[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



                                     

                         [H.A.S.C. No. 112-126]
 
                         ARMY AND MARINE CORPS

                             MATERIEL RESET

                               __________

                                HEARING

                               BEFORE THE

                       SUBCOMMITTEE ON READINESS

                                 OF THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                              HEARING HELD

                             MARCH 28, 2012


                                     
[GRAPHIC] [TIFF OMITTED] TONGRESS.#13

                                     





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                       SUBCOMMITTEE ON READINESS

                  J. RANDY FORBES, Virginia, Chairman
MIKE ROGERS, Alabama                 MADELEINE Z. BORDALLO, Guam
JOE HECK, Nevada                     SILVESTRE REYES, Texas
AUSTIN SCOTT, Georgia                JOE COURTNEY, Connecticut
FRANK A. LoBIONDO, New Jersey        DAVE LOEBSACK, Iowa
CHRIS GIBSON, New York               LARRY KISSELL, North Carolina
VICKY HARTZLER, Missouri             BILL OWENS, New York
BOBBY SCHILLING, Illinois            TIM RYAN, Ohio
JON RUNYAN, New Jersey               COLLEEN HANABUSA, Hawaii
TIM GRIFFIN, Arkansas                JACKIE SPEIER, California
STEVEN PALAZZO, Mississippi
MARTHA ROBY, Alabama
                Ryan Crumpler, Professional Staff Member
               Vickie Plunkett, Professional Staff Member
                    Nicholas Rodman, Staff Assistant



                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2012

                                                                   Page

Hearing:

Wednesday, March 28, 2012, Army and Marine Corps Materiel Reset..     1

Appendix:

Wednesday, March 28, 2012........................................    19
                              ----------                              

                       WEDNESDAY, MARCH 28, 2012
                  ARMY AND MARINE CORPS MATERIEL RESET
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

Bordallo, Hon. Madeleine Z., a Delegate from Guam, Ranking 
  Member, Subcommittee on Readiness..............................     2
Forbes, Hon. J. Randy, a Representative from Virginia, Chairman, 
  Subcommittee on Readiness......................................     1

                               WITNESSES

Mason, LTG Raymond V., USA, Deputy Chief of Staff, Logistics, G-
  4, U.S. Army...................................................     4
Panter, LtGen Frank A., Jr., USMC, Deputy Commandant, 
  Installations and Logistics Headquarters, U.S. Marine Corps....     5

                                APPENDIX

Prepared Statements:

    Forbes, Hon. J. Randy........................................    23
    Mason, LTG Raymond V.........................................    25
    Panter, LtGen Frank A., Jr...................................    36

Documents Submitted for the Record:

    [There were no Documents submitted.]

Witness Responses to Questions Asked During the Hearing:

    [There were no Questions submitted during the hearing.]

Questions Submitted by Members Post Hearing:

    Mr. Forbes...................................................    47
    Mr. Rogers...................................................    54
                  ARMY AND MARINE CORPS MATERIEL RESET

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
                                 Subcommittee on Readiness,
                         Washington, DC, Wednesday, March 28, 2012.
    The subcommittee met, pursuant to call, at 3:00 p.m. in 
room 2212, Rayburn House Office Building, Hon. J. Randy Forbes 
(chairman of the subcommittee) presiding.

  OPENING STATEMENT OF HON. J. RANDY FORBES, A REPRESENTATIVE 
       FROM VIRGINIA, CHAIRMAN, SUBCOMMITTEE ON READINESS

    Mr. Forbes. First of all, I would like to welcome all of 
our members and our distinguished panel of experts to today's 
hearing, focused on materiel reset. I want to, at the outset, 
apologize to both of you for the delay and thank you for being 
patient with us as we work through these votes that we had on 
the floor.
    And I want to thank our witnesses for being with us this 
afternoon. General Mason, I understand this is your first time 
testifying in your new capacity as the deputy chief of staff of 
the Army for logistics, and we want to welcome you and look 
forward to your service in that position.
    And we also understand, General Panter, that this is likely 
your last time to testify before this subcommittee before your 
retirement. And we just want to tell you what an honor it is to 
have you here, and thank you for the honorable service that you 
have given to this country and the service that you have 
rendered to our Nation.
    I believe it is important that you are all here with us 
today. Resetting our force is a strategic imperative and one 
that will require continued commitment from this subcommittee 
and this Congress beyond combat operations. In light of 
shrinking defense budgets, the Budget Control Act's looming 
sequestration, and the Administration's announcement of an 
accelerated drawdown in Afghanistan I believe this hearing is 
very timely.
    Last year, we spent a great deal of time exploring our 
current state of readiness and discussing how we remain 
prepared to meet the challenges we are likely to face in the 
future. Time and again, we heard of a force that General 
Breedlove described as being on the ragged edge. We learned 
that one of the major drivers behind this degraded force was a 
lack of materiel readiness.
    Today, we again explore readiness. This time in the context 
of reset and its importance to ensuring a capable future force. 
Complicating this effort is the reduction of $754 billion in 
the Department of Defense's 10-year budget, leading the DOD 
[Department of Defense] to cancel many of its most advanced 
systems, like the CG(X) next-generation cruiser program, the F-
22, and the Army's future combat system.
    DOD has also made tough decisions on force structure and 
civilian personnel, shrinking the Marine Corps by more than 
25,000 marines, the Active Army by 72,000 soldiers. In short, 
this means that resetting the force is now more important than 
ever. The Administration is arguing that we can afford a 
smaller force, one with less capacity, as long as we have a 
more capable force.
    Let us be clear that failure to reset the force undermines 
this position, and will leave us with a smaller and less 
capable force. If we do not get this right, the implications 
will be far-reaching and long-lasting. Many tough decisions 
still lie ahead, and I remain concerned that because the 
Department has not begun planning for a possible sequestration 
we only have a small sense of how truly catastrophic 
sequestration could be.
    We all have a responsibility to ensure our men and women in 
uniform are given the tools necessary for the job we have asked 
them to do. I look forward to learning more about reset and its 
importance to the warfighter.
    And I would now like to turn to my friend and ranking 
member, Madeleine Bordallo, the gentlewoman from Guam, for any 
remarks she may have.
    [The prepared statement of Mr. Forbes can be found in the 
Appendix on page 23.]

STATEMENT OF HON. MADELEINE Z. BORDALLO, A DELEGATE FROM GUAM, 
           RANKING MEMBER, SUBCOMMITTEE ON READINESS

    Ms. Bordallo. Thank you very much, Mr. Chairman. General 
Mason, General Panter, we all appreciate your service and we 
look forward to your testimonies this afternoon. I want to 
congratulate you, General Mason, on your promotion. And also to 
you, General Panter, good luck as you enter into retirement.
    Today, we explore the issues and the challenges surrounding 
the reset of Army and Marine Corps equipment after more than a 
decade of war. We have surged hundreds of thousands of pieces 
of equipment from units and depots in the United States to 
locations across the Middle East in support of operations in 
Iraq and Afghanistan.
    Now that the war in Iraq is over, we are still dealing with 
the challenges of moving equipment from locations in Kuwait 
back to units who need this equipment for training and to 
perform new missions. So it is important for our committee 
members to understand the challenges with returning this 
equipment from Iraq to units at home.
    How do the Army and the Marine Corps prioritize equipment 
reset among many competing interests and units--from home 
station units to foreign military sales--and what is the 
underlying strategy? I am concerned that National Guard units 
in the United States will end up with significant equipment 
shortfalls, and thus hinder their ability to respond to 
domestic, homeland defense requirements.
    And how is this specific concern being addressed, 
especially by the Army? And I also hope that General Panter can 
elaborate on the Marine Corps process for reset, and how they 
are addressing readiness issues with the III MEF [III Marine 
Expeditionary Force]. As we pivot to the Asia-Pacific region, 
it is more important than ever that we make the III MEF whole 
again and ensure that they have the proper equipment to meet 
current and emerging requirements in this theater over the 
coming years.
    In terms of whether to repair, rebuild, or replace, how do 
you assess what equipment now being used in Afghanistan is 
appropriate for the challenges that exist in the Asia-Pacific 
region? Additionally, our hearing will explore some of the 
challenges involved with retrograde of equipment from 
Afghanistan and its return to the United States for reset.
    Given the inability to move equipment across Pakistan 
ground routes, how is the Department posturing itself to ensure 
equipment can flow by strategic airlift through the northern 
distribution network? The fiscal year 2013 president's budget 
request outlines some significant changes to the Air Force's 
strategic and tactical airlift capabilities.
    I am concerned what impact some these changes will have on 
our ability to move equipment out of Afghanistan in a timely 
fashion. And we must understand that retrograde and the reset 
of equipment from Afghanistan is going to be a vastly different 
endeavor than the reset of equipment from Iraq because of the 
transportation challenges and the lack of a holding area, such 
as we had for Iraq with Kuwait.
    It is important for members of our committee to understand 
this important distinction as we assess the adequacy of budgets 
and the strategic value of recent budgetary recommendations of 
Congress. And I also hope our hearing will make clear the 
further complication and the challenges posed by ever-
increasing gas prices, especially given our reliance on airlift 
for reset in Afghanistan.
    I know that tomorrow we will explore the issue of alternate 
energy and its potential benefit to rising gas prices. However, 
I do remain concerned that if we don't continue efforts to look 
at alternate energy for operational purposes we will be 
assuming even more significant risk in reset in Afghanistan.
    So I hope that our witnesses can touch on this matter in 
their testimony, as well. And I also hope our witnesses can 
comment on what is being done at our Army and Marine Corps 
depots to sustain workload over the coming years, as we 
continue to reset equipment coming out of Iraq and Afghanistan.
    And I again thank you, Mr. Chairman, and I look forward to 
our witnesses' testimony and our question and answer period.
    Mr. Forbes. Thank you, Madeleine, for those remarks.
    As we discussed prior to the hearing, I would like to 
dispense with the 5-minute rule for this hearing and depart 
from regular order so that members may ask questions during the 
course of the discussion. I think this will provide a 
roundtable type forum and will enhance the dialogue on these 
very important issues.
    We would like to proceed with standard order for members to 
address the witnesses. However, if any member has a question 
pertinent to the matter being discussed at that time, please 
seek acknowledgment and wait to be recognized by the chair. We 
are planning to keep questioning to standard 5 minutes, however 
I don't want to curtail productive dialogue.
    I believe we can do this and still ensure each member has 
the opportunity to get his or her questions asked. If we get 
bogged down, the chair will ask members to hold further 
discussion until the first round of questioning is complete. I 
ask unanimous consent that for the purposes of this hearing we 
dispense with the 5-minute rule and proceed as described, and 
without objection we will do so.
    At this point in time, we would like to move to our opening 
statements. General Mason, normally move from left to right, 
but since this is a bipartisan subcommittee we can go from 
right to left. And I will leave it up to whichever one of you 
guys want to go first, and you can decide among yourselves. And 
then we look forward to hearing from you.
    General Mason. I will go.
    Mr. Forbes. Okay.

STATEMENT OF LTG RAYMOND V. MASON, USA, DEPUTY CHIEF OF STAFF, 
                   LOGISTICS, G-4, U.S. ARMY

    General Mason. Well, good afternoon, Chairman Forbes and 
Ranking Member Bordallo, other members of the committee. I will 
follow your guidance, sir, and rather than read my written 
statement I will ask it to be submitted and accepted into the 
record.
    I would like to highlight three key points. First and 
foremost, we have accomplished much in the past 8, 10 years on 
reset. We have met our Iraq drawdown goals and we have surged 
to meet the reset requirements, thanks to your unwavering 
support and the support of our citizens. And we have infused 
significant readiness into our fleets, particularly our track 
fleet and our wheeled vehicle fleet.
    Second point is, much to be done yet. Reset is certainly 
the true cost of war. It is not about when the last unit gets 
back, it is when the last piece of equipment gets back and we 
get it into the depot and get it repaired. And as Ms. Bordallo 
said, Afghanistan is a different challenge from Iraq and 
perhaps we will discuss that in more detail.
    It is a tough challenge, it is a landlocked country, the 
enemy is significant there. So we are working our way through 
the retrograde operations out of Afghanistan. And we will need 
funding for 2 years once all the equipment gets back, and I 
would ask for your support of that certainly.
    Thirdly, the organic industrial base. We are committed to 
having a viable organic industrial base. We are proud of the 
work that our depots and arsenals have completed in the last 8, 
10 years. They have been very, very busy. The workload will 
certainly decline as our operations now have drawdown in Iraq 
and will draw down in Afghanistan in 2014 and beyond.
    But we are committed to keeping that core capability that 
provides us that warfighting capability to expand to future 
contingencies. And then finally, I would thank you for your 
awesome support of our soldiers, our 1.2 million Army soldiers 
and their families--Active, Reserve, and National Guard. And I 
what to thank you for your continued support of our reset 
operations, which is so critical to the readiness of America's 
Army.
    And I look forward to your questions. Thank you very much.
    [The prepared statement of General Mason can be found in 
the Appendix on page 25.]
    Mr. Forbes. Thank you, General.
    General Panter.

     STATEMENT OF LTGEN FRANK A. PANTER, JR., USMC, DEPUTY 
  COMMANDANT, INSTALLATIONS AND LOGISTICS HEADQUARTERS, U.S. 
                          MARINE CORPS

    General Panter. Thank you, Chairman Forbes, Ranking Member 
Bordallo and other committee members. Thank you for allowing me 
to appear today. And for the sake of time, I will keep my 
remarks very short because the questions are probably more 
important than my opening statement.
    As you may know, today we have over 27,000 marines deployed 
throughout the world, with 20,000 in Afghanistan. It is with 
your continued support to our marines and their families that 
our Corps has maintained our role as the Nation's expeditionary 
force in readiness. On behalf of our commandant, our marines 
and our family members, thank you sincerely.
    We were redeployed out of Iraq in the winter of 2009. We 
completed the last depot reset action at our depots in December 
of this last year. So that is an example of the time that is 
needed from redeployment to getting the equipment through the 
depots. We are now focused on the retrograde, as decisions are 
made of equipment coming out of Afghanistan.
    Our current OEF [Operation Enduring Freedom] ground 
equipment reset strategy, that was signed 1 January, 2012, is 
grounded on lessons learned from Iraq and the experiences we 
had there related to retrograde and reset. It is written from 
an enterprise approach to ensure that we send the equipment to 
the right place the first time as best as we can.
    Lastly, much like General Mason mentioned, as long as we 
have marines and soldiers in harm's way we need continued OCO 
[Overseas Contingency Operations] support. Related to the 
equipment piece, it is when the last piece leaves Afghanistan. 
And we will need 2 or 3 years to reset and fix our Marine Corps 
for the next contingency that might arise in defense of our 
Nation.
    Thank you, and I look forward to answering your questions.
    [The prepared statement of General Panter can be found in 
the Appendix on page 36.]
    Mr. Forbes. Thank you both. And as I mentioned at the 
outset, we appreciate the service you have both given to our 
country. And we want thank not only both of you for what you 
have done, but also as representatives of the men and women who 
serve under you for the great job that they do in defending 
this country and keeping us free.
    I am going to defer my questions until the end because I 
know our members have very busy schedules. I want to make sure 
they can get their questions in.
    So I am going to ask the ranking member now to ask any 
questions that she has, and I yield her as much time as she 
needs.
    Ms. Bordallo. Thank you, Mr. Chairman. And again, thank you 
to our witnesses.
    General Mason, can you further discuss for the committee 
how the Army is working to ensure that National Guard units 
back in the United States and the Territories will receive 
equipment that is coming back from Iraq and Afghanistan? And 
further, can you elaborate on how the dual line and specific 
homeland defense mission equipment requirements will be met for 
National Guard units?
    I am concerned that simply replacing equipment to fill the 
units' modified table of equipment may miss a broader strategic 
imperative in where we place returning equipment, and that it 
assumes significant risk for our National Guard. General.
    General Mason. Yes, ma'am. First off, I would say that the 
modernization and the fill of the equipment to the National 
Guard and the Reserve component has significantly improved in 
the past 8, 10 years. And because of the force deployments 
through army force generation, those forces where, in the past, 
may not have been cascaded equipment because they have deployed 
at ever-increasing rates, we have filled them with equipment.
    So that is key right off the bat. So they are in pretty 
good shape. Secondly, how do we make sure that they get that 
equipment. First off, we follow the Department of the Army 
master priority list that the G-3 [Army Plans and Operations] 
of the Army runs, gets the priorities from the secretary and 
the chief.
    And then we have a series of processes we run through, and 
one them is called retrograde, redistribution and reset, and it 
is R3. It is managed by the Army staff. I am a member of that 
team. And what we do is, we get all the requirements in from 
the different MACOMs [Major Army Commands]--Army, National 
Guard, USAR [United States Army Reserve]--rack and stack those, 
based on the requirements.
    And then we cascade equipment to those units. It is based 
on ARFORGEN [Army Force Generation]. The next deploying unit is 
certainly going to get the latest equipment and get its entire 
fill. And we have aim points inside of the ARFORGEN that says 
you will get this readiness rate at return plus 90 days, return 
plus 180 days. And that is regardless of whether you are an 
Active unit, National Guard or Reserve unit.
    So they are all treated the same, and I would say that they 
are in very good shape, ma'am.
    Ms. Bordallo. Well, thank you. Thank you, General.
    This question, the next one, is for either of our 
witnesses. I hope you can expand on the issues surrounding the 
northern distribution network. We know that it costs 2.8 times 
more to transport equipment through the northern distribution 
network. But the Pakistan ground route is closed so we are 
limited to options.
    Now, what risk in the proposed fiscal year 2013 budget, and 
in the outyears, are we assuming by including these 
transportation costs in the OCO account? Whichever one.
    General Panter. Let me start, and then you can pile on, 
Ray.
    Well, it is a concern of us, and it is a great concern. If 
we can't negotiate a successful--negotiate the reopening of the 
PAK GLOC [Pakistani Ground Lines of Communication], we have to 
default, and rely on the NDN, northern distribution network or 
increased strat [strategic] airlift. Both are expensive 
propositions, and it increases the deployment, or redeployment.
    There is always that sensitive issue about the nations. We 
are dealing with the NDN [Northern Distribution Network] 
network, in itself. If, for some reason, that there is 
additional political strain related to these countries, that 
restricts the flow as well. Redeployment timelines, by not 
being able to use the PAK GLOC, will increase. Along with, as 
you mentioned, ma'am, the cost, as well.
    Despite all these challenges, though, TRANSCOM [U.S. 
Transportation Command] and CENTCOM [U.S. Central Command], 
they do have mitigation strategies in place. And I would be 
more than happy to talk about those, as well. There are quite a 
few of them, but negotiations are ongoing, as you know, to 
reopen the PAK GLOC.
    Ray, you want to pile on?
    Ms. Bordallo. General.
    General Mason. Yes, ma'am. The PAK GLOC is critical, and it 
has been closed since November. The good news is, because of a 
lot of really great planning our logistic situation is in very 
good shape. Fuel, we watch very closely.
    But back to the issue of retrograde out of Afghanistan. We 
are getting it out by air. So as aircraft come in--and we fill 
aircraft as they depart, both Air Force aircraft as well as 
commercial aircraft--we are using every available aircraft to 
go back out again.
    The northern distribution network, it is three to four 
times more expensive because it is three to four times 
lengthier. It is very complicated, a variety of different 
methods--rail, ferries, truck. So a significant amount of 
changing, and loading and unloading. So that adds to the cost, 
as well.
    We are in the process right now, with our partners at 
Transportation Command, to run a series of proof of principles 
to do backhaul. Right now, everything that comes in through the 
northern distribution network by ground comes one way. And the 
trucks go back empty because of the diplomatic clearances and 
we haven't really established that line.
    So we are in the process of doing that. We have got several 
hundred vehicles and containers that are moving back on the 
northern distribution network working through the diplomatic 
clearances. The State Department is significantly helping us. 
The CENTCOM commander, TRANSCOM commander, have visited those 
countries.
    So that is looking very good. Once we get that done, I 
think we will begin to get the exflow back out of the northern 
distribution network. But that is going to rise the cost. So 
the PAK GLOC is still critical. We need to continue to 
negotiate and try to get that back open, as well. We need both 
methods to get out of Afghanistan.
    Ms. Bordallo. So you are on top of it then.
    General Mason. Yes, ma'am. The team is.
    Ms. Bordallo. I have one final question, Mr. Chairman.
    This question, again, is for either of our witnesses. The 
fiscal year 2013 president's budget calls for a reduction in 
the end strength of the Marine Corps and Army, as well as a 
force structure change in many of our services. What criteria 
are being used to determine what equipment presently used in 
Afghanistan will be needed for future forces?
    And further, how does our pivot to the Asia Pacific region 
impact that assessment? I hope our witnesses can be specific 
about what types of equipment would be needed in the Asia 
Pacific as well as for the future forces broadly. So either one 
of you.
    General Panter. Ma'am, I will start because, as you may 
well know, we completed our force structure review 18 months 
ago. It was a detailed and conscious look at what the Marine 
Corps would look like at post-OEF. We took it to 186,200; from 
202,000 down to 186,200. And then further budget pressure 
caused us to take it a little bit further, to 182,100.
    We thought, we have confidence, that we have rightsized our 
Marine Corps at 182,000. We can still meet the national 
missions assigned to us. Related to reset, this 182,000 force--
knowing what that is--has helped to inform what we are 
resetting to. Now, you also may know that we swung a lot of 
equipment when we got out of Iraq over to Afghanistan.
    In fact, 42 percent of the equipment set we brought over 
from Iraq into Afghanistan, that stuff has essentially been in 
the fight for 10 years. We know what we are going to map that 
equipment back to. We are going to divest some of this 
equipment because it is worn out or is combat losses, or is 
planned for military sales--about 21 percent of that equipment 
set.
    So even though we are going down to 182,000, and we are 
divesting of some equipment, we know where we need to plug the 
gaps and holes to get the readiness of the force, across the 
board, back up.
    General Mason. Yes, ma'am. Very similar to the Marine 
Corps, we are in the process of doing our force structure 
alignment. Decisions have not been made yet by the secretary 
and the chief. We are looking at restructuring out brigade 
combat teams to potentially a third maneuver battalion. We now 
have two maneuver battalions in each brigade.
    We are also looking at adding another engineer battalion. 
So that is going to drive the equipment we want to take out. 
But we are not waiting on that. We will need all those types of 
equipment that are there. The question is the quantities of 
them. We know we are going to need MRAPs [Mine Resistant Ambush 
Protected vehicles], we know were going to need Humvees, we are 
going to need tactical vehicles. Certainly all the helicopters 
that are there. So it is really focusing in on the quantities.
    The way we are managing that is, we have a responsible 
retrograde task force, headed up by a three-star. And he is our 
connection to the theater. We send him the demand signal as to 
how we need out and when we need it. And we communicate that 
into the units. And so that is the priority we want to come 
back to the depots to get reset.
    In terms of your question in the Pacific, I think any 
battlefield we are going to go on we are going to have an IED 
[Improvised Explosive Device] threat. So MRAPs are going to be 
as critical in that part of the world as they have been in the 
last 10 years, last 8 years, in Iraq and Afghanistan.
    So one of the things we are doing is looking at our Army 
prepositioned sets. The chief and the secretary have directed 
us to do a full worldwide review of all that, with the focus on 
the new national military strategy about do we have the right 
amount in the Pacific. So potentiality for additional 
prepositioned sets in the Pacific, potentially training sets, 
our float brigade, which is called an Army Prepositioned Number 
3, we have a light brigade and a sustainment brigade afloat. We 
may need to relook that for additional capability. So the 
equipment we take out of Iraq and Afghanistan, some of that 
will be placed against APS [Army Pre-positioned Stocks], and 
will allow units then to rotate into the Pacific for training 
events or a contingency.
    The last thing is similar to General Panter; the divesture. 
Those old systems that we no longer need, we are going to 
divest of those. And that will save us and OPTEMPO [Operations 
Tempo] and O&M [Operations and Maintenance] dollars in the 
outyears. And so only have the equipment we absolutely need. We 
don't need to have a bunch of equipment parked in motor pools 
beyond our requirements.
    So we have a divesture process we are going through, as 
well.
    Ms. Bordallo. Thank you very much. Thank you, generals.
    And I yield back.
    Mr. Forbes. Thank you, Madeleine.
    The gentleman from New Jersey, Mr. Runyan, is recognized 
for 5 minutes.
    Mr. Runyan. Thank you, Chairman. And gentlemen, thank you 
for being here, and your service.
    Going back to when Ms. Bordallo was saying a little bit 
about, obviously, the northern route we are having to take out 
is obviously more expensive. To what degree does escalating 
fuel prices affect those estimates to actually go through that 
route?
    General Mason.
    General Mason. Yes, sir. Fuel prices are a driver for 
transportation command and air mobility command. I don't have 
the exact dollar figures at my hand, but I can get those. The 
fuel price is so dynamic up and down, and so TRANSCOM has to 
pay those fuel prices, as you know.
    The Defense Logistics Agency provides those. Normally, the 
Defense Logistics Agency sets the price of fuel at the 
beginning of the year, and that stays for that entire year. But 
because fuel has been so dynamic, they have been given leeway 
by OSD [Office of the Secretary of Defense] to adjust those 
during the year.
    I think they have done at least one adjustment. By fixing 
it at the beginning of the year, it allows the services to 
budget for that. I, and the G-4 [Army Logistics], pay for what 
is called ``second destination transportation charges.'' That 
is where a lot of the retrograde dollars for transportation are 
paid through.
    So I watch it very closely. SDT, second destination 
transportation, is increasing. And if we don't get the PAK GLOC 
open it is going to is going to exponentially increase.
    Mr. Runyan. And that being said, not having that open, are 
there decisions that are made to maybe leave equipment behind 
that you wouldn't because it is just more cost-effective just 
to leave it there and not pay the extra money to go out the 
other way?
    General Mason. Absolutely, sir. We, in fact, did that 
significantly in Iraq to the tune of about a billion dollars 
that we, through a number of mechanisms; either through excess 
defense articles, or foreign excess personal property, that we 
gave to the Iraqi army and police to get them up and running.
    We are not going to have the same opportunity in 
Afghanistan, we don't think, to be able to transfer large 
quantities of equipment to the Afghan police and military. They 
just don't have the infrastructure to accept that. So the vast 
majority we are going to have to pull out. There is a certain 
amount of equipment we will be able to either sell or donate to 
the Afghans.
    And some that is very old equipment will be divested 
through the Defense Reutilization and Marketing Service that 
DLA [Defense Logistics Agency] manages. They have got sites all 
over Afghanistan. Some of it they could sell locally, some of 
it would be cut up for scrap that is battle-damaged. And then 
they will also ship some out.
    But I think the vast majority of what is in Afghanistan, 
because of the conditions there, we probably are going to have 
to move out of that country. Now, we could move into the local, 
you know, countries that border it. And we are significantly 
looking at that, and there are opportunities there.
    Mr. Runyan. So you are saying there is not a significant 
chunk that you would consider leaving behind if you couldn't 
get it out through the south?
    General Mason. I don't think so, at this point; not a 
considerable amount. There will be some amount, but we think 
there are about 50,000 vehicles in Afghanistan. The vast 
majority of those will probably have to be retrograded, sir.
    Mr. Runyan. Thank you very much.
    General Panter. Sir, if I may pile on that question a 
little bit. Our triage efforts in Afghanistan, which we are 
doing better this time from the lessons learned from Iraq, we 
are trying to send it to the right place the first time to 
avoid some of this secondary transportation cost that General 
Mason talks about.
    Relating to our fuel cost factored into the decision to 
leave a piece of equipment or to move it, it is considered. It 
is most definitely considered. But I have to be straight up 
with you. If it is a hard requirement, and there is not a 
production line and that piece of equipment is needed, we will 
probably come to the decision that we will send it where it is 
needed to enhance the readiness wherever that piece of 
equipment needs to go.
    Thank you.
    Mr. Runyan. Thank you.
    Chairman, I yield back.
    Mr. Forbes. I thank the gentleman.
    The gentleman from New York is recognized for 5 minutes.
    Mr. Gibson. Well, thanks, Mr. Chairman. And great to be 
with the distinguished panelists today, too.
    Help me get caught up. There are three areas where I need 
the latest on where we are at. The first has to do with, as was 
mentioned earlier in the testimony, the new equipment we have. 
MRAP, for example. And then also there have been some 
transformation changes with regard to tables of organization.
    So how is that impacting now in the reset, when you look at 
the installation? So motor pool sizes, barracks and all that? 
And certainly, you know, that can be a significant cost, making 
that change in footprint back here in the United States.
    General Panter. I will start off.
    General Mason. Okay.
    General Panter. And you pile on. Sir, you are absolutely 
right. After 10 years of combat, we have learned that some of 
our TEs [Theater Equipment], the legacy TEs, are not what we 
need now, or for the future. A good example, com 
[communications] equipment--the requirement for com equipment 
and ground tactical vehicles--has increased.
    This is the nature of warfare now, distributed operations 
where you have smaller units going out. They need that C2 
[Command and Control] capability. In fact, sir, you might not 
recognize a company command post today if you walk into it from 
your time. Tremendous enhancements. We have to adjust, and it 
is a ongoing process of adjusting our TE.
    You are absolutely right. There is an impact at the 
installations on the back end of this stuff, and we are 
attempting to factor that in as we consider our MILCON 
[military construction] projects
    General Mason. Sir, as you know, we have modularized every 
unit in the Army. We finished that over the last, basically, 8 
years. Kind of started that in 2001 and 2002. And one of the 
centerpieces of that was the brigade combat team. We made it 
100 percent mobile, we made it 3 days' of supply. And that 
drove the truck requirement.
    So TRADOC, Training and Doctrine Command, is looking at 
what should the brigade of the future look like. Should we 
adjust it some? Does it really need to have 100 percent mobile? 
Could it be 80 percent mobile? Could it carry two days' supply 
and be sufficient?
    We are finding that in combat that is maybe more what we 
want. So TRADOC is working that through, they are modeling it. 
That will drive the amount of trucks. So we are on iteration 
three of our Tactical Wheeled Vehicle Study. We have got about 
260,000 vehicles, tactical vehicles.
    That is probably not what we are going to need in the 
outyears. So that is part of that divesture piece. So that will 
drive down the amount of vehicles that we take in the motor 
pool. That is one key piece there. At the installations, one of 
the things we are doing to optimize that is, the directors of 
logistics that do the maintenance on our installations are 
currently OPCON [operational control], under the Operational 
Control of Army Materiel Command.
    They were under Installation Management Command. And in 1 
October they will be fully underneath AMC [Army Materiel 
Command]. So AMC will be able to workload the entire capability 
across the Army, the industrial and the sustainment maintenance 
from one location, and be able to see all that. And then drive 
it towards effectiveness and efficiency.
    So that is moving out in a really good pace.
    Mr. Gibson. And so among the things being considered, I had 
heard--and I don't know this to be confirmed, but that there is 
consideration--of changing the BCT [Brigade Combat Team], 
possibly another infantry battalion. And then, of course, that 
will have impacts on barracks and other things. Certainly 
things we are going to have to watch in terms of cost.
    General Mason. Absolutely, sir. And we are working that 
very deliberately. The chief is looking at those standing up, 
over time. You know, we have discussed taking down eight 
brigade combat teams, but that is probably going to be the 
headquarters. Of course, the two brigades in Germany have 
already been announced. The other four brigades will be 
announced, I think, over the following years.
    So we are looking through, you know, that third battalion. 
The leadership is convinced that is what we need for the 
warfighting capability; that is what the last 8 years have 
convinced us of, and certainly the engineers. So we are working 
our way through the MILCON.
    We clearly recognize that MILCON dollars are short, and so 
we are trying to do what we can on our installations. Our 
installations are in great shape, and it is a matter of 
shuffling around and working our way through there. So the team 
is working the numbers and the physics and geography of what we 
can do in our installations.
    And where do we put those brigades, and that third 
battalion.
    Mr. Gibson. Okay, very well. That certainly helps, and I 
appreciate the update.
    I will throw these others out. I am not sure I am going to 
have time for it, but you talked about OCO. And, you know, over 
the past decade we had the REF [Rapid Equipping Force] and the 
RFI [Rapid Fielding Initiative] programs. I would be interested 
to know how that bodes for the future.
    And then also just a very simple question. We had 
assumptions on half-life of equipment, OPTEMPO hours before we 
would replace. Have we adjusted those assumptions? Because 
certainly, that is going to have impact not only on current 
readiness, but also on procurement in the future. Has that 
changed, based on the war?
    General Mason. Both the rapid equipping force and rapid 
fueling initiatives have been great successes, both from the 
individual soldier and from the unit standpoint. So the Army is 
going through a process of whether you are going to keep REF as 
a rapid acquisition process.
    My opinion is, it is a capability we probably need to keep 
in the force and be able to rapidly get it through there. Back 
to the assumptions on the health of the equipment coming out of 
theater. Because we put significant special repair activities 
in-theater that has infused health into our vehicles and our 
equipment coming back.
    So some of this equipment is actually in better shape than 
we thought it was going to be. Some of it is worse. But 
generally, it is in pretty good shape because we put capability 
downrange, depot kinds of capability. It came out of TACOM 
[Tank-automotive and Armaments Command] and AMCOM [United 
States Army Aviation and Missile Command] and MICOM [United 
States Army Missile Command].
    On the base, fix as far forward as possible. And that has 
really made a big difference.
    General Panter. If I could answer this from a joint 
perspective, we have learned to maximize the use of joint 
capability better than we have in the past. The fix forward 
concept, we rely on Army Materiel Command with the maintenance 
and repair of our equipment in Afghanistan with the hope that 
we can vector some of that stuff back to home stations to avoid 
some of these extra transportation costs going through the 
depot.
    But what has changed and shifted, which I think is the 
basis of your question, is the reliance on DLA. Things like 
AMC, things like maximize the use of that as a joint force. 
Thank you.
    Mr. Forbes. I thank the gentleman.
    Generals, thank you so much for your testimony. And now I 
have just got a few wrap-up questions if could offer them to 
you and ask your response on. The first thing, and you have 
touched on this a little bit. But can you bring into focus for 
us the experience that you have learned from your experience in 
Iraq, the lessons you have learned that have informed our 
retrograde operations in Afghanistan?
    General Mason. Sir, I reference what the lessons we learned 
from Iraq to transpose over to Afghanistan. Command and 
control, number one. You have got to have the right 
infrastructure with the right leaders. And I mentioned earlier 
about the responsible retrograde task force. General Dunwoody, 
the AMC commander, sent her deputy three-star into Kuwait to 
oversee that operation.
    And that provided the right level of leader and staff to 
synchronize that, in coordination with Army Central Command. I 
also mentioned the retrograde reset and redistribution lists we 
use that determines where this equipment is going to go. So we 
provide those to theater so they can see what the requirement 
is.
    And then AMC can see, at the depot, where it is coming. We 
put teams as far forward in the battle space as possible to 
help those units. Because while retrograding, and we want them 
to focus on that, their main job is to conduct combat 
operations. So we are helping them with that.
    And it was recently approved to put the CENTCOM materiel 
retrograde element--a force of about 2,000 people--into 
theater, and they will focus purely every day on retrograde. 
The fourth thing I would say is that we need to provide, and 
are providing to the theater, good distribution instructions.
    As General Panter mentioned, telling them exactly where it 
needs to be shipped to so you can get the velocity in the 
system and use your transportation very effectively. So there 
is a series of lessons learned. I would say it is mainly 
command and control really turns the day.
    General Panter. Sir, if I could add that we view this is 
commander's business about accountability of equipment. And I 
think it is fair to say the United States Army sees it the same 
way. Something else we have done, we are more aggressive in 
assessing the condition of our equipment that we are about to 
return in Afghanistan than we did in Iraq.
    We shipped a lot of stuff from Iraq that probably was not 
worth shipping, that we had been better off to divest it. We 
don't want to make those mistakes again. Decisions are being 
made from an enterprise perspective, based on the commandant's 
priority where to send this equipment.
    If it is to the III Marine Expeditionary Force in Okinawa, 
or it is to Camp Pendleton in California, those decisions are 
being made early on, based on the need, based on the readiness 
condition of those units. We have data assist teams that are 
going forward and have been going forward to help cleanse the 
data so we have accurate records of what we have on hand, so we 
have a full visual of what is facing us to be sent home.
    Some of this is tactical. We told the commanders. We put a 
10 percent tax on some of the forward operating bases. Roll 10 
percent back, but don't put yourself at risk. But we know there 
is some excess stuff out there to try and get this mountain of 
things down.
    Every time there is an opportunity for opportune lift 
related to strat [strategic] lift, we are trying to maximize 
that. We are triaging and putting equipment in marshalling 
areas so if we get a chance to put something on the plane we 
will be in a position and we don't have to delay or we miss an 
opportunity for that.
    Last, the reset strategy that the commandant signed off on, 
on 1 January, I think it links the tactical, the operational 
and strategic aspect of this thing. So the Marines know that 
there is a bigger picture here. There is a bigger operation 
going on here. That whether they are accessing a piece of 
equipment in theater or fixing it or whatever they are doing 
in-theater, there is an in-state to it.
    And the enterprise, from a larger perspective, we are 
attempting to get it where it is needed the most.
    Over?
    Mr. Forbes. Thank you.
    General Mason. Chairman, if I could offer a couple of 
amplifying points, and to jump on top of that. It is 
commander's business, and what General Scaparrotti and the 
commanders downrange are saying is, ``Commander, you own 
everything on your forward operating base. That is your home, 
and so these containers that may have been there when you got 
there, you gotta open them up, you gotta look inside of them.''
    So it is about leadership. Secondly, it is about 
rehearsals. We just finished a major rehearsal ``rock drill,'' 
we call it, in Qatar, with CENTCOM use of 4-alpha. I had a team 
there to talk through the processes of retrograde and getting 
the right equipment out there. So rehearsals.
    About every 6 months we have been doing those, and we may 
have to do those more often as we get closer to 2014. Thirdly, 
we have partnered with the both the Army Audit Agency and GAO 
[United States Government Accountability Office] to provide us 
a third set of eyes--another, you know, outside set of eyes--to 
watch us, see what we are doing, give us feedback.
    They are embedded in there with use of 4-alpha. We did that 
in Iraq. We found that very successful. The honest broker to 
say you have got some problems here, and maybe you don't see 
them, maybe you have got some blind spots. And then finally, 
internally to me, I do a weekly video teleconference with 
theater.
    Every Wednesday morning, just did one this morning. I sit 
with ARCENT [United States Army Central], and use of 4-alpha, 
United States Forces Afghanistan. We talk about where we are 
at, where are the gaps, where are the friction points, how can 
we help them, what help do they need from us. So those 
processes continue to be focused on that reset.
    Mr. Forbes. You know, we hear a lot about the term 
``reset,'' but how important is reset to the readiness of the 
force, from a strategic point of view? And how imperative is it 
that we make that investment, and do it?
    General Mason. Sir, it is key and central. We have rode our 
equipment hard. It requires reset. You, the Congress, have 
funded that over the last 10 years significantly, both in terms 
of maintenance but also in terms of procurement for the battle 
losses.
    And we took significant battle losses in helicopters, 
tanks, Humvees, MRAPs. So replacing that equipment is part of 
reset. And that has been magnificent. It has also provided us 
the opportunity to infuse technology. So when we bring 
something back to the depot, not only do we reset it in the 
sense of repairing what happened in theater, but at the latest 
technologies there.
    A new transmission, a new suspension system. And as you 
know, we have continued to put significant weight on our 
vehicles with armor. So being able to put the latest suspension 
system in, to infuse that readiness. And right now, the age of 
our fleets, the track fleet, is about three to 4 years old in 
terms of the amount of reset help we have put into it.
    The tactical wheeled vehicle fleet is very similar. And our 
readiness rates show it, both in-theater--we are consistently 
in the the upper 80s to 90 percent on readiness rates of our 
wheeled fleet, and--and the MRAPs. And in good shape in the 
helicopter fleet; 75 percent to 80 percent. Very good.
    Similar back here at home. So that reset is central to the 
readiness of our army now, and in the out-years.
    General Panter. Sir, if I may add some comments to that. If 
we don't get the reset--a subset of OCO, of this strategic 
reset that we talk about, 2 to 3 years beyond the end of the 
war--it is going to take us longer to reset our force. Instead 
of a bell curve that you would see, you will see a flat line.
    This will take us five, six, seven, 8 years to fix the 
readiness issues that we have in the Marine Corps. We might 
have to consider going to a tiered readiness because it will 
take us that long to have units that are capable and have the 
sufficient readiness rating that would be next in the batter's 
box to deploy.
    There will be other--it would manifest itself in things 
like maybe lack of training because we won't have the equipment 
that we would need for training. It would force us to make 
other hard choices related to the budget if we don't have that 
support there to reset our force.
    Mr. Forbes. When we look at the amount of dollars to do the 
reset, General, what are we talking about for the Army? General 
Mason?
    General Mason. Sir, if you are referring to the total 
amount----
    Mr. Forbes. Yes.
    General Mason [continuing]. At worst case--at worst case--
it could be up in the $15 billion to $16 billion range. I think 
it is going to be less than that. I don't know exactly where it 
is going to be, but I think it is significantly less than that. 
And the reason I say that is because, again, as we go through 
the force structure changes and we look at the requirements for 
units--and I talked about divesture earlier, for example 
wheeled vehicle fleets--we know we are going to take our 
vehicles down, we are going to take units out of the force 
structure.
    So we are not going to reset all that equipment. Number 
one, because there won't be a requirement for it. Number two, 
some of that equipment will be unrepairable. So it will be 
beyond repairable so we won't repair that particular equipment. 
It will all be based on our priorities.
    We are looking at it very closely. We are certainly going 
to reset the helicopter fleet. We need every one of those. We 
are going to reset our MRAPs. We are going to divest some 
MRAPs, but the vast majority of those MRAPs we will need. The 
tanks and Bradleys, we have already done those.
    It is the radios, it is all that other equipment that we 
are really going to have to focus on and work through the 
eaches of what that requirement is going to be. So much less 
than $15 billion, but not exactly sure where it is going to 
fall in, at this point.
    Mr. Forbes. Would it be fair to say that even though it 
would be less than $15 billion, it is probably going to be at 
least $12 billion, or more?
    General Mason. Sir, I hesitate to say. But I think it could 
be in the $10 billion to $12 billion, sir. We have got some 
work to do and really look through it. Looking at what the 
equipment looks like as it comes out of theater is going to 
drive that number in many ways.
    And while we can do some inspection in-theater, most of 
that equipment is out being used every day. So you really don't 
know 'til it gets back to the depot, 'til you get a full 
inspection on it, do you really get an idea of what it is going 
to cost to take care of that equipment.
    Mr. Forbes. We can't peg exactly how much, but can we get 
close on what years that we think probably the highest spike 
would be?
    General Mason. Sir, the mandate--to be generally done with 
combat operations by 2014--if you add 2 more years to that, as 
we discussed, I think the high point is going to be in the '15 
[2015], '16 [2016] timeframe.
    Mr. Forbes. Good.
    General Panter.
    General Panter. Sir, our requirement is $3.2 billion. We 
continuously refine that. The commandant has made it clear to 
us just ask for what we need. And that is part of that 
refinement, continuous refinement. But it is $3.2 billion. That 
is from that strategic reset post, the war being over.
    We think our spike--a little different--is going to be '14 
[2014] and '15 [2015].
    Mr. Forbes. Fourteen [2014] and '15 [2015]?
    General Panter. Yes, sir.
    Mr. Forbes. You know, General Mason, you mentioned the 
importance for our commanders in opening up those boxes that 
are there and finding out what is in them. One of the boxes all 
of us have been reluctant to open is this box of sequestration, 
you know.
    But we know it is the law right now and we know, based on 
the law, it is kind of across the board cuts. Assuming that 
stays the law, assuming it is not changed, what does that do to 
your reset?
    General Mason. Sir, it significantly impacts it. If we 
don't get OCO, and we have to take it out of the base, it is 
devastating, it is catastrophic. We will take significant risks 
with our swing forces. So we need to reset what is coming out 
of theater, so if we don't get those dollars through OCO we 
would have to go into the base. Which means the forces that we 
might have to use for another contingency somewhere in the 
world, their readiness rate is going to go down.
    I guess I would equate it to--you know, we are going to 
take 72,000 soldiers out of the Army, but we are going to take 
it over about a 5-year period. It is going to be very 
deliberate, we are going to work our way through it, we are 
going to do the right things for our soldiers as they exit our 
great Army.
    If you go to sequestration, I think you are talking about 
taking 80,000 soldiers out in 1 year. I mean, that is the kind 
of scenario that could play itself out. You are talking rifts 
like we did at the end of Vietnam. I mean, those are the kinds 
of things that I think could be on the horizon.
    I hope they are not. I don't want to go there. But I think 
it is as the Secretary of Defense has said, it would be 
catastrophic.
    Mr. Forbes. General Panter.
    General Panter. Yes, sir. I think it is so significant that 
we would have to relook at our national military strategy. We 
would probably have to reduce our force a further 15,000 to 
20,000 marines.
    Mr. Forbes. General Panter, where would that put you in 
terms of----
    General Panter. Well, that would--you back off 20,000 from 
182,000, that puts you in our 1970s profile, which was not 
healthy at all. In fact, it was a hollow force, sir, if you 
remember then. We couldn't train then. I would see a similar 
thing because we couldn't afford the fuel to train, we couldn't 
afford the Class V, the ammo, to train.
    Very similar things, I would think, might be manifested if 
we have to go to this. We would break faith with our marines. 
We have a plan now to get down to the size that we need to be. 
It is based on voluntary mechanisms. We would be forced, like 
the United States Army, to go to involuntary means.
    And we would consider that breaking faith with our marines 
and family. We would have to consider, as I mentioned before, 
tiered readiness, which we do not want to do. The inability to 
train, having sufficient equipment, having sufficient O&M, 
personnel shortages.
    It just would not position the Marine Corps to be the 
expeditionary force in readiness that the Nation expects. Thank 
you.
    General Mason. I would offer one other thing, Chairman. The 
chief's guidance to the Army is prevent, shape, and win. If you 
go to that kind of a scenario, his ability--the Army's 
ability--to prevent war, deter an enemy would be at risk. Our 
ability to shape with our allies and those potential enemies 
around the world, and then to win.
    Each one of those, then, is going to be, I think, at risk. 
And that is not a good situation.
    Mr. Forbes. Madeleine, do you have any other questions?
    Ms. Bordallo. I have no questions. [Off Mike.]
    Mr. Forbes. Okay.
    Does the gentleman from New Jersey have any additional 
questions? If not, gentlemen, we want to thank you so much, 
once again, for your service. Thank you, for this is an 
important record for us as we go into this markup that we need 
to do. We hope we are going to be able to hold those funds for 
you because we know how important it is for you to be ready.
    And we thank you for your time here today. And with that, 
we are--oh, let me just ask you. Do either of you have anything 
else you would like to add that we didn't ask or that you 
weren't able to have time to clarify?
    General Panter. No, sir. We appreciate the opportunity to 
answer your questions and to have this part of the record. 
Thank you.
    General Mason. Sir, the only thing to add is it is an honor 
to be here, and stand with our great congressional teammates. 
And I consider you teammates, and I can't think of any higher 
accolade to be a member of a team. So thanks. Good to be here, 
sir.
    Mr. Forbes. Thank you. And with that----
    General Mason. Ms. Bordallo, and----
    Mr. Forbes [continuing]. We are adjourned.
    [Whereupon, at 3:50 p.m., the subcommittee was adjourned.]



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                            A P P E N D I X

                             March 28, 2012

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              PREPARED STATEMENTS SUBMITTED FOR THE RECORD

                             March 28, 2012

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

      
                   Statement of Hon. J. Randy Forbes

               Chairman, House Subcommittee on Readiness

                               Hearing on

                      The Navy's Readiness Posture

                             March 22, 2012

    I want to welcome all of our members and our distinguished 
panel of experts to today's hearing focused on materiel reset. 
I want to thank our witnesses for being with us this afternoon. 
General Mason, I understand this is your first time testifying 
in your new capacity as the Deputy Chief of Staff of the Army 
for Logistics, welcome.
    I also understand, General Panter, that this is likely your 
last time to testify before this subcommittee before your 
retirement. We thank you for your service and wish you the best 
as you transition.
    I believe it is important that you are all here with us 
today. Resetting our force is a strategic imperative and one 
that will require a continued commitment from this subcommittee 
and this Congress beyond combat operations. In light of 
shrinking defense budgets, the Budget Control Act's looming 
sequestration, and the Administration's announcement of an 
accelerated drawdown in Afghanistan, I believe this hearing is 
very timely.
    Last year we spent a great deal of time exploring our 
current state of readiness and discussing how we remain 
prepared to meet the challenges we are likely to face in the 
future. Time and time again, we heard of a force that Gen. 
Breedlove described as being ``on the ragged edge.'' We learned 
that one of the major drivers behind this degraded force was a 
lack of materiel readiness.
    Today we again explore readiness, this time, in the context 
of reset and its importance to ensuring a capable future force. 
Complicating this effort is the reduction of $754 billion in 
the Department of Defense's 10-year budget, leading the DOD to 
cancel many of its most advanced systems like the CG(X) next-
generation cruiser program, the F-22, and the Army's Future 
Combat System.
    DOD has also made tough decisions on force structure and 
civilian personnel, shrinking the Marine Corps by more than 
25,000 marines, the Active Army by 72,000 soldiers. In short, 
this means that resetting the force is now more important than 
ever. The Administration is arguing that we can afford a 
smaller force, one with less capacity, so long as we have a 
more capable force.
    Let us be clear, failure to reset the force undermines this 
position and will leave us with a smaller and less-capable 
force. If we do not get this right, the implications will be 
far-reaching and long-lasting. Many tough decisions still lie 
ahead, and I remain concerned that because the Department has 
not begun planning for a possible sequestration, we only have a 
small sense of how truly catastrophic sequestration could be.
    We all have a responsibility to ensure our men and women in 
uniform are given the tools necessary for the job we have asked 
them to do. I look forward to learning more about reset and its 
importance to the warfighter.

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?

      
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              QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                             March 28, 2012

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                   QUESTIONS SUBMITTED BY MR. FORBES

    Mr. Forbes. 1) What are the consequences of not fully executing 
reset?
    General Mason. One consequence of not fully executing Reset is that 
a piece of equipment already used in theater may not be ready for use 
in the next contingency. Another consequence is that battle losses may 
not be replaced, thus impacting equipment on-hand readiness.
    Mr. Forbes. 2) How important is reset to keeping the organic 
industrial base viable?
    General Mason. Reset currently assists in meeting core requirements 
that are necessary to maintain critical skill sets of our artisans and 
our capabilities.
    Core requirements funded in our base programs sustain the long-term 
viability of our organic industrial base
    Mr. Forbes. 3) Are there items you believe are of a higher reset 
priority? Are there units that are higher priority for reset equipment?
    General Mason. Yes, there are some items like our major combat 
platforms and high demand critically short systems that have a higher 
priority for equipment reset than other items. And there are also units 
that have a higher priority for the reset of equipment based on 
projected deployment schedule.
    To address these priorities, the Army has established a very 
deliberate Retrograde, Reset, and Redistribution (R3) process for 
equipment, focused on transitioning from the needs of the current 
conflict to full spectrum operations and training. The R3 synchronizes 
retrograde, reset, and redistribution efforts across the Army to 
restore readiness. The process identifies retrograde priorities to 
assist Army Central (ARCENT) in retrograde planning, synchronizes 
retrograde of equipment out of theater with its repair, and subsequent 
redistribution to support training and equipment readiness (ARFORGEN) 
requirements. Equipment is returned to the Force in accordance with the 
priority established by the Deputy Chief Staff, G3 Dynamic Army 
Priority List.
    Mr. Forbes. 4) What is your reset strategy and plans for mine 
resistant ambush protected (MRAP) vehicles?
    General Mason. The Secretary of the Army has designated Red River 
Army Depot as the Center for Industrial and Technical Excellence for 
MRAPs. MRAPs will remain a critical fleet of multi-mission platforms in 
the Army that will require sustainment through the Reset program. The 
FY13 President's Budget requests almost $2 Billion ($927M OPA and $1B 
OMA) to fund sustainment of deployed MRAPs and upgrades to consolidate 
variant types, reduce MRAP fleet sustainment costs, and facilitate Type 
Classification and Full Materiel Release for MRAP enduring force 
vehicles. Primary upgrades include survivability through additional 
underbody armor; mobility with suspension upgrades; and safety 
improvements. MRAP Reset will return the platforms to 10/20 standard. 
Following Reset, the platforms will be issued to units, training sites, 
or placed into Army Pre-Positioned Stocks.
    Mr. Forbes. 5) How does Reserve Component equipment factor into 
reset?
    General Mason. The Reset process enhances equipment operational 
readiness and equipment levels regardless of component. All units, 
regardless of component, are equipped with the most capable equipment 
that the Army has to offer.
    Reserve component equipment is repaired or replaced as required. 
Equipment that requires depot-level repair due to its condition is 
repaired and redistributed according to Army priorities. The Army uses 
funds appropriated for Sub Activity Group 137 to support the Reset of 
equipment for all three components.
    Mr. Forbes. 6) How accurate do you believe your overall reset 
liability estimates are?
    General Mason. Army has recently reviewed the Reset Liability and 
remains confident that given the variables that our estimate remains 
accurate. If contingency operations ceased today, the Army estimates it 
would need $10-15B to complete Reset. There are many factors and 
assumptions that can affect the total future Reset Requests, such as 
battle losses/washout of equipment, the condition of equipment at the 
time of retrograde and the final determination on what equipment we 
will retrograde from theater. Army conducts an annual Reset Liability 
study in conjunction with The Office of Cost Assessment and Program 
Evaluation within the Office of the Secretary of Defense to revise and 
re-baseline our Reset estimates.
    Mr. Forbes. 7) How has the Army's lack of finalized plans regarding 
the composition and size of its force impacted your reset plans? How 
can you be sure your plans meet the needs of the Army in the future?
    General Mason. With the exception of some select equipment like 
Tactical Wheel Vehicles, radios, and small arms, we do not expect that 
pending force structure decisions will have a significant impact on 
Reset.
    Equipment not needed for future contingencies will not be Reset. 
Our Retrograde, Reset and Redistribution (R3) synchronization process 
closely integrates input from across the Army Staff and ensures 
finalized Reset plans meet the Army's current and future needs.
    Mr. Forbes. 8) How would proposed plans to add an additional 
maneuver battalion to certain brigade combat teams impact your reset 
plans?
    General Mason. In general, the proposal to add battalions should 
not impact Reset.
    Mr. Forbes. 9) The budget contains numerous ``efficiencies'' 
throughout the maintenance accounts. How confident are you that your 
Service will realize anticipated savings and what are the impacts to 
reset if you don't?
    General Mason. I am confident that the Army will continue to find 
efficiencies to improve our operations and reduce costs. Most of our 
efficiencies are against base programs; consequently if the savings are 
not realized, they will not significantly impact our Reset efforts 
which are funded by Overseas Contingency Operations (OCO).
    Mr. Forbes. 10) Last year the Army had to reprogram more than $2 
billion in reset funding due to executablity issues. How confident are 
you in the accuracy of this year's budget request and your ability to 
fully execute any provided funding?
    General Mason. Based on what we know today, the Army is confident 
in our FY 2013 budget request. We are also confident in our ability to 
execute available funding in FY 2012. Factors such as: the amount of 
equipment that needs to be replaced due to battle damage; retrograde 
lines of communication; operational decisions that affect equipment 
returning from theater on-time; and the condition of that returning 
equipment can affect our Reset execution.
    Mr. Forbes. 11) Can you discuss the potential need for OCO funding 
following the withdrawal of forces and equipment from Afghanistan?
    General Mason. Given the expected pace and challenges associated 
with the retrograde of equipment from Afghanistan and anticipated 
workloads for select equipment, we expect Reset will not be complete 
until 2-3 years after drawdown. This estimate takes into account the 
time it takes to return a piece of equipment back to the United States, 
and the time it takes to perform the required maintenance on an item.
    Mr. Forbes. 12) In light of Pakistan's extended closure of cargo 
transportation routes, what are your concerns about our continued heavy 
reliance on Pakistan for logistical support for operations in 
Afghanistan? How long will requested funding for transportation last if 
the Pakistani routes remain closed?
    General Mason. Closure of the Pakistan Ground Line of Communication 
(PAKGLOC), which is now in Day 123, has created challenges for 
sustainment, deployment, and redeployment operations into and out of 
Afghanistan. The loss of the PAKGLOC represents a reduction in 
throughput capacity for Afghanistan; however, due to the hard work of 
U.S. Transportation Command and U.S. Central Command, every commander 
and Soldier have what they need to complete their mission. We owe our 
ability to continue logistical support to initiatives implemented prior 
to and since the GLOC closure. This included increased use of the 
Northern Distribution Network (NDN), establishing new routes on the 
NDN, use of sealift in conjunction with airlift, and increasing supply 
levels. These efforts were effective but costly. Based on these 
initiatives, we are experiencing a significant increase in Second 
Destination Transportation (SDT) costs. Closure of the PAKGLOC 
illustrates why we cannot depend on a single or limited number of lines 
of communication to support our efforts.
    With the unexpected and continued PAKGLOC closure, Overseas 
Contingency Operations (OCO) funds for SDT are projected to run out by 
mid May 2012. The Army is exploring alternatives to reallocate 
resources to support this shortfall.
    Mr. Forbes. 13) In April of 2010, the GAO identified several 
challenges facing the Department with retrograde of equipment from Iraq 
to include: unclear guidance on what non-standard equipment will be 
transferred to the host nation; the inability to fully identify its 
need for contracted services; and visibility over its inventory of 
equipment and shipping containers. What steps have you taken to ensure 
similar challenges don't frustrate Afghanistan retrograde efforts?
    General Mason. Since the GAO published their report titled: 
OPERATION IRAQI FREEDOM: Actions Needed to Facilitate the Efficient 
Drawdown of U.S. Forces and Equipment from Iraq in April 2010, the Army 
has made significant improvements to our retrograde, contracting and 
asset visibility processes. Many of these improvements were 
acknowledged by the GAO in two subsequent audit reports published in 
August 2010 and July 2011. The Army continues to incorporate 
observations from the GAO and apply lessons learned from the drawdown 
in Iraq to refine plans and processes for retrograde efforts in 
Afghanistan.
    Specific guidance on the disposition of non-standard equipment (NS-
E) was provided in a Headquarters, Department of the Army (HQDA) 
published retrograde execution order. NS-E that is identified as excess 
and does not violate U.S. security codes, are eligible for transfer to 
the Government of the Islamic Republic of Afghanistan.
    A key lesson learned from the drawdown in Iraq that is being 
incorporated in Afghanistan is the establishment of a Fusion Cell. The 
Fusion Cell synchronizes, coordinates, and gains unity of effort across 
the operational, logistics, and contracting communities to support the 
drawdown timeline. The Fusion Cell also ensures that contracting 
support organizations and operational units coordinate to determine 
contract support requirements for new contracts, extensions, 
reductions, and contractor demobilization.
    To manage and maintain accountability and visibility of our 
equipment, the Army uses several automation systems and tools at 
various command levels. These systems and tools include the Property 
Book Unit Supply Enhanced (PBUSE), Logistics Modernization Program 
(LMP), Army War Reserve Deployment System (AWRDS), Standard Depot 
System (SDS), and the Logistics Information Warehouse (LIW). In 
addition, a new web-based data tool, Theater Provided Equipment (TPE) 
Planner, was developed based on a recommendation by the GAO, that 
improves disposition management and visibility of equipment and also 
provides automated equipment disposition instructions thus accelerating 
the overall disposition process. The Materiel Enterprise Non-Standard 
Equipment (MENS-E) database was also developed to link disposition 
instructions for non-standard equipment with TPE Planner thus providing 
visibility for non-standard equipment and rapid processing of 
disposition instructions. Additionally, commands in theater have 
implemented an extensive series of mandated property accountability 
inventories requiring Commanders at every level to physically account 
for all their property and ensure it was recorded in one of the Army's 
accountable property systems of record ensuring Army-wide visibility.
    To maintain visibility over containers, the Army uses the Army 
Container Asset Management System (ACAMS). ACAMS is a management system 
that accounts for Army-owned containers and provides visibility of a 
container throughout its life-cycle. In the Central Command (CENTCOM) 
area of operations, the Integrated Booking System-Container Management 
Module (IBS-CMM) is also used to account and provide container in-
transit visibility. IBS-CMM allows leaders to track and identify 
containers while in theater and in the Defense Transportation System. 
Recently, the U.S. Army Central Command (USARCENT) developed a Theater 
Common Operating Picture system to capture detailed visibility of 
containers, associated costs and billing actions, and disposition 
actions.
    Significant improvements in retrograde processes were made since 
the release of the April 2010 GAO report resulting in a successful Iraq 
drawdown. Additionally, these improvements have been incorporated into 
the drawdown efforts in Afghanistan. We recognize that challenges 
remain in the drawdown from Afghanistan, but we are confident that our 
detailed processes and plans, which are inherently flexible, along with 
incorporating GAO observations and lessons learned from the drawdown in 
Iraq, will allow us to remain successful in our Afghanistan retrograde 
efforts.
    Mr. Forbes. 14) With Army yet to finalize the composition of its 
future force, how confident are you that we are not bringing home 
unnecessary equipment or leaving enduring capabilities behind?
    General Mason. Although the composition of the future force has not 
yet been approved, many of the types of equipment that are presently in 
Afghanistan, such as Mine Resistant Ambush Protected, Up-Armored High 
Mobility Multipurpose Wheeled Vehicles, and helicopters will be needed 
by the future force. I am confident that we are not leaving potentially 
enduring capabilities behind in Afghanistan.
    The final approved force resulting from the Total Army Analysis has 
yet to be decided; however, the Army does know what capabilities will 
be required for that force. As equipment not needed for the final 
approved force becomes known, this equipment will be made available for 
transfer to the Afghan security forces and considered for filling Army 
Prepositioned Stocks requirements, especially for the Pacific region in 
keeping with the shift in strategic focus to that region.
    As future force decisions are finalized, we have the flexibility to 
amend our retrograde instructions to ensure the proper disposition of 
equipment.
    Mr. Forbes. 15) What steps are being taken while reset and OCO 
dollars are available to posture the depots for a post-reset 
environment?
    General Mason. We have taken a number of steps to ensure that the 
depots are postured to support Army base requirements in a post-war 
environment. First, we have identified and prioritized our core 
requirements to ensure we maintain the appropriate skill sets. Next, we 
are sizing our organic base facilities and workforce to meet and 
sustain our core competencies and workloads. Finally, we continue to 
pursue proven practices like Lean Six Sigma to ensure that our 
maintenance depots maintain their core competencies and capabilities to 
meet future requirements.
    The Army's reliance on OCO is declining as our base depot 
maintenance budget is restored.
    Mr. Forbes. 16) What have you done to make your depots more 
efficient?
    General Mason. The Army has recognized benefits from our total 
Continuous Process Improvement (CPI) efficiency efforts within our 
Organic Industrial Base. For example, the Army conducted CPI events to 
improve vehicle hull disassembly and disassembly process by creating a 
one piece flow at Anniston Army Depot. The Army has also used CPI to 
reduce rework as part of the UH-60 [utility helicopter] Main Rotor CAT 
III Blade Sheath Assembly Repair process at Corpus Christi Army Depot.
    Mr. Forbes. 17) There has been a fair amount of concern about the 
erosion of the overall U.S. military industrial base. What is your 
assessment of the industrial base? What are the implications for the 
depots and arsenals, and our ability to reset the force?
    General Mason. My assessment of our Organic Industrial Base is that 
it remains relevant, viable and responsive to the needs of the Army and 
the war fighter. Army readiness and sustainment is a direct result of 
the repair capabilities in theater as well as at our depots in support 
of Army and other Service equipment requirements.
    The implications are that we must maintain these capabilities in 
the future to support future contingencies. Our depots and arsenals 
have proven to be a great success story in our ability to reset force 
over the last decade. They provide a ready and controlled source of 
technical ability, expertise, and resources necessary to execute depot-
level maintenance effectively and efficiently without risks to our 
equipment readiness.
    The industrial base has been responsive to the current demands of 
operations in two theaters of operation and has accomplished the Reset 
of equipment returning from combat and sustained non-deployed forces. 
To accomplish this they have rapidly expanded production to levels not 
realized since the Vietnam War.
    For example, our organic maintenance depots more than doubled their 
production output since the start of the war, executing 26.8 million 
direct labor hours (DLHs) and repairing/overhauling over 93,000 end 
items; while arsenals have executed 1.9 million DLHs.
    Mr. Forbes. 18) What impact do high rates of carryover have on 
reset workload, if any?
    General Mason. For select programs, like Tactical Wheel Vehicles, 
high carryover rates slow the repair and return of equipment to units. 
However, for the majority of programs, high carryover rates do not 
impact reset workload. This has not impacted equipment resourcing as 
the Army addresses critical requirements through redistribution of 
available assets to ensure units have the equipment they require to 
begin training up in support of their next rotation.
    Carryover allows depots to maintain a consistent workload by 
inserting carryover workload into gaps provided by funding from one 
fiscal year to another and arrival of other workloads.
    The majority of carryover work being performed today is 
recapitalization programs. These programs are funded with procurement 
dollars, which have a three-year life and involve a complex mix of 
timing, receipt of dollars and equipment, customer schedules, and long 
lead materiel.
    The Army is aggressively attacking its carryover workload and 
working to drive carryover down. We expect to generate $1.2B of revenue 
in FY12 and FY13, adding shifts were feasible to address this workload.
    The high carryover rates have generally not impacted our reset 
program.
    Mr. Forbes. 19) What role do you see private-public partnerships 
playing in reset?
    General Mason. Public-private partnerships have provided a crucial 
role in reset. Depots have partnered with industry to accomplish the 
reset mission which allows for a balancing of workload with our 
commercial partners, complements our capabilities and provides 
flexibility in accomplishing the reset mission. Partnerships are able 
to adjust to changing requirements more rapidly as a result of the 
flexibility they provide in terms of capability and capacity between 
industry and government.
    Mr. Forbes. 20) How does reset play into your service's industrial 
base sustainment strategy?
    General Mason. Reset currently assists in meeting our core 
requirements that are necessary to maintain critical skill sets of our 
artisans and capabilities.
    Our ability to effectively respond to warfighter (Reset) 
requirements is built around the four primary tenants of our approach:
    Modernization requiring investment in new technology, training and 
plant equipment at the same rate that the Army modernizes its weapon 
systems.
    Capacity identifying and aligning core competencies and workloads 
to support current and future surge requirements while maintaining 
effectiveness and efficiencies at each facility.
    Capital Investment requiring the investment in our facilities to 
maintain `state-of-the-art' capabilities and quality of work 
environment (QWE) standards.
    Resource Alignment requiring the Army to prioritize funding to 
achieve the desired end-states: viable and relevant OIB facilities.
    Mr. Forbes. 21) When do you expect final approval of the Army's new 
Organic Industrial Base Strategy?
    General Mason. The Organic Industrial Base Strategy is complete and 
under final review by senior Army leadership. Release of the strategy 
will follow final approval by HQDA.

    Mr. Forbes. 22) What are the consequences of not fully executing 
reset?
    General Panter. The full reset of the Marine Corps' ground 
equipment is critical to protecting the long-term health of the force 
and meeting the next contingency. A decade of war in Iraq and 
Afghanistan has accelerated the degradation of our ground equipment 
well beyond the anticipated total life cycle estimates of most items. 
The Marine Corps estimates, based on usage rates, climate and other 
factors, that one-year of combat operations in theater equates to seven 
years of use at a home station. The full reset of the Marine Corps' 
ground equipment is necessary to baseline the force, extend the service 
life of each item, mitigate future readiness impacts and ensure Marines 
are equipped with the very best equipment.
    The delayed reset of ground equipment resulting from the transfer 
of the Operation Iraqi Freedom equipment and all of its Mine Resistant 
Ambush Protected vehicles directly to Afghanistan is a key element of 
the Marine Corps' Strategic Reset requirement. Failure to conduct a 
full Reset of the Marine Corps' Ground Equipment will cause:
    Reduced combat readiness due to premature aging of ground equipment 
fleet.
    Increased labor hours and expenses at our organic depots and 
operating force intermediate maintenance activities supported by 
limited baseline operational and maintenance dollars.
    Tiered readiness based on positioning the highest combat ready 
equipment with deployed or soon to be deployed units and continued low 
readiness for home station units.
    Reduced capacity to respond to unanticipated crisis.
    Mr. Forbes. 23) How important is reset to keeping the organic 
industrial base viable?
    General Panter. Marine Corps Depots at Barstow, California and 
Albany, Georgia are critical to the success of our reset execution. We 
view them as a ``force multiplier.'' Without the unique capabilities of 
the maintenance centers, equipment reset would be costly, less 
effective, and greatly prolonged. Reset reinforces the necessity to 
retain organic depot capabilities in order to expedite the repair of 
equipment and meet the needs of the Operating Forces.
    The organic maintenance facilities maintain flexible and rapidly 
adaptable production skills and capabilities to sustain Marine Corps 
ground equipment inventories to meet service-unique and surge workload 
requirements.
    Mr. Forbes. 24) Are there items you believe are of a higher reset 
priority? Are there units that are higher priority for reset equipment?
    General Panter. The answer to both questions is generally yes. In 
terms of items having a higher reset priority, Marine Corps Logistics 
Command (MCLC), as the activity responsible for Depot Maintenance 
actions, takes into account equipment demands in support of units in or 
going to Afghanistan as well as the inventory shortfalls in the 
operating forces at home station. These considerations influence 
maintenance scheduling, production and distribution. Generally 
speaking, ordnance items and wheeled vehicles have a high reset 
priority. Although all attempts are made by MCLC in the planning phase 
to meet war fighter needs, the availability of equipment to support 
Depot production lines can be a limiting factor. As we drawdown and 
retrograde equipment from Afghanistan, it will be important to vector 
equipment as quickly as possible to our depots for reset actions.
    The priority for equipping the force is guided and published by the 
Commandant of the Marine Corps in an annual message. In this guidance, 
it lists the units and activities in priority sequence for equipment 
distribution. At the top of the list are units in Afghanistan, followed 
by units preparing for deployment, and so forth down the list.
    Mr. Forbes. 25) What is your reset strategy and plans for mine 
resistant ambush protected (MRAP) vehicles?
    General Panter. The Mine Resistant Ambush Protected (MRAP) family 
of vehicles (FoV) is one of the Marine Corps most significant reset 
issues. Due to the significant capital investment required to fully 
reset MRAPs, the Marine Corps is currently conducting an in-depth 
assessment of the post-Afghanistan enduring MRAP requirement led by the 
Deputy Commandant for Combat Development and Integration. The Marine 
Corps' current MRAP FoV reset strategy is to conduct a full 
recapitalization of the Service's enduring requirement. As the final 
enduring requirement determination is made, the Marine Corps will re-
evaluate its strategic liability based on current inventory and adjust 
accordingly.
    Mr. Forbes. 26) How does Reserve Component equipment factor into 
reset?
    General Panter. The Marine Corps' Reserve Component is critical to 
the ongoing war effort and the future augmentation of our Active 
Component Marines. An Operational Reserve Component is critical to the 
Marine Corps total force and reconstitution strategy. Unfortunately, 
the equipment supporting our Reserve component has been significantly 
worn and degraded in line with the Active component.
    All equipping decisions are prioritized by the Commandant of the 
Marine Corps' Ground Equipping Priorities. The Commandant's equipping 
priorities is a fundamental tenet to guiding the execution of the 
Marine Corps OEF Ground Equipment Reset Strategy and the overall 
management of the Marine Corps' ground equipment inventory. As 
equipment completes reset at its optimal repair location, distribution 
will be determined by inventory shortfalls as informed by the 
Commandant's priorities.
    Mr. Forbes. 27) How accurate do you believe your overall reset 
liability estimates are?
    General Panter. We believe our overall reset liability estimates 
are accurate. The current forecasted ground equipment reset liability 
of $3.2B is based on the anticipated maintenance condition of each item 
in theater, the enduring Marine Corps requirement for each item and the 
item's forecasted optimal repair location. We continuously and 
diligently work to refine our reset cost.
    Mr. Forbes. 28) How have force structure reductions and composition 
changes impacted your reset plans?
    General Panter. No. The Marine Corps force structure plan to reduce 
the force from 202K to 182.1K will not have an impact on our reset 
plans. The Marine Corps has consistently reported in testimony the 
prevalence of Home Station equipment shortfalls. Despite the reduced 
force structure, equipment returning from Afghanistan is needed to 
reconstitute the 182.1K force. A central tenet of the Ground Equipment 
Reset Strategy is to ensure the reset of ground equipment is integrated 
with equipment modernization objectives, long-term support costs and 
strategic investment plans.
    Mr. Forbes. 29) The budget contains numerous ``efficiencies'' 
throughout the maintenance accounts. How confident are you that your 
service will realize anticipated savings and what are the impacts to 
reset if you don't?
    General Panter. Based upon the efficiencies gained by enacting 
continuous process improvements and the recent consolidation of our two 
organic maintenance centers under a single Marine Depot Maintenance 
Command, the Marine Corps is confident that anticipated savings will be 
realized.
    Assuming the availability of sufficient reset funding, the Marine 
Corps has developed an extensive reset strategy and maintains the 
flexibility to adjust capacity requirements to ensure there are no 
negative impacts to the maintenance process.
    Mr. Forbes. 30) Can you discuss the potential need for OCO funding 
following the withdrawal of forces and equipment from Afghanistan?
    General Panter. OCO funding will still be needed after the 
withdrawal of forces from Afghanistan since our baseline budgets cannot 
and were never intended to absorb the cost of equipment reset. Based on 
current planning estimates and our experience in Iraq, we anticipate 
the bulk of our reset execution at our Depots to take place 2-3 years 
after the last Marine leaves Afghanistan. Also, when considering the 
continued need for OCO funding, we must not overlook the unique 
challenges of moving equipment out of Afghanistan as delays will extend 
our reset actions in CONUS.
    Mr. Forbes. 31) In light of Pakistan's extended closure of cargo 
transportation routes, what are your concerns about our continued heavy 
reliance on Pakistan for logistical support for operations in 
Afghanistan? How long will requested funding for transportation last if 
the Pakistani routes remain closed?
    General Panter. At the present time, the closure of the PAK GLOC 
has not seriously impaired USMC force sustainment. However, we have 
experienced an increase in shipping time and costs while utilizing the 
Northern Distribution Network (NDN). In light of the current situation 
with the closure of the PAK GLOC and the increased reliance on the NDN 
and multi modal operations, it is in our best interest to continue 
efforts to reopen the PAK GLOC to guard against unforeseen 
interruptions to the NDN as well as facilitate redeployment and 
retrograde operations from Afghanistan. Right now with the closure of 
the PAK GLOC, we are looking at extended retrograde timelines and 
extension of our reset actions and supporting reconstitution 
objectives. On a positive note, with the significant drawdown of USMC 
forces in Afghanistan by the end of the year, the level of logistical 
support will significantly decrease for USMC forces and help relieve 
the pressure on the GLOCs.
    Based solely on both current and projected OPTEMPO, funding for 
transportation is adequate through the remainder of FY12. In order to 
provide additional transportation options USTRANSCOM has increased the 
availability of multi-modal shipments employing a combination of 
airlift, sealift, and ground transportation. At the present time, there 
is a marginal increase in overall transportation cost, but sustainable 
at our current funding level.
    Mr. Forbes. 32) In April of 2010, the GAO identified several 
challenges facing the Department with retrograde of equipment from Iraq 
to include: unclear guidance on what non-standard equipment will be 
transferred to the host nation; the inability to fully identify its 
need for contracted services; and visibility over its inventory of 
equipment and shipping containers. What steps have you taken to ensure 
similar challenges don't frustrate Afghanistan retrograde efforts?
    General Panter. The Commandant of the Marine Corps signed the 
Service's ground equipment reset strategy on 01 January 2012. The 
Strategy culminated from a comprehensive 18-month planning effort 
initiated at the March 2010 OIF Lesson's Learned Symposium to capture 
the salient lessons learned from the retrograde from Iraq as identified 
in the GAO report. As a result of that conference, the Marine Corps 
published its Guide to Expeditionary Stewardship, to ensure the lessons 
in in-transit visibility, contracted logistics support and equipment 
accountability were identified and integrated into the Service's 
Afghanistan Ground Equipment Reset Strategy.
    The Strategy utilizes a Ground Equipment Reset Playbook as the 
conduit between service-level guidance and tactical execution. The 
Playbook links reset to modernization and reconstitution objectives and 
provides a comprehensive tool that details the handling, segregation, 
packaging and shipment instructions for each of the 98,000 principle 
end item in Afghanistan to include non-standard items. The Playbook 
accurately reflects the service reset strategy for each principle end 
item in theater, aligns reset strategies with the Marine Corps' Depot 
Level Maintenance Plan, accurately forecasts the Marine Corps' reset 
liability, leverages all available assets in theater and requires an 
in-theater maintenance assessment by identifying each item's optimal 
repair location to mitigate secondary transportation costs. Marine 
Corps Logistics Command (MCLC), as the executive agent for tactical 
planning and execution, also published a tactical execution plan that 
effectively ties the Service Reset Strategy to the individual Marine in 
theater. MCLC provides the occupational expertise to direct reset 
actions from theater to home station and provides the Marine Corps with 
in-transit visibility of assets, reinforces the tenets of the Playbook 
and ensures total asset visibility and accountability in transit.
    Mr. Forbes. 33) What steps are being taken while reset and OCO 
dollars are available to posture the depots for a post-reset 
environment?
    General Panter. The Marine Corps recognizes that declining budgets 
will likely leave us with a relatively flat investment portfolio in the 
post-reset environment. Today, however, the Depots are currently 
operating at increased capacity. We want to leverage this capacity 
while we have it, continue to maximize the use of OCO funding, and fix 
as much equipment as we can. We realize that our capacity will be 
adjusted downward to a peace time posture as we complete retrograde and 
redeploy our forces from Afghanistan. This approach will prevent a 
surge in depot maintenance requirements beyond the current FYDP when we 
anticipate operating at reduced capacity. Based on current planning 
estimates, we anticipate the bulk of our reset execution to occur at 
our depots in the next two to three years.
    Mr. Forbes. 34) What have you done to make your depots more 
efficient?
    General Panter. The Marine Corps recently reorganized its two 
organic depots and created a single Marine Depot Maintenance Command. 
The single command will reduce overhead, reduce operating costs, and 
ensure the Commandant of the Marine Corps has an affordable capability 
and effective capacity to self-generate readiness and rapidly surge to 
meet wartime demands.
    The Marine Corps expects to reduce depot maintenance overhead costs 
by 9-13% across the Future Years Defense Program (FYDP). These savings 
represent 3-5% ($40M-$60M) of the Marine Corps' total organic depot 
operating costs across the FYDP.
    Mr. Forbes. 35) There has been a fair amount of concern about the 
erosion of the overall U.S. military industrial base. What is your 
assessment of the industrial base? What are the implications for the 
depots and arsenals, and our ability to reset the force?
    General Panter. From a USMC perspective, our organic depots at 
Albany GA and Barstow CA eliminate any concerns. However, we do rely on 
other service depots for select commodity repair and have seen no 
interruptions in support at this time. The depots are key to enabling 
the Marine Corps to fulfill its role as America's expeditionary force 
in readiness. The last ten years have provided a greater awareness of 
the impact our organic depots have on our ability to self-generate 
readiness, surge to meet wartime demand, flex to meet emerging threats, 
and quickly reconstitute the force post-conflict.
    The Marine Corps proactively monitors any initiatives that may 
negatively impact the organic industrial base, such as Title 10 
legislation changes and maintenance efficiencies. Assuming the 
availability of sufficient reset funding, we are confident that the 
organic industrial base will enable us to effectively reset the force.
    Mr. Forbes. 36) What impact do high rates of carryover have on 
reset workload, if any?
    General Panter. Due to the injection of reset workload, on top of 
previously planned workload, there will be higher levels of carryover. 
MCLC does not anticipate carryover to negatively impact Reset. Because 
of the injection of Reset in conjunction with pre-planned rotational 
workload, the Marine Corps will continue to experience high rates of 
carryover. However, these high rates have a positive impact, as it 
enables the organic facilities to maintain a high level of capacity 
across the production lines and fiscal years to support future reset.
    Carryover as a whole is a regular part of organic depot operations 
and is not, in and of itself, a negative or problematic issue. High 
carryover doesn't always equate to increased backlog. MCLC initiates 
various methods to increase capacity to work the backlogs, as 
necessary.
    Mr. Forbes. 37) What role do you see private-public partnerships 
playing in reset?
    General Panter. The Marine Corps' organic depots will play a 
central role in reset activities, restoring and repairing equipment for 
return to the Operating Forces. In keeping with standard business 
practices, we will also leverage other DoD depots, commercial vendors, 
and private-public partnerships when it is most cost-effective to do 
so.
    Mr. Forbes. 38) How does reset play into your Service's industrial 
base sustainment strategy?
    General Panter. Reset and sustainment are executed concurrently and 
are integrated in order to position the Marine Corps for long-term 
readiness. Acquisition Program Managers evaluate and develop customized 
sustainment strategies where there are combinations of depot and field-
level maintenance and replacement plans, which account for Marine 
Corps, other Service, and commercial sources of repair capabilities. 
Additionally, the Marine Corps has developed a Ground Equipment Reset 
Strategy that provides guidance to the various stakeholders to manage 
the overall reset effort. Thus, reset demonstrates the necessity to 
retain organic depot capabilities in order to meet the operational 
needs of the Marine Corps.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. ROGERS
    Mr. Rogers. 39) The Stryker program is one that has been identified 
as core for Anniston Army Depot. There are 10 variations of the 
Stryker. One of the pilots has been brought to ANAD. I note that in the 
detailed budget documentation for FY13, the Army lists a reduction in 
funding for 7 Stryker Pilot Programs. Is that because funding was 
provided in FY12 for those 7 programs so that we can expect to see 
inductions into the core mission at the organic depot at ANAD this year 
or was there some other explanation? Also, that accounts for 8 of the 
10 Stryker versions. Could you tell me what we should expect and the 
timeline for the other 2 versions. I ask because as you know the FY12 
NDAA required that the Army establish core for mission-essential 
systems in the organic depots within 4 years of IOC and I am told that 
all 10 versions of the Stryker are critical workload for ANAD.
    General Mason. Yes, the pilots were funded in FY12. National 
Maintenance Work Requirements (NMWRs) are scheduled to be completed in 
FY13 for the remaining two variants: Mobile Gun System and Nuclear, 
Biological, Chemical, Reconnaissance Vehicle. Pilot overhauls for these 
two systems are funded in FY13; however, due to the difficulty of 
obtaining low density and high demand components required to complete 
the NMWR development effort, the pilot overhauls may not be executed 
until FY14.
    Mr. Rogers. 40) The Army Sustainment Command has indicated that it 
would like to offer an overarching contracting vehicle that would 
include activities that go beyond those generally managed by the base 
Directors of Logistics. According to a briefing book that I saw, the 
EAGLE program would include RESET in the contract. Could you please 
explain what aspect of RESET you would include in the EAGLE program and 
how you will guarantee this Committee that you will not conduct depot-
level maintenance as part of these contracts or that you will not 
conduct maintenance that could be performed in the depots to meet their 
core requirements? I am concerned that EAGLE expressly exempts aircraft 
maintenance, but fails to similarly exempt ground combat vehicle 
maintenance.
    General Mason. Army Sustainment Command (ASC) and Army Contracting 
Command--Rock Island (ACC-RI) jointly manage the Enhanced Army Global 
Logistics Enterprise (EAGLE) program. EAGLE's primary focus is 
installation field level logistics. It is not the intent to use EAGLE 
as a depot level/sustainment contract. EAGLE will only be used for 
depot maintenance at the specific request of the LCMC and after the 
requirement is appropriately validated. Depots will have the 
opportunity to partner with EAGLE prime contractors to execute EAGLE 
requirements. EAGLE is primarily Directorate of Logistics (DOL) centric 
and as such, there are specific designators that separate DOL 
maintenance from depot level. The purpose of EAGLE is to standardize 
requirements documentation, reduce redundancy, improve small business 
opportunity, and improve competition for more efficient service 
contracting. The EAGLE program is both a business approach and 
contracting vehicle for competing and awarding service contracts for 
maintenance, supply, and transportation support. Its primary focus is 
field-level logistics/maintenance and not sustainment level logistics/
maintenance associated with depot level workload. ASC is the 
responsible organization for verification and validation of workload 
placed on the EAGLE contract vehicle. As a subordinate to Army Materiel 
Command (AMC), ASC follows AMC's enterprise RESET workload planning and 
decision guidance developed during semi-annual and annual conferences. 
There are checks and balances in place to ensure EAGLE is not used to 
perform depot level work unless that is the decision by the authorities 
responsible for depot workload at AMC. Providing the EAGLE acquisition 
planning, ASC coordinated with the Army Aviation and Missile Command 
(AMCOM) to remove any aviation maintenance capability from the EAGLE 
program. It is our understanding that AMCOM is currently working on a 
contract vehicle similar to EAGLE for aviation maintenance. EAGLE 
contracting actions require senior leadership approval to place any 
requirement on contract. By itself, EAGLE would not be in a position to 
contract out any depot maintenance requirements without AMC direction 
in the form of workload planning.
    Mr. Rogers. 41) As DOD works to implement the FY12 National Defense 
Authorization Act, it is my understanding that there will be guidance 
on the ability of the military services to seek waivers for weapons 
systems considered core or mission-essential under the provisions of 
Section 2464 of title 10. Does the Army plan to request any waivers for 
any systems or sub-systems? Also, could you give the Committee an 
example or a couple of examples of a weapon system that you consider a 
non-enduring element of the national defense and why you would consider 
something core or mission-essential, requiring depot-level maintenance, 
but not an enduring system. Can you help us understand that, please?
    General Mason. The Office of Secretary of Defense (OSD), in 
coordination with the Services and the HASC and SASC Professional Staff 
Members (PSMs), has developed implementing guidance for the FY12 NDAA 
changes that allows the Services to continue past best practices.
    The Army plans to submit a blanket waiver, in accordance with the 
OSD implementing guidance, for all weapon systems that are not 
considered an enduring element of the national defense strategy. Some 
examples are: (1) the Vehicle Optics Sensor System (VOSS), a network of 
daytime TV, night vision and thermal capability that is able to locate 
improvised explosive devices (IEDs), snipers and other threats at 
greater stand-off distances; and (2) the Camera Aided Monitor Station 
(CAMS), a low-cost mobile sensor suite tower that offers multiple 
detection and assessment capabilities. These capabilities are niche 
systems which are not enduring.
    Consequently, the Army will submit a waiver for these non-enduring 
systems.
    The Army would not consider a non-enduring element of the national 
defense a core or mission-essential item.
    Mr. Rogers. 42) I am very concerned about the drastic reduction 
that the Army is taking between FY12 and FY13 in depot maintenance 
funding for ground combat vehicles. Based on the President's Budget 
Request, it appears that the Army would fund ground combat vehicles at 
only about 52% of the FY13 level out of the base budget and there is no 
specific FY 13 OCO funding for depot maintenance. However, the Chief of 
Staff of the Army and the Secretary of the Army have both guaranteed 
this Committee and myself that the bulk of Army RESET money would be 
spent in our organic depots and arsenals. Can you please tell me how 
much of the money you are requesting for RESET you are planning to 
spend on depot maintenance? How much of that will be spent on ground 
combat vehicles? How much of that do you plan to spend in organic 
facilities?
    General Mason. For FY 13, the Army requested approximately $5.445 
billion for Reset. This request is comprised of $3.688 billion for 
Operations and Maintenance funding and $1.757 billion for Procurement 
funding. Within the Operations and Maintenance account approximately 
$2.7 billion is requested for Depot Level Maintenance. Of that $2.7 
billion roughly $161.9 million is requested for combat vehicles 
(Bradley & Other Tracked Vehicles) of which $59 million will be spent 
at organic facilities. Overall, $1.8 billion of the FY 2013 Reset 
request is planned for organic facilities.
    Mr. Rogers. 43) I note that the President's Budget Request for the 
Army failed to include any OCO funding for depot maintenance. Why did 
the Army choose to put all of the OCO associated funding for depot 
maintenance into the RESET account rather than in the depot maintenance 
account?
    General Mason. The uses two accounts to fund maintenance performed 
at depots. Land Forces Depot Maintenance (Sub Activity Group 123) is 
the base budget account for the depot-level maintenance of Army 
equipment. Reset (Sub Activity Group 137) is a true cost of war and 
requests Overseas Contingency Operations funds for war-related depot 
maintenance requirements.

                                  
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