[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]




 
                        [H.A.S.C. No. 113-95]

                                HEARING

                                   ON

                   NATIONAL DEFENSE AUTHORIZATION ACT

                          FOR FISCAL YEAR 2015

                                  AND

              OVERSIGHT OF PREVIOUSLY AUTHORIZED PROGRAMS

                               BEFORE THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

          SUBCOMMITTEE ON TACTICAL AIR AND LAND FORCES HEARING

                                   ON

                  FISCAL YEAR 2015 NAVY, MARINE CORPS,

                 AND AIR FORCE COMBAT AVIATION PROGRAMS

                               __________

                              HEARING HELD
                              
                             MARCH 26, 2014


                                     
[GRAPHIC] [TIFF OMITTED] 

                                     
 
                                   ______

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              SUBCOMMITTEE ON TACTICAL AIR AND LAND FORCES

                   MICHAEL R. TURNER, Ohio, Chairman

FRANK A. LoBIONDO, New Jersey        LORETTA SANCHEZ, California
JOHN FLEMING, Louisiana              MIKE McINTYRE, North Carolina
CHRISTOPHER P. GIBSON, New York      JIM COOPER, Tennessee
JON RUNYAN, New Jersey               JOHN GARAMENDI, California
PAUL COOK, California                RON BARBER, Arizona
JIM BRIDENSTINE, Oklahoma            DANIEL B. MAFFEI, New York
BRAD R. WENSTRUP, Ohio               JOAQUIN CASTRO, Texas
JACKIE WALORSKI, Indiana             TAMMY DUCKWORTH, Illinois
MAC THORNBERRY, Texas                WILLIAM L. ENYART, Illinois
WALTER B. JONES, North Carolina      PETE P. GALLEGO, Texas
ROB BISHOP, Utah                     MARC A. VEASEY, Texas
BRADLEY BYRNE, Alabama
                John Sullivan, Professional Staff Member
                  Doug Bush, Professional Staff Member
                          Julie Herbert, Clerk
                          
                          
                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2014

                                                                   Page

Hearing:

Wednesday, March 26, 2014, Fiscal Year 2015 Navy, Marine Corps, 
  and Air Force Combat Aviation Programs.........................     1

Appendix:

Wednesday, March 26, 2014........................................    29
                              ----------                              

                       WEDNESDAY, MARCH 26, 2014
  FISCAL YEAR 2015 NAVY, MARINE CORPS, AND AIR FORCE COMBAT AVIATION 
                                PROGRAMS
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

Sanchez, Hon. Loretta, a Representative from California, Ranking 
  Member, Subcommittee on Tactical Air and Land Forces...........     3
Turner, Hon. Michael R., a Representative from Ohio, Chairman, 
  Subcommittee on Tactical Air and Land Forces...................     1

                               WITNESSES

Bogdan, Lt Gen Christopher C., USAF, Program Executive Officer 
  for the F-35 Joint Program Office..............................     4
Grosklags, VADM Paul A., USN, Principal Military Deputy, 
  Assistant Secretary of the Navy, Research, Development and 
  Acquisition; accompanied by LtGen Robert E. Schmidle, Jr., 
  USMC, Deputy Commandant for Aviation, and RADM Michael C. 
  Manazir, USN, Director, Air Warfare, OPNAV N98.................    17
LaPlante, William A., Assistant Secretary of the Air Force for 
  Acquisition; accompanied by Lt Gen Burton M. Field, USAF, 
  Deputy Chief of Staff for Operations, Plans and Requirements, 
  U.S. Air Force.................................................    18
Sullivan, Michael J., Director of Acquisition and Sourcing, U.S. 
  Government Accountability Office...............................     5

                                APPENDIX

Prepared Statements:

    Bogdan, Lt Gen Christopher C.................................    33
    Grosklags, VADM Paul A., joint with LtGen Robert E. Schmidle, 
      Jr., and RADM Michael C. Manazir...........................    76
    LaPlante, William A., joint with Lt Gen Burton M. Field......   106
    Sullivan, Michael J..........................................    64

Documents Submitted for the Record:

    Response to Request for Information on Department of the 
      Navy's Aviation Procurement Programs.......................   135

Witness Responses to Questions Asked During the Hearing:

    [There were no Questions submitted during the hearing.]

Questions Submitted by Members Post Hearing:

    Jones, Walter B..............................................   167
    Smith, Adam..................................................   167
    Turner, Michael..............................................   157
    


  FISCAL YEAR 2015 NAVY, MARINE CORPS, AND AIR FORCE COMBAT AVIATION 
                                PROGRAMS

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
              Subcommittee on Tactical Air and Land Forces,
                         Washington, DC, Wednesday, March 26, 2014.
    The subcommittee met, pursuant to call, at 1:37 p.m., in 
room 2118, Rayburn House Office Building, Hon. Michael R. 
Turner (chairman of the subcommittee) presiding.

 OPENING STATEMENT OF HON. MICHAEL R. TURNER, A REPRESENTATIVE 
  FROM OHIO, CHAIRMAN, SUBCOMMITTEE ON TACTICAL AIR AND LAND 
                             FORCES

    Mr. Turner. Call to order the Subcommittee on Tactical Air 
and Land Forces.
    I want to apologize for being late. I was doing the 
important people's work of being on the House floor 
congratulating the University of Dayton, which is in my 
community, and which I am alumnus, on entering the Sweet 16, 
and wishing them well on their game tomorrow night.
    But, this committee meets here today to receive testimony 
on the Navy, Marine Corps, and Air Force budget requests for 
combat aircraft programs for fiscal year 2015.
    Our hearing today will consist of two panels. In the first 
panel, we will hear testimony on the F-35 program, and the 
second panel will consist of Navy, Marine Corps, and Air Force 
acquisition and requirements official, who will provide 
testimony on the services' combat aviation programs.
    On the first panel, we welcome Lieutenant General 
Christopher Bogdan, F-35 Program Executive Officer, and Mr. 
Michael Sullivan, Director of Acquisition and Sourcing, 
Government Accountability Office [GAO].
    The second panel, our witnesses are: Vice Admiral Paul 
Grosklags, Principal Military Deputy to the Assistant Secretary 
of the Navy (Research, Development, and Acquisition); 
Lieutenant General Robert Schmidle, Deputy Commandant of the 
Marine Corps for Aviation; Rear Admiral Michael Manazir, 
Director of the Air Warfare Division for the U.S. Navy; Dr. 
William LaPlante, Assistant Secretary of the Air Force for 
Acquisition; and Lieutenant General Burton Field, Air Force 
Deputy Chief of Staff, Operations, Plans, and Requirements.
    I thank you all for your service and your testimonies 
today.
    We have a number of issues to cover today. But my opening 
remarks will focus on the F-35 and budget reductions in the 
Navy, Marine Corps, and Air Force budget requests.
    The F-35, a fifth-generation fighter, is required to 
achieve the effects necessary to win in an integrated anti-
access/area denial [A2/AD] environment. Over the last year, 
slow but steady progress was achieved in development, 
production, and operations. The F-35 did well in testing last 
year, but with about one-half of flight testing completed. Much 
testing remains to demonstrate and verify its performance.
    This year, as was the case last year, F-35 software 
development is still of particular concern. The GAO's primary 
concern is that software development may be taking longer than 
expected, resulting in a potential delay of initial operational 
capability for the three F-35 variants.
    The Subcommittee on Air and Land Forces also shares that 
concern. And for the fiscal year 2014 National Defense 
Authorization Act [NDAA], the subcommittee included a provision 
that would require an independent team to review the F-35 
software development program and provide recommendations for 
improvement. This provision was adopted by the House-Senate 
Conference Committee and included in the fiscal year 2014 
National Defense Authorization Act. We expect the Department of 
Defense to send us that report no later than June of this year.
    This is an area the subcommittee continues to watch to 
ensure that the final software block of the development phase 
is completed on schedule. While the capability of the F-35 is 
needed for the future, the Air Force, Navy, and Marine Corps 
cannot ignore the modernization and life extension upgrades for 
their legacy fleets of AV-8Bs, FA-18s, F-15s, and F-16s, and 
the sustainment of those fleets.
    As most of you know, I didn't support the Budget Control 
Act [BCA] of 2011. But now, unfortunately, the effects of this 
act and sequestration have become apparent in this budget 
request which will reduce both capacity and capability in our 
Strike Fighter forces, resulting in higher risk in achieving 
military objectives in the future.
    Last year, the fiscal year 2015 through 2019, the Navy 
anticipated procurement of 69 F-35Cs. This year, the Navy's 
budget plans for only 36, a 52 percent reduction. These F-35C 
procurement reductions have resulted in an increase in the 
Navy's Strike Fighter shortfall, from 18 last year to 35 this 
year, in the 2023 timeframe. With fewer F-35Cs, the Navy Strike 
Fighter fleet will be less capable.
    For the Air Force, budget reductions have required the Air 
Force to lower its F-35 procurement in fiscal years 2015 from 
30 to 26, a 13 percent reduction. Additionally, the Air Force 
proposes retirement of the entire A-10 fleet, and 51 F-15Cs in 
the Future Years Defense Program. While the Air Force did not 
report a Strike Fighter shortfall last year, this year the Air 
Force projects that it will have a shortfall of 175 Strike 
Fighter aircraft in fiscal year 2019, 9 percent below its 
required inventory of 1900 Strike Fighter aircraft.
    The Air Force has also proposed the termination of the F-
16's Combat Avionics Program Extension Suite, or CAPES. CAPES 
would equip the block 40, 42, 50, and 52 fleets with new radars 
and defense systems that increase survivability against 
emerging threats. Without CAPES, the Air Force F-16 fleet will 
be less capable.
    I look forward to the testimony today of our witnesses, and 
I hope that they will be able to expand on the risks associated 
with the capacity and capability reductions in our combat 
aviation forces.
    And, with that, I would like to recognize my good friend 
and colleague Loretta Sanchez.

   STATEMENT OF HON. LORETTA SANCHEZ, A REPRESENTATIVE FROM 
 CALIFORNIA, RANKING MEMBER, SUBCOMMITTEE ON TACTICAL AIR AND 
                          LAND FORCES

    Ms. Sanchez. Thank you, Mr. Chairman. Thank you, gentlemen, 
for being before us today.
    Today's hearing will focus on fiscal year 2015 Navy, Marine 
Corps, and Air Force requests for tactical aircraft 
development, modifications, and procurement. And like almost 
all the parts of the DOD [Department of Defense] budget, there 
are significant reductions and changes being proposed in this 
area because of the decline in the overall funding picture. 
However, it is important to remember that today the United 
States remains the only country that can deploy and maintain 
thousands of combat aircraft almost anywhere in the world.
    The U.S. Navy and the Marine Corps total tactical aircraft 
fleet alone, is larger than almost any other nation's entire 
air force. In addition, the United States also remains the 
world's leader in tactical aircraft technology, including 
stealth, unmanned aircraft, engine performance, electronic 
warfare, precision-guided weapons, et cetera, et cetera.
    So it seems that the critical question for today's hearing 
is how the 2015 budget proposal affects the United States 
current dominance in the area of air warfare. And I think that 
this--that is one of the subcommittee's most important roles, 
is trying to maintain our advantage with respect to that.
    Also want to note that complex aircraft programs take a 
long time to come to fruition, and so whatever we do today is 
going to impact what we look like in the future. And making the 
right investments of course may not pay off for a decade or 
more.
    For example, it was investment decisions by the DOD and 
Congress in the 1970s that allows us to have a highly effective 
F-16 and F-18 aircraft still in the Air Force and the Navy 
today. In the time, there were many critics of that aircraft. 
They were said to be too expensive, too complicated, 
unaffordable to maintain, and to be sure, in both cases, it 
took time to get the aircraft as capable as they are today.
    And I want to say that because eventually we fix the 
problems and, of course, these are some of our most important 
tactical fighters today. And I think it is important to see 
that as we look at this F-35 program, which is what this first 
panel is going to be about. Because the F-35 also has many 
critics, and this program is very complex. And we have earlier 
versions flying today that aren't as reliable as we would like 
them to be, don't meet all the capability goals that we need.
    But we need to figure out whether they are on the right 
trajectory to ensure that we have the right product for our men 
and women in the military, especially keeping in mind the 
history, for example, of the F-16 and the F-18.
    So we have to make decisions today on the F-35 that will 
impact the Air Force, the Navy, and the Marine Corps in the 
2020s and the 2030s and maybe beyond, and at the same time we 
have to ensure that taxpayer funds are used correctly. And so I 
am really looking forward to this presentation today and this 
give and take, because this is a highly complex program.
    And, of course, the second panel on today's hearing will 
focus on all the other tactical and intelligence aircraft 
programs beyond the F-35, and there are a lot of pressing 
issues there also. One of them is the fate of the A-10 
aircraft, for example. The Air Force is proposing to retire all 
283 A-10s over the next 5 years. But in most cases, they 
propose to replace them with F-16s or F-35s or other aircraft.
    And, you know, production line of the F-18 is--which is 
scheduled to close in 2016, some in Congress are proposing that 
we procure more EA-18G Growler electronic warfare aircraft. But 
it comes at a very high price, and the Navy may not need more 
of these aircraft if it ends up eliminating an aircraft carrier 
and an associated wing, for example.
    And, finally, this subcommittee has to consider the whole 
arena of unmanned aircraft, the ones we fly today and the ones 
we have for the future. You know, we had the Global Hawk on the 
cutting block recently and it was kept in, and now the reversal 
is taking place. Now we want to retire the U-2 in 2016 and keep 
the Global Hawk. So both aircrafts have different advantages to 
them. I look forward to hearing from the Air Force, why they 
have gone in this direction, for example.
    So, Mr. Chairman, I think this is going to be a very 
interesting hearing.
    Thank you.
    Mr. Runyan [presiding]. Thank the ranking member.
    And with that, I now recognize General Bogdan for his oral 
testimony.

   STATEMENT OF LT GEN CHRISTOPHER C. BOGDAN, USAF, PROGRAM 
      EXECUTIVE OFFICER FOR THE F-35 JOINT PROGRAM OFFICE

    General Bogdan. Thank you, Congressman.
    Congressman and Ranking Member Sanchez and distinguished 
members of the committee, thank you for the opportunity to 
address this committee and discuss the F-35 Lightning II 
program today. Over the past few years, we focused on creating 
and maintaining a realistic program baseline for DOD's largest 
acquisition program. And despite a turbulent past, the program 
is making slow but steady progress on all fronts to include 
technical improvements and driving costs out of the program. I 
believe the F-35 program is headed in the right direction now, 
and I am confident in our ability to meet U.S. Marine Corps 
initial operating capability and Air Force initial operating 
capability in the summers of 2015 and 2016, respectively, with 
all the capabilities our warfighters need.
    We are now seeing the benefits of a disciplined systems 
engineering process that we instituted a few years ago in 
response to many of our technical issues, including 
improvements in the helmet, the hook, our fuel dump capability, 
weapons capability, lightning protection, and night and all-
weather flying. We are closely managing F-35 on-board and off-
board software, and software still remains the number one risk 
on the program.
    We have also fundamentally changed the way we are 
developing the ALIS system, our [Automatic] Logistics 
Information System, and are starting to see some incremental 
improvements there.
    We are also fully committed to making the F-35 more 
affordable in both the cost of buying the airplanes and the 
cost of operating and sustaining the aircraft.
    Finally, I want to thank the Congress and the Department of 
Defense for their support during the past 2 years of budget 
instability. The program has weathered this storm relatively 
intact. We have made no changes to the development program, and 
our aircraft quantities were preserved in fiscal year 2013 and 
fiscal year 2014, though the Department has reduced quantities 
in fiscal year 2015.
    I would like to close by saying that my team is focused and 
committed to doing the very best we can for the warfighters, 
the taxpayers, and our partners to ensure the F-35 meets all of 
our needs. To that end, my team is rising to the challenge of 
managing this very large and complex program with integrity, 
transparency, accountability, and discipline.
    I ask that you hold me and my team accountable in the 
coming years to ensure that we develop and deliver the 
warfighting capability that this country needs and expects.
    I look forward to taking your questions.
    [The prepared statement of General Bogdan can be found in 
the Appendix on page 33.]
    Mr. Runyan. Thank you, General.
    Mr. Sullivan.

 STATEMENT OF MICHAEL J. SULLIVAN, DIRECTOR OF ACQUISITION AND 
        SOURCING, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Sullivan. Thank you, Mr. Chairman, Ranking Member 
Sanchez, members of the subcommittee.
    Thank you for the opportunity to discuss our work on the F-
35 Lightning II, also known as the Joint Strike Fighter. With 
estimated costs near $400 billion today, the F-35 is the 
Department's most costly acquisition program. And with its 
three variants, it will provide fifth-generation fighter 
capabilities for the United States Air Force, Navy, and Marine 
Corps, as well as eight international partners.
    As we have reported in the past, the program's acquisition 
strategy originally called for high levels of concurrency 
between testing and production, and, as a result, it has 
encountered significant costs and schedule growth, and has been 
restructured three times.
    First in 2003 and then again in 2007 and then again in 
2012, when the Department increased the program's cost 
estimates, extended its testing and delivery schedules, and 
deferred the procurement of 410 aircraft into the future. Since 
that time, the program has remained stable; costs and schedule 
has also remained stable.
    My testimony today is based on our March 2014 report, which 
was just released Monday, and I believe the committee has a 
copy of. And I would like to just make some quick points on the 
risk the program still faces concerning software development 
and future funding as well as some of the progress they have 
made with regard to manufacturing.
    Software development challenges continued through 2013 due 
largely to delays in getting the software for Block 2B to 
flight test, then limited capability once it was delivered, and 
the need to fix and retest multiple software versions. So there 
is a lot of churn with the software development at this time.
    In addition to risking the delivery of less than required 
initial operating capabilities for the Marines by 2015, these 
delays could increase the already significant concurrency 
between testing and procurement and result in additional cost 
growth. So there is--I am talking about this in terms of risk 
potential, not necessarily things that are happening today.
    Finally, without a clear understanding of the initial 
capabilities that will be delivered, the services may not be 
able to make fully informed resource allocation decisions. To 
execute the program as planned, the Department plans to 
increase annual funding steeply over the next 5 years. It has a 
total of more than $50 billion in its current Future Years 
Defense Plan, and after that, it then plans to sustain an 
average of about $12.6 billion per year for this aircraft 
through 2037.
    So annual funding of this magnitude clearly poses long-term 
affordability risks, especially given the nature of the current 
fiscal environment. The Under Secretary of Defense for 
Acquisition, Technology, and Logistics has directed the program 
to find ways to reduce unit costs on these aircraft before 
full-rate production begins. But meeting those targets will be 
challenging, as significant cost reductions are still needed 
there.
    Sustainment cost estimates also strain affordability 
constraints. The Department's most recent estimates for 
operating and supporting the F-35 fleet are somewhere between 
$850 billion and $1 trillion, which Department officials have 
deemed unaffordable. The key driver separating those estimating 
assumptions is assumptions about future inflation rates.
    On the upside, the aircraft manufacturing continued to 
improve in 2013. As the number of aircraft in production has 
increased, manufacturing efficiency has increased 
significantly, and the contractor has steadily reduced the 
overall labor hours needed to manufacture the aircraft.
    In 2013, the contractor delivered 35 aircraft to the 
government, 5 more than it delivered in 2012 and 26 more than 
it delivered in 2011, and it is on track to deliver 39 more 
aircraft in 2014. It has now delivered just over 100 aircraft 
and has another 75 in process.
    To summarize, the Department has made a number of difficult 
decisions through the years to put the F-35 on more sound 
footing, but more risks lie ahead, and it will be important as 
to how these risks are managed. If software delays continue, if 
funding falls short of expectations, or if unit cost targets 
cannot be met, the Department may have to consider whether to 
proceed with production as planned or alter production rates in 
the future.
    At this point, we believe the most pressing issue is the 
effect software delays are likely to have on the initial 
capabilities that each military service will receive. To make 
informed decisions about weapons system investments and force 
structure, the services must have a clear understanding of the 
capabilities that the initial operational F-35 will possess. 
Thus in our annual report, we recommended that the Department 
assess the capabilities that can realistically be delivered to 
each of the services by their established ILC [initial launch 
capability] dates and share the results of the assessment with 
the Congress and the services as soon as possible.
    Mr. Chairman, that completes my prepared statement. I would 
be pleased to take questions.
    [The prepared statement of Mr. Sullivan can be found in the 
Appendix on page 64.]
    Mr. Turner [presiding]. Mr. Sullivan, since you are from 
Wright-Patterson Air Force Base in Dayton, Ohio, it would be 
perfectly appropriate to say ``Go Flyers'' at the end of your 
testimony.
    Mr. Sullivan. Well, Mr. Chairman, I am also a brand new 
grandfather, if I could. Charlie Sullivan was born Monday.
    Mr. Turner. Excellent. Congratulations.
    Mr. Sullivan. Mother and son are doing well.
    Mr. Turner. Excellent.
    Mr. Sullivan. Go Flyers.
    Mr. Turner. There you go.
    You know, obviously, Mr. Sullivan, as I stated in my 
opening statement, we are very concerned about the software 
delays. And recognizing that the issue is one of both, you 
know, operational capability and inventiveness, it is not as if 
we are--this is off-the-shelf software completion, this is 
where actual advances need to occur.
    What is your concerns about what these additional impacts 
could be on the program with these delays? This obviously is 
one that can cascade, the software being one of the leading 
aspects of development.
    Mr. Sullivan. Yes. That is a good question, Mr. Chairman. I 
think there are two parts to that. The first one is just the 
risk that you don't get the software completed, that you don't 
get full capability, and I think there still is risk in that 
area. Very, very, very complex software development has to go 
to get the sensor fusion and all of the communications across 
many different platforms that they are going to need on this 
aircraft. By the time they complete block 3F, which is the 
final software.
    So there is still an enormous amount of complexity. This 
program had started its software and has developed it in 
blocks, from block 0 all the way up to Block 3F. And as they 
have delivered the blocks, there has been spillover from one 
block to the next block, and so that creates inefficiencies, 
more churn, and kind of a more chaotic environment. So there is 
all of that the program is working with now is trying to get 
the earlier blocks finished up while they are still trying 
deliver very complex software. A lot of costs and schedule 
strain on that.
    And, the other thing that it means to the program, I think, 
I mentioned in my statement that concurrency was a huge issue 
on this aircraft program. And the longer it takes to complete 
that software development, of course, the longer you remain 
concurrent between testing and production, and that means that 
more changes could take place before you finally get the 
aircraft that you want. You might also have to keep software 
engineers around longer, you might have to stay in development 
longer. All of that stuff creates cost and inefficiency.
    Mr. Turner. General, looking at the GAO's report about the 
software delays, obviously the concern is the end goal of 
delivering warfighting capabilities, the concerns about the 
warfighting capabilities to the Marine Corps by July 2015. 
Could you please describe these impacts, especially since we 
are in a period of time where the Air Force is looking at 
divesting of other weapons systems, aircraft. Is the gap going 
to get bigger?
    General Bogdan. Sir, right now, the three increments of 
software that I am watching very carefully and, oh, by the way, 
when Mr. Sullivan talks about concurrency, we are also a little 
bit concurrent when it comes to software development. Because 
we are currently finishing up our 2B capability, interim 
capability. At the same time, we are in the middle of our 3I 
capability, which is the exportable version of the F-35, and 
then finally that 3F capability.
    So when I make my comments, I will have to talk about each 
of those individually. Because, quite frankly, the risk is 
different for all three.
    For the 2B capability that the U.S. Marine Corps is going 
to use to declare IOC [initial operational capability] and 
limited warfighting capability, we are tracking 206 individual 
capabilities within the software, and those are what the U.S. 
Marine Corps needs to declare IOC.
    As of today, 80 percent of those have been verified as good 
to go. We have 20 percent left. And I have two more increments 
of software to go this summer before I finish flight testing 
for 2B at the end of the year.
    My assessment, and my look at the technical risk and the 
flight test program, is that I am within 30 days of completing 
2B on time. So fundamentally very, very little risk in 
delivering software-wise the capability to the U.S. Marine 
Corps.
    What I will tell you is more troubling for Marine Corps 
IOC, and I will just mention it here, and we can get it later. 
Modifying all of the older airplanes to the production-
representative configuration that the Marine Corps needs to go 
to war with, is even more of a problem than the software in 
2015. So that is 2B. I am pretty confident on the software 
capability, a little less confident on the mods 
[modifications].
    The 3I capability, for U.S. Air Force, also quite 
confident. They have an extra year for us to get it right 
before they declare IOC, and it has the same capability as 2B. 
So, fundamentally, there is some time margin built into that.
    And, finally, the last capability, the 3F capability, that 
is the one I am most concerned about in terms of schedule 
delay. I will tell you today, if we don't do anything else and 
we just continue to perform the way we are performing right now 
and not getting any better, we are going to be somewhere 
between 4 and 6 months late on that software. It is as simple 
as that. And that has impact not only on the U.S. Navy's 
ability to declare IOC, but some of our partners and their 
ability to field what they consider to be a minimum capable 
airplane.
    That is unmitigated. I haven't done any--there are a lot of 
things I can do between now and 2018 to bring that back to a 
more reasonable timeframe. But if I had to tell you today, I 
would say 4 to 6 months late. And it has mainly to do with the 
complexity of the software work we have to do in 2016 and 2017. 
It is really, really hard stuff. And I am just projecting that 
we are going to have some trouble getting it done.
    Mr. Turner. General, my last question, the news articles 
that Italy may be delaying its acquisition of 90 F-35s, what is 
the status of the foreign acquisition programs with our 
partners? It obviously both significantly affects our cost 
structure but also the development path.
    General Bogdan. Absolutely, sir. The biggest impact our 
partners have today when it comes to the quantity of airplanes 
they are buying and when they buy them is the unit cost of the 
airplane. In fact, the partners have a greater impact on either 
reducing the cost of the airplane or actually--I won't say 
increasing the cost of the airplane, because it will always 
cost cheaper, later. We have made that commitment to the 
enterprise. But that cost reduction gets smaller. Even greater 
than any movement our services have made at this time. So they 
are very, very important to the cost curve as we call it.
    Relative to Italy, some of the press reports, at least in 
the conversations I have had with the senior leadership with 
the Italian Air Force and their Ministry of Defense, and I have 
had conversations with them recently, their Prime Minister has 
said that future investment in the F-35 is on hold. Okay, so 
they have committed to buying a certain number of airplanes in 
their FACO [Final Assembly and Check Out], or their fabrication 
facility in Cameri, Italy.
    And they will buy those airplanes. But their future buy 
beyond that, beyond the first 20-some-odd airplanes is on hold 
until such time as their Parliament decides what to do. So that 
is an instability for us that could affect future prices.
    Turkey, the same. They have delayed their buy 2 years. They 
were anticipating this year that they would come on board and 
fully commit to buying. They have not yet. So we are waiting 
there.
    And Canada would be the third country where we are waiting 
to see how their political process plays out.
    If those three partners choose to push airplanes out or 
choose to reduce their buy on airplanes, it will have an effect 
on the price of all the other partners and the services buying 
the airplanes to the tune of about 2-3 percent increase in 
price.
    Mr. Turner. General, to the extent that our subcommittee 
may help in trying to communicate some of the issues of the 
advantages of the F-35 and foreign acquisition decisionmaking, 
please let us know. We know there is a lot of legislative 
discussion among their Parliaments and legislators that perhaps 
we can help effect. Please do and include us if there are 
issues where we can make a difference.
    Ms. Sanchez.
    Ms. Sanchez. Thank you, Mr. Chairman.
    I will just note for those who are on committee who haven't 
been following this, as we go out on the timeline, the per-unit 
cost of the F-35, supposedly, theoretically, will come down. 
And so when our foreign partners are looking, they want to 
catch the end part of that in order to have their per-unit 
costs come down, rather than catch the front end. So a lot of 
them are figuring--so it is not because they don't want them, 
it is because they want to find the sweetest spot they possibly 
can when it comes to per-unit costs. Am I not correct, General?
    General Bogdan. You said that very well, ma'am.
    Ms. Sanchez. Yes.
    General Bogdan. However, the other part of that is, as you 
know, the other side of that coin is, those people that need 
the airplane sooner----
    Ms. Sanchez. Right.
    General Bogdan [continuing]. Will now pay that price.
    Ms. Sanchez. Right. Or those of us--with the U.S., if our 
foreign partners move out on that timeline, then the cost per 
unit for us, sitting on that timeline of keeping the production 
going and bringing down the cost, is higher to us. So it is a 
real interesting game we play.
    General Bogdan. But there is one thing, and I don't want to 
interrupt, our FMS [foreign military sales] customers, who are 
different from our partners, they are actually offsetting a lot 
of the movement that our partners have made in pushing 
airplanes out and the U.S. services. So our FMS customers are 
filling the gap, so to speak, over the next few years, and that 
is helpful.
    Ms. Sanchez. Okay. General, you have been quoted many, many 
times as saying that there is no more money and no more time, 
when it come to the F-35 program. Correct?
    General Bogdan. Yes, ma'am.
    Ms. Sanchez. Well, just this week, the committee was 
briefed by your office and was told that in 2015, our partner 
nations on this program have agreed to provide $400 million in 
additional funding. While that is good news, in theory, that 
our partners are willing to provide the extra money, does that 
mean that we have $400 million cost increase in development 
that these funds are covering up?
    What is happening----
    General Bogdan. Yes, ma'am.
    Ms. Sanchez [continuing]. With these $400 million that you 
told me----
    General Bogdan. Well----
    Ms. Sanchez [continuing]. That it is enough, remember you 
spent it, it is done. You are going to work within that time, 
that time and that money allotment. I have heard this over and 
over, and now I am getting, oh, by the way, somebody is 
throwing in another $400 million into the pot.
    General Bogdan. Yes, ma'am. A couple of things. The money 
that the partners have generously offered for development work 
came from prior savings that they had on the program in terms 
of what they had budgeted for and what they are paying for 
airplanes and paying for things right now.
    So this was not our partners going back and asking the 
governments for more money. They didn't do that. What we did 
with this--what we are going to do with that money is we are 
going to use it in development to offset what the services 
would have to pay over the next 5 years. The price of--the end 
price of development has not changed. All we have done is moved 
that $400 million into the SDD [Strategic Deployment Document] 
line so that we could help offset the Navy, the Marine Corps, 
and the Air Force's bill for the next 5 years for development.
    Ms. Sanchez. So what--I am trying to understand what you 
just said to me. But it seems to me that what you said was our 
partners have--they had allocated more, they are going to spend 
less for what they thought they were going to get. They have 
some additional monies they are going to put into the 
development phase, and that phase would have been picked up by 
the Navy, the Army, and the Marines. And now our Army, and 
Navy, and Marines don't have to put that money there. So are 
they going to come and give the committee the $400 million to 
put somewhere else?
    General Bogdan. So, so I will make two points about that. I 
will make two points about that.
    The first point is, the reason why the partners chose to do 
this is because, as you recall, Mr. Sullivan said the program 
had been re-baselined three times.
    Ms. Sanchez. Uh-huh.
    General Bogdan. In re-baselining the program three times, 
the Department of Defense put in 13.5 billion more dollars than 
it expected to for development, and none of that money came 
from the partners. Because they had made the initial investment 
in SDD and never contributed anything further.
    So as a show of good faith for that $13 and a half billion 
that the Department of Defense picked up, that is why they 
agreed that this added money could be used.
    When we put our POM [program objective memorandum] in our 
President's budget each year, I let the services know how much 
money I need each year for the development program. In 2015, 
where I am going to book that $400 million, I reduced the bill 
to the services by that amount. So when they put in their 
fiscal year 2015 President's budget, it included $400 million 
from our partners, which reduced their bill, and, therefore, 
they could use that money for other things.
    Ms. Sanchez. So noted. We are going to take it back and 
take a look and make sure that that is what happened.
    Mr. Chairman.
    Mr. Turner. Mr. Enyart.
    Mr. Enyart. Thank you, Mr. Chairman.
    General Bogdan, I am glad to see that you grew up in KC-
135s and that was the first operational aircraft you flew. And 
I am glad also to see that you worked on the KC-46 program.
    And I guess what concerns me is with all of the talk about 
the mushrooming costs in the F-35, as you well know, the design 
of the 135s is over 60 years old. Most of the airframes the 
crews are flying are now older than the crews. And, of course, 
the KC-46 modernization program is vital to the entire fleet. 
And do you foresee any problems with the funding of the KC-46 
Alpha, in light of the increasing costs that we have seen in 
the F-35?
    General Bogdan. I don't want to get too far out of my lane. 
I haven't been on the KC-46 program for a number of years. But 
as I do recall the development program for the KC-46 is a 
fixed-price development. So the U.S. government's liability is 
capped on how much it is going to pay for that development. And 
that was a choice Boeing made during the competition, that the 
tough competition they had for that program.
    So relative to the KC-46 and the Air Force budgets, I will 
defer to General Field and Dr. LaPlante.
    What I can say is, when I was the program director there, 
it was imperative that the Air Force funded each and every year 
of the development program because you do not want to underfund 
a fixed-development contract because the contractor will then 
have recourse to come back and say, You didn't give me all the 
money I needed, and, therefore, you slowed me down, therefore, 
we will change the terms and conditions later on.
    So it is important to keep the funding for the KC-46 on the 
development program constant because of that contract type, 
sir.
    Mr. Enyart. Thank you, General.
    I yield back, Mr. Chairman.
    Mr. Turner. Gentlemen, thank you very much for your 
testimony, and we appreciate the information you provided to 
the committee. We are going to turn to our next panel now.
    Ms. Sanchez. Question.
    General Bogdan. Thank you, Mr. Chairman.
    Ms. Sanchez. Before I let you go----
    Mr. Turner. Before I excuse you, my ranking member has a 
last question.
    Ms. Sanchez. I'm sorry, I had one other question that I 
felt was very important for our committee to hear.
    So the F-35 program figure shows that all three versions 
remain far below the planned level of reliability. 
Specifically, as of this month, the F-35A was 4 hours between 
critical failures as opposed to 13 hours expected. The F-35B 
was 3 and a half hours, when it should have been 7 and a half 
hours. And the F-35C was only 2.7 hours, however, we 
anticipated would be at 9 hours.
    If we weren't in such a large-scale production, it might be 
one thing. But we are there now. So that means that within a 
couple years the service will have hundreds of F-35s on their 
hands that won't be able to fly very often unless things get 
dramatically better. At this point, it looks like the program 
wouldn't even meet a 50-percent reliability goal when the 
aircraft are fully operational.
    So, I know that these will improve over time, but what are 
the specific steps that you are taking to lift that critical 
reliability time up?
    General Bogdan. I bet that is my question.
    You are right, ma'am. All three variants today are below 
what we call the reliability growth curve on the airplane. And 
``over time'' is not the right answer. Things will get better 
over time, but that is not the right answer.
    The right answer is, and we have started it now, was a 
fully funded, disciplined, reliability and maintainability 
[R&M] program that looks at all of the cost drivers, all of the 
pieces and parts that are coming off the airplane too often, 
the repair times for those parts, the supply chain and spares 
posturing. All of those things play into reliability and 
maintainability.
    And I can tell you, quite frankly, when we first started 
flying the airplane, one, we didn't have enough data to know 
where we were bad, so to speak, we have got more of that data; 
and, two, we didn't have a great focus on it because, quite 
frankly, the last few years the program was just trying to hang 
on.
    We are past that point now. We are at the point now where I 
have 58 operational airplanes out there. We have flown 12,000 
hours. We know what the cost drivers are, we know what parts 
are coming off too frequently, we know what maintenance 
procedures take too long. We have just got to go do something 
about it. So I started last year a fully funded, fully 
dedicated R&M program. I put a program manager in place. 
Lockheed Martin and Pratt & Whitney have done the same 
corporately on their side, putting folks in place. And we are 
systematically attacking that problem.
    The problem here is, you are not going to see results in 
the next 2 or 3 months. It is going for take months and months 
and months of constant effort to start seeing this improve. Our 
goal is by 2015 to have the aircraft availability at 60 
percent.
    Ms. Sanchez. Mr. Chairman, I think that is a very critical 
piece to this program, and that you and I need to sort of keep 
an eye, and ensure that this reliability figure continues to go 
up rather than stagnant as it is.
    Mr. Turner. Excellent. Absolutely.
    Mr. Sullivan. If I could, we have looked at the reliability 
too, and it is a really big concern now. It is very risky. In 
terms of not only getting the unit costs down on the aircraft 
but also in terms of the operating and support costs that are--
you know, the estimate right now is deemed unaffordable. That 
has all got as much to do with reliability of the aircraft as 
anything else. So this is a critical point.
    Ms. Sanchez. Yeah, if you are paying for it but you are not 
flying it, that is bad news.
    Mr. Sullivan. That's right.
    I mean, we have many examples from the past. The F-22 
program is an example where they are still working on 
reliability on that aircraft, and, in fact, have started 
additional acquisition programs to get that fixed today.
    Mr. Turner. Well, gentlemen, as I was excusing you, before 
you almost made an escape, but we have two members who were 
able to return to the hearing, both of which who have 
questions. We will turn to----
    Ms. Sanchez. Sorry, Mr. Chairman. But this is incredibly 
important.
    Mr. Turner. I am glad that our ranking member held you for 
a time----
    Ms. Sanchez. I might add that that $61 million program they 
are talking about, it is above the amount of money that we have 
going on. So----
    Mr. Turner. Giving the floor for Ms. Walorski.
    Mrs. Walorski. Thank you, Mr. Chairman.
    And sorry if you have already addressed this. But I just 
want to kind of follow up with Mr. Sullivan with what you were 
just talking about on this issue of the significant financial 
obligation on this--for the Air Force and the Navy being deemed 
unaffordable. And I apologize if you talked about this earlier. 
But are there specific steps or can you talk about how in the 
world this program can--we can drive the operating and 
sustainment costs down?
    Mr. Sullivan. That is a very good question, and it is--the 
last question was kind of dealing with that too.
    Mrs. Walorski. Yes.
    Mr. Sullivan. Since--and the program and the general here 
is dealing with O&S [operating and support] costs now, I know. 
They have many initiatives going on, trying to drive that down.
    So in order to get O&S costs down, you can do a lot of 
things. You can change the availability of the aircraft, you 
can have them fly less. You know, less flight hours mean less 
maintenance, and things like that. You can look at manning and 
try to reduce the number of people that it takes to keep an 
aircraft up and running.
    You can look at fuel costs, which is very good. That is a 
kind of uncontrollable. There is an awful lot about O&S that is 
uncontrollable. Fuel costs is one of those things. That is a 
big part of it.
    Inflation rates are, you know, who can predict inflation? 
That is a big part of it. So there are a lot of costs you can't 
control.
    But reliability is one of the best ways, if you can have a 
reliable weapons system, and that means designing in 
reliability. And the general talked about a reliability growth 
curve. That is really the critical thing that you want to keep 
an eye on. In order to get more reliability they drive down the 
reliability growth curve established from flight test and 
ground testing and things like that.
    That is the single, key, real root way to get O&S costs 
down more, is to improve reliability of the aircraft. And this 
program, with a lot of initiatives under way, but still, as the 
Congresswoman said, they are still only halfway there, and they 
are not that far away from full-rate production.
    Mrs. Walorski. Thank you.
    Thank you, Mr. Chairman.
    Mr. Turner. Mr. Barber.
    Mr. Barber. Thank you, Mr. Chairman.
    And before I begin my question, I just want to congratulate 
you on being a new grandparent.
    Mr. Sullivan. Thank you very much.
    Mr. Barber. It is awesome. I have five. They are wonderful, 
beautiful. Have you ever heard a grandparent say his kids are 
not wonderful or beautiful? But I hope you enjoy, because it is 
a great experience. I really appreciate it myself.
    Mr. Sullivan. Charlie is a gift.
    Mr. Barber. I want to thank you both for coming today.
    And I want to start off by saying that I am a very strong 
supporter of the F-35, and as you probably know, I would love 
to see this program, or this fighter flying in southern 
Arizona. Hopefully, one day we will be bedded down in Tucson.
    A recent survey that was conducted in my community, in fact 
it was just published about a week ago, showed overwhelming 
community support for Davis-Monthan Air Force Base, which is in 
my district, and the bedding down of the F-35. So I think that 
survey, which was done in an objective and scientific way, 
should put to rest any notion that our community is not 
interested in the F-35 or the future of the air base.
    So we have invested a lot in this program, obviously. And 
getting your arms around trying to make it more affordable and 
prevent future cost overruns. And since we have invested so 
much money, we have got to finish the job. I don't think it is 
any time to reconsider. But I am concerned, as my colleagues 
are, about the delays in the F-35 program, because it means, in 
my view, that during a time of fiscal uncertainty we will be 
spending more tax dollars while potentially negatively 
impacting on our air strategy.
    First, the development and procurement costs for this 
platform are already significant, as we've stated. And now 
delays in developmental flight testing will cost us more money 
as we fix recurring problems with emission systems. These 
delays could, I believe, prolong the delivery of the first 
batch of F-35s by an additional 13 months before it attains 
initial operational capability.
    The President's budget has called for divestment of an 
important air platform, many of them, including the A-10, so 
that the Air Force can modernize by acquiring the multi-role F-
35. And I would like to ask you, General, if we won't see the 
F-35 fielded until well after the Air Force begins to rid 
itself of important capabilities, such as the A-10, don't we 
leave our military men and women without the important tools 
they need?
    And would you agree that it would be prudent to maintain 
the A-10 warfighting capability until we can be assured or 
reassured that the F-35s will be ready?
    I am very concerned about this gap I think the divestment 
plan would create for our men and women on the ground.
    General Bogdan. Sir, I am going to defer most of that 
question to my Air Force brethren for the next panel. But what 
I will tell you is that we are intending on delivering an air-
to-ground and close-air-support capability with the F-35 in all 
three increments, 2B, 3I, and 3F, with 3F being the final 
capability. And I think the airplane from a technical 
standpoint and from a national standpoint will have the ability 
to conduct that mission safely and effectively for the Air 
Force. What they do with the A-10s, again, I will defer that to 
the next panel.
    Mr. Barber. Nice punt there, General. I understand. We will 
talk about it next panel.
    I just want to ask a follow-up question, though. Due to the 
uncertainty surrounding the delivery of the F-35 software 
capabilities, the GAO, as you know, Mr. Sullivan, recommended 
that DOD execute an assessment of the specific software 
capabilities that could realistically be delivered, and those 
that would not likely be delivered. How will the DOD conduct 
this assessment? And what software capabilities are most 
critical?
    And, additionally, if DOD follows the GAO recommendations 
and decides to lessen software capabilities, would this have 
any impact, in your view, on the proposed mission systems that 
would enable the F-35 to conduct adequate close air support, 
Mr. Sullivan?
    Mr. Sullivan. Okay. So our recommendation is that they 
assess where they are with software today in relation to the 2B 
software block that they are to deliver to the Marines for the 
Marines' IOC date, which is now scheduled for July 2015.
    So, what we are saying is, the Marines deserve to know 
exactly what they are going to get. So before that date, they 
should--there should be an assessment on, realistically, here 
is what we have for you.
    And I would go back--you mentioned a 13-month delay, and I 
know in our report we have a 13--we have something in there 
about 13 months' delay in software. But want to clarify that 
that is a delay that would only extend the IOC date 6 months. 
That 13-month delay would be from May of 2015 to November of 
2015. They right now are saying May. They have a 7-month kind 
of management reserve in there. The Cost Assessment and 
Programming Effectiveness, the CAPE from OSD [Office of the 
Secretary of Defense] has looked at that schedule and said that 
that they may be as late as 13 months beyond May. Which would 
put them to November of 2015. That is--so, all told, that is a 
6-month delay that the CAPE is talking about. That is what we 
refer to in our report.
    So what our recommendation is, is really just to assess 
software and let people know what is going to be available to 
them on these key dates. July 2015 is one. If the Marines 
aren't going to get the full 2B block capability, then they 
should know what they are getting. They should have, you know, 
the ability to delay if it is going to be a little bit longer 
to get full 2B. That is essentially what we are saying.
    Mr. Barber. I guess I just close----
    Mr. Sullivan. We are not by any means saying that they 
should--that the JSF [Joint Strike Fighter] should be delivered 
without full capability eventually.
    Mr. Barber. I just would wonder, though, since we have had 
so many delays, so many promises made that have not been kept, 
General, how can we be assured that these timelines are real?
    General Bogdan. I will give you a two-part answer, sir. The 
first answer is rooted in the technical underpinning of the re-
baseline that we did starting in 2010. We added time and margin 
into that schedule from 2010 to 2018, and we made it much more 
realistic. We planned for discovery that we hadn't foreseen, we 
planned for delays in flight testing. We planned for a lot of 
things that were more optimistically planned for before that. I 
guess that is the best way to say it.
    So from that perspective, the dates that I am giving you 
are on that baseline plan from 2010, and we are currently 
executing to that plan without changing. The other--so that is 
the technical answer, sir.
    The other answer is, I am not here to advocate for the F-
35, necessarily. I am here to execute the program. And I want 
to give you the best information I can, good, bad, or 
otherwise.
    And so the other part of my answer is, you will--you 
somehow, somehow have to trust me, and if I am wrong then you 
guys can take it out on me. Because I consider myself 
accountable for the outcomes on this program.
    Mr. Turner. Well, Mr. Barber, we are going to ask that----
    Mr. Barber. Thank you, Mr. Chairman.
    Mr. Turner. I ask that the remainder of your questions be 
submitted for the record. We do need to get to the second 
panel.
    Thank you, gentlemen. We appreciate your testimony.
    General Bogdan. Thank you.
    Mr. Turner. Next, we will go to Vice Admiral Paul 
Grosklags; Lieutenant General Robert Schmidle; Michael Manazir, 
and--Rear Admiral; and Dr. William LaPlante, Military Deputy 
Assistant Secretary of the Air Force for Acquisition; and 
General Field, United States Air Force.
    I understand the two opening statements will be given by 
Admiral Grosklags and Dr. LaPlante.
    Turning to Admiral.

 STATEMENT OF VADM PAUL A. GROSKLAGS, USN, PRINCIPAL MILITARY 
DEPUTY, ASSISTANT SECRETARY OF THE NAVY, RESEARCH, DEVELOPMENT 
AND ACQUISITION; ACCOMPANIED BY LTGEN ROBERT E. SCHMIDLE, JR., 
 USMC, DEPUTY COMMANDANT FOR AVIATION, U.S. MARINE CORPS, AND 
 RADM MICHAEL C. MANAZIR, USN, DIRECTOR, AIR WARFARE, OPNAV N98

    Admiral Grosklags. Thank you, sir.
    Chairman Turner, Representative Sanchez, distinguished 
members of the subcommittee, thanks for the opportunity to be 
here today to talk about our Naval and Marine Corps aviation 
programs.
    As I think you are aware, we had to make many difficult 
decisions as we built our 2015 budget submission. But we 
believe what we have submitted for your consideration is a plan 
that ensures we have the capacity and the capability to ensure 
that we can fight and win when called upon.
    But I also have to tell you that this is a plan that 
contains increased levels of risk as opposed to our PB 2014 
[President's budget for fiscal year 2014] submission. Now, on 
our 2015 submission, we are continuing development of fifth-
generation aircraft. We are fully committed to both the F-35B 
and the F-35C, and believe the program is on a solid path to 
meeting our initial operational requirements for the Marine 
Corps in 2015 and the Navy in late 2018 or early 2019.
    Our unmanned aircraft systems also maintain a full measure 
of our attention. These include already fielded systems at the 
unit level, like the Marine Corps' RQ-21 Blackjack, all the way 
up to carrier strike group and carrier air wing platforms, like 
the Unmanned Carrier Launched Airborne Strike and Surveillance 
aircraft, otherwise known as UCLASS. It is a mouthful.
    We also continue investment in our critical development 
programs, such as the 53K Heavy Lift Helicopter, the MQ-4C 
Triton unmanned maritime surveillance aircraft, and the 
Presidential helicopter program.
    And we are recapitalizing in other areas. Maritime patrol, 
with the P-8 replacing the P-3, our carrier-based early warning 
aircraft with the E-2D, and virtually all of our vertical-lift 
and tiltrotor aircraft with the V-22, our H-60s, and the H-1.
    And, finally, but not in the least, we have focused 
investments being made in our currently fielded aircraft and 
systems to ensure that they remain relevant, they remain safe, 
and that they are able to counter the threat well into the next 
decade.
    Now, as I mentioned earlier, the efforts that we are 
undertaking I have just described are not without risk. Even 
with the spending levels supported by the Bipartisan Budget 
Agreement, we have been forced to extend some development 
timelines, we have reduced our procurement rates, and we have 
reduced the rates at which we have planned to modernize both 
capability and capacity.
    And, frankly, a transition back to the Budget Control Act 
levels of spending will have a significant negative impact on 
our readiness, our modernization, and eventually the relevancy 
of Naval Aviation. Ultimately, this result is increased risk to 
our operating forces forward deployed.
    So, Mr. Chairman, we appreciate the opportunity and look 
forward to your questions.
    [The joint prepared statement of Admiral Grosklags, General 
Schmidle, and Admiral Manazir can be found in the Appendix on 
page 76.]
    Mr. Turner. Dr. LaPlante.

 STATEMENT OF WILLIAM A. LAPLANTE, ASSISTANT SECRETARY OF THE 
  AIR FORCE FOR ACQUISITION; ACCOMPANIED BY LT GEN BURTON M. 
 FIELD, USAF, DEPUTY CHIEF OF STAFF FOR OPERATIONS, PLANS AND 
                  REQUIREMENTS, U.S. AIR FORCE

    Dr. LaPlante. Thank you, Chairman Turner.
    Thank you, Ranking Member Sanchez, other members of the--
distinguished members of the subcommittee. Thanks for having 
the hearing. And already we have already had good discussions 
and good questions; so, thank you for having the hearing and 
for what you do.
    I am joined here by Lieutenant General Burt Field, who is 
the Deputy Chief of Staff of the Air Force for Operations, 
Requirements and Plans. So we are here to talk about the fiscal 
year 2015 budget that we have submitted and the tough choices 
that we have already talked about here.
    Just like my Navy counterpart, the Air Force, all the 
services had to make these tough choices. The choices were 
between the things we know, readiness today, if we have to go 
to war today, versus building the force that we know we need 
for the next 10, 15 years.
    We also know as we watch around the world, regardless of 
whatever threat assessment you think, that the technologies are 
proliferating. Particularly, places where we are used to just 
being able to operate at will--space, cyber, air--we can't 
assume that in the future.
    The technologies to contest that are proliferating, and we 
have to plan for that. We also have to plan for being able to 
react quickly and globally.
    So in this tough environment there was tough choices being 
made, and we have talked about some of those hard choices 
already.
    I would say, if the last time that some of us appeared 
before you was back in October, it was a hearing about the 
effects of the sequester. And I just want to contrast and thank 
you from where we are then from where we are now and, also, 
talk about still issues we have problems with.
    First of all, back then, what we were telling you was, to 
meet the sequester numbers, we were having to make this very 
difficult choice between readiness today--flying hours, weapons 
systems sustainment, going into depots--and investment in RDT&E 
[research, development, test and evaluation] really were the 
only two places we could take the money, and it was a very 
difficult situation. We asked you also to help us with just 
understanding stability so we could do planning.
    But with the BBA [Bipartisan Budget Act], you have given 
us--and I want to thank you for that--some stability. We now 
know what the budget is. We know what to plan for in 2014. We 
know what to plan for 2015, in particular. And we have a down 
payment to begin to turn back and upturn and working on 
readiness. Readiness is not going to be fixed with turning a 
switch, as you know, but thank you for the BBA because it is 
going to allow us to start working on that again.
    The other thing the BBA did a bit--and I want to just 
temper what it was able to do for us--we did use a little bit 
of it in the Air Force to protect some of our high-priority 
programs.
    Specifically, we were able to protect the F-35 buy. I think 
back in October we said that, had the sequester occurred, we 
had four to five airplanes at risk in F-35. That was able to be 
mitigated with the BBA in 2014. And the same would have had to 
happen in 2015. So that helped us there. And we were able to do 
some to help us stay above minimal sustainable rates in 
munitions.
    But, largely, what the BBA does for us is it gives us 
stability and it helps us turn the corner back again, begin to, 
in readiness.
    But here is what the BBA does not do. If we return to the 
sequester numbers in 2016 and beyond, we still have the reality 
of a smaller Air Force. We are going to have a smaller Air 
Force regardless.
    But, as has been said, platforms like the KC-10, the Global 
Hawk Block 40, technologies--exciting technologies like the new 
engine technology that we are looking at for adaptable 
engines--all of those frankly do not survive mathematically if 
you look at it in a sequester budget beyond 2016.
    And so that longer-term situation remains unchanged, and we 
are having to plan for that, but the near-term situation is 
significantly different than when at least I appeared before 
you back in October.
    So that is a summary of what I wanted to say, and I look 
forward to answering your questions. And I also, again, enjoyed 
the discussion on F-35 and would be happy to talk more about 
that. Thanks.
    [The joint prepared statement of Dr. LaPlante and General 
Field can be found in the Appendix on page 106.]
    Mr. Turner. Dr. LaPlante, your statement is an excellent 
transition to my questions for General Field and Admiral 
Manazir and General Schmidle.
    I opposed sequestration because I thought it would be 
irresponsible and devastating to our military. Sometimes 
pessimists are right. I am not optimistic about what we are 
facing for 2016 and on.
    I believe that part of the reason why sequestration was put 
into effect is because the picture of what would occur if 
sequestration was implemented was not told, in part, because 
DOD was constrained from planning for sequestration until it 
was upon us and then, when they were implementing it, they 
didn't have the time to be able to look up from their desks and 
explain what was to happen.
    So my question to each of you is: If you are forced to 
accept sequestration-level budgets between 2016 and 2023, how 
will that affect capability, capacity of each of your branches, 
Air Force, Marines, and Navy? And how does that affect your 
ability to meet the requirements of the National Defense 
Strategy?
    General Schmidle, we will begin with you.
    General Schmidle. Okay. Thank you, Chairman, and Ranking 
Member Sanchez.
    So, to begin with, the sequestration, as you know, 
Chairman--there is two things that affect us, two big bins. One 
of them is readiness and the other one is in our investment 
portfolios. And we--the example that we used--oh. Sorry. Better 
now? Okay.
    The example that we talked about last year was the number 
of F-18s that we had that were in reporting status as opposed 
to the number that were out of reporting status.
    Just a couple of snapshots of where we are today. About 50 
percent of the airplanes that--the Marine Corps F-18s that we 
own are not on our flight lines.
    They are going through depot maintenance, and they are in 
various places where they are getting modified so that we can 
continue to fly them until we get enough F-35s to be able to 
move into the fleet to make up for those to replace those 
airplanes.
    So that is an effect that we have noticed right away from 
sequestration because of the workforce that was being paid, if 
you will, to work in the depots to do that.
    The other place that we would notice it is in all the 
aircraft procurement programs. As you know, sequestration comes 
in and it just takes a bite out of a--a percentage, if you 
will, out of each of the program element lines.
    And we don't have a lot of choice in that. We have to pay 
the bills somehow. So you are going to have--our ability to buy 
more to modernize our airplanes is going to be affected as 
well.
    And the third piece of this--or the second big piece, if 
you will, is readiness. Sequestration would have an effect on 
readiness, which would equate to about 10 percent, if you will, 
of the flying hours that we fly every year.
    And if you just do the problem mathematically, right now, 
today, as of right now, we have a little over 70 percent, 73 
percent of all the airplanes in Marine aviation, all of them, 
are at--the readiness level for all of our squadrons, rather, 
is at what we would refer to as C2, which is ready to go to 
war. That was in 2013.
    In 2014, as where we are today, we are at 65 percent, and 
that is--and it would be lower except for the money that we got 
back in the BBA.
    If we continue on that rate, by the time we get to 2017, if 
we are fully sequestered, we will be down to--around 50 percent 
of our forces will actually be at the level of readiness that 
we would want them to be at in order to push them out the door, 
and by 2021 we estimate that we could be as low as 27 to 30 
percent.
    So that is over time what happens to us when we take the 
flight hours out, we don't have the hours to fly, we don't have 
the airplanes to use to train the pilots, and the readiness 
continues to go down.
    So that is probably the best example that I can give you 
between the investment accounts and the readiness of how that 
is going to affect us.
    Mr. Turner. Admiral.
    Admiral Manazir. Mr. Chairman, thank you for the question.
    I share the concerns that General Schmidle laid out 
because, as you know, Naval Aviation is Navy and Marine Corps 
aircraft. I will start far term, then midterm, then near term.
    Far term is procurement of aircraft. As we continue to buy 
our P-8 out to the end of the FYDP [Future Years Defense 
Program], as we continue to buy the unmanned systems with N-26 
sponsorship and N-98 sponsorship to the end of the FYDP year, 
as we continue to look to buy JSF and we continue to look at 
the numbers of the EA-18G Growlers that are coming this way in 
the execution year and then potentially in fiscal year 2016, 
you will see those numbers go down because that is where the 
flexibility comes from.
    In the midterm, our modernization is to keep our forces 
relevant. So in Naval Aviation, as we increment the P-8 to 
greater capability, as we increment the air plan or flight plan 
for the F-18E and F Super Hornet and make those more relevant, 
those capabilities will be pushed out 1 year and 2 years to the 
right. The initial operational capabilities of those advanced 
Super Hornets, advanced aircraft, advanced P-8s, will be pushed 
to the right.
    And then near term is readiness. As the general laid out, 
we normally like to push our forces out with C2 readiness to be 
able to accomplish any mission across the spectrum of 
warfighting. We would have to lower that down to a lower level, 
but what we would do is we would push those deployed forces out 
with a C2. It is the search forces behind them that would take 
the greatest impact.
    I will give you an example, sir. Last year, a year ago, I 
was the strike group commander for the Eisenhower Strike Group. 
Because of sequestration, we were told to come home, do flight 
deck maintenance, and in 2 months took the entire strike group 
back out again to the Gulf.
    So we turned around in two deployments, 10\1/2\ months 
deployed in 12 months, and we took the surface forces with us 
to do that. That was a direct impact of the sequestration 
levels of readiness that we had to take our previously trained 
strike group and turn around twice. So that surge force was not 
available to back up what we have out on the line.
    You will see very, very capable forces on the line, Navy 
and Marine Corps. What you will find is the surge forces behind 
them are going to start to hollow out. As the sequestration 
levels go down to what they were during the BCA, you will see 
no surge forces behind them. With the current BBA, you will see 
a surge force of one to two behind what you have currently got 
deployed.
    Thank you, sir.
    Mr. Turner. General.
    General Field. Thank you, Mr. Chairman.
    This will sound remarkably similar to my colleagues. You 
will have a smaller, less capable, less ready, less viable Air 
Force that will not be able to execute the Defense Strategic 
Guidance. That is the bottom line.
    And similar to what the Marines and the Navy just said, 
what happens is we are in an--at risk will be some of our 
highest priority programs, the F-35, the long-range strike 
bomber, and the KC-46, although those are the three that we are 
going to try to protect the most.
    What will also be on the table will be the KC-10, the RQ-4 
Global Hawk, other ISR [intelligence, surveillance, and 
reconnaissance] assets. Virtually every modernization program 
that has not already been cut will be on the floor, and that is 
what will lead to that smaller and less capable and less viable 
force.
    Like the Marines and the Navy, our readiness suffered. As 
we told you last year, our readiness levels were remarkably low 
prior to sequester, and we were looking at a 3- to 6-month 
effort just to recover to that already too low level.
    In some of our squadrons of the 31 we stood down, we have 
recovered that readiness. In other squadrons, we are still 
working to recover back to those levels that were already too 
low.
    We will have to probably attack that readiness problem 
again, and we will probably have more squadrons stood down for 
periods of time that will inhibit any recovery of the readiness 
for the future.
    Mr. Turner. Ms. Sanchez.
    Ms. Sanchez. Thank you, Mr. Chairman.
    I just want to put down for the record--because I heard 
General--our Marine General here say a comment. He said we have 
to pay the bills somehow.
    So we got into sequestration because we had to pay our 
bills somehow, and that was the fight that was going on at the 
time. So it seems like nobody would want to vote in a 
sequester.
    But the problem was there were some that were holding up 
our ability to pay the bills that we, as a Congress, had 
already agreed to pay. So that is how we ended up where we are.
    To the Admiral, the Navy has stated that the production of 
the F-18 will end in 2016 or 2017 unless additional foreign 
military serials occur and that, as a result, the U.S. will be 
left with only one production line for manned tactical fighter 
aircraft. Some have proposed providing the Navy with additional 
EA-18G Growler electronic warfare aircraft in order to keep the 
production line going.
    So my questions are: Does the Navy have a validated 
requirement for more of these aircraft? If we, the Congress, 
would provide the additional aircraft, what would the Navy do 
with them if Congress doesn't provide additional people and 
operations, funding facilities, et cetera? Would you still use 
the extra aircraft? And if the production line is shut down, 
does that necessarily mean we wouldn't be able to start one up, 
for example, for a sixth-generation aircraft intended to 
replace something like the F-18, that the F-35 would not be in 
that space?
    Admiral Manazir. Thank you, Member Sanchez. Thank you for 
the multifaceted question. I will address the last part first.
    I will tell you, in the Naval Aviation, we don't know what 
``sixth generation'' means because we don't know what 
capability that brings us later on.
    To be fair, we are required to look--when any type model 
series goes out of service, at the end of its service life, 
like in the F-18E and F series, which is going to go out in 
2035, we will look at the range of gaps in capability that that 
Super Hornet delivers right now to the Nation and we will 
determine what the solution could be. It could be more F-35s. 
It could be an unmanned system. It could be a family of 
systems. We will look at capabilities across the board, not 
necessarily a one-for-one replacement out into the future.
    To the F-18E/F and the G, we have 563 Super Hornets, Es and 
Fs, that are currently being delivered, and the last bunch is 
going to be delivered to us in 2015, and that will complete the 
buy. And that is our requirement, 563 Es and Fs that provisions 
31 strike fighter squadrons on our carrier decks, including the 
attrition and reserve airplanes.
    The EA-18G Growler, we currently have 138 in our program of 
record. That 138 airplanes is 10 squadrons that are in our 
carrier air wings, the 10 carrier air wings that support our 11 
carriers that are currently in the budget, and then there are 5 
expeditionary squadrons. The last 2 squadrons of the EA-18G 
Growlers are being built to take the place of the Marine EA-6B 
Prowlers that are going to go out of service in 2019.
    If we were to get additional Growlers, what they would 
service is the joint mission. The 18G Growler, with the ALQ-99 
pod now and the next-generation pod in the future, services a 
large part of the electromagnetic spectrum. And as the CNO 
[Chief of Naval Operations] has testified multiple times, it is 
the domination of the electromagnetic spectrum that is going to 
ensure that we can get into anti-access environments.
    Having that high-end airplane with those high-end 
capabilities to address the electromagnetic threat allows us to 
be able to bring a family of systems. For instance, the F-35 is 
very, very capable in an electronic attack, but it has a narrow 
part of the spectrum. So the EA-18G supports in a complementary 
capability the F-35Bs and Cs when you put them forward. 
Families of systems called stand-in jammers that would get 
inside of those threat envelopes need to get standoff jamming 
support first before you get in there to allow us to have 
assured access.
    So what we are looking at now, ma'am, is a series of 
studies that look at the validated requirements above 138 EA-
18Gs to determine whether the joint fight, the interoperable 
fight, with the Marine Corps, the Navy, the Air Force, and our 
coalition partners requires additional EA-18Gs.
    I will tell you that the CNO has testified that there are 
22 Growlers on an unfunded requirements list. Of those 22 
Growlers--and thanks for the omnibus that gave us $75 million 
in AP [advanced procurement]; so, we have a little bit of a 
discount there from Congress--congressional action earlier--we 
would take those 22 Growlers and increase the PMAA [Primary 
Mission Aircraft Authorization] of the squadrons on the flight 
decks from 5 to 7.
    We have determined in our campaign analysis that, when you 
increase from 5 towards 8 aircraft, that actually gives us a 
knee in the curve to reduce the time of the campaign and 
increase the effectiveness of electromagnetic maneuver warfare.
    Ma'am, I hope that answered all of your questions.
    Ms. Sanchez. Well, we will have to digest everything you 
just told us and then probably come back with some more 
questions, Mr. Chairman. Thank you for the time.
    Mr. Turner. Mr. Wenstrup.
    Dr. Wenstrup. Thank you, Mr. Chairman.
    Thank you all for being here.
    Doctor, I have a question for you. And I do appreciate the 
Air Force having a continued effort with engine propulsion 
technology and developing that further. I think it is important 
not only for our capabilities and efficiency, but it--like 
anything else, it is important to our industrial base here.
    And I saw that the Secretary in the budget--2015 budget 
allocated $1 billion for next-generation jet technology 
development.
    And so my question is: Can you give me some detail on how 
this funding will be used and when it would be used?
    Dr. LaPlante. Yeah. We are still working through the 
details of it; so, I can tell you just broadly what we are 
thinking.
    So the program and the research area that has been 
ongoing--and it has been some excellent work sponsored, in 
part--began with DARPA [Defense Advanced Research Projects 
Agency], but then moved over to AFRL [Air Force Research 
Laboratory], is what we call adaptive engine technology.
    What the $1 billion allows us to do is--without that, we 
were going to basically end with some technology development--
piece part technology development about 2017, and we just did 
not have the money to take it further, which, of course, for 
all the reasons you said, you know, it is just--you know, we 
didn't want to stop it, but we had no choice with the budget.
    With the billion dollars in there, we are going to be able 
to continue that and at least take it, I believe, potentially 
to an engineering development model. I am hoping--and there--
depending on how mature the technology is, that we could 
further that even through the end of 2019 or so. Again, we are 
working through the details of it, of exactly how far it is 
going to take us.
    I think, also, it is going to depend upon our assessment 
how mature the technology is as to how quickly we can go into 
an EDM [electric discharge machining]-type situation, but it is 
going to allow us basically--it doesn't completely get us to 
transition. You know, we all talk about the transition and the 
``valley of death.'' But it is a bridge that starts to bridge 
the ``valley of death.''
    So it was a good thing that we are doing that and we are 
continuing it. And I hope we can. As a technologist, I think it 
is great work.
    Dr. Wenstrup. Well, I appreciate that. Thank you very much.
    I yield back.
    Mr. Turner. Thank you.
    Admiral, you mentioned in your testimony that meeting the 
Marine Corps F-35B IOC will require modification of aircraft to 
bring them up to the required hardware configuration and that 
the schedule to do so is tight.
    What steps is the Navy taking to mitigate the risk that all 
required modifications will be done on time? We are aware that, 
previously, General Bogdan has indicated that it is not 
necessarily--some of these delays are not necessarily software 
development, they are actually completion of modifications. Do 
you have a comment?
    Admiral Grosklags. Yes, Mr. Chairman. I will address that 
for you.
    This is not a technical issue for us. This is purely a 
management issue. We understand the technical changes that need 
to be made to the aircraft. The simple fact is we have 
competing priorities.
    We have aircraft required for test. We have aircraft 
required for training our pilots to make sure that the pilots 
are trained and ready for initial operational capability. And 
we need to use those same--or take those same aircraft and turn 
them around and modify them to the appropriate IOC 
configuration. So it is a management issue. It is not a 
technical issue. So I just want to be clear on that.
    What we are doing, quite honestly, is prioritizing. We are 
trying to ensure that, with the depot stand--the recent depot 
standup at Cherry Point last year, that gives us the facility 
to do the deep modernization work that needs to be done.
    We have also established a small footprint at Yuma at the 
operational site so we can do limited modifications there.
    Part of our approach is to try and bundle, if you will, the 
modifications that need to be done. So we are taking a close 
look at the scope of the modernization so we don't have to 
reach in to various parts of the aircraft more than one time.
    So, in a nutshell, that is it. General Schmidle may have 
more insight to specific things the Marine Corps is doing, but 
it is really a management issue for us.
    General Schmidle. Again, if you like, just to pile on very 
briefly, in terms of the schedule for the modifications, we 
are, in fact, taking a very, very close look.
    As General Bogdan said, this is actually--he mentioned it 
was his concern going to IOC. It is, we believe, the long pole 
in the tent right now, and we have got all kinds of focus on 
this, to include down to the squadron, to the individual 
airplane level, how many airplanes they need on the line to be 
able to fly, the sorties the pilots need to be able to get 
ready to IOC the jets so that we can declare IOC in the summer 
of 2015.
    It clearly is a challenge, but we are absolutely laser-
focused on it right now.
    Mr. Turner. My last question, Dr. LaPlante. You mentioned 
in your testimony that the Air Force has concern about the 
aerospace industrial base that supports engineering, design, 
and development of tactical fighter aircraft. You note that, 
when production of the F/A-18 and F-15 ends, there will be only 
one prime contractor producing tactical aircraft.
    What steps is the Air Force taking in the FY 2015 and the 
future years to address this concern? And when you say we are 
accepting risk that some elements of the current aerospace 
industry capacity may atrophy, what specific skills are likely 
to atrophy and what would be the impact on the Nation's 
aerospace programs? And how do the Air Force long-range strike 
aircraft program and the Navy's Unmanned Carrier Launched 
Airborne Surveillance and Strike programs affect the industrial 
base necessary to develop and produce tactical fighter 
aircraft?
    Dr. LaPlante. Yes. I appreciate the question.
    There are key skill sets that, of course, are needed to 
build advanced tactical aircraft, some of which are common to 
the bomber. It is not completely a one-to-one correlation, but 
we can't talk much publicly about the bomber because of 
security classification.
    But I think it has been--as we have been saying, it is 
identified to be going after mature technologies such to lower 
risk, something that is at high TRL [technology readiness 
levels], as they call it.
    What the Air Force is doing consciously in that program is 
beginning to set up a feeder line, if you will, so when the 
first versions of the bomber start getting delivered, they have 
in there, for lack of a better word, the hooks and the blocks 
to put in future upgrades, that there is, frankly, a technology 
line and a technology demonstration line that can feed those 
future blocks.
    I will tell you--I mean, I can't go into the details here 
because of the classification. I would say it is in the 
following type of areas: It is in materials. It is how we 
integrate and keep low observable technology with electronic 
attack. It is with advanced controls. Those are the kind of 
areas that we are very conscious of keeping the industrial base 
alive, and those are--could be common between advanced tactical 
and the bomber.
    Do I think that that is by itself enough? I don't, 
actually. And I don't pretend to have all the answers here. But 
I will tell you what some of us are thinking is that exactly at 
this time is probably when--if you look back in history when, 
in the past, we have done, for lack of a better word, 
experimentation, whether it was in the 1990s or in the 1970s, 
where we kept prototyping, we kept ideas, we kept innovation 
going, we kept design teams going even for things that we 
didn't know if we were just going to put on the shelf, but that 
we were trying. And we were trying them between the technology 
community and the warfighter. We believe--there is many of us 
that believe we are in the era now where we need to be doing 
that.
    Now, that is not a panacea for all of the industrial base. 
That will not deal with, for example, a production line being 
shut down. We have to think differently about that.
    But I believe that we need to do some type of comprehensive 
experimentation program to feed not just the future bomber, 
which we already have some of that going on, which I can't go 
into because it is classified, but to feed whatever we end up 
with beyond F-35 and even F-35 itself.
    In my experience, we often set up the mainstream program to 
have the hooks and the blocks, and then we kind of just assume 
industry will innovate and provide us the technology. Well, we 
also have to fund it. IRAD [independent research and 
development] can only go so far. So I believe we need to, as a 
Department--this isn't just in Air Force--set up such an 
experimentation program.
    Thank you.
    Mr. Turner. Mr. Veasey.
    Mr. Veasey. Yes. I wanted to ask specifically about the 
retiring of the 283 A-10s. Now, when those A-10s are retired, 
all those planes are going to be replaced with F-16s and F-35 
at many of those bases. Isn't that correct?
    General Field. Yes, sir, it is.
    Mr. Veasey. Okay.
    General Field. Except for one. One of the units is a Guard 
unit from Idaho, and they are going to become an active 
associate--or a classic associate, which means they are going 
to work with the Mountain Home F-15Es and fly those airplanes.
    Mr. Veasey. And the A-10--the role of the A-10 is 
basically--it is pretty much a single mission. It is just 
basically to provide ground support. Is that----
    General Field. Sir, its primary mission is to provide close 
air support for troops on the ground that are fighting. It does 
some other things in terms of personnel recovery and some other 
air-to-ground missions as well, but that is its primary role, 
is in close air support. That is correct.
    Mr. Veasey. Okay. So when you land those things--because I 
know that the Air Force has also looked at retiring some B-1 
bombers and even looked at retiring F-16s and F-15s.
    And so I just wanted to know if you could expand just a 
little bit more on retiring some of those planes versus the A-
10s.
    General Field. Yeah. Sir, I think that was a 
misinterpretation of some previous discussions with folks.
    When we talked about the A-10 decision, we went through a 
series of analysis to look at the effect that would have, and 
we compared that with what the Air Force brings to the table to 
the joint community.
    Because, at the end of the day, we fight as a joint force 
and we need to be able to provide the capabilities to our 
brothers and sisters in the other services and our coalition 
partners.
    So we looked through mobility. We looked through ISR. We 
looked through air superiority. We looked at command and 
control. And we looked at, you know, precision attack. And 
there are all kinds of facets to every one of those.
    We also did a study with our--in the Air Force and we did 
some analysis and lessons learned with the Army on how we would 
perform the CAS mission, the close air support mission, if the 
A-10 did go away.
    And when we looked across the spectrum of conflict that we 
might be having, when we looked into some of the higher-end 
issues that we might be facing in the future, it looked like 
the A-10 was the best of all bad options to take off the table.
    There isn't a single airman in the Air Force that thinks 
this is a good idea. This is basically a budget-driven 
decision. So we came to the conclusion that we had to remove 
the A-10 because, if we took the whole fleet out, we could take 
a lot of the support structure and gain billions of dollars in 
savings, not millions of dollars in savings.
    And so some of the examples that you referenced here are 
some of the things we looked at just to explain the comparison. 
So if we take the A-10 fleet out, we will save about $4.3 
billion over the FYDP.
    To get that kind of savings, if we took out F-16s, we would 
have to take--retire 350 F-16s, which affects about 14 
squadrons. We would have to take out the entire B-1 fleet, 62 
aircraft.
    So why don't we want to take out the B-1 fleet? The B-1 
provides most of our--you know, 38 percent of our long-range 
strike and is the only aircraft in the Air Force inventory that 
is going to use--be able to employ the JASSM [Joint Air to 
Surface Standoff Missile], which is a long-range cruise 
missile, between now and fiscal year 2019 and 2020. It is 
enormously capable and can do missions from CAS to deep strike 
and beyond.
    The 350 F-16s--the amount of capability was just more so 
than the A-10 in terms of not just the CAS environment, but in 
other missions beyond that. We looked at ways that we could 
reduce readiness, and we have already--we are already down at 
what I would term a critical level in the readiness status of 
our combat air forces. And we would go even lower to the fact 
that we would take off--two to three squadrons would just not 
fly ever at a time for the near future.
    So when we looked through that, we looked at the studies, 
we discussed it with our service partners, we decided that the 
A-10 was the best decision to make, even though nobody likes 
the result of that decision.
    Mr. Veasey. Thank you, Mr. Chairman.
    Thank you.
    Mr. Turner. Gentlemen, thank you. We are going to conclude. 
They have called votes on the House floor. We appreciate all of 
your comments. And thank you for your service. We will be 
adjourned.
    [Whereupon, at 2:03 p.m., the subcommittee was adjourned.]
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                   QUESTIONS SUBMITTED BY MR. TURNER

    Mr. Turner. GAO's most recent report points out that software 
delays may impact software deliveries and could hinder the delivery of 
expected warfighting capabilities--first to the Marine Corps and then 
possibly to the Air Force and Navy as well. Please describe the mission 
system software difficulties that the program has experienced, and 
explain what the program is planning to do/or is in the process of 
doing to mitigate the impacts of those difficulties. What are the 
impacts, if the program is not able to deliver all of the expected 
warfighting capabilities to the Marine Corps by July 2015?
    General Bogdan. The F-35 Joint Program Office (JPO) does not fully 
agree with all of the conclusions made by the GAO in their recent 
report, ``Problems Completing Software Testing May Hinder Delivery of 
Expected Warfighting Capabilities.'' The program is making steady 
progress and is fundamentally on the 2011 baseline plan, with moderate 
confidence in the Block 2B/3i software delivery schedules. There is 
additional risk with 3F as it is dependent upon the successful and 
timely completion of blocks 2B/3i.
    Software continues to be the program's number one technical risk; 
however, the program has a track record of overcoming difficulties 
related to software development. These difficulties include technical 
challenges implementing multi-level security in Block 1B, delays in 
maturing and integrating Block 2A software, and burning down 
outstanding technical debt from earlier software blocks. Over the past 
two years, the program has implemented significant changes in how 
system software is developed, lab tested, flight tested, measured, and 
controlled. The program is starting to see the positive effects of 
these changes. As part of these process changes, the program has:
      Created a Capability Block Plan that provides an 
integrated roadmap to define when individual capabilities are 
integrated into each software block.
      Instituted a Block Review Board, led by the government, 
to track all configuration, capability, and schedule changes to 
software development.
      Directed a more robust Systems Engineering/Technical 
Review process for all development work to provide greater knowledge 
and defined decision gates to determine when configurations are mature 
enough to proceed to the next phase. This includes assessing the impact 
and corrective actions for issues identified against the defined Block 
Capabilities and missions.
      Developed tools to define the relationship of each 
planned software capability to the overall mission sets, providing 
insight into the impact to mission effectiveness resulting from any 
potential shortfalls in capability maturity.
    In addition to implementing process changes, the program has made 
considerable strides in maturing the on-board software as a whole and 
retiring risks from earlier software blocks to establish a healthy 
foundation going forward. Specifically, the technical debt from 
previous software blocks will essentially be negated as we enter into 
Block 3 development and integration. The program has also recovered 
from software delays in fielding Block 2A LRIP 5 software and has 
executed the Block 2B plan largely to the baseline. Lastly, the program 
has successfully demonstrated the rehosting of Block 2A and early Block 
2B capability on the TR-2 hardware required for Block 3i LRIP 6 
aircraft.
    It is the JPO's plan to deliver all Block capabilities at the 
required maturity levels to meet the Marine Corps, Air Force, and Navy 
Initial Operational Capability (IOC) dates. Anomalies that may have an 
impact to planned IOC mission sets are either being corrected or 
assessed with the stakeholders for acceptability. It is my assessment 
that delivery of Block 2B-capable aircraft for USMC IOC is tracking to 
a July 2015 date and software is not expected to be the limiting 
factor.
    Mr. Turner. GAO and others have identified affordability as a 
significant challenge for the F-35. The total financial commitment 
needed for the program's operation and support costs are still 
estimated at around $1 trillion, and GAO notes that acquisition costs 
over the coming decades will average $12.6 billion a year. What is the 
program doing to ensure that this program is affordable in the long-
term?
    General Bogdan. Affordability continues to be one of my top 
priorities. Over the years, my team and I have been successful at 
shifting the cost risk from being fully absorbed by the government to a 
more equitable split between the government and the contractors. This 
has incentivized the contractors to become participants in driving down 
costs, without compromising capability or quality. We have been 
successful in ensuring that lot over lot, the cost of the aircraft 
continues to come down, and I expect this trend to continue. Although 
the cost is coming down, it has not come down as quickly as I would 
like, and I am taking strategic steps with my team to deliver an F-35A 
in Fiscal Year 2019 between $80-85 million in FY19 dollars. Operation 
and Sustainment (O&S) is one of the main cost drivers over the 
lifecycle of the program and it is imperative that we get it right. 
Some of the initiatives to address O&S affordability include:
      Established an F-35 Cost War Room, which includes 
representatives from prime contractors, with the objective of 
identifying program-wide initiatives to drive down overall program 
costs. They are currently examining 48 opportunities to drive down or 
remove costs from the program.
      Executing a Level of Repair Analysis study to define the 
most cost effective repair enterprise for the U.S. and International 
Partners. The outcome of this study will help us determine the optimum 
repair structure. We expect the study to be available for review by the 
U.S. Services in the third quarter of this year.
      Completed a second Business Case Analysis in April 2014 
to help inform the most cost effective Regional sustainment construct. 
This analysis will determine the best-value sustainment solution across 
a range of alternatives using a consistent set of baseline requirements 
and ground rules. We expect to have the analysis confirmed and 
finalized within the third quarter of this year.
      Established an actively-managed and funded Reliability 
and Maintainability (R&M) Improvement Program with the objective of 
redesigning components to improve R&M from both a hardware and software 
perspective. The intended outcome will be increased component 
reliability and decreased maintenance burdens.
    We continue to press forward with continuous improvement/
producibility efforts in order to reduce the labor hours associated 
with aircraft production. We are examining methods of addressing 
Diminishing Manufacturing Sources to introduce competition in the 
supply chain. We are taking a systematic approach to reduce aircraft 
prices below the normal production learning curves and are addressing 
supply chain arrangements to reduce material costs. The procurement 
quantity from year to year is a significant factor in achieving lower 
procurement costs. In the last two years, our International Partners 
and the U.S. Services have delayed purchases to future years, delaying 
the timeline for realizing unit cost targets. Over the next few years, 
I expect Foreign Military Sales customers to increase their quantities, 
which will make up for some of the delayed purchases by the U.S. 
Services and our International Partners, but if we continue to see the 
current trend then it will further delay how quickly we are able to 
reduce the procurement cost of the aircraft.
    Mr. Turner. GAO notes that the F-35 program office estimate for 
operation and support costs is around $200 billon lower than the $1 
trillion estimated by OSD. They also note that the major driver in the 
difference between the two estimates is the use of different inflation 
assumptions. Please explain how the program came to its most recent 
estimate. To what extent do you believe that the program's estimate is 
more reliable than the OSD estimate?
    General Bogdan. In the 2012 System Acquisition Report (SAR), the 
OSD Cost Assessment and Program Evaluation (CAPE) and F-35 Joint 
Program Office (JPO) estimate for Operational and Support (O&S) costs 
differed in excess of $200 billion. There were two significant factors 
that led to this difference. First, the CAPE did not update the O&S 
cost estimate for SAR-12 but instead used the estimate from SAR-11, 
whereas, the F-35 JPO did update the O&S cost estimate for SAR-12 
utilizing the latest data available. Secondly, the F-35 JPO and the 
CAPE used different inflationary assumptions which accounts for the 
large difference in SAR-12 Then Year Dollar (TY$) estimates. For SAR-
13, the CAPE did update their O&S estimates and reductions were seen in 
both the Base Year Dollar (BY$) and TY$ estimates.

 
----------------------------------------------------------------------------------------------------------------
          O&S Estimates              SAR 12 BY12$         SAR 12 TY$B        SAR 13 BY12$         SAR 13 TY$B
----------------------------------------------------------------------------------------------------------------
CAPE O&S                          $617.0              $1113.3             $597.8              $1016.5
----------------------------------------------------------------------------------------------------------------
JPO O&S                           $549.2               $856.7             $541.1               $916.8
----------------------------------------------------------------------------------------------------------------
Difference                        $129.5               $256.6              $56.7                $99.7
----------------------------------------------------------------------------------------------------------------


    In SAR-13, the TY$ difference between the CAPE and JPO's O&S 
estimates was reduced from $256.6 billion to $99.7 billion. The F-35 
JPO O&S estimate differs from the CAPE O&S cost estimate primarily in 4 
areas--reliability, depot overall, government/contractor manpower and 
F-35A fuel consumption:
    1. Reliability: The CAPE used the Director, Operational Test & 
Evaluation's (DOT&E) estimate for Reliability and Maintainability (R&M) 
based on 8,500 fleet hours. The F-35 JPO used the most current R&M 
forecasts of steady state reliability, informed by approximately 12,000 
fleet hours, for their estimate. The CAPE position for this element is 
4% higher than the JPO position.
    2. Depot Overhaul: the CAPE used historical data from AV-8B and F/
A-18C aircraft and assumed each depot event was a discreet action and 
summed these actions for a total cost estimate. The F-35 JPO used 
historical data from F-15, F-16, and F-22 aircraft and bundled certain 
depot events, modeled after the strategy within the F-18 aircraft 
community. The CAPE position for this element is 71% higher than the 
JPO position.
    3. Government/Contractor Manpower: The CAPE used the 2011 manpower 
estimate which was based on high level manpower requirements allocated 
at a 20/80 government/contractor split for most elements. The F-35 JPO 
used the Fiscal Year 2013 latest manpower estimates as represented in 
the current sustainment strategy based on a discrete assessment of 
government and contractor requirements for future sustainment work. The 
CAPE position for this element is 17% higher than the JPO estimate.
    4. Fuel Consumption: The CAPE used a revalidated Air Force fuel 
burn rate that did not change from SAR-12. The F-35 JPO used a lower 
burn rate that was initially validated in the Air Force Weapon System 
Planning Document. Future SARs will ensure that the CAPE and F-35 JPO 
will use the same fuel burn rates. The CAPE estimate for this element 
is 5% higher than the JPO.
    I am confident in the F-35 JPO estimate for O&S costs. 
Incorporating the same technical baseline for these 4 areas would have 
resulted in less than 2% difference between the CAPE and F-35 JPO O&S 
cost estimates.
    Mr. Turner. GAO notes that the program will be challenged to meet 
its unit cost affordability targets by 2019, as required by OSD. How 
does the program plan to meet its unit cost targets, if at all, and 
what steps are being taken to achieve those targets? If the targets are 
not met not, what is the impact and what action(s) does the program 
plan to take?
    General Bogdan. Based on the program's current production and 
procurement profile, I am moderately confident that we will meet the 
Department of Defense's (DOD) unit price target of $83.4M in Fiscal 
Year (FY) 2019. Under the current procurement profile, we will deliver 
an F-35A in FY19 between $80-85 million in FY19 dollars. For the F-35B 
and F-35C, I am moderately confident that we will meet the unit cost 
targets or be within a few percentage points of the target.
    Affordability continues to be one of my top priorities and my team 
and I continue to strive to not only meet the DOD unit price targets 
but to realize unit costs below the target. Over the years, my team and 
I have been successful at shifting the cost risk from being fully 
absorbed by the government to a more equitable split between the 
government and the contractors. This has incentivized the contractors 
to become participants in driving down costs, without compromising 
capability or quality. We have been successful in ensuring that lot 
over lot, the cost of the aircraft continues to come down, and I expect 
this trend to continue. Although the cost is coming down, it has not 
come down as quickly as I would like and I am currently pursuing 
several initiatives to make the F-35 weapon system more affordable and 
bring down the unit cost of the aircraft.
    Operation and Sustainment (O&S) is one of the main cost drivers 
over the lifecycle of the program and it is imperative that we get it 
right. Some of the initiatives to address O&S affordability include:
      Established an F-35 Cost War Room, which includes 
representatives from prime contractors, with the objective of 
identifying program-wide initiatives to drive down overall program 
costs. They are currently examining 48 opportunities to drive down or 
remove costs from the program.
      Executing a Level of Repair Analysis study to define the 
most cost effective repair enterprise for the U.S. and International 
Partners. The outcome of this study will help us determine the optimum 
repair structure. We expect the study to be available for review by the 
U.S. Services in the third quarter of this year.
      Completed a second Business Case Analysis in April 2014 
to help inform the most cost effective Regional sustainment construct. 
This analysis will determine the best-value sustainment solution across 
a range of alternatives using a consistent set of baseline requirements 
and ground rules. We expect to have the analysis confirmed and 
finalized within the third quarter of this year.
      Established an actively-managed and funded Reliability 
and Maintainability (R&M) Improvement Program with the objective of 
redesigning components to improve R&M from both a hardware and software 
perspective. The intended outcome will be increased component 
reliability and decreased maintenance burdens.
    We continue to press forward with continuous improvement/
producibility efforts in order to reduce the labor hours associated 
with aircraft production. We are examining methods of addressing 
Diminishing Manufacturing Sources to introduce competition in the 
supply chain. We are taking a systematic approach to reduce aircraft 
prices below the normal production learning curves and are addressing 
supply chain arrangements to reduce material costs.
    The procurement quantity from year to year is a significant factor 
in achieving lower procurement costs. In the last two years, our 
International Partners and the U.S. Services have delayed purchases to 
future years, delaying the timeline for realizing unit cost targets. 
Over the next few years, I expect Foreign Military Sales customers to 
increase their quantities, which will make up for some of the delayed 
purchases by the U.S. Services and our International Partners, but if 
we continue to see the current trend then it will further delay how 
quickly we are able to reduce the procurement cost of the aircraft.
    Mr. Turner. Your recent report emphasizes the risks posed by 
continuing delays in mission systems software testing, and notes that 
those delays could limit the capabilities the Marine Corps receives at 
the time it plans to declare its initial operational capability. If the 
program continues to experience software related delays, what 
additional impacts do you believe this could have on the program?
    Mr. Sullivan. [The information was not available at the time of 
printing.]
    Mr. Turner. In addition to software, GAO's most recent report 
identifies a number of other ``technical'' risks that the program has 
faced during development. What progress have you seen the program 
making in these technical risk areas; and which areas, if any, do you 
believe still pose risks?
    Mr. Sullivan. [The information was not available at the time of 
printing.]
    Mr. Turner. F-35 operation and support costs--which are still 
estimated at around $1 trillion over the life of the fleet--represent a 
potentially significant financial obligation for the Air Force and 
Navy, and have been deemed ``unaffordable'' by the Department. What 
steps do you think the program can take to drive operating and 
sustainment costs down?
    Mr. Sullivan. [The information was not available at the time of 
printing.]
    Mr. Turner. You mentioned in your written testimony that F-35 
sustainment costs remain a concern. What actions are the F-35 Joint 
Program Office and the Department of the Navy taking to reduce F-35 
life-cycle costs?
    Admiral Grosklags. The Department of the Navy and the F-35 Program 
Executive Office (PEO) are continuing to reduce the Operations and 
Support (O&S) costs. As a result of our efforts to date and as reported 
in the 2013 Selected Acquisition Report (SAR), the CAPE O&S estimate 
from SAR 2012 to SAR 2013 reduced by approximately three percent (in 
BY2012 dollars). The Department and PEO have several initiatives 
underway that have substantial O&S cost savings potential:
    1.  The Services are reviewing basing assumptions, squadron size, 
and training requirements. As an example, the training mission profile 
has been refined resulting in reduced estimates for F-35C fuel usage.
    2.  The Services and PEO are conducting a level of repair analysis 
that fully explores all three levels of maintenance to improve 
readiness and reduce repair and turnaround costs. The study is expected 
to conclude in May.
    3.  The PEO has established a sustainment cost war room with active 
participation from Lockheed Martin and Pratt & Whitney. The team is 
focused on life-cycle affordability. Some of the initiatives include 
aligning periodic maintenance and planned modification, aligning engine 
data to maintenance planning, pursuing Red Air alternatives in training 
squadrons, reusing support equipment from legacy programs, optimizing 
the number of pilot fit facilities and warehousing, and optimizing low-
observable maintenance practices.
    4.  The PEO has a focused effort on reliability and maintainability 
improvements. The top reliability degraders have been identified and 
the PEO is conducting business case analysis for each to determine the 
best investment opportunities for improved reliability and/or reduced 
cost.
    5.  The PEO is conducting a business case analysis to evaluate 
alternative lifecycle sustainment strategies comparing the baseline 
full contractor logistics support construct to a spectrum of fully 
organic or a hybrid mix of contractor and organic support. Initial 
results have identified several cost drivers in both labor (organic 
rates are lower than contractor rates) and material (original equipment 
manufacturer mark-up). The study will also consider investment costs 
such as data rights, additional manning resources, training, and spares 
inventory.
    Mr. Turner. The budget request postpones the MQ-4C Triton low-rate 
initial production from fiscal year 2015 to fiscal year 2016. What 
steps is the Navy taking to mitigate the effects of this delay on the 
Navy's requirement for intelligence, surveillance, and reconnaissance?
    Admiral Grosklags. Postponement of MQ-4C Triton low-rate initial 
production from Fiscal Year (FY) 2015 to FY 2016 resulted in a one-year 
fielding delay for MQ-4C Triton Multi-INT (signals intelligence 
capability) to FY 2020. In accordance with the National Defense 
Authorization Act of 2011 and the Navy's Maritime Intelligence, 
Surveillance, Reconnaissance, and Targeting (MISR&T) Transition Plan, a 
delay in fielding MQ-4C Triton Multi-INT required a corresponding 
sustainment of legacy MISR&T platforms. The Navy's Special Projects 
Aircraft (SPA) squadron will operate through FY 2019 and the Navy's 
Fleet Air Reconnaissance (VQ) squadron will operate through FY 2020. 
These one-year extensions to planned retirement dates will ensure 
adequate MISR&T assets exist to meet Global Force Management 
requirements until MQ-4C Triton Multi-INT is fielded in sufficient 
numbers.
    Mr. Turner. You mention in your testimony that meeting the Marine 
Corps F-35B IOC will require modification of aircraft to bring them up 
to the required hardware configuration and that the schedule to do so 
is tight. What steps is the Navy taking to mitigate the risk that all 
required modifications to the F-35B fleet will be done on time?
    Admiral Grosklags. The Marine Corps and the F-35 Program Executive 
Officer (PEO) are working together to meet aircraft modification 
requirements in support of F-35B Initial Operational Capability (IOC). 
The technical issues are understood; it is a management issue that is 
receiving the appropriate attention. The Marine Corps and PEO are 
building and constantly refining an integrated modification schedule to 
incorporate several air vehicle and propulsion modifications that will 
be performed at various locations. Most significant is the planned 
increase in aircraft throughput capacity at the Fleet Replacement 
Center-East in Cherry Point, NC. We may also look to increase 
throughput capacity and/or work at Yuma, AZ, as well as other locations 
to ensure requirements for F-35B IOC are met. The current planned 
timelines for throughput capacity increase and modification completion 
are executable, but leave a small margin before impacting F-35B IOC.
    Mr. Turner. Your written testimony notes that the Marine Corps 
strike fighter shortfall is 20 aircraft in 2023. Do you believe that 
the Marine Corps may experience an elevated operational risk in the 
2020's if the predicted strike fighter shortfall comes to fruition? 
Please describe why you believe the Marine Corps faces this elevated 
operational risk and what the Department of the Navy is doing to 
mitigate those risks.
    General Schmidle. The Marine Corps does not believe it will 
experience an elevated operational risk in the 2020's.
    With the pending certification of the Naval Synchronization Tool 
Set and ongoing use of the Continuous Process Improvement Program (CPI 
Blackbelt projects), Marine Aviation is able to proactively plan 
aircraft utilization, and efficiently manage the service life of its 
remaining AV-8B and F/A-18A-D aircraft. In addition, Marine Corps 
Aviation is implementing force management and scheduling strategies 
targeted at greatly reducing risk throughout the transition to the F-
35.
    The Department of the Navy (DoN) continues to manage aircraft 
service life of each aircraft at the operational level in order to 
achieve the maximum allowable service life limits prior to its sundown. 
The continued engineering and Service Life Extension Program (SLEP) kit 
development over the FYDP will ensure there is sufficient TACAIR 
inventory to meet DoN requirements through the transition to the F-35.
    Mr. Turner. We understand that Marine aviation is on a path toward 
a distributed Airborne Electronic Attack system of systems including 
both unmanned and manned assets. Please describe the number and types 
of unmanned and manned assets that will be part of this system.
    General Schmidle. The Marine Corps anticipates a future operating 
environment comprised of advanced Electromagnetic Spectrum (EMS) 
Warfare and digital threats. The Marine Corps will address these 
threats with the Marine Air Ground Task Force Electronic Warfare (MAGTF 
EW) concept. This approach will leverage all available transmitters and 
sensors across the MAGTF on both manned and unmanned platforms. A 
coordination cell comprised of EMS, Cyber, Operations, Intelligence, 
and Communications subject matter experts (SME) will collectively 
integrate collections and effects-delivery efforts in real-time. The 
Marine Corps will no longer depend on a large single-purpose platform, 
since the low-density, platform-centric approach has proven 
insufficient for meeting capacity requirements. MAGTF EW systems will 
be capable of networking with Marine and Joint assets spanning the air, 
ground, space, and cyber domains.
    Any current or future airframe employed in support of MAGTF 
operations will maintain the ability to host advanced EMS payloads in 
support of integrated Spectrum and Cyber Operations. The Intrepid Tiger 
II Electronic Warfare pod, currently deployed aboard Marine 
Expeditionary Units (MEUs), is one such payload example. The types and 
numbers of these platforms and systems will be based on Service 
capacity and future mission requirements. These platforms specifically 
include future Group 4/5 Unmanned Aircraft Systems (UAS), RQ-21A, F-
35B, AV-8B, F/A-18A++/C/D, AH-1W/Z, though any aircraft in the 
inventory will be capable of serving as a host platform in the 
distributed capability network. As the future linchpin of Marine Corps 
Tactical Aviation, the F-35B will contribute by reducing counter-
integrated air defense systems (C-IADS) requirements due to its 
inherent Spectrum survivability, and adding decisive networked attack 
and exploitation capabilities in EMS regions of significance.
    While the Marine Corps is currently achieving combat success with 
EMS payloads on manned platforms in theater and adding such capability 
to deployed Marine Expeditionary Units, the application of airborne 
Spectrum Warfare will increasingly gravitate towards UAS platforms. 
Marine Corps Aviation is actively exploring options to expand its UAS 
fleet with more capable platforms to provide the requisite size, 
weight, and power to perform a combination of standoff and penetrating 
Spectrum Attack operations. Coupling new UAS employment concepts with 
emerging EW payloads offers the Marine Corps a unique opportunity to 
counter a complex IADS. This approach will enable deliberate growth in 
the Spectrum Warfare portfolio and will include communications-based 
targets, RADAR-based targets, directed-energy (DE) and LASER targets. 
Additionally, the Marine Corps is exploring the viability and readiness 
of advanced (medium-high Technology Readiness Level) Spectrum Attack 
technologies to augment baseline Intrepid Tiger 2 capability for future 
incorporation.
    Mr. Turner. If the Department of Defense is forced to accept 
sequestration-level budgets between fiscal year 2016 and 2023, what 
affect will that have on the capability and capacity of Navy and Marine 
Corps' strike fighter fleets to achieve the requirements of the 
National Defense Strategy?
    General Schmidle. The DoN is focused on maintaining a strike 
fighter fleet which possesses the capability and capacity to win 
decisively. Sequestration-level budgets will force the DoN to balance 
future capabilities and capacity within the limits of the Budget 
Control Act, challenging the ability of our strike fighter fleets to 
maintain an advantage against possible future threats and increasing 
risk in meeting National Defense Strategy requirements.
    Sequestration will reduce current modernization funding levels and 
severely limit further F/A-18A-F capability upgrades. Sequestration 
will also increase the risk to achieving initial operating capability 
goals, and ultimately, full fielding of the Joint Strike Fighter 
program of record. Initial operational capability of the F-35B in FY15 
will not be affected but may increase risk to follow-on software 
development. Additionally, any reduction to Service Life Management 
funding levels will negatively impact Marine Corps F/A-18A-D capacity 
throughout the F-35 transition. Lastly, sequestration will adversely 
impact strike fighter readiness across all of Naval aviation.
    Mr. Turner. Like the Air Force, Naval air forces require 
inventories of precision air-to-air and air-to-ground munitions. Please 
describe which inventories and short of requirements and provide the 
committee a list of those munitions and amounts above the budget 
request that could be executed in fiscal year 2015.
    General Schmidle. Navy supports the Fiscal Year 2015 President's 
Budget (PB15) as submitted.
    If additional funds were made available, the following precision 
air-to-air and air-to-ground Naval munitions, listed in alphabetical 
order, are short of their inventory requirement. The amount of funding 
above the PB15 budget request that could be executed in fiscal year 
2015 and the respective quantities to be procured with that funding is 
as follows:
    AARGM: $24.3M of WPN for an additional 46 missiles.
    AMRAAM 120-D: $62M of WPN for an additional 83 missiles.
    GP Bombs: $93.7M of PANMC for the additional components below:
    --JDAM tail kits 500 lbs ($15.3M, QTY 625)
    --JDAM tail kits 2,000 lbs ($38.0, QTY 27,576)
    --GBU-10 ($3.6M, QTY 201)
    --BLU-109 Bomb Body ($21.7M, QTY 678)
    --FMU-143 fuze ($27.5M, QTY 7624)
    Rockets: $100M of PANMC for the additional components below:
    --LAU-61 G/A Digital Rocket Launcher ($0.256M, QTY 4)
    --MK 66 MOD 4 Rocket Motor ($24.3M, QTY 57,460)
    --WGU-59/B APKWS II Guidance and Control Section ($74.3M, QTY 
2,552)
    --WTU-1/B Inert Warhead ($1.14M, QTY 15,985)
    Mr. Turner. If the Department of Defense is forced to accept 
sequestration-level budgets between fiscal year 2016 and 2023, what 
affect will that have on the capability and capacity of Navy and Marine 
Corps' strike fighter fleets to achieve the requirements of the 
National Defense Strategy?
    Admiral Manazir. The DoN is focused on maintaining a strike fighter 
fleet which possesses the capability and capacity to win decisively. 
Sequestration-level budgets will force the DoN to balance future 
capabilities and capacity within the limits of the Budget Control Act, 
challenging the ability of our strike fighter fleets to maintain an 
advantage against possible future threats and increasing risk in 
meeting National Defense Strategy requirements.
    Sequestration will reduce current modernization funding levels and 
severely limit further F/A-18A-F capability upgrades. Sequestration 
will also increase the risk to achieving initial operating capability 
goals, and ultimately, full fielding of the Joint Strike Fighter 
program of record. Additionally, any reduction to Service Life 
Management funding levels will negatively impact Marine Corps F/A-18A-D 
capacity throughout the F-35 transition. Lastly, sequestration will 
adversely impact strike fighter readiness across all of Naval aviation.
    Mr. Turner. Like the Air Force, Naval air forces require 
inventories of precision air-to-air and air-to-ground munitions. Please 
describe which inventories and short of requirements and provide the 
committee a list of those munitions and amounts above the budget 
request that could be executed in fiscal year 2015.
    Admiral Manazir. Navy supports the Fiscal Year 2015 President's 
Budget (PB15) as submitted.
    If additional funds were made available the following precision 
air-to-air and air-to-ground Naval munitions, listed in alphabetical 
order, would be augmented in numbers. The amount of funding above the 
PB15 budget request that could be executed in fiscal year 2015 and the 
respective quantities to be procured with that funding is as follows:
    NAVY 2015 Unfunded Priority List:
    AMRAAM 120-D: $96.3M of WPN for an additional 83 missiles.
    Munitions above budget request that could be executed in fiscal 
year 2015:
    AARGM: $24.3M of WPN for an additional 46 missiles.
    GP Bombs: $102.7M of PANMC for the additional components below:
    --JDAM tailkits 500 lbs ($15.3M, QTY 625)
    --JDAM tailkits 2,000 lbs ($38.0M, QTY 1,378)
    --Laser Guided Bomb tailkits ($3.6M, QTY 201)
    --BLU-109 Bomb Body ($21.7M, QTY 678)
    --FMU-139 Fuze ($24.1M, QTY 7624)
    Rockets: $100M of PANMC for the additional components below:
    --LAU-61 G/A Digital Rocket Launcher ($0.256M, QTY 4)
    --MK 66 MOD 4 Rocket Motor ($24.3M, QTY 57,460)
    --WGU-59/B APKWS II Guidance and Control Section ($74.3M, QTY 
2,552)
    --WTU-1/B Inert Warhead ($1.14M, QTY 15,985)
    Mr. Turner. You mention in your testimony that the Navy does not 
have a requirement for additional F/A-18E/F aircraft. Does the Navy 
have a requirement for additional EA-18G aircraft?
    Admiral Manazir. On-going study indicates the likelihood of 
increasing threat capability, and additional Growlers on the flight 
deck will provide a significant advantage in a high end conflict. The 
Growler will soon be the only DOD tactical AEA aircraft in the joint 
force inventory and is required to support both 4th and 5th generation 
strike fighter aircraft. With legacy jamming pods or Next Generation 
Jammers the EA-18G provides precise control of a broad range of the 
electromagnetic spectrum (EMS) to create sanctuaries for the Joint 
force, denying enemy access to portions of the EMS.
    The current total procurement of 138 aircraft can source the Navy 
mission. The addition of 22 EA-18Gs listed on the Navy's Unfunded 
Requirements List will be used to augment existing Navy squadrons in 
the execution of the joint AEA missions allowing carrier squadrons to 
deploy with seven aircraft vice their current complement of five 
aircraft per squadron. The additional aircraft will reduce risk in 
meeting operational demand for multi-ship tactics and the potential 
increased need for AEA. As nations expand their use of the EMS, the 
ability to perform the AEA mission will become more critical and buying 
additional EA-18Gs in FY15 reduces risk in our ability to meet future 
AEA demand.
    Mr. Turner. You mention in your testimony an Air Force concern 
about the aerospace industrial base that supports the engineering 
design and development of tactical fighter aircraft. You note that when 
production of the F/A-18 and F-15 ends, there will be only one prime 
contractor producing tactical aircraft. What steps is the Air Force 
taking in the FY 2015 and in the future years defense program to 
address this concern? When you say, ``we are accepting risk that some 
elements of the current aerospace industrial capacity may atrophy,'' 
what specific skills are likely to atrophy and what would be the impact 
on the Nation's aerospace programs? How do the Air Force long range 
strike aircraft program and the Navy's unmanned carrier-launched 
airborne surveillance and strike (UCLASS) programs affect the 
industrial base necessary to develop and produce tactical fighter 
aircraft?
    Dr. LaPlante. The current fiscal environment has forced the Air 
Force to make some very tough choices. In broad terms, the Air Force 
has chosen capability over capacity. The ripples from these decisions 
extend from the immediate force structure through our base 
infrastructure to the aerospace industrial base. Just as the Air Force 
lacks both the budget availability and flexibility to maintain the size 
and structure of current forces while we modernize, we lack the 
immediate mission requirements and resources to sustain the defense 
sector of the aerospace industrial base as configured. Elements of the 
aerospace industrial base have already taken some steps in terms of 
reorganizations and workforce adjustments to better position themselves 
in this new fiscal arena. The lack of demand from the Air Force will 
contribute to a reduced capacity, affecting all skills, from 
engineering through production.
    The fact that there will be only one tactical aircraft, the F-35, 
in production for the foreseeable future is a reality the Air Force has 
neither the operational requirements nor the financial resources to 
alter. However, the Air Force is able to use other elements of the 
budget to sustain and develop some industrial base capabilities at a 
reduced capacity. For example, Air Force research and development 
investments in advancing the state of the art in turbine engine 
technology contribute to the support of engineering and design teams of 
two contractors. Other aircraft programs, whether manned or not, also 
serve to sustain engineering design, integration, and production 
capabilities. Moreover, the Air Force has continuing needs for our 
current aircraft. As we maintain and modernize these legacy aircraft, 
we place demands on the industrial base for engineering design and 
production to sustain our operational capabilities.
    The defense sector of tomorrow's aerospace industrial base will be 
similar to tomorrow's Air Force--it will be capable but no longer have 
today's capacity.
    Mr. Turner. Last year the Air Force mentioned that depot delays 
would require the grounding of some of the affected aircraft, and that 
sequestration cuts to Air Force modernization will impact every one of 
the Air Force's investment programs, creating inefficiencies, raising 
unit costs, and delaying delivery of valued capabilities to warfighters 
in the field. The Air Force also noted that the Fiscal Year 2014 budget 
request would not enable full recovery of warfighting capability, 
capacity and readiness and that additional resources would be required.
    As we are into execution of the FY 2014 budget this year, what 
steps has the Air Force taken to mitigate these affects? Did you get 
the additional resources required in fiscal year 2014 to make the 
fighter fleets whole again?
    Dr. LaPlante. The Air Force did not develop its Fiscal Year 2013 
weapon system sustainment (WSS) program factoring in sequestration, so 
when ``sequestered'' impacts were added to the WSS Fiscal Year 2013 
President's Budget funding position, unfunded requirements (a bow wave) 
resulted for aircraft and engine programmed depot maintenance. 
Initially, the impact was assessed to be approximately 24 aircraft and 
84 engines. The impacts were mitigated by: Military Augmentation, House 
Resolution 933, the Consolidated and Further Continuing Appropriations 
Act of 2013, buybacks, reduction in the number planned furlough days, 
and relief from overtime limitation. Fiscal Year 2013 ended with an 
unfunded bow wave of 13 aircraft and 19 engines.
    The Fiscal Year 2014 Bi-Partisan Budget Act impact, including a 
$500 million buyback, eliminated the sequestration bow wave with depot 
production back on track with minor impacts to due dates and flow days 
for aircraft and engine. Exchangeable production was diminished during 
the furlough period but is recovering. Impacts were offset by shelf 
shock with full recovery expected in Fiscal Year 2014. All Fiscal Year 
2013 deferred aircraft and engines including the fighters were 
mitigated in Fiscal Year 2014, eliminating the sequestration bow wave.
    Mr. Turner. You mentioned in your written testimony that all three 
mission areas in the air-to-surface munitions inventory are short of 
inventory objectives. Those missions are stand-off, direct attack, and 
penetrator munitions.
    Please provide the subcommittee a list of those muntions and 
amounts that could be increased to the budget request and, if 
authorized and appropriated, could be executed in fiscal year 2015.
    Dr. LaPlante. If additional funds were made available, the 
following Air Force air-to-surface munition procurements could be 
executed in FY15 up to the quantities indicated. Quantities above the 
planned FY15 procurement will allow the Air Force to meet inventory 
objectives sooner.
    Joint Direct Attack Munition (JDAM)
    To bring production to the contracted maximum capacity of 15,000 
tail kits per year, an additional 5,000 JDAM units could be purchased 
for $147.5M.
    Joint Air to Surface Standoff Missile (JASSM)
    The FY15 production contract is currently being negotiated with 
Lockheed Martin. If additional FY15 funds were made available, 
quantities of Baseline and Extended Range (ER) missiles would be 
adjusted to maximize ER production while maintaining the most 
economical unit price within the bounds set by the Request for Proposal 
(RFP). An additional 16 missiles could be purchased for an additional 
$19.5M resulting in 100 JASSM-Baseline missiles and 140 JASSM-ER 
missiles. The planned FY16 procurement brings production to the maximum 
capacity of 360 missiles per year.
    Hellfire
    Up to an additional 3,953 Hellfire missiles could be purchased for 
$411M to bring production to its maximum steady-state capacity of 6,000 
missiles per year.
    WRM--Ammunition
    This mission area includes hundreds of items in several categories. 
Up to an additional 9,500 bombs (includes 2,000 pound penetrators and 
2,000 pound general purpose bombs) could be purchased for $275M; up to 
7,500 additional fuzes could be purchased for $15M; and up to 300,000 
additional cartridges could be purchased for $15M.
    Training Munitions Items
    This mission area includes dozens of items in several categories. 
Approximately 8,000 additional practice bombs could be purchased for 
$25M in FY15.
    Mr. Turner. We noted that the Combat Rescue Helicopter (CRH) 
program is currently scheduled for initial operational capability in FY 
2021. Will the Air Force be taking risk in its combat rescue mission 
until the CRH becomes operational?
    Dr. LaPlante. Given current aircraft attrition projections, a fully 
funded Ops Loss Replacement (OLR) program will recap the current HH-60G 
fleet to a program of record of 112 aircraft by Fiscal Year 2018. This 
will mitigate further risk to the combat rescue mission until the CRH 
program reaches initial operational capability in Fiscal Year 2021.
    Mr. Turner. If the Department of Defense is forced to accept 
sequestration-level budgets between fiscal year 2016 and 2023, what 
affect will that have on the capability and capacity of Air Force 
strike fighter fleet to achieve the requirements of the National 
Defense Strategy?
    General Field. The fiscal constraints imposed by sequestration have 
forced the Air Force to make difficult choices. All budget decisions, 
not only in the strike fighter fleet, but also across all Air Force 
capabilities, are evaluated against planning scenarios directed by the 
Office of the Secretary of Defense that support the President's Defense 
Strategic Guidance. Ultimately any decisions the Air Force makes 
regarding potential aircraft divestment will be based on aligning the 
Air Force's contribution to fulfilling the Defense Strategic Guidance, 
while complying with the fiscal constraints imposed by sequestration.
    The Air Force is very concerned with recent budget reductions and 
continues to monitor how these cuts will affect risk. The Air Forces' 
fighter fleet is approaching 30 years old--the oldest in our history. 
The Air Force is pursuing modernization programs to extend the service 
life of our strike fighter inventory. Without service life extensions 
and capability upgrades, it will be increasingly difficult to meet the 
defense strategy. Therefore, it is absolutely critical selected fourth 
generation sustainment and modernization efforts continue as outlined 
in the FY15 budget request. Additionally, we must procure the F-35 at a 
rate that ensures we have the capabilities and capacity to ensure 
success against emerging threats.
    Further, Air Force mission success is dependent on our fighter 
force manning. The Air Force is currently 200 fighter pilots short of 
the total manning requirement. Our projections indicate this deficit 
growing to approximately 500 by 2022, excluding any additional 
sequestration driven impacts on flying training. The shortfall resulted 
from a series of force reductions and it will take the Air Force many 
years to reverse this trend and recover. A return to sequestration 
level funding only exacerbates this problem and extends the number of 
years required to recover from the fighter pilot shortage.
    At the levels requested in the President's budget, the Air Force 
protects the capabilities required to prevail in the more demanding 
operational environment in years to come. At sequestration funding 
levels, it is not possible to budget for an Air Force capable of 
simultaneously performing all of the missions our Nation expects. We 
would end up with a force that is less ready, less capable, less 
viable, and unable to fully execute the defense strategy.
    Mr. Turner. You noted in your written testimony that fiscal 
constraints have driven force structure divestments of 334 fighters 
that require the Air Force to ``accept near-term risk today to be ready 
and viable tomorrow.'' What scenarios are at greatest risk with the 
reduction of 334 fighters?
    General Field. To support the National Defense Strategy and meet 
future threats, the Air Force must continue investments in new 
capability programs and upgrades to gain and maintain full-spectrum 
readiness. Budget constraints have forced difficult decisions that 
reduced fighter force capacity in an effort to rebuild a more ready 
force and bridge the gap to future force requirements. Reduced fighter 
force capacity elevates risk in all scenarios. However, these 
deliberate capacity cuts that focused on single mission part of the 
fourth generation fleet leave the Air Force with the ability to manage 
near-term risk in supporting the National Defense Strategy, although 
significant challenges still exist. Ultimately, the strategy underlying 
the Presdient's Budget allows the Air Force to balance capability and 
capacity to win today's fight while acquiring critical capabilities to 
address future threats.
    Mr. Turner. You mention in your written testimony that the Air 
Force fighter fleet is approaching 30 years old--the oldest in Air 
Force history--and that ``without service life extensions and 
capability upgrades, it will not be possible to manage risk.'' The FY 
2015 budget request includes the termination of the F-16 combat 
avionics programmed extension suite, or ``CAPES.'' How does the 
termination of CAPES affect risk, and what scenarios are most affected 
by an F-16 fleet that would not have the CAPES upgrade?
    General Field. The termination of CAPES increases risk and 
decreases operational effectiveness in several scenarios, but to remain 
within fiscal guidance constraints, we had to make difficult trades 
between force structure investment, readiness, and modernization. We 
chose to terminate F-16 CAPES because the impact on operational risk 
was judged to be less than the impact of other higher priority 
capability upgrades. This budget driven decision likely increases 
operational risk in the Homeland Defense and highly contested 
environment scenarios as the F-16 may not be as effective due to the 
loss of the Airborne Electronically Scanned Array (AESA) radar and an 
upgraded electronic warfare suite. We recognize this elevated 
operational risk; however, these decisions remain consistent with our 
approach to take near-term risk in modernization of legacy systems to 
ensure future force structure recapitalization.
    Mr. Turner. In your statement you note that when the U-2 is 
retired, you will not meet the overall demand for high altitude 
intelligence surveillance and reconnaissance (ISR). What percentage of 
high altitude ISR demands are met now, and how much less of that 
requirement will be met with retirement of the U-2?
    General Field. The requirement for high altitude ISR capability is 
defined by the Joint Requirements Oversight Council; per the classified 
definition of conventional wartime high altitude ISR needs, either the 
U-2 or RQ-4 can meet 100 percent of the force structure requirement for 
Combat Air Patrols, with a narrow classified exception for the RQ-4.
    However, retirement of the U-2 results in the loss of approximately 
50 percent of overall high-altitude ISR collection capacity. Combatant 
Commanders do not specify platforms when submitting annual ISR needs; 
however, the U-2 historically provides at least half of all high-
altitude imagery and signals intelligence products.
    Mr. Turner. What is the status of the Air Force's air-to-air 
weapons inventory? Are there shortages in the AIM-120 or AIM-9 
inventories? If so, please provide additional amounts that could be 
executed in fiscal year 2015 to address those shortages.
    General Field. Currently, both the AIM 120 and AIM 9 inventories 
lag Air Force requirements. Actual inventory requirements are 
classified and available under separate cover. At this time, the Air 
Force is not requesting any additional amounts for AIM-120D or AIM-9X 
procurement above what is presented in the FY15PB. The FY15PB addresses 
the inventory shortages with an overall increase to Air Force AIM 120D 
procurement by 103 missiles and AIM 9X Block II procurement by 333 
missiles across the FYDP over FY14PB levels. The FY15PB also includes 
Air Force procurement of an additional 388 AIM 120D and 201 AIM 9X 
missiles in FY19 and the production lines for both missiles are 
expected to remain open well into the 2020s.
    In the FY15 Opportunity, Growth, and Security Initiative, OSD 
included a request for $62M in WPN to procure approximately 62 AIM-120D 
missiles for the Navy in addition to the Air Force's FY15PB request for 
200 missiles. The FY15PB already outlines an aggressive Air Force and 
Navy AIM-120D production profile across the FYDP that balances the 
inventory shortage with the program's aggressive Diminishing 
Manufacturing Sources and Material Shortages (DMSMS) efforts. Any 
increase in FY15 quantities beyond 262 missiles is limited by a 
depleting stock of missile components impacted by DMSMS issues. 
Production line introduction of components redesigned to address DMSMS 
are planned in FY16 and FY18 that will allow production quantities to 
increase as shown in the FY15PB.
    For AIM 9X, the total Air Force and Navy procurement quantities 
could be increased by a maximum of 168 missiles with an approximate 
total cost of $67M in FY15.
                                 ______
                                 
                    QUESTION SUBMITTED BY MR. SMITH
    Mr. Smith. When do you propose to standardize your fleet?
    General Schmidle. Many different funding sources have been pursued 
over the past three years to retrofit the first 36 AH-1Z aircraft that 
are still equipped with the legacy T700-401 engines. Due to competing 
priorities in this fiscally constrained environment, the engine upgrade 
has thus far remained unfunded. Marine Aviation continues to explore 
all avenues of funding for this initiative.
                                 ______
                                 
                    QUESTIONS SUBMITTED BY MR. JONES
    Mr. Jones. It is my understanding that when the Marines started the 
AH1Z and UH1Y program, that the first 36 AH1Zs were built utilizing old 
engines which were really built for the AH1W and that using those 
engines have resulted in aircraft that cannot carry a full payload on a 
hot day and that it also complicates logistical support and results in 
pilots having to learn two different sets of aircraft limitations. Is 
this true?
    General Schmidle. The first 36 AH-1Zs built were ``remanufactured'' 
AH-1Ws that still have the old T700-401 engines installed. These 36 
aircraft will have dissimilar engines from the other 313 AH-1Z and UH-
1Y aircraft in the Marine Corps' inventory unless retrofitted with new 
the T700-401C engines. The first 36 AH-1Zs with the 401 engines have 
110 less shaft horsepower in each of their two engines. In same 
environmental conditions (6000 feet and 95 degrees F), the newer 401C 
configured AH-1Z can carry four additional Hellfire missiles and 100 
extra rounds of 20mm while increasing speed by 10%. Single engine 
performance is even more disparate. In hot temperature, high altitude 
conditions with heavy payloads, the decreased power of the old 401 
engine increases risk during a single engine failure situation.
    These 36 aircraft also complicate logistical support across the 
fleet by requiring separate spare parts, maintenance training and 
technical publications. Marine pilots do not need to learn two 
different sets of engine limitations. The temperature limits are the 
same for the old 401 engines and the new 401C engines. However, the 
power reduction does pose a pilot awareness issue during standard 
flight operations at high altitudes, in hot temperatures, and at full 
payloads, as pilots will need to be aware of the performance reductions 
of the 36 specific AH-1Z aircraft with 401 engines mixed within the 
entire AH-1Z fleet including 401C engines.
    Mr. Jones. If this is true how much would it cost to upgrade these 
36 aircraft and standardize your fleet?
    General Schmidle. It will cost $62.7 million to upgrade all 36 AH-
1Z aircraft with 72 T700-401C engines in order to standardize the AH-1Z 
and UH-1Y fleet.