DASN-Energy will be a career member of the Senior Executive Service
    who will report directly to the ASN (I&E) and will be able to
    coordinate across the Department to develop overarching policy, provide
    guidance, oversee the continued development of new ideas and align
    existing programs. In turn, each of the Services has established an
    energy management office to implement the Secretary's guidance. Within
    the Chief of Naval Operations (CNO) organization, a Navy Energy
    Coordination Office (NECO) was established to develop and
    institutionalize the Navy's Energy Strategy. Within the Commandant of
    the Marine Corps (CMC) organization, an Expeditionary Energy Office was
    established to drive energy efforts and initiatives within the
    expeditionary forces on the ground in theater.
        From the secretary down to the deck plate sailor and the marine in
    the field, the Department is committed to meeting our aggressive energy
    goals. We all view energy as an invaluable resource that provides us
    with a strategic and operational advantage.

    Energy Goals
        The key statutory and regulatory goals relevant to installation
    energy consumption require the following:
      --Reduce energy intensity (BTUs per square foot) by 3 percent per
            year, or 30 percent overall, by 2015 from the 2003 baseline
            [Energy Independence and Security of 2007, or EISA] [this
            includes an 18 percent reduction by the end of fiscal year 2011
            in accordance with DOD's High Priority Performance Goals in the
            President's Budget];
      --Increase use of renewable energy to 7.5 percent in 2013 and beyond
            (Energy Policy Act of 2005, or EPACT); and produce or procure
            25 percent of all electric energy from renewable sources by the
            end of 2025 [National Defense Authorization Act of 2007] [this
            includes the DOD's High Priority Performance Goal of 14.3
            percent by 2011]; and
      --Reduce consumption of petroleum (gasoline and diesel) by non-
            tactical vehicles by 30 percent by 2020 [Executive Order 13514,
            October 2009].
        However, in October of 2009, Secretary Mabus established far more
    aggressive goals for the Department. For installations, he directed
    that 50 percent of our shore energy will come from alternative sources
    and that by 2015 the Department will reduce fleet vehicle petroleum
    usage by greater than 50 percent. Based on these ambitious energy
    goals, we are developing our strategic roadmap and a set of energy
    directives that will provide guidance and direction to the Navy and
    Marine Corps. We are also developing baseline metrics, milestones,
    tools and methodologies to measure and evaluate progress towards
    meeting the Secretary's goals. Additionally, we are documenting our
    past and current energy use for tactical platforms and shore
    installations. We are making investments, allocating resources,
    developing possible legislation, institutionalizing policy changes,
    creating public-private partnerships, and pursuing technology
    development required to meet these goals. These investments will
    include $28.23 million in Energy Conservation Investment Program (ECIP)
    projects, which have a savings to investment ratio of 2.94.

                                    HOUSING

        The following tenets continue to guide the Department's approach to
    housing for sailors, marines, and their families:
      --All service members, married or single, are entitled to quality
            housing; and
      --The housing that we provide to our personnel must be fully
            sustained over its life.
        A detailed discussion of the Department's family and unaccompanied
    housing programs, and identification of those challenges, follows:

                                 FAMILY HOUSING

        As in past years, our family housing strategy consists of a
    prioritized triad:
      --Reliance on the Private Sector.--In accordance with longstanding
            DOD and DoN policy, we rely first on the local community to
            provide housing for our sailors, marines, and their families.
            Approximately three out of four Navy and Marine Corps families
            receive a Basic Allowance for Housing (BAH) and own or rent
            homes in the community. We determine the ability of the private
            sector to meet our needs through the conduct of housing market
            analyses that evaluate supply and demand conditions in the
            areas surrounding our military installations.
      --Public/Private Ventures (PPVs).--With the strong support from this
            Committee and others, we have successfully used PPV authorities
            enacted in 1996 to partner with the private sector to help meet
            our housing needs through the use of private sector capital.
            These authorities allow us to leverage our own resources and
            provide better housing faster to our families. Maintaining the
            purchasing power of BAH is critical to the success of both
            privatized and private sector housing.
      --Military Construction.--Military construction (Milcon) will
            continue to be used where PPV authorities don't apply (such as
            overseas), or where a business case analysis shows that a PPV
            project is not feasible.
        Our fiscal year 2011 budget includes $186 million in funding for
    family housing construction, improvements, and planning and design.
    This amount includes $107 million for the Government investment in
    continued family housing privatization at Marine Corps Bases Camp
    Pendleton, California and Camp Lejeune, North Carolina. The request for
    Camp Lejeune includes funding for an addition to a Department of
    Defense school. It also includes $76 million for the replacement or
    revitalization of Navy and Marine Corps housing, primarily in Japan and
    Cuba where the military housing privatization authorities do not apply.
    Finally, the budget request includes $366 million for the operation,
    maintenance, and leasing of remaining Government-owned or controlled
    inventory.
        As of the end of fiscal year 2009, we have awarded 33 privatization
    projects involving over 62,000 homes. These include over 42,000 homes
    that will be constructed or renovated. (The remaining homes were
    privatized in good condition and did not require any work.) Through the
    use of these authorities we have secured approximately $9 billion in
    private sector investment from approximately $900 million of our funds,
    which represents a ratio of over nine private sector dollars for each
    taxpayer dollar.
        While the military housing privatization initiative has been
    overwhelmingly successful, we can continue to work with our partners to
    address challenges associated with current economic conditions. In some
    cases, projects may need to be restructured to better match supply with
    demand and to ensure that the housing will continue to be sustained and
    recapitalized over the long term.
        Perhaps the most important measure of success of our privatization
    program has been the level of satisfaction on the part of the housing
    residents. To gauge their satisfaction, we used customer survey tools
    that are well established in the marketplace. As shown in the following
    chart, the customer surveys indicate a steady improvement in member
    satisfaction after housing is privatized.

    Unaccompanied Housing
        Our budget request includes over $700 million in funding for the
    construction of unaccompanied housing to support single sailors and
    marines. This includes over $600 million of funding to support
    requirements associated with the Marine Corps ``Grow the Force''
    initiative and to continue implementation of the Commandant of the
    Marine Corps program to construct sufficient housing so that no more
    than two single marines are required to share a sleeping room. The
    budget request also includes $75 million to support the Chief of Naval
    Operations commitment to achieve the Navy's ``Homeport Ashore''
    objective by 2016.
        The following are areas of emphasis within the Department regarding
    housing for single sailors and marines:
      --Provide Homes Ashore for Our Shipboard Sailors.--The Homeport
            Ashore initiative seeks to provide a barracks room ashore
            whenever a single sea duty sailor is in his or her homeport, so
            they need not live on the ship. The Navy has made considerable
            progress towards achieving this goal through military
            construction, privatization, and intensified use of existing
            barracks capacity. The Chief of Naval Operations is committed
            to providing housing ashore for all junior sea duty sailors by
            2016 at the Interim Assignment Policy standard (55 square feet
            of space per person). The Navy's long term goal is to achieve
            the OSD private sleeping room standard (90 square feet per
            person).
      --Commandant's BEQ Initiative.--It is the Commandant of the Marine
            Corps' priority to ensure single marines are adequately housed.
            Thanks to your previous support of this initiative, the Marine
            Corps will make significant progress toward fulfilling this
            priority. Milcon funding since fiscal year 2008 for the Marine
            Corps barracks initiative will result in the construction of
            approximately 19,800 new permanent party spaces at multiple
            Marine Corps installations. Your continued support of this
            initiative in our fiscal year 2011 proposal will allow us to
            construct an additional 5,000 new permanent party barracks
            spaces. With this funding we will stay on track to meet our
            2014 goal. The fiscal year 2011 request for bachelor housing
            will provide 13 barracks projects at Camp Lejeune and Cherry
            Point, North Carolina, Twenty-Nine Palms, and Camp Pendleton,
            California, Hawaii, and Quantico, Virginia. We are also
            committed to funding the replacement of barracks' furnishings
            on a 7-year cycle as well as the repair and maintenance of
            existing barracks to improve the quality of life of our
            marines. These barracks will be built to the 2+0 room
            configuration, as have all Marine Corps barracks since 1998.
            This is consistent with the core Marine Corps tenets for unit
            cohesion and teambuilding.

    Unaccompanied Housing Privatization
        The Navy has also executed two unaccompanied housing privatization
    projects using the pilot authority contained in section 2881a of title
    10, United States Code. In March we cut the ribbon on the Pacific
    Beacon project in San Diego. Pacific Beacon includes 258 conveyed units
    targeted for unaccompanied E1-E4 sea duty sailors and 941 newly
    constructed dual master suite units targeted for E4-E6 sailors.
        The second unaccompanied housing privatization project is in
    Hampton Roads (executed in December 2007) and included the conveyance
    of 723 units in seven buildings on Naval Station and Naval support
    Activity Norfolk and the construction of 1,190 dual master suite units.
    The last units are scheduled for completion in 2010.
        With these two pilot projects, we have secured approximately $600
    million in private sector investment from approximately $80 million of
    our funds, which represents a ratio of over seven private sector
    dollars for each taxpayer dollar.
        Based on resident surveys, the residents of privatized
    unaccompanied housing at both San Diego and Hampton Roads are very
    satisfied with service received from the privatization partner as well
    as the condition of the units. San Diego won an industry award for
    excellence in providing customer satisfaction.

                         RELOCATING THE MARINES TO GUAM

        The fiscal year 2011 budget request includes $452 million to design
    and construct facilities in support of the relocation. The projects
    funded by this level of investment provide the horizontal
    infrastructure (utilities, site improvements, etc.) necessary to enable
    the vertical construction programmed for fiscal year 2012 and beyond.
    The Government of Japan, in its J-fiscal year 2010 budget (which runs
    April 1, 2010 through March 31, 2011) has requested a comparable amount
    of $498 million and we expect to receive their contribution in June.
    The graph at left identifies the projects each funding stream
    constructs.

        The Marine Corps relocation, along with other DOD efforts to
    realign forces and capabilities to Guam, represents a unique
    opportunity to strategically realign the U.S. force posture in the
    Pacific for the next 50 years. This is a major effort and one we must
    get right. The Department of Defense recognizes that the condition of
    Guam's existing infrastructure could affect both our ability to execute
    the program schedule and quality of life on the island. If the issues
    surrounding existing infrastructure and other major social issues
    impacting Guam are left unaddressed by the Federal Government in this
    strategic realignment, we risk creating disparity between conditions
    on- and off-base, losing the support of the people of Guam, and
    adversely affecting our ability to achieve our mission. The Department
    of Defense is committed to ensuring this does not happen, and is
    leading the effort to coordinate an interagency ``whole-of-government
    approach'' to solve Guam's many issues. Our strategy is to identify
    options that will support DOD missions, provide the widest possible
    benefit to the people of Guam, be technically and financially
    supportable by utilities providers and rate payers, and be acceptable
    to Government of Guam and regulatory officials. DOD recently held a
    meeting of the Economic Adjustment Committee (EAC) as recommended in a
    recent Government Accountability Office review, to discuss with Federal
    agencies and departments a plan for identifying and addressing Guam's
    priority needs.
        Construction capacity studies, assessments of socioeconomic
    impacts, and the development of the Environmental Impact Statement
    (EIS) have demonstrated that, in particular, Guam's road network,
    commercial port, and utilities systems are in need of upgrades. DOD is
    contributing to funding upgrades to the island's public roadways,
    bridges and intersections through the Defense Access Road (DAR)
    program. Road improvement projects have been certified by
    Transportation Command's Surface Deployment and Distribution Command
    under the DAR program for fiscal year 2011, following up on the
    projects funded in fiscal year 2010. Existing deficiencies in the
    island's road system and long-term traffic impacts due to the projected
    population increase are being considered in partnership between Guam
    Department of Public Works and the U.S. Federal Highway Administration.
    These efforts are occurring in parallel in order to ensure
    compatibility and mutual benefit to DOD and the Guam community.
        The commercial port, which is vital to this isolated island
    community, has not undergone any major improvements since it began
    operations 40 years ago. The port requires near and long-term
    improvements to support the military buildup and future community
    growth. The Port Authority of Guam (PAG) and the U.S. Maritime
    Administration (MARAD) signed a memorandum of understanding to improve
    the port by developing an adequate master plan and implementation of a
    Capital Improvement Plan. These plans will develop the port into a
    regional shipping hub that will serve both military and civilian needs
    in the region in the long term. With recommended upgrades and
    improvements to materials-handling processes, the Port of Guam should
    be able to accommodate throughput to sustain the expected $1.5-2.0
    billion per year in construction volume. DOD, MARAD, PAG, the
    Government of Guam, and Federal agencies are currently working to
    identify a funding source which could support the near-term
    improvements required at the port.
        Of the total $6.09 billion Japanese commitment included in the
    Realignment Roadmap, $740 million is for developing electric, potable
    water, sewer, and solid waste infrastructure in support of the
    relocating Marine Corps forces. Analysis of utilities options indicates
    that developing new, stand-alone systems will not be cost-effective.
    DOD is collaborating with Guam's utilities providers to understand
    their needs and to determine the feasibility of water, wastewater,
    solid waste and power solutions that are mutually beneficial and
    acceptable to DOD, the civilian community and the regulatory agencies.
    We are actively working with Guam's Consolidated Commission on
    Utilities and utilities providers (Guam Power Authority, Guam Water
    Authority), Guam EPA, and U.S. EPA to develop the best technical
    solutions for utilities systems and facilities. Specific to wastewater,
    Guam's current system requires upgrades to both increase its capacity
    and to meet standards for primary and secondary treatment. These
    upgrades are critical enablers to the construction program and we are
    anticipating funding from Japan to meet these requirements. We are also
    working with the Department of Interior, U.S. EPA, and the Department
    of Agriculture on potential funding opportunities using a whole-of-
    government approach to addressing island-wide utilities solutions.
        DOD's Office of Economic Adjustment (OEA) has provided the
    Government of Guam with grants totaling more than $10 million to
    support environmental, financial and planning studies; staffing; and
    community outreach programs.
        We will seek to maximize opportunities for U.S. workers, including
    the existing workforce on Guam. Nonetheless, we recognize the potential
    for significant socioeconomic effects on Guam with the introduction of
    off-island workers who will support the construction program. In order
    to minimize negative effects, we worked closely with the Government of
    Guam, Federal agencies, and other stakeholders to develop requirements
    which would mitigate environmental and social impacts associated with
    the anticipated influx of off-island construction workers. Our
    acquisition strategy includes contract provisions requiring contractors
    to provide concrete, feasible plans and resources to mitigate potential
    socioeconomic impacts. In awarding construction contracts a workforce
    management plan, is one of three major technical factors in the source
    selection criteria.
        Among the areas we are evaluating in the workforce management
    source selection criteria are management of medical, housing, dining,
    transportation, and security for workers, taking into account potential
    long-term positive side benefits that different solutions may have for
    the Guam community.

    Environmental Impact Statement
        As it is designed to do, the National Environmental Policy Act
    (NEPA) process and associated studies are helping us identify and
    address environmental issues and constraints and develop effective
    mitigation strategies. A key milestone to executing the realignment
    within the targeted timeframe is achieving a Record of Decision on a
    schedule that allows for construction to begin in fiscal year 2010. The
    target for a Record of Decision is August 2010. On November 20, 2009,
    we released the Draft EIS for public review with a 90-day comment
    period. This comment period, which was twice the amount of time
    required under NEPA, was used because we were committed to ensuring
    that all interested parties have full opportunity to review and provide
    comment on the DEIS. We realize there are significant and complicated
    issues that need to be studied in preparing the Final EIS and reaching
    a Record of Decision (ROD) on the realignment effort. We also recognize
    the interests of the public need to be protected. However, we remain on
    an aggressive schedule to finish the Final EIS by the summer of 2010,
    with ROD following. Other agencies have identified significant issues,
    including the potential long-term impacts to environmental resources,
    that we are analyzing along with all other comments received. To that
    end, we are currently analyzing all public comments including those
    received from other resource agencies and developing strategies for
    addressing concerns raised in the Final EIS. We are committed to
    developing effective and appropriate mitigation. Additionally, we will
    continue to meet with resource agencies as we have done throughout the
    development of the EIS to elevate and resolve several technical and
    policy issues. We will share with the Congress significant issues that
    emerge during the process of developing the final EIS.

                    PRIOR BRAC CLEANUP AND PROPERTY DISPOSAL

        The BRAC rounds of 1988, 1991, 1993, and 1995 were a major tool in
    reducing our domestic installation footprint and generating savings.
    All that remains is to complete the environmental cleanup and property
    disposal on portions of 16 of the original 91 bases and to complete
    environmental cleanup, including long term monitoring at 22
    installations that have been disposed.

    Property Disposal
        We disposed of 154 acres of real property in fiscal year 2009, for
    a total of 93 percent of real property disposed in the first four
    rounds of BRAC. We continue to use the variety of the conveyance
    mechanisms available for Federal Property disposal, including the
    Economic Development Conveyance (EDC) that was created for BRAC
    properties. Of the real property the Department has disposed, 91
    percent of this property was conveyed at no cost. From the remaining 9
    percent of conveyed property, the Department has received over $1.1
    billion in land sale revenues. We have used these funds to accelerate
    environmental cleanup and were able to finance the entire DON Prior
    BRAC effort, from fiscal year 2005 through fiscal year 2008.
        Future opportunities for land sale revenues, however, are very
    limited, and we continue our request for appropriated funds in fiscal
    year 2011. Our budget request of $162 million will enable us to
    continue disposal actions and meet the minimum legal requirements for
    environmental clean up.

    Prior BRAC Environmental Cleanup
        The Department has now spent about $4.3 billion on environmental
    cleanup, environmental compliance, and program management costs at
    prior BRAC locations through fiscal year 2009. Our remaining
    environmental cost to complete for fiscal year 2010 and beyond is
    approximately $1.4 billion. This includes $160 million cost growth
    which is due in part to additional munitions cleanup at Naval Air
    Facility Adak, AK and Naval Shipyard Mare Island, CA, clean up at Naval
    Station Roosevelt Roads, Puerto Rico, and additional long term
    monitoring program-wide. The increase is also associated with
    additional radiological contamination at Naval Station Treasure Island,
    CA, Naval Air Station Alameda, CA, and Naval Shipyard Mare Island, CA.

    Naval Station Treasure Island, CA
        We would like to highlight a breakthrough on negotiations for the
    EDC of Naval Station Treasure Island. Negotiations had been ongoing
    with the city since 2007. Due to the disparity of the DON and City
    valuations, many compensation options were reviewed to convey the
    property while still obtaining Fair Market Value (FMV). The Navy had
    previously offered deferred compensation and percentages of gross
    revenue. The city had offered profit participation subordinate to a
    guaranteed return to developers. With adoption of language in the
    fiscal year 2010 National Defense Authorization Act, Congress enacted
    new EDC language that allows flexibility in transfer terms for EDCs
    including accepting profit participation structures.
        Utilizing this authority, we were able to announce in December that
    an agreement in principle was reached with the City of San Francisco to
    convey 996 acres of the former Naval Station Treasure Island. The
    agreement guarantees $55 million to the Navy paid over 10 years with
    interest and an additional $50 million paid once the project meets a
    return of 18 percent. Then after an additional 4.5 percent return to
    investors (22.5 percent total), the Navy would receive 35 percent of
    all proceeds. This deal represents a unique opportunity to spur
    development, while still providing a guaranteed payment to the Navy as
    well as a share in the benefit of what both the City and the Navy
    expect to be a successful redevelopment and job generating project.
        The environmental cleanup of Treasure Island is nearing completion.
    Once the City finalizes California Environmental Quality Act
    documentation and approvals with the Board of Supervisors in late 2010
    or early 2011, we will be in position for the clean transfer of more
    than 75 percent of the base. The remaining cleanup includes the
    continued treatment of two small groundwater plumes and removal of low
    level radioactive contamination. These projects and the remaining
    transfer are expected to be complete well before the land is needed for
    subsequent phases of the redevelopment project.

                            BRAC 2005 IMPLEMENTATION

        The Department has made significant progress during the past year,
    and to date has completed 253 of 488 realignment and closure actions as
    specified in our established business plans. A number of construction
    projects have already been completed or are well on their way. The PB
    2011 budget request of $342 million will enable us to continue
    outfitting buildings, realigning functions, and closing bases in
    accordance with our business plans. Although all 59 of Department of
    the Navy-led business plans have already been approved, four additional
    plans with Navy equity led by other services have been approved. Thus,
    the Department's BRAC 2005 Program is on track for full compliance with
    statutory requirements by the September 15, 2011 deadline.

    Accomplishments
        In total, the Department has awarded 105 of 117 BRAC construction
    projects with a combined value of $1.8 billion. The final 12 projects
    worth approximately $303 million are on schedule for award this year.
    Some noteworthy achievements include:
      --Seven BRAC construction projects, programmed at $211 million, have
            been awarded and are under construction at Joint Base McGuire-
            Dix-Lakehurst, NJ. This work supports the relocation of units,
            aircraft, and equipment from the closure of Naval Air Station
            Joint Reserve Base Willow Grove, PA. The Navy supported the
            full operational capability of Joint Base McGuire-Dix-Lakehurst
            and successfully transferred all Navy real property in
            September 2009.
      --Construction projects valued at over $100 million have been awarded
            to support the Consolidation of Correctional Facilities into
            Joint Regional Correctional Facilities. New level II (Medium
            Security) correctional facilities are being constructed at
            Miramar, CA and Chesapeake, VA and an addition to the Navy's
            Brig in Charleston, SC is underway.

    Land Conveyances and Lease Terminations
        By the end of fiscal year 2009, the Department disposed of 42
    percent \1\ of the property that was slated for closure in BRAC 2005.
    These disposal actions were completed via a combination of lease
    terminations, reversions, public benefit conveyances, and Federal and
    DOD agency transfers. Of interest for fiscal year 2009 is the complete
    disposal of Naval Air Station Atlanta. Thirty seven acres were returned
    to the Air Force and 107 acres were transferred to the Army for use by
    the Georgia National Guard. Last year we also disposed of the Navy
    Reserve Center in Orange, TX for use by the community as a port
    facility.
    ---------------------------------------------------------------------------
        \1\ The percent disposed is lower than stated last year as we added
    over 300 acres to the amount to be disposed due to property becoming
    available at NS Newport and completion of legal surveys over the past
    year.
    ---------------------------------------------------------------------------
        The most significant action we have planned for 2010 is the
    reversion of the main base at Naval Station Ingleside, TX. We have been
    working closely with the Port of Corpus Christi to complete this action
    by the end of April, when the base will operationally close, 5 months
    earlier than planned. The 2010 Plan also includes transfer of real
    property at Naval Air Station Brunswick, the Navy Marine Corps Reserve
    Center Tacoma, WA, the Inspector Instructor Facility Rome, GA, and the
    last parcel at Navy Reserve Center Duluth, MN.

    Naval Support Activity New Orleans, LA
        Construction for the new building that will house Headquarters,
    Marine Forces Reserve and Marine Corps Mobilization Command is well
    underway in the future Federal City. To support the closure of Naval
    Support Activity New Orleans and the relocation of base operating
    support and tenant activities to Naval Air Station Joint Reserve Base
    New Orleans, nine construction projects have been completed and another
    five are on-going.

    Naval Air Station Brunswick, ME
        The Department's largest BRAC 2005 operational action will close
    Naval Air Station Brunswick, ME, and consolidate the East Coast
    maritime patrol operations in Jacksonville, FL. The newly constructed
    hangar in Jacksonville, FL, completed in May 2009, is now home to all
    five relocated P-3 squadrons. It will also support the future
    transition to the P-8 Poseidon aircraft. Runway operations in Brunswick
    ceased in February 2010.

    Naval Air Station Joint Reserve Base Willow Grove, PA
        In 2007, legislation was enacted directing the Department to
    transfer Naval Air Station Joint Reserve Base Willow Grove, PA to the
    Air Force, who would then convey property to the Commonwealth of
    Pennsylvania for the operation of a Joint Interagency Installation.
    Since that time the Department and the Air Force have worked with the
    Commonwealth on the actions required to implement the transfer of real
    property.
        In November 2009, Governor Rendell of the Commonwealth of
    Pennsylvania informed the Secretary of Defense that the Commonwealth
    would no longer pursue the Joint Interagency Installation because of
    fiscal constraints. Based on that decision, the closure of Naval Air
    Station Joint Reserve Base Willow Grove will follow the established
    reuse planning process. To that end, the Department has initiated
    Federal Screening with other DOD and Federal agencies and is working
    with the LRA, Horsham Township, on its reuse planning efforts.

    Joint Basing
        All four Joint Base Memorandums of Agreement (MOAs) where the
    Department is the lead component have now been approved. The MOA for
    each joint base defines the relationships between the components, and
    commits the lead component to deliver installation support functions at
    approved common standards. Resources including funding, personnel, and
    real property transfer to the lead component. The MOAs are reviewed
    annually for mission, manpower, and financial impacts and any needed
    resource adjustments. Joint Basing has two implementation phases. Phase
    I installations--Little Creek-Fort Story and Joint Region Marianas--
    reached full operational capability in October 2009, and Phase II
    installations--Anacostia-Bolling and Pearl Harbor-Hickam--are planned
    for October 2010.

    Environmental Cost To Complete and Financial Execution
        The Department's remaining environmental liabilities for BRAC 2005
    are substantially less than in previous rounds of BRAC given the
    relatively few number of closures, the absence of major industrial
    facilities, and the extensive site characterization, analysis, and
    cleanup that has occurred over the last several decades. Over the last
    year, we spent $8 million in cleanup at BRAC 2005 locations. The
    majority of this funded environmental activities at Naval Air Station
    Brunswick, ME and Naval Weapons Station Seal Beach Detachment Concord,
    CA. Our remaining environmental cost to complete for fiscal year 2010
    and beyond is $103 million.
        The Department is achieving an execution rate of our fiscal year
    2006-2009 funds of nearly 90 percent. We have realized bid savings on
    some construction projects and have primarily used these savings to
    offset other construction project increases.

    Challenges
        We are scheduled to meet the September 15, 2011 deadline and will
    continue to manage ongoing construction, outfitting and relocation
    efforts closely. Many of our construction projects require either
    special certifications or accreditations before occupancy to include
    DOD Explosive Safety Board approvals, accreditation of correctional
    facilities or certification of Sensitive Compartmented Information
    Facilities within constructed facilities.
        We plan to continue to work closely with the other military
    services and defense agencies on complex relocation actions that
    require close coordination. While they remain on track for timely
    completion, we must maintain effective and continuous coordination to
    succeed.

                  MEETING THE CONSTRUCTION EXECUTION CHALLENGE

        While our investment in infrastructure continues at a record
    breaking level, the Naval Facilities Engineering Command (NAVFAC) has
    demonstrated its ability to accomplish the program, and more. The
    Command's execution rate for fiscal year 2009 was nothing short of
    phenomenal; particularly considering it awarded the majority of the
    additional $1.8 billion American Recovery and Reinvestment Act program
    by the end of the calendar year while maintaining an execution rate of
    90 percent for the regular program. Only 10 ARRA projects remain to be
    awarded, including the new Naval Hospital at Camp Pendleton, CA.
        NAVFAC has a comprehensive acquisition strategy for executing the
    Guam realignment program, with plans to award three separate small
    business Multiple Award Construction Contracts (MACCs) and two MACCs
    for unrestricted competition. A Small Business MACC will be awarded
    this Spring, a Small Business 8(A) MACC will be solicited in March, and
    a HUBZONE MACC has been awarded. Additionally, there will be an
    unrestricted competitively bid MACC for U.S. funded projects, with
    another MACC planned for Japanese funded construction. Using smart
    acquisition strategies and leveraging resources across the enterprise,
    NAVFAC is fully capable of meeting the demand for its services.

                                   CONCLUSION

        Our Nation's Sea Services continue to operate in an increasingly
    dispersed environment to support the Maritime Strategy and ensure the
    freedom of the seas. We must continue to transform and recapitalize our
    shore infrastructure to provide a strong foundation from which to re-
    supply, re-equip, train, and shelter our forces. With your support of
    the Department's fiscal year 2011 budget request, we will be able to
    build and maintain facilities that enable our Navy and Marine Corps to
    meet the diverse challenges of tomorrow.
        Thank you for the opportunity to testify before you today. I look
    forward to working with you to sustain the war fighting readiness and
    quality of life for the most formidable expeditionary fighting force in
    the world.

        Senator Hutchison. General Payne.
        General Payne. Senator, in that you have our written
    statement, I just want to thank you for your steadfast support
    and the opportunity to be here today. And I look forward to
    your questions.
        Senator Hutchison. Thank you.
        General Payne. Yes, ma'am.
        Senator Hutchison. Admiral Mossey.
        Admiral Mossey. Senator, I would echo what General Payne
    said. Thank you for the subcommittee's support and I am ready
    to answer any questions you may have.

                                      GUAM

        Senator Hutchison. Okay. I think I am going to focus on
    Guam because that is clearly, I think, the most current issue
    that we have.
        Mr. Natsuhara, last year Congress provided $300 million for
    the Guam relocation project, and this year's request is $452
    million. Are the fiscal year 2010 projects currently on hold?
        Mr. Natsuhara. We are currently waiting until the EIS is
    completed. We are not able to move forward until the record of
    decision is signed and that is scheduled for the end of this
    fiscal year, and then we plan on executing our fiscal year--the
    previous money, the fiscal year 2010 money.
        Senator Hutchison. Okay. Let me talk to you, General Payne,
    about the status of the site for the preferred training range
    and what is the status of that. And just in general--I think it
    is clear from the earlier panel as well--is there any kind of
    alternative being looked at by the marines, either the full
    8,000 movement of marines, or is there anything that is being
    looked at in any kind of a lesser footprint in Guam?
        And if you do not get the preferred training range, would
    that also require you to look at other alternatives? And what
    are your plans or contingency plans, I guess I should say?
        General Payne. Yes, ma'am. As Mr. Mitchell said, a lot of
    alternatives were looked at before. But we are where we are
    now. I think your question is very pertinent in that based on
    what we know now, what are we doing, if I interpret your
    question correctly.
        Over the last year, we did take a very hard look at Korea
    and the viability of positioning marine forces there, and we
    looked at putting a small marine air/ground task force [MAGTF]
    there and the pros and cons of that. And we came away with the
    conclusion that Guam is far and away our preferred alternative.
        That said, should for some reason we run into
    insurmountable issues on Guam, we must then reexamine the size
    of the marine force. We have begun discussing it, but quite
    frankly, we are not very far along in that analysis because we,
    at this juncture, are still confident that we can work through
    some of these issues on Guam and get to the preferred lay-down,
    which would be a little over 8,000 marines and a robust MAGTF
    capability.
        Senator Hutchison. Could you give me a couple of the major
    points that you determined Korea would not be as helpful to the
    marines or as desirable as that full footprint on Guam?
        General Payne. I can give you what from my position it
    appeared to be the case. However, I must qualify it to the
    extent that I was not heavily involved in that analysis because
    my main emphasis is the installation side and the environmental
    side as opposed to the operational. And there were concerns
    with both.
        The cost of the lay-down of marine forces was certainly
    substantial on Korea, as it will certainly be anywhere in the
    Pacific. So there was not a----
        Senator Hutchison. More so than Guam where we already are
    going to have the investment in the forward basing in the south
    of Korea?
        General Payne. We would not have as extensive, certainly,
    infrastructure issues on Korea as we are dealing with with
    Guam, and that is absolutely true. The actual bases themselves
    and the ranges would be pretty comparable. However, we felt
    that from just a pure strategic, forward positioning
    standpoint, Guam was certainly preferable. It provided more
    flexibility in a better location. There was some concern with
    Korea as to training availability in competition with the Army.
    There was some concern with how flexible it would be to move
    forces off of Korea for other exercises and support and
    contingency in the Pacific.
        But the Marine Corps does need to continue to explore other
    alternatives, just in case our preferred alternative, which is
    Guam, runs into problems.
        I think your second question was with respect to training
    ranges. On Guam, our plan is to have small-unit and individual
    skills training, essentially pistol, rifle, machine gun type
    training. The crew served weapons training and indirect fire
    ranges at this point we hope to position on Tinian and possibly
    Pagan Islands in the Northern Marianas. We have not had an
    opportunity to do the extensive environmental study of Tinian,
    both with respect to the ranges and the air space availability,
    but that would be the next step.
        Should we run into obstacles with respect to training, that
    too would be just a gigantic constraint relative to positioning
    marines on Guam or in the Northern Marianas. Absolutely.
        Senator Hutchison. Okay. Those were the major questions
    that I had. I really thank all of you for coming. Is there
    anything that you would wish to add?

                         ADDITIONAL COMMITTEE QUESTIONS

        If not, the questions that I asked for the record of the
    previous panel would be due March 30 to the subcommittee
    chairman.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                   Questions Submitted to Roger M. Natsuhara
                   Questions Submitted by Senator Tim Johnson

                                     ENERGY

        Question. As you noted in your written testimony, Secretary Mabus
    has set a goal of having 50 percent of the Navy's shore-based energy
    come from renewables by 2020.
        What percentage of shore-based energy currently comes from
    renewables?
        Answer. Under the 2010 National Defense Authorization Act
    definition, renewable energy as a percentage of total energy, the Navy
    renewable energy source contributions totaled to 11 percent of our
    total reportable shore energy consumption.
        Question. Do you have a plan in place and an investment strategy in
    the FYDP to achieve the 50 percent goal by 2020?
        Answer. The Navy submitted the President's fiscal year 2011 budget
    (PB11) to the Office of the Secretary of Defense prior to the Secretary
    of the Navy (SECNAV) announcement of his Energy Goals for 2020 in
    October 2009; as such, the SECNAV Energy Goals were not considered in
    the PB11 program.
        Question. A disruption of the commercial power grid poses a serious
    threat to critical military base operations. What is the Navy doing in
    terms of infrastructure to address this security threat?
        Answer. The threat of commercial power supply disruption is
    considered within Secretary Mabus' 2020 energy goals. The Navy has a
    three-tiered approach to Energy Security for the future:
      --Improve energy grid resiliency and ability to control demand-side
            load control inside our fence lines.
      --Improve the backup and redundant energy systems to ensure reliable
            energy to our critical infrastructure even in the event of an
            extended grid failure.
      --Work with utility providers to ensure the Navy is in the best
            possible position for reliable energy in the near-term, and
            positioned to integrate fully with a National ``Smart Grid'' in
            the long-term.

                                      GUAM

        Question. Last year Congress provided $300 million for the Guam
    relocation project, and the request this year is for $452 million.
        Are the fiscal year 2010 projects currently on hold?
        Answer. No, the fiscal year 2010 projects are not on hold. Designs
    are progressing or complete, with the construction acquisition phase
    scheduled to start over the next 3 months. These projects will be
    awarded after the Record of Decision (ROD) on the proposed action is
    signed.
        Question. What is the earliest that the fiscal year 2010 funds
    could be obligated?
        Answer. Construction awards are currently projected for the post-
    ROD timeframe (September 2010), the earliest that fiscal year 2010
    funds could be obligated.
        Question. If the projects can go forward then, could the Navy
    execute them by the end of the fiscal year?
        Answer. Our acquisition plan has us awarding all fiscal year 2010
    projects within fiscal year 2010 contingent upon the signing of the ROD
    as stated above.
        Question. On that schedule, could the Navy execute the full $752
    million by the end of fiscal year 2011?
        Answer. Three of the fiscal year 2011 projects are the second
    increment of fiscal year 2010 projects and the funds will be obligated
    soon after receipt. The remainder is proceeding in the design phase
    with awards scheduled for no later than third quarter fiscal year 2011.
        Question. Commercial port improvements are crucial to the Navy's
    construction program on Guam, but an anticipated DOT stimulus grant to
    do the work recently fell through. How does the Navy plan to address
    this problem?
        Answer. The Administration has requested Congress to grant the
    Department of Defense authority to transfer up to $50,000,000 of
    expiring fiscal year 2010 funds to the Department of Transportation's
    Port of Guam Improvement Enterprise Fund, established in the fiscal
    year 2009 National Defense Authorization Act (Public Law 110-417,
    section 3512). This funding, in conjunction with a matching loan from
    USDA, would enable the Maritime Administration (MARAD) to make
    improvements to the port.
                                     ______

                    Questions Submitted by Senator Jack Reed

        Question. Rhode Island faces the Nation's third highest
    unemployment rate at 12.7 percent and a recession that hit earlier than
    any other State. Indeed, many highly skilled workers in the
    construction industry cannot find work.
        I continue to support efforts to revitalize Navy infrastructure,
    including projects at Naval Station Newport. Rhode Island contractors
    have expressed frustrations in terms of their ability to effectively
    compete for this work. Information provided at my request by the Navy
    has demonstrated that a large number of Navy construction projects in
    Rhode Island are going to out-of-State firms.
        To your knowledge, are other States experiencing this situation?
        Answer. We have had, and answered, concerns from Connecticut,
    Illinois and Arizona.
        Question. What steps are you taking to ensure that there is ample
    competition for these projects that includes in-State firms?
        Answer. To ensure ample competition for projects, the Naval
    Facilities Engineering Command (NAVFAC) publicizes contract
    solicitations in accordance with Federal Acquisition Regulations (FAR).
    We also set aside as much work as possible for small business, based on
    the acquisition strategy prepared in accordance with the Competition in
    Contracting Act of 1984 and the Federal Acquisition Regulations. While
    these small business set-asides lend themselves to attracting local
    firms, law and regulations do not allow the Navy to restrict
    competition by State residency of firms.
        Question. How do you ensure that there is sufficient notification
    of open solicitations?
        Answer. We ensure sufficient notification by following FAR Part 5--
    Publicizing Contract Actions, which requires the Contracting Officer to
    publicize proposed contract actions expected to exceed $25,000 at a
    Government-wide point of entry (GPE). The notices are published at
    least 15 days before issuance of a solicitation. The GPE utilized by
    the Navy includes Navy Electronic Commerce Online (NECO) which has a
    direct link to Federal Business Opportunities (FEDBIZOPPS). Information
    for additional opportunities can also be found on the NAVFAC Small
    Business Web site, https://smallbusiness.navfac.navy.mil.
        Question. What initiatives are available to help in-State firms
    learn about and better compete for contracts? What support or technical
    assistance can you offer to firms in my State?
        Answer. NAVFAC holds various conferences throughout the United
    States which provide assistance and information to all types of firms
    about contracting opportunities and the necessary resources to compete
    for NAVFAC contracts. Many of these conferences are targeted to small
    business firms and NAVFAC will initiate a similar type of conference
    for the Rhode Island area.
        Question. President Obama issued Executive Order 13502 encouraging
    executive agencies to consider the use of Project Labor Agreements
    (PLAs) in connection with large-scale construction projects.
        I support this effort because it promotes the efficient
    administration and completion of Federal construction projects. It
    would also make sure workers are being treated fairly in terms of wages
    and benefits during these difficult economic times.
        What efforts have you taken to implement this Executive Order?
        Answer. Naval Facilities Engineering Command (NAVFAC) is prepared
    to implement the Executive Order as appropriate, pending the regulatory
    publication of Department of Defense or Department of Navy supplemental
    guidance now that Federal Acquisition Regulation (FAR) implementing
    rules were published on April 13, 2010.
        At the request of the Office of the Secretary of Defense and Deputy
    Assistant Secretary of the Navy (Acquisition & Logistics Management),
    NAVFAC provided panel members for the Office of Management and Budget
    (OMB) PLA Steering Committee, which has been working to assist in the
    FAR process. These subject matter experts identified challenges and
    suggested solutions for inclusion in the FAR rule that now provides
    guidance mechanisms for implementing project labor agreements in the
    Federal sector.
        Additionally, the NAVFAC Labor Advisor has initiated meetings with
    the AFL-CIO, Building and Construction Trades Department, to discuss
    possible mechanisms for establishing PLA requirements as a part of the
    acquisition process and to explore the feasibility of a PLA on specific
    projects.
        Question. Secretary Mabus has set important goals for the Navy to
    improve energy efficiency and to increase the use of renewable energy
    sources.
        You are, I think, promoting the use of renewable energy resources
    largely to help the Navy to control its own energy supply and operate
    independently and securely. Still, there is the potential to share
    surplus resources with the civilian grid.
        How are you managing the interconnection between Navy installations
    and the civilian grid generally? Are you looking at how surplus
    ``green'' power can be shared, even sold, on the civilian side?
        How are you coordinating with the States and other Federal agencies
    (including the President's Ocean Policy Task Force, NOAA, the Minerals
    Management Service, and others) to appropriately site offshore
    renewable energy projects?
        Answer. When the Navy develops large renewable projects we
    typically require the contractor to own and operate the project. In
    those cases where the size of the project exceeds the requirements of
    the installation, we authorize the contractor to sell power to the
    grid. The contractor is responsible for interaction with the utility
    companies and compliance with all transmission access requirements.
        Navy has not entered into any offshore projects to date. We are
    actively participating in a number of interagency forums with the
    Department of Energy, the National Oceanic and Atmospheric
    Administration, the Federal Energy Regulatory Commission, and the U.S.
    Coast Guard, particularly with respect permitting and site issues.
                                     ______

              Questions Submitted to Major General Eugene G. Payne
                   Questions Submitted by Senator Tim Johnson

        Question. What is the status of acquiring the site for the
    preferred training range on Guam?
      --Do you believe that Tinian would be a suitable alternative?
      --How would it impact training if the Marines cannot use the proposed
            range on Guam?
      --Are there any alternative training ranges on Guam?
      --If the Marine Corps cannot obtain the preferred training site on
            Guam, is the Guam relocation still a viable option for the
            Marines?
        Answer. No Department of Defense decision has been made regarding
    the alternatives presented in the Draft Environmental Impact Statement
    (EIS). It is important that the EIS process be allowed to continue
    without any pre-determination on any particular alternative. It is
    important to note that the realignment of U.S. forces to Guam is
    intended to provide a long term posture that benefits both U.S.
    security interests as well as the people of Guam. Our land acquisition
    will use the minimum amount of land needed to support readiness and
    quality of life, ensure that we are good neighbors, minimize the need
    for marines and dependents to drive on roads and impact the local
    communities, and ensure good stewardship of any cultural or historical
    sites. Without the acquisition of additional land, the challenges with
    future growth and encroachment will become more difficult to fix over
    time and would have a greater impact to the local communities.
      --Tinian is currently planned to support larger-force training events
            involving up to 400 marines. The training planned for Guam is
            the type of training that marines will conduct on a daily/near-
            continuous basis. The types of ranges being planned for on Guam
            support basic, individual skills--those essential warfighting
            skills that make us marines--that all marines are required to
            use on an annual basis, at a minimum, for readiness
            sustainment. Based on the frequency of range use, the number of
            marines relying on these ranges for annual qualifications and
            the enduring presence the Marine Corps intends to have on Guam,
            we have determined that it is more cost effective to build
            certain ranges at the location where marines live and work.
            These ranges would be used on a near continuous basis, and the
            115-mile transit to Tinian would be beyond the Marine Corps
            local tactical lift capability. Additionally, the ranges
            currently planned on Tinian (under the current draft EIS) do
            not support medium or heavy caliber rounds as required for the
            multi-purpose machine gun range nor does it provide for the
            required special use airspace. Finally, building the required
            ranges on Tinian would require significant construction,
            infrastructure, and permanent basing of support personnel.
      --The Marine Corps is interested in the Route 15 lands to best
            maximize training efficiencies, limit the amount of road travel
            by military vehicles, and provide sufficient range design
            flexibility while ensuring long-term utilization of the land.
            Numerous directives dictate USMC range design and construction
            (size, distance, orientation, safety buffers). Further,
            training and readiness requirements stipulate which training
            must be conducted prior to conducting subsequent training. To
            comply with the requirements it is prudent to travel to a
            consolidated area which allows centralized movement from one
            range to another thereby reducing the need to travel large
            distances over the roads. As a result, marines are able to
            train more efficiently which results in less needed range time
            and therefore less of an impact on the communities surrounding
            the ranges. A solution other than a consolidated training area
            would be counter to these efforts.
      --The Draft EIS considered multiple alternative training ranges;
            however, they were dismissed for various reasons. The Marine
            Corps requires greater training capabilities than are currently
            available on Guam, particularly in terms of live-fire ranges.
            As studied in the Draft Environmental Impact Statement, the
            needs for different types of live-fire ranges are best
            configured in a consolidated range complex.
        --Finegayan was dismissed by the Government of Guam as a potential
                live-fire training location because the Surface Danger
                Zones would extend into the western coastal waters, making
                them unusable to water traffic and impacting tourism near
                Tumon.
        --Tarague beach was dismissed as a potential live-fire training
                location because the lack of available acreage to fully
                accommodate the required Surface Danger Zones.
        --Ritidian was dismissed as a potential live-fire training location
                because there is simply not enough acreage at Ritidian to
                safely build the types of firing ranges required for Marine
                Corps training. Furthermore, the Fish and Wildlife Service
                Property at Ritidian is part of a larger environmental
                preserve that extends south to NCTS Finegayan.
        --We cannot construct live-fire ranges in the Naval Munitions Area
                for three reasons. First, the rolling terrain is too severe
                to grade for a live fire range. Second, the explosive
                safety arcs are active daily due to ammunition operations
                and the arcs overlap almost the entire munitions area.
                Third, round impacts could create lead and phosphorous
                contamination of the Fena Reservoir due to rain run-offs
                and potentially harm the reservoir which supplies fresh
                water to the lower half of Guam.
      --A Marine Corps title 10 requirement is to ensure that its marines
            are properly trained. The land use for live-fire training
            identified in the Draft Environmental Impact Statement was the
            best solution to meet Marine Corps training requirements and
            throughput needs. Several land use options were identified but
            quickly dismissed because of safety, noise, or environmental
            concerns. Live-fire training ranges on Guam are required to
            sustain individual skills readiness for marines stationed
            there. The best long-term land use for live-fire training
            ranges involves the acquisition of public lands along Route 15
            to ensure safety and minimal impact to the local community and
            environment. Given the rationale for dismissing the alternative
            training areas, without the acquisition of public lands along
            Route 15, the Marine Corps would not have the ability to
            maintain readiness of those forces on Guam and create risk in
            meeting Combatant Commander requirements with forward postured
            forces.
        Question. It appears that several different sites are now being
    considered for the Futenma relocation on Okinawa. Has the Marine Corps
    considered other sites on Okinawa, and do you believe there are viable
    alternatives to the current plan?
        Answer. The current Futenma Replacement Facility (FRF) plan is a
    result of several years of bilateral planning culminating in what was
    agreed to be the best answer for both parties. The GoJ has not made any
    formal proposals for alternate options, nor have they formally
    identified what is wrong with the current Agreed Implementation Plan
    (AIP). We continue to honor the AIPs and will respect the GoJ's
    processes of policy review. However, it is the USMC position that any
    FRF option the GoJ may present must provide the same or better
    capability of the current FRF plan.
        Question. Is the Marine move to Guam contingent on the Futenma
    relocation?
        Answer. As negotiated in the 2006 AIPs and reiterated in the
    February 2009 International Agreement, the relocation of marines from
    Okinawa to Guam is dependent on ``tangible progress'' toward completion
    of the FRF. The Marine Corps and Department of Defense position is that
    any Marine realignment must retain an aviation capability on Okinawa to
    support III MEF. That is why there is specific language to ensure a
    suitable replacement for Marine Corps Air Station Futenma, which will
    enable the relocation to Guam, and ultimately enable the return of
    bases back to the Government of Japan.
                                     ______

            Question Submitted to Rear Admiral Christopher J. Mossey
                   Question Submitted by Senator Tim Johnson

        Question. The fiscal year 2011 budget request includes three major
    Milcon energy projects for the Marine Corps.
        Outside of ECIP, are there additional major Milcon energy projects
    programmed for the Navy and Marine Corps in the FYDP? If so, please
    identify those projects and the years in which they are programmed.
        Answer. The PB11 Milcon program contains the following Energy
    Security and Energy Efficiency improvement Milcon projects:
      --P-603, Shore Power to Ammo Pier, NAVMAG Indian Island, WA (fiscal
            year 2015);
      --P-400, Replace North LP Electrical Distribution System,
            PACMISRANFAC Hawaiian Area (fiscal year 2015);
      --P-393, Replace Wastewater Treatment Plant, NAS Fallon, NV (fiscal
            year 2015); and
      --P-844, Upgrade Shore power for CAX Pier, CAD-A, NAVWEPSTA Yorktown,
            VA (fiscal year 2015).

                              SUBCOMMITTEE RECESS

        Senator Hutchison. So with that, we are recessed and I
    thank you very much.
        [Whereupon, at 11:19 a.m., Tuesday, March 23, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

       MILITARY CONSTRUCTION AND VETERANS AFFAIRS, AND RELATED AGENCIES
                      APPROPRIATIONS FOR FISCAL YEAR 2011

                                  ----------

                            THURSDAY, APRIL 15, 2010

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 2:04 p.m., in room SD-124, Dirksen
    Senate Office Building, Hon. Tim Johnson (chairman) presiding.
        Present: Senators Johnson, Murray, Nelson, Pryor,
    Hutchison, Brownback, Collins, and Murkowski.

                         DEPARTMENT OF VETERANS AFFAIRS

    STATEMENT OF HON. ERIC K. SHINSEKI, SECRETARY
    ACCOMPANIED BY:
            HON. ROBERT A. PETZEL, M.D., UNDER SECRETARY FOR HEALTH,
                VETERANS HEALTH ADMINISTRATION
            MICHAEL WALCOFF, ACTING UNDER SECRETARY FOR BENEFITS, VETERANS
                BENEFITS ADMINISTRATION
            STEVE L. MURO, ACTING UNDER SECRETARY FOR MEMORIAL AFFAIRS,
                NATIONAL CEMETERY ADMINISTRATION
            W. TODD GRAMS, ACTING ASSISTANT SECRETARY FOR MANAGEMENT AND
                CHIEF FINANCIAL OFFICER
            HON. ROGER W. BAKER, ASSISTANT SECRETARY FOR INFORMATION AND
                TECHNOLOGY, OFFICE OF INFORMATION AND TECHNOLOGY

                    OPENING STATEMENT OF SENATOR TIM JOHNSON

        Senator Johnson. This hearing will come to order.
        We meet today to review the fiscal year 2011 budget request
    and the fiscal year 2012 advance appropriations request for the
    Department of Veterans Affairs.
        Secretary Shinseki, I welcome you and your colleagues and I
    thank you for appearing before our subcommittee.
        I will remind my colleagues that in order to reserve time
    for questions, our procedure is to have opening statements by
    the chairman and ranking member, followed by an opening
    statement from the Secretary. We will limit the first round of
    questions to 6 minutes per member, but we can have additional
    rounds should we need them.
        The fiscal year 2011 discretionary budget request for the
    VA totals $56.9 billion, an increase of 7.4 percent over the
    fiscal year 2010 enacted level. Additionally, the request
    includes $50.6 billion in fiscal year 2012 advance
    appropriations for medical care.
        The budget submission also includes a separate supplemental
    request of $13.4 billion to expand Agent Orange benefits.
        I am especially pleased to see that the request includes an
    increase of $460 million over fiscal year 2010 for the Veterans
    Benefits Administration (VBA) to hire additional claims
    processors. Delays in claims processing are probably the most
    common complaint I hear from South Dakota vets.
        Mr. Secretary, I have read your testimony and I am happy to
    see that reducing the current claims backlog is your highest
    priority. It is my highest priority as well, and I will
    continue to work to provide the sufficient resources to the
    Department to increase the number of claims processors and to
    streamline and expedite the process.
        Before I turn to my ranking member, I want to commend you,
    Mr. Secretary, for your passion and commitment to ending
    homelessness among the vets population.
        I am also pleased to see a continued commitment in the
    budget to improve mental healthcare among vets and to
    strengthen and expand rural healthcare.
        Mr. Secretary, I look forward to hearing your opening
    statement, but before you begin, Senator Hutchison, would you
    care to make an opening statement?

                   STATEMENT OF SENATOR KAY BAILEY HUTCHISON

        Senator Hutchison. Thank you, Mr. Chairman. I will be
    brief. Let me just make a couple of points. I think the
    chairman has stated the facts.
        I want to say that I commend the Department for the
    decision on the Agent Orange diseases, and I think that is the
    right thing to do. I also commend you for putting into the
    rulemaking process gulf war syndrome and the diseases that have
    come from that that have heretofore not been acknowledged, and
    I think that is a step in the right direction.
        However, I will say that I also agree with the chairman
    that it means that you are going to have more claims and claims
    processing has been an issue, and I know you know that. But
    certainly the Agent Orange ones will come first and 150,000 are
    expected. That is information that I know you have and I know
    that you will make that a high priority. But it is the right
    decision for our veterans, and I commend you for it.
        The only other thing that I will mention in the big
    picture--and I will have a question or two--is also the
    emphasis on mental health services. As we have all discussed,
    post traumatic stress disorder, substance abuse problems,
    suicides, and illnesses that have increased in our active duty
    population, which also moves into our veterans population and
    retirees--I think that the increase in the budget proposed,
    $5.2 billion for mental health treatment, is an increase from
    last year that is very warranted. I think that we have begun in
    the last few years to acknowledge more the mental health issues
    and I think the treatment that is to follow coming from that is
    the right thing.
        With that, Mr. Chairman, I will submit the rest of my
    statement for the record and look forward to asking a few
    questions.
        [The statement follows:]

               Prepared Statement of Senator Kay Bailey Hutchison

        Thank you, Mr. Chairman. I am pleased to welcome Secretary Shinseki
    and our other witnesses and guests to discuss the President's 2011
    budget request.
        Mr. Chairman, the Department of Veterans Affairs has one of the
    most important missions in our government, and this subcommittee has
    always worked hard to provide the Department with the resources it
    needs to give our veterans the very best care this Nation can provide.
    In my home State of Texas, I am proud to say the VA operates 11 major
    medical centers, more than 40 outpatient clinics, 14 vet centers, and 6
    national cemeteries to care for our State's 1.7 million veterans.
        Today we will examine the budget request that provides for our
    veterans nationwide, including their benefits and healthcare. The VA's
    2011 budget request proposes an $11.4 billion increase above last
    year's level--a robust 10 percent increase for our veterans. In
    addition to the $121 billion requested in 2011, the Department has
    recommended $13.4 billion in the 2010 supplemental appropriations bill
    for new Agent Orange-related presumptions, and $50.6 billion in advance
    appropriations to fund veterans' healthcare in 2012. That is a total of
    $185 billion in VA spending before us today--a tremendous amount of
    funds--and I want us all to work together to ensure this money is spent
    is the most fiscally efficient way possible.
        In addition to its 2011 request, the Department is requesting $13.4
    billion in the 2010 supplemental appropriations bill to fund the VA's
    recent decision to add ischemic heart disease, Parkinson's disease, and
    B cell leukemia to its list of automatic service-connected disabilities
    for Vietnam veterans exposed to Agent Orange. This presents a
    considerable challenge to the VA's claims processing system, which
    already has an unacceptably large disability claims backlog. The
    Department anticipates the total number of disability claims it
    receives to increase by 30 percent in 2010, with approximately 150,000
    of these claims Agent Orange-related. I am pleased to see that this
    budget adds another 2,100 claims processors to the VA's current staff
    level, because I am concerned that our veterans already wait too long
    for their disability claims to be processed. Mr. Secretary, you have a
    significant challenge in front of you on how to handle a 30 percent
    increase in your claims workload, in addition to such a large influx
    into your workforce that will require specialized training, without
    causing a major disruption to other veterans' disability claims. I look
    forward to your comments on how we can assist you in this matter.
        Mr. Secretary, the Army and the VA currently share a joint facility
    in El Paso, Texas. The Army has requested a significant amount of money
    in its 2011 budget request to begin design of a new facility in June of
    this year. As I understand it, the VA will need to commit funds towards
    a joint design by June, or the Army will award a contract based only on
    its own requirements. I look forward to discussing your plans on how to
    match the Army's accelerated timetable for this facility during the
    question and answer portion of our hearing today.
        In its 2011 budget request, the VA recommends $1.15 billion for
    major construction projects, slightly below last year's level of $1.2
    billion. A significant portion of this funding shows an effort to
    accelerate the schedules for two of the VA's longest-running projects--
    hospitals in New Orleans and Denver that have been partially funded for
    several years.
        However, I am concerned that we are not obligating construction
    funds as quickly and efficiently as we could, and that the VA does not
    have a prioritized long-range capital plan to present to Congress. As
    you know, Mr. Secretary, for military construction projects we
    appropriate funds that have to be spent within 5 years to ensure
    efficient planning and execution. And, we also receive a Future-Year
    Defense Program (FYDP) from each service to understand and budget for
    long-range capital needs. As a former Army Chief of Staff, I am
    interested to hear your thoughts on whether you think having the VA
    construction program abide by some of these parameters, such as 5-year
    funding and a prioritized Five-Year Capital Plan, would be beneficial
    to the process.
        Mr. Secretary, nearly all the efforts to modernize the VA hinge
    upon the Department's ability to leverage information technology to
    improve services to our veterans. Some of the projects we've funded in
    past budgets include a paperless solution to the disability claims
    backlog, a new electronic medical record, and a lifetime service record
    to follow service members through the Departments of Defense and
    Veterans Affairs. However, government agencies have a poor track record
    developing and implementing costly IT programs, and an internal audit
    by the VA last year resulted in 45 of the Department's 282 ongoing
    projects being halted because they were either significantly behind
    schedule or over budget. I want to be sure we are spending our taxpayer
    dollars efficiently, and I look forward to hearing your thoughts on
    what steps we can take to ensure more efficiency and transparency for
    these projects.
        I am pleased to see the emphasis that the Medical Services request
    places on mental health and rehabilitation, especially for our soldiers
    returning with delayed Post-Traumatic Stress Disorder and substance
    abuse problems. The VA's budget proposes $5.2 billion for mental health
    treatment, a $410 million increase above last year. The VA now has PTSD
    specialists or treatment teams in all of its medical centers.
        As our men and women return from war, we want to be certain they
    receive the very best medical care our Nation can provide. Your budget
    request keeps us on that track. I know it is difficult to anticipate
    every need, but this subcommittee will certainly make every effort to
    provide you the resources you need.
        Mr. Secretary, I am extremely pleased with the VA's decision to
    build its fifth polytrauma center in San Antonio. I can't wait to see
    this project complete and operational, and I'm thrilled that contracts
    have been awarded and construction has begun. This new center will care
    for our most severely injured veterans and will be a great complement
    to the other medical facilities in the San Antonio area, where cutting-
    edge technology will be shared between the VA and the military
    services.
        The VA manages the only nationwide network to care for polytrauma
    patients and has become the world's leader in traumatic brain injury
    rehabilitation. As more of our soldiers return home with multiple
    traumatic injuries, I am confident we can leverage the VA's experiences
    at the other four Level 1 polytrauma centers to make this new facility
    the VA's flagship for our Nation's most seriously wounded veterans.
        Mr. Secretary, this subcommittee has always put our Nation's
    veterans first, and I can say with great assurance that we will do
    whatever it takes, in a bipartisan manner, to work with you to make
    sure the VA has all of the necessary resources to take care of our
    Nation's veterans. At the same time, it is our joint responsibility to
    ensure these funds are spent in the most fiscally responsible and
    efficient manner possible. I look forward to working with you on these
    and other issues in the coming months.
        Thank you, Mr. Chairman.

        Senator Johnson. Thank you, Senator Hutchison.
        Mr. Secretary, again I welcome you to the subcommittee. I
    understand that yours will be the only opening statement. Your
    full statement will be included in the record. So please feel
    free to summarize your remarks. Mr. Secretary.
        Secretary Shinseki. Thank you very much, Chairman Johnson.
    To you and Ranking Member Hutchison, other distinguished
    members of this subcommittee, thanks. I always say that
    sincerely. Thank you for this opportunity to present the
    President's 2011 budget and the 2012 advance appropriations
    request for VA.
        I am able to report a good start in 2009, and I would just
    take a moment to remind that the 2009 budget was a
    congressionally enhanced budget. So there was a great
    foundation for this Secretary upon arrival to put in place a
    good foundation for the year that we are now having with the
    2010 budget. VA had a good start in 2009 with a tremendous
    opportunity this year in 2010. We are happy to talk about what
    we are doing, and the President's continued strong support for
    veterans and veterans needs into the 2011 budget request, which
    is before Congress, with the 2012 advance appropriations.
        I appreciate the generosity of time shared by members of
    this subcommittee with me as I made my rounds. I regret that I
    was not able to call on everyone, but I thank the members that
    I was able to meet. Those opportunities are always invaluable
    to me in getting insights.
        I would like to acknowledge in our audience today
    representatives from some of our veterans service
    organizations. Their insights have been helpful to me in
    understanding our obligation and how to frame our actions to
    better meet the needs of veterans.
        By way of introduction, Mr. Chairman, let me introduce the
    members of my team from my left here. Mike Walcoff is the
    Acting Under Secretary for Benefits. Todd Grams is our new
    Principal Deputy and Acting Assistant Secretary for Management.
    Dr. Randy Petzel to my right, recently confirmed Under
    Secretary for Health. Steve Muro, Acting Under Secretary for
    Memorial Affairs. And on my extreme right, Roger Baker, our
    Assistant Secretary for Information and Technology, who also
    serves as our Chief Information Officer.
        This subcommittee's longstanding commitment to our Nation's
    veterans has always been unequivocal and unwavering, and such
    commitment and the President's own steadfast support of
    veterans resulted in a 2010 budget that provides this
    Department the resources to begin renewing itself in
    fundamental and comprehensive ways, not in spots but as an
    entire organization, fundamental and comprehensive ways.
        We are well launched on that effort and determined to
    continue that transformation into 2011 with this budget and
    2012.
        For over a year now, we have promoted a new strategic
    framework organized around three governing principles, and I
    have mentioned them before in prior testimonies, and I will
    just repeat them again. It is about transforming VA into being
    more people-centric, results-oriented or results-driven, and
    forward-looking. And in our effort, our strategic goals are
    several: improve the quality of, and increase access to, care
    and benefits while optimizing value; heighten readiness to
    protect our people, clients as well as our workforce, and our
    resources each day, as well in times of crisis; enhance veteran
    satisfaction with our health, education, training, counseling,
    financial, and burial benefits and services; and finally,
    invest in our human capital both in their well-being, our
    workforce, and in their development as leaders so that over
    time we have this irreversible drive toward excellence in
    everything we do, from management, to IT systems, to support
    services.
        This last goal is vital to mission performance if we are to
    attain being a model of governance in the next 4 years, which
    is our goal. These goals will guide our people daily and focus
    them on producing the outcomes veterans expect and have earned
    through their service to the Nation. We will advocate for
    veterans we serve.
        To support our pursuit of these goals, the President's
    budget provides $125 billion in 2011, $60.3 billion in
    discretionary resources and $64.7 billion in mandatory funding.
    Our discretionary budget request represents an increase of $4.2
    billion over the President's 2010 enacted budget.
        VA's 2011 budget focuses primarily on three critical
    concerns that are of significant importance to veterans, and I
    get this in feedback as I travel and I am sure members of the
    subcommittee do as well. First, increase access to benefits and
    services now. Eliminate the disability claims backlog by 2015.
    And finally, end veteran homelessness in the next 5 years. The
    three goals we have set for ourselves.
        Access. This budget provides the resources required to
    increase access to our healthcare system and our national
    cemeteries. We will expand access to healthcare by activating
    new and improved facilities, by honoring the President's
    commitment to veterans who were exposed to Agent Orange 40
    years ago, by delivering on President Obama's promise to
    provide healthcare eligibility to more priority group 8
    veterans, by making greater investments in telehealth and
    extending our delivery of care into the most remote rural
    communities and, where warranted, even into veterans' homes.
    And finally, we will increase access to our national shrines by
    establishing five new national cemeteries.
        The backlog. We are requesting an unprecedented 27 percent
    increase in funding for our Veterans Benefits Administration,
    primarily for staffing to address the growing increase in
    disability claims receipts, even as we continue to reengineer
    our processes and develop a paperless system integrated with
    VLER, the Virtual Lifetime Electronic Record. That is the joint
    project between DOD and VA.
        Our goal in processing: no claim that is longer than 125
    days. So it is not an average. No claim longer than 125 days,
    and a processing accuracy of 98 percent. Today we are at the 84
    percent mark. So this is a stretch goal.
        Ending homelessness. We are requesting substantial
    investment in our homelessness program as part of our plan to
    eliminate homelessness in 5 years. Ending the downward spiral
    that often enough leads to veterans' homelessness mandates that
    we aggressively and simultaneously address housing, education,
    jobs, and healthcare.
        In this effort, we partner with other Departments. The
    Department of Housing and Urban Development is probably our
    closest collaborator, but we collaborate as well with Labor,
    Education, Health and Human Services, Small Business
    Administration, among others.
        Now, taken together, these initiatives are intended to meet
    veterans' expectations in each of these three mission-focused
    areas. I mentioned them earlier. Increasing their access,
    eliminating the backlog, ending homelessness. We will achieve
    these objectives by developing innovative business processes,
    some of them already underway, and delivery systems that not
    only better serve veterans and families' needs for many years
    to come, but which also dramatically improve our efficiency and
    control our costs.
        While our budget and advance appropriations request provide
    the resources to continue our pursuit of the President's two
    overarching goals for this Department--transform this
    Department and ensure veteran access--we still have much work
    to accomplish.
        We appreciate the chairman's and ranking member's
    leadership and the support of all the members of the
    subcommittee especially in some of the areas that we have given
    attention to, areas like rural health and healthcare for women
    veterans. We are determined to build on the progress you have
    enabled, especially with the provision of a significant first-
    year funding for rural initiatives. So our efforts are well
    begun, but there is more work to be done in meeting our
    obligations here.

                               PREPARED STATEMENT

        Again, Mr. Chairman, members of the subcommittee, thanks
    for this opportunity to appear here today. I look forward to
    your questions.
        [The statement follows:]

                  Prepared Statement of Hon. Eric K. Shinseki

        Chairman Johnson, Ranking Member Hutchison, Distinguished Members
    of the Senate Appropriations Committee, Subcommittee on Military
    Construction, Veterans Affairs, and Related Agencies:
        Thank you for this opportunity to present the President's Fiscal
    Year 2011 Budget and Fiscal Year 2012 Advance Appropriations request
    for the Department of Veterans Affairs (VA). Our budget provides the
    resources necessary to continue our aggressive pursuit of the
    President's two overarching goals for the Department--to transform VA
    into a 21st century organization and to ensure that we provide timely
    access to benefits and high quality care to our Veterans over their
    lifetimes, from the day they first take their oaths of allegiance until
    the day they are laid to rest.
        We recently completed development of a new strategic framework that
    is people-centric, results-driven, and forward-looking. The path we
    will follow to achieve the President's vision for VA will be presented
    in our new strategic plan, which is currently in the final stages of
    review. The strategic goals we have established in our plan are
    designed to produce better outcomes for all generations of Veterans:
      --Improve the quality and accessibility of healthcare, benefits, and
            memorial services while optimizing value;
      --Increase Veteran client satisfaction with health, education,
            training, counseling, financial, and burial benefits and
            services;
      --Protect people and assets continuously and in time of crisis; and,
      --Improve internal customer satisfaction with management systems and
            support services to achieve mission performance and make VA an
            employer of choice by investing in human capital.
        The strategies in our plan will guide our workforce to ensure we
    remain focused on producing the outcomes Veterans expect and have
    earned through their service to our country.
        To support VA's efforts, the President's budget provides $125
    billion in 2011--almost $60.3 billion in discretionary resources and
    nearly $64.7 billion in mandatory funding. Our discretionary budget
    request represents an increase of $4.3 billion, or 7.6 percent, over
    the 2010 enacted level.
        VA's 2011 budget also focuses on three concerns that are of
    critical importance to our Veterans--easier access to benefits and
    services; reducing the disability claims backlog and the time Veterans
    wait before receiving earned benefits; and ending the downward spiral
    that results in Veterans' homelessness.
        This budget provides the resources required to enhance access in
    our healthcare system and our national cemeteries. We will expand
    access to healthcare through the activations of new or improved
    facilities, by expanding healthcare eligibility to more Veterans, and
    by making greater investments in telehealth. Access to our national
    cemeteries will be increased through the implementation of new policy
    for the establishment of additional facilities.
        We are requesting an unprecedented increase for staffing in the
    Veterans Benefits Administration (VBA) to address the dramatic increase
    in disability claim receipts while continuing our process-reengineering
    efforts, our development of a paperless claims processing system, and
    the creation of a Virtual Lifetime Electronic Record.
        We are also requesting a substantial investment for our
    homelessness programs as part of our plan to ultimately eliminate
    Veterans' homelessness through an aggressive approach that includes
    housing, education, jobs, and healthcare.
        VA will be successful in resolving these three concerns by
    maintaining a clear focus on developing innovative business processes
    and delivery systems that will not only serve Veterans and their
    families for many years to come, but will also dramatically improve the
    efficiency of our operations by better controlling long-term costs. By
    making appropriate investments today, we can ensure higher value and
    better outcomes for our Veterans. The 2011 budget also supports many
    key investments in VA's six high priority performance goals (HPPGs).

                      HPPG I: REDUCING THE CLAIMS BACKLOG

        The volume of compensation and pension rating-related claims has
    been steadily increasing. In 2009, for the first time, we received over
    1 million claims during the course of a single year. The volume of
    claims received has increased from 578,773 in 2000 to 1,013,712 in 2009
    (a 75 percent increase). Original disability compensation claims with
    eight or more claimed issues have increased from 22,776 in 2001 to
    67,175 in 2009 (nearly a 200 percent increase). Not only is VA
    receiving substantially more claims, but the claims have also increased
    in complexity. We expect this level of growth in the number of claims
    received to continue in 2010 and 2011 (increases of 13 percent and 11
    percent were projected respectively even without claims expected under
    new presumptions related to Agent Orange exposure), which is driven by
    improved access to benefits through initiatives such as the Benefits
    Delivery at Discharge Program, increased demand as a result of nearly
    10 years of war, and the impact of a difficult economy prompting
    America's Veterans to pursue access to the benefits they earned during
    their military service.
        While the volume and complexity of claims has increased, so too has
    the productivity of our claims processing workforce. In 2009, the
    number of claims processed was 977,219, an increase of 8.6 percent over
    the 2008 level of 899,863. The average time to process a rating-related
    claim fell from 179 to 161 days in 2009, an improvement of 11 percent.
        The progress made in 2009 is a step in the right direction, but it
    is not nearly enough. My goal is to process claims so no Veteran has to
    wait more than 125 days. Reaching this goal will become even more
    challenging because of additional claims we expect to receive related
    to Veterans' exposure to Agent Orange. Adding Parkinson's disease,
    ischemic heart disease, and B-cell leukemias to the list of presumptive
    disabilities is projected to significantly increase claims inventories
    in the near term, even while we make fundamental improvements to the
    way we process disability compensation claims.
        We expect the number of compensation and pension claims received to
    increase from 1,013,712 in 2009 to 1,318,753 in 2011 (a 30 percent
    increase). Without the significant investment requested for staffing in
    this budget, the inventory of claims pending would grow from 416,335 to
    1,018,343 and the average time to process a claim would increase from
    161 to 250 days. If Congress provides the funding requested in our
    budget, these increases are projected to be 804,460 claims pending with
    an average processing time of 190 days. Through 2011, we expect over
    228,000 claims related to the new presumptions and are dedicated to
    processing this near-term surge in claims as efficiently as possible.
        This budget is based on our plan to improve claims processing by
    using a three-pronged approach involving improved business processes,
    expanded technology, and hiring staff to bridge the gap until we fully
    implement our long-range plan. We will explore process and policy
    simplification and contracted service support in addition to the
    traditional approach of hiring new employees to address this spike in
    demand. We expect these transformational approaches to begin yielding
    significant performance improvements in fiscal year 2012 and beyond;
    however, it is important to mitigate the impact of the increased
    workload until that time.
        The largest increase in our 2011 budget request, in percentage
    terms, is directed to the Veterans Benefits Administration as part of
    our mitigation of the increased workload. The President's 2011 budget
    request for VBA is $2.149 billion, an increase of $460 million, or 27
    percent, over the 2010 enacted level of $1.689 billion. The 2011 budget
    supports an increase of 4,048 FTEs, including maintaining temporary FTE
    funded through ARRA. In addition, the budget also includes $145.3
    million in information technology (IT) funds in 2011 to support the
    ongoing development of a paperless claims processing system.

                   HPPG II: ELIMINATING VETERAN HOMELESSNESS

        Our Nation's Veterans experience higher than average rates of
    homelessness, depression, substance abuse, and suicides; many also
    suffer from joblessness. On any given night, there are about 107,000
    Veterans who live on the streets, representing every war and
    generation, including those who served in Iraq and Afghanistan. VA's
    major homeless-specific programs constitute the largest integrated
    network of homeless treatment and assistance services in the country.
    These programs provide a continuum of care for homeless Veterans,
    providing treatment, rehabilitation, and supportive services that
    assist homeless Veterans in addressing health, mental health and
    psychosocial issues. VA also offers a full range of support necessary
    to end the cycle of homelessness by providing education, jobs, and
    healthcare, in addition to safe housing. We will increase the number
    and variety of housing options available to homeless Veterans and those
    at risk of homelessness with permanent, transitional, contracted,
    community-operated, HUD-VASH provided, and VA-operated housing.
        Homelessness is primarily a healthcare issue, heavily burdened with
    depression and substance abuse. VA's budget includes $4.2 billion in
    2011 to prevent and reduce homelessness among Veterans--over $3.4
    billion for core medical services and $799 million for specific
    homeless programs and expanded medical programs. Our budget includes an
    additional investment of $294 million in programs and new initiatives
    to reduce the cycle of homelessness, which is almost 55 percent higher
    than the resources provided for homelessness programs in 2010.
        VA's healthcare costs for homeless Veterans can drop in the future
    as the Department emphasizes education, jobs, and prevention and
    treatment programs that can result in greater residential stability,
    gainful employment, and improved health status.

                HPPG III: AUTOMATING THE GI BILL BENEFITS SYSTEM

        The Post 9/11 GI Bill creates a robust enhancement of VA's
    education benefits, evoking the World War II Era GI Bill. Because of
    the significant opportunities the Act provides to Veterans in
    recognition of their service, and the value of the program in the
    current economic environment, we must deliver the benefits in this Act
    effectively and efficiently, and with a client-centered approach. In
    August 2009, the new Post-9/11 GI Bill program was launched. We
    received more than 496,000 original applications, 578,000 enrollment
    certifications, and 237,000 changes to enrollment certifications since
    the inception of this program.
        The 2011 budget provides $44.1 million to complete the automated
    solution for processing Post-9/11 GI Bill claims and to begin the
    development and implementation of electronic systems to process claims
    associated with other education programs. The automated solution for
    the Post 9/11 GI Bill education program will be implemented by December
    2010.
        In 2011, we expect the total number of all types of education
    claims to grow by 32.3 percent over 2009, from 1.70 million to 2.25
    million. To meet this increasing workload and complete education claims
    in a timely manner, VA has established a comprehensive strategy to
    develop an end-to-end solution that utilizes rules-based, industry-
    standard technologies to modernize the delivery of education benefits.

           HPPG IV: ESTABLISHING A VIRTUAL LIFETIME ELECTRONIC RECORD

        Each year, more than 150,000 active and reserve component service
    members leave the military. Currently, this transition is heavily
    reliant on the transfer of paper-based administrative and medical
    records from the Department of Defense (DOD) to the Veteran, the VA or
    other non-VA healthcare providers. A paper-based transfer carries risks
    of errors or oversights and delays the claim process.
        In April 2009, the President charged me and Defense Secretary Gates
    with building a fully interoperable electronic records system that will
    provide each member of our armed forces a Virtual Lifetime Electronic
    Record (VLER). This virtual record will enhance the timely delivery of
    high-quality benefits and services by capturing key information from
    the day they put on the uniform, through their time as Veterans, until
    the day they are laid to rest. The VLER is the centerpiece of our
    strategy to better coordinate the user-friendly transition of service
    members from their service component into VA, and to produce better,
    more timely outcomes for Veterans in providing their benefits and
    services.
        In December 2009, VA successfully exchanged electronic health
    record (EHR) information in a pilot program between the VA Medical
    Center in San Diego and a local Kaiser Permanente hospital. We
    exchanged EHR information using the Nationwide Health Information
    Network (NHIN) created by the Department of Health and Human Services.
    Interoperability is key to sharing critical health information.
    Utilizing the NHIN standards allows VA to partner with private sector
    healthcare providers and other Federal agencies to promote better,
    faster, and safer care for Veterans. During the second quarter of 2010,
    the DOD will join this pilot and we will announce additional VLER
    health community sites.
        VA has $52 million in IT funds in 2011 to continue the development
    and implementation of this Presidential priority.

                      HPPG V: IMPROVING MENTAL HEALTH CARE

        The 2011 budget continues the Department's keen focus on improving
    the quality, access, and value of mental healthcare provided to
    Veterans. VA's budget provides over $5.2 billion for mental health, an
    increase of $410 million, or 8.5 percent, over the 2010 enacted level.
    We will expand inpatient, residential, and outpatient mental health
    programs with an emphasis on integrating mental health services with
    primary and specialty care.
        Post-Traumatic Stress Disorder (PTSD) is the mental health
    condition most commonly associated with combat, and treating Veterans
    who suffer from this debilitating disorder is central to VA's mission.
    Screening for PTSD is the first and most essential step. It is crucial
    that VA be proactive in identifying PTSD and intervening early in order
    to prevent chronic problems that could lead to more complex disorders
    and functional problems.
        VA will also expand its screening program for other mental health
    conditions, most notably traumatic brain injury (TBI), depression, and
    substance use disorders. We will enhance our suicide prevention
    advertising campaign to raise awareness among Veterans and their
    families of the services available to them.
        More than one-fifth of the Veterans seen last year had a mental
    health diagnosis. In order to address this challenge, VA has
    significantly invested in our mental health workforce, hiring more than
    6,000 new workers since 2005.
        In October 2009, VA and DOD held a mental health summit with mental
    health experts from both departments, and representatives from Congress
    and more than 57 non-government organizations. We convened the summit
    to discuss an innovative, wide-ranging public health model for
    enhancing mental health for returning service members, Veterans, and
    their families. VA will use the results to devise new innovative
    strategies for improving the health and quality of life for Veterans
    suffering from mental health problems.

          HPPG VI: DEPLOYING A VETERANS RELATIONSHIP MANAGEMENT SYSTEM

        A key component of VA's transformation is to employ technology to
    dramatically improve service and outreach to Veterans by adopting a
    comprehensive Veterans' Relationship Management System to serve as the
    primary interface between Veterans and the Department. This system will
    include a framework that provides Veterans with the ability to:
      --Access VA through multiple methods;
      --Uniformly find information about VA's benefits and services;
      --Complete multiple business processes within VA without having to
            re-enter identifying information; and
      --Seamlessly access VA across multiple lines of business.
        This system will allow Veterans to access comprehensive online
    information anytime and anywhere via a single consistent entry point.
    Our goal is to deploy the Veterans Relationship Management System in
    2011. Our budget provides $51.6 million for this project.
        In addition to resources supporting these high-priority performance
    goals, the President's budget enhances and improves services across the
    full spectrum of the Department. The following highlights funding
    requirements for selected programs along with the outcomes we will
    achieve for Veterans and their families.

                      DELIVERING WORLD-CLASS MEDICAL CARE

        The Budget provides $51.5 billion for medical care in 2011, an
    increase of $4 billion, or 8.5 percent, over the 2010 level. This level
    will allow us to continue providing timely, high-quality care to all
    enrolled veterans. Our total medical care level is comprised of funding
    for medical services ($37.1 billion), medical support and compliance
    ($5.3 billion), medical facilities ($5.7 billion), and resources from
    medical care collections ($3.4 billion). In addition to reducing the
    number of homeless Veterans and expanding access to mental healthcare,
    our 2011 budget will also achieve numerous other outcomes that improve
    Veterans' quality of life, including:
      --Providing extended care and rural health services in clinically
            appropriate settings;
      --Expanding the use of home telehealth;
      --Enhancing access to healthcare services by offering enrollment to
            more Priority Group 8 Veterans and activating new facilities;
            and
      --Meeting the medical needs of women Veterans.
        During 2011, we expect to treat nearly 6.1 million unique patients,
    a 2.9 percent increase over 2010. Among this total are over 439,000
    Veterans who served in Operation Enduring Freedom and Operation Iraqi
    Freedom, an increase of almost 57,000 (or 14.8 percent) above the
    number of Veterans from these two campaigns that we anticipate will
    come to VA for healthcare in 2010.
        In 2011, the budget provides $2.6 billion to meet the healthcare
    needs of Veterans who served in Iraq and Afghanistan. This is an
    increase of $597 million (or 30.2 percent) over our medical resource
    requirements to care for these Veterans in 2010. This increase also
    reflects the impact of the recent decision to increase troop size in
    Afghanistan. The treatment of this newest generation of Veterans has
    allowed us to focus on, and improve treatment for, PTSD as well as TBI,
    including new programs to reach Veterans at the earliest stages of
    these conditions.
        The fiscal year 2011 Budget also includes funding for new patients
    resulting from the recent decision to add Parkinson's disease, ischemic
    heart disease, and B-cell leukemias to the list of presumptive
    conditions for Veterans with service in Vietnam.

    Extended Care and Rural Health
        VA's budget for 2011 contains $6.8 billion for long-term care, an
    increase of 858.8 million (or 14.4 percent) over the 2010 level. In
    addition, $1.5 billion is included for non-institutional long-term
    care, an increase of $276 million (or 22.9 percent) over 2010. By
    enhancing Veterans' access to non-institutional long-term care, VA can
    provide extended care services to Veterans in a more clinically
    appropriate setting, closer to where they live, and in the comfort and
    familiar settings of their homes.
        VA's 2011 budget also includes $250 million to continue
    strengthening access to healthcare for 3.2 million enrolled Veterans
    living in rural and highly rural areas through a variety of avenues.
    These include new rural health outreach and delivery initiatives and
    expanded use of home-based primary care, mental health, and telehealth
    services. VA intends to expand use of cutting edge telehealth
    technology to broaden access to care while at the same time improve the
    quality of our healthcare services.

    Home Telehealth
        Our increasing reliance on non-institutional long-term care
    includes an investment in 2011 of $163 million in home telehealth.
    Taking greater advantage of the latest technological advancements in
    healthcare delivery will allow us to more closely monitor the health
    status of Veterans and will greatly improve access to care for Veterans
    in rural and highly rural areas. Telehealth will place specialized
    healthcare professionals in direct contact with patients using modern
    IT tools. VA's home telehealth program cares for 35,000 patients and is
    the largest of its kind in the world. A recent study found patients
    enrolled in home telehealth programs experienced a 25 percent reduction
    in the average number of days hospitalized and a 19 percent reduction
    in hospitalizations. Telehealth and telemedicine improve healthcare by
    increasing access, eliminating travel, reducing costs, and producing
    better patient outcomes.

    Expanding Access to Health Care
        In 2009 VA opened enrollment to Priority 8 Veterans whose incomes
    exceed last year's geographic and VA means-test thresholds by no more
    than 10 percent. Our most recent estimate is that 193,000 more Veterans
    will enroll for care by the end of 2010 due to this policy change.
        In 2011 VA will further expand healthcare eligibility for Priority
    8 Veterans to those whose incomes exceed the geographic and VA means-
    test thresholds by no more than 15 percent compared to the levels in
    effect prior to expanding enrollment in 2009. This additional expansion
    of eligibility for care will result in an estimated 99,000 more
    enrollees in 2011 alone, bringing the total number of new enrollees
    from 2009 to the end of 2011 to 292,000.

    Meeting the Medical Needs of Women Veterans
        The 2011 budget provides $217.6 million to meet the gender-specific
    healthcare needs of women Veterans, an increase of $18.6 million (or
    9.4 percent) over the 2010 level. The delivery of enhanced primary care
    for women Veterans remains one of the Department's top priorities. The
    number of women Veterans is growing rapidly and women are increasingly
    reliant upon VA for their healthcare.
        Our investment in healthcare for women Veterans will lead to higher
    quality of care, increased coordination of care, enhanced privacy and
    dignity, and a greater sense of security among our women patients. We
    will accomplish this through expanding healthcare services provided in
    our Vet Centers, increasing training for our healthcare providers to
    advance their knowledge and understanding of women's health issues, and
    implementing a peer call center and social networking site for women
    combat Veterans. This call center will be open 24 hours a day, 7 days a
    week.

                ADVANCE APPROPRIATIONS FOR MEDICAL CARE IN 2012

        VA is requesting advance appropriations in 2012 of $50.6 billion
    for the three medical care appropriations to support the healthcare
    needs of 6.2 million patients. The total is comprised of $39.6 billion
    for Medical Services, $5.5 billion for Medical Support and Compliance,
    and $5.4 billion for Medical Facilities. In addition, $3.7 billion is
    estimated in medical care collections, resulting in a total resource
    level of $54.3 billion. It does not include additional resources for
    any new initiatives that would begin in 2012.
        Our 2012 advance appropriations request is based largely on our
    actuarial model using 2008 data as the base year. The request continues
    funding for programs that we will continue in 2012 but which are not
    accounted for in the actuarial model. These initiatives address
    homelessness and expanded access to non-institutional long-term care
    and rural healthcare services through telehealth. In addition, the 2012
    advance appropriations request includes resources for several programs
    not captured by the actuarial model, including long-term care, the
    Civilian Health and Medical Program of the Department of Veterans
    Affairs, Vet Centers, and the state home per diem program. Overall, the
    2012 requested level, based on the information available at this point
    in time, is sufficient to enable us to provide timely and high-quality
    care for the estimated patient population. We will continue to monitor
    cost and workload data throughout the year and, if needed, we will
    revise our request during the normal 2012 budget cycle.
        After a cumulative increase of 26.4 percent in the medical care
    budget since 2009, we will be working to reduce the rate of increase in
    the cost of the provision of healthcare by focusing on areas such as
    better leveraging acquisitions and contracting, enhancing use of
    referral agreements, strengthening DOD/VA joint ventures, and expanding
    applications of medical technology (e.g. telehome health).

                        INVESTMENTS IN MEDICAL RESEARCH

        VA's budget request for 2011 includes $590 million for medical and
    prosthetic research, an increase of $9 million over the 2010 level.
    These research funds will help VA sustain its long track record of
    success in conducting research projects that lead to clinically useful
    interventions that improve the health and quality of life for Veterans
    as well as the general population.
        This budget contains funds to continue our aggressive research
    program aimed at improving the lives of Veterans returning from service
    in Iraq and Afghanistan. This focuses on prevention, treatment, and
    rehabilitation research, including TBI and polytrauma, burn injury
    research, pain research, and post-deployment mental health research.

              SUSTAINING HIGH QUALITY BURIAL AND MEMORIAL PROGRAMS

        VA remains steadfastly committed to providing access to a dignified
    and respectful burial for Veterans choosing to be buried in a VA
    national cemetery. This promise to Veterans and their families also
    requires that we maintain national cemeteries as shrines dedicated to
    the memory of those who honorably served this Nation in uniform. This
    budget implements new policy to expand access by lowering the Veteran
    population threshold for establishing new national cemeteries and
    developing additional columbaria to better serve large urban areas.
        VA expects to perform 114,300 interments in 2011 or 3.8 percent
    more than in 2010. The number of developed acres (8,441) that must be
    maintained in 2011 is 4.6 percent greater than the 2010 estimate, while
    the number of gravesites (3,147,000) that will be maintained is 2.6
    percent higher. VA will also process more than 617,000 Presidential
    Memorial Certificates in recognition of Veterans' honorable military
    service.
        Our 2011 budget request includes $251 million in operations and
    maintenance funding for the National Cemetery Administration. The 2011
    budget request provides $36.9 million for national shrine projects to
    raise, realign, and clean an estimated 668,000 headstones and markers,
    and repair 100,000 sunken graves. This is critical to maintaining our
    extremely high client satisfaction scores that set the national
    standard of excellence in government and private sector services as
    measured by the American Customer Satisfaction Index. The share of our
    clients who rate the quality of the memorial services we provide as
    excellent will rise to 98 percent in 2011. The proportion of clients
    who rate the appearance of our national cemeteries as excellent will
    grow to 99 percent. And we will mark 95 percent of graves within 60
    days of interment.
        The 2011 budget includes $3 million for solar and wind power
    projects at three cemeteries to make greater use of renewable energy
    and to improve the efficiency of our program operations. It also
    provides $1.25 million to conduct independent Facility Condition
    Assessments at national cemeteries and $2 million for projects to
    correct safety and other deficiencies identified in those assessments.

                       LEVERAGING INFORMATION TECHNOLOGY

        We cannot achieve the transformation of VA into a 21st century
    organization capable of meeting Veterans' needs today and in the years
    to come without leveraging the power of IT. The Department's IT program
    is absolutely integral to everything we do, and it is vital we continue
    the development of IT systems that will meet new service delivery
    demands and modernize or replace increasingly fragile systems that are
    no longer adequate in today's healthcare and benefits delivery
    environment. Simply put, IT is indispensable to achieving VA's mission.
        The Department's IT operations and maintenance program supports
    334,000 users, including VA employees, contractors, volunteers, and
    researchers situated in 1,400 healthcare facilities, 57 regional
    offices, and 158 national cemeteries around the country. Our IT program
    protects and maintains 8.5 million vital health and benefits records
    for Veterans with the level of privacy and security mandated by both
    statutes and directives.
        VA's 2011 budget provides $3.3 billion for IT, the same level of
    funding provided in 2010. We have prioritized potential IT projects to
    ensure that the most mission-critical projects for improving service to
    Veterans are funded. For example, the resources we are requesting will
    fund the development and implementation of an automated solution for
    processing education claims ($44.1 million), the Financial and
    Logistics Integrated Technology Enterprise project to replace our
    outdated, non-compliant core accounting system ($120.2 million),
    development and deployment of the paperless claims processing system
    ($145.3 million), and continued development of HealtheVet, VA's
    electronic health record system ($346.2 million). In addition, the 2011
    budget request includes $52 million for the advancement of the Virtual
    Lifetime Electronic Record, a Presidential priority that involves our
    close collaboration with DOD.

                    ENHANCING OUR MANAGEMENT INFRASTRUCTURE

        A critical component of our transformation is to create a reliable
    management infrastructure that expands or enhances corporate
    transparency at VA, centralizes leadership and decentralizes execution,
    and invests in leadership training. This includes increasing investment
    in training and career development for our career civil service and
    employing a suitable financial management system to track expenditures.
    The Department's 2011 budget provides $463 million in General
    Administration to support these vital corporate management activities.
    This includes $23.6 million in support of the President's initiative to
    strengthen the acquisition workforce.
        We will place particular emphasis on increasing our investment in
    training and career development--helping to ensure that VA's workforce
    remain leaders and standard-setters in their fields, skilled,
    motivated, and client-oriented. Training and development (including a
    leadership development program), communications and team building, and
    continuous learning will all be components of reaching this objective.

                             CAPITAL INFRASTRUCTURE

        VA must provide timely, high-quality healthcare in medical
    infrastructure which is, on average, over 60 years old. In the 2011
    budget, we are requesting $1.6 billion to invest in our major and minor
    construction programs to accomplish projects that are crucial to right
    sizing and modernizing VA's healthcare infrastructure, providing
    greater access to benefits and services for more Veterans, closer to
    where they live, and adequately addressing patient safety and other
    critical facility deficiencies.

    Major Construction
        The 2011 budget request for VA major construction is $1.151
    billion. This includes funding for five medical facility projects in
    New Orleans, Louisiana; Denver, Colorado; Palo Alto and Alameda,
    California; and Omaha, Nebraska.
        This request provides $106.9 million to support the Department's
    burial program, including gravesite expansion and cemetery improvement
    projects at three national cemeteries--Indiantown Gap, Pennsylvania;
    Los Angeles, California; and Tahoma, Washington.
        Our major construction request includes $51.4 million to begin
    implementation of a new policy to expand and improve access to burial
    in a national cemetery. Most significantly, this new policy lowers the
    Veteran population threshold to build a new national cemetery from
    170,000 to 80,000 Veterans living within 75 miles of a cemetery. This
    will provide access to about 500,000 additional Veterans. Moreover, it
    will increase our strategic target for the percent of Veterans served
    by a burial option in a national or state Veterans cemetery within 75
    miles of their residence from 90 percent to 94 percent.
        VA's major construction request also includes $24 million for
    resident engineers that support medical facility and national cemetery
    projects. This represents a new source of funding for the resident
    engineer program, which was previously funded under General Operating
    Expenses.

    Minor Construction
        The $467.7 million request for 2011 for minor construction is an
    integral component of our overall capital program. In support of the
    medical care and medical research programs, minor construction funds
    permit VA to realign critical services; make seismic corrections;
    improve patient safety; enhance access to healthcare; increase capacity
    for dental care; enhance patient privacy; improve treatment of special
    emphasis programs; and expand our research capability. Minor
    construction funds are also used to improve the appearance of our
    national cemeteries. Further, minor construction resources will be used
    to comply with energy efficiency and sustainability design
    requirements.

                                    SUMMARY

        Our job at the VA is to serve Veterans by increasing their access
    to VA benefits and services, to provide them the highest quality of
    healthcare available, and to control costs to the best of our ability.
    Doing so will make VA a model of good governance. The resources
    provided in the 2011 President's budget will permit us to fulfill our
    obligation to those who have bravely served our country.
        The 298,000 employees of the VA are committed to providing the
    quality of service needed to serve our Veterans and their families.
    They are our most valuable resource. I am especially proud of several
    VA employees that have been singled out for special recognition this
    year.
        First, let me recognize Dr. Janet Kemp, who received the ``2009
    Federal Employee of the Year'' award from the Partnership for Public
    Service. Under Dr. Kemp's leadership, VA created the Veterans National
    Suicide Prevention Hotline to help Veterans in crisis. To date, the
    Hotline has received almost 256,000 calls and rescued about 8,100
    people judged to be at imminent risk of suicide since its inception.
        Second, we are also very proud of Nancy Fichtner, an employee at
    the Grand Junction Colorado Medical Center, for being the winner of the
    President's first-ever SAVE (Securing Americans Value and Efficiency)
    award. Ms. Fichtner's winning idea is for Veterans leaving VA hospitals
    to be able to take medication they have been using home with them
    instead of it being discarded upon discharge.
        And third, we are proud of the VA employees at our Albuquerque, New
    Mexico Clinical Research Pharmacy Coordinating Center, including the
    Center Director, Mike R. Sather, for excellence in supporting clinical
    trials targeting current Veteran health issues. Their exceptional and
    important work garnered the center's recognition as the 2009 Malcolm
    Baldrige National Quality Award Recipient in the nonprofit category.
        The VA is fortunate to have public servants that are not only
    creative thinkers, but also able to put good ideas into practice. With
    such a workforce, and the continuing support of Congress, I am
    confident we can achieve our shared goal of accessible, high-quality
    and timely care and benefits for Veterans.

                                 CLAIMS BACKLOG

        Senator Johnson. Thank you, Secretary Shinseki.
        In the 4 years that I have chaired this subcommittee, we
    have provided a total of $427 million above what the VA
    requested to hire additional claims processors to reduce the
    claims backlog. I am pleased to see that this year's budget
    request reflects a significant increase over last year to hire
    claims processors. However, the average claims time still
    hovers around 161 days and is expected to increase, given the
    new decision regarding Agent Orange.
        I know that the task of transforming the VA is daunting,
    but the level of frustration that vets expressed to me is
    growing.
        When can we expect to see some tangible results from the
    investments that we are making into the VBA claims process?
        Secretary Shinseki. Mr. Chairman, if there is frustration
    to go around, I share a good bit of it.
        I wanted to put a little more of my attention into the
    claims backlog last year. I got diverted a little bit. I spent
    some time making sure that the 9/11 G.I. bill was up and
    running properly, and now that it is, this year for me and for
    VA is about breaking the back in the backlog, getting to the
    root causes of what creates this as a never-ending challenge.
    Last year, we produced 977,000 decisions on claims, and then we
    got a million new claims in return. So this is a big numbers
    issue.
        Today we have probably 11,400 claims adjudicators, and this
    number of workforce, good people who come to work every day,
    takes a while to get them trained up. They provide us the
    ability to take that average processing time from, at one
    point, 190 days, and we have worked our way down to about 160
    days now, headed toward that 125 goal as an average.
        With this budget for 2011, we have increased VBA's budget
    by 27 percent. A good portion of that resources initiatives
    underway, but also adds 4,000 people to the workforce. And
    right now, if we want to go faster, the solution is to hire
    more people because we lack the automation tools that should
    have helped us break the code some time ago. We are working on
    developing those tools, and I will turn to Secretary Baker in a
    second to give you an assessment of where we are.
        I will also tell you that we created four pilots to take
    this process apart and look at those pieces individually and we
    intend to put them back together in a way that makes greater
    sense, simpler, less complex, and then try to get momentum here
    at the same time we are developing these tools.
        This year, 2010, I am happy to report that we have the
    resources in the right place, and we have the leadership
    focused on how to do this correctly.
        So let me turn to Secretary Baker and then I will turn to
    Mike Walcoff here for any other comments he might like to
    provide.
        Mr. Baker. Thank you, Mr. Secretary. Just quickly recapping
    where we are on the paperless system, the Veterans Benefits
    Management System. There are a number of pilots in place right
    now looking at different processes and different technologies
    to move VBA forward, one in Baltimore that we are particularly
    proud of, the Virtual Regional Office, that ties together
    process changes with technology to demonstrate what can be done
    inside of VBA. We will be letting contracts in the spring and
    the summer to get that fully implemented into pilots during
    2011 at VBA regional offices and then full rollout starting in
    late 2011 and 2012 of the paperless system across the entire
    VBA enterprise.
        Now, the paperless system does two things for us. One
    clearly is moving the system away from being paper-bound and
    into electronic. But the second is making it much more flexible
    for the VBA to look at their processes and make changes in
    their processes that will speed the way the work is done on top
    of the electronic system. So we are making good progress in
    that area at this point, primarily driven by our Chief
    Technology Officer, Peter Levin, and I think we have
    substantial progress to this point and you will see substantial
    progress through the rest of 2010 and 2011.
        Mr. Walcoff. Thank you, Mr. Secretary.
        Just a couple of things that I want to add. The Secretary
    mentioned that we are going to be hiring more people. Secretary
    Baker talked about the technology. And we also mentioned the
    pilots that we are doing that are looking at the business
    process itself to determine what can we do to improve the
    process so that when we have the new tools, it will not be just
    adding the tools to the old process.
        In addition to that, we recently brought all of our
    leadership together about a month ago and laid out for them
    what the challenge was. The Secretary has set some very, very
    ambitious goals for us. We always used to talk about time
    limits in terms of average. So when we said our goal was 125
    days, it was that the average case would take 125 days. This
    goal is a lot more ambitious where he is saying that he is
    eliminating any cases over 125 days and, at the same time,
    doing it with a 98 percent accuracy rate. That is really
    putting the challenge to us and saying we have to change the
    basic way we do business in order to accomplish that.
        We talked with our directors. We got a lot of really good
    ideas. We have some things that we are going to implement
    immediately. Just to give you an example, we are looking at
    doing what we call interim ratings where, for instance, on
    Agent Orange, if a veteran applies, is able to establish
    Vietnam service, has a diagnosis of, say, ischemic heart
    disease, but we do not have an exam to determine how disabling
    is the condition, we would pay him immediately at a minimum
    rate so he at least starts getting benefits and starts getting
    entitlement to things like voc rehab and treatment at VA
    hospitals while we go and do the exam to determine what his
    permanent rating would be. Those are the kinds of things that
    we believe we need to do to improve the service that we are
    providing to veterans.
        Senator Johnson. My time has expired.
        Senator Hutchison.

                              PRESUMPTIVE DISEASES

        Senator Hutchison. Thank you very much, Mr. Chairman.
        On the gulf war illness issue, your task force recommended
    nine new conditions to be automatic presumptions, and I am very
    pleased because these young men and women have been really in
    never-never land for a long time. I think that hitting it now
    rather than waiting so long, as was done in Agent Orange, it is
    still late, but I am glad we are doing it.
        This is my question. What is the timetable that you have
    after you have your rulemaking and you go through all of the
    required processes, that you think you will make the final
    determination on the gulf war syndrome presumptions? And then
    after learning the timetable, then I am wondering on the budget
    what you will expect, if it is going to be able to be covered
    this year, or will you have to accommodate that next year.
        Secretary Shinseki. I am going to turn to Dr. Petzel on
    this.
        Dr. Petzel. Thank you, Mr. Secretary.
        The process by which presumption is established is that
    there is a gulf war task force that will look at information
    such as the IOM report that recently came out regarding the
    gulf war. They will then make a recommendation to the Secretary
    as to illnesses that ought to be considered presumptive. The
    decision then is his as to what illnesses will be presumptive
    and what illnesses will not. And then there is a rulemaking
    process that occurs after the Secretary's decision has been
    made. As an example, I believe that the decision and the rules
    regarding Agent Orange, where the decision was made this early
    spring/late winter, will be finished, Michael, sometime----
        Mr. Walcoff. Early July.
        Dr. Petzel. In the late summer.
        Mr. Walcoff. Correct.
        Dr. Petzel. So, Senator, that would be the process by which
    we establish presumption.
        Senator Hutchison. So give me a guesstimate then. Is it 9
    months you are talking about after you get the recommendation
    and then there is the rulemaking and then the publication? I am
    just getting just a general idea. I am not asking for some
    blood oath, but just a general idea of what are we looking at
    in a timetable?
        Secretary Shinseki. I believe we will begin and will have
    the rulemaking done this summer, and then we will begin
    processing claims. It will be late summer timeframe.

                          FORT BLISS JOINT FACILITIES

        Senator Hutchison. Okay. That is what I needed. Thank you.
        So we will probably need--I know it is not in this year's
    budget. So we will probably need to address that at some point
    in the future.
        The other question that I have--General, you and I have
    talked about this, but the VA and the Army currently share
    joint facilities at Fort Bliss, and as we all know, Fort Bliss
    is in the process of being plused-up by about 30,000 troops.
    And that is going to affect the retiree population as well.
    Once the Army leaves the facility, the VA is going to be in a
    problem situation if the VA does not move with the Army.
        This is my question. The funding for the new hospital that
    is, at this stage, planned to be a joint facility, Army and VA,
    is in the Army's 2011 budget request and in the 2009 stimulus
    and then the 2009 war supplemental. The Army is ready to move
    and it is not in your budget this year because you were
    planning for all of this to be 1 year out.
        My question is, what are your plans? A, are you committed
    to the joint facility with the Army at Fort Bliss? And B, what
    are you thinking in updating your timetable to go along with
    the Army?
        Secretary Shinseki. Senator, we are committed to an
    integrated effort with the Army. We are a bit mid-stride right
    now because we planned on and were programmed for a 2012 start.
    So this acceleration to 2011 leaves us in a position where we
    do not have the resources to do that. We are looking at what
    options might be available to us. It also requires about a $20
    million design investment this year, 2010. So we are looking at
    that as well.
        And while we may be successful in being able to find those
    dollars, 2011 still remains an issue. I do not have the
    resources for it right now. It is not in my budget, and there
    are a number of longstanding projects that are on execution for
    us, and I would prefer to keep that priority because there have
    been veterans waiting for those assets to be provided. But we
    are interested in staying abreast of the Army's move here. We
    think it is important for it to be an integrated facility, and
    so we are looking at this hard.
        Senator Hutchison. You believe that you can have the $20
    million that would work with the Army to start the planning
    process in June. Is that correct?
        Secretary Shinseki. We are locating those dollars. I think
    there is a good chance we will do that, but I am hesitant to
    put $20 million up without understanding how we take care of
    2011, and right now I do not have resources.
        Senator Hutchison. Well, I will look forward to having you
    come to us with your suggestions, and then we certainly will be
    helpful because it would not make sense not to be joint and it
    would leave a big void if the Army moved and you did not. And
    it also would not be a wise use of taxpayer dollars when a
    joint effort would be so much more efficient. So I will look
    forward to hearing from you and helping as well. Thank you.
        Secretary Shinseki. Thank you.
        Senator Johnson. Senator Nelson.

                                   OMAHA VAMC

        Senator Nelson. Thank you, Mr. Chairman.
        Thank you, Secretary Shinseki for testifying today. I am
    particularly pleased with your budget this year. I know the
    increases are there and there will be those who ask questions
    about why during these difficult times are we having increases.
    But the various causes that you are addressing in your budget
    are the kinds of things that I think, in spite of difficult
    times, we still have to identify and help.
        And I was especially pleased to see in your fiscal year
    2011 budget request that it addresses the needs of the Omaha VA
    Hospital. As we have discussed, this institution provides very
    good care for veterans, and I know Dr. Petzel knows that. But
    the physical facility is stuck back in the 20th century. Built
    back in the 1950s, upgrades to the facility and its equipment
    have served well, but now it is in need of a major overhaul.
    And working with your predecessor, Secretary Peake, and you, we
    have pushed to see that the hospital shortcomings are being
    addressed. You personally are well aware of these shortcomings,
    but for the record, I think they bear noting.
        A study by the VA, released last summer, found a number of
    critical functional deficiencies. I will not name all of them,
    but I will address a few. Significant space deficiencies.
    Forty-two out of 52 departments will need additional space.
    Surgical capacity is based on 1948 design. Present space does
    not meet room size, privacy requirements. A deteriorating
    building envelope, including problems with windows, walls, and
    the roof. Air handling and HVAC system beyond useful life, and
    overall refrigeration systems rated an F.
        In addition, the hospital has a unitary heating and cooling
    system and health officials have shared serious concerns about
    a virus such as the recent H1N1 virus being spread by this HVAC
    throughout the entire hospital, providing less than adequate
    health safety for the patients.
        So for these reasons, I am very pleased to see that your
    2011 budget calls for $56 million for planning and design
    toward substantial modernization of this hospital. It is a
    necessary first step toward what we expect will be a 21st
    century healthcare facility. And, Secretary Shinseki, this
    commitment is extremely good news for the thousands of veterans
    both in Nebraska and western Iowa.
        I have often said that I hope we some day become--and I
    think you are in the process of doing that--as good at taking
    care of our veterans as we are creating them. And your
    commitment to improving the Omaha VA Hospital is just one more
    example that caring for American veterans remains one of the
    Nation's highest priorities and clearly is one of yours.
        So, Mr. Secretary, from your perspective, perhaps you could
    give us your idea why this is a high priority for the Veterans
    Administration to see an improved facility in Nebraska.
        Secretary Shinseki. There is a great tradition in the VA,
    Senator. When we have problems, we do not blame our
    predecessors. When something comes out right, we give credit to
    them as well. Jim Peake is an old friend. He and I soldiered
    together for many years. In fact, I selected him to be the
    Surgeon General when I was on my last service in uniform. He
    was my predecessor in 2008, I think. Because he was apprised of
    some shortfalls in the service, primarily the safety aspects of
    the hospital in Omaha, he initiated an independent study, not a
    VA study, but an independent study, to go in and make their own
    assessment to provide him some idea of what the conditions
    were. As things turned out, I inherited that study which came
    in the spring of last year, as I recall. We put it into our
    annual scoring process. I think the Omaha hospital at one point
    was 15 or 16 on a priority list. Seven of the projects in that
    list were funded in the previous year's budget. So it moved up,
    and so all of the projects moved up, at least moved up
    accordingly. One project was removed from the list, as I
    recall, for some reason, but then with this new independent
    study, the rescoring just put Omaha within the range to get the
    ranking it did.
        I think it came out well. It came out right. It was the
    right thing to do for veterans in that part of the country. But
    understand, Omaha is just the location of the hospital. It
    serves Iowa. It serves lots of adjacent States. So veterans in
    many locations are serviced by this hospital. Location is only
    one issue.
        So that is my take on it, Senator.

                               VETERANS CEMETERY

        Senator Nelson. Well, I appreciate that.
        I also want to commend you for the VA budget having design
    funds for a new national veterans cemetery in Sarpy County,
    Nebraska, also eastern Nebraska adjacent to the Omaha area,
    which will serve a number of veterans from a region. The
    location of that cemetery, as the location of the hospital,
    will catch not only some South Dakota residents, veterans, but
    Iowa and northern Missouri, as well as perhaps some of Kansas'
    as well. So we appreciate your focus on it. You are doing an
    outstanding job, and we appreciate the opportunity to work with
    you.
        And we want to compliment former Secretary Peake for his
    wisdom in stepping in and seeing that we get an independent
    study so that it is some outside thoughts, as well as our
    inside thoughts.
        Thank you very much.
        Thank you, Mr. Chairman.
        Senator Johnson. Senator Murkowski.

                                  RURAL ACCESS

        Senator Murkowski. Mr. Chairman, thank you.
        Secretary Shinseki, good to see you. Thank you for our
    conversation earlier in the week. Not only did we have a chance
    earlier this week to discuss the issue of access to care to so
    many of our veterans who live in very rural parts of the
    country, we talked about it last year and the challenges that
    particularly our Alaska Native veterans face in accessing their
    earned healthcare benefits when they come back to their
    villages and they are hundreds of miles from the nearest VA
    facility, the challenges that they face. And we have talked a
    little bit about the effort that has gone into the rural Alaska
    pilot project and the need to make sure that we make that pilot
    function a little more efficiently.
        I understand--and I thank you for your offer to visit with
    the folks over at Indian Health Service (IHS) to see how we
    cannot iron out some of those issues, but again, find an easier
    path for those veterans who are in some of our most rural
    communities and have access to an IHS facility, that we might
    be able to partner with some of that care. But we know that
    that is just one part of the problem in Alaska.
        The other dimension of access to our veterans in my State
    is we have got concerns that those that actually have access to
    the VA facilities there cannot access the facilities with their
    particular healthcare conditions. Sometimes demand exceeds the
    capacity. Sometimes our veterans are told that they have to
    travel to Seattle because the procedures are not available in
    Alaska, just not available within the facilities that we have.
    It is our understanding that these veterans are told, well, the
    regulations require us to send you outside to Seattle rather
    than purchase care within the community. I had asked whether or
    not you felt that the VA was being a little overly rigid in
    interpreting these regulations.
        But essentially what I am looking for and what I am hoping
    that we can work with you on is how we ensure that the
    commitment made to these Alaskans is kept without having to
    send them outside to care, a 2,000-mile trip, for some even
    more than 2,000 miles, to access care when it could be made
    available through purchased care within the State.
        Secretary Shinseki. Well, Senator, I appreciate those
    insights. I am reminded that in our geographical descriptions
    of our system, we have urban, rural, highly rural. So two-
    thirds of our definitions have the word ``rural'' in it, and
    then I am told that even highly rural may not describe some
    parts of the country and Alaska is one of them.
        We are going to look at very closely why we would send a
    veteran on a 2,000-mile journey if there is competent, safe
    healthcare available close by. We will take a look at that.
        This also behooves us to have a better working
    relationship, although we have already started this with the
    Indian Health Service, but a better relationship of sharing
    assets and capabilities so that we reach out into these areas.
    Even as hard as we are working at it, it is not still good
    enough. Telehealth is another capability we have invested in
    heavily. If there is any place we ought to be demonstrating the
    power of a microprocessor it would be in places like remote
    tribal lands in Alaska.
        Let me just turn to our senior medical officer, Dr. Petzel,
    and ask him for his insights here.
        Dr. Petzel. Thank you, Mr. Secretary.
        Senator Murkowski, I share your concern about the distance
    that some of these people have had to travel. We looked back
    and 685 veterans were asked to travel from Alaska down to a
    medical center in the Lower 48, usually Seattle, but it may
    have been other places. The question that I have when I heard
    that is what sorts of things are they being referred for. It is
    one thing to come down for open heart surgery, which may be a
    super-special kind of thing to do. But, on the other hand,
    routine surgery that we could be performing in Anchorage on a
    contract or on a fee basis probably ought to be looked at. So
    it is my intention to look at why those cases were sent, what
    kinds of cases were sent, and see if we can find out some sort
    of an arrangement that provides better, more community-level
    access for those veterans.
        Senator Murkowski. Well, Dr. Petzel, I appreciate that. In
    speaking with constituents that are expressing their concerns
    and their frustrations, what we are hearing is that a 6-week
    chemotherapy treatment--an individual lives in Fairbanks, our
    second-largest community, fine medical facilities, and yet they
    are being sent outside down to Seattle for treatment. I would
    like to think that that is one of those that should absolutely
    not be necessary for something as routine as chemotherapy
    treatment. So we would like to work with you on that. I would
    certainly like a better understanding myself. So much of what
    we know is anecdotal, but when we hear these anecdotes, this is
    something that for these families that have to make these
    transitions and spend 6 weeks down in a hotel in Seattle with
    no family members, the expense that is involved, but also the
    separation is something that is not the kind of care that I
    think our veterans certainly deserve and that we owe to them.
    So we want to work with you on this.
        Dr. Petzel. We would share your concern, Senator.
        Senator Murkowski. Thank you, Mr. Chairman.
        Senator Johnson. Senator Murray.

                              VETERANS EMPLOYMENT

        Senator Murray. Thank you very much, Mr. Chairman. And I
    would tell my colleague from Alaska that we would happily take
    care of your veterans in Seattle. But I think most people do
    not realize it is a 3\1/2\ hour flight from Alaska to Seattle.
    It is a long way for those people to go. So I appreciate your
    concern.
        Mr. Secretary, thank you for you and your team being here
    today.
        I wanted to talk with you about an issue that is really
    weighing heavily on our veterans today and that is that they
    are coming home from serving us so honorably overseas and
    cannot find a job. The unemployment rate for our young veterans
    returning from Iraq and Afghanistan is now over 21 percent.
        When I was out in my State for the last 2 weeks, I sat down
    with a number of young veterans to talk to them about what was
    keeping them from finding work when they came home. And
    frankly, it was really shocking what a lot of them said to me.
    Some of them told me that they actually leave off the fact on
    their resume, when they are giving it to an employer, that they
    are a veteran. And I asked them why and they said it was
    because it went to the bottom of the stack. They did not know
    if it was because of the stigma of the invisible wounds of war,
    but they were finding that from many employers.
        Many of them told me that the Pentagon and VA transition
    programs do not work for the jobs and types of opportunities
    that could be available today.
        Many of them told me that they completely struggle to get
    civilian employers to understand what their experience was in
    the military that translates to what a civilian employer might
    need.
        They basically told me that their peer group either chose
    to get a job and had good experience or went to college or some
    kind of apprenticeship school and had that experience. They
    chose to go to the military and their experience does not count
    when they come home to get a job.
        I just find that completely unacceptable. I found that it
    often triggers a lot of mental and emotional issues that we are
    seeing among our veterans today as well. These people serve our
    country honorably. They are great workers. They are skilled.
    They come to work on time. They should not be facing these kind
    of barriers when they come home.
        So I wanted to ask you today, while you are here, if you
    are hearing the same kinds of concerns from our returning
    veterans and if there is anything the VA is doing today to try
    and make the transition work better.
        Secretary Shinseki. Thank you, Senator.
        I hear some of the same things, perhaps not the same
    anecdotes, but it feeds a couple of images I carry around and I
    tend to refer to them in speeches. This will take a few
    minutes, so I hope I do not take up too much time here.
        The first image is the one we are most familiar with. Every
    year about 60 percent of high school graduates go on to
    universities or some higher institution of learning. The
    remaining 40 percent go to vocational training or right into
    the workforce, and as you indicate, a very small percentage
    join the less than 1 percent of Americans serving in uniform
    doing the Nation's bidding. Good folks. They go through the
    train of experience, prepare for life with discipline and
    accountability. When they arrive in their first unit, good
    leadership puts them on missions that are complex, dangerous,
    sometimes near impossible. And yet, they outperform all our
    expectations. Great youngsters.
        The second image is a smaller population, but it says
    veterans are a disproportionate share of the Nation's homeless,
    jobless, mental health, depressed patients, substance abusers,
    and suicides.
        So the issue is what happened here. They are the same kids
    in both images. Something happened, and that is what we are
    about, is to try to figure this out, how to keep the kids in
    image one going on to do great things and then reach into image
    two and get those youngsters the help they need. That is what
    we are about.
        Senator, I would tell you that in all of our Departments of
    the Federal Government we have a goal of hiring veterans as
    part of the workforce. Right now, VA is at about 30 percent. It
    may be a point or two less. We intend to raise that. I am happy
    to serve as the Vice Chair to Secretary Solis who chairs the
    interagency task force on hiring veterans in the Federal
    Government. All of us are working toward this to try to
    increase the opportunities for them.
        At the VA, we have a Veterans First project which is better
    known. Small businesses are given the opportunity to compete
    for our contracts, and if competent, we level the playing field
    and they have a good shot at that.
        An example of this is last year in the stimulus funding, we
    were given $1 billion, lots of money for VA, and we competed 98
    percent of those dollars. As a result, our contracts came in
    lower than usual, and so we were able to have 20 percent more
    buying power.
        So just by the way we run these things, we feel good about
    the processes we have in place. In that process, 82 percent of
    our contracts went to veteran-owned small businesses, important
    for us because veterans hire other veterans. So that creates
    the churn of jobs, and we are looking for any opportunity we
    might have to repeat that.
        But I do share your concern. The G.I. bill is important
    because it gives some opportunity for youngsters to have
    constructive work for the next 4 years, but 4 years from now,
    they will be looking for jobs, and we need to have in place----
        Senator Murray. Well, I very much appreciate that response.
    I think there are a number of things we need to do. The TAPS
    program, National Guard, their skills and the way we treat them
    today cannot be the way we treated them 20 years ago.
        I am going to be introducing actually legislation next week
    on a veterans' employment legislation. I would love to have
    anybody join me on that that is interested. But looking at how
    we can help them transition their skills better so that
    civilian employees actually hear the skills that they have,
    opening up opportunities for apprenticeship programs that they
    currently do not have under the G.I. bill in an online school
    which often works for them, and helping them actually establish
    small businesses, not just have veterans on preference, but
    actually helping them do that. I think there are a number of
    things we have really got to aggressively work on so that as we
    are recruiting today and telling young people to come into the
    military, it is great experience, it is actually an experience
    that will help them get a job some day and they do not feel
    left behind.
        So, Mr. Chairman, I thank you for the extra time here.
        Mr. Secretary, I hope I get your help and support on my
    legislation as well. Thank you.
        Senator Johnson. Senator Collins.

                                VETERAN SUICIDES

        Senator Collins. Thank you, Mr. Chairman.
        Mr. Secretary, welcome. I was pleased to have an
    opportunity to talk with you recently in my office and to thank
    you for coming to the great State of Maine to tour our veterans
    hospital, which I would inform my colleagues is the oldest in
    the Nation, the very first veterans hospital.
        A recent article in Time magazine noted that between 2001
    and the summer of 2009, our military lost 761 soldiers in
    combat in Afghanistan. During that exact same period, the
    military lost more soldiers to suicide, 817 of our men and
    women in uniform. Last year, 160 active duty soldiers took
    their lives, and just this week the Army announced that in the
    first 3 months of this year, 71 more soldiers took their own
    lives.
        I know that this news is heartbreaking to you personally,
    as it is to all of the members of this subcommittee. I have
    talked with the active duty leaders in our military about what
    the Pentagon is doing to address the mental health needs of the
    active duty force, but I would like to know from you whether
    you feel the VA's budget is adequate to address the same kind
    of needs for mental health services and counseling that face so
    many of our returning veterans.
        Secretary Shinseki. Well, Senator, thank you very much for
    that question.
        We have resourced this properly, but there is so much more
    to be done in this area. First of all, none of us are experts
    in how to deal with the phenomena that results in great young
    people who do such wonderful things for us ending up feeling
    that there is no other choice but to have to take this step and
    hurt themselves.
        We have, in the last 4 years, hired probably an additional
    5,000 to 6,000 mental health staff to bolster our capabilities
    here in dealing with this issue. We probably number 20,000 or
    19,000 mental health staff today. We have made mental health
    part of our primary care facilities so that having someone
    think about having to go to the mental health clinic and the
    stigma associated with that is eliminated, especially amongst
    20-year-olds. We are trying to help them not have to deal with
    that. So we provide mental healthcare inside the primary care
    facility.
        We have created a suicide hotline that is well recognized
    nationally out of Canandaigua, New York. They handle probably
    10,000 calls each month and each day something on the order of
    10 rescues online of individuals who are under such great
    duress that they are thinking about hurting themselves. Over
    the several years since we have started this, we have had
    probably 3,000 intercessions that stop the act of self-
    destruction in progress while the phone call is being made.
    When the phone is picked up, it is a mental health professional
    on the line. It is not just an operator. There are two of them.
    They work in a pair, one of them speaking to the individual and
    getting as much information and the other is helping to try to
    locate the individual so we can get help there. So these are
    actual online rescues that are occurring.
        We advertise this hotline in most of the major cities in
    the country so that people have some understanding of this, at
    bus stops, on buses, on the metro.
        More work needs to be done in terms of research, and so we
    are putting some energy there as well.
        Let me turn to the Chief Medical Officer here, Dr. Petzel,
    and see if he has got anything to add to this.
        Dr. Petzel. Thank you, Mr. Secretary. That was really quite
    thorough. Just a couple of things, Senator, that I would add.
        One is that we have a suicide prevention team at every one
    of our facilities. These teams include experts in PTSD,
    substance abuse, and those other mental illnesses that are
    often associated with suicide.
        In addition to that, all of the veterans returning from
    combat who seek care with us are screened for traumatic brain
    injury, substance abuse, PTSD, and depression: again, those
    things which we often have associated with suicide. Any suicide
    death is a tragedy. Any suicide death is a tragedy.
        I think that we have the resources, as the Secretary
    pointed out, and the programs to have an impact on veterans'
    suicide. I would not want to say we can eliminate this, but I
    think we will be able to see the fact that we are having an
    impact.
        The Secretary mentioned at the end of his remarks,
    research. One of the things that we need, that the Nation needs
    to do is a better job of, is being able to identify those
    people who are really at risk. I mean, there is a suicide
    assessment that could be done, but it does not really hone in
    on those people who are very seriously at risk and I think we
    need to be at the forefront of doing that kind of research.
        Secretary Shinseki. May I just provide just some data here
    to answer your question, Senator? The 2011 budget request
    includes an 8.5 percent increase, or $400 million, over the
    2010 budget for mental healthcare, and then in terms of mental
    health research, the 2011 budget request is a 15 percent
    increase above the 2009. Eighty-three million dollars is the
    research number.

                                   G.I. BILL

        Senator Collins. Thank you. That is very encouraging.
        Mr. Chairman, I have another question that I would like to
    just submit for the record. It has to do--and the Secretary was
    the one who brought this to my attention, the fact that when we
    updated the G.I. bill to help provide more educational
    assistance, we narrowed the kind of training program that is
    available, and we left out a lot of vocational, community
    college kinds of programs. And that is something I think we
    need to take a second look at. So I have a couple of questions
    on that that, with your consent, I would like to submit for the
    record. Thank you, Mr. Chairman.
        Senator Johnson. It will be received.
        Senator Pryor.

                                  RURAL ACCESS

        Senator Pryor. Thank you, Mr. Chairman, and thank you, Mr.
    Secretary, for being here.
        I do want to echo Senator Collins' concerns about the
    suicide rates. I agree with what you have said, that any
    suicide is a tragedy. I know you are working on it. You are
    very attentive to it, and I would just encourage you to
    continue on that track and even put more resources there if
    that is what you need to do. But it is very important.
        Let me ask a question. I do not want this to sound like a
    parochial question because I am going to talk about Arkansas
    here for just a minute. I am sure every other State in the
    Union has these same type of concerns because even the most
    urban States have some type of rural area in them.
        But in our rural areas of my State, I hear from a lot of
    our veterans about the difficulties they have in accessing
    medical care that meets their needs. The VA outreach
    initiatives have been good in a lot of ways and there have been
    good attempts and steps in the right direction. I know you have
    the community-based outpatient clinic program. But have you
    done any sort of top-down review of the community-based
    outpatient programs and looking for ways that they can provide
    greater oversight and guidance so that the best possible care
    and access is available to these veterans who live in these
    rural areas? I know you mentioned some of the most rural areas
    in the country, Alaska, but our State has a lot of hard-to-
    access areas with not much healthcare in there.
        Secretary Shinseki. I am going to turn to Dr. Petzel in a
    second.
        Again, Senator, this is a great reminder. Several years
    ago, very bright people, well before my time, decided that
    having 153 premier flagship medical centers was not good
    enough, that there is so much expanse to our country that we
    had to find a different solution in delivering healthcare, not
    just welcoming people to come get it but delivering healthcare.
    So we created a community-based outpatient clinic system, which
    you have asked me whether or not we are taking a look at.
    Outreach clinics in places that do not have a veteran
    population to support a full-time clinic will go lease a piece
    of real estate, stand a clinic up for 3 days, shut it down, and
    move it, mobile, on wheels, and do the same thing.
        Telehealth, telemedicine. Right now, we have 40,000
    veterans who are receiving telehealth monitoring because they
    are chronically ill in their own homes. They do not have to go
    anywhere. The technology is there. So this is part of the
    structure.
        Yes, we are looking down to make sure that we have the
    right capabilities, the right services to meet the needs out
    there, and that is a constant look. There are looks underway
    right now. In fact, I would just offer to everyone that this is
    a look and we are trying to ensure that we have a good
    understanding where the needs are.
        With that, let me turn to Dr. Petzel.
        Dr. Petzel. Thank you, Mr. Secretary.
        Senator Pryor, I heard two questions or two concerns. Let
    me just add a little bit to the first one to what the Secretary
    had to say.
        Each year we assess the needs for community-based
    outpatient clinics. It starts at the medical center level,
    moves up through the network, and eventually we come to a
    national understanding of what the needs are for additional
    community-based outpatient clinics. We will be opening a number
    of new ones during 2010. We hope to have about 862 clinics
    opened with the completion of fiscal year 2010.
        But as the Secretary mentioned, there are much more mobile,
    if you will, modalities that we can use. Home-based primary
    care where we send visitors into the home. Telehome health
    where we actually have tools for monitoring in the home. A case
    manager, from the veterans' perspective, is probably the most
    desirable way to provide care in the rural community. They do
    not have to travel very frequently to a clinic or to a medical
    center. And then we have telemedicine where we can provide in
    the community telemedicine access to specialists at various
    places.
        I think we are going to be doing a better job in these next
    2 years of reaching rural America. I think the Secretary
    mentioned there are 40,000 patients on telehome health. I think
    that the number who need that modality is probably hundreds of
    thousands, and we are moving aggressively to increase the
    number using telehome health.
        The second question, though, that I thought I heard in what
    you said was, what about the quality of the care that we
    receive in our community-based outpatient clinics. And we do
    hold them to the same standards and do assess them in the same
    ways for the quality of care that they are receiving, and that
    is whether it is a clinic that we staff ourselves or whether it
    is a clinic where we contract for care.

                            ELECTRONIC HEALTH RECORD

        Senator Pryor. Great. I appreciate that and I appreciate
    your attention to that. It is important to pretty much every
    Senator in the Senate because we all have some rural areas and
    some challenges out in those rural areas.
        Mr. Secretary, I would like to ask you about the joint
    lifetime electronic record. I know that this is something that
    the DOD and the VA have been working on together. I think it is
    very important that we do it and do it right. Could you give us
    a very brief status report on that?
        Secretary Shinseki. Let me turn to the expert, Senator. Let
    me turn to Roger Baker here who handles that for us.
        Mr. Baker. Thank you, Mr. Secretary. I will give you a
    quick update. We have a lot of detail on this one.
        As you know, we have probably the best interoperability
    right now with the Department of Defense, exchanging
    information between our electronic health records. As we moved
    to expand that, we have moved to a national standard for
    information exchange so that we can bring the private sector
    into that electronic health record. Roughly 50 percent of the
    care provided to veterans is done by the private sector, and in
    the past we have not shared those health records. So we are
    moving that forward.
        We have had a pilot live in San Diego with Kaiser
    Permanente on that project for several months. We have
    announced that we will be doing another pilot in the Hampton
    Roads area and moving forward with pilots there toward a 2012
    general availability of that for private sector folks to hook
    in with.
        On the benefits side, we have also made substantial
    progress in achieving what the Secretary terms the ``seamless
    transition'' and doing things along the lines of putting all of
    our benefits information and the DOD's benefit information on a
    common Web site so that a service member goes to the e-benefits
    portal while they are in the service and sees what their
    benefits are. They have the same log-in, exactly the same Web
    site, when they move to VA so all the information is the same
    there.
        We really have moved a long ways forward in a global
    approach to sharing that information. It is a long process.
    There are a lot of systems involved and a lot of information
    involved, but we feel very good about the progress.
        Senator Pryor. Good.
        Thank you, Mr. Chairman.
        Senator Johnson. Senator Brownback.

                                 JOINT VENTURES

        Senator Brownback. Thank you, Mr. Chairman.
        Mr. Secretary, welcome, and gentlemen, good to have you
    here.
        I want to raise two quick issues with you. One is the joint
    VA/DOD ventures that you have around the country, Mr.
    Secretary. I understand you have eight joint ventures between
    DOD and the Veterans Administration as far as healthcare
    facilities that serve both active duty members and veterans.
        I just want to put out for you that at Leavenworth one of
    the things that I have been talking about with the local base
    and the Veterans Administration in Leavenworth is that as they
    look to move forward, I think there are some real synergies and
    possibilities of a joint facility in Leavenworth. You have a
    small VA hospital that is there. You have got a major Army
    base. We have the disciplinary barracks from the DOD also
    there. And then the Bureau of Prisons (BOP) has a major
    facility. And yet, no hospital healthcare facility for the
    entire complex.
        It is expensive care that is taking place now. The Bureau
    of Prisons is building a kidney care center for dialysis just
    for older people that are in prison. To get dialysis, they are
    going to move all their prisoners from around the country to
    Leavenworth to get dialysis care. Probably a good idea, but I
    am looking at this and thinking you have a VA, a major military
    base, disciplinary barracks, and BOP, and it is all the same
    Government and we are short of taxpayer money.
        I think this is a prime place to look at something of that
    nature, and I would just urge your folks to take a look at
    that. I know the base commander at Leavenworth would be
    interested in doing this because he does not have a healthcare
    facility at all, and it is a substantial base. I think it is
    the largest base in the country without a healthcare facility,
    and it would be nice to do this in the most economical way we
    could.
        A second issue I just want to raise with you--and Senator
    Collins raised it. It was on Senator Pryor's mind as well--is
    on the suicide, PTSD, traumatic brain injury issue. I think we
    are doing a lot better job this time around on this than after
    the Vietnam era. When I first came into Congress, I would see a
    number of Vietnam veterans come into our office that just had
    not--there was not any recognition that there was a PTSD
    syndrome at the time, and then they did not get any care and it
    just got worse for neglect. I think you are doing a better job
    this time around.
        One issue I would offer to you on that and I hope you do is
    to engage more of the private sector community on it,
    particularly the not-for-profit, faith-based community that
    would really like to engage because in my experience, these
    guys have difficulties that in many cases they are not willing
    to express or talk about or it is not tough if I do, and yet
    the longer it goes on, the worse it is going to dig in. And
    they need to really just build relationships. They need
    somebody that just sits there and says I care about you. Look,
    we have a problem and let us go get it taken care of.
        And I have seen some interesting models around the country
    of where the private sector is stepping in. There is a group
    that just came into my office--I think they are from Kentucky--
    that is working doing this--and this seemed to me to be really
    classically built for a private, faith-based community
    engagement because really what you need is somebody to build a
    relationship that can see the signs coming on this. And many of
    these guys either do not have that level of relationship or
    have already blown through their relationships, their close
    ones, because of PTSD or traumatic brain injury and then the
    steps on down the road are drugs or alcohol or suicide at the
    worst case. This one seemed to me to be really made for that
    sort of issue because you are going to need a lot of hands on
    deck to pick these sort of problems up as they come along.
        I would urge you to look at that and I would hope you could
    look at this possible joint facility at Leavenworth.
        Secretary Shinseki. Senator, I am going to turn to the
    Chief Medical Officer here for his insights.
        But I would tell you we look for any opportunity to
    partner, especially with DOD. Very little of what we do in VA
    originates here. We are joined by the one key link between us
    and that is the individual who wears a uniform one day and
    takes the uniform off the next. And the VA then has
    responsibility to care for them for a long period of time.
        You may be interested to know that today we still have two
    children of Civil War veterans on our rolls as beneficiaries.
        Senator Brownback. Is that right?
        Secretary Shinseki. One hundred and fifty-one Spanish-
    American War beneficiaries. So our responsibilities go on for a
    long time, and this effort to partner with DOD makes good
    sense, makes good business sense, and it takes great care of
    these youngsters.
        Let me just turn to Dr. Petzel here for a few seconds.
        Dr. Petzel. Just to elaborate a bit on the Secretary's
    comment--thank you, Mr. Secretary. In Kansas, we are actually
    engaged already with Leavenworth. The VHA leadership has been
    in discussions with the Leavenworth military community about
    how we can cooperate.
        Senator Brownback. Good.
        Dr. Petzel. I think that is an excellent suggestion,
    Senator.
        Senator Brownback. I have been pushing them to do this. It
    really makes a lot of sense to do it.
        Dr. Petzel. We are actually also looking at another place
    in Kansas, in Wichita at McConnell Air Force Base. We have
    engaged McConnell in discussions about how we can share
    jointly. We are one Federal Government and there ought to be
    ways that we can share our expenses.
        Senator Brownback. This would be unusual, but if you could
    even think about involving the disciplinary barracks which is
    part of the military that is in Leavenworth and the BOP. I know
    that is really outside of the box, and we may be pushing it to
    get two stovepipes together, and three or four may be just a
    bridge too far. But they are all within 3 miles of each other--
    4. And you would impress a lot of people if you are able to get
    that many stovepipes in the same chimney.
        Dr. Petzel. We will certainly look into that.
        Senator Brownback. Thank you.
        Secretary Shinseki. Senator, I will just add to this. Forty
    thousand veterans come out of prisons every year, and so out of
    our medical care system--out of VA for both benefits and
    healthcare, we have already been in touch with prisons. I think
    there are something on the order of 1,300 Federal prisons. We
    have visited maybe 800 of them and made contact with about
    15,000 prisoners in the effort to prepare them so they leave to
    be on track with a good phase in the next phase of their lives.
    Much of that has to do with treatment to begin with and then
    stability in jobs and other things. But already there is this
    requirement to work together with the Bureau of Prisons.
        Senator Brownback. Good.
        Thank you, Chairman.
        Senator Johnson. Thank you, Senator Brownback.
        I would like to thank the Secretary and those accompanying
    him for appearing before this subcommittee. I look forward to
    working with you this year.

                         ADDITIONAL COMMITTEE QUESTIONS

        For the information of members, questions for the record
    should be submitted to the subcommittee staff by close of
    business on April 21.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                   Questions Submitted by Senator Tim Johnson

        Question. Mr. Secretary, on March 18, the VA published a Proposed
    Rule in the Federal Register that would establish a presumption of
    service connection for nine diseases for veterans who served in the
    Persian Gulf and Afghanistan. I am pleased that the VA is taking steps
    to recognize diseases that afflict vets that served in the Gulf. As the
    VA moves to implement this proposed rule, have you developed any budget
    estimates, both for compensation payments and healthcare costs, for the
    cost of implementing this new policy?
        Answer. The compensation benefit costs associated with this
    proposed rule are estimated to be $1.5 million during the first year,
    $11.5 million for 5 years, and $36.4 million over 10 years. This
    proposal would amend section 3.317 of title 38 C.F.R. to establish a
    presumption of service connection for the nine diseases (brucellosis
    infection, campylobacter jejuni infection, coxiella burnetti infection,
    malaria infection, mycobacterium tuberculosis infection, nontyphoid
    salmonella infection, shigella infection, viseceral leishmaniasis and
    west nile virus infection). However, the costs associated with this
    regulation are based only on compensation for tuberculosis due to
    insufficient data available on the other rare diseases. Because of the
    small number of veterans and survivors affected by this rule annually,
    the additional caseload and cost of implementing this new rule will be
    absorbed in existing resources.
        Question. Collaboration between the VA and the Indian Health
    Service needs to improve. Many Native Americans who are veterans often
    get conflicting information regarding benefits that they are entitled
    to. What plans does the VA have to improve the coordination of benefits
    between the two Departments?
        Answer. VA has a robust program with the Indian Health Service
    (IHS) as is reflected in Attachment A, which provides details regarding
    specific Native American/Alaska Native veteran outreach and healthcare
    activities.
        In addition, on May 24, 2010, VA Secretary Shinseki met with Dr.
    Yvette Roubideaux, Director of Indian Health Service. During this
    meeting, it was agreed the Memorandum of Understanding between VA/IHS
    would be updated by September 30, 2010, to reflect the expansion of
    collaborative activities, as well as the enhancement of communications.
    Both organizations agreed that working together in partnership will
    enhance the delivery of benefits to our Native American and Alaska
    Native veterans.
        Question. Mr. Secretary, the budget includes a supplemental request
    to implement the Agent Orange decision. The entire request is for VBA
    disability claims. However, this decision is likely to have an
    important impact on demand for VHA medical care as well. Has VHA
    projected the likely effects on its medical expenditures?
        Answer. VHA projects Agent Orange expenditures of $165 million and
    $171 million in fiscal year 2011 and 2012, respectively. These costs
    are included in the budget request.
        Question. The denial of On-the-Job Training (OJT) benefits under
    the GI Bill for the State workers who work in State Veterans Affairs'
    State Approving Agencies (SAA) is inconsistent with the policy
    regarding Federal VA workers and OJT. There have been several incidents
    where the VA has denied OJT programs with the South Dakota SAA. The VA
    has deemed employees to be ``fully qualified'' due to the fact that
    they were hired to their positions, but being fully qualified is not
    the same as being fully trained. VA employees, such as a VA Veterans
    Claims Representative, or an Education Liaison Representative can use
    their GI Bill benefits for an OJT program with the VA, but those in
    State Approving Agencies are denied approval to use their GI Bill
    benefits for OJT Programs. The VA's argument for denying the claims of
    SAA employees is that they don't need training because they are already
    qualified, and yet, the VA employees who are in positions of authority
    over the SAA employees are generally approved to use OJT benefits.
        Why does the VA deny the use of the GI Bill for OJT programs for
    SAA employees while approving them for the education liaison
    representatives (and others) who would generally be considered more
    qualified, trained, and knowledgeable?
        Answer. SAAs are charged with approving education courses in
    accordance with the provisions of chapters 33, 34, 35 and 36 of title
    38 U.S.C. Under contracts with VA, SAAs ensure that education and
    training programs meet Federal VA standards through a variety of
    approval activities, such as evaluating course quality, assessing
    school financial stability, and monitoring student progress. SAAs also
    promote the development of apprenticeship and on-the-job training
    programs and approve tests used for licensing and certification. The
    Federal Acquisition Regulations (FAR) require SAAs to be qualified to
    perform the required duties before they can be awarded a contract.
    Therefore, VA has denied the requests of current SAA employees for on-
    the-job training programs.
        VA's General Counsel is currently reviewing the law and regulation
    as it applies to this matter and will issue a formal opinion by mid-
    July 2010.
        The Veterans Benefits Administration does hire employees in entry-
    level trainee positions. Work completed by trainees is reviewed and
    approved by experienced supervisors. These supervisors are required to
    have the necessary knowledge and skills to perform the duties of the
    job prior to being selected for the position, much like the
    requirements for SAAs. Therefore, they would not be approved for an on-
    the-job training program.
                                     ______

                Questions Submitted by Senator Daniel K. Inouye

        Question. Mr. Secretary, it is my understanding that the Department
    of Veterans Affairs has done an extremely good job when it comes to
    both hiring veterans, and utilizing service-disabled veterans small
    businesses to execute contracts. Would you please elaborate on some of
    the goals that VA would like to meet with regard to both hiring and
    small businesses in fiscal year 2011?
        Answer. The average employment of veterans across the Federal
    workforce is 25.8 percent according to OPM, as of September 30, 2009.
    Today, approximately 30 percent of the Department of Veterans Affairs
    workforce (over 90,000 of 300,000 employees) is comprised of veterans.
    We've set a strategic target of 35 percent veteran employment. Our
    target for fiscal year 2011 is to obtain 31 percent veteran employment.
        VA is proud to lead the Federal Government in small business
    contracts to service-disabled and other veteran-owned small businesses.
    Preliminary VA data for fiscal year 2009 indicate that service-disabled
    and other veteran-owned small business interests respectively received
    16.3 percent and 19.3 percent of VA's total procurement dollars. We are
    on a similar performance track to exceed our goals in fiscal year 2010.
    Our employees worked especially hard to exceed these ambitious goals
    for implementing ARRA funds. Of the over $1 billion in ARRA funding for
    VA approximately 80 percent have so far been awarded to Veteran Owned
    Small Businesses (VOSB). Our goal for fiscal year 2011 for service-
    disabled VSOB is 10 percent, and for VSOB is 12 percent.
        Question. Mr. Secretary, there are many pressing issues that face
    our veterans, and the fiscal year 2011 VA budget was crafted to seek
    the greatest degree of balance. The VA is the agency charged with
    caring for the needs of our veterans for the long-term. As you looking
    forward and anticipate the greater demands that will fall upon VA, in
    terms of healthcare and benefits, what actions are you taking to
    prepare the Department for the expected influx? Given the constraints
    we are all facing during these economically difficult times, how do you
    see the Department meeting the requirements this preparation requires?
        Answer. We recently completed development of a new strategic
    framework that is people-centric, results-driven, and forward-looking.
    The path we will follow to achieve the President's vision for VA will
    be presented in our new strategic plan, which is currently in the final
    stages of review. The strategic goals we have established in our plan
    are designed to produce better outcomes for all generations of
    veterans:
      --Improve the quality and accessibility of healthcare, benefits, and
            memorial services while optimizing value;
      --Increase veteran client satisfaction with health, education,
            training, counseling, financial, and burial benefits and
            services;
      --Protect people and assets continuously and in time of crisis; and
      --Improve internal customer satisfaction with management systems and
            support services to achieve mission performance and make VA an
            employer of choice by investing in human capital.
        VA's 2011 budget focuses on three concerns that are of critical
    importance to our veterans--easier access to benefits and services;
    reducing the disability claims backlog and the time veterans wait
    before receiving earned benefits; and ending the downward spiral that
    results in veterans' homelessness.
        This budget provides the resources required to enhance access in
    our healthcare system and our national cemeteries. We will expand
    access to healthcare through the activations of new or improved
    facilities, by expanding healthcare eligibility to more veterans, and
    by making greater investments in telehealth. Access to our national
    cemeteries will be increased through new burial policies that lower the
    veteran population threshold required to build a national cemetery from
    170,000 to 80,000 within a 75-mile radius and that allow for the
    establishment of urban satellite cemeteries.
        We are also requesting a substantial investment for our
    homelessness programs as part of our plan to ultimately eliminate
    veterans' homelessness through an aggressive approach that includes
    housing, education, jobs, and healthcare.
        The Veterans Benefits Administration now employs more than 11,600
    full-time claims processors and plans to add 3,000 additional
    decisionmakers in fiscal year 2011. However, continuing to increase the
    size of our workforce is neither a long-term nor scalable solution; we
    need to do a much better job of leveraging network automation and
    software productivity tools to more effectively manage our workload and
    serve our clients. Bold and comprehensive changes are needed to
    transform VA into a high-performing 21st century organization that
    provides high quality services to our Nation's veterans and their
    families.
        VA's transformation strategy leverages the power of 21st century
    technologies applied to redesigned business processes. Pilot programs
    are underway at four of our regional offices to support our business
    transformation plan to reduce the claims backlog, improve service
    delivery, and increase efficiencies. Each pilot functions as a building
    block to the development of an efficient and flexible paperless claims
    process. The results of all four pilots will be incorporated into the
    nationwide deployment of the Veterans Benefits Management System (VBMS)
    in 2012. VBMS will be built upon a service-oriented architecture,
    enabling electronic claims processing by providing a shared set of
    service components derived from business functions. Initially, VBMS
    will focus on scanned documents to facilitate the transition to a
    paperless process. Ultimately, it will provide end-to-end electronic
    claims workflow and data storage.
        VA is also seeking contractor support to develop a system to
    support evidentiary assembly and case development of the new Agent
    Orange presumptive claims. The system will enable veterans to
    proactively assist in the development of their claims through a series
    of guided questions and will automate many development functions such
    as Veterans Claims Assistance Act notification and follow up.
        In addition to an electronic claims processing system, VA is
    committed to improving the speed, accuracy, and efficiency with which
    information is exchanged between veterans and VA, regardless of the
    communications method. The Veterans Relationship Management Program
    (VRM) will provide the capabilities to achieve on-demand access to
    comprehensive VA services and benefits in a consistent, user-centric
    manner to enhance veterans', their families' and their agents' self-
    service experience.
        In summary, VA will be successful in resolving these three concerns
    by maintaining a clear focus on developing innovative business
    processes and delivery systems that will not only serve veterans and
    their families for many years to come, but will also dramatically
    improve the efficiency of our operations by better controlling long-
    term costs. By making appropriate investments today, we can ensure
    higher value and better outcomes for our veterans.
        Question. Mr. Secretary, would you please discuss some of VA's
    long-term plans to meet the healthcare needs of our veterans that live
    in remote areas? For example, the State of Hawaii is home to many brave
    men and women that have served this country in uniform. Remote and
    rural areas in the State as well as the territories in the Pacific
    create unique demands on the VA's system. There has been discussion of
    allowing existing Federal healthcare providers in the area to provide
    care for veterans. Could you please elaborate on the plans to address
    these unique needs through partnerships, telehealth, or other
    initiatives, and how these goals may be met through the VA's budget?
        Answer. It is VA's intention to continue aggressively pursuing a
    strategy designed to reach veterans in remote areas, no matter where
    they live. Veterans Integrated Service Network (VISN) and local
    facility leadership are also exploring opportunities to extend the
    reach of VA's benefits into more remote areas. As a result, a
    comprehensive strategy for addressing the needs of rural and highly
    rural veterans, including those in the Hawaiian and other Pacific
    Islands, is based on the establishment of community-based outpatient
    clinics, rural health outreach clinics, telehealth and telemental
    health initiatives, as well as partnering with other Federal, State and
    local healthcare providers.
        In Hawaii, VA closely partners with the Department of Defense and
    is exploring opportunities to partner with Papa Ola Lokahi, a non-
    profit organization which addresses native Hawaiian healthcare needs,
    and other healthcare systems and practitioners located in the Islands.
    This partnership is seeking to improve the availability of and access
    to VA enrollment materials for Native Hawaiian veterans, and is
    considering the potential use of Native Hawaiian Clinics where veterans
    can access traditional and complementary medical care, where feasible.
                                     ______

                Questions Submitted by Senator Mary L. Landrieu

        Question. General Shinseki, as you are aware, VA is in the process
    of improving its human capital capabilities through the Human Capital
    Investment Plan and Human Resources Lines of Business initiative. These
    are important efforts and I applaud VA's efforts to both improve its
    efficiency and look after its people. With respect to the HR Line of
    Business initiative, there are a number of Federal shared service
    centers capable of providing these services, one of which is located in
    East New Orleans at USDA's National Finance Center. In February, I
    wrote you asking that you consider the merits of utilizing NFC for your
    department's line-of-business needs. Utilizing a Federal agency like
    the National Finance Center would allow VA to avoid a lengthy and
    costly procurement process--and there are certainly other benefits.
        I would be interested to know where VA is in the process of
    selecting a line-of-business provider, and whether your staff has met
    with NFC personnel to discuss this matter.
        Answer. VA has been working with the Office of Personnel Management
    and other Executive Branch Departments and agencies on the overall
    Human Resources Line of Business Initiative. Using our current
    selection process guidelines, VA will consider NFC as our human
    resources services provider along with all interested and approved
    providers.
        NFC will be afforded the full opportunity to demonstrate to key
    members of my staff the full range of products and services they desire
    to provide VA in this regard, and we will look forward to that process.
        Question. I would also like to ask about an issue that I am sure is
    very much on your mind--the implementation of the Post 9/11 GI Bill.
    There has been a great deal of effort to make sure this goes as
    smoothly as possible--a difficult task under the best of circumstances,
    but made all the more difficult given the complexity of the law and the
    short amount of time to get the system up and running. And indeed,
    there have been delays and backlogs that have frustrated veterans, but
    I know the VA is moving aggressively to address these issues.
        A significant amount of the work to develop the long term solution
    for the Post 9/11 GI Bill is being done by SPAWAR in New Orleans. It
    seems to me that given the concentration of subject matter expertise in
    both the implementation of the law and development of the supporting IT
    system, VA would be wise to examine an ongoing relationship between VA
    and SPAWAR with respect to GI Bill benefits.
        Once the planned releases of the Long Term Solution (LTS) system
    are complete, what are VA's plans with respect to the LTS system?
        Answer. As of today, VA intends to continue to house the Long Term
    Solution at the Terremark Data Center in Culpepper, Virginia. No
    decision has been made to date on whether or when to transition LTS
    back into a VA data center.
        Question. It is my understanding correct that the system will be
    housed at a VA data center and that claims will be processed in
    regional centers? Given the complexity of this undertaking, would it
    not be wise to examine a centralized processing center to handle claims
    and eliminate any existing backlog?
        Answer. All VA education benefit claims are currently processed at
    one of four Regional Processing Offices (RPOs) nationwide using systems
    housed in various locations throughout the country. VA has substantial
    experience in processing claims through off-site systems and is
    prepared to continue this procedure for the Long Term Solution (LTS).
    The creation of a centralized processing center would add complexity to
    the process by requiring that VA build out a centralized location,
    transition all relevant IT systems to this center, and relocate the
    trained claims processing staff currently spread throughout the four
    RPOs. VA has developed staffing and IT strategies to address any
    backlog of education claims that may occur and is confident that these
    strategies will be sufficient to achieve timely processing and payment
    of claims.
        Lastly, the LTS will both reduce the number of people needed to
    process claims and allow VA to move work electronically to available
    resources. Therefore, once VA gains experience with the new claims
    processing system, a review of the best model for claims processing
    locations will routinely occur as we maintain the best efficiency in
    our system while accounting for workload and available resources.
        Question. Will VA consider a Project Labor Agreement for the
    construction of the New Orleans VA Hospital?
        Answer. The Executive Order which relates to Project Labor
    Agreements encourages Federal agencies to consider the use of a PLA on
    construction projects valued at greater than $25 million. The final
    change to the Federal Acquisition Regulation was recently issued. The
    Department is finalizing an acquisition instruction letter that will
    establish policy on evaluating the use of PLAs for projects over $25
    million, including New Orleans. This will include evaluating factors
    such as the positive or negative impacts of a PLA on project cost,
    schedule, labor availability, competition, and labor unrest. The
    developed business cases and final decisions will become part of the
    contract file.
        Question. Where is VA in its decision for VA/DOD centers of
    excellence for blind veterans?
        Answer. VA is assisting the Department of Defense (DOD) in
    establishing the Vision Center of Excellence (VCE). VA is responsible
    for providing staff support for the VCE based on a Joint DOD/VA
    Memorandum of Understanding signed on October 16, 2009. VA has
    successfully recruited a Deputy Director, Chief of Staff, and Vision
    Rehabilitation Specialist. A Research Optometrist and Administrative
    Assistant are in the selection process and the Biostatistician position
    will be released for recruitment before the end of the 3rd Quarter of
    fiscal year 2010. VA personnel are currently occupying DOD space in
    Falls Church, VA.
        DOD has the lead on developing the Joint Defense and Veterans Eye
    Injury and Vision Registry (DVEIVR) to provide capability for analyzing
    longitudinal outcomes, assessing intervention strategies, enhancing
    performance improvement, and developing a common user/provider
    interface across DOD and VA. VA provided $1.7 million for use in
    developing a data store to capture information to populate the DVEIVR.
    Initial testing for VA's data store was completed in March 2010. VA
    estimates that by the end of the first quarter of fiscal year 2011, it
    will begin data abstraction efforts for the VA functional data store.
    Data abstractors will take clinical information from medical records
    and enter it into a computable database for analysis to improve medical
    care and conduct research. Development of the DVEIVR is projected to
    begin in the first quarter of fiscal year 2011.
                                     ______

                 Questions Submitted by Senator Robert C. Byrd

        Question. Secretary Shinseki, Congress has continued to fund
    Department of Defense and the Department of Veterans Affairs' efforts
    to integrate record keeping for over two and a half decades. As a
    result of departmental failures in both agencies, wounded soldiers
    often languish between the systems and receive inadequate care. Last
    April, President Obama joined you and Secretary Gates in announcing a
    combined DOD-VA electronic health record system development effort.
    Since that announcement over a year ago, what concrete progress has
    been made towards making the system a reality? What role have you
    played in accomplishing this goal? What are the milestones and
    timelines for completion of this effort? What will the system look like
    when completed? Will it be one seamless system, an integrated system,
    or an interoperable system?
        Answer. The Department is fully committed to meeting the needs of
    our service members and veterans, especially those who have given so
    much for their country. The Virtual Lifetime Electronic Record (VLER)
    is one of VA's highest priorities. VA's dedicated VLER team quickly
    explored new opportunities for exchanges of health information between
    not only VA and the Department of Defense (DOD), but also with private
    healthcare providers who also care for our veterans. The information
    obtained from this group is critical to the Department's efforts to
    ensure a complete treatment record is available. VA and DOD capitalized
    on the work being done by the Department of Health and Human Services
    to create the Nationwide Health Information Network (NHIN). VA
    conducted a proof of concept in September 2009 by exchanging very
    limited information over the NHIN on two patients who consented to be a
    part of this exchange. The test was conducted in San Diego, California,
    with two veterans who were seen by both the VA Medical Center and by
    Kaiser Permanente (KP). After the test, VA completed more work to be
    able to begin exchanging a limited set of health data for approximately
    400 veterans who have consented to be part of a production pilot in San
    Diego between the VA and KP. That effort commenced mid-December 2009
    and continues today. VA plans a second pilot in the Virginia Tidewater
    area that is expected to go into production during the summer of this
    year. Following the guidelines of the Chief Information Officer's
    Program Manager Accountability System (PMAS), development and
    deployment of additional health data elements and additional
    functionalities will occur in 6-month phases.
        However, as VLER builds upon this health data exchange, the VA's
    Enterprise Program Management Office (EPMO), which was established to
    oversee the efforts of both the health and benefits lines of business
    teams and coordinate those requirements with the information technology
    development teams, will begin exploring additional means of creating
    the framework for information interoperability necessary for all of
    VA's service providers to seamlessly have secure access to the
    information needed. This data liquidity will significantly reduce the
    burden on service members and veterans to repeatedly provide
    information that should and will be made available to our service
    providers.
        The next step in this approach will be to engage in discussions
    throughout VA and with the Social Security Administration (SSA) to
    identify those health data elements required for a disability claim
    that can be exchanged via the NHIN, and to determine the remaining data
    elements and design the framework for those exchanges. This approach
    will build on the lessons learned from the NHIN work and rely on HHS
    standards and protocols where applicable for health data exchanges.
        The approach VA is taking leverages the work being done by HHS and
    allows exchange of health data information over the NHIN. Utilizing the
    NHIN by creating an adapter from each Electronic Health Record (EHR) to
    the NHIN gateway allows each Department to modernize on their own
    schedule and meet their individual needs but still share health
    information.
        The VA's approach to VLER will accomplish the following:
      --Create the data liquidity required for service providers to access
            and use the information needed;
      --Reduce the burden on the service member and veteran of repeatedly
            providing information;
      --Deliver new functionalities and capabilities every 6 months, to the
            NIHN adapter for information interoperability; and
      --Position the Department to have laid the framework for the lifetime
            electronic record by 2012.
        Question. Secretary Shinseki, many wounded, disabled, and homeless
    veterans live in rural areas. Conversely, Department of Veterans'
    Affairs facilities tend to be aggregated in more densely populated
    areas to achieve maximum efficiencies. Southern West Virginia disabled
    veterans often have to travel to facilities as far away as Richmond,
    Virginia, to receive certain types of medical care. For some services,
    these veterans may have to travel 6-8 hours each way in order to
    receive care. For homeless veterans living in these areas, services are
    often completely unavailable. Last year, I asked what could be done to
    accommodate some of these services closer to home. What new initiatives
    have been undertaken since then, in West Virginia and nationwide, to
    accommodate some of these services closer to rural veterans?
        Answer. A significant number of initiatives have been developed and
    are providing services to veterans in remote areas, including West
    Virginia. Partnering with local community providers, community and
    outreach clinics, and telehealth initiatives are all methods VA is
    utilizing to provide care closer to the veterans' home. Attachment B
    provides details on a variety of programs that benefit all veterans who
    reside in the Appalachian region.
        Question. Secretary Shinseki, many VA community-based treatment
    centers are being collocated with large VA hospitals. These hospitals,
    in turn, are near large community or general hospitals. In part, this
    is because collocation affords cost-savings and staff-sharing
    relationships. Unfortunately, community-based centers are most needed
    in underserved areas where VA hospitals are far away. What are some of
    your thoughts on how we can best serve veterans living in these rural
    areas and what have you done to accomplish this in the last year?
        Answer. VA has long recognized that veterans who reside in more
    remote communities or geographic areas require the same level of
    services and healthcare as those living in more accessible areas.
    Providing care away from a VA medical center is a concept that VA began
    using in the early 1990s. Initially, community-based outpatient clinics
    (CBOCs) were located in areas with large concentrations of veterans and
    were reasonably accessible to a VA medical center or community
    hospital. As the number of CBOCs has increased and technology has
    improved, VA has recognized that veterans who reside in more remote
    communities or geographic areas require the same level of services and
    healthcare as those living in more accessible areas. As a result, in
    fiscal year 2008, the Office of Rural Health (ORH) funded the
    establishment of 10 part-time outreach clinics and 4 rural mobile
    healthcare clinics to target areas where there is not sufficient demand
    (or it is not feasible) to establish a full-time CBOC. These clinics
    extend access to primary care, case management and mental health
    services to rural veterans.
        Building upon these initiatives, an additional 30 rural outreach
    clinics and 51 CBOCs were approved in fiscal year 2009 and fiscal year
    2010, respectively. The primary requirement in determining the location
    of the outreach clinics was based on drive time and percentage of rural
    and highly rural veterans who receive care.
        In addition to the establishment of CBOCs and outreach clinics, a
    number of telehealth and Home-Based Primary Care (HBPC) teams have been
    activated.
        In fiscal year 2009, VA allocated $80 million for telehealth,
    augmented by an additional $67 million in fiscal year 2010 for a total
    of $147 million. Telehealth care is now provided from 144 VA medical
    centers to 500 other sites of care and supports care to more than
    260,000 veterans.
        The outcomes of this funding through the end of September 2009,
    when compared to the September 2008 baseline, has shown an 18 percent
    growth in the average daily census of rural and highly rural veteran
    patients receiving care in their homes via care coordination home
    telehealth (CCHT); a 41 percent growth in the number of clinical video
    telehealth (CTV) visits provided to rural and highly rural veteran
    patients; and a 77 percent increase in the number of care coordination
    store-and-forward telehealth (CCSF) visits provided to rural and highly
    rural veteran patients.
        The fiscal year 2010 initiatives are also showing positive growth
    over the prior year achievements by increasing access to care for
    veterans who reside in rural/highly rural area and who use telehealth
    care.
        Question. Secretary Shinseki, with an aging Vietnam veteran
    population, my office is receiving an increasing number of complaints
    about the lack of adequate VA nursing home and extended care facilities
    for veterans in West Virginia. Many facilities scheduled for
    construction years ago have experienced repeated delays. Last year, I
    asked you to look into this and get back to me on what we can do to
    accelerate and increase the construction of these facilities. Has
    anything been done to accelerate the construction of nursing home
    facilities during the last year and when can we expect to see
    additional Administration efforts in this area?
        Answer. The Beckley VA medical center submitted a 90-bed Community
    Living Center (CLC) Major Construction project application that ranked
    50 out of 61 in the fiscal year 2011 budget consideration. Projects
    ranking higher in priority focused on several sub-criteria, such as
    special emphasis, safety or seismic deficiencies. However, this project
    only supported the access sub-criteria; therefore, it ranked in the
    lower echelon.
        VA CLCs offer modern nursing home care units focusing on a home-
    like environment to foster healing. These are primarily constructed in
    pods of 10-12 home-like units. Due to this new concept, the current CLC
    design offers a unique opportunity to construct pods within the Minor
    Construction threshold. In the fiscal year 2010 Minor Construction
    program, for example, VA started approximately $261.3 million worth of
    design or construction projects across the country. VA will analyze the
    opportunities for Beckley's CLC to use an approach that considers Minor
    Construction while continuing to evaluate the project under Major
    Construction.
        Question. The Conference Report associated with the fiscal year
    2010 Military Construction, VA and Related Agencies Appropriations Act
    encouraged the VA to expand its partnership with accredited nonprofit
    service dog organizations where veterans with PTSD help to train
    service dogs. What is the current status of this effort, and to what
    degree has the Department of Veterans Affairs expanded its partnership
    with accredited nonprofit service dog organizations where veterans with
    PTSD help to train service dogs?
        Answer. VA has developed an excellent working relationship with
    nationally recognized organizations in the service dog community. VA
    has provided information to these organizations to assist with veteran
    education about the benefits of service dogs, and the veterans they
    interact with are provided an invitation to contact VA with questions.
    VA is partnering with the certification agency, Assistance Dogs
    International, Inc., for assistance with the development of educational
    materials for our veterans and clinicians, including a brochure and a
    video.
        VA Rehabilitation Service has a pilot program at the Palo Alto
    Veterans Healthcare System (Menlo Park Division) called the ``Paws for
    Purple Hearts Service Dog Training Program,'' which began in July 2008.
    VA has found that patients with PTSD assigned to the Men and Women's
    Trauma Recovery Program have benefited from this program. These
    patients are training dogs to become service dogs for persons with
    mobility impairments. Under this program, the service dogs are the
    property of the Assistance Dog Institute, with the Bergin University of
    Canine Studies, and return there for placement after the dogs are
    trained. The program has made the following clinical observations,
    finding that participants who train service dogs for mobility
    impairment have, on average:
      --Increased patience, impulse control, and emotional regulation;
      --Improved ability to display affection with less emotional numbness;
      --Increased positive social interactions and reduced isolation;
      --Improved sleep patterns and decreased use of pain medication;
      --Decreased number of startled responses and lowered stress levels;
            and
      --Improved parenting skills and family dynamics.
        The pilot program is ongoing. Its outcomes and the demand for its
    services will continue to be assessed to determine if expansion of the
    program to other VA medical centers is warranted.
        Question. Secretary Shinseki, the Department of Veterans Affairs
    receives funding for research. Historically, this funding has been
    restricted by the Department to research performed by, or in
    conjunction with, VA researchers. This practice has sometimes resulted
    in policy-based rather than science-based research. The VA's own Gulf
    War Veterans Illness Research Advisory Committee has been forced to
    approach Congress directly, year after year, to get funding for
    independent peer-reviewed scientific research. Last year, we had some
    indications that the Administration would request this independent
    research funding in the fiscal year 2011 budget request; however, it
    did not. This research has been funded through the Department of
    Defense, and again in fiscal year 2011, Congress will have to directly
    provide these funds. Some of this research has been groundbreaking and
    very productive. Last year, I asked you what could be done to bring
    this type of research back into the VA budget process. What has been
    done in this regard since our last meeting, and when will the VA's own
    Gulf War Research Advisory Committee be able to say that they no longer
    need Congressional assistance to fund the best and brightest proposals
    and scientists to conduct research into the causes and treatments for
    gulf war related illnesses?
        Answer. VA's plans for its gulf war research portfolio include a
    multi-pronged approach that balances the urgency of understanding and
    finding new diagnostic tests and treatments for ill veterans of the
    1990-1991 gulf war (short-term) with the need to do new studies on a
    national group of gulf war veterans (long-term). VA's goal is to
    maintain funding levels for gulf war research as close as possible to
    $15 million per year.
        VA's Office of Research and Development (ORD) issued three new
    requests for applications (RFA) specific to gulf war veterans research
    on November 10, 2009. RFA CX-09-013 is specifically aimed at
    identifying potential new treatments (clinical trials, including
    complementary medicine approaches) for ill gulf war veterans. RFA CX-
    09-014 and BX-09-014 are aimed at increasing our understanding of gulf
    war veterans' illnesses and identifying new diagnostic markers of
    disease and potential therapeutic targets to develop new therapies. The
    lists of topics of interest in CX-09-014 and BX-09-014 incorporate over
    80 percent of the research recommendations contained in the 2008 report
    from the VA Research Advisory Committee on Gulf War Veterans' Illnesses
    (RAC) and direct RAC input to ORD. The three RFAs described above will
    be re-issued twice a year to regularly request submission of new
    proposals and revisions of previously reviewed, but unfunded,
    applications.
        ORD's long-term plans include the design and implementation of a
    new study of a national group of gulf war veterans under the auspices
    of the VA Cooperative Studies Program, which has extensive experience
    in developing multi-site VA clinical trials and clinical studies. The
    design of this new study will include a Genome Wide Association Study
    (GWAS) and other elements, based on evaluating the existing body of
    scientific and clinical knowledge about the illnesses affecting gulf
    war veterans and recommendations received from the RAC. VA has targeted
    September 2010 for completion of the study design and implementation.
    This study was discussed with the RAC at their November 2-3, 2009,
    meeting to gather input on what additional elements could be included
    in the study. A planning committee has been established to define the
    elements to be included in the final study.
        The expiring authority found at 38 U.S.C.  1117(c)(2) will not
    result in the loss of compensation benefits or medical care for gulf
    war veterans currently receiving benefits for disabilities that are
    categorized as ``undiagnosed illnesses'' and for which service
    connection has been properly decided. Those veterans will continue to
    receive benefits after the date of the expiring authority on September
    30, 2011.
        Question. Secretary Shinseki, the Persian Gulf War Veterans Act of
    1998, passed as part of the fiscal year 1999 Omnibus Appropriations Act
    (Public Law 105-277), is scheduled to expire this year, 10 years after
    the last day of the fiscal year in which the National Academy of
    Sciences submitted its first report. Will any veterans lose priority
    care or benefits as a result of the expiration of the law, such as
    those who remain classified as having an ``undiagnosed illness,'' and
    will Congress have to pass additional legislation to ensure that these
    veterans will continue to receive priority healthcare, disability
    payments and other benefits? If so, what efforts are you aware of
    within your department or the Congress to draft this legislation?
        Answer. No veterans will lose priority care or benefits as a result
    of expiration of Public Law 105-277. Section 513 of the recently
    enacted Public Law 111-163, the ``Caregivers and Veterans Omnibus
    Health Services Act of 2010,'' gives both certain Vietnam-era veterans
    exposed to herbicides, as well as veterans of the gulf war, special
    priority care for treatment.
        Benefit determinations and payments initiated under Public Law 105-
    277 will continue to be made. For future reference, 2 of the 3 expiring
    sections of Public Law 105-277, including the one affecting benefit
    decisions, actually expired on the first day of fiscal year 2010 per
    Public Law 105-277, 122 STAT 2681-744 and 745.
        Question. Secretary Shinseki, given the importance of the care we
    give to veterans, and knowing that not all needs can be adequately
    reflected in a budget document, what do you feel are critical or
    important needs at the Department of Veterans Affairs that are not well
    reflected in the fiscal year 2011 budget request?
        Answer. The 2011 VA budget continues the strong commitment of the
    President with an increase in discretionary funding of almost 20
    percent since 2009. The budget reflects a balanced and prioritized
    program that addresses the most critical and important needs of the
    Department. It allows VA to improve services for veterans and continue
    transformation of the VA. VA's 2011 budget focuses on three concerns
    that are of critical importance to our veterans--easier access to
    benefits and services; reducing the disability claims backlog and the
    time veterans wait before receiving earned benefits; and ending the
    downward spiral that results in veterans' homelessness. The budget
    includes $799 million in specific programs to eliminate homelessness
    and $250 million for Rural Health Initiatives. It also provides a $42
    million increase in telehealth funding in VHA and an unprecedented
    increase of 27 percent in funding for VBA to address the disability
    claims backlog. Funding is also provided to continue improving the
    condition of VA's capital infrastructure.
                                     ______

                  Questions Submitted by Senator Patty Murray

        Question. Secretary Shinseki, I was deeply disturbed by the news
    reports in January stating the VA's preliminary data show a dramatic
    increase in veterans suicide between 2005 and 2007. The fact that our
    veterans have sacrificed for our Nation only to spiral into depression
    and suicide is appalling. The preliminary data did suggest that access
    to VA services makes a difference in suicide prevention. The VA needs a
    more comprehensive effort and these numbers show that the duty of
    providing mental health services and outreach to our returning veterans
    is still a challenge.
        Answer. VA shares your concern regarding veteran suicide. Each is a
    tragedy for the veteran, his family, the community and the Nation. The
    rates of suicide among veterans in the 16 States monitored by the
    Center for Disease Control and Prevention's (CDC) National Violent
    Death Reporting System increased from 2005 to 2007. The increases were
    greatest among those veterans aged 18-29, with only a slight increase
    among those aged 30-64, and a slight decrease among those 65 and older.
    However, among those aged 18-29, suicide rates decreased significantly
    in those veterans who came to VA for services. VA interprets these
    findings as an early indication that VA's mental health enhancements
    and its suicide prevention programs are working for those who come to
    us for care. As a result of these statistics, as well as other factors,
    VA is transforming its mental health system to follow a public health
    model, providing more programs and resources to veterans in the
    community and the Nation as a whole, as well as to those seen in our
    medical centers, clinics, and Vet Centers. These efforts will focus on
    outreach and education to returning service members and veterans, and
    to veterans of all eras in their communities. The goal is to encourage
    as many eligible veterans as possible to seek care within VA, and to
    support help-seeking for all veterans when they need it. Specific plans
    are being developed as components of VA's Operating Plan for Mental
    Health for 2011-2013, and the Department of Defense (DOD)-VA Integrated
    Strategy for Mental Health.
        Additionally, VA created the Veterans National Suicide Prevention
    Hotline in June 2007 to help veterans in crisis. To date, the hotline
    has received almost 256,000 calls and rescued about 8,100 people judged
    to be at imminent risk of suicide since its inception. The center's
    newest feature is a chat line for those who prefer computer-oriented
    communication, especially young veterans. Both the hotline and chat
    line are available 24 hours a day, 7 days a week.
        Question. It has been 9 years since our service members have been
    going to war, often for multiple deployments. What have we done to
    improve the mental health efforts of those returning veterans?
        Answer. VA has made enormous efforts to expand access to care,
    continuity of care, and quality of care regarding mental health
    concerns of returning veterans. Those efforts particularly began in
    2005, with the implementation of the VA Comprehensive Mental Health
    Strategic Plan. In each fiscal year from 2005 through 2008, VA funded
    elements of the Strategic Plan for implementation, with broad national
    development of innovative programs and overall enhanced staffing of
    mental health services. In fiscal year 2008, the results of
    implementation helped VA organize a national model of what mental
    health services must be made available to all eligible, enrolled
    veterans seeking VA healthcare. The resulting document, VHA Handbook
    1160.01, ``Uniform Mental Health Services in VA Medical Centers and
    Clinics,'' became VA policy at the start of fiscal year 2009 and is
    being fully implemented throughout the system nationally, with regular
    monitoring of implementation showing excellent progress. As of the end
    of December 2009, VA medical centers and community-based outpatient
    clinics (CBOC) reported an implementation rate of 98 percent for the
    more than 200 requirements in the Uniform Mental Health Services
    Handbook.
        We have reported previously on VA mental health efforts--some of
    the successes include (but are not limited to) the following:
    increasing mental health staff by over one-third, from 14,000 to over
    20,000 nationally and decreasing time to a first appointment for new
    mental health referrals with a standard of evaluation within 24 hours.
    This is then followed by urgent care, if needed, or development and
    implementation of a treatment plan within the next 14 days (with 96
    percent success in meeting this standard). VA has also developed the
    Suicide Prevention Hotline and teams of Suicide Preventions
    Coordinators at every VA facility. VA integrated mental health into
    primary care clinics and mandated screening for mental health problems
    to include: PTSD, depression, problem drinking, military sexual trauma,
    and suicide risk assessment if PTSD or depression screens are positive.
    Finally, VA expanded substance use disorder treatment and treatment of
    co-occurring substance use and PTSD problems.
        All of these efforts improved the full system of care for all
    veterans, but there also have been elements specifically designed to
    serve returning Operation Enduring Freedom and Operation Iraqi Freedom
    (OEF/OIF) veterans. These include:
      --Development of special mental health staff specifically reaching
            out to returning veterans, in the system, to ensure mental
            health issues are fully addressed.
      --Integration of these staff into the Post-Deployment OEF/OIF special
            primary care clinics.
      --Collaboration with the case management system for OEF/OIF veterans
            to ensure mental health needs are always considered.
      --Placement of mental health staff in specialty polytrauma care
            settings for severely wounded returning veterans.
      --Training of over 3,000 VA mental health staff in evidence-based
            psychotherapies for PTSD, depression, family distress, and
            other mental health disorders that have been shown in research
            and clinical practice to have the greatest likelihood of
            resulting in significant improvement in these mental health
            conditions. Training has been provided with guidance to ensure
            that initial implementation of these therapies should target
            OEF/OIF veterans, to provide early intervention as much as
            possible.
      --Expansion of mental health services for women veterans. Female OEF/
            OIF veterans are more likely to seek VA care than male OEF/OIF
            veterans, and their increasing numbers require VA to expand
            services. Specific requirements for serving female veterans are
            included in the VA Uniform Mental Health Services Handbook
            mentioned above.
      --Collaboration with the Defense Centers of Excellence (DCOE) for
            Psychological Health and Traumatic Brain Injury, to coordinate
            efforts.
      --Implementation and planning of a joint VA/DOD Mental Health Summit
            with DCOE and other health components of DOD. This has led to
            development of an integrated Mental Health Strategic Plan to
            increase coordination and continuity of care as service members
            obtain care in DOD, then separate and come to VA for care.
        In summary, VA has transformed its overall mental health services
    in the last 5 years, and that transformation has included focused
    efforts to ensure enhanced care for currently returning OEF/OIF
    veterans. These efforts will continue to receive priority.
        Question. Why do we still not have the trained mental health
    professionals in all of our VA facilities?
        Answer. VA does have a greatly increased number of mental health
    staff throughout the system, with mental health professionals in all VA
    medical facilities. Community living centers, residential
    rehabilitation treatment programs and domiciliaries have access to
    mental health resources because they are co-located with other
    facilities (hospitals or outpatient centers) that have mental health
    professionals. All large community-based outpatient clinics (CBOC) and
    all vet centers also have mental health staff who provide outpatient
    mental health services. Smaller CBOCs must provide mental healthcare
    through telemental health connections or by contract or fee basis. In
    addition, all medical facilities have mental health professionals who
    have been trained in providing various evidence-based psychotherapies
    and connections to staff with such training are available via
    telemental health in most CBOCs. VA strongly believes in ensuring that
    VA mental health staff members have appropriate, high quality training
    to promote the delivery of high quality, evidence-based and recovery-
    oriented services. VA qualification standards for employment in mental
    health positions require that mental health professionals have
    established levels of education necessary to provide clinical care,
    with specific competencies required for specific clinical activities
    and responsibilities.
        VA develops and provides extensive training to mental health staff
    throughout its healthcare system on a broad array of mental health
    topic areas to ensure that mental health staff can deliver high quality
    care that is consistent with current clinical science. As part of its
    commitment to training and high quality patient care, VA has developed
    national staff training programs in state-of-the-art, evidence-based
    psychotherapies (EBPs), including cognitive processing therapy and
    prolonged exposure therapy for posttraumatic stress disorder (PTSD),
    cognitive behavioral therapy and acceptance and commitment therapy for
    depression, and social skills training and family psychoeducation for
    serious mental illness. Training in these programs consists of two key
    components: (1) participation in an in-person, experientially based
    workshop of 2-4 days in length, followed by (2) active participation in
    weekly consultation with an expert in the specific psychotherapy for
    approximately 6 months. To date, VA has provided training to over 3,000
    mental health staff in evidence-based psychotherapy, including
    providing evidence-based psychotherapy training to staff at all VA
    medical centers.
        In addition, VA annually provides national and regional training to
    mental health staff on a wide variety of mental health topics through
    VA's Employee Education System. These trainings are provided through
    in-person conferences, videoconferences, Web-based trainings, and DVD
    video trainings. In addition to training provided through these
    national mechanisms, local VA facilities provide a wide variety of
    mental health trainings to mental health staff on specific mental
    health topics.
        Question. What can Congress do to assist you? Do you need
    additional hiring authorities or incentives?
        Answer. VA's fiscal year 2011 budget provides for more than $5.2
    billion for mental health, an increase of $410 million, or 8.5 percent,
    over the 2010 enacted level. We will expand inpatient, residential, and
    outpatient mental health programs with an emphasis on integrating
    mental health services with primary and specialty care. Recent VA
    research has demonstrated that the more returning veterans feel
    supported by their communities and by the Nation as a whole, the less
    likely they are to develop PTSD and depression. Congress has helped our
    troops and veterans by continuing to support mental health programs.
        VA has significantly invested in our mental health workforce,
    hiring more than 6,000 new workers since 2005. VA has estimated that
    the current level of staffing is sufficient to meet the needs of
    veterans who use VHA for their mental healthcare. There are still a
    small number of unfilled positions at various VA medical facilities
    that are supported with mental health enhancement funds. Direction has
    been sent to all Veterans Integrated Service Networks (VISNs) to use
    the enhancement funds to fill these positions. In addition, it is
    essential that this level of staffing be sustained, e.g., positions
    that are vacated through retirement or other departures are filled in
    timely fashion.
        VA has not experienced widespread difficulties in hiring and
    retaining mental health professionals. However, it has been VA's
    experience that in certain localities, particularly highly rural
    regions, there may be a limited number of mental health professionals,
    especially psychiatrists. Specific incentives have been developed and
    used in such situations. In addition to opportunities for education
    debt reduction, VHA has established opportunities for facilities to
    engage in local advertising and recruitment activities, and to cover
    interview-related costs, relocation expenses, and provide hiring
    bonuses for certain applicants. Flexibility is provided to hire
    providers of other appropriate disciplines or to utilize fee-basis or
    contract care, when indicated, so that veterans have continuous access
    to the full continuum of mental health services.
        Question. In Washington we are bringing in residents to assist with
    the manning shortfall. Do we need to expand the program?
        Answer. Recognizing the importance of mental health services in the
    overall care of veterans, VA has expanded training positions in the
    core mental health disciplines of Psychology, Psychiatry, and Social
    Work. Within Graduate Medical Education (GME), VA launched the GME
    Enhancement Initiative in 2006 to expand physician residents in areas
    of need to attain greater geographic balance in resident allocations,
    and to foster innovation in the models of training physician residents.
    The GME Enhancement Initiative created an additional 1,221 physician
    residents positions, with 123 in psychiatry, and 169 in all mental
    health related specialties.
        In addition, over the last several years, VA has pursued an
    initiative to increase the number of non-physician mental health
    practitioners, especially psychologists and social workers. These
    efforts have been highly successful. Psychology has expanded its
    national trainee complement by 251 positions, to a total of 683
    nationally. Moreover, social work training positions have increased
    from 588 to 732 for the coming year.
        The impact of these initiatives for the State of Washington is
    shown in the chart below. The overall increase in VA mental health
    training positions (psychiatry, psychology, and social work) from 2005
    to the present is 48 percent.

        These data suggest that Washington has benefited greatly from
    recent expansions in trainee positions. In addition, because of the
    rural nature of practice in some parts of Washington, it is anticipated
    that the State will continue to have a high priority for future trainee
    expansions.
        Question. Secretary Shinseki, as you know, women are the fastest
    growing subsection of veterans and increasingly in need of services
    from our VA system. Unfortunately the VA has been slow to modernize to
    meet their unique physical and mental health needs. I recognize the VA
    is trying to make changes at their facilities to make them more female-
    friendly, but there appears to lack a coherent, nationwide plan to
    review and assess the capabilities of all facilities and create a
    capital plan to start addressing shortfalls in high demand areas.
        What is the status of a VA-wide capital plan to evaluate each
    facility in the VA system and target those that service greater
    populations of female veterans and veterans with children?
        Answer. VA has undertaken an ongoing assessment and improvement
    process to ensure that VHA facilities meet the healthcare needs of
    women veterans in a friendly and safe environment that respects their
    unique needs, dignity, and privacy.
        Elements relevant to structural, environmental, and psychosocial
    patient safety and privacy issues have been incorporated into VHA's
    monthly environment of care rounds checklist. VA is obtaining monthly
    assessments from each medical center in order to follow actions taken
    to address identified issues in the privacy and security of all
    veterans. Women Veteran Program Managers at each medical center are
    included in the review process.
        In addition, an annual review of structural, environmental, and
    psychosocial patient safety and privacy issues in VHA patient care
    settings will be conducted by the Director, Environmental Program
    Service and incorporated into monthly environment of care rounds.
        The Women Veteran's Health Strategic Health Care Group is in the
    process of performing a comprehensive assessment of facilities' current
    capacity for providing optimal care of women veterans. The assessment
    includes site visits and tours of six medical centers in fiscal year
    2010 with ongoing assessments in fiscal year 2011. During tours, the
    site assessment team will review available space, environmental
    considerations (e.g., signage, privacy), patient and provider flow, and
    availability of equipment and supplies. The assessment team will also
    conduct brief interviews with staff in each of these areas. Results of
    the assessment will be used to address deficiencies and drive future
    budget allocation requests.
        VA's design and construction standards are being enhanced to
    address the physical and mental healthcare needs of women veterans.
    Space planning criteria are being adjusted for specific functions to be
    performed (mammography spaces, outpatient clinics, radiation therapy,
    etc.).
        The national capital plan to address women's healthcare is
    incorporated into the new Strategic Capital Investment Planning (SCIP)
    process. With this process, every medical center will identify how it
    will mitigate service delivery gaps over a 10-year window, including
    women's privacy deficiencies. As part of the SCIP process, we will
    create corporate data to support women's privacy needs to ensure a more
    focused effort is dedicated to mitigating the deficiencies.
                                     ______

              Questions Submitted by Senator Kay Bailey Hutchison

        Question. The VA has established a new policy to presume veterans
    with ischemic heart disease, Parkinson's disease, and B cell leukemia
    and who served in Vietnam are entitled to compensation benefits as a
    result of their exposure to Agent Orange. The Department estimates this
    new policy will result in approximately 150,000 new claims generated in
    2010, and for the total number of disability claims to increase from 1
    million in 2009 to 1.3 million in 2010. The claims process already
    takes too long to make decisions on a veteran's disability claim, and I
    am highly concerned that this new policy will further complicate the
    already large claims backlog.
        I understand that there are funds for 1,800 new claims processing
    staff in the 2011 budget (excluding term-hire positions included in
    last year's stimulus bill), and I applaud the effort to handle this
    influx in claims. But since 2007, this subcommittee has appropriated
    funding to add nearly 7,000 new positions to the VA's claims processing
    staff, and there has been no significant decrease in claims processing
    time. This does not seem to be purely a problem of understaffing.
        Does the Department have any estimates on how the 30 percent
    increase in claims receipts will affect the processing time, and what
    can we do to help you tackle this problem?
        Can you tell me whether the Department is looking at new ways to
    change the way in which it handles disability claims and what impact
    the paperless claims IT project will have on both the claims backlog
    and the average claims processing time?
        Answer. Currently, the average time to process a disability
    compensation claim is about 160 days. Based on the continued growth in
    claims receipts and the anticipated influx of claims related to the new
    Agent Orange presumptions VA anticipates our inventory will rise to
    over 700,000 claims in 2011, and the average time to process claims is
    expected to increase as a result.
        The Veterans Benefits Administration now employs more than 11,600
    full-time claims processors and plans to add 3,000 more in fiscal year
    2011. However, continuing to increase the size of our workforce is
    neither a long-term nor scalable solution; we need to do a much better
    job of leveraging network automation and software productivity tools to
    more effectively manage our workload and serve our clients. Bold and
    comprehensive changes are needed to transform VA into a high-performing
    21st century organization that provides high quality services to our
    Nation's veterans and their families.
        VA's transformation strategy leverages the power of 21st century
    technologies applied to redesigned business processes. Pilot programs
    are underway at four of our regional offices to support our business
    transformation plan to reduce the claims backlog, improve service
    delivery, and increase efficiencies. Each pilot functions as a building
    block to the development of an efficient and flexible paperless claims
    process. The results of all four pilots will be incorporated into the
    nationwide deployment of the Veterans Benefits Management System (VBMS)
    in 2012. VBMS will be built upon a service-oriented architecture,
    enabling electronic claims processing by providing a shared set of
    service components derived from business functions. Initially, VBMS
    will focus on scanned documents to facilitate the transition to a
    paperless process. Ultimately, it will provide end-to-end electronic
    claims workflow and data storage.
        VA is also seeking contractor support in development of a system to
    support evidentiary assembly and case development of the new Agent
    Orange presumptive claims. The system will enable veterans to
    proactively assist in the development of their claims through a series
    of guided questions and will automate many development functions such
    as Veterans Claims Assistance Act notification and follow up.
        In addition to an electronic claims processing system, VA is
    committed to improving the speed, accuracy, and efficiency with which
    information is exchanged between veterans and VA, regardless of the
    communications method. The Veterans Relationship Management (VRM)
    transformational initiative will provide the capabilities to achieve
    on-demand access to comprehensive VA services and benefits in a
    consistent, user-centric manner to enhance veterans', their families'
    and their agents' self-service experience.
        Question. It is everyone's goal to leverage information technology
    to improve services to our veterans and to have them seamlessly
    transition from DOD to the VA. A paperless solution to the disability
    claims backlog, a lifetime electronic service record that follows a
    soldier through DOD and VA, a new electronic health record, and a
    financial management system that provides greater accountability of
    government resources all have potential to transform the VA. However,
    the Department has a poor track record in its ability to develop and
    implement these costly programs. An internal audit by the VA last year
    temporarily halted 45 of the VA's 282 ongoing IT projects because they
    were either significantly over budget or behind schedule, and the
    Department's 2011 budget proposes $3.3 billion for IT, which is
    identical to the 2010 appropriation, not including the nearly $700
    million that was unspent from the 2010 appropriation. I am concerned
    that this may not be the most efficient use of taxpayer dollars in 2011
    without proper oversight and transparency. These projects are of great
    importance to our veterans, and I want to be sure they succeed.
        Mr. Secretary, have you found the certification requirements
    included in last year's bill to be helpful in your efforts to improve
    management over IT projects and programs?
        Answer. In 2010, VA has fully implemented its Project Management
    Accountability System (PMAS). This system has put in place the
    necessary program review and rigor to examine an IT project's chances
    for success on an ongoing basis. PMAS has been successful in
    identifying what projects VA should terminate and what projects should
    continue. Now that the PMAS process is in place, all IT projects must
    be certified by the Chief Information Officer in order to receive
    funding and approval to proceed. With PMAS in place, we believe bill
    language requiring certification may no longer be necessary. The
    Department is committed to keeping the Committee informed on the PMAS
    process and the status of IT projects.
        Question. Mr. Secretary, we believe there is the potential for more
    budgetary steps to be taken to improve accountability over IT projects,
    such as separating the 1-year costs of staff salaries and expenses, and
    operations and maintenance costs, from the longer-term costs of
    developing new IT programs. Do you have any thoughts on that idea?
        Answer. The Department appreciates the flexibility Congress has
    provided by making funds appropriated to the Information Technology
    Systems account available for a 2-year period. This flexibility was a
    key factor and management tool in VA's successful consolidation of all
    IT funding into one account over a 3-year period.
        The Department would like to retain this management flexibility for
    administering its IT program. VA continues to refine its accounting for
    IT costs; this includes better defining which projects are purely new
    development projects as opposed to operations and maintenance projects.
    The distinction is not always simple to discern, and there would be
    some risk in segregating the availability of these funds either by time
    period or by establishing separate accounts. In addition, the
    availability of 2-year funding for salaries and administrative costs
    will enable IT managers to effectively plan for the hiring of
    additional staff and to adjust to unanticipated changes impacting the
    workforce.
        Currently, VA identifies development, operations and maintenance,
    and salary/administrative costs separately as part of the annual budget
    submission and the IT project reprogramming baseline. We will continue
    to do so to meet the information needs of the Congress.
        Question. Can you tell us how many of your project managers are
    ``Project Management'' certified by an outside organization (such as
    Project Management Institute, etc.)?
        Answer. Trained project management leaders are critical to ensuring
    IT project success. As an important part of workforce management, all
    project managers are involved in ongoing project training, training
    that can be applied towards Project Management certification
    requirements. At present, 70 percent of IT development project and
    program managers maintain credentials in Program Management, either
    through organizations such as the Project Management Institute or VA's
    rigorous Project Management training programs.
        Question. Mr. Secretary, the 2011 budget recommends nearly $2
    billion for the VA construction program, including $864 million in
    site-specific funding for new or replacement hospitals. However, I was
    concerned to see that there was $2.56 billion in unobligated funds from
    2009 into 2010, more than the last 2 years of major construction
    appropriations, for projects that should be obligated within the fiscal
    year. I am concerned that our major construction program is not
    spending its appropriations in a timely and efficient manner, and I
    want to work with you to resolve this challenge. As I'm sure you know,
    this is an issue for military construction projects, and we combat it
    by making projects subject to 5-year funding and by having the services
    publish a Future Years Defense Program (FYDP) that outlines each
    service's expected construction needs in the immediate future. This
    helps us to ensure efficient budgetary planning and that only those
    projects that are shovel-ready receive funding.
        Mr. Secretary, as a former Army Chief of Staff, do you have any
    thoughts on making new VA construction projects subject to some of
    these rules? Would you be willing to submit a prioritized ``FYDP'' for
    VA construction projects in order to ensure they are shovel-ready and
    to help us be more fiscally responsible to our veterans and to the
    taxpayer?
        Answer. VA does not support restricting the availability of major
    construction funding to 5 years. Construction funds should remain as no
    year money. Once funding is received for a major project, it is
    obligated over a period of several years for design, construction,
    contingencies, completion items and contract closeout. VA monitors the
    progress closely to ensure contracts remain on time and within budget.
    There are several reasons that project funding remains unobligated
    including:
      --When VA awards a construction contract, a contingency is set aside,
            5 percent on new construction and 7.5 percent on renovation.
            The contingency set-aside is available to address unforeseen
            conditions. These funds are not obligated until needed and
            contribute to the unobligated amounts.
      --Some projects are phased. Funds required for future phases cannot
            be awarded until the preceding phase is completed. There are 10
            projects with funding of $698.6 million that have future
            phases. These projects have phases that are currently under
            construction that must be completed prior to awarding the
            subsequent phase. Some of these phases will be awarded later
            this fiscal year. Some of the high visibility projects in this
            category are polytrauma centers at Palo Alto and Tampa
      --When contract claims have been filed or are anticipated, funding is
            held after completion in case it is needed when a claim is
            adjudicated.
        There are 4 projects with funding of $713.3 million that are
    currently in design and VA anticipates a construction award later this
    fiscal year. Some of the high visibility projects in this category are
    new medical facilities at New Orleans and Denver. Projects like these
    would be halted until funding could be obtained if funding is
    restricted. The major challenge for VA has been in the planning phase
    for these projects. The current process selects projects for initial
    budget submission without the benefit of early design. Projects at this
    stage often have significant unknowns such as constructability issues,
    incomplete scope definition and the need to complete environmental,
    historic preservation and often real estate due diligence. The
    resolution of these issues contributes to delay in making significant
    obligations on the projects.
        VA submits a 5-year Capital Plan annually with the President's
    budget submission. The current 5-year plan lists approximately 92 major
    projects. These projects may vary from year to year due to re-
    prioritization each year--new projects are added, while others are
    removed as alternative investment strategies (e.g., leases or enhanced-
    use leases) are utilized to provide the services. Currently the
    Department is embarking on a Strategic Capital Investment Planning
    (SCIP) process that will provide a 10-year plan for all capital
    investments. This plan will help to address where facilities are needed
    throughout the Department based on demographics, changes in the
    delivery of care, and the type of care to be provided. The SCIP process
    will result in a consolidated prioritized list for all capital
    investments (major/minor construction, non-recurring maintenance, and
    leases) for 2012-2021. This multiyear planning effort will thus
    obligate project funding sooner after an appropriation from Congress is
    received.
        Question. Mr. Secretary, I understand that the VA has conducted a
    comprehensive review of the VA's approach and practices to treat
    veterans of the 1990-1991 gulf war. This Gulf War Illness Task Force
    recently released its report and recommended adding nine new conditions
    as automatic presumptions for service-connected injuries. I applaud
    your efforts to improve the lives of those veterans suffering from
    undiagnosed illnesses during this conflict and hope we remain committed
    to treating those affected and finding a cure. However, as I understand
    it, this new policy was not in effect when the Department's 2011 budget
    was formulated.
        Assuming these new presumptions go into effect, has the Department
    made any cost estimates for adding these nine new presumptive
    conditions for gulf war veterans?
        How does the VA expect to pay for these new presumptions if they
    are not in the Department's 2011 budget request?
        Answer. The compensation benefit costs associated with this
    proposed rule are estimated to be $1.5 million during the first year,
    $11.5 million for 5 years, and $36.4 million over 10 years. VBA will
    provide updated fiscal year 2011 projections in the annual Mid Session
    Review budget submission. This budget submission will include changes
    in economic assumptions, changing trends based on FYTD experience, and
    technical adjustments including estimated effects of proposed rules.
        The decision to create nine new presumptives based on exposure to
    infectious agents in the Gulf resulted from the IOM report on Gulf War
    and Health, Volume 5, Infectious Agents. The Secretary's decision to
    establish these presumptions was made prior to the formation of the
    Gulf War Illness Task Force.
                                     ______

                 Questions Submitted by Senator Mitch McConnell

        Question. Telemedicine is a tool that would seem to have potential
    to provide improved access to healthcare services for rural veterans,
    allowing them to get the medical advice they need without undertaking
    the time and expense of driving to a major VA facility. What measures,
    if any, are being taken by the VA to expand the use of this technology
    to help rural veterans?
        Answer. VA's 2011 President's budget includes an investment of $163
    million in home telehealth. Taking greater advantage of the latest
    technological advancements in healthcare delivery will allow us to more
    closely monitor the health status of veterans and will greatly improve
    access to care for veterans in rural and highly rural areas.
        Telehealth is one of the ways in which VA is actively increasing
    access for veteran patients to healthcare services in rural and remote
    locations. In fiscal year 2009, 118,000 veterans received healthcare
    services from VA in rural and remote locations via telehealth. This
    number represented a 20 percent increase over fiscal year 2008 levels
    and included 16,000 veterans receiving care in their own homes via home
    telehealth, 67,000 veterans receiving teleretinal screening and
    teledermatology services via ``store-and-forward'' telehealth
    technologies and 35,000 veterans participating in specialist
    consultations between community-based outpatient clinics and VA medical
    centers, predominantly to meet mental health needs. By the end of
    fiscal year 2010, VA anticipates a further 20 percent increase in
    telehealth-based care to veteran patients in rural/remote locations.
    This will reduce avoidable time and expenses involved in veterans
    travel to a major VA facility. Telehealth, therefore, continues to be
    an important capability that VA is utilizing to meet the healthcare
    needs of veterans we serve in rural and remote locations.
        Question. In 2006, there was an alleged homicide that occurred at
    the Lexington, Kentucky VA Medical Center where the patient died due to
    an overdose of morphine. In 2009, the nurse involved in the case was
    arrested and charged with homicide.
        Consistent with any restrictions governing the release of
    information linked to ongoing criminal investigations, what further
    developments have occurred in this investigation? What actions have
    been taken by the VA to prevent events like these from happening in the
    future?
        Answer. The investigation was turned over to the VA Office of the
    Inspector General (OIG) and Federal investigators. A trial for this
    case is before the U.S. District Court, Eastern District of Kentucky,
    Central Division at Lexington, KY, and it has been re-set for October
    12, 2010. To prevent events like this from happening in the future, VA
    purchased new intravenous (IV) pumps with additional safety features.
    These features help prevent the pumps from being set over the maximum
    dosage or below therapeutic levels. VA used at the time of the event,
    and continues to use today, tubing sets that prevent the free flow of
    medication as another safety precaution. VA continues to review monthly
    dispensing practices to monitor the narcotic administration practices
    of individual staff.
        Question. Of the contract-run Community Based Outpatient Centers in
    Kentucky, what is the level of patient satisfaction with their care?
        Answer. There are two contracted CBOCs in Kentucky. The Bowling
    Green CBOC received an outpatient score of 62.7 which exceeds the VISN
    nine goal and makes it the highest satisfaction score for any Tennessee
    Valley Healthcare System CBOC. The Hopkinsville CBOC does not have a
    sufficiently large response population for a patient satisfaction
    score.
        Question. What is the VA doing to enhance efforts to locate
    homeless veterans and to provide resources and programs to help them?
        Answer. VA is taking decisive action toward its goal of ending
    homelessness among our Nation's veterans in 5 years. VA has continued
    to use and expand its Healthcare for Homeless Veterans (HCHV) efforts,
    which involve staff making direct searches of environments where
    homeless veterans are likely to be found and making every effort to
    gain their trust and bring them in for services. The National Call
    Center for Homeless Veterans (NCCHV) is a recent initiative in VA's 5-
    year plan to end homelessness. It can provide homeless veterans with
    timely and coordinated access to VA and community services, and
    disseminate information to concerned family members and non-VA
    providers about all the programs and services available to assist these
    veterans. There have been callers who have not been previously
    identified and can now be connected with VA and other services. Callers
    seeking more details about VA Homeless programs or services can also be
    referred to the VA Homeless Web site and appropriate VA medical center
    points of contact for further intervention, referral, or information.
    As information about the Call Center is more broadly disseminated by
    local VA facilities and the Homeless Coordinators in all VISNs, more
    calls are expected. This new outreach effort already is proving very
    valuable.
        In order to better track veterans located through these and other
    efforts, VA is developing a homeless veterans registry that will track
    and monitor the expansion of homeless and prevention initiatives and
    the treatment outcomes for homeless veterans. The registry will be a
    comprehensive veteran-centric registry (data warehouse) of information
    about homeless veterans who receive services provided by VA
    administered programs, as well as services provided by external Federal
    agencies, and other private and public entities. Additionally, the
    registry will also be used to identify and collect information about
    veterans who are at-risk for homelessness. This system will allow VA to
    analyze mobility among homeless veterans.
        Question. What is the VA doing to enhance the privacy of and to
    increase the resources and programs available for female veterans?
        Answer. Following recommendations by a VA workgroup on Veteran
    Privacy, Security and Dignity, a review of structural, environmental,
    and psychosocial patient safety and privacy issues has been conducted
    in VHA outpatient care settings and incorporated into monthly
    environment of care action plans. The initial review was completed in
    August 2009 and VA has been conducting monthly status updates since
    that time. The Women Veteran Program Manager participates as a member
    of the environment of care team. Each facility must engage in an on-
    going, continual process to assess and correct physical deficiencies
    and environmental barriers to care for all veterans, particularly women
    veterans. In addition, Women Veterans Program Managers and Deputy Field
    Directors are conducting on-site visits to monitor compliance with
    correction of privacy deficiencies. Findings are communicated to local
    leadership. Other strategies to ensure compliance include unannounced
    site visits by VISN Environment of Care Teams, random site visits, and
    records reviews by VHA's Office of Environmental Programs Service, as
    well as System-wide Ongoing Assessment and Review Strategy (SOARS) site
    visits. Action plans will be maintained and tracked by the VHA
    Environmental Programs Service to ensure compliance and assist with
    construction planning to renovate facilities.
        Current initiatives to increase resources and programs available to
    women veterans include:
      --Redesigning Primary Care for Women.--Specifically, VHA is
            redesigning comprehensive women's healthcare delivery within
            three models of care, which co-locate commonly used services
            and specialties into one care delivery process, ensuring that
            women can receive all of their primary healthcare (prevention,
            medical, and routine gynecologic care) by a single primary care
            provider. Our goal is to decrease fragmentation of care and
            improve continuity of care.
      --A Full-Time Women Veteran Program Manager at Each Site.--As of June
            28, 2010, 132 of the 144 facilities with a Women Veterans
            Program Manager has a full-time employee in place; seven other
            facilities have an acting or interim Women Veterans Program
            Manager, and four of the remaining five will fill the position
            by August 2010.
      --National Training Programs for Women's Healthcare Providers.--
            Improving primary care clinicians' proficiency, knowledge, and
            cultural sensitivity in women's health and VA resources
            available to women veterans through the implementation of mini-
            residency programs.
      --Evaluation of Primary Care for Women.--Assessing VA women's health
            programs through the creation of an assessment tool to identify
            highly developed women's health programs, their best practices,
            and better understand successful pathways to implementing
            comprehensive women's health.
      --Women Veteran Outreach Campaigns.--Educating women veterans through
            age and culturally informed communication and outreach
            initiatives. For example, modifying their cardiovascular risk
            factors and maintaining their health status in order to delay
            the onset of complex chronic conditions.
        Question. The percentage of female veterans who do not show up for
    their medical appointments is in many cases greater than the percentage
    of male veterans that do not show up for theirs. What is the VA doing
    to better understand why this occurs, and what is being done to reduce
    this higher percentage?
        Answer. Addressing barriers to access for women veterans is a
    priority. VHA is preparing a report, ``Assessment of the Health Care
    Needs and Barriers to VA Use Experienced by Women Veterans: Findings
    from the National Survey of Women Veterans.'' One of the aims of the
    National Survey of Women Veterans (NSWV) was to determine how
    healthcare needs and barriers to VA healthcare use differ among women
    veterans of different periods of military service and assess women
    veterans' healthcare preferences in order to address VA barriers and
    healthcare needs. The interim report on barriers to care will be
    complete by mid-July 2010 with the final report anticipated to be
    published in 2011.
        In addition, several current initiatives will directly improve
    access to care for women veterans.
      --Redesigning Primary Care for Women.--Our goal is to decrease
            fragmentation of care and improve continuity of care. By
            providing all of a woman veteran's care from one provider, no-
            show rates will be improved by decreasing the number of
            appointments a women veteran will have to keep.
      --Patient Centered Medical Home (PCMH).--VHA recognizes the unique
            needs of women veterans, specifically the need for after hours
            care, women's health providers at community based outpatient
            centers (CBOC) and flexibility in how appointments are
            scheduled due to demands as the primary caregivers of their
            families which often include other veterans and inflexible work
            schedules. The PCMH improves access to care by providing
            flexibility in when and how women veterans schedule appointment
            time so complicated schedules can be accommodated. Access to
            women's health providers in a CBOC means fewer miles traveled
            to see a provider who can meet women veterans' needs.
        In addition, PCMH improves access through direct contact with case
    managers who will assist veterans with care coordination, facilitates
    veteran participation with their healthcare with the use of self-
    management health tools and improves veteran satisfaction by allowing
    for greater communication with a provider and the veteran through
    alternative forms of communications such as the Internet through secure
    messaging.
        Question. Following the Wounded Warrior legislation and the Dole-
    Shalala Commission's recommendations, improvements were to be made to
    the coordination mechanisms between DOD and VA facilities to better
    care for our injured troops who are transitioning between the two
    healthcare systems. What steps have already taken place to improve
    coordination between the two Departments? What steps remain? Are these
    provisions sufficient to provide a seamless transition for wounded
    warriors from the DOD to the VA system? Does DOD or the VA need further
    legislative authority to improve matters? If so, what?
        Answer. To ensure a smooth transition from the Department of
    Defense (DOD), VA has stationed 33 healthcare liaisons at 18 military
    treatment facilities to facilitate the transfer of care to VA
    facilities. This program grew during 2009 with six additional liaisons
    at five new sites. Altogether these liaisons have assisted more than
    20,000 service members in transitioning from DOD to VA since 2004. We
    continue to work with DOD to identify additional sites that have
    increasing numbers of wounded warriors who may benefit from these
    services. VA works closely with DOD to support high quality integrated
    care for severely injured service members and veterans. The two
    Departments recently developed revisions to clinical codes to improve
    identification and tracking of traumatic brain injury (TBI). In 2009, a
    5-year pilot project to provide assisted living services for veterans
    with severe TBI was initiated in collaboration with the Defense and
    Veterans Brain Injury Center (DVBIC). We have placed three veterans in
    Virginia, Florida and Wisconsin, and enrollment is pending for two
    veterans in Texas and Kentucky.
        Pursuant to the Dole-Shalala Commission's recommendation, VA and
    DOD collaborated on development of the eBenefits portal to provide a
    single and transparent access point to online benefits for wounded,
    ill, and injured service members, veterans, and their family members
    and care providers. The eBenefits portal has expanded beyond its
    original scope and is now intended to be an interactive Web portal for
    all veterans, service members, and their families. In April 2010,
    eBenefits launched version 2.3 that provides on-line capability to
    check the status of disability claims, review payment histories, obtain
    home loan certificates of eligibility, and obtain military documents.
        In November 2007, DOD launched the Disability Evaluation System
    (DES) Pilot to modernize the process by which potentially unfit
    wounded, ill, and injured service members are evaluated for retirement,
    separation, or placement on the temporary disability retirement list. A
    single medical examination is used by both DOD and VA in determining
    entitlements. The pilot program began in November 2007 in the National
    Capitol Region (Walter Reed Army Medical Center, National Naval Medical
    Center (NNMC) at Bethesda, and Malcolm Grow Air Force Hospital) and has
    since expanded to 24 additional military installations. Of those
    separating with a medical disability, approximately 47 percent
    participate currently in the DES pilot process. VA and DOD are
    developing a plan to deploy and transform the DES pilot into the
    integrated DES process worldwide by the end of fiscal year 2011.
        VA believes current legislative authority is sufficient to ensure a
    smooth transition of our injured troops from DOD. VA will work closely
    with the Committee if further legislative authority is needed in the
    future.
        Question. The Western Kentucky Veterans Center expansion in Hanson,
    Kentucky is listed as priority #47 in the Fiscal Year 2010 Priority
    List of Pending State Home Construction Grant Applications subject to
    38 CFR part 59. (It involves increasing the number of beds by 40). It
    is my understanding that an updated priority list for fiscal year 2011
    will be submitted sometime in the fall. Although Kentucky is classified
    as a ``limited needs'' State by the VA, I want to ensure that expansion
    of the Hanson facility takes place in the near future and is not
    permitted to slide down the list of priorities. How can we ensure that
    even ``limited needs'' States such as Kentucky are properly looked
    after in the State Home Construction Grant Application process?
        Answer. The Department of Veterans Affairs (VA) may have sufficient
    funds to participate in a grant for the construction of a 36-bed
    expansion project at the State Veterans Home in Hanson, Kentucky during
    fiscal year 2010. A letter was sent to the Honorable Ken Lucas,
    Commissioner Kentucky Department of Veterans Affairs on May 18, 2010,
    stating VA participation in the project is contingent upon the State of
    Kentucky's compliance with the remaining Federal requirements listed in
    title 38, Code of Federal Regulations, part 59. All projects on the
    priority list are strictly ranked following the guidelines in the
    regulation which places life safety projects at the top of the list.
                                     ______

                  Question Submitted by Senator Susan Collins

        Question. Many of the employees at VA Togus focus specifically on
    disability claims processing. I was recently was told that the Veterans
    Benefits Administration at Togus is in the process of hiring 40 new
    employees that will process disability claims for 8,000 cases related
    to new Agent Orange and Agent Purple claims. I understand that another
    20 employees may be added at Togus to continue to help reduce the
    disability claims backlogs. Because of the age of some of the buildings
    and recent storms, as well as the increasing number of claims
    processing employees, the facility may require additional space and
    administrative offices. Has the Department reviewed the space
    requirements at the VBA facility at Togus or can you commit to
    performing such a review in the near future?
        Answer. The Togus Regional Office (RO) received authority to hire
    61 additional full-time employees. The RO is actively recruiting, and
    32 employees are already on the rolls. The RO plans to use 40 new
    employees to process Agent Orange claims with the remaining new
    employees focused on processing the regular disability claims workload.
    To fully utilize the space at the RO facility, the majority of the new
    employees will work during a second shift. The RO is on the campus of
    the Togus VA Medical Center. Although an older building, significant
    investments were made over the last 2 years to improve the physical
    space. The improvements include new windows, a new roof, and a new
    heating, ventilation and cooling system.

                              SUBCOMMITTEE RECESS

        Senator Johnson. This hearing is recessed.
        [Whereupon, at 3:17 p.m., Thursday, April 15, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

       MILITARY CONSTRUCTION AND VETERANS AFFAIRS, AND RELATED AGENCIES
                      APPROPRIATIONS FOR FISCAL YEAR 2011

                                  ----------

                            THURSDAY, APRIL 22, 2010

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10 a.m., in room SD-124, Dirksen
    Senate Office Building, Hon. Tim Johnson (chairman) presiding.
        Present: Senators Johnson, Pryor, Collins, and Murkowski.

                             DEPARTMENT OF DEFENSE

                             Department of the Army

    STATEMENT OF HON. LOUIS JEROME (JERRY) HANSEN, DEPUTY
                ASSISTANT SECRETARY OF THE ARMY (STRATEGIC
                INFRASTRUCTURE) AND SENIOR OFFICIAL
                PERFORMING DUTIES OF ASSISTANT SECRETARY OF
                THE ARMY (INSTALLATIONS AND ENVIRONMENT)
    ACCOMPANIED BY:
            JOSEPH F. CALCARA, DEPUTY ASSISTANT SECRETARY OF THE ARMY
                (INSTALLATIONS AND HOUSING)
            BRIGADIER GENERAL JIM BOOZER, DIRECTOR OF OPERATIONS, OFFICE OF
                THE ASSISTANT CHIEF OF STAFF (INSTALLATION MANAGEMENT)
            MAJOR GENERAL RAY CARPENTER, ACTING DIRECTOR, ARMY NATIONAL
                GUARD
            JAMES SNYDER, ASSISTANT CHIEF, ARMY RESERVE

                    OPENING STATEMENT OF SENATOR TIM JOHNSON

        Senator Johnson. This hearing will come to order.
        I welcome everyone to today's hearing to discuss the
    President's fiscal year 2011 budget request.
        Today we will hear from two panels of witnesses
    representing the Army and the Air Force and their Reserve
    components.
        The first panel will be the Army. Secretary Hansen,
    Secretary Calcara, General Boozer, General Carpenter, Mr.
    Snyder, thank you for coming today. General Carpenter, I am
    always happy to see a fellow a South Dakotan. We will look
    forward to your testimony.
        Senator Hutchison has asked me to let you know she has a
    conflict this morning and will not be able to attend this
    hearing, but I will submit her statement and questions for the
    record.
        [The statement follows:]

               Prepared Statement of Senator Kay Bailey Hutchison

        Good afternoon, Mr. Chairman. Thank you for holding this hearing
    today as we examine the President's budget request for military
    construction and family housing for the Department of the Army and the
    Department of the Air Force. I would also like to welcome our witnesses
    and guests: Mr. Hansen, Mr. Calcara, Major General Carpenter, General
    Boozer and Mr. Snyder. I look forward to discussing military
    construction and family housing needs with you.
        I am very pleased that we are nearing completion of the Base
    Realignment and Closure program. The Department is entering its final
    year of Milcon before the September 2011 statutory deadline for all
    BRAC projects. For the last several years, I have emphasized the
    importance of fully funding and effectively implementing the BRAC
    program, which has evolved into a $32 billion Milcon program for the
    Department.
        Mr. Hansen and General Boozer, as we begin the budget process for
    fiscal year 2011, the Department of the Army is facing several
    challenges within its military construction budget, such as changes to
    our Global Defense Posture, which we will discuss shortly, and changes
    to the Army's recapitalization strategy. As you have heard me say many
    times, I believe we should all strive to station as many of our troops
    as realistically possible within the United States, and in modern
    facilities we can all be proud of.
        Overall, the Department of the Army budget proposes a 9.7 percent
    increase, and the Department of the Air Force budget proposes a 7.2
    percent decrease. There are big differences in these accounts, and
    considering the big disparities in the Guard and Reserve accounts, I am
    anxious to discuss the rationale for these budget decisions. I want to
    be sure we are providing our soldiers, sailors, airmen, and marines
    with the infrastructure they and their families deserve.

                             GLOBAL DEFENSE POSTURE

        Another issue I hope to discuss today is our Global Defense Posture
    as it relates to our Milcon requirements. First, I hope our witnesses
    will explain the DOD policy of Building Partnership Capacity in Europe.
    I hope by partnership you mean that our allies will share in the
    financial burden as we build military infrastructure in Europe. Our
    specified overseas Milcon request is $2 billion for projects not
    directly related to the war in Afghanistan. When you add in projects
    for Afghanistan, overseas Milcon totals $4 billion. That is huge.
        As I have said many times, I believe we should be restationing our
    troops in the United States, but the proposed 2011 budget contains a
    Milcon request for $513 million for Germany, which includes $186
    million for Wiesbaden Army Base and $75 million for four new barracks
    at Grafenwoehr--a training facility--just as examples. As the services
    consolidate our forces in fewer facilities to save on operational
    costs, I know we have to build some new consolidated facilities, but I
    would like our witnesses today to give us the rationale behind these
    proposals and a sense that there is a strategy driving our Milcon
    requirements and not the other way around.
        In Korea, the Department is looking at ``tour normalization,''
    which would greatly increase the number of U.S. citizens on the
    peninsula and require expanding our support infrastructure in Korea. I
    understand that you are currently executing phase 1 of a 3-phase
    consolidation operation and that phases 2 and 3 will require more
    substantial U.S. funding. I look forward to your remarks concerning the
    costs of future infrastructure requirements and the Korean Government's
    financial contributions associated with this consolidation effort.

                        QUADRENNIAL DEFENSE REVIEW (QDR)

        The Quadrennial Defense Review recommends retaining four brigade
    combat teams in Europe, rather than the current stationing plan to
    reduce the number to two. I have raised this issue before with the
    Secretary of Defense and the Army Chief of Staff because I am concerned
    that this decision will disrupt our commitment to return our forces to
    the United States, where we can provide better training and a better
    quality of life for them and their families. I am concerned it will
    also disrupt the extensive military construction already in progress at
    Fort Bliss. The sooner we can get our service-men and -women home and
    into new, state-of-the-art facilities, the sooner we will live up to
    our commitment to provide for them in a way that is commensurate with
    their service to our Nation. Our troops can deploy to any region of the
    world from the United States just as easily as they can from Europe,
    and in some cases more so. We need to return our troops to the United
    States, but just as importantly, we need to be fiscally responsible
    when we decide on a strategy to do this.

                      ARMY NATIONAL GUARD AND ARMY RESERVE

        The services have always maintained that the Reserve components
    play a vital role in meeting our defense mission and in enabling us to
    manage the stress on the Active Force. The QDR calls them ``equal
    partners''. The fiscal year 2011 budget request reduces funding for the
    Army Reserve by 26 percent, the Air National Guard by 52 percent, and
    the Air Force Reserve by 93 percent. I do not recall the Air Force
    Reserve only receiving one project in the entire budget request. Every
    year Congress has to add programs to these accounts because the
    Department, in my opinion, does not fund them as robustly as it should.
    This is a challenge. I look forward to the Army's remarks concerning
    the impacts of these budgetary reductions.

                                    CLOSING

        The budget before us poses some challenges, but I do commend the
    Department of the Army for making quality of life a top priority. Even
    if we discuss different ways to best support our troops, we all have
    the same goal in mind and that is keeping our soldiers first.
        Thank you again Mr. Chairman for holding this hearing. I look
    forward to discussing these and other issues with our witnesses.

        Senator Johnson. The Army's 2011 budget request for Active
    and Reserve Military Construction and Family Housing, Base
    Realignment and Closing, and Overseas Contingency Operations is
    $7.9 billion. Included in this budget is a historically high
    funding request for the Army Guard, $873.7 million. I commend
    the Army for investing so heavily in the Guard and I hope you
    will bring the same commitment to the Army Reserve in future
    budget requests.
        This is also the final year to execute the 2005 BRAC
    program. I understand that the Army has several projects that
    could be at risk of missing the statutory deadline. I hope we
    will receive an update on the status of these projects.
        Last year, the subcommittee provided additional funding to
    expand the homeowners assistance program which I have a keen
    interest in. I hope that you will be able to update us on the
    progress of the program and let us know how well the funding is
    being executed.
        Secretary Hansen, I look forward to your opening statement,
    but before you begin, Senator Collins, would you care to make
    an opening statement?
        Senator Collins. Thank you, Mr. Chairman. You have
    explained that the ranking member, due to an unscheduled event,
    is unable to join you today. So I am very happy to act in her
    capacity as we review the fiscal year 2011 Milcon request for
    the Army and the Air Force. So I look forward to working with
    you. Thank you.
        Senator Johnson. Thank you, Senator Collins.
        Secretary Hansen, again I welcome you and your colleagues
    to this subcommittee. I understand that yours will be the only
    opening statement. Your prepared statement will be placed in
    the record, so I ask you to summarize your remarks to allow
    adequate time for questions. Secretary Hansen, please proceed.

                     SUMMARY STATEMENT OF HON. JERRY HANSEN

        Mr. Hansen. Thank you, Mr. Chairman. We will be brief.
        Chairman Johnson, Senator Collins, distinguished members of
    the subcommittee, I am Jerry Hansen, the designated senior
    official currently performing the duties of the Assistant
    Secretary of the Army for Installations and Environment. It is
    my pleasure to appear before you today on behalf of the
    Secretary of the Army to discuss the Army's fiscal year 2011
    military construction, base realignment and closure, and family
    housing budget requests.
        I would like to first thank you for your continued
    consistent support to our soldiers, families, and Army
    civilians serving the Nation across the globe. The Army's
    strength lies in the people who serve. We work with your ever-
    important support to ensure that we provide a quality of life
    commensurate with the quality of their service.
        I would also like to thank you for the legislative
    expansion of the housing assistance program. As the DOD
    executive agent for the program, I am pleased to report that in
    the first 6 months since the expanded HAP authority was
    implemented, we have paid benefits of over $125 million to more
    than 1,000 military families. The program has and will continue
    to save many families from financial ruin. Currently we believe
    we have enough funding on hand, but we do continue to see
    growth in eligible applicants.
        Our Milcon budget request for fiscal year 2011 represents
    the minimum level of funding required to provide the Army with
    the facilities needed to support the mission accomplishment
    while preserving an All-Volunteer Force. We remain an Army at
    war that continues its largest transformation since World War
    II. As we withdraw forces from Iraq, build up forces in
    Afghanistan, and then begin that drawdown as well, we are
    simultaneously completing transformation to a modular brigade-
    centric force, growing the Army and completing both global
    defense posture realignments and Base Realignment and Closure
    2005.
        In addition, we remain committed to our previously stated
    timelines of funding adequate barracks for all permanent party
    soldiers by fiscal year 2013 and trainees by fiscal year 2015
    with occupancy completed 2 years later.
        Our fiscal year 2011 budget request supporting these
    initiatives totals $7.9 billion across all components. This
    reflects an expected decrease in BRAC 2005 appropriation
    requirements of about $3 billion from that of last year, as we
    anticipated that fiscal year 2010 would be the final year of
    BRAC construction. The Army remains fully committed to meeting
    the BRAC timeline, intensely managing those remaining actions
    with tight construction schedules. Funds requested in fiscal
    year 2011 will be used units and personnel and to outfit our
    new facilities as they come on line. With full funding, we
    expect all actions to be completed on time without degradation
    of training or readiness, although we recognize that fourth
    quarter fiscal year 2011 will be extremely busy.
        Last year, you appropriated $30 million in additional
    military construction funding for both the Army Reserve and
    National Guard. We thank you for that initiative. The funds are
    being used to address critical requirements. Included in the
    overall fiscal year 2011 request is $874 million of military
    construction for the Army National Guard and $318 million for
    the Army Reserve. Collectively, this represents 149 percent
    increase from the fiscal year 2010 request for our reserve
    components, a very significant increase for the Guard, but a
    slight decrease, as you indicated, for the Army Reserve. This
    is balanced, however, by an increase in our sustainment,
    restoration, and modernization funding for the Reserves. This
    funding will ensure that the Guard and Reserve are able to
    continue transformation to operationalized forces. I cannot
    overstate how important the readiness and availability of our
    reserve components remains to our national defense.
        Another high priority for fiscal year 2011 is energy
    security and implementing energy efficiencies in facility
    construction. As stewards of a significant portion of our
    national resources, the Army requires that new military
    construction projects attain a minimum of leadership in energy
    and environmental design, Lead Silver standards, that we
    achieve compliance with energy efficiency mandates and we
    incorporate smart building technologies where cost effective.
        In addition, water conservation is being pursued through a
    comprehensive program which includes water management plans,
    adoption of best management practices, establishment of
    waterless urinals as a standard in new Army construction,
    increased metering, and improved asset management of water
    distribution systems. We take energy conservation very
    seriously and continue to look for ways to implement innovative
    energy initiatives.
        Finally, I would like to address the concerns of the
    subcommittee regarding the return of two brigade combat teams
    from Europe to the United States. Currently, the Army cannot
    provide specific plans for the BCTs as we await guidance from
    the Secretary of Defense on the strategic posture in Europe.
    This guidance will allow the Army to review current plans for
    returning these brigades to the United States and make any
    adjustments that might be required. None of these projects in
    our fiscal year 2011 request are planned to support keeping
    brigades in Europe. There will be minimal impact to State-side
    projects should the decision be made to keep one or both
    brigades in Europe. Once the decision is made, our out-year
    military construction programs will be adjusted accordingly.
        I am accompanied today by Mr. Joe Calcara, the Deputy
    Assistant Secretary of the Army for Installations and Housing;
    Brigadier General Jim Boozer, Director of Operations from the
    Office of the Assistant Chief of Staff for Installation
    Management; Major General Ray Carpenter, Acting Director, Army
    National Guard; and Mr. James Snyder, Assistant Chief of the
    Army Reserve.

                               PREPARED STATEMENT

        We thank you again for the opportunity to appear before you
    this morning and for your continued support to the Army, and we
    look forward to your questions.
        [The statement follows:]

      Prepared Statement of Hon. Jerry Hansen; Joseph F. Calcara; General
        James C. Boozer; General Raymond W. Carpenter; and James Snyder

        Mr. Chairman and members of the subcommittee, on behalf of the more
    than 1 million Active, Guard, and Reserve soldiers, their families, and
    the civilians of the United States Army, I welcome the opportunity to
    discuss the Army's Military Construction, Family Housing, and Base
    Realignment and Closure budget requests for fiscal year 2011.
        The Army's strength is its soldiers--and the families and Army
    civilians who support them. I would like to start by thanking you for
    your support to our soldiers and their families serving our Nation
    around the world. They are and will continue to be the centerpiece of
    our Army, and their ability to perform their missions successfully
    depends upon the staunch support of the Congress.
        Our Nation has been at war for nearly 9 years. The Army continues
    to lead the war efforts in Afghanistan and Iraq, as well as in defense
    of the homeland and in support of civil authorities in responding to
    domestic emergencies. Over time, these operations have expanded in
    scope and duration, stressing our All-Volunteer Force and straining our
    ability to maintain strategic depth. During this period, the Congress
    has responded to the Army's requests for resources, and that commitment
    to our soldiers, their families, and civilians is deeply appreciated.
    Continued timely and predictable funding is critical as the Army
    continues to fight two wars, meet other operational demands, sustain an
    All-Volunteer Force, and prepare to protect against future threats to
    the Nation.

                                    OVERVIEW
                          FACILITIES STRATEGIC CONTEXT

        The Army continues its largest organizational change since World
    War II, as it transforms to a Brigade centric modular force and grows
    the force to achieve an Active component end strength of 547,400, a
    National Guard end strength of 358,200, and an Army Reserve end
    strength of 206,000 soldiers. At the same time, we are restationing
    about one-third of the force through a combination of Base Closure and
    Realignment (BRAC) and Global Defense Posture Realignment (GDPR)
    actions.
        The Army is executing a tightly woven, operationally synchronized
    plan integrating BRAC, GDPR, and Grow the Army (GTA); facilitated by
    Military Construction. The strategy includes aligning facilities to
    support a CONUS based Army Modular Force (AMF) structured expeditionary
    Army; completing facilities to implement and comply with BRAG 2005 law
    by 2011; completing GDPR by 2013; completing GTA by 2013; and
    completing AMF new unit facilities builds. Facilities modernization for
    AMF units converted from the legacy force structure extends beyond
    2015.

                   ARMY IMPERATIVES AND FACILITY INITIATIVES

        The fiscal year 2011 Milcon request is crucial to the success of
    the Army's strategic imperatives to sustain, prepare, and transform the
    force. The Army has developed military construction facility
    initiatives that support the Army imperatives.
    Sustain
        To sustain the force, the following initiatives provide for the
    recruitment and retraining of soldiers; care of soldiers, families, and
    civilians; care of wounded warriors; and the support of families of
    fallen comrades:
        Family Housing.--Provides housing services, preserves the balance
    of military owned housing and the distinction of privatized on-post
    housing commensurate with U.S. civilian community standards.
        Barracks.--Provide quality barracks for Army soldiers including:
    permanent party, training, and warriors transition complexes. We owe
    single soldiers the same quality of housing that we provide married
    soldiers. Modern barracks are shown to significantly increase morale,
    which positively impacts readiness and quality of life across all
    components. The Army intends to buyout the original inadequate
    permanent party barracks by 2013 with full occupancy by 2015, and will
    continue to budget to maintain all permanent party barracks as
    adequate.
        Army Medical Action Plan.--Provide command and control, primary
    care and case management for Warriors in Transition (WT) to establish a
    healing environment that promotes the timely return to the force or
    transition to civilian life.
        Soldier Family Action Plan.--Provides soldiers and families a
    quality of life commensurate with their service; provides families a
    strong, supportive environment where they can thrive; and provide
    quality, standardized facilities.
    Prepare
        To Prepare our Army to meet the challenges of the current
    operations and the full spectrum of combat operations, the Army has
    funded projects in the Grow the Army, Mission and Training, and Trainee
    Barracks initiatives.
        Grow the Army.--Provide facilities to support the increase of the
    Army end strength to 1,111.6K (74.2K increase) across all components to
    fill key force capability shortfalls and increase Active component
    dwell time. GTA facilities include operations, maintenance, and
    training facilities; barracks, and facilities to improve the quality of
    life for soldiers, families, and civilians in the Active Army, Army
    Reserve and Army National Guard. The Army's strategy is to complete all
    facilities requirement to support this initiative by fiscal year 2013.
        Mission and Training.--Provides facilities to support unit
    operations, maintenance, and training. Ranges and training land to
    support individual, and unit collective training in support of the Army
    Force Generation (ARFORGEN) training cycle are included in Mission and
    Training facilities.
        Training Barracks.--Provides initial entry and advance individual
    training quality barracks and eliminates all inadequate trainee
    barracks spaces. The goal is to fund all trainee barracks requirements
    by fiscal year 2015 and full occupancy of the barracks in fiscal year
    2017.
        Operational Readiness Training Complex.--Fiscal year 2011 is the
    start of the Army's investment in unit facilities in support of the
    ARFORGEN training cycles of the Active and Reserve components. ORTCs
    are complexes with operations, maintenance and storage facilities,
    barracks, dining facility, and equipment parking.
    Transform
        To meet the demands of the 21st century, the Army is transforming
    via the AMF, GDPR, and BRAC initiatives. Collectively, these
    initiatives allow the Army to shape and station forces to provide
    maximum flexibility.
        Army Modular Force.--The Army continues to reorganize the Active
    and Reserve components into standardized modular organizations,
    increasing the number of Brigade Combat Teams (BCTs) and support
    Brigades to meet operational requirements and create a more deployable,
    versatile and tailorable force.
        Global Defense Posture Realignment.--The GDPR initiative ensures
    Army Forces are properly positioned worldwide to support our National
    Military Strategy and to support the mission in Afghanistan. GDPR will
    relocate over 48,000 soldiers and their families from Europe and Korea
    to the United States by 2013. As part of the fiscal year 2011 program,
    the Army is requesting $188.7 million to construct facilities in
    Bagram, Afghanistan, and Forts Benning, Bliss, and Riley.
        Base Realignment and Closure.--BRAC 2005 enables the Army to
    reshape the infrastructure supporting the operating force, the
    generating force, the Reserve component and enhance the repositioning
    of those forces making them more relevant and combat ready for the
    Combatant Commander.

                        FISCAL YEAR 2011 MILCON OVERVIEW

        The Army's fiscal year 2011 Military Construction and Overseas
    Contingency Operations budget requests include $7.9 billion for
    Military Construction, Army Family Housing, and BRAC appropriations and
    associated new authorizations.
        The details of the Army's fiscal year 2011 request follow:

    ----------------------------------------------------------------------------------------------------------------
                                                                               Authorization of
             Military construction authorization             Authorization      appropriations       Appropriation
                                                                request             request             request
    ----------------------------------------------------------------------------------------------------------------
    Military Construction Army (MCA)....................      $3,665,662,000      $4,078,798,000      $4,078,798,000
    Military Construction Army National Guard (MCNG)....         836,601,000         873,664,000         873,664,000
    Military Construction Army Reserve (MCAR)...........         289,275,000         318,175,000         318,175,000
    Army Family Housing Construction (AFHC).............          55,329,000          92,369,000          92,369,000
    Army Family Housing Operations (AFHO)...............  ..................         518,140,000         518,140,000
    BRAC 95 (BCA).......................................          73,600,000          73,600,000          73,600,000
    BRAC 2005 (BCA).....................................       1,012,420,000       1,012,420,000       1,012,420,000
    Overseas Contingency Operations (OCO)...............         761,950,000         929,996,000         929,996,000
    Homeowners Assistance Program (HAP).................          16,515,000          16,515,000          16,515,000
                                                         -----------------------------------------------------------
          TOTAL.........................................       6,711,352,000       7,913,677,000       7,913,677,000
    ----------------------------------------------------------------------------------------------------------------

                        FISCAL YEAR 2011 BUDGET REQUEST
                          MILITARY CONSTRUCTION, ARMY

        The Active Army fiscal year 2011 Military Construction request for
    $4,078,798,000 (for appropriation and authorization of appropriations)
    supports the Army Imperatives of Sustain, Prepare and Transform.
        Mission and Training ($866 million).--Operations, maintenance, and
    training facilities and ranges are the cornerstones to ``Prepare'' the
    Army for current operations. The fiscal year 2011 request includes $269
    million for operations facilities, $65 million for maintenance
    facilities, $212 million for ranges and $213 million for training
    facilities. Utilities and other support facilities complete the mission
    and training request at $107 million.
        Army Modular Force (1,268 million).--The fiscal year 2011 request
    of $1.584 billion will provide permanent operations and maintenance
    facilities and barracks to support the conversion of existing forces
    into new modular force units in the Active Army (1.268 billion) and
    Army National Guard (0.316 billion). The Army strategy is to use
    existing facility assets where feasible and program new construction
    projects when existing facilities are inadequate.
        Grow the Army ($698 million).--The Grow the Army request in fiscal
    year 2011 is for 34 projects. The total includes $148.7 million for
    maintenance facilities, $215.4 million for operations facilities, $259
    million for Barracks, and $74.6 million for training ranges and
    training support facilities. The Army's gap analysis for Grow the Army,
    following the fiscal year 2009 Secretary of Defense decision on the
    number of Brigades, confirmed that these facilities were essential to
    support growth in the Army's combat support and combat service support
    force structure and establish the appropriate training support
    infrastructure.
        Barracks Modernization ($891 million).--The Army is in the 18th
    year of modernizing permanent party barracks to provide about 148,000
    single enlisted soldiers with quality living environments. Because of
    increased authorized strength, the requirements for barracks
    modernization have increased in several locations. The fiscal year 2011
    request will provide for 5,115 new permanent party barracks spaces that
    will meet DOD's ``1+1'' or equivalent standard and eliminate common
    area latrines. These units provide two-soldier suites, increased
    personal privacy, larger rooms with walk-in closets, new furnishings,
    adequate parking, landscaping, and unit administrative offices
    separated from the barracks. The $891 million in barracks projects
    includes projects requested in the GTA, GDPR, and AMF initiatives. We
    are on track to fully fund this program by fiscal year 2013. The last
    inadequate permanent party spaces will be removed after the new
    barracks are fully occupied in fiscal year 2015.
        Trainee Barracks Modernization ($191 million).--The $350 million
    provided by the Congress in the 2010 appropriations for trainee
    barracks is greatly appreciated. The additional funding will accelerate
    the Army's ability to provide necessary quality barracks. The request
    in fiscal year 2011 will provide 1980 new training barracks spaces for
    our soldiers. Six trainee barracks are going to be constructed at four
    installations (Forts Benning, Bragg, Jackson, and Leonard Wood).
        Warrior in Transition ($18 million).--The WT complex at Fort Eustis
    completes the Army's plan for WT complexes in the United States.
        Overseas Construction.--Included in this budget request are high-
    priority overseas projects at enduring locations. In Germany, we are
    requesting funds for barracks at Grafenwoehr and Rhine Ordnance, a
    vehicle maintenance shop and a physical fitness center in Ansbach, an
    information processing center, sensitive compartmented information
    facility, command and battle center and an access control point in
    Wiesbaden. In Korea, we are requesting funds to further our relocation
    of forces on the peninsula. This action is consistent with the Land
    Partnership Plan agreements entered into by the United States and
    Republic of Korea Ministry of Defense. Our request for funds in Italy
    continues construction for a BCT.
        Other Support Programs ($273 million).--The fiscal year 2011 budget
    includes $222 million for planning and design. As executive agent, the
    Army also provides oversight of design and construction for projects
    funded by host nations. The fiscal year 2011 budget requests $28
    million for oversight of host nation funded construction for all
    Services in Japan, Korea, and Europe. The budget request also contains
    $23 million for unspecified minor construction to address unforeseen
    critical needs or emergent mission requirements that cannot wait for
    the normal programming cycle.
        Incremental Funding ($140 million).--We are requesting the second
    increment of funding, $59.5 million, for the Command and Battle Center
    at Wiesbaden, Germany. In addition, we are requesting the first phase,
    and second increment of funding, $30 million, for the Aviation Task
    Force Complex at Fort Wainwright, Alaska. The budget also includes $25
    million for a Brigade Complex-Operations support facility and $26
    million for a Brigade Complex-Barracks/Community, both projects at
    Vicenza, Italy.

                     MILITARY CONSTRUCTION, NATIONAL GUARD

        The fiscal year 2011 request for $873,664,000 (for appropriation
    and authorization of appropriations) is focused on Army Modular Force,
    Mission and Training, Grow the Army, planning and design and
    unspecified minor military construction represents the largest Milcon
    budget ever requested by the Army National Guard.
        Mission and Training.--In fiscal year 2011, the Army National Guard
    is requesting $440.5 million for 24 projects which will support the
    preparation of our forces. These funds will provide the facilities our
    soldiers require as they train, mobilize, and deploy. Included are four
    Training/Barracks Facilities, nine Range projects, four Maintenance
    Facilities, one United States Property and Fiscal Facility, and six
    Readiness/Armed Forces Reserve Centers.
        Army Modular Force.--Our budget request also includes $316.5
    million for 16 projects in support of our modern missions. There are
    five Readiness Centers, one Armed Forces Reserve Center, five
    Maintenance Facilities, four Unmanned Aircraft System Facilities and
    one Aircraft Parking project to provide for modernized facilities.
        Grow the Army.--To support the Army National Guard end strength
    increase, $79.6 million is requested to construct eight Readiness
    Centers. The new Readiness Centers will house newly activating units to
    address the continued high levels of force deployment.
        Other Support Programs.--The fiscal year 2011 Army National Guard
    budget also contains $25.6 million for planning and design of future
    projects and $11.4 million for unspecified minor military construction
    to address unforeseen critical needs or emergent mission requirements
    that cannot wait for the normal programming cycle.

                      MILITARY CONSTRUCTION, ARMY RESERVE

        The Army Reserve fiscal year 2011 Military Construction request for
    $318,175,000 (for appropriation and authorization of appropriations) is
    for Preparation, Transformation, other support, and unspecified
    programs.
        Mission and Training Projects.--In fiscal year 2011, the Army
    Reserve will invest $76.5 million to prepare our soldiers for success
    in current operations. Included in the mission and training projects
    are, four ranges, a tactical vehicle wash rack, a maintenance and
    equipment storage facility and an Annual Training/Mobilization Barracks
    Grow The Army. The Army Reserve transformation from a strategic reserve
    to an operational force includes converting 16,000 authorizations from
    generating force structure to operational force structure from fiscal
    years 2009 through 2013. In fiscal year 2011, the Army Reserve will
    construct 17 Reserve operations complexes in 11 States, with an
    investment of $212.8 million to support the transformation. These
    projects will provide operations, maintenance, and storage facilities
    for over 3,300 soldiers in 66 newly activating combat support and
    combat service support units and detachments.
        Other Unspecified Programs.--The fiscal year 2011 Army Reserve
    budget request includes $25.9 million for planning and design for
    future year projects and $3.0 million for unspecified minor military
    construction to address unforeseen critical needs or emergent mission
    requirements that cannot wait for the normal programming cycle.

                        ARMY FAMILY HOUSING CONSTRUCTION

        The Army's fiscal year 2011 family housing construction request is
    $92.4 million for authorization of appropriation, and appropriation.
    This year's budget continues our significant investment in our soldiers
    and their families by supporting our goal to continue funding to
    sustain military-owned housing and eliminate remaining inadequate
    military-owned at enduring overseas installations.
        The fiscal year 2011 new construction program uses traditional
    military construction to provide 64 new homes for families with a $34.3
    million replacement project at Baumholder, Germany. The Army also
    requests $21 million for the completion of the supporting
    infrastructure for two projects authorized and appropriated in fiscal
    year 2004 at Fort Wainwright, Alaska.
        The fiscal year 2011 construction program also provides $35 million
    to make adjustments to two existing Residential Communities Initiative
    (RCI) family housing privatization projects at Fort Eustis, Virginia
    and Carlisle Barracks, Pennsylvania.
        In fiscal year 2011, we are also requesting $2.0 million for final
    design of fiscal year 2011 family housing projects and to initiate
    design of 2012 family housing construction projects, as well as for
    housing studies and updating standards and criteria.
        Privatization.--The Residential Communities Initiative (RCI), the
    Army's housing privatization program, continues to provide quality
    housing which soldiers and their families can proudly call home. The
    Army is leveraging appropriated funds and existing housing by engaging
    in 50-year partnerships with nationally recognized private real estate
    development, property management, and home builder firms to construct,
    renovate, repair, maintain, and operate housing communities.
        The RCI program will include 44 locations, with a projected end
    state of over 85,000 homes--98 percent of the on-post family housing
    inventory in the United States. At the end of fiscal year 2010, the
    Army will have privatized all 44 locations. Initial construction and
    renovation at these 44 installations is estimated at $12.6 billion over
    a 3- to 14-year initial development period, of which the Army will
    contribute close to $2.0 billion. Although most projects are in their
    initial development periods, since 1999 through November 2009, our
    partners have constructed over 21,000 new homes, and renovated another
    16,000 homes.

                         ARMY FAMILY HOUSING OPERATIONS

        The Army's fiscal year 2011 Family Housing Operations request is
    $518,140,000 (for appropriation and authorization of appropriations).
    This account provides for annual operations, municipal-type services,
    furnishings, maintenance and repair, utilities, leased Family housing,
    demolition of surplus or uneconomical housing, and funds supporting
    management of the Military Housing Privatization Initiative. This
    request will support almost 17,000 Army-owned homes, at home and in
    foreign countries areas, as well as leasing more than 9,000 residences
    and providing government oversight of more than 80,000 privatized
    homes.
        Operations ($97.3 million).--The operations account includes four
    sub-accounts: management, services, furnishings, and a small
    miscellaneous account. All operations sub-accounts are considered
    ``must pay accounts'' based on actual bills that must be paid to manage
    and operate Lily housing.
        Utilities ($69.6 million).--The utilities account includes the
    costs of delivering heat, air conditioning, electricity, water, and
    wastewater support for family housing units. The overall size of the
    utilities account is decreasing with the reduction in supported
    inventory.
        Maintenance and Repair ($120.9 million).--The maintenance and
    repair account supports annual recurring projects to maintain and
    revitalize family housing real property assets. Since most family
    housing operational expenses are fixed, maintenance and repair is the
    account most affected by budget changes. Funding reductions result in
    slippage of maintenance projects that adversely impact soldier and
    family quality of life.
        Leasing ($203.2 million).--The leasing program provides another way
    of adequately housing our military Families. The fiscal year 2011
    budget includes funding for 9,036 housing units, including project
    requirements for 1,080 existing section 2835 (``build-tolease''--
    formerly known as 801 leases), 1,828 temporary domestic leases in the
    United States, and 6,128 leased family housing units in foreign areas.
        Privatization ($27.1 million).--The privatization account provides
    operating funds for management and oversight of privatized military
    family housing in the RCI program. RCI costs include civilian pay,
    travel, and contracts for environmental and real estate functions,
    training, real estate and financial consultant services and oversight
    to monitor compliance and performance of the overall privatized housing
    portfolio and individual projects.

                                    BRAC 95

        Since Congress established the first Defense Base Closure and
    Realignment Commission in 1988 and then authorized the subsequent
    rounds in 1990, DOD has successfully executed four rounds of base
    closures to reduce and align the military's infrastructure to the
    current security environment and force structure. As a result, the Army
    estimates approximately $13.5 billion in savings through 2009--and
    nearly $1 billion in recurring, annual savings from prior BRAG rounds.
        The Army is requesting $73.6 million in fiscal year 2011 for prior
    BRAG rounds ($5.2 million to fund caretaking operations and program
    management of remaining properties and $68.4 million for environmental
    restoration) to address environmental restoration efforts at 147 sites
    at 14 prior BRAG installations. To date, the Army has spent $3.1
    billion on the BRAC environmental program for installations impacted by
    the previous four BRAC rounds. The Army has disposed of 183,637 acres
    (88 percent of the total acreage disposal requirement of 209,292
    acres), with 25,654 acres remaining.

                                   BRAC 2005

        Under BRAG 2005, the Army will close 12 Active component
    installations, one Army Reserve installation, 387 National Guard
    Readiness and Army Reserve Centers, and eight leased facilities. BRAG
    2005 establishes Training Centers of Excellence, joint bases, a Human
    Resources Center of Excellence, and joint technical and research
    facilities. To accommodate the units relocating from the closing
    National Guard Readiness and Army Reserve Centers, BRAG 2005 creates
    125 multi-component Armed Forces Reserve Centers and realigns U.S. Army
    Reserve Command and control structure.
        With over 1,100 discrete actions required for the Army to
    successfully implement BRAC 2005, they must be carefully integrated
    with the Defense and Army programs of Grow the Army, GDPR, and Army
    Modular Force. Collectively, these initiatives allow the Army to focus
    its resources on installations that provide the best military value,
    supporting improved responsiveness and readiness of units. The
    elimination of cold war-era infrastructure and the implementation of
    modern technology to consolidate activities allow the Army to better
    focus on its core warfighting mission. These initiatives are a massive
    undertaking, requiring the synchronization of base closures,
    realignments, military construction and renovation, unit activations
    and deactivations, and the flow of forces to and from current global
    commitments. Results will yield substantial savings over time, while
    positioning forces, logistics activities, and power projection
    platforms to respond efficiently and effectively to the needs of the
    Nation.
        The Army fiscal year 2011 budget request for BRAC 2005 is $1,012.4
    million. The Army remains committed to achieving BRAG 2005 Law and is
    on track to do so. Our request is critical to the success of the Army's
    BRAC 2005 initiative and does not contain funding for new construction
    projects. The funding request includes $887.2 million in Operations and
    Maintenance (O&M) to support Civilian Permanent Change of Station
    (PCS), furnishings and equipment for completed BRAC projects, as well
    as support for facility caretaker requirements. An additional $51.7
    million is requested for information technology and capital equipment
    procurement to comply with the BRAG 2005 requirements.
        In fiscal year 2011, the Army will continue environmental closure
    and cleanup actions at BRAG properties. These activities will continue
    efforts previously ongoing under the Army Installation Restoration
    Program and will ultimately support future property transfer actions.
    The budget request for environmental programs is $73.5 million, which
    includes munitions and explosives of concern and hazardous and toxic
    waste restoration activities.

                        OVERSEAS CONTINGENCY OPERATIONS

        The fiscal year 2011 request includes $930 million to support
    Overseas Contingency Operations (OCO). The request funds non enduring
    mission projects critical to the support of deployed war fighters for
    example: troop housing, dining facilities, rotary wing airfield
    facilities, logistical and environmental facilities, command and
    control facilities, and force protection to ensure safe and efficient
    military operations in Afghanistan. A total of 48 projects fulfill the
    Department's immediate mission needs and urgent infrastructure
    requirements in theater for a total of $762 million. The OCO request
    provides $78.3 million for unspecified minor construction and $89.7
    million for planning and design.

                         HOMEOWNERS ASSISTANCE PROGRAM

        The Army is the DOD Executive Agent for the Homeowners Assistance
    Program (HAP); that is, the Army requests in its budget the funds
    needed by the DOD-wide program supporting all of the services. In
    normal times, this program assists eligible military and civilian
    employee homeowners by providing some financial relief when they are
    not able to sell their homes under reasonable terms and conditions
    because of DOD announced closures, realignments, or reduction in
    operations when this action adversely affects the real estate market.
        The fiscal year 2011 budget requests authorization of
    appropriations in the amount of $16.5 million. Total program estimate
    for fiscal year 2011 is $49.9 million and will be funded with requested
    budget authority, revenue from sales of acquired properties, and prior
    year unobligated balances.

                                    SUMMARY

        Mr. Chairman, the fiscal year 2011 Military Construction and BRAC
    budget requests are balanced programs that support our soldiers and
    their families, overseas contingency operations, Army transformation,
    readiness, and DOD installation strategy goals. We are proud to present
    this budget for your consideration because of what this budget will
    provide for the Army.
    Military Construction:
      --$7.9 billion invested in soldier/family readiness;
      --$930 million to support projects for overseas contingency
            operations;
      --$4,079 million to Active Army;
      --$318 million to Army Reserve;
      --$874 million to Army National Guard;
      --$610 million to family housing;
      --39 new training ranges/facilities;
      --37 new Reserve and National Guard operations and readiness centers;
      --245 families get new or improved housing;
      --8,857 soldiers get new barracks.
    Base Realignment and Closure:
      --$1,012 million to support BRAC 2005;
      --Statutory compliance by 2011 for BRAC 2005;
      --Continued environmental restoration and disposal of excess acres.
        Our long-term strategies for installations will be accomplished
    through sustained and balanced funding, and with your support, we will
    continue to improve soldier and family quality of life, while remaining
    focused on Army and Defense transformation goals.
        In closing, we would like to thank you again for the opportunity to
    appear before you today and for your continued support for America's
    Army.

                      HOMEOWNERS ASSISTANCE PROGRAM (HAP)

        Senator Johnson. Mr. Calcara, I will start with you.
    Department of Transportation has proposed legislative changes
    to the HAP language. Can you explain the reasons for the
    change?
        Mr. Calcara. Sir, are you referring to the start date for
    the program of July 2006? Is that the legislative change you
    are referring to? I am not aware of the exact DOT request.
        Senator Johnson. That is DOT and its short sales.
        Mr. Calcara. Short sales. Sir, I am unaware of the request.
    Could you provide me some clarity on the request, and I could
    perhaps----
        Senator Johnson. Yes, I can.
        Has the Secretary made a decision to terminate the
    temporary expansion of HAP on September 30, 2010, and if so,
    why?
        Mr. Calcara. Oh, okay. Yes. Sir, as you know, when we
    started the program, we had a specific amount of resources that
    we were given to work across three elements of the program, one
    being BRAC, one being Wounded Warriors, one being permanent
    change of station (PCS). Initially, to ensure that we had
    enough resources available for the BRAC migration which would
    occur down the line, we set aside some funding for that. The
    remaining dollars allowed us to implement the program for the
    PCS, for the permanent change of station, portion on a 1-year
    basis.
        As we have now got into the program and we are looking at
    affordability, it does appear that we will be able to extend
    it. So currently we have extended it through the calendar year,
    and depending on how much funding is available after we pay
    through those quarters, we would again continue it another
    year. That would be our approach.
        So I do not know as we would need legislation to do that.
    We have the flexibility in the program to do it without the
    legislation. We certainly would support it. It has always been
    our intent to cover as many PCS applications as we can. It is
    just we are trying to make sure we have enough money left for
    the BRAC portion which is coming down the line in the next 18
    months.

                                ENERGY SECURITY

        Senator Johnson. Secretary Hansen, energy security on bases
    is a major. What is the Army doing to protect critical mission
    assets from the threat of extended disruptions to the
    commercial power grid?
        Mr. Hansen. Thank you, Mr. Chairman. The Army has $98.7
    million programmed in fiscal year 2011 for installation,
    facility, energy security initiatives, for example, utilities
    modernization, advanced metering, renewable energy project
    development, comprehensive energy and water management, and
    energy security planning. That planning includes working very
    closely with the critical infrastructure protection people to
    ensure that we are putting a high priority on securing those
    facilities and those portions of the facilities.
        In the Milcon area for new construction, approximately 2
    percent of the cost is devoted to energy efficiency additions
    which address EPAct 2005 goals, plus the standard to design the
    Lead Silver. With restoration and modernization funding, we are
    incorporating metering for large projects and attempt, where
    impossible, to include other energy security initiatives,
    features such as motion sensor lights, solar street lights, LED
    lighting, and additional insulation. With future years defense
    program (FYDP) 2012 to 2017, this will be the first POM cycle
    in which we have been able to address comprehensively energy
    security initiatives identified in our newly approved Army
    energy security implementation strategies. We will have much
    more to come with fiscal year 2012, sir.
        Senator Johnson. Secretary Hansen, could you provide the
    subcommittee with a list of potential unfunded Energy
    Conservation Investment Program (ECIP) projects that could be
    executed in fiscal year 2011?
        Mr. Hansen. Yes, sir, we will.
        [The information follows:]

        The following is a list of unfunded ECIP project that could be
    executed in fiscal year 2011:

    --------------------------------------------------------------------------------------------------------------------------------------------------------
                      Region                                 Installation                 DD 1391                     Title                       Amount
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    NERO.....................................  Letterkenny AD.........................        75934  Solar Walls............................      $1,100,000
    PARO.....................................  Ft Wainwright..........................        76006  Improve Motors.........................       3,200,000
    SERO.....................................  Ft Bragg...............................        78034  Retrocommissioning Barracks, HQs,             7,200,000
                                                                                                      others.
    SERO.....................................  Redstone Arsenal.......................        76139  Solar Walls............................       1,582,000
    ARNG.....................................  Sea Girt, NJ...........................        77795  PV Solar System........................       5,600,000
    SERO.....................................  Ft Knox................................        67393  Photovoltaic, Phase 1..................       6,100,000
    NERO.....................................  Ft Drum................................        75514  Retrocommissioning 27 buildings........       3,650,000
    WEST.....................................  Ft Bliss...............................        77029  Install Microgrid......................       5,600,000
    WEST.....................................  Ft Bliss...............................        76085  Solar Daylighting......................       2,250,000
    WEST.....................................  Ft Bliss...............................        76083  Solar Power Facility...................       4,750,000
    WEST.....................................  Ft Bliss...............................        76082  Solar Power Facility...................       2,450,000
    WEST.....................................  Ft Bliss...............................        76048  Solar Facility.........................       1,200,000
    WEST.....................................  Ft Bliss...............................        76034  Power Facility.........................       2,400,000
    WEST.....................................  Ft Bliss...............................        76031  Solar Power Facility...................       4,050,000
                                                                                                                                             ---------------
          TOTAL..............................  .......................................  ...........  .......................................      51,132,000
    --------------------------------------------------------------------------------------------------------------------------------------------------------

        Senator Johnson. Secretary Hansen, the Army like all of the
    services, has experienced large bid savings over the past 2
    years due to a competitive bid climate. What is the average
    percent of bid savings on the fiscal year 2010 projects that
    have been awarded to date, and what has been the projected
    level of bid savings for the fiscal year 2011 program if the
    bidding climate continues to be favorable?
        Mr. Hansen. I know we have had significant savings in some
    areas, but it has been somewhat erratic, sir. If I may defer to
    Mr. Calcara, I believe he has more detailed information on
    that.
        Mr. Calcara. Sir, we have currently executed about 40
    percent of the program and we are averaging anywhere between 10
    and 25 percent depending on the location. Savings, of course,
    are very centric to the market and the type of construction and
    where we are doing the work.
        I would tell you this that I think if the current bid
    climate holds the way it has through the first 6 months of the
    year--we have two taxes that we are paying. One is a tax that
    came out of the fiscal year 2010 appropriation. It is about
    $230 million, I believe, for the Army that we have to source
    out of that savings. The other one was dollars that were
    assessed to us from a GAAP analysis process that was done from
    the fiscal year 2009 program. We owe about $160 million on
    that.
        So what we are trying to do is harvest the savings we have
    against the dollars we have captured so far to pay those two
    taxes, and then there would be some dollars left over. I know
    you are looking for a number from me. I think there will be
    some savings, but it will not be 10 or 15 percent of the total
    program amount because of those taxes.
        Senator Johnson. Senator Collins.
        Senator Collins. Thank you, Mr. Chairman.

                            BRAC PROPERTY CONVEYANCE

        Secretary Hansen, last year I was among those members who
    worked very hard to put new authority in the defense
    authorization bill for the military to look at no or low-cost
    conveyances for economic development purposes of BRAC-related
    property. Has the Army used that new authority yet?
        Mr. Hansen. Yes, ma'am. We began reviewing all of our
    conveyances immediately upon receipt of that new authority. I
    am happy to say that it has given us a lot of flexibility to
    move more quickly and to create more win-win situations. A case
    in point is the Kansas Army ammunition plant that we are trying
    to finalize this year, and we are doing a revenue sharing plan
    with them for fiscal years 2006 through 2010 with the potential
    of $3.5 million coming back to the Army if they are successful
    and achieve their desired outcomes. Everyone is very enthused
    about this additional flexibility now, and I think it will
    allows us to dispose of properties more quickly with much more
    favorable results.
        Thank you, ma'am.
        Senator Collins. Thank you. I am delighted to hear that.
        General Carpenter, let me start by thanking you for coming
    to Maine last week. I have heard from the employees at the
    Maine Military Authority, as well as the Maine troop greeters,
    how pleased they were that you came firsthand to thank the
    troop greeters who have welcomed back or sent off more than a
    million members of our Armed Forces over the past few years.
        Also, I was delighted that you came to see the capabilities
    of the Maine Military Authority in Limestone in northern Maine.
        Could you share with the subcommittee your professional
    opinion of the capabilities of the Maine Military Authority?
        General Carpenter. First of all, Senator, let me tell you
    what an honor and a privilege it was to accompany you up to
    Maine the other day. The pride that you have in the State of
    Maine and specifically the Maine Military Authority and the
    troop greeters for what they do up there was very obvious, and
    I appreciate your support for the National Guard across the
    board. So thank you very much, Senator.
        Senator Collins. Thank you.
        General Carpenter. We are looking at our visit the other
    day, and it was a great opportunity for me to see what the
    Maine Military Authority is all about because I had not visited
    that particular facility before. As they very eloquently
    outlined, they have more capability than what is being used up
    there, and we are really taking a long look at how we parcel
    out work to that particular effort up there, and I think there
    are some opportunities to expand what is going on up there in
    the Maine Military Authority.
        As I mentioned when I was up there, our effort here is to
    be a good steward of the taxpayers' dollar, and what we get
    from the Maine Military Authority is absolutely a top product
    for a very good price. So it only makes sense for us, to the
    extent that we can, to utilize that particular effort up there
    and to maximize the capacity.
        I would also like to say it was a very humbling experience
    to get a chance to see the troop greeters the other day. There
    were almost 75 people there and they ranged in age from high
    school kids to World War II veterans. It was very impressive.
    They have met every airplane since Desert Storm that has come
    back from theater, and you can also see how proud they are of
    that.
        So, again, I think we have got some opportunities in the
    Maine Military Authority, and again, it was a great privilege
    to accompany you the other day.
        Senator Collins. Thank you, General. We were very honored
    to have you in our State.
        General Boozer, I understand that you are also taking a
    look at the Maine Military Authority. Are you working to
    identify possible opportunities where the Maine Military
    Authority might be able to assist the Army in its needs?
        General Boozer. Yes, Senator Collins, thanks for the
    question.
        Based on some of the feedback that I have received, I think
    I need to make a trip up there to take a look at that facility
    that General Carpenter just described.
        Senator Collins. We would welcome you anytime.
        General Boozer. I believe you know that Army Materiel
    Command CCOM already has a recapitalization program for some of
    our HMMWV's, our shelter-carrying HMMWV's, and that is about a
    $7 million a year program. But Army Materiel Command is also in
    discussions with MMA about a potential for them to compete in
    their expanding wheel assembly program. So that has got great
    promise, and I know AMC has asked MMA for their capabilities
    and capacities in that regard, and those discussions are
    ongoing.
        There were some folks there too, Senator, from the
    installation management team, and it looks like there may be a
    possibility of funneling some of our nontactical fleet to the
    MMA, specifically our fire fighting equipment that is in dire
    need of refurbishment that we supply to our installations. So
    all of that is ongoing.
        Senator Collins. Great.
        Thank you, Mr. Chairman. And I thank the witnesses.

                               PINE BLUFF ARSENAL

        Senator Johnson. Senator Pryor.
        Senator Pryor. Thank you, Mr. Chairman.
        Thank you all for being here today. I would like to ask, if
    I can, maybe General Boozer and also Mr. Hansen a little bit
    about the Pine Bluff arsenal, which is a facility in my State
    that has a huge chemical stockpile that has been destroyed on
    schedule and I think even under budget or at least on schedule
    and ahead of budget. As that thing closes down and that goes
    away and we lose all of that, it is going to have about a $100
    million impact to the community annually.
        The Workforce Transition Office, I think, was established
    in 2009 between the Army and the Southeast Arkansas Economic
    Development Authority to address things like retirement
    counseling, outplacement assistance, training assistance, et
    cetera. And I will be meeting with them soon. I think it is
    next week or the week after. I am not sure.
        I guess the first question is for both of you all. Are you
    aware of the circumstances surrounding the Pine Bluff arsenal
    and the Pine Bluff community? Are you all aware of that?
        General Boozer. Senator Pryor, I am not simply aware of
    that issue.
        I know kind of where we are with the Pine Bluff disposal
    facility. They have started that campaign that started in about
    December of 2008, and they are doing great work out there
    destroying just tons of mustard gas and mustard stuff.
        We had not even as an Army begun the closure process
    because I think we have to go through and figure out what there
    really needs to be decontaminated and/or demolished and then
    what are some potential uses as well. So the closure process,
    at least to my knowledge, has not even begun at Pine Bluff.
        Mr. Hansen. I am somewhat familiar, although you have
    alluded to some things that I probably need to find out some
    more about. As you are aware, the chem demil program,
    established by Public Law 99-145, called for eliminating all
    chemical warfare-related materials, and a key feature of that
    program is the requirement for those chem demil facilities
    themselves to be destroyed upon completion of the mission. At
    that time, we are looking at each of the buildings and
    structures there right now to determine which ones might be
    retained and which ones would be contaminated and have to be
    destroyed or decontaminated.
        We do not know an exact closure date. We have not finished
    that process at this time, but we do expect to work very
    closely with your authority to make sure that people are taken
    care of to the extent possible.
        Senator Pryor. Great. I do not know if you all have plans
    for all the equipment and weapons that will be coming back from
    Afghanistan and Iraq in terms of reset and all that, but I
    would suggest the Pine Bluff arsenal may be a good place that a
    lot of that could be done. If you are familiar with the
    facility, you will know why I say that because they just have a
    great workforce, a lot of infrastructure there, and a lot of
    resources there that I think could really be helpful on that.
        Let me also ask about the Army National Guard itself. I
    know that if you look at the Army National Guard installations,
    I think the average age is maybe 41 years old. I think 24
    percent are over 70 years old, and I think we have 37
    facilities that are over 100 years old. I know that last year
    when we did the stimulus and the Recovery Act, we discussed the
    needs for the Guard Bureau to be able to have resources to
    upgrade or improve their situation. I think that they gave us a
    list of over 100 priorities that were shovel-ready projects. I
    think they totaled about $1.2 billion, if my memory is correct.
        But anyway, unfortunately I think that most of this--not
    all of it, but most of it--was just ignored by the Army. So I
    guess my first question is do we know why a lot of these
    shovel-ready projects were not funded. Let me just start with
    that question. Do we know why they were not funded, why the
    shovel-ready projects were not funded?

                              ARMY NATIONAL GUARD

        General Carpenter. Senator, as we worked through the
    process when the stimulus package was being formulated, a call
    went out to all components of the Army to provide potential
    projects that would be shovel-ready, and from the Army Guard's
    perspective, we had a number of those. You have identified the
    list that we submitted, sir. And we forwarded them to the Army
    for competition.
        Senator Pryor. Did they lose out on that competition, or
    are they still being considered?
        General Carpenter. Sir, we ended up having, I believe, $50
    million worth of projects funded through the construction piece
    of the stimulus package, and that amounted to, I believe, about
    8 or 10 projects. I would have to provide that information to
    you for the record.
        [The information follows:]

        Fiscal year 2009 MCNG Economic Stimulus Package Program (ARRA)--Six
    projects funded:
      --CA, Mather AFB, Airfield Resurface
      --NE, Camp Ashland, Dining Facility Add/Alt
      --NY, Fort Hamilton, Ready Building
      --NC, Raleigh, Armed Forces Reserve Center
      --OR, Camp Withycombe, Readiness Center
      --WV, Gassaway, Readiness Center
        Note: Due to bid savings in the fiscal year 2009 ARRA program, the
    ARNG is planning to fund four more projects:
      --CA, Camp Roberts, Dining Facility
      --GA, Marietta Dinning Facility Add/Alt
      --OR, Camp Rilea, Sanitary Sewer Rehab
      --RI, Camp Fogarty, Rigger Facility

        Senator Pryor. So are you saying the Guard Bureau got $50
    million out of that?
        General Carpenter. I believe that is the correct number.
        Senator Pryor. And do you remember what the total was that
    the military got for the shovel-ready projects?
        General Carpenter. Mr. Senator, I believe total Milcon from
    the stimulus bill was $230 million, of which $50 million went
    to the National Guard.
        Senator Pryor. I do not know about that ratio. That sounds
    like that may be close to 20 percent, if I am doing that math
    right, and that may be about the right ratio, but at the same
    time, the Guard and the reserve component is really the key to
    our readiness today. I mean, we are asking them to do more and
    more. A lot of them--not all, but a lot of them--are working in
    antiquated buildings and outdated infrastructure. So I guess I
    would encourage you all just to continue to try to find ways to
    get the Guard the resources they need so that you can fund some
    of these projects. Like I said, it sounds like you maybe funded
    8 and you have 100 on the list. Maybe you got eight done.
        Mr. Snyder. I would like to add also, Senator, that the
    Army Reserve received $98 million that funded 22 projects in
    the ARRA.
        Senator Pryor. The Reserve did.
        Mr. Snyder. Yes, sir.
        Mr. Calcara. Sir, if I could, it is important to note that
    the ARRA program was a DOD-wide look in how the projects
    competed. Other than a worst first or a fair share type look,
    there were other aspects that were brought to that: geographic
    balance, job creation. There were other aspects in the funding
    of ARRA that are not present in our normal discourse when we
    decide how to make investments. So I think we did fairly well.
    If you look across the Army as a portfolio, we got the lion's
    share of the funding in DOD. So there is some goodness in what
    happened there, albeit we could always use more.
        Senator Pryor. Thank you, Mr. Chairman.
        Senator Johnson. Senator Murkowski.

                                 ALASKA MILCON

        Senator Murkowski. Thank you, Mr. Chairman.
        Gentlemen, good morning. Mr. Hansen, I will start with you.
    I think we recognize well the opportunities that Alaska
    presents with its joint training ranges. Some have described
    them as superlative, and if I could think of a better word, I
    would go higher than that. But I think we recognize that the
    opportunity for the Air Force, the Army, now the Navy to
    conduct synchronized training free from encroachments is a real
    asset.
        Can you comment on the Army's future plans for continued
    infrastructure development on these training grounds, and how
    do you plan to maximize utilization of this national asset?
        Mr. Hansen. We had a discussion on that just before the
    hearing this morning, ma'am. If it is okay with you, I would
    like to defer to Mr. Calcara on that. I think he has more
    detailed information.
        Mr. Calcara. I did not have the discussion this morning,
    Jerry.
        Senator Murkowski. They discussed that you were going to
    speak to it.
        Mr. Calcara. I am going to defer to General Boozer.
        Senator Murkowski. All right. Pass it on down.
        General Boozer. That is what I get, Senator, for sitting at
    the end of the table.
        Ma'am, I know in the 2011 request there is some substantial
    Milcon in Alaska which I think goes to show that we believe
    that when you just stated is that there are great training
    opportunities up there in Alaska. A little over $300 million in
    the 2011 request. A lot of that goes toward some multiple
    purpose machine gun range, a simulation center which gets right
    at the heart of training, and I think an urban assault course
    as well. And I believe the Army will continue to invest in both
    Forts Greeley and Wainwright or Fort Richardson as well in
    Alaska for a long time to come.
        Senator Murkowski. Well, we continue at the State level to
    try to do what we can to further open up training ranges. Our
    legislature just met and are working to provide for some
    transportation corridors that I think will be helpful to you.
        Let me ask a question, and again, I do not know whether
    this is to you, Mr. Hansen, or to others, but this is regarding
    improper classification of construction workers. The Department
    of Labor has initiated a pretty major effort to ensure that
    businesses do not improperly classify construction workers as
    independent contractors rather than employees. I was just
    visited yesterday in my office by some in the Alaska
    construction trades that are concerned that some of the
    contractors that utilize construction workers on Alaska Army
    bases may be engaging in this process of misclassification.
        Does the Army have a process for investigating these
    complaints and enforcing compliance with wage and hour laws,
    and if they do not, should they?
        Mr. Calcara. I guess I will take that one, ma'am. It is
    hard to make a general statement whether we are talking about
    military construction projects or repair projects done through
    an RCI. But the Department of Labor does routinely conduct wage
    rate interviews, and that is the process. Essentially when DOL
    comes in and does a wage rate labor classification interview
    and they have a finding, then the Army would address it. So I
    believe there is a process in place. I have not heard about the
    issue you just mentioned, but I will certainly take it back and
    follow up with your staff and see what I can do about it.
        Senator Murkowski. Well, I would appreciate that, and if we
    can give you more specifics to which to respond, we will do so.
        Mr. Calcara, we will just keep going with you here. You are
    certainly aware of the concerns that have been expressed
    previously by many in the Fairbanks community about the use of
    out-of-State contractors and construction workers by the Actus
    Lend Lease there at Wainwright. I had a chance to discuss this
    issue with Dorothy Rabin a few weeks ago and she suggested at
    that time that the issues that I raised were concerns that were
    uncommon in privatized housing projects, and she basically
    suggested that I ask the various services.
        I know that you do have small business utilization goals,
    but that does not necessarily ensure that the local workers get
    the construction jobs. So the question is, do you think it is
    good policy to encourage housing privatization partners to use
    the local contractors and local construction workers for the
    privatization work, or is the Department indifferent on this as
    an issue?
        Mr. Calcara. We absolutely think it is good policy. Just to
    follow up, as you know, I have been personally engaged in this.
        Senator Murkowski. Which we appreciate.
        Mr. Calcara. And I have done a deep dive on the metrics
    across the programs. So I want to throw a couple numbers out
    there for the record. Of the $5.7 billion in the portfolio in
    construction through December 31st of last year, $3.6 billion,
    or over 60 percent of it, has gone to small and local
    businesses. In Alaska, we are beating that by about 15 percent.
    We are in the 75 to 80 percent range.
        So where is the issue? Because you are obviously getting
    feedback. My understanding is that while we have State-licensed
    contractors, they may, in fact, have corporate headquarters in
    other parts of the country. They may, in fact, be augmenting
    staff with folks that are coming in from other areas of the
    country.
        I am not sure there is much that we could do through policy
    or incentivization to that. The developers and the service
    providers are incented to hit small business and local goals.
    They are also incented to be efficient and effective in the
    pricing and the delivery of the construction. And to the extent
    that someone who is locally licensed wants to hire someone from
    Washington State to work in Alaska on a project, there is
    really not much we can do about that. So that is kind of how I
    look at it, ma'am.

                         MILITARY HOUSING PRIVATIZATION

        Senator Murkowski. So you do not think it is necessary or
    perhaps appropriate to change the laws governing the military
    privatization to require that some level of local contracting
    be utilized.
        Mr. Calcara. Well, I guess if you define local as people
    who are born or living, I would say no. If you define local as
    someone who has a State license there, again, we are hitting
    two-thirds of the portfolio, three-quarters in Alaska local and
    small business. So it is how you define ``local'' I guess.
        Senator Murkowski. Well, as you know--and again, I
    appreciate your engagement in this--it has been an issue that
    has generated some controversy and a great deal of discussion.
    At least there has been more full-on debate and discussion
    about it of late, and I think that we are making some gains and
    that is good.
        Another issue that is in the same category--and Mr.
    Chairman, if I just can have another 30 seconds to finish up
    here, I will conclude with my questions.
        But I had a chance to bring this up again a couple weeks
    ago as it related to those who are not lawfully eligible to
    work here in the United States. We had a situation last year
    where on one of our Alaska bases there was an investigation of
    some of the individuals that were working on construction of
    building hangars, and it was determined that 4 out of the 30
    individuals were not lawfully eligible to work in the United
    States. One was determined to have a criminal history in the
    State of California, and of course, the big brouhaha was this
    is on a military base. It is supposed to have secure areas, and
    we had a situation, an example, where not only were the people
    not eligible to work here in the United States getting through
    the gate, but with criminal backgrounds.
        So the question that I had asked and I will ask of you is,
    is the Army doing anything to ensure that those working in its
    facilities are lawfully here working in the United States and
    whether or not, for security reasons, we need to be doing more
    to ensure a level of compliance?
        Mr. Calcara. Well, as you know, ma'am, all our bases are
    generally in controlled access areas. So all contractors have
    to have badges and, at some point, have to provide a copy of a
    contract that they have with the Federal Government, as well as
    the necessary identification to get a badge issued.
        Are there anecdotal instances where folks get through that
    net? It does not surprise me that you have uncovered some. I
    guess from here on out, we will reissue policy to ensure that
    we are diligent in checking those credentials. Obviously,
    contractors have to have an active contract to get on a post.
    Ultimately, that is the compliance measure that we use. We just
    have to get a little tighter, I guess, and catch those 4 out of
    30 that appeared to get through the net.
        Senator Murkowski. And I think part of this issue was,
    again, it was a contractor who brought up folks from outside.
    It goes back to the local hire issue, and that is why they come
    to my attention.
        Mr. Calcara. Yes, ma'am.
        Senator Murkowski. And I in turn bring them to yours. So I
    look forward to working with you on some of these details.
        With that, Mr. Chairman, I thank you for the time.

                         ADDITIONAL COMMITTEE QUESTIONS

        Senator Johnson. To this panel, thanks for your service to
    our Nation. You may be excused.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                    Questions Submitted to Hon. Jerry Hansen
                   Questions Submitted by Senator Tim Johnson

                         ENERGY EFFICIENCY IMPROVEMENT

        Question. What is the Army doing to improve energy efficiency on
    its bases and increase the use of green building practices, in
    particular green or cool roof projects?
        Answer. In order to provide energy efficient and sustainable new
    facilities, the Army continues to require all military construction
    (Milcon) achieve the SILVER criteria of the U.S. Green Building
    Council's Leadership in Energy and Environmental Design (LEED) rating
    tool. Projects are evaluated in 6 LEED major credit areas: Sustainable
    Sites, Water Efficiency, Energy & Atmosphere, Material & Resources,
    Indoor Environmental Quality, and Innovation & Design Process. Army
    also requires new facilities to be 30 percent more energy efficient
    than the industry standard defined by the American Society of Heating,
    Refrigerating and Air-Conditioning Engineers (ASHRAE) 90.1-2004. As
    such, new buildings will incorporate appropriate engineering solutions
    (insulation and windows), design features (cool roofs and daylighting),
    technologies (LED lights and ground source heat pumps), and energy
    efficient mechanical systems (Energy Star  rated motors) where life-
    cycle cost effective.
        All Sustainment, Restoration and Modernization (SRM) funded
    projects for repair, maintenance, and new work are also required to
    comply with and, where applicable, contribute toward the goals
    specified in the Energy Policy Act of 2005 and incorporate sustainable
    design features where life-cycle cost effective. For instance, all new
    roofing or planned re-roofing SRM projects in climate zones 1 to 5 are
    required to install reflective ``cool'' roofs over air conditioned
    spaces in buildings.

                                ENERGY SECURITY

        Question. Energy security on bases is a major concern. What is the
    Army doing to protect critical mission assets from the threat of
    extended disruptions to the commercial power grid?
        Answer. The Army Energy Security Implementation Strategy
    communicates the Army's energy security vision, mission, goals, and
    sets forth the framework to address the five key components of
    security--surety, survivability, supply, sufficiency, and
    sustainability. The Army is developing a template to ensure
    installation energy security plans have a standard to identify critical
    loads, methods and plans to supply backup utilities in the event of an
    emergency, and identify actions needed to harden utility systems to
    improve their energy security posture. Using American Recovery and
    Reinvestment Act (ARRA) funding, the Army is developing an Energy
    Security Audit Model which will provide a consistent methodology to
    identify potential energy security vulnerabilities and prioritize
    energy security risks and mitigation projects. The Army is also
    expanding the use of renewable energy through the Energy Conservation
    and Investment Program and alternative financing programs to reduce our
    reliance on the grid. Alternative financing programs for partnering
    with the private sector include Enhanced Use Leases, Power Purchasing
    Agreements, Energy Savings Performance Contracts and Utility Energy
    Services Contracts.

                     ENERGY CONSERVATION INVESTMENT PROGRAM

        Question. The Army's share of the fiscal year 2011 Energy
    Conservation Investment Program (ECIP) is $43.4 million. Could you
    execute additional funding?
        Answer. Yes, the Army could execute as much as an additional
    $51,132,000 if received early in the fiscal year.
                                     ______

                Questions Submitted by Senator Mary L. Landrieu

                             BARRACKS PRIVATIZATION

        Question. Will the current Army Milcon and SRM investment funding
    plans provide single enlisted soldiers the same quality of housing we
    provide married soldiers by a date certain?
        Answer. Yes, we are providing safe, convenient, high-quality
    housing for our single soldiers just as we are with the married
    soldiers. The Army is currently in year 17 of its 20-year Permanent
    Party Barracks Modernization Program. By fiscal year 2013, all funding
    will be in place for this barracks program with occupancy estimated for
    fiscal year 2015, every single soldier will be provided with a quality
    living space. The Permanent Party Barracks Modernization Program is the
    foundation for providing our warriors with the best facilities
    possible. Following the completion of the modernization program, the
    Army will program the replacement of older legacy facilities to ensure
    all soldiers remain adequately housed.
        Question. Does budgeting to attempt to maintain permanent party
    barracks as ``adequate'' under current Army standards meet the
    obligation to provide single soldiers the same quality of housing as
    their married counterparts?
        Answer. Yes, we are budgeting to maintain safe, convenient, high-
    quality housing for our single soldiers just as we are with the married
    soldiers. The sustainment requirements for Permanent Party barracks are
    generated through the Department of Defense Facilities Sustainment
    Model (FSM). The FSM calculates the funding requirement in order to
    sustain facilities at an adequate level or condition. The Office of
    Secretary Defense mandates that all facilities are funded to at least
    90 percent of the Army requirement generated by the FSM. The buyout of
    inadequate barracks remains the top priority among facility programs in
    the Army.
                                     ______

                    Questions Submitted to Joseph F. Calcara
                   Questions Submitted by Senator Tim Johnson

                         HOMEOWNERS ASSISTANCE PROGRAM

        Question. This subcommittee has provided a total of $855 million in
    funding to expand the Homeowner's Assistance Program, or HAP, to help
    military families who face massive losses on the sale of their homes
    when they are required to relocate during the current mortgage crisis.
        Could you outline the status of the expanded HAP program and the
    expenditures to date?
        Answer. The U.S. Army Corps of Engineers began receiving
    applications in February 2009. Payments to beneficiaries began in
    October 2009. Eligible applications submitted to date total 5,918.
    Benefits totaling $183.2 million have been paid to 1,445 eligible
    applicants.
        Question. DOD has proposed legislative changes to the HAP language.
    Can you explain the reasons for these changes?
        Answer. Presently, the law requires the Government to purchase an
    applicant's home when the applicant's home value is less than their
    mortgage payoff. This proposal would allow the Government to pay only
    the difference between the price for which an applicant sells his/her
    home and the mortgage payoffs rather than purchasing the home and then
    immediately selling the home to the applicant's buyer. This legislation
    will simplify and speed claim payment and improve HAP fund management.
        Question. DOD claims this proposal will have no budgetary impact.
    Would you please provide the subcommittee the detailed budgetary
    analysis on which that conclusion is based?
        Answer. The proposal will substantially reduce claim processing
    time, slightly reduce transaction costs, and improve funds management
    by eliminating the current requirement for the Government to acquire
    the applicant's home and immediately re-sell the home to the
    applicant's buyer. Under the current law, this dual, sequential
    transaction forces the Government to fully fund the acquisition of the
    home and deposit the full Government ``re-sale'' proceeds in the HAP
    account, where they must be re-apportioned by OMB before they can be
    used by the program. That process of deposit and re-apportionment takes
    approximately 90 days and reduces available funds accordingly. The
    proposed legislation will have little budgetary impact, but will
    greatly simplify and improve the transaction by allowing the Government
    to merely pay the claim payment at the applicant's closing.
        Question. The expanded HAP authority gives the Secretary the
    discretion to compensate homeowners through September 30, 2012, with
    the discretion to terminate the program earlier. However, the HAP Web
    site has been updated to say that the permanent reassignment orders
    must be received by September 30, 2010, to be eligible for
    compensation.
        Given the continuing turmoil in the real estate market--especially
    in States like Florida, Arizona and Nevada which host large military
    installations--it seems very possible that military families will be
    struggling to sell their homes for some time to come.
        Has the Secretary made a decision to terminate the temporary
    expansion of HAP on September 30, 2010, and if so, why?
        Answer. DOD is currently assessing the availability of HAP funds to
    pay benefits for claims from members who move under Permanent Change of
    Station (PCS) orders. HAP claim payments for PCS applicants are
    averaging $126,000, which is 60 percent greater than $77,000 per claim
    cost originally forecast. However, DOD will assess what date PCS
    applications should be terminated after evaluating the number and rate
    of claim growth through the summer fiscal year 2010 PCS move cycle.
    Additionally, there is flexibility in the HAP budget plan that would
    allow payment of more PCS claims from HAP funds currently targeted for
    BRAC 2005 claim payments, if those BRAC claims lag forecasted volume.
        Question. Do you foresee a requirement for any additional funding
    to compensate military families under this program if the expanded
    benefits extend beyond 2010?
        Answer. The mortgage crisis has been extensive and costly. However,
    it is too early to accurately forecast whether current funding will be
    sufficient to fund the program as originally envisioned. While, claims
    are more expensive than forecast, it's not clear yet whether the volume
    of forecasted claims will vary substantially. DOD hopes to have a
    better analysis of the available funding at the conclusion of the
    fiscal year 2010 summer PCS cycle.
                                     ______

                Questions Submitted by Senator Mary L. Landrieu

                             BARRACKS PRIVATIZATION

        Question. Will the current Army Milcon and SRM investment funding
    plans provide single enlisted soldiers the same quality of housing we
    provide married soldiers by a date certain?
        Answer. Yes, we are providing safe, convenient, high-quality
    housing for our single soldiers just as we are with the married
    soldiers. The Army is currently in year 17 of its 20-year Permanent
    Party Barracks Modernization Program. By fiscal year 2013, all funding
    will be in place for this barracks program with occupancy estimated for
    fiscal year 2015, every single soldier will be provided with a quality
    living space. The Permanent Party Barracks Modernization Program is the
    foundation for providing our warriors with the best facilities
    possible. Following the completion of the modernization program, the
    Army will program the replacement of older legacy facilities to ensure
    all soldiers remain adequately housed.
        Question. Does budgeting to attempt to maintain permanent party
    barracks as ``adequate'' under current Army standards meet the
    obligation to provide single soldiers the same quality of housing as
    their married counterparts?
        Answer. Yes, we are budgeting to maintain safe, convenient, high-
    quality housing for our single soldiers just as we are with the married
    soldiers. The sustainment requirements for Permanent Party barracks are
    generated through the Department of Defense Facilities Sustainment
    Model (FSM). The FSM calculates the funding requirement in order to
    sustain facilities at an adequate level or condition. The Office of
    Secretary Defense mandates that all facilities are funded to at least
    90 percent of the Army requirement generated by the FSM. The buyout of
    inadequate barracks remains the top priority among facility programs in
    the Army.
        Question. What is the Army plan to move forward with pilot junior
    barracks privatization projects to resolve these remaining questions
    once and for all?
        Answer. The Army will continue to survey mission commanders and
    sergeants major regarding unit integrity and warrior ethos in an effort
    to identify locations where barracks privatization might be a viable
    option in the future.
                                     ______

                   Questions Submitted to General Jim Boozer
                Questions Submitted by Senator Mary L. Landrieu

                             BARRACKS PRIVATIZATION

        Question. Will the current Army Milcon and SRM investment funding
    plans provide single enlisted soldiers the same quality of housing we
    provide married soldiers by a date certain?
        Answer. Yes, we are providing safe, convenient, high-quality
    housing for our single soldiers just as we are with the married
    soldiers. The Army is currently in year 17 of its 20-year Permanent
    Party Barracks Modernization Program. By fiscal year 2013, all funding
    will be in place for this barracks program with occupancy estimated for
    fiscal year 2015, every single soldier will be provided with a quality
    living space. The Permanent Party Barracks Modernization Program is the
    foundation for providing our warriors with the best facilities
    possible. Following the completion of the modernization program, the
    Army will program the replacement of older legacy facilities to ensure
    all soldiers remain adequately housed.
        Question. Does budgeting to attempt to maintain permanent party
    barracks as ``adequate'' under current Army standards meet the
    obligation to provide single soldiers the same quality of housing as
    their married counterparts?
        Answer. Yes, we are budgeting to maintain safe, convenient, high-
    quality housing for our single soldiers just as we are with the married
    soldiers. The sustainment requirements for Permanent Party barracks are
    generated through the Department of Defense Facilities Sustainment
    Model (FSM). The FSM calculates the funding requirement in order to
    sustain facilities at an adequate level or condition. The Office of
    Secretary Defense mandates that all facilities are funded to at least
    90 percent of the Army requirement generated by the FSM. The buyout of
    inadequate barracks remains the top priority among facility programs in
    the Army.
        Question. What is the Army's plan to move forward with pilot junior
    barracks privatization projects to resolve these remaining questions
    once and for all?
        Answer. The Army continues to look at all of its options to
    supplement our barracks modernization program throughout the United
    States to fix and sustain quality housing for single soldiers over the
    long term. The Army's Unaccompanied Personnel Housing Privatization
    Study did show that barracks privatization projects can be financially
    feasible. But, the Army has concerns that discontinuing Army culture
    and practices due to introduction of a privatized barracks project
    would adversely affect soldier training and discipline that currently
    occurs in this living space. Additionally, there is a challenge of how
    to fund the Basic Allowance for Housing bill that will be generated by
    privatization over the next 50 years.
        Question. Assuming OMB full upfront scoring is avoided, is the cost
    of the three pilots in the study of $22 million in the first year that
    significant for the Army given the ability to sustain the housing for
    the long term?
        Answer. No. The first year cost of barracks privatization for the
    three pilots is not significant. However, the 50-year cost of barracks
    privatization for the three pilots (i.e., the difference between the
    Basic Allowance for Housing (BAH) and traditional funds available for
    barracks construction, renovation, sustainment, operations and
    management) is significant. In the study, we estimated the differential
    to be a total close to $1.7 billion more than traditional funds
    available for the three projects over 50 years.
        Question. Are there not additional offsets to those costs, such as
    the current BAH costs from issuances of certificates of non-
    availability that are not reflected in the financial analysis in the
    Army study?
        Answer. Yes. There may be some additional, minor costs on ``both
    sides of the equation'' that were not considered in the study. However,
    we believe we have captured all of the major costs, and we are
    confident that the estimates in the study are reflective of the cost of
    barracks privatization.

                          Department of the Air Force

    STATEMENT OF HON. TERRY A. YONKERS, ASSISTANT SECRETARY
                OF THE AIR FORCE (INSTALLATIONS,
                ENVIRONMENT AND LOGISTICS)
    ACCOMPANIED BY:
            KATHLEEN I. FERGUSON, DEPUTY ASSISTANT SECRETARY OF THE AIR
                FORCE (INSTALLATIONS)
            MAJOR GENERAL PATRICK J. MOISIO, DEPUTY DIRECTOR, AIR NATIONAL
                GUARD
            MAJOR GENERAL DAVID L. COMMONS, MOBILIZATION ASSISTANT TO THE
                CHIEF, AIR FORCE RESERVE

        Senator Johnson. I am pleased now to welcome our second
    panel of witnesses: the Hon. Terry A. Yonkers, Assistant
    Secretary of the Air Force for Installations, Environment and
    Logistics; Ms. Kathleen I. Ferguson, Deputy Assistant Secretary
    of the Air Force for Installations; Major General Patrick J.
    Moisio, Deputy Director, Air National Guard; and Major General
    David L. Commons, Mobilization Assistant to the Chief of the
    Air Force Reserve. Thank you all for coming. We look forward to
    your testimony, and again, your full statements will be entered
    into the record.
        Secretary Yonkers, please proceed.
        Mr. Yonkers. Good morning, Chairman Johnson and
    distinguished members of the subcommittee. And thank you for
    inviting me here today to address the Air Force's military
    construction, family housing, and BRAC implementation programs.
        I would like to begin by thanking the subcommittee for its
    continued support of the Air Force and the thousands of
    dedicated and brave airmen, their families serving this great
    Nation.
        Today is the 40th anniversary of Earth Day, and throughout
    our Nation, businesses, schools, and our military services are
    working to protect our planet; preserve our air, water, and
    land; and develop clean alternative sources of energy. And the
    Air Force is doing its part to realize a more secure and
    sustainable future.
        A clean and safe environment and secure sources of energy
    are essential for meeting our mission requirements and
    improving the quality of life for our airmen. The Air Force is
    proud to be a member of America's ongoing quest to restore and
    preserve our natural resources and use our energy more
    efficiently and effectively.
        I will now briefly talk a little bit about the Air Force's
    military construction, family housing, and base realignment and
    closure programs which form the foundation of our installation
    structure and provide the direct support responsible for
    meeting the needs of our airmen and their families.
        Our fiscal year 2011 President's budget request contains
    $5.5 billion for facility maintenance, military construction,
    military family housing, and base realignment and closure,
    which is a 3.8 percent increase above our fiscal year 2010
    request. Our facility sustainment and recapitalization programs
    represent the largest portion of that request with $3.1 billion
    to maintain and modernize our Air Force installations. The $1.5
    billion military construction request prioritizes our
    requirements and ensures new construction is aligned with
    weapon system deliveries and strategic basing initiatives,
    while we continue to accept some risk in our aging
    infrastructure recapitalization.
        Additionally, we continue our efforts to provide quality
    housing for airmen and their families by dedicating $600
    million to sustain and modernize overseas housing and support
    housing privatization in the continental United States.
        We also request a total of $252 million to continue
    completing our BRAC 2005 program requirements, as well as our
    legacy BRAC programs and especially environmental cleanup.
        In regards to our total force military construction
    program, I do want to mention the difficult decisions we made
    last year or made this year with regard to the funding of the
    component and major command priorities. Each component and each
    Active Duty major command received their top priority project.
    The apparent disparity among the Active Duty, the Guard, and
    the Reserve military construction reflects funding in the
    component's number one project and not the dollar value of
    these projects.
        This year the Active Duty, which is about 87 percent of
    plant replacement value, received 80 percent of the investment
    stream. The Air National Guard is about 9 percent of plant-to-
    replacement value and received 17 percent of the investment
    stream. The Air Force Reserve is about 4 percent of plant
    replacement value. This year the Air Force Reserve received
    their top priority project, a maintenance facility at Patrick
    Air Force Base, but that only equated to about 2 percent of
    plant replacement value.
        The funding to components and the major commands shifts
    from year to year and it is important that we take care of the
    entire total Air Force. We greatly appreciate Congress'
    continued support of all the Air Force components, particularly
    in fiscal year 2010 in which the Congress provided a
    substantial amount of additional funding for the Air Force
    Reserve.
        I would like to close by briefly mentioning the Air Force's
    efforts in executing the base realignment and closure
    recommendations. To implement assigned recommendations, the Air
    Force's plan calls for the execution of nearly 400 separate
    actions, utilizing a budget that has been and remains fully
    funded at $3.8 billion. Two-thirds of this budget is military
    construction. Our BRAC military construction program will make
    its last contract award before the close of this fiscal year.
    In total, we will execute 231 BRAC military construction
    projects at 56 installations in 36 States. I am confident in
    telling you that the Air Force will complete that
    implementation of BRAC 2005 on time and within the budget.
        Today I am really pleased to have accompanying me Deputy
    Assistant Secretary for Installations, Ms. Kathleen Ferguson;
    Major General Commons, who is the Mobilization Assistant to the
    Chief of the Air Force Reserve; and also Major General Moisio,
    who is the Deputy Director of the Air National Guard.

                               PREPARED STATEMENT

        Sir, that concludes my remarks. I thank the subcommittee
    again for all that you have done for us and your continued
    support of our airmen and their families, and I look forward to
    any questions that you may have.
        [The statement follows:]

                  Prepared Statement of Hon. Terry A. Yonkers

                                  INTRODUCTION

        The ability of our Airmen to perform their missions world-wide is
    directly affected by the quality of resources, access to facilities, a
    robust logistics infrastructure for sustainment, and a confidence that
    while they are deployed their families are well taken care of and their
    needs are being met.
        Air Force Military Construction (Milcon), Military Family Housing
    (MFH), and Base Realignment and Closure (BRAC) programs form the
    foundation of our installation structure and provide the direct support
    responsible for meeting the needs of our Airmen and their families.
        We recognize we cannot lose focus on critical Air Force
    infrastructure programs, and we are working hard to ensure we have the
    proper infrastructure to enable our Airmen to perform their duties
    while ensuring responsible stewardship of fiscal resources.
        Our efforts are in direct support of the Air Forces' five
    priorities, which serve as a framework for this statement: (1) continue
    to strengthen the nuclear enterprise; (2) partner with the Joint and
    Coalition team to win today's fight; (3) develop and care for our
    Airmen and their families; (4) modernize our air and space inventories,
    organizations, and training; and (5) recapture acquisition excellence.

                                    OVERVIEW

        Our fiscal year 2011 President's Budget Request contains $5.5
    billion for facility maintenance, military construction, military
    family housing, and Base Realignment and Closure, which is a 3.8
    percent increase above our fiscal year 2010 request. Our facility
    maintenance and repair account represents the largest portion of the
    request, with $3.1 billion to maintain Air Force installations. The
    $1.5 billion military construction request prioritizes our requirements
    and ensures new construction is aligned with weapon system deliveries
    and strategic basing initiatives, while we continue to accept some risk
    in aging infrastructure recapitalization. Approximately one-third of
    the military construction request is dedicated to new mission
    requirements, and in this year's budget all new mission projects are
    programmed in the Air National Guard and Active Duty components.
    Additionally, we continue our efforts to provide quality housing for
    Airmen and their families by dedicating nearly $600 million to
    sustaining and modernizing overseas housing, and supporting housing
    privatization in the Continental United States. We also request a total
    of $252 million to continue completing our BRAC 2005 program
    requirements as well as our legacy BRAC programs and environmental
    clean-up.
        In the course of building the fiscal year 2011 budget request, we
    made a number of difficult choices among competing priorities. One of
    these was a necessary but difficult decision to continue taking risk in
    our military construction as well as our restoration and modernization
    accounts. We continue to mitigate risk by funding facility sustainment
    to the 90 percent level in order to ensure that we keep our good
    facilities good.
        We also made difficult decisions regarding the funding of component
    and major command priorities. Each component and major command received
    their top priority project. The apparent disparity among the Active
    Duty and Guard and Reserve MILCON reflects funding of the component's
    No. 1 project and not the dollar value of those projects. This year,
    the Active Duty, which is about 87 percent of Plant Replacement Value
    (PRV), received 80 percent of the investment stream. The Air National
    Guard is about 9 percent of PRV and received 17 percent of the
    investment stream. The Air Force Reserve is about 4 percent of PRV.
    This year the Air Force Reserve received their top priority project, a
    maintenance facility at Patrick Air Force Base, but that only equated
    to about 2 percent of PRV. The funding to components and MAJCOMs shifts
    from year to year and it is important that we take care of the entire
    Air Force family. We greatly appreciate Congress' continued strong
    support of all of the Air Force components, particularly in fiscal year
    2010, in which the Congress provided a substantial amount of additional
    funding for the Air Force Reserve.
        The Air Force is also very appreciative of the support provided
    through the American Recovery and Reinvestment Act of 2009. The
    Recovery Act contributed significantly to our infrastructure. From this
    legislation, we received a total of $1.7 billion to support Air Force
    projects, including $1.3 billion for operations and maintenance for
    facilities sustainment, restoration, and modernization (FSRM); $327
    million in military construction and military family housing for
    dormitories and child development centers; and $75 million in research,
    development, testing and evaluation for projects to improve energy
    efficiency. In accordance with Congressional intent to allocate the
    funds quickly, we moved expeditiously to award contracts. By the end of
    calendar year 2009, we awarded nearly 90 percent of the funding
    allocated for our FSRM and military construction projects.
    Additionally, with the funding we saved from competitively bid
    projects, we funded two additional military construction requirements--
    a dormitory and a child development center collectively valued at $33.2
    million.

                 CONTINUE TO STRENGTHEN THE NUCLEAR ENTERPRISE

        Since its inception, the Air Force has served as a proud and
    disciplined steward of a large portion of the Nation's nuclear arsenal.
    We steadfastly operate, maintain, and secure nuclear weapons to deter
    potential adversaries, and to assure our partners we are a reliable
    force providing global stability. The first Air Force priority during
    the last 2 years has been to reinvigorate the stewardship,
    accountability, compliance, and precision within the nuclear
    enterprise. We have made progress in this area and will continue our
    pursuit of the highest standards of performance.
        In addition to ensuring our organizations and human resource plans
    support this mission, we are also concentrating on the infrastructure
    and facilities crucial to our success. To support this work, during the
    past 18 months, Air Force civil engineers have conducted enterprise-
    wide facility assessments to refine our investment plans, and we are
    now beginning to execute our long-term investment strategy. Our fiscal
    year 2011 budget request includes $22.8 million in military
    construction for the nuclear enterprise, including a weapons load crew
    training facility at Barksdale Air Force Base (AFB), Louisiana, and a
    nuclear security tactics training center at Camp Guernsey, Wyoming.
    These and similar projects in the years to come will further our goal
    of a self-sustaining culture of critical self-assessment, continuous
    improvement, and unwavering excellence.

         PARTNER WITH THE JOINT AND COALITION TEAM TO WIN TODAY'S FIGHT

        Our Air Force continues to bring air, space, and cyber power to
    great effect in our conflicts in Afghanistan and Iraq, and our men and
    women make incredible contributions daily. We currently have almost
    40,000 Airmen deployed, including nearly 3,500 Air Force civil
    engineers. Approximately 20 percent of these Air Force civil engineers
    are filling Joint Expeditionary Taskings, serving shoulder-to-shoulder
    with our Joint teammates. Due to their wide array of skills, our Air
    Force Rapid Engineer Deployable Heavy Operational and Repair Squadron
    Engineers (RED HORSE) and our Prime Base Engineer Emergency Force
    (Prime BEEF) personnel are in high demand in several theaters of
    operation. Additionally, we have more than 150 civil engineers who are
    supporting relief and recovery operations in Haiti.
        In addition to our Airmen's contributions, our fiscal year 2011
    budget request invests $449 million in 40 projects that directly
    contribute to today's fight. Examples include the following:
      --Projects supporting our combatant commanders, particularly in the
            U.S. Central Command area of operations, that will greatly
            enhance ongoing operations. These include a medical evacuation
            ramp expansion, fire station, fighter hangar, and consolidated
            rigging facility in support of enduring airdrop operations at
            Bagram Air Base (AB), Afghanistan; and an apron expansion,
            providing vital Afghan theater of operations with refueling
            capability out of Isa AB, Bahrain. The Air Force goes through a
            structured process to ensure that funds are not expended on
            enduring construction when expeditionary or temporary
            construction will suffice.
      --New operations, maintenance, and training facilities for our Air
            Support Operations squadrons. Airmen from these units,
            including Joint Terminal Attack Control specialists, partner
            with ground forces to integrate airpower in Iraq and
            Afghanistan. These Active and Air National Guard facilities,
            located in close proximity to the Army units that they support
            in both Continental United States and overseas, will further
            increase our capacity to operate and integrate closely with our
            Joint partners.
      --Improvements at Andersen AFB, Guam. Five projects continue to build
            our Pacific Air Force Regional Training Center and support the
            Air Force's ``Guam Strike'' initiative, consolidating
            operational capability for fighter and bomber operations at the
            base.
      --Remotely piloted aircraft beddown, operations, and maintenance
            support infrastructure. Nine projects at various Active Duty
            and Air National Guard locations that support this rapidly
            growing field include an operations facility at Cannon AFB, New
            Mexico; a fire/crash/rescue squadron at Creech AFB, Nevada; a
            new launch and recovery element facility at Fort Huachuca,
            Arizona; and MQ-9 infrastructure support at Fort Drum, New
            York; and others.
      --Facility recapitalization efforts. These--our component and major
            command commanders' ``current mission'' priorities--will, among
            other things, provide a modern operations facility for the
            National Capital Region's Joint Air Defense mission; give our
            special operations Airmen at Hurlburt Field, Florida, a new
            logistics facility and school; and provide Kunsan AB, Korea,
            with a facility to house their new F-16 simulator, due to
            arrive in 2012.

                 DEVELOP AND CARE FOR AIRMEN AND THEIR FAMILIES

        The All-Volunteer Force provides the required foundation for our
    flexible and agile force. Our fiscal year 2011 budget request reflects
    a commitment to preserving and enhancing our force through education
    and training, while also improving the overall quality of life of
    Airmen and their families where they work, live, and play.
    Developing our Airmen
        Our Airmen are the best in the world, and as such they deserve
    first-class facilities in which they can train and advance their
    personal and professional development. Our fiscal year 2011 budget
    request contains five projects totaling $163 million for this effort.
    These projects include a flagship Center for Character and Leadership
    Development at the Air Force Academy, which will provide our future
    officers with a facility invested with the stature that our Service
    Core Values demand. Also, renovation and expansion of Air University's
    Fairchild Research Information Center--the largest military library in
    the world--will preserve the historical perspective and current
    research that form the basis for future airpower and Air Force theory,
    doctrine, and strategy. Additionally, we are continuing to improve
    facilities that support our newest Airmen at Lackland AFB, Texas, by
    building a new recruit dormitory, classroom, and in-processing center.
    These projects continue to improve our Air Force basic military
    training and provide incoming Airmen with facilities that are
    commensurate with the commitment that they make to our Nation.
    Caring for Our Airmen and Their Families
        Because our families are crucial to the success of our Air Force,
    the Secretary of the Air Force designated July 2009-July 2010 as the
    ``Year of the Air Force Family,'' to focus on the contributions of the
    entire Air Force family--military, civilian, spouses, children,
    extended family, and retirees--and investigate ways to make their lives
    better. A large part of this is ensuring that our military have first-
    class homes and dormitories. We also must make certain our base and
    community environments are safe and secure, and they foster a sense of
    community. Simply put, our goal is to provide an even safer and more
    supportive environment for our men and women and their families,
    especially during deployments and other extended absences.

                Billeting
        This project, totaling $62 million, will provide billeting for
    Airmen in our fiscal year 2011 military construction program. Of
    particular note is a third phase of billeting construction at Al Udeid
    AB, Qatar, which will continue our effort to provide Airmen supporting
    operations in the U.S. Central Command theater with a quality place to
    live while deployed far from their families. This project will build
    two billeting facilities.

                Dormitories
        We remain committed to providing excellent housing for our
    unaccompanied Airmen, and we continue to reference our 2008 Dormitory
    Master Plan to make this vision a reality. Our fiscal year 2011 budget
    request includes four dormitory projects totaling $71 million. These
    include dorms at Cannon AFB, New Mexico; Joint Base McGuire-Dix-
    Lakehurst, New Jersey; Kapaun Annex, Germany; and Aviano AB, Italy. At
    Aviano, this single new dormitory will not only provide improved
    quality of life for Airmen, but also enable the Air Force to close an
    entire community support annex, which will yield savings in facility
    maintenance, energy, services, and security costs. Our 2010 Dormitory
    Master Plan, to be released later this year, will also address
    dormitories that we gain from Joint Basing.

                Military Family Housing
        Our fiscal year 2011 budget for military family housing is nearly
    $600 million. The Air Force request for housing construction investment
    is $78 million to ensure the continuous improvement of over 400 of our
    more than 16,100 overseas homes. Our request also includes an
    additional $514 million to fund operations, maintenance, utilities, and
    leases, and to manage privatized units for the family housing program.
        Housing privatization is central to the success of our stateside--
    including Alaska and Hawaii--military family housing initiatives. At
    the start of fiscal year 2011, we will have 38,800 privatized units, to
    be increased to 52,900 by the end of fiscal year 2011. As of the end of
    fiscal year 2009, privatization has leveraged a $423 million investment
    to $6.54 billion in development. We plan to privatize 100 percent of
    our family housing, in the Continental United States, by fiscal year
    2011.

                Child Development Centers
        Due to the elevated operations tempo in the past 8 years of
    conflict, child care for our families that remain stateside has become
    an increasingly significant focus area. As part of the American
    Recovery and Restoration Act, we have been able to allocate $80 million
    for eight new child development centers, to help ensure that our force
    has adequate child care capacity. We have aggressively pursued
    solutions to eliminate an earlier capacity issue, and we are on course
    to reduce our child care deficit to zero by 2012.
      modernize our air and space inventories, organizations, and training
        Modernizing our force to prepare for a wide range of future
    contingencies requires a significant investment. For fiscal year 2011,
    we are requesting $460 million for a variety of military construction
    projects, including:
      --Eight projects to prepare to beddown our newest fighter, the F-35.
            This includes four projects at Nellis AFB, Nevada, where we
            will accomplish a large part of the operational test and
            evaluation for this aircraft. As we continue to assess F-35
            program restructuring, we are closely analyzing the impacts
            that any delivery delays will have on associated military
            construction requirements.
      --Seven projects supporting our H/MC-130 fleet. These projects will
            emphasize the newer ``J'' models.
      --Six projects supporting F-22 operations. This effort will continue
            to modernize our air superiority fleet, including three
            projects at Hickam AFB, Hawaii, for the beddown of the Air
            National Guard squadron there.
      --Other projects. These will support diverse mission areas, including
            space control, C-5/C-17 maintenance, and base and airfield
            operations.

                             OTHER PROGRAMS OF NOTE

    Overseas Contingency Operations
        Our fiscal year 2011 Overseas Contingency Operations (OCO) request
    for military construction supports $280 million in projects for
    Afghanistan. This complements our fiscal year 2010 OCO request of $474
    million and our fiscal year 2010 OCO supplemental request of $279
    million to support the recently announced troop strength increase. The
    fiscal year 2011 OCO projects build upon and expand the operational
    capacity that was initially provided by the fiscal years 2009/2010
    requests. These first military construction requirements provided
    access to operational areas in the rugged, undeveloped regions of
    Afghanistan. Our subsequent requests will expand that initial
    capability by providing primary theater hubs in Afghanistan. As such,
    they will reduce safety risks, increase throughput capacity of cargo
    and personnel, and increase the effectiveness and efficiency of air
    operations. In addition to supporting current operations, logistical
    facilities are required to sustain operations through the transition to
    Afghan control and will facilitate the eventual redeployment of our
    forces. Each project will be of great value to the Joint team, and we
    are committed to executing them as effectively and efficiently as
    possible.

    BRAC 2005 Implementation
        The Office of the Secretary of Defense codified BRAC 2005
    implementation requirements and responsibilities through the use of
    business plans, a process that allows synchronization across the entire
    Department of Defense. The Air Force leads 64 business plans and is an
    equity partner in an additional 16.
        To implement the assigned recommendations, the Air Force's plan
    calls for the execution of nearly 400 separate actions utilizing a
    total budget that has been, and remains, fully funded at approximately
    $3.8 billion; two-thirds of this budget is military construction. Our
    BRAC military construction program will make its last contract award
    before the close of this fiscal year. In total, we will execute 231
    BRAC military construction (BRAC MILCON) projects, on 54 installations,
    in 36 States. The remaining segment of the BRAC budget funds
    environmental efforts, military personnel costs, training, and
    operations and maintenance-funded elements.
    BRAC 2005: The Air National Guard and Air Force Reserve
        Seventy-eight percent of BRAC 2005 implementation actions affect
    the Air Reserve components. This stands in contrast to BRAC 1995 where
    just eighteen percent of actions affected either the Air National Guard
    (ANG) or Air Force Reserve (AFR). Many of the BRAC 2005 actions
    realigned similar missions or aircraft models to increase the efficient
    use of manpower, resources, and maintenance budgets. Single mission
    tasks were combined into Centralized Intermediate Repair Facilities
    where ANG, AFR, and Active Duty personnel work side-by-side. The Air
    Force Reserve has effectively managed manpower resources and minimized
    adverse impacts on personnel at locations such as General Mitchell Air
    Reserve Station, Wisconsin. The relocated reserve unit from General
    Mitchell is now fully operational at Pope AFB, North Carolina. The Air
    National Guard has better positioned units to accept future missions in
    such vital tasks as Homeland Defense, is more effectively integrated
    with the Active Force in current front-line fighters, and will share
    opportunities to accept new weapons platforms.

    BRAC 2005: Execution Report Card
        BRAC 2005 impacts more than 120 Air Force installations. Whether
    establishing the F-35 Joint Strike Fighter Initial Training Site at
    Eglin AFB, Florida, closing Kulis Air Guard Station in Alaska, or
    transferring Pope AFB, North Carolina, to the Army, the Air Force
    community as a whole--Active, Guard, and Reserve--benefits from changes
    BRAC achieves. Among the seven closure installations, two are already
    considered closed while the others are proceeding according to plan.
    The Air Force is fully engaged in executing our requirements, nearly a
    third of assigned business plans are now considered complete and the
    rest are on schedule to complete by September 2011, completing
    implementation of BRAC 2005 on time and within budget.

    Legacy BRAC: Real Property Transformation
        The Air Force remains a Federal leader in the implementation of the
    management principles outlined in Presidential Executive Order 13327,
    Federal Real Property Asset Management. We continue to aggressively
    manage our real property assets to deliver maximum value for the
    taxpayer, improve the quality of life for our Airmen and their
    families, and ensure the protection and sustainment of the environment
    to provide the highest level of support to Air Force missions. The Air
    Force is achieving these goals through an enterprise-wide Asset
    Management transformation that seeks to optimize asset value and to
    balance performance, risk, and cost over the full asset life cycle. Our
    approach is fundamentally about enhancing our built and natural asset
    inventories and linking these inventories to our decision-making
    processes and the appropriate property acquisition, management and
    disposal tools.
        Even though the BRAC 2005 round did not substantially reduce the
    Air Force's real property footprint, our current transformation efforts
    seek to ``shrink from within'' and to leverage the value of real
    property assets in order to meet our ``20/20 by 2020'' goal of
    offsetting a 20 percent reduction in funds available for installation
    support activities by achieving efficiencies and reducing by 20 percent
    the Air Force physical plant that requires funds by the year 2020.

    Base Realignment and Closure Property Management
        To date, the Air Force has successfully conveyed by deed nearly 90
    percent of the 87,000 acres of Air Force land directed by BRAC 88, 91,
    93, and 95 with the remainder under lease for redevelopment and reuse.
    With the successful redevelopment of Air Force BRAC property, local
    communities have been able to increase the number of area jobs by over
    31,000.
        To complete the clean up and transfer by deed of remaining
    property, the Air Force is partnering with industry leaders on
    innovative business practices for its ``way ahead'' strategy. Of the 32
    legacy BRAC bases slated for closure, the Air Force completed 20 whole-
    base transfers. Eight of the remaining 12 bases are targeted for
    transfer by the end of fiscal year 2010, while the last 4 (Chanute,
    George, McClellan, Griffiss) will transfer no later than the end of
    fiscal year 2013.
        As the Air Force transfers BRAC property for civic and private
    reuse, it is paramount we ensure any past environmental contamination
    on the property does not endanger public health or the environment. The
    Air Force will continue to fulfill this most solemn responsibility, as
    reflected in our fiscal year 2010 request of $116 million for Legacy
    BRAC cleanup activities, and another $13 million for BRAC 2005 cleanup
    activities.

    Joint Basing
        The Air Force remains committed to joint basing initiatives to
    maximize installation efficiency, warfighting capability, and
    jointness, all the while saving taxpayer resources. Of the 12 joint
    bases mandated by BRAC 2005, 10 have Air Force equity, and we are the
    lead Service on six. All told, our current efforts with joint basing
    are proceeding smoothly, with no major issues. Three of the phase I
    joint bases with Air Force equity have already reached full operating
    capability status, and seven more phase II bases with Air Force equity
    have reached initial operating capability status, with full operating
    capability expected by October 1, 2010.

    Energy
        The Air Force understands the criticality of furthering energy
    security for the Nation, and we remain committed to realizing our
    energy goals of reducing demand, increasing supply, and changing our
    culture to make energy a consideration in everything we do. Energy
    conservation investment is a significant component of our newly
    released 2010 Air Force Infrastructure Energy Plan. In fiscal year
    2011, we will continue our energy conservation efforts, which have
    already reduced facility energy use 14.6 percent from our 2003
    baseline. The Defense military construction budget request of $120
    million contains $35 million for our Energy Conservation Investment
    Program, which will save--$124 million. In fiscal year 2009, we
    exceeded our goals and produced or procured 5.4 percent of our total
    facility energy through renewable sources, and we have led the Federal
    Government as the number one purchaser of renewable energy for the
    fifth year in a row. The 19 projects in the fiscal year 2011 Defense-
    wide military construction budget, including six solar projects, will
    continue this trend.

                                   CONCLUSION

        The Air Force is committed to the infrastructure projects that
    support our missions; we are also committed to ensuring we continue to
    care for our Airmen and their families, to include first-class
    dormitories and housing, and Airman and family support.
        We also remain committed to optimizing the utility of our resources
    through effective joint basing, completing BRAC actions, and continuing
    energy conservation efforts.
        Finally, the Air Force is committed to being good stewards of
    funding intended to ensure Air Force mission success.

        Senator Johnson. Thank you.
        Ms. Ferguson, what is the status of the Northern Group
    Housing Privatization Project especially with reference to
    Ellsworth Air Force Base?

                             NORTHERN GROUP HOUSING

        Ms. Ferguson. Senator Johnson, we are very close to being
    able to begin the process to put this on the street. We have
    one more meeting that has to occur. Once that occurs, our
    intent is to issue the required notice of intent for
    solicitation to the Hill. That needs to be over here for 30
    days, and then after that, we would anticipate issuing the
    request for qualifications. We are hopeful that we clear this
    last hurdle and be able to begin that within the next few
    weeks, and that will allow us to select an offeror as early as
    September, with a closure in June of next year.
        Senator Johnson. What are the options and what is the
    timeline if the Northern Group Privatization Project does not
    go forward?
        Ms. Ferguson. Sir, we would have to step back and look to
    see what other options were available. We have worked with your
    staff. We have six bases linked in the Northern Group, and what
    we have done is we have blended a mixture of healthy bases that
    have a significant investment in military construction, as well
    as other bases that still require investment. Overall, the Air
    Force invested about $600 million in those bases so far, but
    there is another $400 million that needs to be invested and we
    are hoping to leverage the private sector to do that. With an
    additional $5 million of investment from the Department of the
    Air Force, we are able to leverage $400 million from the
    private sector to get that work done. So we are very hopeful we
    will be able to move this project forward soon.

                            AIR FORCE RESERVE MILCON

        Senator Johnson. To Secretary Yonkers and General Commons:
    This year's budget request includes only one military
    construction project for the Air Force Reserve and the future
    years defense program does not look much better. This should be
    an embarrassment to the Air Force. While I acknowledge that
    there continue to be many demands and tight budgets, it would
    seem to me that this does not support the Air Force's
    commitment to the total Force.
        Secretary Yonkers, are you comfortable that this level of
    funding, $3.8 million for one project, is adequate for the Air
    Force Reserve?
        Mr. Yonkers. Thanks for your comments, Senator.
        I think the short answer is we are not comfortable, but we
    had to make some really difficult decisions in fiscal year 2011
    to try to balance amongst all the competing interests and
    programs in the Air Force.
        As I mentioned in my opening remarks, each one of the major
    commands, the Air Guard and the Air Force Reserve, got their
    number one priority project this year. Had we looked back and
    circled back in the deliberations this last year, we would have
    found, I think, a more equitable distribution of our military
    construction dollars to particularly the Air Force Reserve. We
    will look at that much more closely in this upcoming budget
    review to make sure that occurs and they get a more equitable
    distribution of those dollars.
        I would also say that even though the military construction
    program is small and it is not as robust as we would like to
    see it, we are augmenting it through the facilities sustainment
    modernization program. Those dollars are fairly hefty, and so
    our idea here as we go forward is to utilize those dollars to
    sustain those particularly aging infrastructure until such time
    as we can get robust in our military construction program.
        Senator Johnson. General Commons, would you like to comment
    on the Air Force Reserve request?
        General Commons. Thank you, Mr. Chairman.
        In the budget formulation for fiscal year 2011, as
    Secretary Yonkers mentioned, the Air Force decided to take
    increased risk in current mission, and as a result of that,
    they made a determination that every major command would be
    awarded their top priority in current mission, which for the
    Air Force Reserve was the Patrick Air Force Base project.
        Also, we had no new mission requirements, which was funded.
    They did not take as much risk in new mission. I think that led
    to some of the disparity, but funding just one of our projects
    per year will not address the $1.2 billion backlog we now have
    in the Air Force Reserve on current mission requirements, which
    directly impacts our readiness and our quality of life in the
    Reserve Command.
        I would also like to add, though, and thank this
    subcommittee from last year for the plus-up in the $120 million
    that was given to the Air Force Reserve in military
    construction which made fiscal year 2010 one of our most
    successful years in military construction. And I would like to
    thank the subcommittee for that.

                      ENERGY EFFICIENCIES WITHIN AIR FORCE

        Senator Johnson. Secretary Yonkers, I understand that the
    Air Force has a net zero energy effort underway at the Air
    Force Academy. Could you explain that effort and whether the
    Air Force has any plans to employ that model at other bases?
        Mr. Yonkers. I will try to answer that question, sir. I was
    not really prepared to.
        Across the Air Force, Net Zero is one of the objectives
    that we have with regard to achieving these kinds of energy-
    related, as well as greenhouse gas-related, potential impacts,
    depending upon what energy source you use. So the Air Force
    Academy is out in front with regard to that effort, and
    certainly those lessons learned will be applied to other air
    bases in the future. My intent is to meet exactly what the
    President has asked us to meet, both President Bush, during his
    administration, and President Obama during this administration,
    with regard to hitting those kinds of carbon sequestration and
    carbon balance topics or objectives, while at the same time,
    aggressively pursue renewable energy at our installations.
        Senator Johnson. I will ask you the same question I asked
    the Army. Could you provide the subcommittee with a list of
    potential ECIP projects that could be executed in fiscal year
    2011?
        Mr. Yonkers. Yes, sir, we would be happy to do that.
        [The information follows:]

        The following are the potential unfunded ECIP projects for the Air
    Force:

                                                 [Dollars in thousands]
    ----------------------------------------------------------------------------------------------------------------
                                          Installation/                                                 Programmed
                  MAJCOM                     activity              State         Project description      amount
    ----------------------------------------------------------------------------------------------------------------
    USAFE............................  Ramstein...........  GE.................  Install                        $765
                                                                                  Photovoltaic
                                                                                  System.
    USAFE............................  Ramstein...........  GE.................  Install                         719
                                                                                  Photovoltaic
                                                                                  System.
    USAFE............................  Ramstein...........  GE.................  Install                         520
                                                                                  Photovoltaic
                                                                                  System.
    USAFE............................  Ramstein...........  GE.................  Install                         494
                                                                                  Photovoltaic
                                                                                  System.
    ANG..............................  Atlantic City......  NJ.................  Photovoltaic                  3,700
                                                                                  Generation System.
    AMC..............................  McGuire............  NJ.................  (MEBI) Install                1,519
                                                                                  Solar Panels at
                                                                                  Fitness Center.
    USAFE............................  Lajes Field........  PO.................  Replace & Upgrade             1,110
                                                                                  Water SCADA & EMCS.
    USAFE............................  Lajes Field........  PO.................  Repair Water                    600
                                                                                  Service Lines,
                                                                                  Multi.
    USAFE............................  Moron..............  SP.................  Install Non Potable           1,200
                                                                                  Water System.
    ACC..............................  Eglin..............  FL.................  Leak Detection &                750
                                                                                  Repair.
    AETC.............................  Tyndall............  FL.................  Reclaimed Water               3,255
                                                                                  Irrigation.
    AFSC.............................  Thule..............  GR.................  EMCS...............           4,500
    PACAF............................  Elmendorf..........  AK.................  HVAC Retro                    2,830
                                                                                  commission Ph-1.
    ACC..............................  Eglin..............  FL.................  DDC Energy Mgnt               6,724
                                                                                  System Upgrade.
    AFMC.............................  Hanscom............  MA.................  Repair Chiller                1,950
                                                                                  Controls B1201.
    ACC..............................  Grand Forks........  ND.................  Replace Interior              1,316
                                                                                  Lighting.
    AETC.............................  Randolph...........  TX.................  Cns Chiller/TES               1,200
                                                                                  Plant.
    AFMC.............................  Arnold.............  TN.................  Test Area Energy                821
                                                                                  Improvements.
    ACC..............................  Mountain Home......  ID.................  Repair Infrared               1,180
                                                                                  Heaters, Multi
                                                                                  facilities.
    AETC.............................  Randolph...........  TX.................  B395 Thermal Energy           1,527
                                                                                  Storage (TES).
    AETC.............................  Lackland...........  TX.................  Construct a Chiller/          2,800
                                                                                  TES Plant.
    AETC.............................  Lackland...........  TX.................  Install Thermal               1,110
                                                                                  Storage Energy
                                                                                  Tank B7429.
    AFMC.............................  Kirtland...........  NM.................  ECIP Solar-LED                1,850
                                                                                  Retrofits for
                                                                                  Street, Parking &
                                                                                  Runway Lights.
    AMC..............................  McGuire............  NJ.................  (MEBI) Install                1,519
                                                                                  Solar Panels @
                                                                                  Fitness Center.
    AMC..............................  McGuire............  NJ.................  Install Solar Wall            1,150
                                                                                  Bldgs 3210/3211/
                                                                                  3101.
    AFSPC............................  Los Angeles........  CA.................  ECIP--Photo Voltaic           1,082
                                                                                  System, B/286,
                                                                                  Fitness Center
                                                                                  Roof.
    AFSPC............................  Los Angeles........  CA.................  Solar Roof System,            1,050
                                                                                  B/271, LAAFB.
    AFSPC............................  Los Angeles........  CA.................  Solar Roof System,            1,050
                                                                                  B/270, LAAFB.
    AFSPC............................  Los Angeles........  CA.................  Solar Roof System,            1,442
                                                                                  B/272, LAAFB.
    AFSPC............................  Los Angeles........  CA.................  ECIP--Photo Voltaic           1,347
                                                                                  Parking Canopy,
                                                                                  South, LAAFB.
    AFSPC............................  Los Angeles........  CA.................  ECIP--Photo Voltaic           2,191
                                                                                  Parking Canopy,
                                                                                  West, LAAFB.
    AFSPC............................  F.E. Warren........  WY.................  Decentralize Base            14,008
                                                                                  Central Heat Plant.
    AFMC.............................  Hill Air Force       UT.................  ECIP--Conv & RPR              2,365
                                        Base.                                     1700 Area Bldgs &
                                                                                  Dist Sys To
                                                                                  Natural Gas.
    AFSPC............................  Cape Cod Air Force   MA.................  Install Two Wind             13,000
                                        Station.                                  Turbines/Support
                                                                                  System.
    ----------------------------------------------------------------------------------------------------------------

        Senator Johnson. Senator Collins.
        Senator Collins. Thank you, Mr. Chairman.

                                  MAINE MILCON

        General Moisio, as I was preparing for this hearing, I
    noted that the fiscal year 2011 budget proposal contains
    requests from the Air National Guard for funding for two
    military construction projects that include two new SCIFs, the
    secure facilities, at a cost of $9.6 million to the taxpayers.
        Ms. Ferguson, I also noted that the Air Force has proposed
    spending more than $221 million on six military construction
    projects that include six new SCIFs.
        At the Air National Guard base in Bangor, Maine, there is a
    28,000 square foot facility that meets all the requirements to
    be a SCIF, but the Air Force will not certify the facility as a
    SCIF until a mission is identified for that building.
        My question, however, is did the Air National Guard review
    current assets, including this facility in Maine, before
    proposing the funding to build brand new additional secure
    facilities?
        General Moisio. Thank you, Senator Collins.
        Yes. We, of course, keep track of all of our $14 billion
    worth of plant value across the Nation and consider it all in
    new mission lay-down. The important thing to understand about
    the new mission lay-down that we are in right now--much of it
    is a result of BRAC. Much of it as a result of other changing
    missions, drawdown in Force structure, and so on, which has not
    affected the 101st, as you know, up in Bangor. They have a
    good, stable tanker mission and will continue to have that
    mission for a long time.
        As time goes on, ma'am, when we continue to have to lay
    down across the Air Force missions that require classified
    facilities--also communication infrastructure is becoming a
    very important aspect--we do consider the existing facilities
    and the existing communication infrastructure when we go
    through our basing actions, as Ms. Ferguson, who runs that
    program, can attest. So it is a factor, ma'am.
        Senator Collins. Secretary Ferguson, was that facility
    considered as the Air Force was putting together its request
    for six additional secure areas?
        Ms. Ferguson. I will have to go back and look at those
    particular six projects, but as General Moisio points out,
    under the new Air Force strategic basing process, that is one
    of the things we consider as we beddown new missions across the
    Air Force.
        Senator Collins. I would encourage both of you to take a
    look at that facility because if it does meet your needs, we
    should use current assets and save some money in this very
    tight budget environment. And I know that you share that
    concern as well.
        [The information follows:]

        After significant reductions in requirements due to the end of the
    cold war, the Air National Guard has reused the majority of the SCIF
    facility. Of the 34,000 square feet, only 6,100 square feet remain
    vacant. Each of the military construction projects with SCIF
    requirements is associated with an existing mission and are already
    established at their current installations. For these current mission
    military construction projects, the benefit of reutilizing an existing
    SCIF at Bangor, Maine is out-weighed by the high cost associated with
    moving the missions to another installation. However, as we previously
    discussed, under the new Air Force strategic basing process, Bangor,
    Maine will be considered as we beddown new missions across the Air
    Force in the future.

        Senator Collins. General, it sounds like you are very aware
    of the role that the air refueling wing of the Air National
    Guard in Maine has been playing in maintaining our air bridge
    to support our warfighters in Iraq and Afghanistan. The last
    time I visited the base, I was told that they actually offload
    more fuel than any other unit on the entire east coast,
    including Active Duty units with the exception of MacDill Air
    Force Base in Florida. So they are playing an absolutely
    essential role. Indeed, if you look just at Guard units, they
    offload more fuel to military aircraft than any other Guard
    unit in the country.
        As you begin the process of deciding where to place the KC-
    X aircraft, the tanker that we desperately need to proceed
    with, will one of the primary considerations for basing include
    which aircraft in the inventory are most frequently relied upon
    to support wartime efforts? General?
        General Moisio. Senator Collins, your support of the 101st
    is admirable, as is the case across the Nation with our Guard
    units. It is one thing that makes the job that I have so great,
    is to hear the pride of Senators and Congressmen regarding
    their Guard units.
        It is a true statement that the 101st is tops on the east
    coast in offload. It makes sense, closest to the air bridge
    across the Atlantic. So a very, very strategic point for us to
    have a tanker unit in the Air National Guard, and there is, I
    would hope, little doubt in my mind that that would continue
    for a long, long time.
        In terms of competing for KC-X, I believe that the
    Northeast Tanker Task Force will undoubtedly be involved in
    some way in the initial beddown of KC-X. We will go through the
    normal basing process, and in my mind, the most important
    attribute of the 101st that will show up in the basing process
    is its location and the fact of the Northeast Tanker Task
    Force. So the competition will be fair. It will be transparent,
    and I know that the 101st in Bangor will compete.
        Senator Collins. Thank you. Thank you, Mr. Chairman. Thank
    you all.
        Senator Johnson. Senator Murkowski.
        Senator Murkowski. Thank you, Mr. Chairman.

                   ENERGY EFFICIENCY AT ALASKA INSTALLATIONS

        Secretary Yonkers, I understand that you are in the process
    now of preparing a paper for me at my request on the future of
    the Polar Star Housing. This is the privatized housing in
    Eielson. I will look forward to receiving that paper and the
    opportunity for future dialogue on that. We would like to see,
    of course, positive resolution of this, but I understand that
    that is something that you are working to produce for me. So I
    will look forward to that. And I do not know. It looks like
    you, Secretary Ferguson, will be the one that will be working
    on it.
        Mr. Yonkers. Actually she is the one that works these types
    of military family housing privatization issues, and I would be
    completely lost without her, as you probably know.
        I mean, there is much more to come, and we will be more
    than happy to not only provide the paper but respond to any
    questions, concerns, Madam, that you have.
        Senator Murkowski. I appreciate that.
        Let me ask you. You have mentioned the impact of energy
    usage and what we do to deal with our high energy costs.
    Congress had appropriated some substantial funding for the Air
    Force to consider locating a coal-to-liquids plant on or near
    Eielson to take advantage of the coal reserves that we have in
    interior Alaska and offer the Air Force an alternative source
    of jet fuel.
        We have, of course, heard that the concept of coal-to-
    liquids, which was really quite popular in the last
    administration, has now kind of gone out of vogue within this
    administration, even if we can address the carbon capture
    issues.
        The question to you this morning is whether the Air Force
    intends to pursue a coal-to-liquids plant at Eielson and what
    is the timeline then for any decision-making in this order.
        Mr. Yonkers. Ma'am, thank you for your question, and I know
    you are personally very interested in this and your
    observations are right on target with regard to coal-to-liquid.
        You know very well, I am sure, that the earmarks that we
    received are being utilized for the purposes under which they
    were intended to look at the feasibility and financial
    viability of a coal-to-liquids facility at or near Eielson. We
    are already in the process, as you probably know as well, of
    looking at the business case analysis particularly to see if an
    enhanced use lease would be appropriate for such activities and
    be financially viable for such activities.
        In conjunction with that, the civil engineering squadron
    there is looking at the mission impacts and the environmental
    impact analysis to pull that information together.
        And then the Air Force research labs down at Wright
    Patterson are considering things such as carbon sequestration
    and how that will play amongst the energy alternatives as we
    look at the broad scope of whether or not coal-to-liquid is
    really a viable option there at Eielson.
        Once we get the information from those reports back and we
    can massage that a bit, and if we do, in fact, find that it is
    a viable alternative, our intent is to get with the Department
    of Defense, along with, we hope, prospective developers,
    companies that would be interested in implementing this, and
    see where we go from there.
        Senator Murkowski. Well, we would like to work with you on
    this. Obviously, the cost of energy is a key issue up there,
    but even more so, the opportunity to provide the Air Force with
    a fuel source that could be ready and affordable is something
    that we all want to focus on.
        Mr. Yonkers. Yes, ma'am.

                             NEW TANKERS IN ALASKA

        Senator Murkowski. General, let me ask you. You spoke about
    the possibility of the KC-X for the 101st there in Maine. Does
    the same possibly apply to the 168th Wing at Eielson which has
    the significant responsibility for fueling in the Pacific?
        General Moisio. Absolutely, ma'am. I really should let Ms.
    Ferguson address the overall process, but hopefully you all are
    aware of the process that the Air Force has adopted over the
    last year to base new systems. But the process is open,
    transparent, repeatable, and when we are bedding down a system
    such as F-35s, such as KC-X soon, we look enterprise-wide at
    Air Force bases and grade them on a set of criteria that are
    developed by the gaining major command. And I am convinced that
    it is a very fair process.
        Senator Murkowski. One final question, and this is your
    soft ball for the morning and gives you a chance to do a little
    bit of bragging. In just a few weeks here, the Elmendorf Air
    Force Base is slated to receive the Commander-in-Chief Award
    from the Secretary of Defense. This is a pretty big deal. We
    certainly feel so. As one who represented Elmendorf in our
    State legislature, it is even more a particular point of pride.
    But it really means that Elmendorf is truly the best of the
    best in the Air Force.
        So the question to you this morning, Secretary, is what did
    Elmendorf do to achieve this distinction, and how will the Air
    Force celebrate Elmendorf's accomplishments?
        Mr. Yonkers. Well, you know, I will go back to some of the
    previous conversations with the pride and enthusiasm that you
    all bring to the table with regard to those air bases that are
    in your State. It is really gratifying to me as sort of a
    retread coming back into the Air Force just recently to see
    this. I mean, this was one of the things that I really missed
    when I left 8 years ago.
        It is a big deal. It is truly a big deal for Elmendorf to
    be able to go through a rigorous competition amongst every air
    base that we have in the 50 States and all those major
    commands. There are 166 air bases that Elmendorf was in the mix
    with. And as you say, Senator, Elmendorf came out on top.
        There is going to be at least one, if not several award
    assemblies that are going to recognize that accomplishment.
    When those folks from Elmendorf stand up in front of the
    Secretary and the Chief and receive that award, I think it is
    going to be a great day and there is going to be just a lot of
    fun and enthusiasm and pride from the people down at the
    installation level that made that happen.
        Senator Murkowski. We look forward to recognizing their
    accomplishments because they are significant. They are
    receiving the Commander in Chief Award, but this has been a
    pretty good year for them. They have received a whole handful
    of national recognitions, and we are really quite proud, as we
    are of all our men and women in uniform, but there are
    significant accomplishments that we want to celebrate. So thank
    you.
        Thank you, Mr. Chairman.
        Mr. Yonkers. Thank you, ma'am.
        Senator Johnson. Thank you.
        I would like to thank all of our witnesses for appearing
    before the subcommittee today. We look forward to working with
    you this year.
        For the information of members, questions for the record
    should be submitted by the close of business on April 29.

                             CONCLUSION OF HEARINGS

        Senator Johnson. This hearing is recessed.
        [Whereupon, at 11:06 a.m., Thursday, April 22, the hearings
    were concluded, and the subcommittee was recessed, to reconvene
    subject to the call of the Chair.]

           LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                                  ----------
                                                                       Page

    Baker, Roger W., Assistant Secretary for Information and
      Technology, Department of Veterans Affairs.....................    59
    Boozer, Brigadier General James C., Sr., Director of Operations,
      Office of the Assistant Chief of Staff (Installation
      Management), Department of the Army, Department of Defense.....   109
        Prepared Statement of........................................   113
        Questions Submitted to.......................................   132
    Byrd, Senator Robert C., U.S. Senator From West Virginia,
      Questions Submitted by.........................................    92

    Calcara, Joseph F., Deputy Assistant, Secretary of the Army
      (Installations and Housing), Department of the Army, Department
      of Defense.....................................................   109
        Prepared Statement of........................................   113
        Questions Submitted to.......................................   130
    Carpenter, Major General Raymond W., Acting Director, Army
      National Guard, Department of the Army, Department of Defense..   109
        Prepared Statement of........................................   113
    Collins, Senator Susan, U.S. Senator From Maine, Questions
      Submitted by..................................................32, 107
    Commons, Major General David L., Mobilization Assistant to the
      Chief, Air Force Reserve, Department of the Air Force,
      Department of Defense..........................................   135

    Ferguson, Kathleen I., Deputy Assistant Secretary
      (Installations), Department of the Air Force, Department of
      Defense........................................................   135

    Grams, W. Todd, Acting Assistant Secretary for Management and
      Chief Financial Officer, Department of Veterans Affairs........    59

    Hale, Hon. Robert F., Under Secretary of Defense (Comptroller),
      Department of Defense..........................................     1
        Prepared Statement of........................................     5
        Questions Submitted to.......................................    30
        Summary Statement of.........................................     4
    Hansen, Louis Jerome, Deputy Assistant Secretary of the Army
      (Strategic Infrastructure) and Senior Official Performing
      Duties of Assistant Secretary of the Army (Installations and
      Environment), Department of the Army, Department of Defense....   109
        Prepared Statement of........................................   113
        Questions Submitted to.......................................   129
        Summary Statement of.........................................   111
    Hutchison, Senator Kay Bailey, U.S. Senator From Texas:
        Prepared Statements of......................................61, 110
        Questions Submitted by..................................30, 34, 100
        Statements of................................................ 2, 60

    Inouye, Senator Daniel K., U.S. Senator From Hawaii, Questions
      Submitted by...................................................    89

    Johnson, Senator Tim, U.S. Senator From South Dakota:
        Opening Statements of....................................1, 59, 109
        Questions Submitted by.....................52, 55, 56, 88, 129, 130

    Landrieu, Senator Mary L., U.S. Senator From Louisiana, Questions
      Submitted by........................................91, 130, 131, 132

    McConnell, Senator Mitch, U.S. Senator From Kentucky, Questions
      Submitted by..................................................33, 103
    Mitchell, Derek, Principal Deputy Assistant Secretary for Asian
      and Pacific Security Affairs, Office of the Secretary,
      Department of Defense..........................................     1
        Questions Submitted by.......................................    34
    Moisio, Major General Patrick J., Deputy Director, Air National
      Guard, Department of the Air Force, Department of Defense......   135
    Mossey, Rear Admiral Christopher J., Director of Shore Readiness,
      Department of the Navy, Department of Defense..................    35
        Prepared Statement of........................................    36
        Question Submitted to........................................    56
    Muro, Steve L., Acting Under Secretary for Memorial Affairs,
      National Cemetery Administration, Department of Veterans
      Affairs........................................................    59
    Murray, Senator Patty, U.S. Senator From Washington, Questions
      Submitted by...................................................    96

    Natsuhara, Hon. Roger M., Acting Assistant Secretary
      (Installations and Environment), Department of the Navy,
      Department of Defense..........................................    35
        Prepared Statement of........................................    36
        Questions Submitted to.......................................    52
        Summary Statement............................................    35

    Payne, Major General Eugene G., Jr., Assistant Deputy Commandant
      (Installations and Logistics), Department of the Navy,
      Department of Defense..........................................    35
        Prepared Statement of........................................    36
        Questions Submitted to.......................................    55
    Petzel, Hon. Robert A., M.D., Under Secretary for Health,
      Veterans Health Administration, Department of Veterans Affairs.    59

    Reed, Senator Jack, U.S. Senator From Rhode Island, Questions
      Submitted by...................................................    53
    Robyn, Dorothy, Deputy Under Secretary of Defense (Installations
      and Environment), Office of the Secretary, Department of
      Defense........................................................     1
        Prepared Statement of........................................     8
        Questions Submitted to.......................................    33
        Summary Statement of.........................................     7

    Shinseki, Hon. Eric K., Secretary, Department of Veterans Affairs    59
        Prepared Statement of........................................    65
    Snyder, James, Assistant Chief, Army Reserve, Department of the
      Army, Department of Defense....................................   109
        Prepared Statement of........................................   113

    Walcoff, Michael, Acting Under Secretary for Benefits, Veterans
      Benefits Administration, Department of Veterans Affairs........    59

    Yonkers, Hon. Terry A., Assistant Secretary (Installations,
      Environment and Logistics), Department of the Air Force,
      Department of Defense..........................................   135
        Prepared Statement of........................................   137

                                 SUBJECT INDEX

                                  ----------

                             DEPARTMENT OF DEFENSE

                          Department of the Air Force

                                                                       Page

    Air Force Reserve Milcon.........................................   143
    Continue to Strengthen the Nuclear Enterprise....................   138
    Develop and Care for Airmen and Their Families...................   139
    Energy Efficiencies Within Air Force.............................   144
    Energy Efficiency at Alaska Installations........................   147
    Maine Milcon.....................................................   145
    Modernize Our Air and Space Inventories, Organizations, and
      Training.......................................................   140
    New Tankers in Alaska............................................   148
    Northern Group Housing...........................................   142
    Other Programs of Note...........................................   140
    Partner With the Joint and Coalition Team to Win Today's Fight...   138

                             Department of the Army

    Additional Committee Questions...................................   129
    Alaska Milcon....................................................   126
    Army:
        Family Housing:
            Construction.............................................   117
            Operations...............................................   118
        Imperatives and Facility Initiatives.........................   114
        National Guard...............................................   125
            And Army Reserve.........................................   111
    Barracks Privatization....................................130, 131, 132
    Budget Realignment and Closure (BRAC):
        Property Conveyance..........................................   122
        95...........................................................   118
        2005.........................................................   118
    Energy:
        Conservation Investment Program..............................   130
        Efficiency Improvement.......................................   129
        Security...................................................120, 129
    Facilities Strategic Context.....................................   114
    Fiscal Year 2011:
        Budget Request...............................................   115
        Milcon Overview..............................................   115
    Global Defense Posture...........................................   110
    Homeowners Assistance Program (HAP).......................119, 120, 130
    Military:
        Construction (Milcon):
            Army.....................................................   115
                Reserve..............................................   117
            National Guard...........................................   116
        Housing Privatization........................................   128
    Overseas Contingency Operations..................................   119
    Pine Bluff Arsenal...............................................   124
    Quadrennial Defense Review (QDR).................................   110

                             Department of the Navy

    Additional Committee Questions...................................    52
    Base Realignment and Closure (BRAC)..............................    36
        2005 Implementation..........................................    48
    Energy...........................................................36, 52
        Reform.......................................................    41
    Facilities Management............................................    40
    Family Housing...................................................36, 42
    Fully Funded and Incrementally Funded Milcon Projects............    39
    Guam.........................................................35, 51, 53
    Housing..........................................................    42
    Installations....................................................    35
    Meeting the Construction Execution Challenge.....................    50
    Military Construction............................................    38
    Prior BRAC Cleanup and Property Disposal.........................    46
    Relocating the Marines to Guam...................................    44
    The Navy's Investment in Facilities..............................    36

                       Office of the Secretary of Defense

    Additional Committee Questions...................................    29
    American Recovery and Reinvestment Act...........................     7
    Base:
        Budget.......................................................     5
        Realignment and Closure (BRAC)...............................    11
    Closure of NAS Brunswick.........................................    18
    Economic Development Conveyance..................................    18
    Facilities Sustainment and Recapitalization......................    14
    Family Housing and Barracks......................................    12
    Guam.............................................................26, 28
    Homeowners Assistance Program....................................    13
    Housing at Fort Wainwright.......................................    21
    Improvements to Guam Port........................................    23
    International Basing.............................................    10
    Little Rock Air Force Base.......................................    21
    Managing Our Energy Use..........................................    15
    Military Construction............................................     9
        And Family Housing...........................................     6
        BRAC and Family Housing......................................     9
    Moving:
        Marines to Guam..............................................    28
        Prisoners From Guantanamo Bay................................    29
    Office of Economic Adjustment....................................    19
    Overseas:
        Basing Commission............................................    23
        Contingency Operations....................................... 6, 10
    Undocumented Workers at Elmendorf Air Force Base.................    22

                         DEPARTMENT OF VETERANS AFFAIRS

    Additional Committee Questions...................................    88
    Advance Appropriations for Medical Care in 2012..................    69
    Capital Infrastructure...........................................    71
    Claims Backlog...................................................    72
    Delivering World-Class Medical Care..............................    68
    Electronic Health Record.........................................    85
    Enhancing Our Management Infrastructure..........................    71
    Fort Bliss Joint Facilities......................................    75
    G.I. Bill........................................................    83
    High Priority Performance Goals (HPPG):
        I: Reducing the Claims Backlog...............................    65
        II: Eliminating Veteran Homelessness.........................    66
        III: Automating the GI Bill Benefits System..................    67
        IV: Establishing a Virtual Lifetime Electronic Record........    67
        V: Improving Mental Health Care..............................    67
        VI: Deploying a Veterans Relationship Management System......    68
    Investments in Medical Research..................................    70
    Joint Ventures...................................................    86
    Leveraging Information Technology................................    70
    Omaha VAMC.......................................................    76
    Presumptive Diseases.............................................    74
    Rural Access.....................................................77, 83
    Sustaining High Quality Burial and Memorial Programs.............    70
    Veteran Suicides.................................................    81
    Veterans:
        Cemetery.....................................................    77
        Veterans Employment..........................................    79

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